Model for policymakers seen in encyclical’s focus on truth, justice
By Beth Griffin
Catholic News Service
UNITED NATIONS – Pope Benedict XVI’s encyclical Caritas in Veritate, while not intended to be a treatise on economics, offers a framework for solving the current financial crisis, according to panellists at a 10 March UN event.
The encyclical’s focus on truth, trust and social justice is a model for policymakers to consider, they said. Their presentations addressed globalisation in the context of the encyclical.
The event was sponsored by the Vatican’s UN mission and the Path to Peace Foundation and coincided with the 54th session of the UN Commission on the Status of Women.
“With this document,” said Archbishop Celestino Migliore, Papal Nuncio to the United Nations, “Pope Benedict writes to us not as a politician, or an expert in finance and economy, but as a man of faith trying to read the signs of the times in light of God’s wisdom; not to give out recipes and solutions, but to shed light on different human situations and help people make sense of and find hope and the necessary resilience to confront new situations and events.”
Joseph E Stiglitz said the crisis is taking a toll on people all over the world, but it “has a ‘Made in USA’ label on it.”
“We exported the deregulatory philosophy that created the crisis and allowed it to move quickly around the world,” he said, “but we also exported our toxic mortgages,” which were purchased largely by Europeans.
Stiglitz, a Nobel laureate, is a professor at Columbia University and Chair of the UN Commission of Experts on Reforms of the International Financial and Monetary System.
He said economist Adam Smith’s long-dominant philosophy that the pursuit of self-interest in the marketplace leads to economic efficiency and the well-being of society is not valid. Those who relied on it allowed governments to abrogate their responsibility to protect the vulnerable, he said.
Government and civil societies must play a role alongside the economic markets, he said. “Governments will not solve all the problems and can not stop all bad behaviours,” Stiglitz said, but they must enact simple rules to protect individuals.
Stiglitz said there were “aspects of moral depravity” in the conduct of some people in the financial sector who engaged in practices that were “unethical but not illegal.”
As an example, he cited predatory lending in the credit card market. He said banks that charge 30 per cent annual interest are abusive, violate religious dictums against usury and prey on poor people “because that’s where the profits are.”
The basic values of truth and honesty were ignored by the financial sector, leading to the undermining of trust throughout society, said Stiglitz. “The silver lining on the cloud of our crisis is it has brought about a re-examining of the way our society and economy functions,” he said.
Karen E Boroff, Dean of the Stillman School of Business at Catholic-run Seton Hall University in South Orange, New Jersey, said Caritas in Veritate inspires an honest search for the root causes of the financial crisis as a basis for a successful solution.
Assigning blame is not productive, she said. “An unfettered search of ‘what went wrong’ with a true zeal to find out the truth – the veritas – places us in the wisdom of the Pope’s encyclical,” she said.
Boroff said the most resonant element in Caritas in Veritate (“Charity in Truth”) is that “without truth, without trust and love for what is true, there is no social conscience and responsibility, and social action ends up serving private interests and the logic of power, resulting in social fragmentation, especially in a globalised society at difficult times like the present.”
She said just and moral people search for truth and not expedient answers and should be more earnest in probing “what has given rise to the economic crisis.”
“If we hope to have any economy operate with distributive and social justice,” Boroff said, “it has to have honest people at every juncture, and not just those at the top.”
She said the encyclical promotes the principle of subsidiarity – “that matters should be handled by the lowest level of competent people, because that fosters efficiency, effectiveness and, in the Pope’s words, is well-suited to manage globalisation and directing it toward authentic human development”.
Subsidiarity was violated when people distanced themselves from the financial instruments they created and relied on mathematical models that offered a false sense of security, she said.