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November 3, 2014 issue

Market Assumptions : Pope Francis’ challenge to income inequality

Robert W. McElroyOctober 23, 2014
NAMESAKE. Pope Francis leads a meeting with the poor in the archbishop’s residence in Assisi, Italy, Oct. 4.

In a tweet read around the world this past April, Pope Francis told over 10 million online followers, in nine different languages, “Inequality is the root of social evil.” The pope’s diagnosis did not go over well with many American Catholics, who criticized the statement as being radical, simplistic and confusing. This pushback stands in stark and telling contrast to the otherwise enthusiastic reception the new pope has met in the United States. From the moment of his election, Pope Francis has captured the attention of the American people with his message and manner, even as he has challenged us all to deep renewal and reform in our lives. Americans take heart in the pope’s call to build an ecclesial culture that casts off judgmentalism; they applaud structural reforms at the Vatican and admire Francis’ continuing focus on the pastoral needs of ordinary men and women.

But that Francis’ teaching on the scandal of economic inequality in our world has inspired a decidedly mixed response has not deterred the pope from speaking on this theme, one very close to his heart, repeatedly and forcefully. What Pope Francis tweeted in just seven words he had elaborated on at length five months earlier in his apostolic exhortation, “The Joy of the Gospel” (No. 202):

The need to resolve the structural causes of poverty cannot be delayed.... As long as the problems of the poor are not radically resolved by rejecting the absolute autonomy of markets and financial speculation and by attacking the structural causes of inequality, no solution will be found for the world’s problems, or, for that matter, to any problems. Inequality is the root of social ills.

Pope Francis identifies this inequality as the foundation of a process of exclusion that cuts immense segments of society off from meaningful participation in social, political and economic life. It gives rise to a financial system that rules rather than serves humanity and a capitalism that literally kills those who have no utility as consumers. Inevitably, such exclusion destroys the possibility for peace and security within societies and globally. The cry of the poor captured in “The Joy of the Gospel” is a challenge to the “individualistic, indifferent and self-centered mentality” so prevalent in the cultures of the world; it is a call to confront the evil of economic exclusion and begin a process of structural reform that will lead to inclusion rather than marginalization.

Commentators from the worlds of politics, economics and business have weighed in to identify the defects and limitations of the pope’s prescription for justice in the world. Some of these commentaries have been superficial and highly politicized; others have been thoughtful and incisive. The emergent critique of Pope Francis’ message about inequality focuses on three major themes. The first is that the pope does not understand the importance of markets. The second is that Francis’ critique is aimed at a type of capitalism far different from the economy of the United States. The third is that the pope’s perspective has been skewed by his Latin American roots and is out of step with the teaching of prior popes. Thus Francis’ criticisms of world economies are alternatively naïve or misplaced or doctrinally extreme.

But a sustained reading of Pope Francis’ words on inequality and the barrage of criticism that has greeted them raises another possibility, namely, that the backlash against the pope’s message did not arise because he failed to recognize the centrality of markets, the nature of economies like the United States and the trajectory of authentic Catholic social teaching, but precisely because he did recognize the realities, and in doing so has raised fundamental questions about justice and the American economic system.

Specifically, the pope’s writings on inequality and economic justice point to the fallacies inherent in a series of major cultural assumptions that are deeply embedded in American society. These assumptions touch upon the meaning and significance of economic inequality itself, the moral standing of free markets and the relationship between economic activity and membership in society. Only by examining the legitimacy of each of these assumptions in turn can the importance of Pope Francis’ critique and challenge be appreciated. Only by examining the cultural mindset that these assumptions taken together have created can it be understood why they collectively undercut the possibility for greater justice in the American economic system and world community today.

The Natural Order

The first cultural assumption is that current levels of domestic and international economic inequality are a natural part of healthy economic life. The logic behind this assumption is simple: Any economic system that seeks to enhance growth must incentivize individual initiative and effort. For this reason alone, economic inequality will be evident and substantial in every nation that values growth and opportunity.

Economic inequalities are natural, under this assumption, in another more fundamental sense as well. Economic inequality arises from the right of men and women to use their talents as they choose and from the claims of justice that reward individuals for their contributions to specific enterprises. Societies may have an obligation to provide a threshold of economic support to their citizens, but to go further and seek to limit economic inequality would not only cripple economic growth but violate fundamental norms of justice.

But in Catholic thought this assumption, which is so comforting for American culture, is utterly unacceptable. Catholic thought begins not with the need to maximize economic growth or with individual claims to recompense, but with the equal dignity of every man and woman made in the image of God. In the words of the Second Vatican Council’s “Pastoral Constitution on the Church in the Modern World” (No. 29):

Their equal dignity as persons demands that we strive for fairer and more humane conditions. Excessive economic disparity between individuals and peoples of the one human race is a source of scandal and militates against social justice, equity, human dignity, as well as social and international peace.

Grave inequalities within and among nations are automatically suspect in Catholic thinking and constitute not the legitimate natural order but a profound violation of that order.

It is vital to note that the council is not talking about the less-controversial right to some minimum threshold income in this passage; it is explicitly talking about disparities in income. Catholic teaching has long recognized that the most profound harms of economic inequality lie not merely in the material realm but in the social, psychological and political effects that flow from great economic inequalities. Those who are marginalized economically are also marginalized educationally, residentially and in their opportunities for meaningful work. As a result, as Pope Francis concludes, they are actually excluded from society: “Exclusion ultimately has to do with what it means to be a part of the society in which we live; those excluded are no longer society’s underside or its fringes or its disenfranchised—they are no longer even a part of it. The excluded are not the exploited, but the outcast, the ‘leftovers.’”

Pope Francis’ assertion that egregious levels of inequality constitute a profound injustice rather than a necessary part of the natural order is the central friction that underlies the rejection of the pope’s message within the United States. When the richest nation on earth has the highest level of post-tax-and-transfer income inequality among highly developed countries, that is injustice, not the natural order. When the 85 richest individuals in the world have more wealth than the 3.5 billion poorest, that is injustice, not the natural order. The cultural currents in American life that treat grotesque levels of inequality as inevitable in a market economy constitute an ideology of justification and complacency, and they are irreconcilable with the sense of complicity in injustice and the imperative to reform that flow from any meaningful application of the Gospel to economic relations in our world.

The Sacred Market

The second cultural assumption widely held in the United States is that the freedom of markets is a categorical imperative rather than an instrumental freedom. No element of Pope Francis’ teaching on justice and the economy has received more criticism than his call for rejecting the absolute autonomy of markets. Defenders of American capitalism have advanced two separate arguments to counter the pope’s critique. The first is that the economic systems in the Western world are not in fact absolutely autonomous but instead are subject to regulations that safeguard important human rights. The second is that the free market is the best engine for generating wealth for all segments of society and for embodying the fundamental human right to contract and undertake economic initiative.

Both of these arguments have important elements of truth. Western markets are not free in an absolute sense but reflect elemental safeguards for human dignity. In addition, markets are a central mechanism for the wealth creation that has lifted millions of people out of poverty over the past several decades, especially in China and India. Finally, free markets do express and nurture the important human freedom of economic initiative and contract. For all these reasons, relatively free markets are conducive to establishing economic justice in the world.

But as Catholic social teaching has made clear throughout the past half century, free markets do not constitute a first principle of economic justice. Their freedom is merely instrumental in nature and must be structured by society and government to accomplish the common good. In “Centesimus Annus,” in which St. John Paul II skillfully integrated a modern appreciation for markets into Catholic social teaching, he made clear that any market system must be “circumscribed within a strong juridical framework which places it at the service of human freedom in its totality, and which sees it as a particular aspect of that freedom, the core of which is ethical and religious.” And pointing to the wreckage of the financial collapse of 2008, Pope Benedict XVI observed in “Charity in Truth” that both distributive and social justice are essential to complement the commutative justice of markets, because “if the market is governed solely by the principle of equivalence in value of exchanged goods, it cannot produce the social cohesion that it requires to function well.” The sustained conviction of Catholic doctrine is that the dignity of the human person is the mean and the measure of every system and institution, and that markets must be structured to reflect that perspective.

It is in light of this fundamental stance that Pope Francis speaks to the question of markets and condemns the absolutism of those who resist structural reforms that will bring greater fairness and serve human dignity. He identifies a “sacralized” approach to existing market structures, which resists all calls for change and reform in the name of freedom and efficiency. Seen through this sacralized prism, any attack upon the status quo is portrayed as a pathway to state centralization, an encroachment upon personal freedom or an invitation to economic stagnation.

This same sacralization of free markets has marked the pushback faced by every major reform moment in American economic history—during the Populist and Agrarian reform movements of the 19th century, the Progressive reforms of the early 20th century and the reforms of the Great Depression. At each of these moments, those seeking reform were met with an absolutist defense of the markets that labeled any alteration in market structures as an assault on freedom and prosperity. Ironically, it is these same reforms that market defenders point to proudly today as evidence that our market structures are not absolutist.

The freedom of markets is essential to a vibrant and just economy, but it is an instrumental freedom, not a categorical imperative. Markets exist to serve the human person and human communities. It is the obligation of society and government to structure markets so that they best carry out that role.

Makers Versus Takers

The final cultural assumption is that there is a fundamental divide in American society between those who contribute to society economically and those who do not. This trend was captured in a narrative that emerged in the 2012 presidential election that there are two groups in America: “the makers” and “the takers.” “The makers” are those who pay more in taxes than they receive in government benefits. “The takers” are those who receive more in benefits than they pay in taxes. While there was a great deal of imprecision about what benefits counted in this calculation and whether those who had contributed economically in the past but were now retired or disabled should be counted as “takers,” the overarching theme was that a large segment of American society continually drains the American economic system.

This theme has been accentuated by the growing levels of inequality in the United States, and the decreased economic mobility of those born into the lowest income quintile of the population. As a consequence, the very exclusion that Pope Francis warns of has eroded public discourse and unity within American society. The poor, who were a central focus of political action and public concern during the 1960s and ’70s, have now been swept to the side of public debate. Programs that benefit the poor must be justified by their collateral benefit to the middle class. And a commonly unarticulated, yet deeply resonating theme of this cultural shift is the notion that the poor are largely responsible for their own poverty.

The notion that a society can be divided into “the makers” and “the takers” embodies precisely the individualism that Pope Francis condemns. It asserts that wealth creation is an individual undertaking, ignoring the enormous role that societal contributions make to every business enterprise. It is a denial of the core assertion in Catholic teaching that all creation was created by God and given to humanity, collectively, and that material goods have a universal destination that must not be undermined. The ideology of makers and takers regards market outcomes not merely as an efficient first-level filter through which material goods are distributed in society but as a moral arbiter of worthiness, effort and talent. And it constitutes a subversive influence in American society, one that sows division and discord.

One great irony of the myth of the makers and takers is that structures of inequality have raised enormous obstacles to meaningful job opportunities for so many young men and women. Pope Francis has pointed repeatedly to this dearth of productive jobs, saying:

We cannot resign ourselves to losing a whole generation of young people who don’t have the strong dignity of work.... Not having work does not just mean not having what one needs to live...the problem is not being able to bring bread to the table and this takes away one’s dignity.

Unless structural economic reforms are undertaken to remedy existing obstacles to greater employment, the cycle of economic and social exclusion that is at the center of the pope’s challenge to existing economies will only increase.

The United States, over the course of its history, has harnessed individual creativity, vast natural resources, market freedom and social cohesion to produce the most powerful economy the world has ever known. But like the rich man in the parable of Lazarus, we are blinded to our obligations to the poor and the marginalized by cultural assumptions that are irreconcilable with the Gospel. In the United States, these distorted assumptions convince us that extreme poverty is inevitable in our nation and our world, that structural reforms of our markets will decrease growth dramatically and lead to the centralized state and that the poor deserve the hand they have been dealt.

Pope Francis, in his vision of the inclusive society, has given us the opportunity to challenge these assumptions directly with the force of the Gospel and the substance of justice. It is essential that the Catholic community in the United States, both as followers of Jesus Christ and as citizens who love our country, bring this message of inclusion with all of its power to bear upon the questions of poverty, exclusion and inequality.

Robert W. McElroy

Most Rev. Robert W. McElroy is auxiliary bishop of San Francisco.

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E.Patrick Mosman
10 years 1 month ago
First the Pope should study up on the billions of dollars that have been poured into developing nations already that ended up in the Swiss banks accounts of the rulers, mostly dictators , their families and intimate supporters. The poor in these countries are still poor. Next Pope Francis should study William Bradford's writing on the First Plymouth colony's failed efforts at establishing a socialist economic system, a summary can be found at; http://www.powerlineblog.com/archives/2012/11/americas-first-socialist-republic.php Pope Francis lived under both dictatorial and socialist regimes in Argentina but unlike Pope John Paul II who lived under communism, Pope Francis failed to understand the economic failures in both were caused by the governments' policies not by capitalism.China's emergence as an economic power was the result of introducing capitalism into its economic policies which created millions of jobs in a relative short time. So what type of economic system was Pope Francis condemning as a greedy "killer' citing as the cause of poverty and violent unrest in many states and what economic system was he advocating for world governments to institute to increase employment and end poverty?
William Atkinson
10 years 1 month ago
Pat: If I had 65 Billion, gave a few million away each year, but held onto my billions, invested so that in 3 years I was worth 85 billion. Just think of the industries and nuance discoveries I could do with that kinds of financial wealth, more than 90% of the world countries. It would give jobs to over 400,000,000 peoples, resolve over thousands of worlds problems, and make a major contribution to the worlds societies. Over 4 thousand peoples in America and huge numbers more around the world have this kind of stored up wealth, CEO's, board directors and executives of major corporations, hospitals, education institutes, religions all have monies way above what is needed to live and maintain a comfortable life style, they could invest in people, industries, and activities that would surge mankind into the future, instead they (sometimes unwilling) with greed in their hearts and lives keep their wealth to themselves. When the day comes they will line their caskets with this wealth as they are put to the incinerator of earth. Pat: just take a look at what is called corporate welfare. Everyone, especially politicians, complain about the Takers, but don't mention the billions given to corporations, American poor receive a few billions, but corporations, CEO's and Executives receive Trillions in corporate welfare, all of it is taxpayers moneys. And if you believe in the trickle down myth, then you also believe in Jack and The beanstock. Also take a reality check on the taxes paid by the rich, powerful and corporations. Recall before 1910, individuals didn't pay income tax, how did America survive for 150 years without income tax. Amazing - the story is the downfall of the people over the next 100 years and the rise of corporate wealth, Congress is now a puppet of the corporations, not of the people, by the people, and of the people. People elected to congress at say early 30's age are still in congress during their 90's.
E.Patrick Mosman
10 years 1 month ago
Mr Atkinson, Exactly what are you proposing? That governments should confiscate all wealth over a certain amount and have all of its citizens on a government dole while a dysfunctional government attempts to operate and control all businesses. Would we have Apple, Microsoft, the WWW or any successful company started by individuals or a stable full of Solyndras? Would we have great museums, libraries, concert halls and many other greats if there had not been the wealth of Morgan, Carnegie, Rockefeller and other wealthy families? Charles Kettering inventor American engineer whose 140 patents included the electric starter, car lighting and ignition systems said; "The opportunities of man are limited only by his imagination. But so few have imagination that there are ten thousand fiddlers to one composer." Putting the ten thousands fiddlers in charge hardly guarantees success in any endeavor.
ed gleason
10 years ago
The defenders of financial inequality forget what every HS student knows. Henry Ford [no socialist he] paid over the prevailing wage 5 bucks a day 'so the workers could buy a Ford car' The defenders of in equality so love the rich who pay to have their names etched in stone on buildings... A $15 minimum wage would even make the stone cutters happy and bring prosperity across the country. We in San Francisco [including Bishop McElroy] see how better wages brings a healthy prosperity. [come on out!] Go Giants!! Name calling 'socialist' died with the over drinking Catholic, Joe McCarthy... some posters must have missed the memo..
Joseph J Dunn
10 years ago
Ed, I do not doubt that that many high school students are taught that Henry Ford introduced the $5 Day so that his workers could buy the cars, and thus expand the market. But history says otherwise. Actually, Henry Ford introduced the $5 Day to solve a turnover problem. As he introduced the assembly line during 1913, skilled craftsmen who had taken pride in assembling thirty or forty pieces into one magneto, etc., hated the tedious, repetitive, simple assembly line process, and quit in large numbers to go to more traditional plants. By December, turnover at Ford Motor Company had soared to 380 percent. Hiring and training fifty-three thousand new people every year to maintain a staff of fourteen thousand workers would be unsustainable. What enabled Henry to raise wages was the productivity increase. Using the assembly line, he could now assemble ten times as many vehicles with the same number of workers. He used the new efficiency to pay higher wages, drop prices, and expand production. But getting employees to buy Ford cars was not part of the plan. In fact, Henry established a Sociology Department of social workers who visited employee homes to make sure they were using their higher wages for good purpose, taking care of their families, maintaining their houses, even buying life insurance, and a worker who squandered his wages could lose the bonus and fall back to the base wage of $2.34/day. The idea of "letting workers earn enough to buy a car" was a public relations spin that didn't occur to Henry until he ran for the U.S. Senate years later. Sorry to disappoint, but there was no altruism in the $5 Day, just business.
ed gleason
10 years ago
Joseph; maybe you have a good line into Henry's thinking. but forget your altruism idea ..we and the bishop are looking for justice and economic stimulation. . ... I'm referring to the economic policy of better wages being spent by the middle and working classes and so having the huge impact on the general economy. The one percent in the Hamptons buy one refrigerator or may two but it's the working middle class who buy the bulk of new things that drive the US economy. . I see the one percent buying classic cars and having them re-built....... nice but not the economy I like. p.s I'm no fan of anti-union Henry Ford. much like the many who did not elect him senator.
Joseph J Dunn
10 years ago
Thanks. I understand your economic justice position. I just wanted to address the history point. Much of Ford's business story does get mangled in the history books. Peace, Joe
Gary Rademacher
10 years 1 month ago
I understand and agree the problem of so many poor being massively disenfranchised is great. And, it seems every move to address the “inequality” issue results in disaster. In the name of acquiring equality, eight major attempts were made to establish socialist states in the 20th Century. Collectively, those eight attempts yielded more than 150 million innocents executed, starved or worked to death, and at least two billion enslaved and forced to act against their own consciences. That slaughter amounts to the greatest killing spree in all of history. Nothing else approaches it in sheer barbarism. Yet Marx's disciples promoted the killing for the good of the cause. Seems to me we lack God in many calculations, which inevitably lead to misery and death. Are we not back to the Church’s first mission – leading the world’s billions to belief in the Lord and and obedience to His commands? That commission also requires loving, feeding and clothing the poor voluntarily -- not by government mandate. I fear religious authorities lose sight of God’s commands. If so, they easily fall into even worse sin – governmentally forcing indiscriminate care for the unfortunate with other people’s money. Thereby they encourage theft, dishonesty, power seeking and dictatorship in the whole society. That is precisely what occurred in those eight socialist states in the 20th century. Those abominations lead me to to recall Pope John Paul II in Latin America addressing a priest who was kneeling in a street gutter before him. Our pope was exhorting that priest to "regularize" his relation with the Church. Liberation Theology, a devilish interpretation of the Marxist "religion," planted that creed to preach material gain for all, while undermining the faith of millions, including the priest. God does not intend for priests to pick up guns and kill just as, I believe, does he intend governments to take from hard-working citizens by force. Priests' primary mission is still to save souls. Doesn't that command still extend to the total church?
Alexander Lim
10 years 1 month ago
I have no doubts that Pope Francis means well; however, his socialistic views don't sit well with many - including many conservative Catholics. Being brought up by Dominicans, I naturally have a bad taste in my mouth for Jesuits and their well-known liberalism. Being a Jesuit, Francis fits the bill. Furthermore, from his upbringing in Argentina, what else would anyone expect. He champions the poor, however, he has a very erroneous way of going about it. The means do not justify the end - no matter how noble it may be. Say what you will about the "evil" of Capitalism, but without money, nothing can be accomplished. It is unfortunately, a necessary "evil". How can we "tithe" without money? Americans are known to be charitable - sometimes, to a fault. We know how to give back - without being told how, when and to whom. Pope Francis is not a simpleton. On the contrary, he's very well educated, but so are many Liberals. He's simply wet behind his ears and on a mission without clarity of mind. As Putin just recently commented about the failure of Socialism. He stated that no socialist regime has ever succeeded (addressing Obama's administration) and that Obama is either an idiot or that he is intentionally trying to destroy the country. Norway, as one of the Liberal/Socialist Scandinavian country, provides everything for her citizens, and is now on the brink of bankruptcy. Sooner or later, even the richest of the rich "bankrolling" the poor will soon run out of money too. Francis' message of "equality" means that we'll all end up equally poor and become wards of the state.
Robert Riley
10 years ago
The worship of wealth as an extension of one's ego - found in the structure of our capitalistic system - will ultimately destroy our social fabric and our ecological health. Capitalism CAN function justly, but not while, as at present, the "bottom line" remains income to the shareholders instead of social well being and the preservation of our natural environment. As the carpenter of Nazareth said, we think, "What does it profit a person to own the whole earth if he loses [touch with] his soul"? The soul within us is where we deeply sense our connection with all life and the Creation - and the worship of wealth takes one's focus off our deep connection to one another.
Carl Heltzel
10 years 1 month ago
Please tell me the country, present or historical, that has made a greater contribution to reducing inequality of all kinds both within and outside their own borders.
Robert Riley
10 years ago
From the beginning of our republic (now rapidly becoming an oligarchy), there has been a struggle between 1) greed/wealth and extreme individualism and 2) the sense of justice and fairness which also includes a decent wage for working people of all stripes. Right now, we have been regressing (ever since around 1978) to the massive injustice and inequity found in the gilded age (1890-1900) and the 1920's just before the great depression. The worship of the neoliberal "free market" is basically a lie, since corporations seek monopolies (often largely through government subsidies) and not a truly free competitive marketplace.
Gene Van Son
10 years ago
The “structural economic reforms” that Pope Francis and Bishop McElroy speak of that are needed to “remedy existing obstacles to greater employment” are the stumbling block because there is absolutely no agreement whatsoever on what these reforms should be. Here in the U.S. liberals/progressives favor higher taxes, more government control, and more government spending, while conservatives would like lower taxes, a smaller government, and less government spending. Economists also cannot agree on what ‘fixes’ may be needed. Top this off with the fact that different governments throughout the world each put their own spin on economics and how capitalism is practiced, and it’s pretty evident that reforms are likely to be pretty slow in coming. Still you have the give Pope Francis and Bishop McElroy credit for trying. The Church’s message is unchanged – economic markets exist to serve mankind, mankind does not exist to serve the markets. Neither Pope Francis, Bishop McElroy, Benedict XVI, St. John Paul II, Leo XIII, nor Pius XI, have offered specific fixes, only advice and guidance aimed at helping man achieve salvation. It’s up to society to figure out what fixes are needed, but given the mess that society is in thanks to the rise of relativism, individualism, and secularism, society is shooting itself in the foot, so to speak.
Michael Barberi
10 years ago
Clearly there are examples of inequality and injustice in the U.S. economic system and, to a certain extent perhaps inadvertently, in its regulations and laws. However, to paint the entire U.S. economic system and form of government with such a wide brush is disingenuous and irresponsible. Perhaps there are some trends that need to be responsibly reformed. However, the U.S. is not an malevolent society, nor is its system of governance, nor is capitalism. This does not mean that the U.S. system, et al, cannot and should not be improved. The terms of relativism, individualism, secularism and liberalism when they are practiced in their extreme can lead to injustice, inequality and evil. Keep in mind that liberalism and secularism during the time of Pope Leo XIII, was something completely different than the terms are understood today. Liberalism and secularism in the late 1800s were associated with Darwinism, the loss of the civil and secular rule of the Church when the Church lost the Papal States, and the French Revolution that significantly eroded the rule of monarchs and instituted a form of democracy by the people and for the people. These events caused the Church to view liberalism and secularism as an attempt to drive God from the lives of people and society in general. Today, liberalism is associated with an extreme, anything-goes-attitude based on situation ethics and individual autonomy without any faith and adherence to moral guidelines based of the Judeo-Christian religion. However, while some Catholics are liberal is not the same thing as saying that the majority of faithful Catholics practice an extreme form of liberalism. The Catholic Church has a role to play in promoting the faith and educating Catholics with a convincing theories in support of its moral and social teachings. To blame secularism, liberalism, individualism and relativism for the profound non-reception of many of its moral (and some social) teachings, is not realistic. We all have a role to play in setting the right example. However, to criticize the presence of injustice and inequality in the U.S. society while not putting forth a realistic solution that is workable, especially when such solutions do not address the many complex issues associated with reform, is to trumpet the clarion call that cannot be heard. Reform may be slow to take hold, and Catholics should vote with their faith and moral and social consciences, and not a particular party line or some form of extreme secularism or liberalism, regardless of the reasons.
John Fitzgerald
10 years ago
There is so much to be said in response to this piece but it's not worth it. It has to be admitted that there is a strong contradiction between Jesus' words about the poor and the rich on the one hand and significant economic inequality. The Church's speaking to this is appropriate and not surprising. That being said, the Church makes a number of mistakes. First, it seems to see the problem of inequality as specially linked to capitalism. This is absurd both historically and presently across the world. Most of the world does not operate under a capitalist system (although heavily influenced by capitalist systems) and they are marked by gross inequality. Second, the Church seems to equate the abuses that occur in the system with the norm. This is reflected in the bishop's first cultural assumption. Again, this is absurd. The economic systems of all developed countries involve a high degree of regulation and social welfare. Strict libertarians are a clear minority. Third, the Church seems not to recognize or credit the modern regulated capitalist economies for the incredible wealth producing and distributing systems that they have been. For the last 20 years I have worked some in China, India, Egypt, South Africa, Brazil, Mexico, Argentina, and elsewhere. I have seen the economic progress as well as the growth of accompanying social and environmental problems. Many of these problems are significantly linked to population growth that the Church ignores. The Pope comes from Argentina. For most of the last 100 years, Argentina has been an oligarchic, sometimes fascist system. In the last few decades it has tried various free market strategies but overall its system is still far from those n the US, Canada, and most of Western Europe. I am not wedded to the modern capitalist system. Like all economic systems before it, it will morph into something else along with other social changes. The problem with the Church's critique, however, is that it is analytically flawed.
JR Cosgrove
10 years ago
The pope and the bishop are incorrect on many counts.First, inequality in the world is the lowest it has been in the history of mankind in terms of material goods and medical services. Each year it is getting better as the free market system has produced wonders in most of the world. Here in the United States the poorest of our people live better materially and health wise than all but a few of 100 years ago. The poorest get substantial support in our system in terms of material goods. That does not mean that all are more productive than past generations but that they have access to material things and health care that was not available to past generations. Innovation has produced an incredible number of goods and services that were not even dreamed of a couple generations ago but which are considered basic rights today. That said, there is a disparity in material goods/services as well as a large difference in culture and moral behavior between the lowest and the highest that didn't exist 60 years ago. This does not mean that the lower quintiles have less than previous generation only that the upper 30-40% has an incredible array of things available to them that was not available in the past. And it will probably get wider but not because of any conscious plan or policy by anyone to make it so. Three relentless trends are driving this inequality. Two are described in Charles Murray's book, Coming Apart which I suggest that every writer for this magazine read so they understand what is driving this disparity in the United States as well as in many other countries in the world. Otherwise one gets a false impression of the underlying forces operating in our society and many other First World countries. This false impression will lead one to recommend things that have no relevance for the real underlying problems. The first thing that Murray has identified may be a genetic thing. The educated, smart and rich are marrying the educated, smart and rich. They meet in the best colleges and universities or the best jobs and get married and have children that are financially better off and then continue the process over again as the children go to the best universities and meet people like themselves. This phenomenon started in the late 50's and early 60's and is well entrenched today. Of course there are exceptions to this as some drop out of this pattern and others enter it. This is described in detail in Murray's book as he identifies the zip codes where these educated and financially well off live. Ever wonder why Bill and Hillary bought a house in Chappaqua. It is number 5 in the country in this zip code pecking order. The other phenomenon that is driving inequality is that about 40% of children are born out of wedlock and a large percentage of them grow up in a one parent household, mostly fatherless. This means that there are tremendous financial strains on the raising of these children and a very high likelihood that they will be dysfunctional. Such families often lack basic social and moral habits that contribute to success. Again this is described in Murray's book. This trend started in the late 60's and it has reached the point that 40% of the children today are in this situation. Again there are exceptions of those who escape this type of environment but a high percentage continue on in this life style. A third force that is operating is that for a few, one's actions can affect a much larger number of transactions than was ever possible before. For example, many small businesses literally sell to every continent. Just 30 years ago nearly every business would have been confined to the US and probably to one local area of the US. So even small businesses are global which makes some of the products and services they make and distribute available to billions of people so the skills of some individuals are having an effect world wide. For some the productivity of their skills has dramatically increased in terms of effect while for others nothing has changed. A house painter or local dry cleaning service is not much more productive than they were 50 years ago but a good web designer may have clients all over the world. A good example, a guy has a good time at the local zoo and emails all his friends with photos. This starts him thinking on how to make this more efficient and a short time later Twitter is born and is now a world wide phenomenon. There are certainly other forces operating but if one looks for a bogey man that is causing whatever inequality that exists they will most likely end up making things worse. The do gooders often have no clue as to what will help and we end up with policies and programs that have very negative unintended consequences. Some of the efforts from the do gooders who complain about inequality are directly responsible for the policies/programs that led to the entrenching of this inequality in our society. If you do not understand what is causing something how are you to correct it. What get's in the way is the blinders of politics which prevents one from seeing or even wanting to see just what is happening.Second, the only moral way to distribute goods is through free market capitalism. The term capitalism is never defined very well so when one uses it as it is used in the OP, just what is meant. Bishop McElroy does not seem to understand just what the free market means and neither does the pope. The statement
But as Catholic social teaching has made clear throughout the past half century, free markets do not constitute a first principle of economic justice
may be at the heart of their misunderstanding. Is something economically just if it hurts the poor? Any other system than the free market system for the distributing economic goods ends up hurting the poor. Bishop McElroy said the free market system has lifted millions of people world wide out of poverty. This needs to be corrected. It is billions not millions of people that have been lifted out of poverty world wide by capitalism (not all of it the free market variety). So what alternative is there to the best and only moral way to distribute goods that the pope or the Bishop have in mind? Before someone attacks capitalism they should know that there are about 15-20 different varieties of it so they had better be sure they are attacking the right one. Free market capitalism is where both parties in an exchange enter it freely and believe that the price was fair and the product or service they were seeking was as described and neither party is in anyway coerced. All this praising of free market capitalism does not mean that it is perfect. We live in an imperfect world so don't expect any process to be perfect. But because something is not perfect, does not mean there is a better way. Marx wrote thousands of pages about the evils of capitalism but could not describe what would replace it. He spent only 3-4 pages describing his utopia. Also there is nothing in the establishment of free markets that prevent any country, territory, sub-division or person from helping the less fortunate amongst us. The problem is how to do it and interfere in the free market system as little as possible. Hayek, one of the heroes of those who advocate free markets believe there must be a safety net for the unfortunate in our society. The question is just how to do this. This is what the pope and the good bishop should be exploring, not a denunciation of capitalism or espousing the bogus idea that inequality is getting worse.
E.Patrick Mosman
10 years ago
The seven practices of charity toward our neighbor, based on Christ’s prophecy of the Last Judgment (Matthew 25:35), that will determine each person’s, not presidents, politicians, nor government bureaucrats, final destiny was taught us from the Baltimore Catechism: 1. Feed the hungry 2. Give drink to the thirsty 3. Clothe the naked 4. Shelter the homeless 5. Visit the sick 6. Visit those in prison 7. Bury the dead For those who claim that Jesus was a big-government socialist provider with regard to helping those in need and reducing individuals personal responsibility to only “Love the Neighbor’ and replacing it with government programs is a misreading of His message. Jesus Christ made the point “to render to Caesar the things that are Caesar’s and to God the things that are God’s” with no guidelines as to how the Romans were to spend the tax monies. “For you will have the poor always with you” Matthew 26.11 and nowhere in the New Testament does Jesus Christ lay the responsibility for caring for the poor, the sick the hungry or thirsty, the homeless or any oppressed people on any governmental body. He did not cite King Herod, the priests of the temple, the local politicians or the Roman powers as the source of Charity. He made it an individual responsibility time after time in His sermons, in His parables and in His own acts. The Good Samaritan was not an example of “Love thy neighbor” because he stopped at the inn to make a 911 call but because he acted, providing aid, comfort and financial assistance to his neighbor. Jesus Christ’s teachings cannot be used be used to support states becoming the major or only source of charitable acts.
JR Cosgrove
10 years ago
Amen.
ROBERT STEWART
10 years ago
Pope Francis and Bishop Robert McElroy (in this 11.03.2014 commentary/analysis in America) get it right, especially in naming the evil that has been so destructive -- "sacralization." They are doing the work of prophets. Both are also providing a commentary regarding what the First Commandment is requiring of us, in addition to naming our idols, the ones that are currently getting our "incense" and twisting our understanding of how we are to advance the dignity of the human person. Instead of the human person made in the image and likeness of God being considered sacred, we have made our economic system sacred -- a real perversion. Pope Francis, in The Joy of the Gospel, named the evil correctly with this: "One cause of this situation is found in our relationship with money, since we calmly accept its dominion over ourselves and our societies. The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person! We have created new idols. The worship of the ancient golden calf (cf. Ex 32:1–35) has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose" (par. 55). Also, am overjoyed to again see U.S. bishops -- at least one of them at this time -- focusing on economic justice for all.
William Horan
10 years ago
"Grave inequalities within and among nations are automatically suspect in Catholic thinking and constitute not the legitimate natural order but a profound violation of that order." What about the inequalities in Catholic Education? A “preferential option for the poor” should be maintained in our Catholic Schools. If we find that we cannot afford to keep our schools open to the poor, the schools should be closed and the resources used for something else which can be kept open to the poor. We cannot allow our Church to become a church primarily for the middle-class and rich while throwing a bone to the poor. The priority should be given to the poor even if we have to let the middle-class and rich fend for themselves .Practically speaking, the Catholic Schools must close and the resources used for “Confraternity of Christian Doctrine” and other programs which can be kept open to the poor. Remember, the Church managed without Catholic Schools for centuries. We can get along without them today. The essential factor is to cultivate enough Faith to act in the Gospel Tradition, namely, THE POOR GET PRIORITY. The rich and middle-class are welcome too. But the poor come first.
John O'Neil
10 years ago
Thank you for your thoughtful, well-reasoned and inspired explanation of Pope Francis’ statements on income inequality and how some cultural assumptions in the US make a full appreciation of his critique and challenge difficult. Cultural norms that accept excessive levels of inequality as inevitable; the right to a free market as equivalent to the right to human freedom; or the belief a just society should be divided into “makers” and “takers” are truly impossible to reconcile with the gospel or a just society. We cannot let these continue by complicity or complacency. As a critique of these current cultural norms and the direction they take us, you are both spot on. As the focus for meaningful change, I’m afraid I still find it simplistic, confusing, and off target. I am not concerned with Pope Francis’ understanding of the marketplace, in general, in the United States, or Latin America. Nor do I feel any compulsion to defend an absolutely free market against any and all restrictions. Finally, I certainly do not applaud income inequality, let alone grotesque inequality. But it is one thing to remind us what should be obvious but need to hear nonetheless – that we all have an absolute obligation to the least among us or that large income inequality will be poison in a just society. Setting the tone and direction for strategies and solutions that will truly address our problems.is another thing entirely. Pope Francis and many if not all of his modern predecessors focus on a relative measure - inequality of wealth between the rich (or ultra-rich) and the poor - to the near exclusion of an absolute measure, the state of the poor today as compared to prior periods. In your explanation of his challenge, you devote significant space and cite statistics to describe the scope of income inequality. It indeed does not sound just for the 85 wealthiest people in the world to own more than the poorest 3.5 billion. That is a startling statistic. But here is an equally startling statistic. Between 1990 and 2010, the % of the world’s population in abject poverty was cut in half from 43% to 20% as 1 billion people climbed above the abject poverty line. More startling is that figure dropped by half again between 2010 and 2014 from 20% to 8.9%. Other measures that set a more ambitious and humane threshold than abject poverty, such as the number of people in households that can buy a car, show extraordinary growth and not just in China or India but in Peru and Morocco and the Philippines to name just a few. Putting aside the impact of millions more cars to our atmosphere, this fact and the ones that precede it show dramatic improvements in the absolute state of the least among us. A single-minded focus on income equality leads to solutions focused on re-distributing wealth vs creating more wealth. This is not exactly a new argument, for the church or civil society. Nor is this is a question of either/or; we do not have to choose between less income inequality and higher absolute standards for all, most importantly the poorest. But this is a very complex question. Over simplified statements and policies that rely on them do not help, they confuse. If Pope Francis feels that he needs to put his voice behind the inequality side of this argument to offset the prevailing culture and momentum on the other side, I can appreciate that. Perhaps the global improvement in living conditions that result from the spread of market economies may not need his help. But I am sure that the entrepreneurs around the world who continue to heed God’s call to participate in the ongoing co-creation of this world, who dream for their markets to be even more free, would appreciate more than an occasional acknowledgement squeezed between critiques of the market.
Michael Gent
10 years ago
Poverty is relative--no one needs to tell you that. Check out the latest UNDP publication: http://www.undp.org/content/undp/en/home/presscenter/pressreleases/2014/07/24/2-2-billion-people-are-poor-or-near-poor-warns-2014-human-development-report-on-vulnerability-and-resilience/ Income inequality is just as, if not more, corrosive at the top as it is at the bottom. Extreme wealth has multiple deleterious effects, including the distortion of political and economic life in places like the U.S. Is the "market" to blame. Certainly not. But an effective ideology of market fundamentalism, that sacralizes the market--and thus demonizes attempts to control aspects of market activity that would prevent its exploitation by the unscrupulous--is to blame.
John O'Neil
10 years ago
I agree that a market economy - any other civic structure for that matter - is not sacred. My concern is where the church places its emphasis. For all of its virtues as an example of a free market democracy, the US system and culture have obvious flaws, including income inequality. But placing that at the center of a global challenge to improve the lives of all people, especially the poor, is a mistake in my view. Market economies, especially developed ones like the US, should not be immune from controls. An equal if not greater emphasis though should be made on the need for developing economies to establish structures that support free market democracies and the entrepreneurs who drive them. These countries also have inequalities of income issues except that the poor there do not have even a glimmer of hope of climbing out through building businesses, creating jobs and the dignity that accompanies that process
ALICE MARX
10 years ago
John, I am replying to your commentary because it is one of the best written that I have read in this comment section. My comments do include language that I have read in other comments. I suppose that we all read into comments by Pope Francis and this article by Robert McElroy what we want to read. In my reading of these, I don't see any simplistic solutions suggested (such as redistribution of wealth which to most ears means taxation), any misrepresentation of the need for new ideas and exceptional work for creating wealth or any misstatement of statistics on the improved conditions of people who were in abject poverty in 1990. I do read an exhortation to (first) Catholics and all who proclaim Christ to accept that there is work still to be done to alleviate the difficult economic situation that many persons still find themselves. Since the free market system is the engine that drives the world economy (the communist system being shown to be a failure), the work most probably should begin in a dialogue that places the existing structures of our free markets on the table. (written by Paul Marx)
Joseph Cruz
10 years ago
God and the Economy Your understanding of the free market is relatively good, however; there are serious some flaws with the deeper issues you neglect to mention of fairness and theft. This has resulted in a rise of wars and forced utopianism which has led to a progressive liberal movement that always ends up historically very bad. Case in point, “WHO WILL Create the process of structural reform that will lead to inclusion rather than marginalization.” Who will be the reformer, God, man or how about Karl Marx or Stalin??? You and the Pope are to be commended for your spiritual efforts to unify people, but another thing you are forgetting is that many people who are poor are not harmless noble angels. Many are lazy slobs and criminals. Case in Point Charles Ing and Leonard Lake serial killers who often went into San Francisco to kidnap people to torture and kill them recreationally, they were both receiving government benefits which allowed them the free time to do the devils work. Millions of people work their butts off to earn high incomes so they do not have to live amongst the dregs of humanity thereby protecting their families. What happened to just giving, allowing American Christians to just give, Americans are by far the most generous people in the world. Acts of mercy is required when one is a Christian, how are we to do that if the government takes from us in order for them to give? The government now appears to be the benevolent one, this is how socialism turns to communism and let’s not forget that Communism requires the absence of God so that the Government can become God.
Margi Sirovatka
10 years ago
I recall attending an event a few years ago hosted by the Lumen Christi Institute in Chicago with Cardinal Marx as a panelist. Very astutely, a University of Chicago professor asked the Cardinal just "who" he thinks would be the likely and best candidate(s) to "structure" the markets. You state, rather obliquely, "society and government". Cardinal Marx responded "the United Nations". Nationally or globally, the "idea" (a term our current President likes to use) is on target. Yet how is it implemented? Aye, there's the rub. Corruption, bribery aside.
Mary Dahl
10 years ago
The Most Rev. Robert W. McElroy falls into the trap that most writers do in writing about the markets by failing to consider the human factor. Ludwig von Mises writes that economic events occur when “man is eager to substitute a more satisfactory state of affairs for a less satisfactory.” We want to improve our lives. Redistribution of income is a grand idea but it has been shown over and over again not to work. The dignity of work is a lofty idea, but ask anyone why they work and dignity won’t be anywhere on the list. We work to care for ourselves and our families. Rev. McElroy writes “the problem is not being able to bring bread to the table and this takes away one’s dignity.” But when bread is already on the table, there is no incentive to go out and earn any more. He states that structural economic reforms need to be undertaken to remedy existing obstacles to greater employment. What better way to greater employment can there be but to allow entrepreneurs the freedom to create new products and services and to hire people to bring them to fruition? When a person is denied to profit from the fruit of his or her own labor, that person will stop laboring. The Luxury Tax of 1990 certainly showed that. How many boatyards closed because people quit buying boats with the concomitant loss of jobs? What is the answer? Dorothy Day believed that government handouts remove the personal responsibility of each of us to care for each other. We need to encourage that responsibility and I see it happening. Ads encourage us. “Every day, care.” “Stop domestic violence.” “No means no.” It’s a slow road but one that stands a better chance than wealth redistribution. Mary Dahl, Prescott, Arizona
JR Cosgrove
10 years ago
Hurrah, If one is really concerned about the poor, then it is incumbent on them to understand just what has 1) produced the most successful economy in the world and 2) what is holding back the other end of the economic spectrum. Neither the pope or Bishop McElroy seem to understand either. Their hearts may be in the right places but neither one seems to understand what will actually work with helping the poor. They should examine each. For world poor, what has caused the dramatic decrease in the poor in the world in the last 50 years. Here is a headline from a blog post at a Washington think tank just last week
It’s the greatest achievement in human history, and one you probably never heard about
http://www.aei.org/publication/greatest-achievement-human-history-one-probably-never-heard/#.VFeCIDpyBTI.twitter And what is this greatest achievement? It is that the world poverty rate fell by 80% from 26.8% in 1970 to 5.4% in 2006. As far as inequality, why point to the United States with suppose oppressive inequality. I would think that is what one would want, more of what has worked in the United States. I am sure Bishop McElroy want to legalize all the illegal immigrants who have flocked here because of this oppressive inequality. Why are they coming if the conditions here are so bad. Here is another article about the effects of inequality. It seems that when it exists because of freer markets it actually lowers poverty. So maybe the pope and the bishop should look at what causes certain types of inequality. Inequality Does Not Reduce Prosperity - A Compilation of the Evidence Across Countries http://www.manhattan-institute.org/html/e21_01.htm#.VF0L04vF95l This topic gets a lot of uninformed rhetoric but Mary Dahl has it right and maybe Bishop McElroy should listen to people like her.
Chuck Kotlarz
10 years ago
Father Flanagan, founder of Boys Town, always marveled at Charles Dickens’ grasp of the human situation. Two favorites were Oliver Twist and David Copperfield.
Chuck Kotlarz
10 years ago
Does anyone have specifics of how the GOP has helped the poor in the US? I see deep red states lead the country in divorce (25% higher than deep blue states) which could indeed hurt rather than help the poor. I am puzzled that median income growth has been over four times better with a Democrat in the White House. The GOP ran a successful election campaign; however, the GOP controlled congress in seven of the nine worst economic contractions since 1856. I found that Reagan named the Federal Reserve building in honor of a man named Marriner Eccles. Eccles felt a system of taxation conducive to a more equitable distribution of income was essential to preventing economic depressions. The GOP, as stewards of capitalism, perhaps has garnered an invincibility it ought not to have and a luster it has not earned.
Ernest Martinson
10 years ago
A system of taxation conducive to a more equitable distribution of income would begin with the ending of the taxation of income earned by labor and capital. This revenue, immorally but legally obtained, is now distributed as welfare. The distribution is based on the biblical premise that those who have more will be given more. Instead, the tax should be on the earth. Then the equal distribution to each of us from the revenue obtained from recovering the rent of those monopolizing our common inheritance would do much for the economy, environment, and equity.

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