Article presented in 1985 in a
symposium in
Market Economy and Ethics
Allow
me to give a cordial welcome — also in the name of the two other protectors,
Cardinal Höffner and Cardinal Etchegaray — to all the participants here
present for the Symposium on Church and Economy. I am very glad that the
cooperation between the Pontifical Council for the Laity, the International
Federation of Catholic Universities, the Institute of the German Economy and
the Konrad-Adenauer-Foundation, has made possible these world-wide
conversations on a question of deep concern for all of us.
“The
economic inequality between the northern and southern hemispheres of the
globe is becoming more and more an inner threat to the cohesion of the human
family. The danger for our future from such a threat may be no less real than
that proceeding from the weapons arsenals with which the East and the West
oppose one another. New exertions must be made to overcome this tension,
since all methods employed hitherto have proven themselves inadequate. In
fact, the misery in the world has increased in shocking measure during the
last thirty years. In order to find solutions that will truly lead us
forward, new economic ideas will be necessary. But such measures do not seem
conceivable or, above all, practicable without new moral impulses. It is at
this point that a dialogue between Church and economy becomes both possible
and necessary.
“Let
me clarify somewhat the exact point in question. At first glance, precisely
in terms of classical economic theory, it is not obvious what the Church and
the economy should actually have to do with one another, aside from the fact
that the Church owns businesses and so is a factor in the market. The Church
should not enter into dialogue here as a mere component in the economy, but
rather in its own right as Church.
“Here,
however, we must face the objection raised especially after the Second
Vatican Council, that the autonomy of specialized realms is to be respected
above all. Such an objection holds that the economy ought to play by its own
rules and not according to moral considerations imposed on it from without.
Following the tradition inaugurated by Adam Smith, this position holds that
the market is incompatible with ethics because voluntary “moral” actions
contradict market rules and drive the moralizing entrepreneur out of the
game. 3 For a long time, then, business
ethics rang like hollow metal because the economy was held to work on
efficiency and not on morality. 4 The market's inner logic should
free us precisely from the necessity of having to depend on the morality of
its participants. The true play of market laws best guarantees progress and
even distributive justice.
“The
great successes of this theory concealed its limitations for a long time. But
now in a changed situation, its tacit philosophical presuppositions and thus
its problems become clearer. Although this position admits the freedom of
individual businessmen, and to that extent can be called liberal, it is in
fact deterministic in its core. It presupposes that the free play of market
forces can operate in one direction only, given the constitution of man and
the world, namely, toward the self-regulation of supply and demand, and
toward economic efficiency and progress.
“This
determinism, in which man is completely controlled by the binding laws of the
market while believing he acts in freedom from them, includes yet another and
perhaps even more astounding presupposition, namely, that the natural laws of
the market are in essence good (if I may be permitted so to speak) and
necessarily work for the good, whatever may be true of the morality of
individuals. These two presuppositions are not entirely false, as the successes
of the market economy illustrate. But neither are they universally applicable
and correct, as is evident in the problems of today's world economy. Without
developing the problem in its details here — which is not my task — let me
merely underscore a sentence of Peter Koslowski's that illustrates the point
in question: “The economy is governed not only by economic laws, but is also
determined by men...”. 5 Even if the market economy does
rest on the ordering of the individual within a determinate network of rules,
it cannot make man superfluous or exclude his moral freedom from the world of
economics. It is becoming ever so clear that the development of the world
economy has also to do with the development of the world community and with
the universal family of man, and that the development of the spiritual powers
of mankind is essential in the development of the world community. These
spiritual powers are themselves a factor in the economy: the market rules
function only when a moral consensus exists and sustains them.
“If
I have attempted so far to point to the tension between a purely liberal
model of the economy and ethical considerations, and thereby to circumscribe
a first set of questions, I must now point out the opposite tension. The
question about market and ethics has long ceased to be merely a theoretical
problem. Since the inherent inequality of various individual economic zones
endangers the free play of the market, attempts at restoring the balance have
been made since the 1950s by means of development projects. It can no longer
be overlooked that these attempts have failed and have even intensified the
existing inequality. The result is that broad sectors of the
“The
full extent of this question becomes even more apparent when we include the
third element of economic and theoretical considerations characteristic of
today's situation: the Marxist world. In terms of the structure of its
economic theory and praxis, the Marxist system as a centrally administered
economy is a radical antithesis to the market economy. 6 Salvation is expected because there
is no private control of the means of production, because supply and demand
are not brought into harmony through market competition, because there is no
place for private profit seeking, and because all regulations proceed from a
central economic administration. Yet, in spite of this radical opposition in
the concrete economic mechanisms, there are also points in common in the
deeper philosophical presuppositions. The first of these consists in the fact
that Marxism, too, is deterministic in nature and that it too promises a
perfect liberation as the fruit of this determinism. For this reason, it is a
fundamental error to suppose that a centralized economic system is a moral
system in contrast to the mechanistic system of the market economy. This
becomes clearly visible, for example, in Lenin's acceptance of Sombart's
thesis that there is in Marxism no grain of ethics, but only economic laws. 7 Indeed, determinism is here far
more radical and fundamental than in liberalism: for at least the latter recognizes
the realm of the subjective and considers it as the place of the ethical. The
former, on the other hand, totally reduces becoming and history to economy,
and the delimitation of one's own subjective realm appears as resistance to
the laws of history, which alone are valid, and as a reaction against
progress, which cannot be tolerated. Ethics is reduced to the philosophy of
history, and the philosophy of history degenerates into party strategy.
“But
let us return once again to the common points in the philosophical
foundations of Marxism and capitalism taken strictly. The second point in
common — as will already have been clear in passing — consists in the fact
that determinism includes the renunciation of ethics as an independent entity
relevant to the economy \. This shows itself in an especially dramatic way in
Marxism. Religion is traced back to economics as the reflection of a
particular economic system and thus, at the same time, as an obstacle to
correct knowledge, to correct action — as an obstacle to progress, at which
the natural laws of history aim. It is also presupposed that history, which
takes its course from the dialectic of negative and positive, must, of its
inner essence and with no further reasons being given, finally end in total positivity.
That the Church can contribute nothing positive to the world economy on such
a view is clear; its only significance for economics is that it must be
overcome. That it can be used temporarily as a means for its own
self-destruction and thus as an instrument for the “positive forces of
history” is an ‘insight’ that has only recently surfaced. Obviously, it
changes nothing in the fundamental thesis.
“For
the rest, the entire system lives in fact from the apotheosis of the central
administration in which the world spirit itself would have to be at work, if
this thesis were correct. That this is a myth in the worst sense of the word
is simply an empirical statement that is being continually verified. And thus
precisely the radical renunciation of a concrete dialogue between Church and
economy which is presupposed by this thought becomes a confirmation of its
necessity.
“In
the attempt to describe the constellation of a dialogue between Church and
economy , I have discovered yet a fourth aspect. It may be seen in the
well-known remark made by Theodore Roosevelt in 1912: “I believe that the
assimilation of the Latin-American countries to the
“But
this cannot proceed purely as a dialogue within the Church. It will be
fruitful only if it is conducted with those Christians who manage the economy
\. A long tradition has led them to regard their Christianity as a private
concern, while as members of the business community they abide by the laws of
the economy.
“These
realms have come to appear mutually exclusive in the modern context of the
separation of the subjective and objective realms. But the whole point is
precisely that they should meet, preserving their own integrity and yet
inseparable. It is becoming an increasingly obvious fact of economic history
that the development of economic systems which concentrate on the common good
depends on a determinate ethical system, which in turn can be born and
sustained only by strong religious convictions. 9 Conversely, it has also become
obvious that the decline of such discipline can actually cause the laws of
the market to collapse. An economic policy that is ordered not only to the
good of the group — indeed, not only to the common good of a determinate
state — but to the common good of the family of man demands a maximum of
ethical discipline and thus a maximum of religious strength. The political
formation of a will that employs the inherent economic laws towards this goal
appears, in spite of all humanitarian protestations, almost impossible today.
It can only be realized if new ethical powers are completely set free. A
morality that believes itself able to dispense with the technical knowledge of
economic laws is not morality but moralism. As such it is the antithesis of
morality. A scientific approach that believes itself capable of managing
without an ethos misunderstands the reality of man. Therefore it is not
scientific. Today we need a maximum of specialized economic understanding,
but also a maximum of ethos so that specialized economic understanding may
enter the service of the right goals. Only in this way will its knowledge be
both politically practicable and socially tolerable.”
[1] This article, translated by Stephen
Wentworth Arndt, is provided courtesy of Dr. Johannes Stemmler, secretary
emeritus of the BKU (Federation of Catholic Entrepreneurs) and secretary of
Ordo socialis in
[3] Cf. Peter Koslowski, “Über
Notwendigkeit und Möglichkeit einer Wirtschaftsethik,” Scheidewege.
Jahresschrift für skeptisches Denken 15 (1985/86): 301, 204–305. This
fundamental study has given me essential suggestions for my own paper.
[Ed. note: This paper, “On the Necessity and Possibility of an Ethics of the Economy,” is further elaborated and available in English in the book by P. Koslowski, Ethics of Capitalism; and, Critique of Sociobiology: Two Essays with a Comment by James M. Buchanan, vol. 10, Studies in Economic Ethics and Philosophy (New York: Springer-Verlag, 1996), with the 6th German edition 1998, along with Spanish, Korean, Russian, Chinese, and Japanese translations.]
[6] Cf. Card. J. Höffner, Wirtschaftsordnung
und Wirtschaftsethik. Richtlinien der katholischen Soziallehre, ed.
Sekretariat der Deutschen Bischofskonferenz (
[7] Koslowski, “Über Notwendigkeit und
Möglichkeit einer Wirtschaftsethik,” 296, with reference to Lenin, Werke
(
[8] I found these two considerations in
the contribution of A. Metalli, “La grande epopea degli evangelici,” Trenta
giorni 3, no. 8 (1984): 9, 8–20.
[9] For detailed information see P.
Koslowski, “Religion, Okonomie, Ethik. Eine sozialtheoretische und
ontologische Analyse ihres Zusammenhangs,“ in Die religiöse Dimension der
Gesellschaft, Religion und ihre Theorien, ed. P. Koslowski (Tübingen,
1985), 76–96.
[Ed. note: This paper, “Religion, Economics, Ethics: An Analysis of Their Relationship from the Perspective of Social Thought and Ontology,” in The Religious Dimension of Society: Religion and its Theories, is further elaborated and available in English in the book by P. Koslowski, Principles of Ethical Economy, vol. 17, Issues in Business Ethics (Boston: Kluwer Academic Publishers, 2001), with a 2nd German edition in 1994 along with French, Russian, Chinese, and Spanish translations.] |
Reflections on the Teaching of Vatican II Through the Magisterium of John Paul II, Benedict XVI and Francis
Monday, May 21, 2012
J. Ratzinger, "Market Economy and Ethics" 1985
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment