Caritas in Veritate, the bane of Austrianism

I've been beleaguered with requests for my take on the new Encyclical, and I believe part of this is due to the flaws of the encyclical itself. People are confused and unsure what to think of it. If it were a great encyclical, few would be asking a lay theologian for his opinion but instead would be praising it and looking forward to my praise as well. The lack of interior unity in the encyclical has allowed socialists to praise it, the libertarian-Austrian outlook to praise it, and various other groups to praise it. I'll deal with the specific difficulties of the encyclical in a part II, since this whole post is already perhaps too long.

Nevertheless, it has been interesting to note very shallow and narrow-minded organs such as the Acton Institute attempt to spin this encyclical toward Austrian economics, something founded upon an atheistic market view, when even other American Free-market thinkers such as George Wiegel and Michael Novak have the honesty to tell us that the encyclical does not agree with their worldview. More on that in a moment.

However some people, usually die hard Republican voters, take this view that the Church is right on life issues, but is run by these liberals, and is politically liberal, therefore I don't have to listen to them since the Pope is only infallible on faith and morals. Who in the history of the Church would have held that position and applied it to a papal encyclical?

Besides that, the Pope is not infallible in faith and morals, he is infallible when speaking ex cathedra on faith and morals. If the Pope speaks on faith and morals in an allocution, or an audience (such as Theology of the Body), or in an encyclical where he does not make use of the extraordinary magisterium, then his teachings are not infallible. Documents teaching the whole Church (an encyclical or motu proprio) which are not apart of the extraordinary magisterium are authoritative though they are not infallible in themselves. As I discussed before in my sedevacantist refutations, the ordinary magisterium may be infallible if it confirms what the Church has always and everywhere believed, but it is not infallible by itself as the extrarodinary magisterium is. This which is where modern neo-conservatives such as Wiegel and Novak, and even the Acton institute, get into trouble. They treat documents which attempt to teach the world in matters economic as not authoritative merely because their personal definition of economics and social activity is different than the Popes. They argue that since economics deals with science, the Pope has no authority to speak on them. This view is heretical, since it denies the authority given to the Pope at Vatican I.

This should surprise us little since they follow Lord Acton, an English liberal who denied the definition of Papal infallibility and died a heretic outside of the Church, according to several of his contemporaries. Economics, since it is based on the choices of men with their money, is bound up with social consequences which render the actions of men immoral or moral, and the Church has authority even to speak infallibly on those matters. Economics is not 2+2=4, it is a social science such as psychology, and is bound up inherently with moral behavior. Thus the Church has authority to speak on economic matters, even infallibly. It would be one thing if the Pope was trying to redefine necessary laws of economics, such as supply and demand, but he can say it is not moral to reduce everything (including employment) to a matter of supply and demand like some kind of Darwinian economic scheme. Moreover, while it is to be admitted that no ex cathedra statement exists on social teaching starting with Rerum Novarum onward, that is not grounds to reject the teaching, as say Wiegel does. Such a position is both intellectually facile and theologically dangerous, on par with the left which rejects Humanae Vitae and Ordinatio Sacerdotalis on the same grounds (not being ex cathedra) and those who reject Vatican II out of hand as non-authoritative and binding. Ordinary magisterial teaching is an act of the teaching magisterium (which this encyclical forms a part) and as such is authoritative and requires a certain level of assent. It does not require absolute assent as an article of faith does, as in you can't question it in any way, but it does require obsequium religiosum, that is religious assent. It could also be translated as religious respect, or deference. It does not mean an absolute assent upon which your eternal salvation is based, that is what is required of Ex Cathedra teaching, the articles of faith of Popes and councils teaching from the extraordinary magisterium. With ordinary magisterial teaching that does not pertain to infallibility, one may suspend his Judgment and even his assent if the teaching is not sufficiently clear or if it appears to contradict former teaching, so long as the authority in question is still respected. In the case of a contradiction, the more recent teaching always gives way to the older teaching until the magisterium should clarify it. Thus with Humanae Vitae, the liberals are correct that the teaching is not ex cathedra, but in order to withhold one's assent there need to be proportionate grounds, namely that there is a contradiction in the tradition. No such contradiction exists, Humanae Vitae's teaching is consonant with the whole Church tradition in every way. There is not one dissension in the tradition.

By contrast liberals accept the current teaching of JPII on the death penalty which is in the catechism, even though it contradicts what the Church, and even Popes have declared historically on the right of the state to put a criminal to death for proportionate crimes against society. This shows that the left simply picks and chooses, which is modernism, truth begins in the individual. Thus, I'm thankful Wiegel and Novak have admitted what we already knew, they are both modernists, since there is no proportionate reason in the Church's tradition, that is in her magisterial teaching either among the Fathers or Popes and Councils for rejecting what the Church teaches on social issues. Wiegel's position is particularly defiant, the Pope didn't write this, it came from a committee, therefore I don't have to pay attention to it. Yet, there are many instances of documents written by others, even Rerum Novarum. Once the Pope puts his name on the document and promulgates it, it is authoritative unless by an act of the same Pope, the document is rescinded.

So where does this leave us with the encyclical? Before I move to my criticisms of it, there are positive elements which are wholly in accord with Catholic social thought over the centuries.

First of all, justice. Ubi societas, ibi ius: every society draws up its own system of justice. Charity goes beyond justice, because to love is to give, to offer what is “mine” to the other; but it never lacks justice, which prompts us to give the other what is “his”, what is due to him by reason of his being or his acting. I cannot “give” what is mine to the other, without first giving him what pertains to him in justice. If we love others with charity, then first of all we are just towards them. Not only is justice not extraneous to charity, not only is it not an alternative or parallel path to charity: justice is inseparable from charity[1], and intrinsic to it. (CV no 6)

This is an important point to preface the start of the encyclical with, because too often we fall into the trap of modernism with respect to business. We feel that business owes us because it is rich. For that matter, if one meets a person who is wealthier than him, there is not only the feeling of jealousy (why am I not "rich") but of a positive feeling that he owes you. This is where charity is not rooted in justice, but is rooted in the selfish wants of the individual, and hence not charity. Catholic social teaching can not seek to eliminate justice in order to attain a better situation for the poor. It can advocate and predicate changes to the system based on truth and charity, it can never advocate robbing the rich to give to the poor. Confiscating men's wealth unjustly and giving it to others to create some great society is an act of injustice and does nothing to help society here we don't speak of preferential option for the poor, or other things to help the poorest in their time of need, but attempts to keep the poor strung along with material goods that do nothing for their dignity, rather than creating opportunities for them to work and not depend on the state.

Another important consideration is the common good. To love someone is to desire that person's good and to take effective steps to secure it. Besides the good of the individual, there is a good that is linked to living in society: the common good. It is the good of “all of us”, made up of individuals, families and intermediate groups who together constitute society[4]. It is a good that is sought not for its own sake, but for the people who belong to the social community and who can only really and effectively pursue their good within it. To desire the common good and strive towards it is a requirement of justice and charity. To take a stand for the common good is on the one hand to be solicitous for, and on the other hand to avail oneself of, that complex of institutions that give structure to the life of society, juridically, civilly, politically and culturally, making it the pólis, or “city”. The more we strive to secure a common good corresponding to the real needs of our neighbours, the more effectively we love them. This is the institutional path — we might also call it the political path — of charity, no less excellent and effective than the kind of charity which encounters the neighbour directly, outside the institutional mediation of the pólis. (CV no 7 emphasis in the original)

It is good and useful that the Holy Father argues that we need to strive for the "real needs" of the other, and not perceived needs. This is not Celine Dion defending looters by saying "let them touch those things!" Justice and charity require us to create justice in society. We can not say "that's the market!" when the market creates injustices. Because the truth is the market does not create anything, that is a bonehead idea which we need to be cured of. Men make the marked do things through their decisions, and when they act unjustly something must be done about it. Moreover, Benedict with this last statement is contending that it is the polis, the state, as well as the individual who must seek to remedy social evils. The government is not this benign clockmaker akin to deist thought which must never be involved beyond a basic thing like creating security. Government itself is required to provide for the common good of its citizens, and one of those ways is by ensuring justice in the marketplace, as we shall see.

Man's earthly activity, when inspired and sustained by charity, contributes to the building of the universal city of God, which is the goal of the history of the human family. In an increasingly globalized society, the common good and the effort to obtain it cannot fail to assume the dimensions of the whole human family, that is to say, the community of peoples and nations[5], in such a way as to shape the earthly city in unity and peace, rendering it to some degree an anticipation and a prefiguration of the undivided city of God. (ibid)

This is also important in as much as the Pope is now taking reference to the family and society's obligation to provide for the common good of the family, and extending it to the global family, that is he is arguing that society is responsible for the effects of it's actions on other continents and to other people's. We'll see how this pans out later in the encyclical.

The Encyclical Humanae Vitae emphasizes both the unitive and the procreative meaning of sexuality, thereby locating at the foundation of society the married couple, man and woman, who accept one another mutually, in distinction and in complementarity: a couple, therefore, that is open to life[27]. This is not a question of purely individual morality: Humanae Vitae indicates the strong links between life ethics and social ethics, ushering in a new area of magisterial teaching that has gradually been articulated in a series of documents, most recently John Paul II's Encyclical Evangelium Vitae[28]. The Church forcefully maintains this link between life ethics and social ethics, fully aware that “a society lacks solid foundations when, on the one hand, it asserts values such as the dignity of the person, justice and peace, but then, on the other hand, radically acts to the contrary by allowing or tolerating a variety of ways in which human life is devalued and violated, especially where it is weak or marginalized.”[29] (no 15)

Here the Pope, while pointing us back to some of the more positive ends of Paul VI's pontificate, speaks of his document Populorum Progressio and Humanae Vitae, to highlight that social issues are bound up with life issues. There is a lot of truth to this and it is a serious problem for Austrian economists who deny that there is such a link or that the Church should make such a distinction. G.K. Chesterton in his essay Three foes of the Family, argues:

"It cannot be too often repeated that what destroyed the Family in the modern world was Capitalism. No doubt it might have been Communism, if Communism had ever had a chance, outside that semi-Mongolian wilderness where it actually flourishes. But so far as we are concerned, what has broken up households and encouraged divorces, and treated the old domestic virtues with more and more open contempt, is the epoch and power of Capitalism. It is Capitalism that has forced a moral feud and a commercial competition between the sexes; that has destroyed the influence of the parent in favor of the influence of the employer; that has driven men from their homes to look for jobs; that has forced them to live near their factories or their firms instead of near their families; and, above all, that has encouraged for commercial reasons, a parade of publicity and garish novelty, which is in its nature the death of all that was called dignity and modesty by our mothers and fathers. It is not the Bolshevist but the Boss, the publicity man, the salesman and the commercial advertiser who have, like a rush and riot of barbarians, thrown down and trampled under foot the ancient Roman statue of Verecundia."

In destroying the family, by bringing the wife and kids to work (at that time, now its daycare for the kids) and eliminating common life, the social evils of today are made possible. When the family breaks down, the traditional means of educating children to carry on society becomes flawed. It is misdirected and half learned. Support is not there when children run into problems. Why else do we have teen pregnancy, abortion, divorce, families who do not want to take care of the elderly abandoning them to homes, or euthanizing (murdering) them? We have it because the family, the social unit of society has broken down. Thus the Pope notes this very thing when linking the ills of society with life issues.

In Populorum Progressio, Paul VI taught that progress, in its origin and essence, is first and foremost a vocation: “in the design of God, every man is called upon to develop and fulfil himself, for every life is a vocation.”[34] This is what gives legitimacy to the Church's involvement in the whole question of development. If development were concerned with merely technical aspects of human life, and not with the meaning of man's pilgrimage through history in company with his fellow human beings, nor with identifying the goal of that journey, then the Church would not be entitled to speak on it. Paul VI, like Leo XIII before him in Rerum Novarum[35], knew that he was carrying out a duty proper to his office by shedding the light of the Gospel on the social questions of his time[36]. (CV no 16)

Again the Holy Father takes a swipe at the Austrian outlook. Progress, the improvement of technology, changes to business and society, need to be rooted not in the immediate end, but in the eternal end. Namely, we need to get to heaven, not make money and if our business actions have an ill effect on society, if progress leads us not to creating better lives for people trying to get to heaven but rather to make their lives more difficult, or take no account of their legitimate needs, one's business actions are no longer just. Benedict likewise calls the Church's social teaching a "duty of office". Every Pope since Leo XIII has considered it their duty to speak on social issues, and arguably bl. Pius IX as well although the dynamic was different in that time.

Besides requiring freedom, integral human development as a vocation also demands respect for its truth. The vocation to progress drives us to “do more, know more and have more in order to be more”[41]. But herein lies the problem: what does it mean “to be more”? Paul VI answers the question by indicating the essential quality of “authentic” development: it must be “integral, that is, it has to promote the good of every man and of the whole man”[42]. Amid the various competing anthropological visions put forward in today's society, even more so than in Paul VI's time, the Christian vision has the particular characteristic of asserting and justifying the unconditional value of the human person and the meaning of his growth. The Christian vocation to development helps to promote the advancement of all men and of the whole man. (CV no 18, emphasis in original)

In other words the Church's vision of economic development can not be limited to a bottom line, it has to be oriented to the ultimate end of man, and justice owed to God or else it is completely invalid and a waste of time. It is not sufficient for more wealth to be produced in society, or for everyone to have the latest technological toy if man is not advancing to his ultimate goal, if justice is lacking in society.

These are all insights from Paul VIs encyclical Populorum Progressio which he is bringing back to our consideration. In chapter 2, the Pope moves to the current state of affairs in the world.

Paul VI had an articulated vision of development. He understood the term to indicate the goal of rescuing peoples, first and foremost, from hunger, deprivation, endemic diseases and illiteracy. From the economic point of view, this meant their active participation, on equal terms, in the international economic process; from the social point of view, it meant their evolution into educated societies marked by solidarity; from the political point of view, it meant the consolidation of democratic regimes capable of ensuring freedom and peace. (CV no. 21)

Although I have no love for democracy either as an ideal or a political system, it is worth noting that flawed political systems can work. In the Church's language since the council, there are often useless references to "democracy" as an end in itself, especially under JPII. What is useful in this reference, is the Holy Father qualifies democracy with "capable of ensuring freedom and peace". Thus not democracy just for the sake of it, but democracy based on the same principles of limited government as medieval monarchy, for those principles are the only thing which can give freedom and peace. Bloated oligarchies masquerading as democracy (such as ours or most of Europe) only lead to injustice, and consequently war.

We recognize, therefore, that the Church had good reason to be concerned about the capacity of a purely technological society to set realistic goals and to make good use of the instruments at its disposal. Profit is useful if it serves as a means towards an end that provides a sense both of how to produce it and how to make good use of it. Once profit becomes the exclusive goal, [free market economics] if it is produced by improper means and without the common good as its ultimate end, it risks destroying wealth and creating poverty. (Ibid)

Again, what can someone from Acton or Von Mises say in response to that, except to reject the encyclical as Wiegel and Novak have? The main idea of Austrian economics is that the profit motive in and of itself moves the most able men in society to produce and improve society, and if in the process self sufficient people get replaced by wage earners or poor dependent upon the state for survival, this is not an economic problem because it produced success in the one individual.

It is true that growth has taken place, and it continues to be a positive factor that has lifted billions of people out of misery — recently it has given many countries the possibility of becoming effective players in international politics. Yet it must be acknowledged that this same economic growth has been and continues to be weighed down by malfunctions and dramatic problems, highlighted even further by the current crisis. This presents us with choices that cannot be postponed concerning nothing less than the destiny of man, who, moreover, cannot prescind from his nature. The technical forces in play, the global interrelations, the damaging effects on the real economy of badly managed and largely speculative financial dealing, large-scale migration of peoples, often provoked by some particular circumstance and then given insufficient attention, the unregulated exploitation of the earth's resources: all this leads us today to reflect on the measures that would be necessary to provide a solution to problems that are not only new in comparison to those addressed by Pope Paul VI, but also, and above all, of decisive impact upon the present and future good of humanity. (Ibid, emphasis in the original, my emphasis)

This is probably one of the most useful sections in the whole encylical, if only for the mention of
"real economy". What does the "real economy" mean? It is a term that has come into parlance in recent years to denote real wealth produced from tangible sources, fields, mines, forests and fisheries, as opposed to wealth produced ex nihilo through financial dealing, such as banking and dividends, stock portfolios here today and vanishing tomorrow, which has come to be termed the "financial economy."

Thus the problem is not that there is too much regulation, as the free marketeers would have it, but the wrong regulation to direct the progress of society in accord with the common good, and while wealth is growing, it is not widely distributed, that is, we do not find well divided property or access to new technologies which are being developed, they are rather restricted to the wealthy classes, as we see in the rest of this paragraph and in nos. 23-24.

Today, as we take to heart the lessons of the current economic crisis, which sees the State's public authorities directly involved in correcting errors and malfunctions, it seems more realistic to re-evaluate their role and their powers, which need to be prudently reviewed and remodelled so as to enable them, perhaps through new forms of engagement, to address the challenges of today's world. Once the role of public authorities has been more clearly defined, one could foresee an increase in the new forms of political participation, nationally and internationally, that have come about through the activity of organizations operating in civil society; in this way it is to be hoped that the citizens' interest and participation in the res publica will become more deeply rooted. (CV no 24)

Here again the Pope is saying we need correct regulation to guide the conducting of economic affairs, not according to a semi-socialist vision where the government takes over companies. What needs to be done

In the context of this discussion, it is helpful to observe that business enterprise involves a wide range of values, becoming wider all the time. The continuing hegemony of the binary model of market-plus-State has accustomed us to think only in terms of the private business leader of a capitalistic bent on the one hand, and the State director on the other. In reality, business has to be understood in an articulated way. There are a number of reasons, of a meta-economic kind, for saying this. Business activity has a human significance, prior to its professional one[98]. It is present in all work, understood as a personal action, an “actus personae”[99], which is why every worker should have the chance to make his contribution knowing that in some way “he is working ‘for himself'”[100]. (CV no. 41)

This is yet another call for the meaning and dignity of work, and for us to escape the Scylla and Charybdis of Capitalism and Socialism. The Holy Father is calling us to transcend both systems and bring business back to human activity concerned with human beings not the bottom line of the capitalist or the quotas of a state political officer. Is the Pope calling for Distributism? In a way we could say that, however, without making special mention of the term or its adherents (particularly Chesterton and Belloc, both of whose families received telegrams from Pius XI and XII, I'm sure the Pope knows who they are) it would be rather shallow to claim this line of thinking for us exclusively as the Acton Institute or other libertarian think tanks have, particularly as there are things in this encyclical which should make a Distributist nervous, such as the an apparent violation of the principle of subsidiarity, but we will deal with that in the next post.

However it would be correct to say that Distributism proposes to conform economy to Catholic social teaching, and right here the Holy Father is speaking of moving the game away from principles of economy which address the system only, or utopian ideologies that put the state in charge of the family. He is talking about how to make the family, and the human being doing the work in particular, important in the economic process, since currently he is just a mere variable in an equation. Because for the Pope the individual precedes business, his needs and his dignity precede it and transcend it, business is part of the journey of man to his final end (heaven in case any capitalist is now thinking of the boon to the mortuary business) and needs to be considered within the integral nature of the person. The Pope is also saying, what we have now ain't working, and he isn't speaking of the economic crisis, but of the model in which it came into being. He brings this out more in the rest of the article:

It is in response to the needs and the dignity of the worker, as well as the needs of society, that there exist various types of business enterprise, over and above the simple distinction between “private” and “public”. Each of them requires and expresses a specific business capacity. In order to construct an economy that will soon be in a position to serve the national and global common good, it is appropriate to take account of this broader significance of business activity. It favours cross-fertilization between different types of business activity, with shifting of competences from the “non-profit” world to the “profit” world and vice versa, from the public world to that of civil society, from advanced economies to developing countries. (ibid)

In other words, business has a vocation to serve the common good not merely its profit margin, and in an increasingly globalized society it is not merely the common good of a given nation which must be considered, but of the maximum number of people on the earth affected by our business and financial decisions. If we are going to consider the common good of the globalized society, it in fact means the common good of everyone. Thus economic responsibility is not to shareholders alone, or owners alone, but to everyone affected by the businesses' decisions.

Now that of course leads to the most troubling and difficult part of the encyclical, to which we will draw this reading to a close. What consequences are there for realizing the need to conform business to a global common good?

In the face of the unrelenting growth of global interdependence, there is a strongly felt need, even in the midst of a global recession, for a reform of the United Nations Organization, and likewise of economic institutions and international finance, so that the concept of the family of nations can acquire real teeth. One also senses the urgent need to find innovative ways of implementing the principle of the responsibility to protect[146] and of giving poorer nations an effective voice in shared decision-making. This seems necessary in order to arrive at a political, juridical and economic order which can increase and give direction to international cooperation for the development of all peoples in solidarity. To manage the global economy; to revive economies hit by the crisis; to avoid any deterioration of the present crisis and the greater imbalances that would result; to bring about integral and timely disarmament, food security and peace; to guarantee the protection of the environment and to regulate migration: for all this, there is urgent need of a true world political authority, as my predecessor Blessed John XXIII indicated some years ago. Such an authority would need to be regulated by law, to observe consistently the principles of subsidiarity and solidarity, to seek to establish the common good[147], and to make a commitment to securing authentic integral human development inspired by the values of charity in truth. Furthermore, such an authority would need to be universally recognized and to be vested with the effective power to ensure security for all, regard for justice, and respect for rights[148]. Obviously it would have to have the authority to ensure compliance with its decisions from all parties, and also with the coordinated measures adopted in various international forums. Without this, despite the great progress accomplished in various sectors, international law would risk being conditioned by the balance of power among the strongest nations. (CV no. 67)

First off, any libertarian reading of this document is dead with this passage, there is no way around it. Secondly, there is an interior contradiction which should give us pause. A world body governing world finance according to subsidiarity. The principle of subsidiarity is that the smallest possible unit should govern a thing, operate a thing or conduct a thing. If a group of 10 people running automated machines to produce computer chips and parts who co-own are able to produce computer parts more efficiently or as efficiently as a large factory with underpaid employees, it ought to as the smaller unit. If government can govern more efficiently as a smaller unit than a larger, bloated bureaucracy, it should. The whole history of large and expansive governments, from the first one world government of the Roman Empire to the present with large bloated oligarchies masquerading as democracies shows us that big government does only one thing, get bigger. There is no way to sufficiently regulate or limit the power of government to prevent it from pursuing its own interests, or from being beholden to the more powerful nations, because the more power nations will fund the thing. The only governments that run on the principle of subsidiarity are those which are small, and accountable to the local populace.

I think in an ideal world where nations were animated with charity for their fellow man and desired to make decisions for the common good, such an institution would follow naturally from the continued linking of society through technology. Following from such an idealistic view one would want a world court, a world political authority which could uphold international law. Such however given the militant Christophobic nature of modern governments in wealthy and powerful nations (US, UK, the EU, etc.) that anyone could seriously make this assertion let alone the Pope should give us pause. Who helped the Pope write this encyclical, and are we bound to it?

We are not bound to this proposition that we require a one world government firstly because it contains an interior contradiction which I have mentioned. It says a one world government needs to run on subsidiarity when the definition of such a thing is contrary to the principle of subsidiarity. It is little different than saying a bachelor is a married man or there are four persons in the Trinity, they are self contradictory.

Secondly, it is on faith and morals which we are required to render obsequium religiosum to the Pope when he teaches the whole Church using the ordinary magisterium. Therefore a political suggestion can not qualify as faith and morals, since it is not connected so intrinsically with the concept of the common good or any other moral teaching so that it could be said to be connected inherently with a morals teaching. The conduct of business is a question of morals, the conduct of governments is also a question of morals and requires our respect, even if we suspend our judgment over things unclear until they are made sufficiently clear. The nature of the governments, or what might ideally be the best government is not a question for morals. Nevertheless this statement raises other questions about this encyclical, which we will address in the next section.