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Markets and Virtue

R&L: Please explore with us the way in which certain human virtues were compromised by the years of Communist rule in your country.

Klaus: Basic human virtues such as thrift, honesty, and fidelity can grow and flourish only in an environment of individual freedom and self-responsibility. Communist totalitarianism deprived people of both of them, made them more passive, more cowardly, and more resigned than in countries with political pluralism, property rights, and market structures.

R&L: In the long term, do you believe that the market system will encourage a resurgence of these virtues?

Klaus: People always pursue their self-interest, no matter what system they live in. Only ways and methods differ. Market systems, I am sure, encourage people in pursuing their self-interest to follow such ways that require and strengthen human virtue more than human vice.

R&L: In what ways would the lack of these virtues undermine the market process in your country?

Klaus: I don’t think that lack of virtues can undermine the market process in our country. If there is something that can undermine it, it is the residual belief of some people that there is some third way between capitalism and socialism. The virtues you are speaking about are not preconditions of the market system, but rather on the contrary–only a utopian, non-market system can exist without them.

R&L: Much attention has been given to the economic reforms in former Communist countries. Are these being overemphasized, at the expense, perhaps, of political reforms? How has the bureaucracy changed from the communist model?

Klaus: I don’t think we overemphasize economic reforms. The reason these are most intensively discussed is that they are most difficult to implement and cope with–take the privatization process, for example.

I also don’t think that bureaucracy has changed or that we try to change it. It will never change. What we must do, however, is to take the power of making decisions from the hands of bureaucrats and put it into the hands of private individuals.

R&L: Could you define a balance between the need to purge negative influences from the government with the all-too-human desire for vengeance?

Klaus: We already have legislation that deals with this delicate problem. We don’t allow any general attack on former members of the Communist Party. On the other hand, we don’t allow former prominent Communist Party officials or collaborators of former secret police to retain positions in state administration, legislation, or universities.

R&L: Two times in the encyclical letter of John Paul II, Centesimus Annus, the Pope calls for a “stable currency.” Could you reflect on the consequences of inflation on the moral habits of constancy and probity? In addition to the economic impact of inflation, please outline your moral and social concerns.

Klaus: Inflation, by eroding the purchasing power of money and thus the trust of people in this crucial socio-economic institution erodes the virtue of thrift, ignites social conflicts arising from redistributional consequences of inflation, and thus endangers prosperity of the whole economy and the basic stability of a society.

R&L: The universities in your country have undergone some restructuring, with much of the authority given to tenured faculty who are still Communist Party members. How can you educate a new generation in the tenets of liberty in this atmosphere? To what extent can market forces be used to reinstate education in your country? To what extent would you see religious institutions involved in this process?

Klaus: The fundamental change in our universities is that the state no longer supervises what lecturers teach. There is a fruitful environment of liberty at our universities now. Some prominent dogmatics who lost their privileges in the new system and proved unable to teach left universities simply because students did not attend their lectures.

The government does not want to test university professors. By creating an environment of freedom to choose, we set up a spontaneous process of “natural choice” at the universities. Religious institutions can bring some fresh ideas and new attitudes which were not present here, at least in our educational system, for a long time.

R&L: The Judeo-Christian ethic places a high value on personal responsibility, especially with regard to one’s family. How have the years of Communist rule in your country affected the attitude of individuals toward personal responsibility? Toward the family? How can the church address this issue?

Klaus: Long years of Communist rule have undoubtedly undermined individual responsibility, in all respects, including the one you mentioned, because people got used to being cared for by the state. Of course, people felt responsible for their families, but the scope of opportunities had been severely limited and had a very negative impact on their morale. But the world is not, and never has been, black-and-white, and we have to stress that there are many other reasons for losing personal responsibility than the existence of a Communist rule.