A (Second) Response to 'Just Economics'
I have read and re-read Dr Stacie Beck’s article, "Just Economics." I still wonder who these Catholic “social justice advocates” are whom Dr. Beck is criticizing. She names only a fourth grade religion text.
Not having seen that text, one presumes that she may be right—about that text. It may not teach muscular self-reliance and ambition, and perhaps her main argument is that we ought to be doing that. If so, she would have done better to go to something like Emerson’s Self-Reliance. Or even, it might be said, to Ayn Rand’s The Fountainhead.
For like Rand, the doctor goes very much further than urging self-reliance. She turns to a general criticism of the church’s “social justice agenda.” It clearly troubles her, though why is no so easy to discern. She is certain, though, that the whole Catholic Church “should think through much more carefully what social justice entails in a modern market economy.”
This is quite a leap: from correcting a fourth grade text to admonishing the whole Catholic Church. That may be possible to Dr. Beck because her reading in Catholic social thought is too limited—no sign, for instance, of America’s John Kavanaugh, S.J., or the American bishops’ teachings.
The thinking here is mistaken in three ways. To begin there, her own first principle will not support a social agenda. It sounds like current economic theory: “The goals of social justice assume a society prosperous enough to support them.” Catholic social teaching assumes no such thing about the goals of social justice.
The “goals of the social justice” espoused by the church are not based on economics, politics or philosophy. In Gaudium et Spes, “the human person is the source, the focus, and the end of all economic and social life.” In Populorum Progressio, “from the human and supernatural brotherhood of man[rises] a three-fold obligation: mutual solidarity; social justice; universal charity.” In Laborem Exercens, “recall a principle that has always been taught by the Church: the principle of the priority of labor over capital.” And in Caritas in Veritate, “business management cannot concern itself only with the interests of the proprietors, but must also assume responsibility for all the other stakeholders.” In none of these do the goals of social justice depend society’s prosperity. They depend only on the equal dignity of each human being under God—owner, laborer, consumer.
That dignity, in the Catholic social agenda, calls for a society organized to offer sufficient labor for those who want and need it. Perhaps Dr. Beck could think more carefully about this lack of sufficient labor in the U.S. today. It is not a failure of government, of the consumer, or of labor; it is failure of capitalists.
How does it happen that so much capital lies idle today? Idle, that is, except for a specific kind of “rent-taking” that capitalism makes plenty room for. The price of gold rose after 2008 because very wealthy people were putting their capital into cold storage, not investing in a capitalistic blaze. Capital is still frozen. What would Dr. Beck’s social justice agenda do about this?
A second limit to the thinking here is Dr Beck’s devout embrace of the unbridled capitalism that is the current orthodoxy. That capitalism, Dr. Beck believes, and that capitalism “alone produces prosperity.” She states flatly, “There is no alternative.” Capitalism or nothing. This is too narrow a view even for a serious economist. Isn’t oligarchical China prospering? Isn’t tightly managed Saudi Arabia? Aren’t Denmark, Norway and Sweden fairly socialist and also prosperous?
The statement, “capitalism alone,” is not argument, it is dogma. And it is contrary to church social teaching. Pope Benedict, who has “thought carefully about what social justice demands in a modern market economy” before writing Caritas in Veritate, concluded that “Today's international economic scene, marked by grave deviations and failures, requires a profoundly new way of understanding business enterprise.” The church thinks that there is an alternative to the poorly regulated capitalism we now grieve under, if Dr. Beck does not.
That raises the third and final problem with the thinking here. Dr Beck disdains “redistributionism” and thinks that redistribution “through the tax and transfer system erodes prosperity and undermines the attitudes that created it.” There are two problems with that. The first is purely economic. It is the claim that high tax dampens development. However, some well known numbers make it hard to believe.
Dr. Beck considers economic evidence for that “embarrassingly scanty,” but as that does not deter her, it needn’t deter us. Compare American taxes to other great countries'. The top American combined income tax rate, federal and state, falls in the middle of the list of the major countries. Roughly, the American rate is at most 44 percent (for the highest incomes, and it seems to berarely paid). The rate elsewhere is higher: in Denmark it is 60 percent; in Belgium, 54 percent; in the Netherlands, 52 percent; in Japan, 50 percent. We also train Australia, Germany and Brazil. Now, these are prospering nations, no matter how you chop statistics. Their tax and transfer system has not eroded their prosperity, and Danes and Japanese are as entrepreneurial as anyone in Silicon Valley. The wisest economic conclusion is that we have no real data proving that higher taxes reduce productivity or prosperity.
The second problem with this disdain of “redistributionism” is not economic. It is philosophical and theological. It is the tightly held belief that wealth is the uniquely personal possession of the one who currently has it. Taxes for the common good are taking away what is mine and no one else’s. This is not Catholic social teaching.
In Populorum Progressio, Pope Paul VI urged attending to the Second Vatican Council’s teaching: "God intended the earth and everything in it for the use of all human beings and peoples. Thus, under the leadership of justice and in the company of charity, created goods should flow fairly to all." He turns this into the first principle, having nothing to do with any level of prosperity: “All other rights, whatever they may be, including the rights of property and free trade, are to be subordinated to this principle.”
This is a huge challenge to American capitalism. Americans think that the rich man’s wealth is his the way his skin is his. But it is not; his wealth is his like the air is his. He takes it into himself and uses it, but it is not his air. It is our air, some of which he has and uses for a time. That is how it is with his wealth: it is ours, some of which he has just now. And all political regulation must begin in that universal destination of wealth, as it does for the universal resource of air.
America’s wealth it is like the water that runs down our rivers and falls from heaven on our fields and forests. It is gift to us. The water may wet a woman’s face and hair, and she may drink it. But it is not her water. It is our water, some of which she has for a time. And all economic regulation must begin in that universal destination of water—and of wealth.
It is the same with the nation’s aggregation of wealth. What do the thousand dollar bills that some pile up say? THE UNITED STATES OF AMERICA, and in little print, “this note is legal tender for all debts, public and private.” And there are some numbers on each bill, indicating that the government keeps track of this sign of its wealth. The nation’s money is owned by the nation, first of all. This is the principle of the universal destination of resources and goods—of air, or water, even of money.
Dr. Beck does not seem to appreciate how far privilege has penetrated not only into pure economics and finances, but also into our laws and politics. Economists, after all, can only report what they think their data sees. It is hard for their data to see that every single one of the really rich 1,342 billionaires in the United States today stands at the headwaters of privilege—in law, education, opportunity—and believes that he is free to take whatever he can, or whatever he wants to take. He is correct in this nation at this time; he is not only not trammeled by the law from excess, he is helped by it. And currently, the super-wealthy make sure the laws remain favorable to them through their lobbyists. Anyone who believes otherwise should be kept from teaching our young.
So the Catholic social agenda—and all political and economic regulation enacted in this democracy—must begin with this truth: This land is our land. Currently, it does not seem to, and that is what the Catholic social justice agenda is really lobbying for, though maybe we need to do a better job with our fourth graders.
In the end, the article’s title is exact: Just in the sense of only or merely Economics. So the argument must not be mistaken for anything like a social justice agenda.
Joseph Tetlow, S.J., is the director of Montserrat Jesuit Retreat House in Lake Dallas, TX, where he gives retreats and workshops and writes. He previously served for eight years in Rome as head of the Secretariat for Ignatian Spirituality.