Vatican Statement on Economics
This quotation from Paul VI’s encyclical Populorum Progressio
prefaced the recent release of an extraordinary document in
Rome. Authored by the Vatican’s Pontifical Council for Justice
and Peace it’s a breath-taking analysis of the moral failing
behind the current economic crisis. Even more—signed by
the Council’s head, Cardinal Peter Turkson, and by its secretary,
Bishop Mario Toso—the document charts what might
be called a “Catholic way forward” from the present morass.
The analysis of the intrinsic moral failing of modern economic
life is particularly compelling. For while the authors
detail how the economic crisis of our day “has revealed behaviours like selfishness, collective greed and the hoarding of goods on a great scale,” it is not the greedy sinfulness of individuals that is emphasized. Instead, analysis here focuses on
certain structural aspects of contemporary civilization that have
abetted and facilitated such greed. Greed no doubt is an endemic temptation for our fallen nature, as it were, but special failings of current institutions, practices, and ideology
corrupt the process of human formation in a fundamental way.
What practices and ideologies are to blame? “First and foremost,” we’re told is “an economic liberalism that spurns rules and controls,” an “approach unsympathetic towards public intervention in the market.” The European terminology might confuse American readers (who’d likely call such ideology “conservative,” not “liberal”). But, this is what Blessed John Paul II once called the idolatry of the market, which is described in Monday’s release as a “system of thought, a form of ‘economic apriorism’ that purports to derive laws for how markets function from theory, these being laws of capitalistic development.”
Such thinking is neither radical nor new. Radical as it might
seem to Americans, this analysis from the Pontifical Council
fits comfortably within magisterial traditions. From the 19th
century onward encyclicals and other Church teachings—including the writings of Blessed John Paul II and Benedict XVI have preached that unregulated market forces endanger the
common good. Valuable as they are for economic development,
without moral safeguards markets are perceived to foment attitudes toward others and toward the community that not only oppose Christian values but also are unsustainable for an enduring and just social and political order. Market operations incline us to valorize the self and self-interests and to do so in opposition to and competition with others. In individual moral terms, the worry is selfishness, greed, and pride. We’re nudged by market forces, as the document puts it, to live like a wolf among our fellow men and women. Understood more broadly, the Church’s long-standing argument is that the unregulated
market’s “invisible hands” erode caritas and concern for others (especially concern for those Jesus called “the least of these”) and militate against the primary purpose of our public life as citizens which is the common good of the whole community in light of salvation.
The statement from Rome draws from the writings of Benedict XVI pointedly in making this case, noting that “In his social encyclical [Caritas in Veritate], Benedict XVI precisely identified the roots of a crisis that is not only economic and financial but above all moral in nature. In fact, as the Pontiff notes, to function correctly the economy needs ethics; and not just any kind but one that is people-centered. Being should have primacy
over having. Ethics should precede economics. Persons are
irreducible: they are not merely commodities, consumers, or
producers. Thus, a moral appreciation of the utter dignity of
the person, the solidarity of the human community, and concern
for others must be empowered in public life to guide
and regulate the dynamism of economic markets to support
the fullness of the Christian vision for the common good.
The economic miseries of our time trace to our generation’s
failure in this regard.
The Pontifical Council’s analysis is powerful, and it resonates poignantly within our world’s current atmosphere of frustration and despair over out-of-control economic forces that seem to be shredding the fabric of our lives and livelihoods. The remedies that the Council proposes are similarly appealing. Needed, we are told, are morally inspired laws, regulations, and institutions to guide market forces
toward the common good and to assure that markets serve
humankind rather than the reverse. Specifically, the Council advocates for a supra-national network of laws and an international authority to regulate globalized markets. No fantasizing about black IMF or United Nations helicopters hovering over Wall Street, however. In keeping with the principle of subsidiarity, the Council would empower such authority to intervene only where local and national efforts to regulate for the common good proved ineffective.
American Catholic conservatives are in a tizzy, naturally. “Rubbish, rubbish, rubbish,” George Weigel writes, shouting for all who’ll listen that the Pontifical Council does not speak with papal authority and not only can its teachings be ignored, but they should be. Samuel Greg of the Acton Institute (echoing the American Tea Party’s shrilling that wrongheaded intervention by the “authority” of the Federal Reserve
and the national government actually precipitated the crisis) complains that the Pontifical Council offers only “an uncritical assimilation of the views of many of the very same individuals and institutions that helped generate the world’s most serious economic crisis since the Great Depression.” As if anticipating such dismissals, Bishop Toso at the release
of the document in Rome reminded the assembled journalists that the Council took its inspiration from Benedict XVI himself who, in Caritas in Veritate, proposed that some form of world authority was needed in the present age to bring order to emerging global economic forces.
Cardinal Turkson came to Washington earlier this year where he delivered a powerful defense of Catholic Social Teaching at an event commemorating the 120th anniversary of Rerum Novarum, the seminal papal encyclical to confront issues of economic justice. He is hardly a radical. It is a measure of how distorted the American political landscape has become that his analysis sounds so fresh and so different from the norm in contemporary debates about the economy. In this new document, he invites all Catholics to look at the financial crisis as Catholics first and political partisans second. It is an invitation we should all accept.
Steve Schneck is the Director of the Institute for Policy Research
& Catholic Studies at The Catholic University of America.
He is a board member of Catholics in Alliance for the
Common Good. This article originally appeared in the Common
Good Forum at www.catholicsinalliance.org.
HIGHLIGHTS FROM THE VATICAN ECONOMIC STATEMENT
By Taylor Reese
PCUSA Program Associate
On October 24th, the Pontifical Council for Justice and Peace released a formidable economic analysis and proposal. Broadly speaking, this “note” draws on past Papal judgments upon the “idolatry of the market” (Bl. John Paul II), and an amoral “technocracy” (Benedict XVI), and builds on the idea of a “true world political authority” (John XXIII) via social principles of solidarity and subsidiarity, to foster full and global development, which is “the new name of peace” (Paul VI).
On inequality in development: “While some of the more industrialized and developed countries and economic zones…have seen their income grow considerably, other countries have in fact been excluded from the overall improvement of theeconomy and their situation has even worsened.”
On technocratic hegemony: “An economic system of thought that sets down a priori the laws of market functioning and economic development, without measuring them against reality, runs the risk of becoming an instrument subordinated to the interests of the countries that effectively enjoy a position of economic and financial advantage.”
On the dark outcome of unequal development: “No one can in conscience accept the development of some countries to the detriment of others. If no solutions are found to the various forms of injustice, the negative effects that will follow on the social, political and economic level will be destined to create a climate of growing hostility and even violence, and ultimately undermine the very foundations of democratic institutions, even the ones considered most solid.”
On the proposed economic authority: “Its decisions should not be the result of the more developed countries’ excessive power over the weaker countries. Instead, they should be made in the interest of all, not only to the advantage of some groups, whether they are formed by private lobbies or national governments.”
Full text of the statement can be found online at:
http://www.news.va/en/news/full-text-note-on-financial-reform-from-the-pontif
Santorum charity for the poor spent most of its money on management, political friends
By Carol D. Leonnig and Dan Eggen
As Republicans gathered for their national convention in Philadelphia a decade ago, Rick Santorum, who was then an up-and-coming senator from Pennsylvania, launched a charity he said would improve the lives of low-income residents in his home state.“Wouldn’t it be a great thing to leave something positive behind other than a bunch of parties and a bunch of garbage?” Santorum told a local reporter.
But homeless families and troubled children were not the biggest beneficiaries of “Operation Good Neighbor.” Instead, the foundation spent most of its money to run itself, including hundreds of thousands of dollars in fees for fundraising, administration and office rental paid to Santorum’s political allies.
The charity also had significant overlap with the senator’s campaigns and his work on Capitol Hill. Among the leading donors to the foundation were Pennsylvania development and finance firms that had donated to his election efforts and had interests that Santorum had supported in the Senate.
Santorum, whose last-minute surge in the Iowa caucuses has brought new attention to his presidential bid, portrays himself as a common man concerned about the gap between the nation’s rich and poor. But in the case of his charity, his efforts ended up mostly helping his cadre of political friends.
Before it folded in 2007, the foundation raised $2.58 million, with 39 percent of that donated directly to groups helping the needy. By industry standards, such philanthropic groups should be donating nearly twice that, from 75 to 85 percent of their funds.
“That’s exceptionally poor,” Ken Berger, president of Charity Navigator, a national organization that rates charitable groups, said of the group’s giving. “We would tell donors to run with fear from this organization.”
Santorum campaign adviser John Brabender said the former senator remains proud of the cause he championed.
“Senator Santorum was very committed to helping raise funds for Operation Good Neighbor and did so with the understanding that those funds would be used to help many organizations and families located in urban areas of Pennsylvania,” Brabender said.
Robert Pratter, who had served on the charity’s board, defended its management, saying its fundraising costs and payments to staff and consultants were reasonable.
“We were raising money for these very small mom and pop groups — the most effective way to raise money was the way we raised it,” said Pratter, who was formerly with Philadelphia risk management firm PMA Capital, a donor to the charity and to Santorum campaigns. “If you have a golf outing , it costs money to have a golf outing.”
Recipients, including an AIDS group, a local YMCA and others, received checks of roughly $6,000 to $15,000. Pratter said they were much-needed resources for tiny nonprofits struggling raise money on their own.
Robert Bickhart, a Republican political strategist who was Santorum’s campaign finance director, became the charity’s executive director.
He served without pay in 2001, and received payments for renting the charity office space in his Conshohocken consulting firm, Capitol Resource Group. Tax records do not specify the amount paid for rent.
Beginning in 2002, he was paid for his part-time job as director, and from 2002 to 2006 he received a total of $97,000 in compensation, plus unspecified amounts in office rent.
Bickhart, who became finance chair of the Republican National Committee in 2009, had resigned three years earlier from the Santorum charity. The group had been the subject of a piece in the magazine American Prospect that reported some of his early fees and noted the charity’s low level of giving to nonprofits.
When Bickhart left, Santorum’s former spokesperson, Laura Lebaudy, took over briefly as the charity’s director, records show.
In its six years, the charity also paid $347,088 for the fundraising services of Maria Diesel, a Chester County events coordinator who has also helped raise money for Santorum’s political efforts.
Diesel did not return messages left at her home. And Bickhart, who later became mired in controversy over his stewardship of the finances at the Republican National Committee under former chairman Michael Steele, referred questions to the Santorum campaign.
Pratter said Bickhart and others were properly compensated, and their political ties to Santorum were irrelevant.
“I don’t believe they got a tremendous amount of money, and I know whatever they got was for services provided,” Pratter said. “It wasn’t as if this was some kind of front. They did their work.”
Bickhart also benefitted from another Santorum organization, a political action committee known as America’s Foundation PAC, which the senator formed while he was in office. Lawmakers often use such committees, known as “leadership PACs,” to dole out money to political allies.
Santorum kept the committee going, even after losing his seat in 2006, and has raised $5.5 million over the past five years.
When he was in office and running for re-election, he gave 20 percent of the funds to other GOP candidates in federal races. But after Santorum left the Senate, that figure dropped to about 3 percent, although he also gave a small amount to local Republicans in key primary states.
The Campaign Legal Center, a nonpartisan watchdog group, found in a 2011 study that leadership PACs run by lawmakers commonly give away from 80 to 90 percent of their money to other candidates or political committees.
After he left the Senate, Santorum spent most of his PAC money — more than $3 million — on campaign-style expenses criticizing Democrats, including direct mail, polling and political consultants, disclosure records show. Another $1.4 million went for travel, salaries and other administrative costs.
As with the charity, hundreds of thousands of dollars of the PAC money went to loyal aides with close ties to Santorum. Bickhart and his firm, for example, have received nearly $780,000 from America’s Foundation since 2001, records show.
In a January 2010 letter seeking donations, Santorum said he needed money to “reinforce our conservative allies” in Congress and retake control of the House. Though Santorum had not then registered as a presidential candidate, he also wrote he was “actively considering” a presidential run and hoped to “kick the Obama administration to the curb,” according to the Philadelphia Daily News.
Santorum centered much of his fundraising and political organizing in recent years on opposition to the policies of President Obama and other Democrats. In one “thank you” mailing sent to supporters in 2010, Santorum said he was “fighting to preserve the very soul of America” and “to stop President Obama and his radical agenda.” The document is preserved on a vendor’s Web site as an example of award-winning fundraising work.
By 2011, much of the spending by America’s Foundation was centered on key primary states such as Iowa, New Hampshire and South Carolina as Santorum laid preparations for a presidential run.
Brabender said the expenses in primary states were proper.
“The senator spent a great deal of time on party building activities and helping other candidates, and he was entitled to have these expenses paid for,” he said.
Federal campaign-finance laws provide few limits on how a politician can spend money from a leadership PAC, and candidates are not required to form a presidential campaign committee until they explicitly declare an interest in running for the White House.
Santorum formally announced his bid in June 2011, after spending about $585,000 in the first six months of 2011 through America’s Foundation .
“Leadership PACs have become a very common vehicle to be treated as a kind of slush fund for former officeholders,” said Paul S. Ryan, associate counsel at the Campaign Legal Center. “It’s perfectly legal for a senator to amass millions of dollars in a leadership PAC, and then once they leave office or are kicked out office, they can do whatever they want with that money.”
Staff writer T.W. Farnum and Research Editors Alice Crites and Lucy Shackelford contributed to this report.
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