When it comes to economics does Pope Francis know what he’s talking about? Allister Heath, writing in the Daily Telegraph doesn’t think so.
I must take exception to the Pope’s views on economics and business. His hostility to capitalism, shared by the Church of England, is tragically misplaced. He has repeatedly savaged free markets, most recently at a Vatican conference this week, and aligned himself with the views of Thomas Piketty, the far-Left intellectual who obsesses about inequality and advocates crippling taxes on income and wealth.
In one key intervention, the Pope claimed that the “absolute autonomy of markets” was a “new tyranny”. It was a strangely inaccurate vignette of the modern economic system, which is characterised by not-so-free markets that are routinely bailed out, subsidised, taxed, capped, fettered, regulated and distorted by activist governments and their monetary and fiscal policies. North Korea is a genuine tyranny; free trade and genuine free markets are anything but.
It gets worse, unfortunately. At the height of Pikettymania, and before many leading economists punched holes in the French economist’s thesis, the Pope took to his Twitter account to state, without any caveats or context, that “inequality is the root of social evil”. He was clearly referring to differences in financial outcomes and wealth – and crucially, not to poverty or to inequalities of opportunity, both very different concepts.
I am the first to admit that I know little about economics, but it does seem to me that the critics of Pope Francis have a point. The pope comes across as saying “Rich people are all bad and poor people are all good.” It’s simply not that easy. Plenty of rich people are generous while plenty of poor people are greedy. Surely we should get behind the simplistic slogans to promote the true values of Christian charity that operate wherever people engage in commerce and politics.
The social teachings of the Church uphold the right of private property and just reward for labor while also expecting the rich to serve the common good with their wealth.
The Pope also recently criticised “trickle-down” economics – in fact a caricature of free-market arguments – in scathing but equally incorrect terms. “There was the promise that once the glass had become full it would overflow and the poor would benefit. But what happens is that when it’s full to the brim, the glass magically grows, and thus nothing ever comes out for the poor,” he said. It is hard to reconcile such a baffling statement with recent economic history. Even the poorest among us today have access to medical technologies which the richest of the rich couldn’t even have dreamed of a century ago. The number of people living in extreme poverty in emerging markets has collapsed from half the population in 1981 to 21pc in 2010. A giant new global middle class has emerged in China, India, Africa and Latin America.
Yet no real free-marketeer believes that growth alone is enough to solve all problems. In the West, wages are under pressure and youth unemployment elevated, among a myriad other urgent issues. The solutions are complex; they include boosting entrepreneurship, improving education and more flexible labour markets. They certainly do not involve wholesale, ill-informed attacks on the market economy.
As for me, in my own ignorance, I want to listen to what the pope said in entirety and learn more about this complicated matter, but I worry a bit that Pope Francis, in his zeal may be blundering here somewhat. If he is, then it is a shame because he will be weakening his authority in other areas by doing so.
Read the whole article here.