Acton Commentary

Can the Rich West Help the Third World?


Catholic social teaching endorses the core institutions of free societies, in broad outlines. The Church endorses the right to private property, to voluntary association, to entrepreneurship, and even to profit. This is not a blanket endorsement of each and every market-based economy, since these basic building blocks can be abused or misused. At the same time, each society must work out the details that are suitable to its own situation.

For example, the Church's teaching that enjoins employers to pay a living wage does not attempt to specify the wage level for any particular time, place and circumstance. The Church understands that each local area will have different needs.

The Church had the opportunity to use her nuanced social teaching herself, in her comments about the meeting of the World Trade Organization (WTO) in Seattle last year. You may recall that this meeting burst onto the media radar screen when demonstrators and protestors disrupted downtown traffic and destroyed property. The demonstrators came from all over the left-wing map, making mutually contradictory demands about job security, labor standards, the environment, and poverty. President Clinton added to the confusion by saying that he sympathized with the protestors, even though he had endorsed a number of fast-track trade agreements.

Above all the cacophony, the Holy See's statement offered a clear and balanced analysis. In a statement written by non-economists, the Holy See showed more economic and political sophistication than many of the so-called experts. At the same time, the Vatican displayed its concern for the poor and marginalized in realistic and unsentimental terms.

The document begins by praising the earlier international trade agreements that allowed developing countries to adopt "policies of market liberalization," even while acknowledging that "poverty and marginalization have not been defeated." The Holy See fully realizes that trade alone is no panacea to the problems of extreme poverty. Nonetheless, the document points out that the Less Developed Countries (LDCs) actually have a smaller share of international trade than in 1990. Therefore, "further efforts are needed to ensure that all partners have the opportunity to benefit from open markets, and the free flow of goods, services and capital." Echoing the concerns Pope John Paul II expressed in Centesimus Annus, the Holy See's intervention to the WTO continues: "The poor ask for the right to share in enjoying material goods and to make good use of their capacity to work, thus creating a world that is more just and prosperous for all."

In other words, the first priority for alleviating poverty is to bring poorer countries into the circle of productive market exchange.

The Holy See suggests several ways to increase the participation of poorer countries in the world trading system. Poor countries often lack the skilled personnel necessary to comprehend and comply with the complex world trade regulations already in place. Often the countries do not have the legal expertise to use the mechanisms for resolving the many disputes that inevitably arise under a complex set of trading rules. The rich countries need to give technical assistance to lower these implicit barriers.

But the demonstrators in Seattle were not especially focused on economic development for poor countries. Many of the demonstrators were profoundly afraid that increasing economic activity in poor countries would harm their interests. Labor unions fear competition from workers in poor, low-wage countries. Environmentalists fear that hard-won environmental regulations in rich countries would be undermined by increased participation of the poor in the world economy.

The Holy See mentioned these concerns toward the end of its statement. "There are some sensitive questions concerning developed countries, as well as middle income and poor countries, such as human right, labor questions, environmental degradation, biotechnology and health, which, notwithstanding their links with trade, will have their full solution beyond the confines of WTO. All of these need to be handled in a spirit of prudence and cooperation, while seeking a broad and long term consensus on the basics of human sustainable development." But the Vatican cut to the heart of the matter in a terse statement: "rich countries need to avoid any kind of protectionism in the guise of (these) principles."

The rich countries have the power to cut the poor countries out of the circle of production and exchange by imposing First World labor and environmental regulations on Third World countries. Taking that course would consign the poor countries to permanent underclass status. "Prudence and cooperation" in such a context would mean handouts from rich countries to governments of poor countries, a policy that has already failed.

We in the wealthy West take our advantages for granted. When people are living at the barest level of survival, environmental quality and working standards are not, and should not be, the highest priority. When living standards rise, people have the wealth and the breathing space to begin to demand environmental protection, each country in its own time, and in its own way. The Vatican's statement reflects its desire that the poor countries have the opportunity to develop economically. Only then, will poor countries have the luxury of making these decisions for themselves.

This article originally appeared in the April 23-29, 2000, issue of the National Catholic Register. Adapted and reprinted with permission.