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John Paul II’s Use of the Term Neo-Liberalism in Ecclesia in America Based on a paper delivered at the Pontifical College Josephinum April 8, 2000 Abstract
1. Introduction With the 1999 promulgation of Pope John Paul II’s apostolic exhortation, Ecclesia in America, another wave of academic discourse has come about in an effort to clarify the Church’s position on the free economy. The catalyst for this renewed inquiry is article fifty-six of Ecclesia in America, which concerns the emergence of neo-liberalism. My reflection on this issue has been prompted by John Paul II’s rather severe condemnation of neo-liberalism under the heading of “Sins Which Cry to Heaven.” John Paul II describes neo-liberalism as follows:
As a cultural phenomena that has marginalized a large portion of America’s population, the economic consequences of neo-liberalism leave many to feel as though they are being subjected to a new form of western colonialism. One of the more telling examples of neo-liberalism’s negative effect is the poor labor conditions within many Latin American countries. While these economic conditions can be attributed to multiple causes such as government corruption, a lack of democratic institutions, and the undermining of personal liberties within these developing nations 2, the temptation for many Catholics has been to lay the blame for these conditions exclusively at the feet of the free economy and economic globalization. Thus, the pope’s condemnation of neo-liberalism translates unequivocally for them as a condemnation of the free economy. Herein lies the problem. With this line of reasoning, it would appear that the pope is suggesting that the free economy and Catholic Social teaching are ultimately irreconcilable. However, this conflation of neo-liberalism and the free economy reflects a significant misunderstanding of the pope’s use of the term “neo-liberalism. 3 “ I would like to state at the outset that the pope’s condemnation of neo-liberalism does not, as one could infer, constitute a wholesale condemnation of the free economy. Rather, I would suggest that he is specifically condemning a philosophical error I will later describe as economic reductionism. This is a worldview held by certain free-market economists who believe man’s social existence should be understood primarily in terms of economic considerations. This system of belief has led many to approach the market as though moral norms have no bearing upon market activity. In other words, an unfettered market itself, it is believed, will take care of the social problems we face. However, Catholics need to grasp the distinction the Church makes between the free economy and neo-liberalism. This distinction is one of great import insofar as it distinguishes between a morally viable and important economic system in the first case and an immoral philosophical world-view in the second. Certainly these two realities can be related, but they are not necessarily so. In other words, neo-liberalism is not the inevitable outcome of the free-market system; it is only one possible outcome, depending on the moral disposition of the actors within the market. The Church, in as much as it values the fundamental principles of the free economy, understands this, and thus attempts through its social teaching to encourage the international community to place what it would prefer to call the “business economy” at the service of human dignity 4. So that I might provide an adequate justification for my interpretation of the pope’s use of the term “neo-liberalism,” I need to address two key questions. First, what is liberalism in the traditional sense of the word. And, second, how, within the Church’s social teaching, is liberalism to be distinguished from neo-liberalism? I. Liberalism and Neo-Liberalism Liberalism is a political philosophy that has its intellectual roots in Renaissance humanism; but it gained considerable momentum as a cultural movement after the Reformation 5. In an effort to challenge the social presuppositions of medieval Europe, liberal thinkers maintained that each human being is a repository of certain God-ordained, inalienable rights that ought to be safeguarded 6. Among these are the right to private property, religious liberty, and political participation 7. Although the specific political and economic theories that were formulated to defend these rights often varied from one thinker to the next, these political philosophers of the Enlightenment formed a school of thought known as liberalism 8. In general, individual liberty, limited government, and the rule of law characterized the liberal vision. Today this school of thought is known as classical liberalism 9. It is crucial to understand the historical development of classical liberalism in order to interpret the exact meaning of John Paul II’s use of the term neo-liberalism. Classical liberals advanced many ideas concerning the social order that, in effect, provided a catalyst for the Church to develop her own social teaching 10. One of the fruits of this social teaching has been the Church’s understanding of genuine human freedom as it stands in contrast to the idea of moral autonomy and atomistic individualism, which was popularized by nineteenth-century liberalism. Standing behind the pope’s use of the term neo-liberalism is over one hundred years of Church reflection on the question, How ought genuine human liberty be understood in its various manifestations 11? Though the Church has more or less condemned the philosophical foundation of liberalism’s understanding of freedom, she has not rejected every tenet of the liberal vision 12. Thus, the explicit condemnation by Pope John Paul II of neo-liberalism does not constitute a wholesale condemnation of the free economy, but rather, a condemnation of those elements of economic liberalism that are incompatible with Catholic social teaching. However, many of the economic insights advanced by classical liberals, such as the importance of profits, free markets, private property, economic initiative, and the rule of law, have been defended by the Church’s social thought 13. II. Human Freedom: Must Liberalism and Christianity Part Ways? To get at the core of liberalism and the Church’s teaching about it, one must first understand the somewhat divergent emphasis each view places on the definition of freedom. From a Christian perspective, liberty is generally understood as freedom for something—freedom for the fullness of truth and the integrated life of virtue, which finds its greatest fulfillment in Christian discipleship 14. This kind of freedom pertains to one’s duties, as a citizen, toward God and others 15. Christian freedom is an interior freedom from the bondage of sin, and therefore does not depend upon political, economic, or religious liberty as such. In fact, this particular notion of freedom—informed as it is by the life of Christ—has often been realized most authentically under the yoke of persecution. Consequently, Christian freedom is inextricably bound up with the humble submission of one’s will to God’s providence 16. This is generally referred to as positive freedom. For the classical liberal, liberty is generally freedom from something—freedom from the coercive actions of others and from the limitations of social caste 17. Freedom understood in this way is the civil safeguard of each person’s dignity. This kind of freedom pertains to one’s right, as a citizen, to pursue one’s own happiness free of interference by others. Therefore, this notion of freedom requires political, religious, and economic liberty. Such liberty excludes persecution of any kind and requires its permanent elimination through a doctrine of civil tolerance 18. The classical liberal definition of freedom, then, asserts the primacy and autonomy of the will in relation to the illegitimate coercion of other human beings. This is generally referred to as negative freedom. The difference between positive freedom and negative freedom can be quite substantial, at times, depending upon the degree to which one is emphasized to the exclusion of the other. However, these differences need not be mutually exclusive, nor are they necessarily incompatible as some might be inclined to think. In fact, I would suggest that the flourishing of human culture is best achieved by the integration of these two notions of freedom. Why? Because, as a result of man’s fallen nature, the essence of liberty, properly instantiated in the social order, cannot be exclusively one or the other, but rather a balanced synthesis of both. Thus, as Christians, we cannot reasonably embrace a culture that advances liberty at the expense of truth, nor can we embrace a society that advances truth at the expense of liberty. I believe that an incarnational principle underlies this proposition. On the one hand, revelation has given us a more transcendent object for human freedom, a freedom that can be achieved only by the power of the Holy Spirit. This kind of freedom ultimately depends upon sanctifying grace. On the other hand, liberals have helped the modern world clarify the social implications of positive freedom—that is, the right to equal protection under the law from unjust coercion. The liberal notion of freedom, then, is rather mundane in that it pertains to the temporal order and is achieved by upholding the rule of law. As St. Thomas so eloquently argued in the Summa that grace builds upon nature to perfect nature, so, too, could one argue that positive freedom builds upon negative freedom to perfect culture. Perhaps it would be more accurate to state that positive freedom informs negative freedom, thus elevating the social order to a higher state of perfection—in so far as it would then be rooted in man’s ultimate destiny. Thus, when both aspects of freedom work together, there are both transcendent and temporal elements that come to form what I believe is an essential foundation for the flourishing of culture. An argument can be made that the culture of life—as Pope John Paul II refers to it—requires an integration of these two elements. The culture of life is ordered to the dignity of man who, in being created in the image of God, is a creature constituted in freedom 19. Therefore, authentic human culture can flourish only when individuals are externally free to pursue the moral good with the greatest opportunity for its outwardly social expression. Certainly, a persecuted individual can, by the grace of Christ, achieve the interior freedom of virtue, but for him or her, that freedom can find little or, at times, no social realization. Thus, as far as the social order is concerned, Christians cannot deny the indispensability of negative freedom if the social order is to allow for the greatest realization of human potential. However, negative freedom cannot be divorced from the truth of who man is. In his encyclical letter, Centesimus Annus, John Paul II offers his reflections on this matter. He states:
The pope’s insight that authentic culture presupposes genuine liberty in all its dimensions is important. A proper understanding of freedom is the necessary precondition for authentic culture to develop. When man is enslaved either morally or socially, he lacks the ability to realize adequately his full potential, that is, the many possibilities for doing good that exist within the horizon of his social existence. Since man naturally yearns to discover the meaning of his existence in and through his relation to others, he suffers if he is not free to do so. The cultural drama of the Americas, as it is presented in Ecclesia in America, has dramatized for us how the struggle for genuine human liberation—as far as the social order is concerned—cannot be realized without the integration of both the sublime and mundane aspects of freedom. What has prolonged this struggle has been the failure of many to reflect upon the social imperative to integrate these two notions of freedom that arise from human dignity. Nonetheless, the debate over the degree of compatibility between Christianity and liberalism continues, especially among Catholics. Some maintain that the Christian faith is at complete odds with liberalism, and therefore no tenet of liberalism can ever be embraced. David Schindler of the John Paul II Institute, for instance, states in his book, Heart of the World, Center of the Church,
In contrast, others believe that since the Church offers only a critique of liberalism, such a critique does not exclude the possibility for synthesizing many elements of liberalism with Catholic social thought as long as the accepted tenets do not contradict Christian moral principles. The argument with these individuals is not that liberalism provides a substitute for the content of the Gospel, but that liberalism has provided a useful social context or framework within which the Gospel can be advanced in a manner that respects the dignity of persons. Fr. Richard John Neuhaus is of this opinion as evidenced by his May 1997 article in First Things, “The Liberalism of John Paul II”:
III. Liberalism’s Recapitulation within Catholic Social Thought Over the past one hundred years, liberalism has, in fact, been reoriented and sufficiently nuanced by the advent of Catholic social teaching. As I stated earlier, the use of the term neo-liberalism seems to suggest this inasmuch as it refers only to those elements of liberalism that the Church rejects, but not to liberalism in its totality. Grasping the Church’s teaching on this matter, however, requires both a clear understanding of liberalism’s merits, and a clear definition of Church teaching on liberalism—one that is situated within a proper historical context. The intellectual merit of liberalism can be best appreciated in terms of its political theory of rights, and its attempt to forge a social theory aimed at establishing the equality of all men before the law. In this theory of rights can be found an attempt by liberals to respond to the political, religious, economic, and civil contours of their historical circumstances, which were rife with conflict. In other words, given the social tensions of the age, especially in terms of the political environment, the rise of liberalism is not difficult to understand. While it is true that certain liberal excesses have historically contributed to various revolutions, anti-clericalism, the rejection of legitimate authority, and other such tragedies, the liberal movement, in its inception, was an honest attempt to bring an end to the social strife that plagued Europe after the Reformation. Liberals intended to help resolve the social intolerance that was quite literally tearing Europe to pieces. To their way of thinking, the success of such an endeavor lay in establishing a culture founded upon the idea of civil liberty secured by a doctrine of political pluralism, devoid of troublesome and divisive religious content. Classical liberals desired to forge a cultural milieu that was characterized by civil liberty and respect for individual human rights over and against the social mores of the feudal system 23. However, liberalism gained little, if any merit in terms of its historic manifestations, or the philosophical framework within which these theories were worked out. Hence, by the end of the French Revolution, liberal ideals had been thoroughly subverted for revolutionary purposes and the promotion of moral license on the part of secular humanists—especially on the European continent 24. These deviancies betrayed the original liberal agenda because they lacked practical continuity with the essential principles of liberalism. Ironically, the French Revolution, which has been touted as the “liberal” revolution, was the epitome of religious intolerance. Even more ironic is the fact that the Church herself—most especially through the development of her social doctrine—has become the most articulate proponent of religious liberty 25. I would suggest that the Church has elevated certain elements of the classical liberal agenda—and without compromise—by divorcing liberalism from its historic excesses. By situating liberalism within a Christian philosophical and theological framework, the Church has sufficiently anchored liberalism’s vision of individual liberty and human rights in a proper anthropology. This process began with Pius IX’s 1864 Syllabus of Errors, which condemned the radical elements of the liberal movement, and has continued all the way through John Paul II’s encyclical letter, Fides et Ratio. By asserting this, however, I am also recognizing that the Church has condemned the excesses and abuses of liberalism. Among these would be the errors of atomistic individualism, the absolute right to private property, the idea that law originates from the will of the people, and the rejection of legitimate authority, especially the moral authority of the Church. Yet I would suggest that these condemnations, and others, have been carefully focused on specific errors of liberalism so as not to disregard many of the key insights that liberals advanced, such as religious liberty, freedom of association, and economic liberty. Admittedly, the Church has prudently taken more than a century to develop her teaching on these matters. Consequently, the nuancing of liberalism has been gradual and slow to develop. IV. Neo-Liberalism Is Not Capitalism Per Se Having said what I have thus far about liberalism and neo-liberalism, I would like to focus now upon the free economy. Because the free-market system grew out of a liberal context, it is not surprising that certain liberal excesses accompanied its development and continues to permeate its expansion. However, my hope is to demonstrate that John Paul’s condemnation of neo-liberalism does not amount to a wholesale condemnation of the free economy as an economic system, but rather to what I will define in a moment as economic reductionism. In other words, as the free-market system is an economic outgrowth of liberalism, neo-liberalism is the sum total of liberal excess found within the free-market system. Neo-liberalism simply reflects those moral dispositions that are unacceptable to the Church in the marketplace. Thus, neo-liberalism is not synonymous with the free economy, nor does the market necessarily produce these excesses even though it might appear that way. I would even suggest that this moral disposition precedes any economic system, in as much as it is part and parcel of man’s fallen nature. This distinction between the free economy and neo-liberalism is absolutely necessary if one is to properly understand the Church’s teaching about the economic order. While this territory has been thoroughly covered elsewhere, it is often ignored or simply glossed-over 26. Again, as an example I quote David Schindler:
Here we see in explicit terms the conflation of the free economy with liberal excess—as if the former is determined by and dependent upon the latter. Since this distinction is so essential, it must be reiterated. To see the importance of this distinction, however, the free economy—properly understood—must be defined as an economic system that follows logically from an individual’s right to private property, economic initiative, and free trade 28. In short, the natural economic ordering of these rights is the free economy, or what has been termed the free-market system. The Church has always upheld the aforementioned rights as part and parcel of the nature and dignity of the human person, but it has been rather critical of how these rights have been a justification for acts of injustice towards others 29. It is this critical posture that has led certain individuals to believe that the Church essentially condemns the free economy. Perhaps if the development of the free-market system were understood from within its historical context, a greater appreciation of the Church’s teaching about the free economy would be gained. V. The Historical Development of the Free Market As with other developments within classical liberalism, the free-market system emerged as an economic philosophy that sought further to establish individual liberty and rights within the social order. In response to excessive taxation and protectionism—enforced by governments in Europe during the eighteenth and nineteenth centuries—thinkers in the liberal tradition, such as Adam Smith and Frederic Bastiat, advanced a notion of economic liberty that aimed to protect individuals from what they saw as the unjust confiscation and redistribution of private property by the state. Liberals also repudiated the hierarchy of classes and the privileges bestowed upon the aristocracy—whose social status was underwritten by their vast land holdings. 30 The free-market system was yet another way to level the social playing field. These individuals were the first to articulate the economic theory of the free market. As a prudential consideration, it was their contention that free markets provided the most effective means for achieving a greater degree of economic justice. Why? Because, in short, the free economy respects the right to obtain, use, and dispose of property in a voluntary manner, while rewarding individuals for their economic initiative. Furthermore, the free economy is the most just and efficient way to produce goods, conduct trade, and thus generate wealth. In Centesimus Annus, John Paul II confirms this fact: “It would appear that, on the level of individual nations and of international relations, the free market is the most efficient instrument for utilizing resources and effectively responding to needs.” 31 The free-market system took hold of Western Europe, beginning in Great Britain with the eighteenth-century economic explosion of the Industrial Revolution. It is here that the Church first addressed, at length, the sweeping changes that had turned the old feudal order upside down and offered a prudent assessment of the economic predicament facing the modern world. The reaction to the abuses of economic liberalism that gave rise to socialism inspired Pope Leo XIII to promulgate the encyclical Rerum Novarum, 32 in which he critiques certain abuses of the free-market system, not so much to reject it altogether as he did socialism, but to redirect the free economy in a manner more suitable to the ethical norms of the Gospel 33. Leo accomplished this feat by reflecting upon the poor conditions of the working class and the relationship between labor and capital. One hundred years later in Centesimus Annus, John Paul II refers to these same economic abuses as “unbridled capitalism.” 34 The qualifying term unbridled, however, is extremely important for understanding the Church’s critique of the free economy over the past one hundred years. According to the Church, the problem of most free-market advocates is not so much their economic theory, but the manner in which they have justified the subordination of the human person to the mechanisms of the market. This has occurred in a two ways. First, unbridled capitalism is closely related to what John Paul II calls economism. Economism is linked to the failure by some to see that human beings are the subject of work. This has led to the over-commodification of labor. 36 Another contributing factor to unbridled capitalism is the unfortunate reduction of man’s social nature to what is commonly referred to as homo-economicus. This view of man purports to explain man’s social existence solely in terms of his economic life. In effect, these economic attitudes reflect a deficient economic anthropology, and thus can be described as being economically reductionistic. The unfortunate consequence of economic reductionism is that it leads many to believe that acting without regard for the dignity of others in the name of profit or the invisible hand of the market is morally licit. Thus, profit is seen as the ultimate measure of economic activity as opposed to human dignity. Such utilitarian attitudes make productivity the measure of human worth. Yet is this intrinsic to the free economy—insofar as the free market refers to the voluntary exchange of goods and services and the protection of property rights—or is this simply a reflection of the moral blindness of those who espouse such a minimalist view of the human person? In other words, is it impossible to admit that individuals are capable of moving beyond selfish interest when acting in the market? Or is market activity fundamentally about greed? Clearly, the Church has condemned what it calls unbridled capitalism, but it has not denied the legitimacy of the free economy itself. On the contrary, it has distinguished between good and bad attitudes and behaviors within the marketplace. In effect, the Church has defended the free-economy against the corrupting influences of economic reductionism by situating economics within a much broader moral framework that provides a more suitable defense of the free market's economic value and the value of human dignity that any economy must presuppose. Thus, while the free economy is insufficient for achieving the common good, it is an essential element of the common good. To support this interpretation of the free economy within Catholic social teaching, I would like now to turn again to the condemnation of neo-liberalism that is made in Ecclesia in America:
The first point of interest is the explicit identification of neo-liberalism with “a purely economic conception of man.” Here, the pope does not condemn the free-market system but rather condemns those who not only think but act as if economic considerations alone constitute the whole of man’s social existence. Second, the pope alludes to the fact that some individuals use “the law of the market” and the profit motive to excuse themselves from their duties toward others. Again, he does not condemn nor deny the importance of the market’s logic, nor does he challenge the legitimacy of profit. He simply condemns those who use these economic factors as a rationalization for ignoring the dignity of others. Thus, when the pope condemns neo-liberalism in Ecclesia in America, he is condemning economic reductionism. In paragraph forty-two of Centesimus Annus, the pope had already established this distinction. He states:
This citation very clearly articulates the distinction the Church has always made. In other words, the free economy—properly ordered in accord with moral norms—poses no contradiction with Catholic social teaching, and therefore cannot be the object of John Paul’s condemnation of neo-liberalism. Rather, the term neo-liberalism is synonymous with the pope’s use of the term unbridled capitalism, and hence, its condemnation is, in fact, a condemnation of a very specific kind of liberal excess that subordinates man to the mechanisms of the market rather than directs the market toward the good of man. Conclusion By his use of the term neo-liberalism, John Paul II has introduced a new word into the corpus of Catholic social teaching. It is a word that has the potential for serious misinterpretation if it is not properly understood from within the Church’s ongoing dialogue with liberalism. Liberalism has helped focus the social debate and has also created the impetus for the Church to further develop her social doctrine. I might even suggest that liberalism has been a cause of the Church’s deeper reflections on the topic of human freedom. Though liberalism has been used for many wrong-headed social experiments, it is not diametrically opposed to Christianity. Moreover, the condemnation of neo-liberalism in no way anathematizes the advances of liberal economic and political institutions. It is a term meant simply to condemn specific errors that reflect a misguided application of liberalism. I close by echoing with Pope John Paul II that neo-liberalism is a “sin which cries to heaven.” Its abolition requires an integrated approach to the progress of human freedom. Authentic human culture necessitates that liberty be both positive and negative in its constitution. Civil liberty secured by the rule of law is an indispensable component of the common good for any culture. Yet without a firm grounding of freedom in the moral order, the free society will inevitably turn in upon itself and betray its own noble objective. Lord Acton once stated, “Liberty has not subsisted outside of Christianity. Providence, while it summons a larger part of mankind to the enjoyment of truth, which is the blessing of religion, has called a larger part of mankind to the enjoyment of freedom, which is the blessing of the political order—that freedom should be religious, and that religion should be free.” 39 The establishment of justice within the economic order requires the fullness of freedom. Only in establishing the fullest sense of human freedom—in both its positive and negative manifestations—will the cultural drama of the Americas achieve an adequate degree of economic justice. Endnotes
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