Left-wing politicians are not alone in disliking capitalism for liberating the poor from their franchise on gloom and doom. Some religious leaders also dislike capitalism because they fear that it alienates the poor from their charities.
The charities’ attitude against capitalism is often based on an apparently solid ground. Namely, on the immorality of wealth and the charge that profit-seeking merchants abuse their power of influence to promote inappropriate patterns of consumption among the poor and vulnerable, be it booze, junk food or tobacco.
An illustrative episode on this rash analysis took place recently in Portugal, when a group of Catholics signed a manifest against the award by the Catholic University of the prize “Faith and Freedom” to a well-known capitalist - Soares dos Santos. We will use it to illustrate the issue.
Soares dos Santos is an outspoken and successful Portuguese retailer who recently came under strong criticism for causing a public run into his stores by offering a 50% rebate on all purchases made on labor day (the 1st of May). The Trade Unions were outraged when workers went shopping rather than attend their rallies.
The Union’s reaction was understandable, but the reaction of the protesting Catholics was centered on the grounds that: “he had amassed his colossal personal fortune, through capital gains and accumulation, labor exploitation, and tax dodging” in an economy that “kills, through poverty, massive unemployment, increasing inequality and serious environmental risks”.
This was clearly a mashup between Marxism and the Gospels maxim that: “blessed are the poor in spirit, for theirs is the kingdom of heaven” and that “it is easier for a camel to go through the eye of a needle than for someone who is rich to enter the kingdom of God”.
In fact, Soares dos Santos business success resulted from a strategy of deploying mid-sized supermarkets offering a choice, price and quality somewhere between the local shop and the large supermarket and had nothing to do with business malpractices. So, were his critics simply committing the deadly sin of envy or something else?
They were adopting a puritanical ideal that views wealth as an obstacle or offense to the Christian faith, the ideals of corporatism or the theology of liberation. Whatever the religious movement it is clear that the Church has always been reluctant to accept the liberating role of capitalism. Good Christians practice charity as a way of personal redemption and favor before God and not to eradicate poverty.
To some extent religious charities face the same problem as governmental agencies. If they eradicated poverty they would end up without a job. So, maybe unconsciously, they are more prone to accept economic systems that cause misery (like socialism) than to endorse the most successful system to reduce poverty (capitalism).
For instance, Pope Francis in his Apostolic Exhortation recovered the old criticism of capitalism that “Some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world”. Then he wrote that: “This opinion, which has never been confirmed by the facts, expresses a crude and naive trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system.”
Others, like Theos, a London-based religious think-tank, took a more friendly stance in their document: "Just Money: How Catholic Social Teaching can Redeem Capitalism".
Although advocates of capitalism do not see a need for redemption, one should consider whether the policies advocated to correct the excesses of market fundamentalism are market perfecting or another remake of social democratic policies for a managed capitalism.
In this regard, the document is vague and mixed. It takes its inspiration from the 1892 Rerum Novarum encyclical, which inspired corporatism, as well as on John Paul’s Centesimus Annus of 1991 and the 2013 exhortation Evangelii Gaudium of Pope Francis, which are critical of capitalism.
The proposed Blueprint for a Better Business based on Catholic Social Teaching offered the following five principles for an ethically based business: 1) a good business is honest and fair with customers and suppliers; 2) good business is a good citizen, in that it considers each person affected by its decisions; 3) has a purpose which delivers long-term sustainable performance, operates true to a purpose that serves society, respects the dignity of people; 4) has to be a responsible and responsive employer; and 5) is a guardian for future generations, because it honours its duty to protect the natural world and conserve finite resources, contributes knowledge and experience to promote better regulation to the benefit of society as a whole.
However, with the possible exception of principle five on externalities, ever since Adam Smith’s Wealth of Nations, all these principles have been shown to be better achieved through market competition rather than moral preaching.
To conclude, the Catholic Church has a legitimate part in calling for a greater role of the voluntary sector in capitalist economies, but these platitudes on business ethics add nothing to market perfecting policies and open a wide door for all kinds of wishful thinking aimed at diluting the fundamental principles of capitalism. Therefore, the Church is doing a disservice to its members by confusing reasonable concerns about the limitations of capitalism with a wide system failure.