00 7/7/2009 5:30 AM

An economic consultant talks
about the 'social encyclical'

Translated from

July 1, 2009

"The Pope had to update the encyclical to reflect the world crisis".

Two of the persons who had most contributed to the material for the Pope's third encyclical Caritas in veritatesaid that was the primary reason for the delays, corrections and adjustments made to the text.

"The draft was almost in final form nine months ago," said the economist Stefano Zamagni, professor of political economy and consultant to the Pontifical Council for Justice and Peace, "and just when it was ready to go to press, came the bank failures in the United States. Om September 15, 2008, when Lehman Brothers collapsed, the Pope decided that it was not possible to have a document that did not take these developments into account. In juridical terms, the Pontiff wanted a 'supplemental investigation' that would adequately reflect the global financial meltdown."

"It could not have been otherwise," Zamagni adds, "because the premise for the encyclical was globalization, which is tightly linked to the crisis we now have".

As for other economic influences on the text, Zamagni clarified the 'inspiration' attributed to Giulio Tremonti by the media.
[Tremonti is the current Italian minister for economy and finance, a staunch political and economic federalist who is an opponent of globalization and an advocate of tax cuts to stimulate the economy. He has written several books on taxation and international commerce.]

"The Tremontian term 'mercatismo' [which Tremonti uses to refer to the 'free market ideology'] does not appear in the encyclical," Zamagni says, "insofar as it is synonymous to an anarchic free market".

He said the various experts consulted had differing opinions on the optimal post-crisis position. "Some wanted the encyclical to hew closely to the crisis, but I argued against it, since three years from now, after the storm has passed, it will be water under the bridge. So it would not pay for an encyclical that will be read for decades to be so tightly bound to one episode."

Thus, he said, in the encyclical, "the crisis is cited as a remarkable example of greed raised to a moral system, but there is no specific chapter on the crisis - rather, it turns up as a recurring example for certain points." In all, he says, the pages referring to the crisis are no more than 2% of the total.

"In some passages, the crisis provides the background and paradigm for the argumentation, as when it points out that if the market economy loses its orientation for the common good. then it degenerates and leads to unemployment and neo-colonial conditions. In these and similar scenarios, the crisis proves and reinforces the basic assumptions of the encyclical."

Zamagni adds that "there is an ample paragraph devoted to the structural problem of environmental damage".

He acknowledges that most people are interested in whatever 'concrete proposals' the encyclical makes. He says that for the first time, the idea of 'non-profit' turns up in a social encyclical, and that there is open praise for the February 19 unanimous adoption by the European Parliament of a pluralistic concept of the social economy as one that can take many forms, not merely capitalist".

The encyclical, he says, is more favorable to the Italian notion of a 'civilian economy' against the Anglo-Saxon concept of a political economy - since the former "adds the principle of reciprocity to the economic discourse, alongside the classic principles of exchange and redistribution."

Thus, he said, "donations that have economic value should factor into businesses, families and organizations" and "instead of being reduced to a commodity, the person as worker must be central, and if he does not do what he is supposed to do, he must be corrected as one disciplines a child so that he may learn and grow from his error."

Also speaking about the encyclical was Cardinal Renato Raffaele Martino, president of the Pontifical Council for Justice and Peace, which is the Vatican agency sectorally responsible for contributing to the draft.

"There were a number of changes made starting last March in order to take the current crisis into account," he said. He met with the Pope on May 19 to discuss the changes.

Further adjustments were made to the propositive parts, he said, "but more than practical solutions, the text focuses on underscoring the fundamental principles of the Church's social doctrine."

"In other words," says the cardinal, "there are concrete references to economic realities, but it urges solutions that would promote global peace, human rights, subsidiarity, globalized humanism of labor, and commitment to charity."

I am counting on the Holy Father to provide us with an encyclical that will be as pleasurably readable as the first two ones! Social doctrine and economic abstractions are usually soporific and rather mind-numbing to slog through, in any form, like the 'preview' given above which, of course, reflects nothing of the Pope's expository style and language....