A document on the world economy, “Toward Reforming the International Financial and Monetary Systems in the Context of Global Public Authority” issued by the Pontifical Council for Justice and Peace (PCJP) is stirring up as much controversy for what it says as for what it does not. Its main intent seems to be to further discussion on how to repair the obvious disconnect between the financial sector and the rest of the economy — a point also made, curiously, by the Wall St. Occupiers. For that reason, the timing of the document, if nothing else, almost ensures a certain notoriety, though its release was likely aimed toward the Nov. 3-4 G20 meeting in Cannes, France.

Add to this that some media reports immediately headlined the document as if it were a new and radical papal pronouncement (some called it an “encyclical”!) endorsing a “Central World Bank” — which it is not (the PCJP addresses it to the pope) — and there will no doubt be need to address some of the misinterpretations which are already causing confusion. Unfortunately, it seems to be assumed by many, both within and outside the Catholic community, that everything that comes from the Vatican is intended to be taken as the last word. In fact, the document makes no such claims and even states, “We should not be afraid to propose new ideas.” So we will accept this invitation.

First of all, why is it that there exists such a disjunction between money and the economy in our world today? Under the “too big to fail” pretext, we have witnessed hefty bail-outs of companies who have by no reasonable standards managed their investments responsibly.  What kind of message has this sent out except that the bigger you are the less the need to limit risk when government will ensure against failure at taxpayer expense? This is far from a free or ever fair market when government protects such powerful interests and thus seems to encourage financial irresponsibility. Granted, the incentive to take excessive risks was hardly dampened by social policies that encouraged the explosion of the housing market over the last two decades, at least in this country, and the artificial bubble which has now burst — from which it is yet to recover.

It has been quite long since money has been connected to any objective standard by which its value can been guaranteed by anything short of government fiat. Nor are there any adequate controls on the amount of currency that is printed.  It is understandable that fears abound regarding the ability of governments to manipulate currency so as to create unfair trade advantages. How this could somehow be obviated by a central world authority is something left by the document to be explained by others since it offers no evidence. Considering the track record of another long-standing international body, the U.N., in controlling political and military activity, it is by no means clear how following such a model to ensure economic order in the interests of the common good is a hope with a history to ground it.

Interestingly enough, the document does not discuss the issue of accumulated public debt that so many economies are laboring under and the destabilizing effects thereof on employment and world financial markets. One can only assume that the authors would expect this to become part of any balanced discussion of how to resolve the questions the document poses. Speaking of whom, our information is that the authorship of the document is not the pope — once again, it emanates from the PCJP — but Cardinal Peter K. A. Turkson and his secretary, Mario Toso, a well-known social philosopher in Italy, whose writings have raised eyebrows in the past for some surprising positions which are likely to come to the fore in view of his influence on the document.

The document certainly deserves a reading and is a good example of the importance of the Church’s role in the public debate about social policy and the moral use of wealth and political power. While it should not be taken as new doctrine — which it does not purport to be — neither should it be used as a whipping boy by those who believe the Church has nothing to say about principles to govern financial affairs. While we would have hoped for more creative and penetrating analysis of the issues — there is little new in the document — we nonetheless welcome the ensuing discussion.

10 thoughts on “Globalization

  1. maybe we should just listen to the brilliant economists at the tablet’s editorial board and simply relax government regulations. That would surely jump start the economy! What a load of hogwash you peddled in your editorial from a few weeks ago–actually suggesting as the cure for our current economic troubles, one of the problems that helped get us into this mess in the first place.

    You posit that since the UN is an imperfection institution, any body set up to regulate banking worldwide would thereby also be imperfect. The UN has had many many major achievements. Feel free to take a look here: http://www.un.org/Overview/achieve.html

    Not to mention that the UN’s existence has coincided with what’s referred to as the “long peace.” The world, though certainly still violent and imperfect, has been dramatically less violent in the past 66 years, than in the thousands of preceding years.

    What troubles me most though about your implicitly anti-regulation argument is the stance of “the UN hasn’t been perfect, thereby this world banking regulatory body wouldn’t be perfect, so we shouldn’t have one.” You’re implicitly saying, “if it’s not perfect, we should just give up!” It’s cynical and depressing.

  2. “The UN has had many many major achievements …”

    I suppose ten years of extraordinary isolation imposed by the UN on Iraq and enforced by the US and Britain, the effects of UN sanctions on the people of Iraq which has killed more people than the two atomic bombs dropped on Japan is such an “achievement”?

    In fact, Assistant Secretary-General of the United Nations, Denis Halliday, resigned in protest over the sanctions back in September 1998.

    The UN Security Council imposed the sanctions and demanded the destruction of Saddam Hussein’s chemical and biological weapons under the supervision of a UN Special Commission (UNSCOM). Iraq is permitted to sell a limited amount of oil in exchange for some food and medicine.

    There is disturbing evidence that the “holds” on humanitarian supplies have paralyzed the country and devastated millions of people, many dying from curable diseases because life saving drugs are only available intermittently.

    The breakdown of the clean water system and health facilities are having a tragic effect on young children, contributing to an alarming rise in their mortality rate.

    The suffering caused to the civilian population by the illegal bombing campaign being conducted by US and Britain in the “no-fly zones” in northern and southern Iraq.


  3. Andrew D’Emic, are you in the 1990s? Do you need someone to come back in a time machine and rescue you? Aren’t FRIENDS and SEINFELD amaaaaaazing?

    seriously though, it seems like you’re talking about UN sanctions against Iraq in the 1990s. are you?

  4. We already “won” the war in Iraq — true, the sanctions have been lifted.

    If “winning the war” in Iraq is measured by Iraqis suffering without adequate shelter, poor sanitation and lack of clean water, the fact that Iraq is once again in danger of a cholera outbreak.

    But of course, it is control over Iraq and its oil–not infrastructure and clean water–that the U.S. has fought for.

    Likewise, Libya has nothing to do with protecting anyone — only the terminally naive believe such nonsense.

    It is the logic of American foreign policy since 1945.

    Further back, the Vietnam war’s purpose was to halt the influence of China, an imperial rival, and “protect” Indonesia, which President Nixon called “the region’s richest hoard of natural resources… the greatest prize”.

    Vietnam merely got in the way; and the slaughter of more than three million Vietnamese and the devastation and poisoning of their land was the price of America achieving its goal.

    A trail of blood from Vietnam, Latin America to Afghanistan and Iraq, the rationale was usually “self defence” or “humanitarian”, words long emptied of their dictionary meaning.

    I don’t know how you or any Christian/Catholic could make light of these war crimes.

  5. Hi Andrew,
    My apologies. I didn’t mean to make light of the crimes you speak of. I largely agree with you. But I don’t think anything you’ve said backs up the contention that the UN is completely useless and hasn’t achieved anything. Also, we’re getting a bit off topic, I think.
    Best, Berrigan

  6. While the U.N. may have served United States “interests”, I wouldn’t trust the occult forces behind it.

    FDR’s son-in-law Curtis Dall’s prophetic remarks in “FDR, My Exploited Father-In-Law” which are very much on topic:

    “Adlai Stevenson’s quoted remark, ‘the U.N. soldier is like no other’ that observation is quite true.

    “He is, in fact, not a soldier at all, but a thinly disguised, Secret Policeman, acting on behalf of the Bilderberger Council on Foreign Relations (page 180)

    “The unstated objective of the U.N. Soldier however is to enable the Council on Foreign Relations sponsors of the U.N. to acquire, directly or obliquely, for their banking over lords and friends, vast new areas rich in natural resources.

    “Thereupon, they inject a new political “democratic” government; promptly to establish a new controlled monetary system, of course, and then proceed to set in motion plans to exploit and market those natural resources.

    “In effect, it is well organized plundering of numerous underprivileged nations on the grand scale, with you and me as misinformed Americans, paying for most of the cost of acquiring those new markets and profits for the top proprietors of the U.N.

  7. Good article. I misinterpreted your use of the word “occult.” It is clear that powerful countries like ours can use money to influence voting at the UN. But I still think the fact that the UN exists and countries are talking to each other is a good thing. And it doesn’t refute the fact that the UN has done much good at other points in the last 60 years. Just because it hasn’t stopped every war, doesn’t mean it hasn’t stopped or shortened many other conflicts.

    I stated in my first post that the UN is imperfect, but that doesn’t mean we should give it up altogether. If we were to follow that logic we would dismantle all human institutions.