Catholicism and “Neoliberalism”: Strawmen Are Often Contrary to Church Teaching

David Cloutier at the Catholic Moral Theology blog links approvingly to a post at dotCommonweal addressing Romney’s political views which asks whether “neoliberalism” (the which is here used to mean something along the lines of free market capitalism) and Catholicism can ever be compatible. He says:

Superb exchange going on over at dotCommonweal over a post about how certain political conservatives, like Rick Santorum or Michael Gerson, try to reconcile their Catholicism with the neoliberal paradigm. For once, even the comment thread is worth reading!

I think this is an important – if not THE important – debate about Catholicism and politics in the current election. Often, the debate over particular policies dominates, but in fact, what we should be looking at are the basic principles of the economic order. If a candidate fundamentally contradicts the basic principles, Catholics should have reservations about supporting him. In the post referred to above, “neoliberalism” is cast in terms of a pure free-market conception, in which governments take a minimal role in economic activity, providing for enforcement of contracts, a stable currency, etc. – protection against “force and fraud.” Others claim that Gerson forthrightly support subsidiary actors – such as families, community organizations, and churches – and so is not in fact individualist.

The (frequently made) mistake here is one that goes back to Edmund Burke, that “father” of conservatism. Burke seeks to deal with nascent industrial capitalism by (Warning: blogging oversimplification ahead…) distinguishing between a sphere of “culture” (or “civil society”) that can be fostered, and refuses to attribute social problems to the mechanisms of the market itself. He defends the market as good, over against the landed establishment (the “nobles”) of the pre-industrial order, which is who he is opposing. But for him, the market is not all there is. (One sometimes sees a variant of this in defending Adam Smith by noting one must read both The Wealth of Nations and The Theory of Moral Sentiments.)

There are two fundamental problems with maintaining this thesis today, which never seem to be adequately explained. First, Burke (like Adam Smith, in this way) is writing prior to the advent of large, joint-stock corporations. They are imagining relatively small-scale market actors. This observation is important for the second reason: it is overwhelmingly clear that large-scale corporate capitalism is destructive of small-scale community organization. As Wendell Berry has written repeatedly, community does not “have a value” measurable in economic terms, and therefore is constantly undermined by the market for the sake of its expansion.

Ultimately, Benedict’s work continues the tradition of CST, which maintains a balanced approach, accepting markets if they are “circumscribed within a strong juridical framework” by sound government regulation (see Centesimus Annus, paragraph 42), and if they are respectful of the institutions of civil society (including the family), which are in some sense “prior” to both market and state. This approach tends to fit uncomfortably with the rights-based individualism that sometimes contaminates Democratic attempts to work for the common good, but it outright contradicts the anti-government rhetoric of “free enterprise” that is routine among Republicans.

It was the last paragraph that threw me and sent me back to re-read what came before a bit. Living, like most people, within a world that shapes and is shaped by my own beliefs and dispositions, it’s not hard to forget that people can have such contrary assumptions. That someone would think that a Catholic worldview is a “sometimes” a difficult fit with the Democratic party worldview but clearly incompatible with being a Republican is a little eye-opening for me. It’s not just that I and most of the other Catholics I know are fairly conservative, it’s that my acquaintances who are mainstream progressives are quite eager to make it clear that people with my views on marriage, sexuality, abortion and childbearing are absolutely unwelcome on their side of the aisle. That other people can see the division between parties as not being primarily over these issues always seems surprising to me.

Still, the topic here is Catholicism and economic ideology, and I think there’s some light to shed on what Cloutier claims here. I don’t bring up the cultural divide between political alignments as a red herring, though, I think it’s key. Part of the issue, I think, is that the ideological polarization of our society tends to lead people to thinking of the ideas of “the other side” in very broad stereotypes. There is some accuracy to them, but they also tend to obscure what people really think by taking a simplified form of a belief and building it into a strawman.

If we cast “neoliberalism” or “free market ideology” as the belief that only things that “have value” in measurable, market terms should be regarded, and that the market should be the determining factor in all things, then yes, these will be ideologies incompatible with Catholicism, with humanism, and with civilized life. On the other hand, the very untenability of this conception of what conservatives are talking about ought to be an indicator that perhaps some mistake is being made. We can imagine that conservatives are all as whacked out as Ayn Rand, but this involves both ignoring the criticism of Randian libertarianism that comes from many conservatives, and also assuming that a lot of what conservatives say stems from false consciousness. Try measuring it, for instance, against the following quote from Santorum (the person who is being accused by dotCommonweal of holding market beliefs incompatible with Catholicism):

This whole idea of personal autonomy, well I don’t think most conservatives hold that point of view. Some do. They have this idea that people should be left alone, be able to do whatever they want to do, government should keep our taxes down and keep our regulations low, that we shouldn’t get involved in the bedroom, we shouldn’t get involved in cultural issues. You know, people should do whatever they want. Well, that is not how traditional conservatives view the world and I think most conservatives understand that individuals can’t go it alone. [source]

Now, as the linked post shows, Santorum’s comments here are enough to cause infighting among different conservative factions, but clearly this kind of thinking (which could fairly be described as subsidiary rather than individualistic) that is common enough in the conservative mainstream to attract more followers than the radical individualism of pure libertarianism.

In point of fact, supporting a free market approach to economics (and indeed, I probably have a more free market approach than Santorum, in that he seems to adhere to the idea that trying to prop up teetering rust-belt industries via subsidies will stave off the inevitable rather than prolonging the painful decline) does not mean assigning no value to things that are not easily quantifiable in monetary terms (contra Wendel Berry who at times cultivates an almost willful ignorance about matters economic and technological.) Indeed, one of the areas in which even economists have sought to capture this in recent decades is in looking at the ways in which information and relationships are essential parts of economic systems and economic growth, despite the fact that they are nearly impossible to quantify in purely monetary terms. This is why the kind of corporate restructuring which Romney is being criticized for participating in during his Bain days is so prone to failure: even if it’s clear that a company needs to be reorganized in order to avoid bankruptcy, the process of restructuring often does so much knowledge to the networks of relationships and morale within the company that the company is sent into a tailspin for reasons that would not be immediately obvious from a business case.

Individualism is such a natural temptation it would be shocking if we found it only on one side of the political spectrum. If on the right it is found in the more libertarian side of conservatism, on the left it shows up in the idea that the state should provide each person with sufficient support to not have to rely on others for help, making each person’s primary relationship be with the state rather than with other people and institutions. (This seems to work: through a mixture of cause and effect we find that the most splintered families are among those who require government aid while the greatest tendency to intact family and social structures is found at the higher end of the income scale.) This can come out in all sorts of unexpected ways. I recall being struck by it particularly a while back when talking with a relative (relatively progressive) who lives in Germany, and who maintained that the German outlawing of homeschooling (educating your children yourself in Germany rather than at a recognized school can be grounds for having your children taken away by the state) was just because it was the state’s duty to protect the right of a child to a good education from any educational delusions the parents might be under.

Radical individualism is such an attractive error in modern affluent societies, it would be surprising if we found it only on one side of the political aisle. If we imagine that the other side is completely owned by it, while ours is only occasionally afflicted, we are probably failing to understand either side well.

6 Responses to Catholicism and “Neoliberalism”: Strawmen Are Often Contrary to Church Teaching

  • “First, Burke (like Adam Smith, in this way) is writing prior to the advent of large, joint-stock corporations.”

    That is historical rubbish. The East India Company for example, a behemoth joint stock company of Burke’s day, was chartered in 1599. Smith wrote about the East India Company: “While the East India Company had been a trading endeavor, it had provided great service to the state and its people, justifying the monopoly privileges and helping its stockholders’ dividends to growth. After territorial expansion occurred, this role and its privileges required revision, for Company interests were at cross purposes with those of the state.”

    When someone makes such an elementary historical mistake like this, it is difficult to take them very seriously

  • Darwin says:

    Yeah, I had to pick what to go after, but I think that the idea that Burke and Smith had an overly rosy idea of what capitalism because it hadn’t got big enough yet strikes me as springing form a simplistic kind of anachronism in which one assumes that everything was simpler in the “old days”. Joint stock companies were, obviously, both huge and very, very powerful in the 1700s. (Heck, the East India Company had its own army.) And Smith and Burke weren’t naive about the temptations of capitalism. It was, after all, Smith who said, “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public.”

  • David says:

    Hi – Thanks for the attention to my post. It is just a blog post. I am familiar with the extensive ventures organized at joint-stock corporations prior to the 19th century. In nearly all cases, these were (if I am not mistaken) more or less official government-chartered monopolies that made possible extensive investments (i.e. in trade). By “joint-stock corporation” I am speaking about the common usage today, for an eneterprise that is not a kind of state-sponsored monopoly. Mr McClarey comment from Smith indicates the clear purpose of such corporations (i.e. to serve BOTH the state and the shareholders), and that such corporations should have their privileges revised if they no longer serve the state. This seems a far cry from the way joint-stock corporations have functioned for the last century-plus, to which I was referring in my post.

  • Yes David, you are mistaken. Corporations had to be granted existence by Parliament, but they operated in precisely the same way as large publicly traded corporations do today. They often got into bed with government, as Adam Smith noted and dreaded, just as such corportations do today.

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