Infallible Economics?
Recently we had a good debate over Pope Benedict XVI's comments about how an economy should serve man. For further illumination, I thought this editorial from the Vatican newspaper was somewhat extraordinary. The editorial notes that "without a true strategy for growth - which moreover is in contradiction to the tax levy itself – taxation in all its forms only permits further growth in public spending."
It goes on, in a part that seems to be channeling Hayek:
During a prolonged crisis, inheritance taxes, new forms of taxation or similar alternatives reduce or wipe out resources for investments, discouraging the trust of investors, penalizing the cost of the public debt and the possibilities of its renewal at its expiration. In this context, imposing taxes on property and on income is equivalent to a suicidal anti-subsidiarity of the state to the citizen. Those who legally possess assets, on which they have paid the proper taxes, have contributed to creating wealth and, thanks precisely to these assets, continue to produce them with investments and consumption.
Further forms of taxation would not be synonymous with solidarity but only with greater public spending and, perhaps, a higher debt and more widespread poverty. High taxes penalize saving, generate distrust in the ability to stimulate recovery, hit families and prevent the formation of new ones, as well as creating uncertainty and precariousness in employment. In short, they lay the foundations for another phase of unsustainable development.
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Jun '10
Re: Infallible Economics?
Subsidiarity is a crucial and oft-overlooked bedrock of Catholic social teaching: "This tenet holds that nothing should be done by a larger and more complex organization which can be done as well by a smaller and simpler organization. In other words, any activity which can be performed by a more decentralized entity should be. This principle is a bulwark of limited government and personal freedom. It conflicts with the passion for centralization and bureaucracy characteristic of the Welfare State."
Re: Infallible Economics?
The only possible explanation for this editorial? That Bill McGurn has been working undercover in Rome.
Apr '11
Re: Infallible Economics?
You need to forward this editorial to Richard Epstein to help disabuse him of some of his erroneous beliefs about Catholic thinking regarding economic issues and social justice.
Dec '10
Re: Infallible Economics?
A passion now exhibited by too many Catholics. That and pacifism.
Nov '10
Re: Infallible Economics?
On the subject of the Pope and economics, there have been a couple of good posts by David Goldman (aka Spengler) at Asia Times Online.
Mar '11
Re: Infallible Economics?
That or someone at the Vatican is a Ricochet member. ;)
Sep '10
Re: Infallible Economics?
Even better would be inviting Dr J Brian Benestead, author of a quite good book on Catholic social teaching and social doctrine to discuss both his teacher, the late Fr Ernest Fortin, SJ (a man whom Harvey Mansfield called "The Christian Socrates"), Fr Fortin's writings on these two seminal Papal encyclicals, and this paper by Stephen P White on Catholic Conservatives and the Common Good at the Catholic Thing.
Not that I've read them or anything. And I have no idea who that Hadley Harkes fellow is, either.
Sep '10
Re: Infallible Economics?
Give Me Liberty
That or someone at the Vatican is a Ricochet member. ;) · Aug 30 at 12:40pm
Perhaps they own Ricochet. We're very secretive you know.
Mar '11
Re: Infallible Economics?
Give Me Liberty
That or someone at the Vatican is a Ricochet member. ;) · Aug 30 at 12:40pm
Very interesting editorial. From this line:
"In fact, the size of the debt, its cost and the possibility of renewing its expiration – variables that are such a cause of anxiety to markets and governments – may only be reduced and absorbed, in a phase of difficulty such as the current time, with economic growth."
The editor recognizes that debt is best examined as a percentage of GDP. It would seem that someone there is reading the Wall Street Journal.
Dec '10
Re: Infallible Economics?
Unfortunately, I've never read anything coming out of the Vatican which didn't give liberals an out:
"Authentic global solutions to the crisis must therefore take into account what gave rise to it, its extent and the time and means required to resolve it."
And to the liberal mind, what gave rise to the crisis? The Bush tax cuts. Unfunded wars. Corporate greed. I'll be forwarding the article to my liberal Catholic friends. I'll let you know which one(s) they use. :-(
Jun '10
Re: Infallible Economics?
Note that the Catholic Church--it's a very big church--is also talking to the Third World when they make pronouncements. In the Third World, over-taxation is never the problem. There, the problem is often the uncaring exploitation of workers. The Vatican is always talking to both ends of the spectrum.
Dec '10
Re: Infallible Economics?
Good point, although I think the problem in the Third World is more broadly described as corruption and lack of individual rights (especially property rights).
Re: Infallible Economics?
Western Chauvinist, I've read some pretty statements about economics in my time from the Catholic church. Most of them owe something to the old idea of a "third way" between capitalism and socialism. As Valclav Klaus once noted,
"the third way is the fasted wayto the Third World."
The saving grace is that the bedrock principles of Catholic teaching -- the "sacred" right of private property, and the imperative of subsidiarity (keep decisions as low to the ground as possible) -- operate as great correctives and undergird a free market economy. In the last few years, with prodding from people such as Michael Novak, we have advanced a great deal from the simple idea that compassion equals more government.
Let's not be afraid to admit there have been some very dumb things advocated by the Vatican's paper from time to time. That said, this was a terrific editorial for pointing out what is wrong with raising taxes to deal with debt -- and the debilitating effect such a move would have on families and society and the economy. And they should get credit for it.
Sep '10
Re: Infallible Economics?
And they should get credit for it.
Did you google the editorial authors name?
Dec '10
Re: Infallible Economics?
Oh, yes, Mr. McGurn. I don't blame the author of the article for how it will be interpreted in liberal Catholic circles. I blame the JustFaith "solidarity" crowd and other liberal Catholic organizations for leading some in the flock astray.
If the Magisterium has any culpability, it is in tolerating ostensibly Catholic organizations which are more faithful to liberalism than they are the faith. The Magisterium moves too slowly in response for some of us.
Yes, Michael Novak has been very helpful, but let's not forget Fr. Sirico at the Acton Institute. I have it first hand from him that he is as concerned with JustFaith and like organizations as I am. And his organization is committed to teaching the truth about economics.
If Ricochet is taking suggestions for guest bloggers, may I nominate Fr. Sirico? He is a gifted communicator and fits the Rico ethic of persuasive civil discourse perfectly. It would be a coup to recruit him.
Jan '11
Re: Infallible Economics?
Bill McGurn:
Let's not be afraid to admit there have been some very dumb things advocated by the Vatican's paper from time to time. That said, this was a terrific editorial for pointing out what is wrong with raising taxes to deal with debt -- and the debilitating effect such a move would have on families and society and the economy. And they should get credit for it.
Of course, another (perhaps more cynical) view is that ... if even the Vatican gets it ...
I'm very hopeful about the economic teachings of the church, especially in the next few years. It is entirely likely that the next pope will come along soon, and the smart money is on the new pope coming from the so-called Global South. That means Africa or Latin America.
Had we faced a Global South pope twenty or thirty years ago, that would have been disaster. He would have likely been a radical. But I think the last ten or fifteen years has been instructive. Communism is gone, and the closer that governments have veered toward socialism, the worse it has gone for them.
Catholics CAN learn. Just takes a few centuries.
Dec '10
Re: Infallible Economics?
Pseudodionysius: And they should get credit for it.
Did you google the editorial authors name? · Aug 30 at 2:57pm
Yoish! Pseudo. Is there anything you (or google) don't know? Ettore Gotti Tedeschi.
Sep '10
Re: Infallible Economics?
Western Chauvinist
Pseudodionysius: And they should get credit for it.
Did you google the editorial authors name? · Aug 30 at 2:57pm
Yoish! Pseudo. Is there anything you (or google) don't know? Ettore Gotti Tedeschi. · Aug 30 at 6:02pm
Well, lets be fair to the man:
Linkie,
Linkie
Linkie
Winkie
Sep '10
Re: Infallible Economics?
Vatican bank’s president criticizes America’s Keynesian economic policies January 14th, 2011 Credit: Catholic Culture web site
Edited on Aug 30, 2011 at 7:25pmSep '10
Re: Infallible Economics?
I think the technical term for that Steynsian broadside against Keynes is, as the kids used to say:
"P'owned"