Catholic Economics, Part 6: How Much We’ve Lost

Letting our Pope Emeritus Benedict XVI have the last word.

This is the final part of a six part series on economics and Catholic social teaching. (Part 1, Part 2, Part 3, Part 4, Part 5)

In the earlier parts of this series we’ve tried to get at Catholic Social Teaching using broad strokes: First, we examined the distorted lens through which we tend to view economic history. Next, we tried to overcome that historical prejudice by taking a look at the economic arrangements of the Middle Ages. Then we moved through several foundational concepts like rights, property, and the lost distinction between justice and charity.

In this final piece, we’ll proceed through a few reflections from the 2009 encyclical Caritas in Veritate. This will allow us to mention a variety of principles with brevity, even though they each deserve a study all their own. Also, because Caritas in Veritate is the most recent addition to that body of Catholic Social Teaching, it represents a timely and comprehensive synthesis. Emphasis in all quotes is original. And so, in numbered fashion…

1) There is such a thing as the “common good,” and it is not okay to ignore it:

Besides the good of the individual, there is a good that is linked to living in society: the common good. It is the good of “all of us”, made up of individuals, families and intermediate groups who together constitute society…To desire the
common good and strive towards it
is a requirement of justice and charity…The more we strive to secure a common good corresponding to the real needs of our neighbours, the more effectively we love them. Every Christian is called to practise this charity, in a manner corresponding to his vocation and according to the degree of influence he wields in the
pólis. (p. 7)

2) Vast inequality is bad, not just for the poor, not just for the aforementioned common good, but even for the economy itself. It is bad for everyone:

Through the systemic increase of social inequality, both within a single country and between the populations of different countries (i.e. the massive increase in relative poverty), not only does social cohesion suffer, thereby placing democracy at risk, but so too does the economy, through the progressive erosion of ‘social capital’: the network of relationships of trust, dependability, and respect for rules, all of which are indispensable for any form of civil coexistence. (p. 32)

3) Usury is still a thing. We might be wise to have more conversations about what this means for us. Also, there is a connection here with the so-called “preferential option for the poor”:

…financial difficulties can become severe for many of the more vulnerable sectors of the population, who should be protected from the risk of usury and from despair. The weakest members of society should be helped to defend themselves against usury, just as poor peoples should be helped to derive real benefit from micro-credit, in order to discourage the exploitation that is possible in these two areas. (p. 65)

4) The notion that “the threat of unemployment is necessary because it motivates men to work who would otherwise remain unproductive” is a piece of stultifying propaganda. Don’t get played:

Economic science tells us that structural insecurity generates anti-productive attitudes wasteful of human resources, inasmuch as workers tend to adapt passively to automatic mechanisms, rather than to release creativity. On this point too, there is a convergence between economic science and moral evaluation.
Human costs always include economic costs, and economic dysfunctions always involve human costs. (p. 32)

5) There is no invisible hand. In order to guide its progress, ensuring that its goals remain healthy and its means appropriate, political authority plays a necessary role in the economy:

Economic activity cannot solve all social problems through the simple application of
commercial logic. This needs to be
directed towards the pursuit of the common good, for which the political community in particular must also take responsibility. Therefore, it must be borne in mind that grave imbalances are produced when economic action, conceived merely as an engine for wealth creation, is detached from political action, conceived as a means for pursuing justice through redistribution. (p. 36)

6) On that note, it is also important to re-emphasize that purposeful “redistribution” is a valid pursuit, although, just like any other valid pursuit, it can be pursued improperly. See also paragraphs 36, 37, 39, 42, and 49.

7) Environmental concerns are not non-economic, nor are they an afterthought. They are integral to social life and tied to a proper respect for life, which is to say all life. This is not because man, animal, and plant are all on the same ontological plane, but because:

The way humanity treats the environment influences the way it treats itself, and vice versa. This invites contemporary society to a serious review of its life-style, which, in many parts of the world, is prone to hedonism and consumerism, regardless of their harmful consequences…If there is a lack of respect for the right to life and to a natural death, if human conception, gestation and birth are made artificial, if human embryos are sacrificed to research, the conscience of society ends up losing the concept of human ecology and, along with it, that of environmental ecology. It is contradictory to insist that future generations respect the natural environment when our educational systems and laws do not help them to respect themselves. The book of nature is one and indivisible: it takes in not only the environment but also life, sexuality, marriage, the family, social relations: in a word, integral human development. Our duties towards the environment are linked to our duties towards the human person, considered in himself and in relation to others. It would be wrong to uphold one set of duties while trampling on the other. (p. 51)

8) Man is obliged to respect all life and to seek the good of his neighbor for a very simple reason, which is that he needs a relationship with his neighbor in order to realize a truly human existence. This is a bit difficult to accept, especially for introverts such as myself, but a man can deny it only to his own ruin:

One of the deepest forms of poverty is isolation…As a spiritual being, the human creature is defined through interpersonal relations. The more authentically he or she lives these relations, the more his or her own personal identity matures. It is not by isolation that man establishes his worth, but by placing himself in relation with others and with God. Hence these relations take on fundamental importance. The same holds true for peoples as well…the human community does not absorb the individual, annihilating his autonomy, as happens in the various forms of totalitarianism, but rather values him all the more because the relation between individual and community is a relation between one totality and another. (p. 53)

9) Human life is a moral affair, and there is no amount of scientific explication, no amount of demonstrated mechanism, no amount of self-interested wealth creation, that can absolve us of this fact. Man will never achieve that sought-after dream in which he can be good without having to be moral:

It is good for people to realize that purchasing is always a moral — and not simply economic — act. Hence
the consumer has a specific social responsibility, which goes hand-in- hand with the social responsibility of the enterprise. (p. 66)

10) In summary, everything in a properly understood economy pivots around justice. But in order to understand what this means we must first see justice in its fullest sense, and not simply from one angle or in part. To say it another way, we must learn to acknowledge all kinds and degrees of justice, and not just the justice of contract or exchange:

The market is subject to the principles of so-called
commutative justice, which regulates the relations of giving and receiving between parties to a transaction. But the social doctrine of the Church has unceasingly highlighted the importance of
distributive justice and
social justice for the market economy, not only because it belongs within a broader social and political context, but also because of the wider network of relations within which it operates. In fact, if the market is governed solely by the principle of the equivalence in value of exchanged goods, it cannot produce the social cohesion that it requires in order to function well. (p. 35)

This final point hints at the key to our contemporary economic bewilderment. We have lost justice, or at least we’ve had our notions about justice reduced and impoverished. We seek justice, most of us, but only in part, blindly, and haphazardly.

For example, some seek social justice, but think that commutative justice is their enemy. Others recognize commutative justice, but see social justice as a fraud. Both undermine themselves from the start.

In light of this situation, we might truly say that the whole problem of our age is just this sort of accidental reductionism—an all encompassing tendency toward nothing-but-ness in our thinking, to the expense of the whole truth:

Descartes reduced philosophy to mathematics; Newton followed by reducing physics to mechanics; Luther reduced theology to the solas; Freud reduced mind to instinct; Locke reduced politics to liberty; and Adam Smith—as you might now be able to guess—ended by reducing the economy to self-interest and calculation.

Consider this: Aristotle, Augustine, and Aquinas had been meticulously assembling and systemizing economic wisdom by the time Smith penned Wealth of Nations. They had studied and organized all economic actions comprehensively into four categories: production, exchange, distribution, and consumption. They had a theory which accounted for the whole.

What did Smith add to the edifice? He certainly added nothing, as others have observed. Rather, he subtracted, as his predecessors had taught him. By the time he was done boiling things down we were left only with two parts: production and exchange. Half of the picture was thenceforth to be denied as non-economic. The modern economy is the result.

Many seem to think that the popes and their encyclicals just want to rob humanity of some great idea it has developed, and to impoverish its wonderful system. But in the end, anyone who looks at the history of ideas cannot help but see that precisely the opposite is true: man has already been robbed of much wisdom in almost every area of human knowledge. Modern man is deprived and impoverished, in some way, in almost every science.

The popes want nothing more than to give man back his wealth; to restore to him what was lost; to make him rich again. They want to “baptize” this economy which is right now dead and broken, because they know that is a thing made, not of ideas and mechanics, but of men with souls.

Daniel Schwindt is a member of the Solidarity Hall thinker-space, and the author of several books including Holocaust of the Childlike and The Pursuit of Sanity.