Is “the market” a dirty word? And is “the market” synonymous with capitalism?

This question is often raised but it is not discussed. It deserves analysis.

Markets and incentives, the ethics of production, discipline and organisation are necessary ingredients for the production of wealth. The innermost secret of “democratic capitalism” is the liberty exercised in the context of an unassailable reality: namely that any economic system must produce more than it invests, if it is not to stagnate. It must yield capital accumulation.

Profit is, therefore, a condition of development.

At the same time, it cannot be said that capitalism can be considered to be without blemish. A major blemish of “capitalist” institutions is the exclusion of a significant section of the population from the benefits of private ownership. This raises questions vital to the democratic process. These questions are central to our own Christian culture.

There is no reason why the attitude of the Church, and of the theologians of capitalism, should be one of uncritical endorsement. Within the context of Catholic social thought, there has been a legitimate tradition of criticism of capitalism. Even so, traditional Catholic social teaching recognises that man, as a social animal, needs a particular framework of social institutions if he is to flourish.

Among these institutions, just government is high on the list and, in all distinctively Catholic thought, the tasks of government are limited by the principles of subsidiary – the maxim that, what can be done by intermediary institutions, like the professional associations, charitable institutions and, above all, the family – ought not to be usurped by the State.

From Aquinas to Maritain, one finds a continuous thread of criticism about the cult of the omnipotent State. But Catholic thought does not fall into the libertarian trap of ascribing to the State only the minimal function of maintaining justice, enforcing contracts, and providing for the defence of the nation.

Vital role

Though restricted in its tasks, the government has a vital role in securing all the conditions of well being.

It may legitimately act as guardian of those moral traditions and practices, without which human life becomes meaningless and degraded. In the tradition of Catholic social thought, for example, private property has always been recognised as a condition of human freedom and dignity. At the same time, the entitlements of owners have been held in a balance with the claims of human needs.

Accordingly, in Aquinas, we find the affirmation that, where property rights in luxury goods come into competition with basic human needs, it is the latter that must prevail in terms of the common good.

The concept of the “social market” has evolved from this. It assigns to the State a measure of responsibility, in terms of its social obligations. While the market is to be given its head, and is expected to stimulate enterprise in order to create wealth, the common good imposes the obligation that the State supervises the observance of the “rules of the game” and sees to it that the weak and the needy get their fair share in any increase in wealth.

New ideas

Pope John Paul II elaborated on Catholic social teaching, his pronouncements being, no doubt, coloured by his experience and close contact with the excesses of Nazism and Communism.

His encyclicals Laborem Exercens and Solicitudo Rei Socialis (1987) broke new ground, not altogether free from controversy. He held that the Church’s social doctrine was not a “third way” between socialism and Marxist collectivism. The Pope affirmed that the main purpose of Christian social doctrine is moral theology, not political theory. The blending of his personal philosophy with the traditional perspectives of Catholic social thought was a characteristic of Pope John Paul who never restrained his thoughts when it came to the dignity of man and his essential freedoms.

In the encyclical Laborem Exercens Pope John Paul advanced new ideas. He distinguished between “early 19th century capitalism” of “rigid capitalism” and modern capitalism. He drew from broad experience the lesson that the socialist collectivisation of property takes from one class to give power to a new class. He identifies as “labour” many sources of creativity – the work of inventors, intellectual workers, management experts and the like, which go far beyond manual work.

These were giant steps in the tradition of John Locke and Adam Smith, even though the Pope was prompt to criticise abuses and errors in the capitalist system.

It is deplorable that little, if anything, has been done in these islands to promote, on a businesslike basis, the study of social teaching among the laity. This has created a vacuum, which is, perhaps, the cause of confusion as well as progressive ignorance.

Popular misconception

The growing popular misconception that competition has an ugly face highlights one such area of ignorance. It is a tenet of Christian faith that all men are equal, born in the image of God. They are entitled to their dignity and freedom as their birthright. This is where equality stops, and where differentiation starts to impose itself as a reality.

It is not a question of some being more intelligent or less, shorter or taller than others, leaner or more obese. At the very core of Christian teaching there is the assumption that God is not committed to equality of results.

Not all give a satisfactory account of their stewardship. The “prodigal” son receives a far more generous treatment when he returns home than the son who is faithful to the father. Workers who report for work at the 11th hour receive the same wage as those who toil all day. St Paul bids us to measure ourselves by his standards and to outdo them. The levelling of the collective smes to be out of place, because all are not equal in this context.

Our “pilgrim’s progress” implies a sort of journey, a struggle against the evil within and the evil that surrounds us.

Spirit of progress

Some who receive many talents may squander them or may be lazy enough to bury them. Those who use their talents fruitfully, and therefore profitably, will be rewarded.

In this context, the importance of human responsibility stands out against the background of such inequalities.

“Many who are now last will be first, and many who are now first will be last”(Mt.20.16). It is emphasised in the same scriptural passage that “many are called, few are chosen”. The implication is that Christian soldiers must forever strive onwards, inspired to competition with the heroic saints of yesteryear, and in daily combat with evil. Competition is relentless. It is, in a sense, the natural obligation of a free person, striving to measure oneself by high ideals under God’s judgement.

It does not seem to be inconsistent with Christian teaching for each human being to struggle, spurred to compete, in order to fulfil his potential. Indeed, this sentiment is pre-Christian. Competition was vital among the Greeks, as it is among all people endowed with creativity and a will to better themselves. The desire to do better is the soul of the spirit of progress. It is a non-competitive world that relishes the status quo

Critics of the market system claim that competition opens the way for greed and avarice, and for multiple abuses by unscrupulous “capitalists”.

It is true that, on Judgement Day, the rich may find it hard “to enter into the Kingdom of Heaven”, with as much difficulty as a camel passing through the eye of a needle. But it is equally true that, among the things for which humans compete, money is neutral and may be used in wise or foolish stewardship. Its possessors may use it for a wide range of choices. Those who are not careful stewards, who use it foolishly and risk losing it, cannot be compared with others, who invest soundly and well, and produce more for the benefit of their families and their fellow citizens.

Real root of evil

So, although human liberty can lend itself for good or evil ends, it is not illogical to hold that the root of evil does not lie in competition and the market system, but in ourselves.

The issue to be addressed is not the market and the principle of competition, but that of responsibility and probity of entrepreneurs.

The solution is not to throw away the apple, but to do everything possible to prevent the work entering into the apple to start the rot.

The competitive social market system, which is essentially a system of liberty, does not repress sin, but it fragments and seeks to check power.

One could visualise a market system that would suppress public vice. Freedom ceases as soon coercion makes its presence. The constructive alternative is to reinforce confidence in human decency and to shore up the “moral majority” that militates against decadence, and in favour of the rule of law.

Men of good will have grappled with the problem of how to unleash human creativity and productivity in a sea polluted by human sinfulness. Some argue that the answer is to appeal to social solidarity and high moral ideals. Others hold that greater incentives will fuel greater economic activism.

There are those who hold that, under the market system, the rich get richer and the poor poorer, implying that the plight of the poor is attributable to the wealth of the wealthy. This fallacious argument has been the subject of endless debate.

The condition of the common man has improved whenever the market system unleashed the forces of economic activism. The broader stimulation of such activism, the greater the wealth created.

This does not imply that all economic activists are equal in talent, luck, output or judgement. Nor does it mean that there are always equal results. But, whether on the part of the few or the many, whether it is in Europe or Southeast Asia, economic activism benefits entrepreneurs, as well as the communities in which they operate.

The market system is designed to be reformed and transformed and, of all known and proven systems, it alone seems to have the potential for transformation by peaceful means.

To come back to the main argument, God did not make creation coercive, but designed it as an area of liberty and creativity responsibly exercised, in a fair competitive atmosphere.

Readers interested in going deeper into this subject would do well to read Michael Novak’s absorbing treatise on The Spirit of Democratic Capitalism to which acknowledgement is due.

This book ought to be required reading in any university where the search for truth is conducted in a post-Marxist environment.

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