Catholic Social Ethics and the Economy

This is a modified draft of a talk I am giving this weekend as part of an adult education program on Catholic Social Ethics and the economy.

I. Introduction

Human dignity can be realized and protected only in community.” This statement, from the 1986 US Bishops Pastoral Letter entitled Economic Justice for All, is foundational for understanding what Catholic social ethics is all about.  Generally, ethics is the systematic study of how to live well in light of the various demands of human existence.  The formulation of rules and principles, the evaluation of consequences, the weighing of responsibilities, and the cultivation of virtues are all included under the rubric of ethics.   The more specific genre of social ethics emerges from the insight that as human beings, we are inherently social creatures and that our ability to live well depends on the quality of the relationships which we maintain.

Economic issues have been a particular concern within Catholic social ethics over the last three decades.  In 1986, the US Catholic bishops promulgated a pastoral letter on Catholic social teaching and the economy entitled “Economic Justice for All.”  This letter has been foundational for a moral analysis of Catholic participation in economic life in its emphasis on the common good and concern for the poor, as well as its insistence that the economy should not be measured just by what it produces, but also according to how it treats human dignity.  This pastoral letter was intended not just to form Catholic consciences, but also to influence economic policies and behaviors on a more institutional level, which is what we are concerned about when we go to vote in November.  We will look at some of the major themes and principles set forth in these documents first, and then we will go on to look at how these principles might inform and guide our own economic decisions.

II. Economic Justice for All

“Economic Justice for All” does not embrace a particular economic theory, but it does turn to Scripture and tradition in order “discover what our economic life must serve, and what standards it must meet” (EJA 12).  The fundamental theme of the pastoral letter “Economic Justice for All” and for Catholic social ethics more generally is that as Christians, we do not measure the economy just according to what it produces but also according to whether it protects or undermines the dignity of the human person.  The economy is not a good in itself, but is judged to be good according to what it does to human beings.  Human dignity can only be fully realized in community, so the economy can be judged further by how it strengthens communities.  More specifically, this means that the economy cannot undermine any groups ability to participate in or contribute to the economy, and it must take special care to support the poorest and most vulnerable in society, such that their most basic needs–life, food, clothing, shelter, medical care, education, employment, and rest–are provided for.  Finally, the economy includes both public and private institutions that work together and have a responsibility to enhance human dignity.  The government is not the sole moral agent in this endeavor, and the bishops recognize the inherent limitations of the government, but also its positive obligations to form just laws and to intervene in the economy when when human dignity is not being upheld.  Voluntary and non-governmental organizations play a vital and indispensable role but cannot replace the just functioning of government.  To sum up the major point of the letter, it is “based on a long tradition of Catholic social thought, rooted in the Bible and developed over the past century by the popes and the Second Vatican Council in response to modern economic conditions. This tradition insists that human dignity, realized in community with others and with the whole of God’s creation is the norm against which every social institution must be measured” (25).

The letter also puts forward certain ethical norms in the form of duties, rights, responsibilities, and virtues.  The first of these is solidarity.  Solidarity is social friendship and civic commitment that makes life in society possible.  Solidarity emerges from one’s sense of dependence on society, and one’s obligations towards it.  Solidarity between various social institutions like the government, corporations, and non-governmental organizations involves a recognition that all of these organizations belong to and benefit from the same society, and as a result, they have a responsibility to work for what is good for that society.  United in this orientation towards the common good, different social organizations will play different roles, but the virtue of solidarity ensures that the goal is the same.  The virtue of solidarity is supported by the principle of subsidiarity.  The principle of subsidiarity says that it is wrong to give a larger association a task that can be accomplished by a smaller organization or an individual.  This principle guarantees institutional pluralism, providing for the creativity and initiative of different social agents with different capacities for action.  The principle of subsidiarity strengthens the virtues of public service and responsible citizenship on all levels of institutional life.

Another important principle emphasized in the letter is the virtue of justice.  There are three different manifestations of justice.  The first is commutative justice which demands that human beings are treated fairly in agreement and exchange.  This includes respect for promises, fairness in contractual agreements, and appropriate compensation for work through just wages.  The second manifestation of justice is distributive justice which demands that the earth’s resources be fairly allocated such that all person’s can have their material needs for food, clothing, and shelter provided for.  Taxation and welfare policies are a matter of distributive justice.  Finally, social justice demands that persons participate in the life of society, and also work for conditions so that those who are excluded from participation may be integrated.  Social justice requires that everybody participate in working for the common good, specifically by organizing economic and social institutions that enable people to participate more fully in building up a just society that respects the fundamental dignity of each individual.  Social justice also demands that we not sit back and wait for the government to solve our social and economic woes, but rather, examine and change when necessary our way of living in light of the needs of the poor, limiting our consumption and expanding our generosity.  Social justice requires this not just on the individual level, but also on the institutional level, making cultural and economic institutions more supportive of the freedom, power, and security of individuals and families.

III. Looking at the Issues

It is not the Church’s job to create or promote a specific political or economic system.  Rather, the Church encourages all reforms that may transform economic arrangements into a fuller realization of the common good, and challenges all practices and institutions that detract from this goal.  Catholic social ethics is useful in its provision of the principles that we have just laid out that allow us to evaluate a particular economic system or policy whereby we ask “what is the impact of this system on people and does it support or threaten human dignity.”

Right now in the United States, we are potentially facing a grave and complex economic situation that will have vast repercussions throughout the economy.  Catholic social ethics does not provide the resources to solve the current economic problems, but it does provide resources for evaluating how to move forward as individuals, as organizations, and as a nation with prudence and justice.

Human Dignity: First of all, it is important to realize that our current economic situation will potentially have a large human impact.  Families have already and are continuing to lose their homes.  Small businesses are unable to get the credit they need to conduct their affairs.  People are losing their jobs and their savings.  Economic arrangements must have as their primary purpose the protection of human dignity.  Any government-level solution that does not provide for those hardest hit by the economic crisis is inadequate.   Citizens often feel far-removed from the political process, but I would recommend writing and calling legislators, writing letters to the newspaper, and taking other initiatives to inform legislators and voters that the primary goal of any proposed legislation must be the protection of human dignity, especially of the poorest and most vulnerable.

Responsibility and Accountability: The reason that we have seen so many banks in recent weeks collapse, gravely endangering our economy, is due to the irresponsible and reckless behavior of both private investors and government.  The sub-prime mortgage industry was fueled by some good intentions to provide homes for the poor and some imprudent legislation that made this goal a reality but also encouraged irresponsible lending practices.  It was also fueled by the greedy exploitation of many vulnerable people, as seen in the manipulative lending practices of certain banks.  Regardless, business people who took unnecessary risks or engaged in such exploitative behavior should not be rewarded or allowed to avoid taking responsibility for their actions, and any legislation put forward should take special care not provide benefits to the wealthiest individuals while neglecting the poorest.   Additionally, any financial assistance legislation should be accompanied by reforms promoting transparency and accountability for both business people and the government officials who form such legislation.  I am also highly critical of the way government officials have conducted themselves in recent years, despite warnings that the economy was in danger, and the recent failure to draft a bill that could get through the House, despite bi-partisan efforts to do so, clearly indicate that the government does not have a good idea of how to move forward.  It would be irresponsible and imprudent to give too much power to the government at this time.  This includes handing our Secretary of the Treasury a check for hundreds of billions of dollars when he has admitted that he does not know if it will work to fix our economic problems.  The call for responsibility and accountability must extend to government officials as well, and Catholic voters should be wary of giving too much power to the government without ensuring that this power will be well-used to promote the common good.

Organization and Subsidiarity: The social ethics tradition of the Church strongly emphasizes the right to organize, which is often taken to mean the right to form labor unions, but organizing also extends to forming social organizations like Catholic Charities and the Catholic Worker Movement.  This goes hand in hand with the principle of subsidiarity.  Again, this principle says that all levels of societal organization have a responsibility to participate in work for the common good, and that the power of individuals and small organizations to provide for a need in society should not be taken away and given to a larger organization like the government.  More practically for our current economic situation, this means that Catholics have a responsibility to work within already-existing organizations like Neighborworks America and to form new organizations where necessary to come to the aid of people in need.  This includes providing shelter for the homeless, and financial support for those in danger of losing their homes.   The Catholic Church has a wonderful history of providing for the needy, especially in this country, rather than relying solely on the government.  We must, as Catholics and as disciples of Christ, take the initiative, make the sacrifices, and innovatively persevere in continuing this tradition of social justice.  At a time like the present, when there is so much uncertainty about what is prudential on a large scale, Catholics are called to even more responsibility on a small scale.  I am much more interested in what Catholics are doing to help the poor and homeless in their own community than I am in hearing how they are voting.

Again, the Church does not affirm one specific economic or political theory, nor does she have the technical resources to put forward a specific legislative solution.  Some may think that the most vulnerable in society can be protected by keeping taxes low for business to provide jobs and stimulate the economy.  Others may think that raising taxes, especially for those in the highest income bracket, would best serve the country’s economic needs at this time (although both Obama and McCain support cutting taxes for the middle class).  There are different possible solutions to our current economic woes, but Catholic social ethics teaches that there are some things that are clearly not allowed, and some things that are clearly required.  As Catholics, we are called in this election season and at all seasons to examine our own actions, the actions of the businesses and organizations that we participate in, and the actions of our government and ask “How is this protecting human dignity and advancing the common good?”

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