The Vatican Road Is Paved With Good Intentions

"Jesus was the first socialist, the first to seek a better life for mankind" – Mikhail Sergievich Gorbachev is reported to have said. He was neither the first nor the last to claim this: in 2007 Venezuelan President Hugo Chàvez said that Jesus was “the greatest socialist in history”. It is true that some passages in the Gospel are suggestive: “The first shall be last ... ”, “the meek shall inherit the earth ... ”, the Good Samaritan and “love thy neighbour”, Lazarus and the rich man, chasing off the merchants from the Temple, “You cannot serve God and money”, the camel through the eye of the needle … But these are calls for greater equality, reciprocity, social justice, to be achieved through individual honesty and generosity, not through political or collective action, let alone a revolution (contradicted by “Give onto Caesar…”).

Benedict XVI’s long-anticipated social encyclical, “Caritas in Veritate” [Love in Truth], released on Tuesday 7 July 2009 on the eve of the G8 meeting at L’Aquila, is supposed to be the Catholic Church’s enlightened response to the current challenges of globalization and the financial crisis, of widespread poverty and rising unemployment, and the growth of inequality. It has been greeted as a radical, progressive manifesto (for instance by the Governor of the Bank of Italy Mario Draghi, in “Senza etica non c’è sviluppo”, L’Osservatore Romano, 9 July 2009). Admittedly Love in Truth, compared with the G8 wishy-washy “President’s Summary”, does sound quite radical. But in truth and charity Benedict XVI’s text is a remarkably bland, vague and ineffectual treatment of the issues it is supposed to address, just like all the previous acclaimed papal encyclicals from 1891 to date. Indeed in some respects – for instance on intellectual property protection, on immigration, on its neglect of monopoly – in spite of new noises about full employment, non-profit organisations and the economics of gift, it represents a marked regress with respect to earlier statements of the Catholic Church’s “social doctrine”, especially those of John Paul II.

Leo XIII: Rerum Novarum (1891)

Leo XIII discusses the implications of an economic system based on “a new property form”, capital, and a new form of labour, “wage labour”, echoing Marx in defining labour as a commodity freely exchanged in the market, insecurely and without reference to any vital minimum, involving a society "divided into two classes, separated by a deep chasm” (n.132). The system had been developing for some time but towards the end of the XIX century was reaching a critical point: “… society …was torn by a conflict all the more harsh and inhumane because it knew no rule or regulation. It was the conflict between capital and labour, or — as the Encyclical puts it — the worker question” (as John Paul II commented in his celebratory Centesimus Annus in 1991).

Leo XIII condemned class war, but was aware that class peace could be built only on justice (n. 130); he stressed the dignity of work and of the worker. Among the rights worthy of protection, next to ownership he listed the right to associate in Trades Unions, to limit working hours, protect the working conditions of children (he did not seem to mind at all that children should actually be working instead of going to school) and women, and the right to a “fair wage”, understood as the right to the necessary means of subsistence. A fair wage is a woolly concept, like that of a fair price. “A fair price – I was taught in the 1960s by a scathing Nicky Kaldor – is that which gives a fair rate of return on labour costs reckoned at a fair wage”: the indeterminacy of two out of these three variables and their possible/likely inconsistency given the state of technology clearly did not occur to Leo XIII and his economic advisors. But apart from that Leo XIII was adamant, though he may have not understood fully how far-fetched, radical and probably impossible his proposition was : “A workman's wages should be sufficient to enable him to support himself, his wife and his children. If through necessity or fear of a worse evil the workman accepts harder conditions because an employer or contractor will afford no better, he is made the victim of force and injustice"(n.131). He did not stop to consider whether unemployment was fairer or less fair than an unfair wage, which he should have.

Leo XIII was equally critical of liberalism and socialism. "To remedy these wrongs [the unjust distribution of wealth and the poverty of the workers], the Socialists encourage the poor man's envy of the rich and strive to do away with private property, contending that individual possessions should become the common property of all...; but their contentions are so clearly powerless to end the controversy that, were they carried into effect, the working man himself would be among the first to suffer. They are moreover emphatically unjust, for they would rob the lawful possessor, distort the functions of the State, and create utter confusion in the community" (n.99). Leo XIII deserves full credit for this prophetic criticism of what came to be known as “realised socialism” (Rudolph Bahro’s expression); John Paul II paid him such credit in his Centesimus Annus.

From Pius XI to Paul VI

The “social doctrine” of the Catholic Church was further developed by Pius XI in Quadragesimo Anno (1931). Not surprisingly Pius XII left no mark whatever on such doctrine. John XXIII in Mater et Magistra (1961) and in Pacem in Terris (1963) stated unambiguously that the social question had become world-wide.

Paul VI, in Populorum Progressio (1967, which Benedict XVI rightly or wrongly considers “the Rerum Novarum of the present age”), tersely denounced “the scandal of glaring inequalities not merely in the enjoyment of possessions but even more in the exercise of power” (n.9), called for integral development, “the good of every man and of the whole man” (n.14), and stigmatized “a system … which considers profit as the key motive for economic progress, competition as the supreme law of economics, and private ownership of the means of production as an absolute right that has no limits and carries no corresponding social obligation. This unchecked liberalism leads to dictatorship rightly denounced by Pius XI as producing “the international imperialism of money””.

It is interesting to note that Paul VI recognized the possibly adverse impact of population growth on development. “It is true that too frequently an accelerated demographic increase adds its own difficulties to the problems of development: the size of the population increases more rapidly than available resources, and things are found to have reached apparently an impasse. From that moment the temptation is great to check the demographic increase by means of radical measures” – though of course he rejected such measures in the name of the freedom of married couples, the moral law, the right to procreation and the law of God.

“Rich nations must give to developing countries”. “… the superfluous [sic] wealth of rich countries should be placed at the service of poor nations” – not a radical proposal: Paul VI does not explain why only superfluous wealth should be given . “At Bombay [4 December 1964] we called for the establishment of a great World Fund, to be made up of part of the money spent on arms, to relieve the most destitute of this world”. He was aware that developing countries relying on primary products’ exports were at a disadvantage in trade with highly industrialized nations; on that ground he questioned liberalism but as a remedy he only called on the goodwill of industrialized countries. “The world is sick. Its illness consists less in the unproductive monopolization of resources by a small number of men than in the lack of brotherhood among individual and people”. “Excessive economic, social and cultural inequalities among peoples arouse tensions and conflicts, and are a danger to peace”. “We appeal to all Our sons… Changes are necessary, basic reform are indispensable: the laymen should strive resolutely to permeate them with the spirit of the Gospel”.

Looking back, it is surprising that this collection of bland and trite platitudes, without any real initiative to promote any change for the better, should ever have been regarded by anybody – believer or not – as something worthy of attention and comment. And how could John Paul II suggest that “The Encyclical [Rerum Novarum] and the related social teaching of the Church had far-reaching influence in the years bridging the nineteenth and twentieth centuries. This influence is evident in the numerous reforms which were introduced in the areas of social security, pensions, health insurance and compensation in the case of accidents, within the framework of greater respect for the rights of workers”. As if such reforms had nothing to do with Trades Union militancy, War and Post-War developments, the response to the Great Crisis, emulation of the social policies of “realized socialism”. But John Paul’s pontificate really did make a difference.

John Paul II

John Paul II made several important pronouncements on the Church’s “social doctrine”. His Centesimus Annus endorsed fully Leo XIII’s Rerum Novarum and developed it to discuss the 1989 fall of the socialist system of central-eastern Europe and its transition to capitalism; to criticize liberalism and western consumerism, to introduce environmental questions, to raise much more forcefully than ever before (in Church doctrine) issues of poverty and inequality. Two other encyclicals of his had prepared the ground: Laborem Exercens on human work (14 September 1981) and Sollicitudo Rei Socialis on the current development problems of individuals and peoples (30 December 1987).

But a much lesser known “Post-Synodal Apostolic Exhortation” Ecclesia in America, delivered in Mexico City on 22 January 1999, expounds and develops his approach to globalization. And two official documents produced during his pontificate and submitted respectively to the United Nations and the World Trade Organisation, on the excessive protection of intellectual property rights, moved the Vatican from general moral exhortations to concrete, progressive policy proposals, from an audience of the faithful to the appropriate global institutions.

Centesimus Annus (1991)

John Paul II attributed the 1989 collapse of communism in central eastern Europe to “the violation of the right of work” [presumably meaning the human rights of workers], the inefficiency of the economic system, and the spiritual vacuum provoked by atheism. He claimed that an important, decisive contribution had been ”the Church’s commitment to the defence and promotion of human rights”, and the meeting of the Church and the workers’ movement. But in a memorable piece in The Guardian (8 April 2005) Jonathan Steele convincingly argued that “It was Gorbachev, not the Pope, who brought the system down”. And that “The impetus for Gorbachev’s reforms was not external pressure from the west, dissent in eastern Europe or the Pope’s calls to respect human rights, but economic stagnation in the Soviet Union and internal discontent within the Soviet elite”.

John Paul II states that “private property also has a social function which is based on the law of the common purpose of goods". “God gave the earth to the whole human race for the sustenance of all its members, without excluding or favouring anyone. This is the foundation of the universal destination of the earth's goods.” This is a meaningless proposition, for there is no sense in which the earth’s goods have a common purpose or destination, in our world where the Gini coefficient for global income distribution is 65%, and is much higher for wealth distribution (see my earlier post on To Have and Have Not). And the idea that individual labour is the origin of individual property is fatuous, because it ignores primitive accumulation. Where John Paul takes an enlightened stance, however, is on the importance of knowledge and the excessive protection of intellectual property right (see below, on Vatican submissions to the World Intellectual Property Organisation and the WTO on the subject).

National and global markets “seem” (in John Paul’s words) to be efficient in the allocation of resources and the satisfaction of needs, but the defeat of so-called “real socialism” should not “leave capitalism as the only model of economic organisation”. “It is necessary to break down the barriers and monopolies which leave so many countries on the margins of development, and to provide all individuals and nations with the basic conditions which will enable them to share in development.” “There are collective and qualitative needs that cannot be satisfied by market mechanisms”. Consumerism is chastised in all its forms, including drugs and pornography. Enterprises should not be directed to profit only but to (unspecified) “other human and social factors”, and should be treated as “communities of men”. The service of high foreign debt should not lead entire populations to hunger and despair.

Ecclesia in America (Mexico City, 1999)

Chapter 2 of this large document, under the unlikely heading “Encountering Jesus Christ today in America”, contains a full discussion of globalization and its ethical implications. Globalization “brings some positive consequences, such as efficiency and increased production and … with the development of economic links between the different countries, can help to bring greater unity among peoples and make possible a better service to the human family. However, if globalization is ruled merely by the laws of the market applied to suit the powerful, the consequences cannot but be negative. There are, for example, the absolutizing [sic] of the economy, unemployment, the reduction and deterioration of public services, the destruction of the environment and natural resources, the growing distance between rich and poor, unfair competition which puts the poor nations in a situation of ever increasing inferiority. While acknowledging the positive values which come with globalization, the Church considers with concern the negative aspects which follow in its wake” (n.20).

Chapter 5 of Ecclesia in America, on “The path to solidarity”, develops these themes further. There is a call for “the globalization of solidarity”; a sharp criticism of “neoliberalism”; “based on a purely economic conception of man, this system considers profit and the law of the market as its only parameters, to the detriment of the dignity of and the respect due to individuals and peoples. At times this system has become the ideological justification for certain attitudes and behavior in the social and political spheres leading to the neglect of the weaker members of society. Indeed, the poor are becoming ever more numerous, victims of specific policies and structures which are often unjust” (n.56). Reduction and cancellation of foreign debt, environmental protection and reclamation, corruption, drug trade, the arms race, immigration, receive specific attention.

On immigration, “the Church in America must be a vigilant advocate, defending against any unjust restriction the natural right of individual persons to move freely within their own nation and from one nation to another. Attention must be called to the rights of migrants and their families and to respect for their human dignity, even in the case of non-legal immigration” (n. 65).

Yet John Paul opposed liberation theology – “because he saw priests defy their bishops and challenge the church’s hierarchical structure” (Jonathan Steele, cited).

The Holy See Submissions to the WIPO and the WTO (2001)

On 16 April 2001 the Permanent Observer Mission of the Holy See in Geneva submitted to the United Nations WIPO a document entitled “Intellectual property and genetic resources, traditional knowledge and folklore”. It firmly opposed the patenting of “genetic material existing in nature, provided that it is possible to replicate it using a biochemical process – a sort of reverse engineering of the complex results of natural evolution”. It defended the rights of use and usufruct of such materials by “native communities that have some knowledge and make use of some of the biological properties covered by the patent”. Present legislation tends to abandon “the social function of intellectual property”, and “patents constitute a brake on free competition”. The Holy See advocates: the informed, free agreement of persons, peoples and states involved as a prerequisite of patenting biological resources; equitable economic participation of native populations in the benefits from commercial exploitation of biological resources: the extension of such protection to human genetic resources; “assurance that patents for biological discoveries do not constitute an undue obstacle to subsequent research and scientific teaching.” Chapeau.

On 20 June 2001 His Excellency Mons. Diarmuid Martin submitted “Intellectual property and access to basic medicines” to the WTO Plenary Council on trade-related aspects of intellectual property rights, on behalf of the Holy See. “Within an open free trade system, intellectual property rights constitute an exceptional monopoly regime”. The submission calls for price discrimination on drugs in favour of poor countries, and a regime of compulsory licensing “to be used as remedies in situations of national emergency or other circumstances of extreme urgency”. “A broad-based commitment of solidarity is the best way to prevent poor countries from falling into the temptation of weakening the Intellectual Property rights framework” (italics in the original text).

Not only that, but: “The Holy See, consistent with the traditions of Catholic social thought, underlines that there is a "social mortgage" on all private property, namely, that the reason for the very existence of the institution of private property is to ensure that the basic needs of every man and woman are met and sustained. This "social mortgage" on private property must also be applied today to "intellectual property" and to "knowledge" (John Paul II, Message to the "Jubilee 2000 Debt Campaign" Group, September 23, 1999). The law of profit alone cannot be applied to that which is essential for the fight against hunger, disease and poverty. Hence, whenever there is a conflict between property rights, on the one hand, and fundamental human rights and concerns of the common good, on the other, property rights should be moderated by an appropriate authority, in order to achieve a just balance of rights.” This is a most powerful, pointed, specific and effective proposal. This kind of “social doctrine” – obviously developed by John Paul II, is a truly revolutionary change. “Santo subito”, as his followers decreed after his death.

Benedict XVI: Caritas in Veritate (2009)

Against this background of major contributions to the Church’s “social doctrine” – and in particular the pronouncements of John Paul II who can be considered its true founder – what is the value added of Benedict XVI latest encyclical?

Before getting to substantive points, the non-believer is put off by more cryptic and mysterious statements than usually are found in encyclicals: about Love in Truth and its apparently equivalent inverse, Truth in Love; the asserted but unexplained importance of the Gospel for development, as well as several references to the mystery of the Trinity. Nothing the matter with that, from a pope of course, but it does not help communications with the world at large.

The necessity of the full development of individuals and peoples is borrowed from Paul VI and John Paul II. The limitations of the profit motive are not new in the Church’s social doctrine. The narrative of the current global financial crisis is obviously broader, richer and more accurate than anything anticipated in previously encyclicals, but that is simply the benefit of hindsight and up to date information, not of particularly profound insights.

Here are a few instances of awareness of recent changes. The limits placed by globalization on the feasible policies that national governments can undertake are stressed. The “…downsizing of social security systems [is] the price to be paid for seeking greater competitive advantage in the global market, with consequent grave danger for the rights of workers, for fundamental human rights and for the solidarity associated with the traditional forms of the social State.” “Governments, for reasons of economic utility, often limit the freedom or the negotiating capacity of labour unions. Hence traditional networks of solidarity have more and more obstacles to overcome.” “…uncertainty over working conditions caused by mobility and deregulation, when it becomes endemic, tends to create new forms of psychological instability, giving rise to difficulty in forging coherent life-plans, including that of marriage”. “What is missing … is a network of economic institutions capable of guaranteeing regular access to sufficient food and water for nutritional needs”. “…the human consequences of current tendencies towards a short-term economy — sometimes very short-term — need to be carefully evaluated.” The encyclical acknowledges “the damage that can be caused to one's home country by the transfer abroad of capital purely for personal advantage”. It condemns the “speculative use of financial resources that yields to the temptation of seeking only short-term profit, without regard for the long-term sustainability of the enterprise”, though often it may be difficult for a speculative use to be distinguished from other uses. “Both the regulation of the financial sector, so as to safeguard weaker parties and discourage scandalous speculation, and experimentation with new forms of finance, designed to support development projects, are positive experiences that should be further explored and encouraged, highlighting the responsibility of the investor.”

Otherwise, the characterization of globalization, its benefits, costs and excesses, the principle of subsidiarity in its governance; the concern about poverty, inequality and environmental issues, do not add much to the picture already drawn by John Paul II in his encyclicals. Added emphasis on the need of “equivalent value” in international trade (echoing unfashionable, outdated post-Marxian trade theory based on irrelevant labour values, as Arghiri Emmanuel’s Echange Inégal, 1962, 1969) is just as empty as Leo XIII’s reliance on the “just wage”.

There are a few minor novelties in Love in Truth. One is the reliance on non-profit organizations as a form of enterprise that can operate in the market and provide social services efficiently, mobilizing additional entrepreneurial energies in society. This is a hopeful possibility, known to be a pet concern of one of Benedict XVI’s economic advisors, Stefano Zamagni, yet untried in its full potential and of doubtful viability in a deep crisis.

A stronger novelty is the advocacy of “principle of gratuitousness”, the economics of gift, for the pleasure of giving rather than for the benefit of remission of sins. Reciprocal gift is well known (since Marcel Mauss, Le Don, 1922) as the foundation of some of the social texture of any society, but it is a limited foundation whose limits are confirmed by Benedict XVI: “Gift by its nature goes beyond merit, its rule is that of superabundance” – ultimately the same thing as Paul VI advocating the gift of “superfluous” wealth.

The commitment to “prioritize the goal of access to steady employment for everyone” is another strong novelty. It might have been wiser to talk of government policies aiming at high and stable employment, rather than full employment for all, as of right. The right to employment is also enshrined in article 4 of the Italian Constitution, and equally wishfully futile. Nobody can have a right to anything without somebody else having a corresponding obligation, and short of there being an Employer of Last Resort (a possible, though remotely likely institution, missing from both the Italian Constitution and Love in Truth) the promise of a right to employment is a straight con. Not so much Stalin's enquiry when warned by an adviser against coming into conflict with the Catholic Church, “How many divisions does the pope have?”. Rather, when Benedict XVI calls for access to steady employment for everyone, the operative question is “How many trillion dollars does the pope have?”. Not enough to make a dent on world unemployment.

These well-meaning but merely wishful additions to the Church’s social doctrine come at a price. For instance, the dilution of the Church’s position on immigration previously reached by John Paul II. The contributions that migrants make to both their country of origin via remittances, and to the host country, are acknowledged, and so are their “inalienable rights that must be respected by everyone and in every circumstance”. But Benedict XVI is awed by “the sheer numbers of people involved, the social, economic, political, cultural and religious problems [immigration] raises, and the dramatic challenges it poses to nations and the international community.” The phenomenon “requires bold, forward-looking policies of international cooperation if it is to be handled effectively. Such policies should start from close collaboration between the migrants' countries of origin and their countries of destination; [such collaboration] should be accompanied by adequate international norms able to coordinate different legislative systems with a view to safeguarding the needs and rights of individual migrants and their families, and at the same time, those of the host countries. No country can be expected to address today's problems of migration by itself. We are all witnesses of the burden of suffering, the dislocation and the aspirations that accompany the flow of migrants.” Maybe this is a change in the right direction, but a far cry from John Paul II’s “natural right of individual persons to move freely within their own nation and from one nation to another… the rights of migrants and their families …even in case of non-legal immigration”.

On excessive protection of intellectual property, the powerful proposals submitted by the Holy See to the WIPO and the WTO in 2001 are totally forgotten, replaced by a feeble single sentence “On the part of rich countries there is excessive zeal for protecting knowledge through an unduly rigid assertion of the right to intellectual property, especially in the field of health care.” The likely negative impact of demographic growth on sustainable development, which had been recognized by Paul VI (see above), is denied by Benedict XVI: “To consider population increase as the primary cause of underdevelopment is mistaken, even from an economic point of view”. There is a total neglect of monopoly and its adverse impact on unemployment and distribution (neither “monopoly” nor “competition” figure in Love in Truth). Altogether, not a small price by any means for the few novelties reported above.

Finally, there is no progress with respect to the view that has always characterized Vatican thinking, that economic problems can be solved if only individuals behaved ethically, a precondition no different from the socialist reliance on the development of “socialist man”, and equally pretentious, hopeless and futile. Benedict XVI has a peculiar notion of “the common good”: “It is the good of “all of us”, made up of individuals, families and intermediate groups who together constitute society” – thus implicitly rejecting the possibility of bettering the position of some individuals families and groups at the cost of worsening that of others. Mario Draghi writes that “Without ethics there is no development” (the title of his article quoted above). Not so. What is needed is not ethics but rules, legal rules embodying those ethical principles but relying on a clear system of penalties and rewards in this life rather than the next.

Caritas begins at home

Suppose that Benedict XVI (and his predecessors who have developed the Catholic Church’s “social doctrine”) had really wanted to impact the full, sustainable development of individuals and peoples, reduce poverty, improve equality, avoid exploitation and unemployment. They have powerful instruments at their disposal, not just moral exhortations but a complex system of permissions and prohibitions, backed by powerful penalties and rewards. There are a few things popes could have done, and could still do, at a stroke. Encourage contraception, to reduce both population growth and the resulting unsustainable pressure on non reproducible resources (that Paul VI well understood, and Benedict XVI denies) and at the same time reduce the number of abortions. Encourage or at least condone the use of condoms in particular, to avoid the spread of HIV and other sexually transmitted diseases. Let people die in peace if and when they want to. Make false reporting, insider trading and tax evasion a mortal sin explicitly, and excommunicate pyramid bankers. Promulgate a schedule of hundreds, thousands, millions, trillions days of indulgence to reduce sinners’ permanence in Purgatory for each economic good deed, and grant plenary indulgence for remission of debt or the hiring of the unemployed. All these measures would affect only Roman Catholics, but there are enough believers and practicing sinners among them to make a significant difference.

As it is, the Vatican Road is paved with good intentions. It does not lead to Hell, but leads nowhere - other than the status quo.