In capitalism it is assumed that one can obtain productive property, but that is generally not the case, most families are dependent on a wage to pay rent (even on property they “own” via a mortgage), car loans, student loans (if they are upwardly mobile). In other words, “The cake is a lie”.
But is this really inevitable? I’ll agree that it isn’t easy to do without a car loan or at least significant student loans. But it can be done. Mortgages on houses are hard to avoid, I’ll grant. I maintain that people can obtain productive property, but that it’s extremely difficult to do unless one cuts back on one’s expectations and particularly on one’s borrowing.
I maintain, too, that it’s often an inter-generational thing. My earnings have always been on the modest side, relatively speaking. But of all my now adult children, only one has any school debt, notwithstanding that all but one also went through graduate school. One owes about $12,000 and another owed about half that but has now paid it off. How did they do that? Well, they hunted scholarships for one thing. Some got big ones, some didn’t. Those who didn’t fare so well went to state schools where tuition was, frankly, quite low, and concentrated on graduate school. Two of them got scholarships to grad school by selecting relatively new schools (which tend to be more generous than well-established ones) All of them worked, and raised a few head of cattle on the side, which they then sold to help pay for school. (We’re now starting over with cattle for grandchildren) Also, my wife and I did without in a thousand ways, because we couldn’t stand the thought of their graduating with huge debts. I haven’t had a car loan for decades, because I always buy used cars of significant vintage and run the wheels off them. Bought “junkers” for my kids to go to grad school, because all “school cars” get torn up anyway. New tires and oil changes are cheaper than new cars. Our house wasn’t new when we bought it. I repainted it myself (the high eaves were thrilling to paint, I’ll admit. It’s two-story.) We never eat out unless it’s someone’s birthday, and even then we usually don’t. I travel a lot on day trips, and buy the $1.00 meals and carry my own water with me to drink with it. I take my lunch to work every day, even though I now own my own business and could easily afford to eat at the very nice place right across the street.
And we’re probably not all that good at it. I’m not representing that we are. But we have acquired a few things along the way. One rule is that we never borrow to consume, but never hesitate to borrow in order to invest, particularly when that investment can be deducted in full or very largely short-term. The way I look at it, when I buy mother cows, for instance, the government is paying 1/3 to 40% of the cost, because of the deduction. Land rental is laughably inexpensive. Maybe none of my children will raise cattle “on the side”, (though one does and I think some of the others will in time) but they all know how, and my grandchildren are learning. Learning one or two investment vehicles well and not hesitating to borrow to follow them makes a lot of difference, particularly if some acquirable skill is required in making them work. We’re not wealthy, but except for just a few “tricks”, and living below our means, we wouldn’t own much more than our house and cars either. I learned cattle, the real estate market, the poultry market and how banks work. I concentrate on those things. I don’t know anything outside my “day job” other than those things. I wouldn’t know a good tech stock from a bad one. But I don’t have to.
We’re not all that talented. We really aren’t. I’m only saying this stuff because I really want people to understand that they actually can acquire some things in life. But you have to give up a lot of things that seem important at the time but really aren’t, and you have to understand that some generation or other has to provide a little “seed stock”, as it were, to help things along for the next generation, unless one generation is extraordinarily talented or lucky.
And I know not everybody can raise cattle. That’s just an example. I bought a bobcat for farm use, and there’s a strong market for landscaping, and people pay handsomely for it. I could do that and make money doing it if I wanted to, because I have learned to operate it very well. (And the cattle do take up my spare time.) And, yes, the government paid about 35% of the cost of the bobcat, in effect, because of the deduction. Yup, I borrowed the money to buy it, but I have paid it off. You can do that if you drive an old car for which you paid cash. You can earn money with a bobcat, but not with a new car. And you can’t deduct what you pay for the car, or the interest on the loan either. I do know a guy who does landscaping with a bobcat, and he does pretty well. On a more modest level, I know a guy who bought one of those really nice mower tractors, a bat-wing mower attachment, a fertilizer spreader, a good weed-eater and a hedge clipper. He does lawn maintenance on weekends and gets paid well for it because he is really good at it, and fast. He was able to deduct the cost of his equipment, of course. Anybody who wants to badly enough can do things like that.
If you wait for the system to make Distributism possible for you, you’ll be waiting forever. It’s not so inclined. You have to make it happen yourself.
