Power & Market

Could Trump's Next Fed Chair Be A "Goldbug?"

01/17/2020Tho Bishop

This week, Donald Trump formally nominated Judy Shelton and Christopher Waller for vacant governorships on the Federal Reserve. Waller, the Vice President of the Richmond Fed, is widely viewed as a standard Fed nominee with the reputation of being a "dove" who has criticized recent interest rate hikes.

It is Judy Shelton who is particularly interesting.

A former campaign adviser for Trump, Shelton has been a vocal Fed critic who has praised the gold standard in the past. While she has recently advocated for lower interest rates, she has also been a critic of the Fed's policy of paying interest on excess reserves that has become a key policy tool since 2008. Shelton's nomination is also interesting  due to her background standing in stark contrast to most of her colleagues. 

As Joseph Salerno has noted:

The good news is that Ms. Shelton is not a technically trained academic economist, indoctrinated in the prevailing orthodoxy. She holds a doctorate in business administration from the University of Utah and has spent most of her career in the world of free-market policy think tanks, including stints at the Hoover Institute and the Atlas Network. She also writes refreshingly and articulately in favor of the gold standard, or some version of it.

The bad news is that she leans heavily toward supply-side economics, which is deeply flawed on monetary policy. Like most supply-siders, the position she advocates may be summed up in the motto, “I favor sound money—and plenty of it.”

Still, though by no means an Austrian, Shelton's voice on the Fed would create some much needed ideological diversity to the central bank.

In reacting to an interview with Ms. Shelton last June, Jeff Deist wrote:

Her comments represent the most substantive attack on the Fed, and central banking generally, by any potential nominee to the Fed board in recent history. She not only challenges how Jerome Powell and Fed officials conduct monetary policy, but whether they can conduct it competently at all....

So Shelton doesn't want to End the Fed. But in the parlance of woke America, she's an "ally." Recognizing the limits of central bank omniscience, and challenging its benevolence, are important first steps on the road to redeeming our money and our economy. 

In fact, it was precisely these unorthodox views that make her nomination a less-than-sure thing, even with a Republican-controlled Congress.  As Bob Murphy has noted, her competency in financial history has made her the target of criticism from establishment powers on both left and right. Particularly of issue is comments made by Republican Senators, often offering criticism with intellectual depth on par with their colleague Ms. Ocasio-Cortez. For example, when asked about Shelton's views on gold, Senator Richard Shelby, the Chairman of the Senate Banking Committee, could only offer:

The gold standard would probably shatter a lot of people’s dreams around the world right now...There was a reason to get off of it.

The fact that the administration insisted on nominating Shelton, in spite of the public concerns, demonstrates a certain level of confidence that her nomination will not be shot down. 

What's particularly interesting is that CNBC notes that there has been speculation that Shelton could be a potential for Jerome Powell if Trump is still in office at the end of the Fed chair's term in 2022. If so, that would bring someone who the Wall Street Journal described as a "goldbug" to the office of America's top central banker.

Of course, as Alan Greenspan's tenure showed, that may not actually mean much.

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Catholics and Libertarians

11/27/2019David Gordon

Can a Roman Catholic be an Austro-Libertarian as well? Christopher Ferrara in a book called The Church and the Libertarian says that one cannot. In Ferrara’s view, Austrian  economists deny that the moral law applies to the economy. Instead, Austrians say, strictly scientific laws govern the economy and these limit what the State or the Church can do. Minimum wage laws, for example, tend to cause unemployment, like it or not.

Ferrara challenges this contention. Economic laws are not absolute but must be subordinated to the moral law. For example, a worker must be paid a “living wage” that enables him to raise a family. To deny this, he thinks, is to reject Catholic Social Thought, and to do that is to put oneself outside the Church.

Tony Flood, who is both a believing Catholic and sympathetic to the thought of Murray Rothbard, who was a friend of his, subjects Ferrara’s book to close examination and finds it lacking.  In his book, Christ, Capital and Liberty: A Polemic Flood argues thatAustro-libertarian thought is compatible with the key teaching of the Church,  In contending that it is, Flood draws attention to the writings of the great Jesuit Father James Sadowsky, S.J., a distinguished Catholic philosopher and theologian who was also a Rothbardian in his political philosophy.

Flood analyzes in detail the errors in Ferrara’s book. In one case, for example, Ferrara included in a quotation from Murray Rothbard words that were not Rothbard’s but in fact were from a polemical discussion by Kevin Carson, a writer of different views altogether

Flood has ably shown that Ferrara’s assault on Austro-libertarianism is baseless.

 

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Cantillon and Me

10/22/2019Mark Thornton

As many of you know, I have been researching and writing about the economics of Irish economist and banker Richard Cantillon for over 20 years. He was the first to write a book about economic theory, circa 1730, coined the modern term entrepreneur, and the first to provide a supply and demand analysis of prices, as well as the basics of Austrian Business Cycle theory, along with many of the fundamental aspects of economic theory and beyond. In 2010, Chantal Saucier and I published a translation of his Essai into modern English.

Portrait of a Gentleman

I had a DNA done by Ancestry.com last year and it came back exactly as expected with the vast majority being "Irish or Scottish" and tiny amounts of western Europe and the Iberian peninsula. Today I received an update from Ancestry.com with a more refined analysis and it turns out that the majority of my DNA comes from the same place where Cantillon was born in the County Kerry area! Ancestry.com describes the area as a "perfect place for rebels and outlaws who sought refuge from British authority"!

Very satisfied with this Ancestry.com thing!

 

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California Has Tried Warrenomics. It's Been a Disaster.

California is suffering a slow but steady decline.

Bad economic policy has made the Golden State less attractive for entrepreneurs, investors, and business owners.

Punitive tax laws deserve much of the blame, particularly the 2012 decision to impose a top tax rate of 13.3 percent.

I’ve already shared some anecdotal evidence that this tax increase backfired.

But now we have some scholarly evidence from two Stanford Professors. Here’s what they investigated.

In this paper we study the question of the elasticity of the tax base with respect to taxation using microdata from the California Franchise Tax Board on the universe of California taxpayers around the implementation of Proposition 30 in 2012. This ballot initiative increased marginal income tax rates… These increases came on top of the 9.3% rate that applied to income over $48,942 for singles and $97,884 for married couples, and also in addition to the 1% mental health tax that since 2004 had applied to incomes of over $1 million. The reform therefore brought the top marginal tax rate in California to 13.3% for incomes of over $1 million.

For those not familiar with economic jargon, “elasticity” is simply a term to describe how sensitive taxpayers are when there are changes in tax policy.

A high measure of elasticity means a large “deadweight loss” since taxpayers are choosing to earn and/or report less income.

And that’s what the two scholars discovered.

Some high-income taxpayers responded to the big tax increase by moving.

We first study the extensive margin response to taxation, and document a substantial one-time outflow of high-earning taxpayers from California in response to Proposition 30. Defining a departure as a taxpayer who went from resident to non-resident filing status, the rate of departures in 2013 over 2012 spiked from 1.5% after the 2011 tax year to 2.125% for those primary taxpayers earning over $5 million in 2012, with a similar effect among taxpayers earning $2-5 million in 2012.

By the way, you won’t be surprised to learn that California taxpayers increasingly opted to move to states with no income tax, such as Florida, Nevada, and Texas.

Read More: People Love to Move to States Paul Krugman Hates Most

Oct-21-19-Destination.jpg

Other taxpayers stayed in California but they chose to earn and/or report less income.

We combine these results on the extensive margin behavioral response with conclusions of analysis of the intensive margin response to Proposition 30. …we use a differences-in-differences design in which we compare upper-income California resident taxpayers to a matched sample of non-resident California filers, for which there is relatively rich data… Our estimates show a substantial intensive margin response to Proposition 30, which appears in 2012 and persists… We find that California top-earners on average report $522,000 less in taxable income than their counterfactuals in 2012, $357,000 less in 2013, and $599,000 less in 2014; this is relative to a baseline mean income of $4.15 million amongst our defined group of California top-earners in 2011. …the estimates imply an elasticity of taxable income with respect to the marginal net of tax rate of 2.5-3.3.

In the world of public finance, that’s a very high measure of elasticity.

Wonky readers may be interested in these charts showing changes in income.

Oct-21-19-Income.jpg

By the way, guess what happens when taxpayers move, or when they decide to earn less income?

The obvious answer is that politicians don’t collect as much revenue. Which is exactly what the study discovered.

A back of the envelope calculation based on our econometric estimates finds that the intensive and extensive margin responses to taxation combined to undo 45.2% of the revenue gains from taxation that otherwise would have accrued to California in the absence of behavioral responses. The intensive margin accounts for the majority of this effect, but the extensive margin comprises a non-trivial 9.5% of this total response.

We can call this the revenge of the Laffer Curve.

By the way, it’s quite likely that there has been a resurgence of both the “extensive” and “intensive” responses to California’s punitive tax regime because the 2017 tax reform restricted the deductibility of state and local taxes. This means that the federal government – for all intents and purposes – is no longer subsidizing California’s backwards fiscal system.

P.S. Makes me wonder if California politicians will turn Walter Williams’ joke into reality.

Originally published at International Liberty
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Calvin Coolidge on the Declaration of Independence

07/03/2019Gary Galles

On July 4th, Americans celebrate our Declaration of Independence. But we often give little thought to the uniqueness and importance of our country’s founding.

To revisit those issues, we might turn to Calvin Coolidge — the only president born on the 4th of July. He honored the Declaration’s commitment to life and the liberty to pursue one’s happiness, provided others’ equally inalienable rights are not violated, more than any of his successors. He also produced remarkable results without sacrificing our freedoms — substantially cutting tax rates, tax rolls and federal debt, while real economic growth averaged 7%, with 0.4% inflation and 3.3% unemployment, during his presidency.

In particular, Silent Cal’s speech commemorating Independence Day’s 150th anniversary merits reconsideration. Consider this condensed version:

We meet to celebrate the birthday of America … a service so great, which a few inspired men here rendered to humanity … the preeminent support of free government throughout the world.

The Declaration of Independence and the Constitution of the United States … those two great charters of freedom and justice remain firm and unshaken.

A new spirit had arisen on this side of the Atlantic more advanced and more developed in its regard for the rights of the individual.

The American Revolution represented the informed and mature convictions of … independent, liberty-loving, God-fearing people who knew their rights, and possessed the courage to dare to maintain them.

The Declaration of Independence was the result of the seasoned and deliberate thought of the dominant portion of the people of the Colonies … in no sense a radical movement but … resistance to illegal usurpations … to maintain their constitutional rights which from time immemorial had been guaranteed to them under the law of the land.

The Declaration of Independence … had a much broader and deeper significance than a mere secession of territory and the establishment of a new nation … because it was proposed to establish a nation on new principles.

Three very definite propositions were set out in its preamble regarding the nature of mankind and therefore of government. These were the doctrine that all men are created equal, that they are endowed with certain inalienable rights, and that therefore the source of the just powers of government must be derived from the consent of the governed.

That our Declaration of Independence containing these immortal truths was the political action of a duly authorized and constituted representative public body in its sovereign capacity, supported by the force of general opinion … makes it the most important civil document in the world … a new nation was born which was to be founded upon those principles … an incomparable event in the history of government.

All men are created equal … they are endowed with inalienable rights … governments derive their just powers from the consent of the governed. … No advance, no progress can be made beyond these propositions.

America … has remained true to the principles which were declared 150 years ago. …The rights of the individual are held sacred and protected by constitutional guaranties, which even the Government itself is bound not to violate.

The fathers made their declaration and adopted their Constitution … to establish a free government, which must not be permitted to degenerate into the unrestrained authority of a mere majority or the unbridled weight of a mere influential few. … These are our guaranties of liberty.

Very little of just criticism can attach to the theories and principles of our institutions. There is far more danger of harm than there is hope of good in any radical changes.

The Declaration of Independence … is the product of the spiritual insight of the people. We live in an age of science and of abounding accumulation of material things…Our Declaration created them. The things of the spirit come first … to maintain the great heritage which has been bequeathed to us. … We must follow the spiritual and moral leadership which they showed.

Calvin Coolidge articulated America’s founding principles, where they came from and the dangers of moving away from them. As we celebrate another Independence Day, that understanding deserves rediscovering, because it is a far cry from the spirit animating many in America today.

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Christine Lagarde's Move from IMF to ECB is Bad for Europe

07/02/2019Tho Bishop

Earlier today, the internet was aflutter with rumors that we were on the verge of an international crisis following schedule changes involving Russian President Vladamir Putin and Vice President Mike Pence. While it appears there two events were unrelated, a different sort of tragedy struck the international stage hours later when it was announced that Christine Lagarde had been named the new head of the European Central Bank.

Joining the ECB after a lengthy stint as head of the IMF, Lagarde certainly has the resume to be the next "great" central banker. Unfortunately, she has a record of folly which we've come to expect from such a title.

In the words of our friend Mike Shedlock, "It's rare to find someone who is consistently wrong on everything. Christine Lagarde...comes close"

A conventional policymaker that fears deflation most of all, Lagarde has been a high profile defender of the negative interest rate policies we've seen doing damage in Europe and Japan. Her selection is being widely seen as an endorsement for continuing the policies of the outgoing Mario Draghi at a time when the ECB desperately needed a hawk to help defuse their trillion-Euro time bomb.

As Daniel Lacalle put it:

Read more: The ECB Continues to Incentivize Reckless Behavior by Daniel Lacalle

Earlier this year, Alasdair Macleod outlined the damage being done by the policies Lagarde is expected to continue. 

Pumping yet more credit into the Eurozone is as effective as giving adrenalin to a dead horse. Lack of credit is not the problem. Put simply, there is a global momentum of economic contraction evolving, which any business and lending banker would be foolish to ignore. There is a developing crisis, the consequence of earlier monetary inflation in the credit cycle. Economic actors may not understand the origins of the crisis, but we can be certain they are becoming acutely aware of its looming presence. And as the crisis rapidly develops, those that require additional loans will already be insolvent. 

The signal sent by the ECB to lending-bankers is likely to be misinterpreted when credit contraction is the looming threat: if TLRTO-III is the smoke, there must be a fire, possibly out of control. Better surely to call in existing loans to businesses rather than waiting to be repaid from profits unlikely to materialise. An encouragement to lend early in the credit cycle is more effective and less likely to be misunderstood than a similar encouragement later in the credit cycle. This is why a renewed TLTRO policy will almost certainly fail. 

The inability of bureaucrats, with their heads buried in spreadsheets, to appreciate the role of human psychology is not the ECB’s only failing. Its executives do not even understand what interest rates represent, thinking it is simply the price of money. This is why it believes in keeping interest rates suppressed as a means of increasing credit. Earlier in the credit cycle, rate suppression does generate some credit expansion, mainly in financial rather than non-financial activities, because lower interest rates lead to higher prices for financial assets. That is basically a spreadsheet, almost non-human function. Large industrial corporations are opportunist, borrowing to fund buy-backs and to take over weaker rivals. Smaller and medium-sized business borrowers are usually offered credit only later in the cycle, when it is a mistake to accept it.

Consequently, in a zombie economy, such as that of the Eurozone, the only borrowers are wealth-destroying, socialising, debt-entrapped governments, taking full advantage of the Basel accords, which rates them for lending banks’ purposes as riskless borrowers.

While Lagarde's appointment could be bad news for Europe's future, it will be certainly be welcomed by some.

As Fabrizio Ferrari noted last month, the big winner of a Dovish ECB appointment is the Italian government. Perhaps that's why the Italian mafia has gone back to using the lira.

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Could an Austrian Win the Battle to Replace Theresa May?

05/31/2019Tho Bishop

Following the incredible success of Brexit in 2016, British politics has become a tragedy. Theresa May has been rightfully ridiculed for her remarkable incompetence in striking a Brexit deal, but her greatest sin was her ideological commitment to preserving and growing the very sort of government interventionism that has long hindered the UK.

As George Pickering noted earlier this year:

It would…be tempting for Brexiteers to place the blame entirely on policies inflicted by the EU bureaucracy, but the truth is that harmful post-Brexit policies are equally likely to be imposed by the UK’s own government. This is particularly true for the issue of ‘regulatory harmonization’. Although UK policymakers had initially been considering significant deregulation as a possibility in the case of a no-deal Brexit, this option was taken off the table due to Theresa May’s commitment to transpose the bulk of EU regulations into British law. This would mean that, even in the event of a no-deal Brexit, UK consumers would miss out on the economic boost and quality of life improvements that could otherwise have resulted from abandoning burdensome and unnecessary EU regulations. Again however, the key point is that the true culprit is the policy of regulation itself, not Brexit, and Brexiteers should be no less quick to point this out simply because the source of the harmful policy is the UK government, rather than the EU.

While a Prime Minister with the will to follow through on Brexit would itself be an important blow against political centralism, the UK needs a bold change in ideology to truly take full advantage of the opportunity breaking away from the EU offers its people. Luckily it seems that the Conservative Party will have the option to do just that.

Former Brexit Under-Secretary Steve Baker, a favorite of our friends at Mises UK, has publicly announced he’s considering jumping in to the race to replace May. Baker’s appointment at the time was particularly noteworthy as he was perhaps the strongest EU-skeptic in parliament. His support of Leave, for example, was not simply grounded in the name of British national sovereignty, but correctly identified the EU itself as a dangerous project that should be destroyed entirely.

I think Ukip and the Better Off Out campaign lack ambition. I think the European Union needs to be wholly torn down….It was meant to defeat economic nationalism, it is therefore a failure in its own terms. If we wish to devolve power to the lowest possible level, make it accountable and move on into a free society, then it’s clearly incompatible. What I want is free trade and peace among all the nations of Europe as well as the world and in my view the European Union is an obstacle to that.

While he lacks the same degree of name recognition that is enjoyed by others like former-London Mayor Boris Johnson, Baker has created a strong following of his own among Brexiteers due to his principled stand on Brexit. He has also argued that his distance from May’s past failed deals – which were backed by not just Johnson, but other potential rivals such as Domick Raab – gives him greater credibility.

While Baker’s principled stance on Brexit is itself deserving of praise, what truly makes Baker fascinating is his familiarity with Austrian economics. As I noted when he was originally named Under-Secretary, as a Member of Parliament Baker often referenced economists such as Ludwig von Mises, Jesús Huerta de Soto and F.A. Hayek in the House of Commons. A co-founder of the Cobden Centre (named after the great Richard Cobden), he has long been a vocal opponent of the “monetary socialism” of central banks and the IMF.

As is always the case with any decent politician, Baker remains a longshot in the race to replace May. Still, the fact that his name has emerged in the conversation is a strong sign for his political future. We shall see what emerges in the coming weeks, but if there is one thing we should learn from recent Tory history – one should never rule out an underdog.

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Congress Fiddles While Trump Lurches Toward War on Iran

05/28/2019Ron Paul

Congress, and particularly the Democrat-controlled House of Representatives, seems determined to see the end of the Trump Administration before the 2020 vote. Although House Speaker Pelosi claims she is not seeking impeachment, she’s accusing the president of “covering up” something. However, she won’t say what until she can do more investigating.

But Trump’s opponents on both sides of the Congressional aisle don’t seem so enthusiastic about challenging the president when he actually does abuse his Constitutional authority to pursue a more aggressive policy overseas.

Late last week, for example, President Trump declared a national security “emergency” brought about by unspecified “Iranian malign activity” – a “loophole” allowing him to bypass Congressional review of some $8 billion in US weapons to be sold to Saudi Arabia.

Congress had been reluctant to approve yet more arms sales to Saudi Arabia after the President vetoed a bi-partisan House and Senate-approved bill requiring the US to end its military support for the Saudi war of aggression against Yemen.

What might this new Iran “emergency” be? As with the lead-up to the Iraq war, the Administration claims important secret intelligence — but of course we have to just trust them. From what we have heard from the Administration, it looks pretty flimsy. Rear Admiral Michael Gilday, the director of the Joint Staff, has outright claimed that the so-called “sabotage” of four container ships at port in the UAE is the doing of the Iranian Revolutionary Guards. But even Abu Dhabi didn’t claim Iranian involvement in the mysterious incident.

Could it have been a false flag?

Admiral Gilday also claims, without providing proof, that the recent firing of a small rocket in the general vicinity of the US Embassy in Iraq is the work of the Iranians. “We believe with a high degree of confidence that this [recent attacks] stems back to the leadership in Iran at the highest levels,” he said.

What would Iran gain by shooting off an insignificant rocket, exposing itself to US massive retaliation with no gain whatsoever? They don’t say.

 The Trump Administration has been lacking any coherent foreign policy strategy for some time. It often seems the President is fighting more with his own appointees than with his opponents on Capitol Hill. As soon as he announces that ISIS is defeated and US troops must come home, his employees like National Security Advisor John Bolton “clarify” Trump’s statements to mean that troops are staying. Trump goes to Hanoi to cut a deal with North Korea’s Kim Jong-Un and Bolton shows up with a poison pill that blows up the deal.

Bolton announced plans for 120,000 US troops to the Middle East to help push the war on Iran he’s been hocking for 20 or so years. Then we heard it was 10,000. Then 1,500, of which 600 are already there.

Whether Trump is on board or not, his Administration is clearly dragging the US into conflict with Iran. While some Members remind the president that he does not have Constitutional authority to attack Iran without approval, that argument has not been very effective in deterring presidents thus far.

If Congress really wanted to rein in an out-of-control president, they have plenty of opportunity in his bogus “national emergency” declaration and his saber rattling toward Iran. But if asserting Constitutional authority means Congress acts to pull-back US militarism overseas, suddenly there is a great bipartisan silence. They’d rather impeach Trump over his rude Tweets than over his stomping on the Constitution.

Reprinted with permission.

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Canada's Export Guarantee Program: More Risk for the Taxpayer

05/11/2019Eddie Fizor

The CBC (Canadian Broadcasting Corporation) broadcasts select NHL games on Hockey Night in Canada. These are "free” to watch on TV or stream online. "Free" is placed in quotations because the CBC’s advertises that their content services can be streamed for “free” by the public. It is worth noting that the CBC's annual share of revenue for 2018 was roughly 1.2 billion. Hockey fans may attempt to recuperate their tax dollars by watching as much hockey as possible.

The aforementioned gives context, but it is not the CBC which is the main focus of this article, but a commercial advertisement which is played during CBC’s Hockey Night in Canada.

The advertisement is for Export Development Canada (which is also funded by tax dollars).

A quote from the EDC website:

Our Export Guarantee Program can help your bank provide you with additional access to financing. We share the risk with your bank by providing a guarantee on the money you borrow, encouraging them to increase your access to working capital.

export.PNG

The Future is Uncertain

When an entrepreneur identifies a market in which they believe a profitable enterprise can be undertaken, the entrepreneur will invest their available funds. If the entrepreneur possesses insufficient funds, then a bank may choose to act as lender and direct additional funds toward what they may also believe to be a profitable endeavour.

[RELATED: "Mises Explains The Aggravating Role of Export Credit Agencies" by

In this instance, it is both the entrepreneur and the bank who will bear the risk. If the risk is too high, then the bank may choose not to loan funds to the entrepreneur.

What happens when Export Development Canada steps in to "de-risk" the project? EDC is funded by taxpayers. This means that projects will be undertaken with someone else’s money (the tax payer). Neither the entrepreneur nor the bank will fully bear the risk involved. What if the venture turns sour? EDC explains, "we share the risk with your bank by providing a guarantee on the money you borrow."

In the end, someone must bear the risk. So, who will it be?

If the entrepreneur utilizes his own funds, then he has a vested interest. This also would apply to a bank acting as lender. The claim that “risk doesn’t stop you,” identifies the  EDC not as “ risk experts,” but as “experts” in promoting risky ventures, underwritten with tax dollars.

Here's the advertisement which is aired during Hockey Night in Canada:

Risk Doesn’t Stop You When You’re With EDC

None of the entrepreneurs in this commercial appear to be concerned with risk. This should be a reason for concern on the part of the viewer. Such ads are misleading and promote a false of reality. The bearing of risk is unavoidable in any entrepreneurial endeavor. Future is uncertain. Resources are scarce.

Man shrugs his shoulders, "30,000 brake pads NO DEPOSIT. I said, why put the brakes on now?"

Indeed, why not? Why demand a deposit for surety? If the deal goes sour, someone else is left paying for your losses. It is easy to make risky decisions when the error of your way does not return upon your own head.

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Can Modern Man Re-Create Notre Dame?

04/16/2019Ryan McMaken

The Notre Dame cathedral in Paris isn't the first historically significant church to go up in smoke. The Basilica of Saint Paul's Outside-the-Walls — after standing for more than 1,400 years — was almost totally destroyed by fire in 1823. It housed the tomb of the Apostle Paul, and was a major basilica, second only to St Peter's as a pilgrimage site. Thanks to a construction worker, the church was accidently set on fire. 

Its destruction was a great disaster at the time, and an international appeal went out for assistance in its reconstruction. The world responded and the church was rebuilt to the original design. Today, it is a beautiful church, and it remains the site of the Apostle's tomb. It also still contains many works of art preserved from the Middle Ages and other elements from the original church.

Today, few pilgrims to Saint Paul's are much perturbed by the fact it is not entirely the original fourth-century structure. Most ancient churches are really a mixture of (relatively) new and much older elements. Old Saint Peter's Basilica, built by Emperor Constantine, stood for 1,200 years before being shamefully neglected and knocked down by the popes. It was replaced by the new basilica now known as (new) St Peter's. Although I personally wish the old basilica had been rebuilt — and the new basilica never constructed — few people nowadays complain about the new St Peter's value as a work of art. It has itself now become "ancient." When it comes to important churches, renovations and changes take place. It's not the end of the world. 

But maybe the destruction of Notre Dame is different. Those who built the new Saint Peter's figured they were perfectly capable of building something even better than what came before. They had Michelangelo.

But what about today? Perhaps many observers of Notre Dame's destruction suspect modern artists and architects aren't up to the task of recreating or surpassing the artisans of the thirteenth century. That would be a grim realization, indeed. 

What strikes me as especially significant about Notre Dame is that its reconstruction will have to take place in a world colored by a worldview that is far, far removed from the one that produced the original. Notre Dame was built in the High Middle Ages — an era when Europe invented the University. It was the time of Aquinas, and of Francis of Assisi. It was a time of immense interest in new technologies and new types of learning. Much of which made Notre Dame possible. It was also, of course, a time of widespread Christianity.

Europe today, however, has largely rejected Christianity and mocks it regularly in Europe's artwork, politics, and scholarship. Thus, the worldview that created Notre Dame is anathema to the modern European mind. Europeans may value the physical building that is known as Notre Dame, but Europeans have been happily burning down Notre Dame in spirit for centuries. 

Given the widespread disdain for the medievals who built it, why do we hear so much about what a wonderful thing Notre Dame is today?

The answer lies in the fact that modern Europeans have redefined the building as a safe, watered-down version of what it was meant to be. 

We're told Notre Dame is just a symbol of France, and of Europe. We're told it's a work of art, and that it's a great place for people watching. It gives us "a sense of community." And perhaps most importantly, it's a world famous tourist attraction.

Some who have pledged to rebuild the structure have been explicit in this. One wealthy donor announced today: "Notre Dame is an extraordinary landmark and an immeasurable symbol of Paris. It represents love and unity, bringing people together from all over the world no matter who they are and where they come from."

Nevertheless, for all the attempts to redefine Notre Dame today as something of non-religious importance, the fact remains the building was constructed as a church. It was made as a place to say Mass, to pray to what Christians regard as the eternal God, and to confect the Eucharist. That is, the building was created primarily to provide a holy place for the priests to participate in the process of making Christ physically present in flesh and blood on the altar. The artwork, structure, and design were all made to focus the senses and attention of visitors on this reality.

Yes, Notre Dame was also built to showcase and advertise the wealth and power of those who built it.  But this wealth and power could have been equally well advertised through the construction of palaces, and military outposts, and other civil buildings.

The fact that so many resources and so much artistic fervor were put into the construction of a church, however, reminds us that European civilization — many within it, at any rate — took their religion seriously, even if their devotion was hampered by vices such as the usual human desires for prestige and bragging rights.

But those who will rebuild the church are likely to regard New Notre Dame as something far different from a monument to an ancient deity. In reading the words above about the rituals Notre Dame was designed for, most modern day Europeans and Americans will scoff at the very idea that anyone believed in all that superstitious "god stuff." Words like "Eucharist" and "Mass" are quaint relics from absurd notions passed down by semi-barbarian medievals. (Ironically, moderns will mock medieval Europeans for their alleged ugly backwardness, even while praising their beautiful churches in the next breath.)

The contempt for the idea of Notre Dame as a place good for anything loftier than civic pride and tourism has been recently illustrated in the fact the mass media and the global pundits assign virtually no value at all to other French churches. For example, most media outlets have largely ignored the fact that French churches are increasingly targeted by vandals. According to the International Business Times:

A total of 875 of France's 42,258 churches were vandalized in 2018, with a small fire set to the Saint-Sulpice church in Paris in March, according to French police.

In the same week that the fire broke out at the Saint-Sulpice church, another 11 churches were vandalized. According to the Ministry of the Interior, a total of 1,063 anti-Christian acts were recorded in 2018 alone.

We only hear about Notre Dame because it's famous. Its status as a church is of little importance.

And this, ultimately, is what sets the reconstruction of Notre Dame apart from the reconstruction of St. Paul's or St. Peters. It will be rebuilt and placed in a culture that regards it primarily as a museum or a community center. Notre Dame has been domesticated. It's been made ideologically safe.

The way Notre Dame is treated today is not unlike what many political theorists do when they regard religion as superstitious nonsense, but nonetheless tolerate it for its supposed societal benefits. Religion, they cynically claim, can have its advantages. It keeps the rubes in line by imposing on them a moral code. It distracts the mob from their troubles. It's all fine so long as it doesn't challenge the status quo.

And who can be surprised that a French church is popularly regarded in such a way? Only 51 percent of the French population claim to be Catholic at all. Among those, only five percent attend Mass regularly. In other words, virtually no one in France is much interested in Notre Dame beyond it's mundane perks.

None of this is to say I oppose the reconstruction of the church. It's a good thing if the Church is rebuilt. It is good to have a beautiful church in the center of Paris. It's good that many people value the church on some level, even if they mock what it was intended to be.

But as I'm lectured by pundits and columnists about the need to value Notre Dame as a symbol, I can't help but think of the Catholic novelist Flannery O'Connor who took exception to the idea that the Eucharist was a mere symbol, and not the flesh and blood of the Christian God:

Well, toward morning the conversation turned on the Eucharist, which I, being the Catholic, was obviously supposed to defend. Mrs. Broadwater said when she was a child and received the Host, she thought of it as the Holy Ghost, He being the ‘most portable’ person of the Trinity; now she thought of it as a symbol and implied that it was a pretty good one. I then said, in a very shaky voice, ‘Well, if it’s a symbol, to hell with it.’ That was all the defense I was capable of but I realize now that this is all I will ever be able to say about it, outside of a story, except that it is the center of existence for me; all the rest of life is expendable.”

This sort of radical devotion on the part of O'Connor will strike most modern Westerners as unpleasantly radical. Perhaps even extreme. Or worse yet: intransigent. We're not supposed to have convictions like this anymore, or take religious propositions seriously. That's all for a past "dogmatic" age we're now supposed to condemn. And it is condemned, by exactly the sorts of people now singing the praises of Notre Dame. They tell us the most important thing about Notre Dame is that it's a symbol. Flannery O'Connor might have disagreed. 

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