The Irish Church has been devastated by the abuse crisis. It’s reputation and moral standing has never been lower. Fortunately, there is light at the end of the tunnel. The Irish bishops are regaining their moral voice, and it is a loud, prophetic, voice. A week before the election, they have issued a document on the economy, combining the grace and wisdom of Benedict XVI with the strident and urgent tone taken by Pius XI to denounce the financial sector during the Great Depression. It is quite possibly the best piece written by the Church on the global financial crisis to date (in English at least – my German is not good enough to be able to read Cardinal Marx’s book). It is a strong denunciation of the modern capitalist ethos. Americans in particular need to read it.
As a backdrop, it is worth understanding what happened in Ireland. It is eerily similar to the American story, albeit in a far smaller pond with far smaller players. Irish policymakers became intoxicated by the culture of deregulation, low taxes, and the virtues of the free market. The result was the much-heralded “Celtic tiger” economy, but this was a house built on sand. As the economy expanded, so did poverty and inequality. Much of the growth came from construction and financial services, fueled by a nexus of greed between bankers, property developers, and politicians. And then it all came crashing down. Michael Lewis has a great write-up of the Irish debacle in Vanity Fair. Just like in the United States, the results were crippling unemployment, skyrocketing public debt, and a legacy of bankruptcy. (There is one difference – the Irish bankers who caused the crisis are in hiding, while in the United States they are being toasted, hired by Washington, and once again influencing policy).
The bishops get right to the heart of the problem – a “radical individualism” that manifested in a “bonus culture”, which in turn gave rise to “inequality and damage to social cohesion”. This bonus culture is “regrettably still a feature of banks and financial institutions”. They lay out the problem as follows:
“In common with many countries in the so-called developed world, which are increasingly shaped by the cultural mindset of advanced capitalism, we can forget that not everything is earned and that not all actions are motivated by self-interest, albeit enlightened self-interest. For example, one’s health, personality, physical and intellectual endowments, not to speak of the love which one received as a child, one’s early schooling environment and those friendships that shape the quality of our adult lives, are all received as gift…Combine confidence in the self-sufficiency of the individual – the conviction that everything that one receives is earned/merited – with a complimentary set of beliefs which hold that one can measure the worth of one’s endeavour by the size of the monetary reward. In this mix, one has a set of conditions which are ideal for the creation of what has been described as a bonus culture and extremely difficult for the promotion of the civic virtues of active citizenship and public service that are the life-blood of a functioning participatory democracy. It is our firm conviction that the neglect of this gift dimension of personal and societal living lies at the root of what has gone wrong in Irish society. If this proves to be the case, there is a need to critique exaggerated claims of independence/self sufficiency which give rise to and sustain a ‘bonus culture’”
The result is an “increase of social inequality, which is an inevitable consequence of this bonus culture and the accompanying institutional failure”. This “brings with it the serious risk of causing a breakdown in social cohesion – the bedrock of a properly functioning democracy and an orderly economy” (see Caritas in Veritate, 32).
The root of the problem lies with liberal individualism:
“The current crisis in Ireland can, at least in part, be explained by reference to the perception of increasing societal acceptance – if admittedly from a very low base in comparison with other European countries – of what has been described as a radical or expressive individualism. To the extent that this perceived cultural trend is borne out in practice, it will almost inevitably be followed by a loss of the proper balance in our self understanding as individuals and as members of society – a loosening of the bonds of solidarity.”
The bishops note that it has become increasingly difficult to challenge this “dominant individualist/ consumerist societal ethos”. This was not the case in the past, when regulation and the welfare state were put in the service of the common good:
“There are historical precedents which offer some hope that the excesses of advanced capitalism can be checked – the emergence of a robust regulatory environment and a concern for the welfare state in the decades after the 1929 Wall Street crash and the Second World War being a case in point. Alongside the successes of the Labour movement in the post-war years, one can also highlight the remarkable achievements of Christian Democracy which emerged from the ruins of Germany at the end of World War II, motivated by a desire to keep in balance the core principles of freedom, enterprise and social responsibility. In the decades that followed, up until the early 1980s, both the Social and Christian Democrats provided an important counterbalance to the excesses of consumerism/capitalism.”
“For well over a hundred years, various strands of socialism were united in challenging the priority which capitalism accords to economic efficiency and individual liberty over social justice and a concern for societal cohesion. With the diminishing influence of socialism on the political landscape over the past thirty years there is some evidence to suggest that we are witnessing for the first time the emergence of a more radical individualism which has little sensitivity to the nature and significance of belonging to a society.”
They tease out some problems with the capitalist model:
“The recent economic crisis offers evidence to suggest that, with the increasing cultural dominance of the consumerist ethos of advanced capitalism, we have lost the correct balance between the four essential elements of a just and sustainable economic model: freedom, efficiency, solidarity and the protection of the environment. Instead of the historically normal patterns of subordinating the economy to society, capitalism effectively operates under a political system whereby self-regulating markets subordinate society to the logic of the market…There is always the danger that the goal of economic effectiveness will crowd-out vital ethical considerations and core values, such as solidarity and the common good…In such a consumerist milieu, efficiency will always be perceived to be more important than fairness, and the economic need to down-size will take precedence over concern for the welfare of employees.”
What does this all mean going forward? It means policy grounded in the common good. Banks and financial institutions “must be at the service of society and contribute to the common good”. The common good also calls for “the centrality of justice and equity…and the need for those in power to pay special attention to the more vulnerable members of society”. The bishops question the minimum wage cuts, especially since they mostly affect migrants “who are not represented by unions and have no power”, and when others continue to enjoy six-figure salaries. While equality of opportunity is essential, it is not enough – “a more equal society will never be truly fostered in the absence of concern for equality of outcomes”. Incomes policy must be based on solidarity, and incomes gaps are unacceptably large. Quite provocatively, they note that Irish taxes are too low to pay for European standards of public services. And of course, the earth’s resources must be used responsibly.
Let’s turn now to the United States. Everything in this document applies also to the United States – many times over. The United States embodies a radical individualism on steroids. Not only is the culture more infected by this malaise, but too many Catholics are out defending it. You see Catholic Vote and Inside Catholic applauding the principles of the tea party, the very embodiment of this flawed cultural capitalism, predicated on individualism. There are plenty of right-wing Catholic groups in Ireland and elsewhere, that are every bit as strident on abortion and other cultural issues as their American counterparts (google ‘Youth Defense”). But it would be exceedingly rare to find a Catholic group in these places extolling the virtues of the individualist mindset in this fashion. America has a problem. Catholics have assimilated a little too well.
But where are the bishops? Why can they not write a document like this? Why do they appear so timid? Is it because they are afraid of ruffling the feathers of those who have bought into this flawed cultural mindset of advanced capitalism? Look back after the last few years. As the greatest crisis since the Great Depression unfolded in 2008, the US bishops instead unleashed their energy to tackle things like FOCA – an important issue for fund-raising, but not for the policy agenda. They complained about Obama talking at Notre Dame while the economy was collapsing all around them. To this day, we have not seen a coherent and comprehensive statement on the philosophical and cultural problems that led to the crisis, despite the leadership shown by Pope Benedict. It’s been a quarter century since their last major document on the economy. As with the abuse crisis, the American bishops should follow the lead of their Irish brethren. They should start standing up to the angry voices of the American right, who are trying to twist Catholic social teaching into something very ugly indeed.