My dear brothers and sisters in the Lord,
In collaboration with Bishop William Murphy of the Diocese of Rockville Centre, I offer his analysis and my insight into the current global economic crisis which affects us all.
Several weeks ago, the G20 group of heads of governments met in Cannes, France, to address some of the pressing economic and financial issues that have affected the lives of us all since 2008. The meeting did not provide any significant breakthroughs and was dominated by the understandable preoccupation of European leaders with the fate of Greece, and now Italy, and its effect on the Euro. A week before the G20 meeting, the Pontifical Council for Justice and Peace, the Vatican office where Bishop Murphy worked for many years, issued a 14-page “Note,” titled “Towards Reforming the International Financial and Monetary Systems in the Context of Global Public Authority.”
The Pontifical Council wished to make a contribution to the current international debate taking place at several levels. The note seeks to make a contribution to reflect on the many faceted issues in the economic and financial worlds that have left no part of the world untouched. The Council offers this out of a sense of responsibility for the good of present and future generations. It is not intended nor is it in any sense an exercise of the teaching office of the Church. Rather the “Note” seeks to analyze the current situation with its many challenges and increasing dangers and apply to these complex realities some elements of Catholic social teaching.
The analysis they offer seemed to Bishop Murphy to be accurate in its recounting of the elements that have led to the present global financial and economic crisis. While experts hold various positions, it is clear that in the 1990s money and credit increased much more rapidly than productivity and thus the return on investment became at the very least precarious. Excessive liquidity and new types of speculation created new crises of solvency and of trust. Going back to the ’70s and ’80s with the increased price in oil reveals that the developing countries had already been hard hit and were already in worse position than before. The speculative bubble in housing and the recent financial crisis became the final catalysts that led to the current situation which reached a head first in the United States, the largest single economy, and then necessarily and inevitably across the whole global financial and economic world.
The “Note” faults two major weaknesses: a liberal economy without rules and controls and a utilitarian ideology which maintains that personal and corporative profit motivation will ultimately lead to the benefit of all. If these are not addressed, then there is little hope for corrections that will guarantee the avoidance of this kind of crisis in the future.
The central point of the proposal of this “Note” is the creation of a public authority on an international or global level that would correspond to the ethic of solidarity which Pope Benedict XVI proposed in his encyclical, Caritas in Veritate. The authors point to Blessed John XXIII’s encyclical, Pacem in Terris, as a precedent for their proposal. The purpose is rather vaguely expressed as “service to the common good, endowed with adequate and effective structures that would be reflective of the high importance of its mission and the great hopes that it would engender.”
The “Note” admits that this would be a delicate and difficult task to accomplish, that it would demand many preliminary steps of consultation and collaboration and, as an expression of the will of “the community of nations,” it might best not be a permanent structure but would respect the diversity of the nations of the world on the cultural level, as well as regards their material resources and their respective conditions, historical, geographical and economic.
Finally, in light of all these factors, they envisage this public authority as acting according the principle of subsidiarity, offering a “support” (subsidium) to all political, financial, economic, private and public actors who are the stakeholders in today’s globalized economy.
I thank Bishop Murphy for his analysis of this “Note,” which was published only in Italian. It makes an important contribution to the application of Catholic Social Teaching to current social problems. Some have criticized the Council’s meddling in affairs beyond its competency calling the suggestions of a public institution with universal financial competence as utopian. Some even see the document as support for the worldwide “Occupy Wall Street” movement. The Church, however, has been called by several popes, “an expert in humanity,” not having universal expertise in every human affair, but understanding human nature down through the centuries. Capitalism seems to give the Church the necessary freedom to accomplish its mission, but the Church exists in a variety of economic systems which the Church tries to conform to the Gospel, especially in regards to the care of the poor and disadvantaged.
On this Thanksgiving weekend, we as Americans have much to be thankful for, but always we must try to improve our society. Its moral and economic aspects can always be better.
The Pontifical Council for Justice and Peace has put out into the deep in attempting to apply Catholic Social Teaching to our contemporary problems. Any wisdom in the present economic crisis is welcomed and may prove beneficial.