Is the Pope in favor of “wealth redistribution”? Should we be as well?

Going a little further about papal interpretation, and given the desire for some on the left to quote the Pope on poverty as if he was the rebuttal to Adam Smith, I would once again make the following point: To the extent that the Pope is reiterating the teaching that we must be personally generous to the poor and view wealth as something that must ultimately not be hoarded but put in the service of others, then we humbly pray for the grace to put this precept into practice. ( By the way  a nice discussion of how the wealthy should relate to money so as to avoid the temptations of riches can be read here  in this passage by St. Francis DeSales.) To the extent that the Pope is advocating specific public policies (which I do not think he is…) the Pope may be badly in error.

Consider the following thought experiment: Currently there is some controversy in medicine over the proper treatment of Stage IIIA lung cancer, with some advocating surgery plus radiation and chemotherapy, and other experts suggesting that there is no role for surgery. It is obvious regarding this controversy, that the only moral issue appropriate for the Pope to comment on is the principle that physicians must do what is best for the patient. The answer as to what therapy is actually best, is a purely medical question, based on the analysis of the scientific data and it is unimaginable that anyone would think the Pope could comment on the specific role of surgery versus alternative treatments .  The Pope is not a specialist in cancer medicine (oncology) and no one would or should take him seriously if he suggested one particular therapy over another.  In terms of economic policy and the poor, the issue is analogous .

If the Pope states that corporate CEO’s and government officials need to consider the effects of their actions on the poor then he is obviously correct. Maximizing profit at all costs is not morally right, (although totally disregarding profit is not morally acceptable either as this may bankrupt the firm and harm those dependent on it.)

To the extent that the Pope is interpreted as advocating specific economic policy, such as what the minimum wage should be, or what the corporate tax rate should be, or what specific welfare policies should exist, then it is less meaningful. These are technical questions; the answer depends on the actual outcome and effect of the policies, not solely the intent of the policy.  The Pope is not an economist and therefore would have no more ability to specify the best economic policies, or the best economic system than to specify whether a stage IIIA lung cancer should be operated on or not. The teaching that must be obeyed is the principal that the effect of the policy on the weak and vulnerable such as the poor is an important factor, indeed one of the most important factors to weigh in making such economic policy choices. What the effect of the policy decision on the poor will be is not a moral question, it is an economic question answered by economic data. At times some systems will of their nature deny a fundamental moral principle ( as Communism denied the right to private property, or perhaps Ayn Rand’s Objectivism denies charity as a good) and the systems may be validly critiqued by the Pope on this basis. This is not the case regarding the free market, which As Pope John Paul II pointed out in Centesimus Annus, is in principal, morally sound, as he states: “

 “Returning now to the initial question: can it perhaps be said that, after the failure of Communism, capitalism is the victorious social system, and that capitalism should be the goal of the countries now making efforts to rebuild their economy and society? Is this the model which ought to be proposed to the countries of the Third World which are searching for the path to true economic and civil progress?

The answer is obviously complex. If by “capitalism” is meant an economic system which recognizes the fundamental and positive role of business, the market, private property and the resulting responsibility for the means of production, as well as free human creativity in the economic sector, then the answer is certainly in the affirmative, even though it would perhaps be more appropriate to speak of a “business economy”, “market economy” or simply “free economy”

It is possible that Pope Francis might have opinions relatively critical of his understanding of capitalism, and the wisdom of specific governmental actions on the economy, but these economic opinions are the opinions of Jorge Mario Bergoglio the man, not Pope Francis the Pope, in the sense that they are covered by no divine protection from error. In his comments as “Pope” I do not think his point is to argue for specific policies or even to make broad based criticisms of “capitalism” and the free market per se. He is critical of an unrestrained “capitalism” that does not weigh the impact off economic decisions on those vulnerable to economic hardship. Only the followers of Ayn Rand need be threatened by this. Certainly Catholics in the United States who favor limited government and a free market need not be. 

There have been some on the Catholic left who seem to think that the only alternatives are a kind of libertarian state completely lacking any legal regulation at any level of government, which they accuse conservative Catholics of favoring, versus a “socially just ” leftist utopia they imagine. In reality what they favor becomes the heavy handed leviathan federal government completely untethered to Constitutional limits that the political left in the United States pushes which is not particularly effective at helping the poor . 

This political dichotomy is a false dilemma that Catholics should no longer help foster.   In the United States those who favor a free market economy and a federal government constrained by the constitution can still support some kinds of regulations, ( like child labor laws, anti fraud laws, etc..). Catholics who favor such a system would find themselves very comfortable with an economic order something along the lines proposed by John Paul II above. The specific policies needed to get there are a matter for those with expertise in economics to solve.

In other countries with other kinds of problems other kinds of political-economic questions exist and they merit their own solutions. It is truly absurd to take Pope Francis’ comments and try to make them the template for some general critique of the economic ideas of Fredrick Hayek.

To those who think Catholic “social justice” means government redistribution of wealth, even if this includes Pope Francis, I would say they are simply wrong. Government redistribution of wealth will have as an end result worsening the plight of the poor. People in Africa are not poor because people in America are relatively rich, they are in fact less poor then they would otherwise be if people in America were also poor. This is not a theory but a fact supported by data.  The reason this is so was not only written about by Hayek and the Austrian economists but by St Thomas More, in his “Dialogue of Comfort against Tribulation”:

“But, cousin, men of substance must there be. For otherwise shall you have more beggars, perdy, than there are, and no man left able to relieve another. For this I think in my mind a very sure conclusion: If all the money that is in this country were tomorrow brought together out of every man’s hand and laid all upon one heap, and then divided out unto every man alike, it would be on the morrow after worse than it was the day before. For I suppose that when it were all equally thus divided among all, the best would be left little better then than almost a beggar is now. And yet he who was a beggar before, all that he shall be the richer for, that he should thereby receive, shall not make him much above a beggar still. But many a one of the rich men, if their riches stood but in movable substance, shall be safe enough from riches, haply for all their life after!

Men cannot, you know, live here in this world unless some one man provide a means of living for many others. Every man cannot have a ship of his own, nor every man be a merchant without a stock. And these things, you know, must needs be had. Nor can every man have a plough by himself. And who could live by the tailor’s craft, if no man were able to have a gown made? Who could live by masonry, or who could live a carpenter, if no man were able to build either church or house? Who would be the makers of any manner of cloth, if there lacked men of substance to set sundry sorts to work? Some man who hath not two ducats in his house would do better to lose them both and leave himself not a farthing, but utterly lose all his own, rather than that some rich man by whom he is weekly set to work should lose one half of his money. For then would he himself be likely to lack work. For surely the rich man’s substance is the wellspring of the poor man’s living.”

Basically the point is that depleting the wealthy of their wealth does not do much to elevate the poor but drives down economic activity and thus makes the poor unable to climb out of poverty. Formal measures of income inequality are poor measures of the situation of the poor, for example the top 10% of the population holds a greater percentage of the overall national wealth in the United States (where this group holds almost 30% of the total wealth) than say Pakistan or Ethiopia (where the top 10% hold 26% of the overall wealth). For more interesting economic data you can visit this.  In any case in which country would you rather be poor? Its pretty obvious that the poor are less poor in the United States than say Ethiopia, even though the wealthy hold even more of the overall wealth than in these relatively destitute places.  As author Dinesh D’Sousa has stated, many want to immigrate to a country where “poor people are fat”.

In the final analysis it is a fallacy that Pope Francis can refute any group of economists. Economics is a social science that relies on methods and evidence proper to its nature. Good economic policies then are those which help the common good and solve the problem of scarcity ( that is the fact goods are not infinite) in a way that provides as many people as possible freedom from significant want. Much of Catholic “social justice” thought assumes wealth is fixed and the secret is its just distribution. This is a fundamental factual error, as Thomas More makes clear above, wealth is not fixed, but is continually created, people are poor not because someone else has “too much” but because they lack an opportunity to create wealth themselves. While there is always a role for alms giving in individual cases, the best policy solution is not to take from X and give to Y, but rather to make sure X uses his wealth to give Y an opportunity. This is not a Catholic principle but an economic one. Real “social justice” would be focused there.

 

As for the Pope, and our attitude towards him as loyal orthodox Catholics we affirm the following:

He is the Vicar of Christ on Earth, and therefore when speaking on faith and morals he speaks with authority and when speaking with a view to settling a question for the Church definitively, he speaks infallibly. He has definitive and final jurisdiction on canon law matters in the Church. When speaking regarding technical matters of fact however he may be wrong. We should listen carefully as we might listen to a respected parent or mentor, but he may very well be wrong. He has a weighty responsibility and we owe him our prayers and given his office, our respect.

Let us ask the prayers of his predecessor St Pius X for Pope Francis as he fulfills his ministry as servant of the servants of God

St Pius X