Am I my brother’s keeper? Love your neighbor as yourself; but who is my neighbor? How do we bear one another’s burdens and so fulfill the law of Christ (Gal. 6:2)? These are questions individuals, communities, and the larger society have wrestled with since the beginning of time. Answering these questions in economically sustainable, just, peaceful and cooperative ways is an ongoing personal, community, and societal need, particularly for Christians.
The central concept of fraternal benefit (or mutual aid) societies dates back into ancient times as one practical solution to this challenge. In America, during the 19th and 20th centuries, fraternal societies often described their purpose as guarding one another from the degradation of charity. This is a concept we don’t discuss much anymore; but should we? Yes, perhaps now more so than ever as society is shifting more economic risk to individuals and social capital is changing.
Community development organizations that have an operating model of “hand up, not hand out” are the bedrock of dignified (rather than degrading) care for one’s neighbor. While handout systems are critical in short term emergency or disaster situations, they quite easily become snares and move toward degradation of spirit, image, and will.
Positive social and economic capital is created when Christians organize, join, and promote cooperative mutual aid, and participate in acts of generosity in taking care of their neighbors in need through dignified community development.
A working definition
We define fraternals as a system of local organizations (chapters or lodges) organized for:
- members having an opportunity for input in the organization and leadership development
- mutual aid (strong helping the weak), mutual defense, and proportional benefits
- educating others about a group’s interest and support for the common bond
State and federal statutes created “modern” fraternals, which grew out of the social experience of the mid-19th century. Even so, various forms have existed since ancient China, Greece, and Rome. In Europe, they arose out of the guild system or friendly societies. Most American fraternals developed as social businesses providing then-innovative solutions to the lack of market and government programs for immigrants and the mass market. The winning formula was to create associations of groups with common bonds, leveraging trust to create economic capital cooperatively.
How was this accomplished?
Fraternals developed by drawing from preexisting social capital within affinity groups and creating new social capital on behalf of and within those groups. Economic capital emanated following the creation, leveraging, and expansion of social capital within each affinity group. When a member got sick or died, that person’s costs would be paid for by the other members. Ultimately, most fraternal societies provided insurance as a social good. Wealth grew equitably within the affinity from risk sharing and encouragement of positive social behaviors such as thrift, delayed gratification, and generosity.
Thrivent has relied on business services as the sustaining economic engine for the social movement of Christian stewardship. Knights of Columbus not only provides business services (via insurance), but also relies in part on direct support (“donations”) from the Catholic Church, as well as a focus on new member dues generation at the local level.
What happened to the fraternals?
Historians have offered alternative interpretations about the diminished influence of fraternals in America. These include:
- Changing social support from mutual aid to government agencies and charities with everdecreasing social stigma1
- Employer benefit programs: “group insurance caught fraternal societies off guard”
- Increased regulatory and professional pressures
- Economic success within immigrant communities
Is it time for revival of Christian mutual aid societies?
For social business models to coalesce, they must develop and sustain both economic resources and social capital. Typical economic engines for the support of social movements include business services, membership dues, and donations. Social businesses tend to be slow growth because they generally are required to generate capital from operations or debt rather than venture capital. Is there another source of capital that could spur faster growth?
We are beginning to see the emergence of Christian Health Sharing Networks, growth in existing Christian fraternal societies, and other new forms of mutual aid in peer to peer lending and insurance. Most, but not all, follow in the tradition of mutual aid. Are there other areas where mutual aid makes sense? Should we find ways to promote this growth even more?
DIGNIFIED COMMUNITY DEVELOPMENT
Avoiding the degradation of charity
Much of our culture celebrates charity—giving to help someone in need. We know in our fallen world that charity will be required for neighbors in need. Yet just as mutual aid was created to avoid the degradation of charity, some charitable aid organizations are doing the same. Because of the need for brevity we will not explore the history of dignified community development, which in many ways follows the same path as fraternals. In his book Beyond Charity, John M. Perkins argues that redistribution aid in the form of a handout, whether from a government program or a church, in most cases is not a good way to truly love our neighbor as ourselves. Perkins goes on to outline the principles of Christian community development that leads to dignified aid.
In the last 10 years Thrivent members have provided over $200 million in financial support to Habitat for Humanity, in addition to countless volunteer hours. Why did this happen? As we help our members be wise with money we want them to give to organizations that promote the “hand up, not hand out” approach. Habitat is a great example of an organization that promotes and delivers dignified aid.
In Bowling Alone, Robert Putnam convincingly illustrates a quickening sunset for civic participation in America. Putnam’s primary contention is that social capital is breaking down at a macro-level in the United States. While the ultimate meaning of social capital is debated, there is reasonable consensus that it equates to connections among people creating networks that result in value.
Francis Fukuyama defines social capital as “an instantiated informal norm that promotes cooperation between two or more individuals.”
In Fukumaya’s view, those norms may be as simple as reciprocity among friends or as complex as “articulated doctrines like Christianity or Confucianism.” The result of social capital may be trust, networks, and/or civil society.
Why should we care?
Economic functions and outcomes of social capital illustrates why we should care. In Fukuyama’s view, social capital “reduces[s] transaction costs associated with formal coordination mechanisms like contracts, hierarchies, bureaucratic rules, and the like.”
We have found that by helping Christians participate in mutual aid within their affinity and promote dignified community development for those in need outside their affinity, social capital and economic wellbeing have increased. At a macroeconomic level, this is critical for competitive sustainable capitalism.
A CLOSING OBSERVATION
Managing a social business requires careful balance of a good economic engine, a clear social mission, and the right timing. Walter Basye argued that guilds crumbled because they were too business focused: as greed took over, guilds were ruined. In contrast, he argued that many friendly societies were ruined because they were too social—they did not pay sufficient attention to their economic engines.
Writing in 1919, Basye closed his history with the following observation: “The future of the fraternal system has never before been so bright.”8 Fast forward to the turn of the 21st century when Beito closed his work with this observation: “Mutual aid was a creature of necessity. Once this necessity ended, so, too, did the primary reason for the existence of fraternalism. Without a return to this necessity, any revival of mutual aid will remain limited.”
While Basye’s optimism grew out of the fraternal system’s ability to stave off the economic threats, Beito’s pessimism stems from the weakness of social capital and diminished need.
Only recently has insurance become viewed as a necessary evil rather than the social good it is. We are seeing that redistribution aid schemes without relationship and responsibility aren’t effectively helping to eliminate poverty. Right now in the Christian community we have strong social capital, growing economic necessity for mutual aid, and more resources than ever to change circumstances for those in need. This white paper is not intended to offer specific conclusions. Rather, it is intended to invite an opportunity for reflection on important questions about economically sound ways of bearing each other’s burdens.