Teluk on John Paul II and Capitalism

If one accepted Tomasz Teluk's Tech Central Station column The Pope and Capitalism at face value, one would have to conclude that John Paul II is little short of a fellow traveller with the Mises bloggers:

[M]ore and more philosophers suggest that he has read Human Action by Ludwig von Mises, and that this magnum opus by the Austrian economist probably influenced the Pope in certain fragments of his early book, The Acting Person. The Pope's criticism of so-called "bureaucratic governance" is akin to Mises' "bureaucracy." The Pope's "personalism" is philosophically very close to the Austrian School, and is based on the same Aristotelian and Thomist traditions. ...

John Paul II reminds us that property rights are natural rights. He also underlines the significance of the freedom of human action and freedom of people's economic activities. The Pope reveals to us the change in the global economy. Wealth is no longer tied only to land, natural resources or capital. Knowledge, technology and know-how are important elements of contemporary fortunes.

On the question of ethics, John Paul II indicates the social context of the entrepreneurialism. The individual, the entrepreneur, satisfies societal needs. Building on that, the free market is the most effective way to use society's resources. In Centesimus Annus, the Pope refers to it either as business economy, market economy or free economy. The free market, he writes, is the best way to promote the welfare of families. But the Pope also criticizes materialism and consumerism - alien values to Christianity. He argues that profit is not the only economic goal. Company growth is the primary indicator of good business conditions, he says, but the human individual should be the most important element in economic activity.

The Pope exhibits a great depth of economic understanding. Free-market capitalism offers the antidote to bankrupting socialism. Capitalism, to be fair, should be based on Christian ethics. John Paul II says that democracy has many faults: politicians more often work for themselves, not the people. He criticizes the conception of the welfare-state. Interventionism and bureaucracy deprive people of the responsibility for themselves, thus promoting over-regulation of the market. The welfare-state wastes human energy and creativity. Bureaucracy serves the bureaucrats, not the society.

What are the state's functions? The reader can easily detect that the pope's ideas are close to the classical liberal conception of the state. Economic activity could not be effective without institutions. The main goal of the state is to guarantee laws and to secure individual property rights and liberty. Commentators underline that John Paul II allows a certain amount of intervention by the state, but the dialogue about liberalism is revolutionary in Roman Catholic social thought.

As a Catholic neoconservative with libertarian leanings, I wish Teluk was right. But he is not. Granted, Teluk is to be credited with acknowledging that John Paul's thinking on these issues is more complex than the simple libertarianism of Austrian economists. Yet, I think even with those caveats he still misconstrues the direction of John Paul's thought.

Consider the role of profit. Orthodox economics teaches that the social function of a business is profit maximization. In contrast, the Catechism damns profits with faint praise: they make possible the investments that ensure the future of a business and they guarantee employment." Granted, Pope John Paul II’s encyclical Centesimus Annus recognized a legitimate "role of profit," but merely "as an indicator that a business is functioning well." Hence, the recently revised Catechism further explains that: "Those responsible for business enterprises are responsible to society for the economic and ecological effects of their operations. They have an obligation to consider the good of persons and not only the increase of profits."

Or consider the Pope's discussion in Centesimus Annus of worker involvement in workplace governance. In the course of that discussion, the Pope asserts that someone "is alienated if he refuses to transcend himself and to live the experience of self-giving and of the formation of an authentic human community oriented towards his final destiny, which is God." This Papal dictum smacks of the Aristotelian error of monistic perfectionism; i.e., the view that there is one supremely valuable way of life. Indeed, the Pope appears to make the same error for which he condemned socialism; namely, the belief "that the good of the individual can be realized without reference to his free choice." Hence, even though he elsewhere claims the Church has "no models" to present, the Pope seemed to endorse codetermination - rather than entreprenurial capitalism - as the appropriate form of workplace governance.

In sum, I think Teluk is correct when he suggests that John Paul's work has begun a "dialogue about liberalism [that] is revolutionary in Roman Catholic social thought." John Paul II’s encyclicals temper much of what was said in the US Bishops' pastoral letter on economic justice, for example. Yet, to suggest that the Pope embraces "free-market capitalism" as "the antidote to bankrupting socialism" surely overstates the case. The Christian libertarian ideal of free markets, a free people, and a free Church remains one that much of Catholicism holds at arms-length, even though John Paul II has created a big tent in which those of us who hold to that ideal can find a home.