JTR, the reason that you are in the situation you are financially is that you have practically no flexibility. You live in one of the most expensive places in the US, look for work that matches your skills as opposed to getting skills that match available work, and limit your mobility significantly (and therefore your scope of employers). This is fine for you, as it is a luxury that you can afford, but it is hardly a circumstance that warrants govt. support. I'm not saying that you claimed otherwise, just making sure that we are using the same language to describe the same things.
First off, relocation is out of the question. I know myself well enough to know I couldn't stand living anywhere but a large city. I went to a college in NJ. After 3 semesters I stopped sleeping there and started commuting because I just couldn't take the boredom of being in a small town any more. I can't change that. Furthermore, I absolutely would hate living in a place where I'm wedded to an automobile. They're expensive, noisy, smelly, finicky, dangerous pieces of machinery. I get car sick on anything but the shortest rides, so to me they don't even register on a list of transportation options. To me it seems totally unnatural to not be able to walk to most places. I remember once on a business trip to Virginia trying to go for a walk from my hotel. I never felt so isolated in my life. The whole place was designed for the convenience of cars, not people. I don't know how people can live in a place like that. The adjustment is just something I can't make. I also like to give myself some chance of maybe eventually hooking up with someone. This means living in a place where the numbers game is in my favor. Small towns are out then. Besides, last I checked relocating would run me something like $50,000 between moving expenses and setting up a new place. That means probably five years or more after counting living expenses to have a chance of breaking even. I'd be better off taking that same $50,000 and just investing it.
As far as employment goes, I'm stuck with what's available here, and that's mostly $10 an hour service jobs. There's no skills to develop to match the available work. Rather, there's no point to even bothering since it's all dead end. The local economy is mostly service sector, and service sector pays low. Believe me, I took jobs out of my field. In fact, those same jobs are what gave me the carpal tunnel syndrome. And that leads me to the fact that because I have CTS I'm pretty much unable to work any job full-time. It's been that way since about 1990.
Scheduling is another problem. Again, I'm mostly stuck with the day jobs here. I hate it with a passion since I'm a night person. I read about all the things people here do when they're not at work and I'm amazed they have the energy level to do them. When I was stuck working a day job I was totally spent after the work day. Weekends were mostly sleeping extra so I had enough energy to get through the week. In short, working full-time for me meant having no other life or hobbies. I just didn't have the energy for it. Three years ago I helped my friend at the taxi place for a month during the rate change. I was exhausted afterwards and it took me three months to start feeling normal. I don't have such a chronically low energy level when I adjust my schedule to be up nights but even then it's not that great. I've always had this problem, BTW. In school I was spent after the week whereas many of my peers weren't. I'm sure that hurt me in many ways as well. It's not a health issue, either. It's just part of my psysiological make-up (low body temp, low energy level). My dad was the same way. I think many of the people we accuse of being "lazy" just plain don't have the energy level to work a full-time job. Not their fault, really. I also almost forgot to mention since you were talking about limiting my mobility that driving to work on a day shift would be impossible for me, even without CTS. At that time of morning, by luck I find my way to the bus which takes me to the subway. I tried once biking to work. After only two blocks I nearly had or caused a bunch of accidents, hit a pedestrian, and did a few other really stupid things. The brain and reflexes just plain don't work for me that time of day. I turned around and took the bus instead. In a car I have little doubt I would kill someone or get killed myself within a week. So regardless of locale, working a day job for me requires taking public transit.
Anyway, given these circumstances, I'm doing the only thing that makes any sense-self-employment. Sure, eventually I can develop skills which might bring me more money but that's not really the main problem. In fact, since my current skills are worth $40 to $60 an hour depending upon the work and the client I think that's more than good enough. The main problem remains getting more clients. That's a matter of time. CPF has been helpful in that regard. I can't think of any other way, really. Advertising is beyond my budget. It probably wouldn't work too well anyway given my rather specific abilities. And at this point in my life getting the house cleaned up is more important than earning money. I can't work at all in this type of environment (how the basement looked shortly after my father died):
Finally, I'm the type of person who couldn't care less about money or material things anyway. That gives me little incentive to do something I don't want to do just to satisfy society's desire that I be productive. My sole reason for earning any money at all is to save it so I don't have worry about earning it any more. Unlike many others who wouldn't know what to do if not for work, I'll be happy if the day comes when I can say I'm retired and comfortable. Really, the main obstacle right now is buying a house, preferably the one I'm living in. Once that's done, and I have maybe another $300K in investments for the $15K I need to maintain it, I'm all set.
Regarding distributism-you can't just give people the means to production. You have to teach them how to use them. That's undoubtedly most of the problem in the example you gave. You can't expect people who were never farmers to magically know what to do with the land. We've grown vegetables for years but I bet we would still be clueless if given a full-fledged farm.