Pope Francis Has Spoken, and Now We Must Acton It

Pope Francis’s apostolic exhortation, Evangelii Gaudium [1], has begun to create a stir in the expected places, not least of which is the Acton Institute [2], the economically libertarian think tank in Grand Rapids, Michigan, co-founded by Father Robert A. Sirico, a priest of the Grand Rapids diocese. Explanation, confrontation, or downright renunciation on the part of the Institute was inevitable with the sorts of things that Pope Francis has been saying, the Holy Father being no libertarian. The Institute would like to claim for itself fidelity to Catholic Social Teaching, and while it is true that Pope Francis has been nothing but consistent with the teachings of his predecessors, the mainline media attention given to his social pronouncements has made a point of reckoning certain. That point was reached with the publication of Evangelii Gaudium.

It was thus to be expected that the Institute’s Research Director, Samuel Gregg, has written an article for National Review Online [3] taking the Holy Father to task for his naiveté. Interestingly, he says in the article that he by no means intends “to imply that all of Pope Francis’s observations about economic life are naïve or simply mistaken,” thereby hinting that he thinks some of it is, and he elucidates for us where he thinks the Pope has gone wrong.

For starters, he takes issue with this passage of Evangelii Gaudium:

“As long as the problems of the poor are not radically resolved by rejecting the absolute autonomy of markets and financial speculation and by attacking the structural causes of inequality, no solution will be found for the world’s problems or, for that matter, to any problems. Inequality is the root of social ills.” (¶ 202)

Mr. Gregg objects that there are no countries in the world “in which markets operate with ‘absolute autonomy.’” The Pope, then, he argues, is addressing a nonexistent problem, and his concerns, thus, have no practical meaning.

To take Mr. Gregg’s objection seriously we must forget that anyone is advocating for markets unencumbered by regulation. In a word, we must forget that there are libertarians in the world. We must further forget that economic adjustments on behalf of the poor are ever denounced by free market advocates on the ground that it disrupts the purported equilibrium that free enterprise affords. The Pope is not making a statement about the regulatory circumstances of any country, but is saying that free enterprise dogmas are inadequate excuses for neglecting the poor, and there are surely advocates of the contrary view.

The abundance of regulations faced by the world’s economies is of concern to Mr. Gregg, and he is concerned that the Pope is not adequately taking them into account. Here, too, Mr. Gregg misses the point. Pope Francis is not calling for regulations on the activities of businesses generally, but governmental intervention to ensure that legitimate human need is attended to. Adequate and proper distribution of resources can be accomplished with many or few regulations, and Mr. Gregg’s complaint about a voluminous regulatory regime is irrelevant to the issue the Pope is addressing.

Mr. Gregg’s indulgence in ignoratio elenchi continues when he criticizes the Holy Father for making this statement:

“While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation.” (¶ 56)

As far as Mr. Gregg is concerned, only the small and insignificant cult of anarcho-capitalists could be implicated here. No one outside of that group, he says, rejects “any form of regulation whatsoever.” But, again, the Pope isn’t talking about any form of regulation whatsoever. He is talking about a growing wealth imbalance and those who argue for a laissez-faire approach to that social issue. There are indeed few proponents of a lawless marketplace. But the partisans against governmental intervention to redistribute wealth are many. 

Now Pope Francis certainly tweaks the noses of the devotees of an economic philosophy that has had many adherents in the United States when he says this:

“In this context, some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system.” (¶ 54) 

The Pope is of the firm conviction that we “can no longer trust in the unseen forces and the invisible hand of the market.” (¶ 204) He has a very good reason for this conviction: there are no facts to back up such a trust. Of course, that would have to be true, since, as Mr. Gregg acknowledges, there are business regulations everywhere.

Mr. Gregg tries to counter with two points. First he notes that “opening up markets throughout the world has helped to reduce poverty in many developing nations.” He cites East Asia as his example. But Pope Francis is not criticizing the existence of markets. He is criticizing the notion that in a free market the abundance of the rich will inevitably “trickle down” to the lower economic strata. 

In any event, the world is not in such a utopian condition. What world is Mr. Gregg looking at? Were the garment workers who died in the Bangladesh factory collapse not being paid a mere $50.00 a month? [4] Is child labor no longer a problem in the world? The incentive toward paying the lowest possible wages is a continuing feature of capitalism. The fact that many still suffer under this scourge is not justified by the fact that there are examples of prosperity to be found.

Mr. Gregg’s second point is that “it has never been the argument of most of those who favor markets that economic freedom and free exchange are somehow sufficient to reduce poverty.” Here, Mr. Gregg seems to have stumbled into agreeing with the Holy Father. Free enterprise surely is not sufficient toward that end. Other necessities that Mr. Gregg points out are “stable governments that provide infrastructure, property arrangements that identify clearly who owns what, and, above all, the rule of law….” But he leaves out one very important requirement.

In order for an economy to prosper, its businesses must prosper. In order for businesses to prosper, they must have customers. In order for businesses to have customers, they need enough people who are able to buy what they are selling. If an economy is to thrive there needs to be enough people with a sufficient income to buy things beyond basic necessities. That is why the downward pressure on wages that is characteristic of the free enterprise system is ultimately self-defeating. Businesses need markets, and if a country’s population is too poor to make enough purchases the economy will suffer. Thus, true living wages are a necessary component of any well-run economy. Mr. Gregg doesn’t mention this point.

In Evangelii Gaudium Pope Francis is making a case for “a better distribution of income….” (¶ 204) Mr. Gregg claims not to be alarmed at the suggestion, but is quick to assert that “the standard wealth-redistribution policies that are often regarded as indispensable to poverty alleviation have failed to achieve their goals.” One would think from this that the Pope was advocating a welfare state, but Mr. Gregg is honest enough to concede that the Holy Father holds that welfare “projects, which meet certain urgent needs, should be considered merely temporary responses.” (¶ 202)

What the Pope is after is structural reform. He wants an economy where the dignity of work and a just allocation of wealth meet together. What he wants are “decisions, programmes, mechanisms and processes specifically geared to a better distribution of income, the creation of sources of employment and an integral promotion of the poor which goes beyond a simple welfare mentality.” He is saying nothing more than that we can do much better, and should, therefore, do so.

Jack Quirk