Pope Francis admirable goals but weak understanding of a true free economy

Thursday, October 8th, 2020

Pope Francis’s new encyclical Fratelli tutti touches on many issues relevant to national and international economic policy.

These will generate considerable debate and, given the influence of the Roman Catholic Church, deserve consideration.

The majority of the almost 200 pages focus on issues that go beyond economics and economic policy.

The Pope makes many valuable statements on the promise and perils of new communication technologies; the importance of forgiveness; his condemnation of war; and the need for more fruitful encounters across cultures.

I will stick, however, to the topics I am less ignorant, his statements on economics.

Only in passing does Pope Francis mention a principle which should guide the Social Doctrine of the Church and those who try to interpret its teachings: “There is no one solution, no single acceptable methodology, no economic recipe that can be applied indiscriminately to all.”

We do not find here statements about where to set interest rates, what industries should be nationalized or privatized, or where tariffs should be set.

That is good.

We find, however, a repeat of what we saw in his previous Encyclicals: a deep distrust of a world order which he sees as being controlled by economic interests and an unbridled neoliberal ideology that sustains them.

The document is best when focusing on topics where theologians have more authority: the view of the human person and teachings that come from the Scriptures. It is inspired by the life of St. Francis of Assisi.

Regarding “fraternity and social friendship” the Pope writes, “Francis felt himself a brother to the sun, the sea and the wind, yet he knew that he was even closer to those of his own flesh.”

This shows that although we should have a healthy respect for all Creation, there is a hierarchical order, and humans come first.

I have found no empirical evidence that more economic freedom leads to higher inequality.

The current Pontiff also mentions St Francis’s difficult and courageous trip to visit Sultan Malik-el-Kamil in Egypt.

The narration of that visit, and St Francis’s plea for respect and tolerance, serves to prepare the ground for the multiple mentions by the Pope of his visit with Grand Imam Ahmad Al-Tayyeb and the joint document that they released in February of 2019, Document on Human Fraternity for World Peace and Living Together.

The Pope comes from Argentina, a country which during most of his life has been one of the most nationalistic countries on Earth.

I welcomed therefore his statement that “a myopic, extremist, resentful and aggressive nationalism is on the rise.

In some countries, a concept of popular and national unity influenced by various ideologies is creating new forms of selfishness and a loss of the social sense under the guise of defending national interests.”

Nationalism has been a distinguishing character of Peronism, a political ideology and reality that the Pope never criticized and which some say he adheres to.

Navigating between his fondness for local cultures and identities and a global and universalistic (catholic) philosophy is a balancing act for Pope Francis.

I think he struggles with it.

Since the advent of nationalistic Peronism, his native Argentina got stuck in a road of social and economic decay and increased corruption.

Navigating between his fondness for local cultures and identities and a global and universalistic (catholic) philosophy is a balancing act for Pope Francis.

I think he struggles with it.

By not siding completely with either side, he becomes open to criticism from both my libertarian and conservative friends.

The former attack him for his nationalism, the latter for his globalist views.

To the economic liberals he says that “‘opening up to the world’ is an expression that has been co-opted by the economic and financial sector and is now used exclusively of openness to foreign interests or to the freedom of economic powers to invest without obstacles or complications in all countries.”

The Pope argues that that openness creates local conflicts and disregard for the common good, and that it is “exploited by the global economy in order to impose a single cultural model.”

Transnational economic powers “operate with the principle of ‘divide and conquer.’”

I sympathize with Pope Francis’s view that we have to go beyond numbers, or even “physics,” as he writes, to understand economic truth. Continue reading