Consumers should explore alternative paths to a moral economy

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

Global interconnectedness has led to the emergence of a new political power, that of consumers and their associations. This is a phenomenon that needs to be further explored, as it contains positive elements to be encouraged as well as excesses to be avoided. It is good for people to realize that purchasing is always a moral — and not simply economic — act. Hence the consumer has a specific social responsibility, which goes hand-in-hand with the social responsibility of the enterprise. Consumers should be continually educated145 regarding their daily role, which can be exercised with respect for moral principles without diminishing the intrinsic economic rationality of the act of purchasing. In the retail industry, particularly at times like the present when purchasing power has diminished and people must live more frugally, it is necessary to explore other paths: for example, forms of cooperative purchasing like the consumer cooperatives that have been in operation since the nineteenth century, partly through the initiative of Catholics. In addition, it can be helpful to promote new ways of marketing products from deprived areas of the world, so as to guarantee their producers a decent return. However, certain conditions need to be met: the market should be genuinely transparent; the producers, as well as increasing their profit margins, should also receive improved formation in professional skills and technology; and finally, trade of this kind must not become hostage to partisan ideologies. A more incisive role for consumers, as long as they themselves are not manipulated by associations that do not truly represent them, is a desirable element for building economic democracy.

145 Cf. John Paul II, Encyclical Letter Centesimus Annus, 36: Acta Apostolicæ Sedis 83 (1991), 838-840.

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Financiers and investors share ethical responsibility for development projects

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

F  inance, therefore — through the renewed structures and operating methods that have to be designed after its misuse, which wreaked such havoc on the real economy* — now needs to go back to being an instrument directed towards improved wealth creation and development. Insofar as they are instruments, the entire economy and finance, not just certain sectors, must be used in an ethical way so as to create suitable conditions for human development and for the development of peoples. It is certainly useful, and in some circumstances imperative, to launch financial initiatives in which the humanitarian dimension predominates. However, this must not obscure the fact that the entire financial system has to be aimed at sustaining true development. Above all, the intention to do good must not be considered incompatible with the effective capacity to produce goods. Financiers must rediscover the genuinely ethical foundation of their activity, so as not to abuse the sophisticated instruments which can serve to betray the interests of savers. Right intention, transparency, and the search for positive results are mutually compatible and must never be detached from one another. If love is wise, it can find ways of working in accordance with provident and just expediency, as is illustrated in a significant way by much of the experience of credit unions.

Both the regulation of the financial sector, so as to safeguard weaker parties and discourage scandalous speculation, and experimentation with new forms of finance, designed to support development projects, are positive experiences that should be further explored and encouraged, highlighting the responsibility of the investor. Furthermore, the experience of micro-finance, which has its roots in the thinking and activity of the civil humanists — I am thinking especially of the birth of pawnbroking — should be strengthened and fine-tuned. This is all the more necessary in these days when financial difficulties can become severe for many of the more vulnerable sectors of the population, who should be protected from the risk of usury and from despair. The weakest members of society should be helped to defend themselves against usury, just as poor peoples should be helped to derive real benefit from micro-credit, in order to discourage the exploitation that is possible in these two areas. Since rich countries are also experiencing new forms of poverty, micro-finance can give practical assistance by launching new initiatives and opening up new sectors for the benefit of the weaker elements in society, even at a time of general economic downturn.

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* Pope Benedict issued this encyclical in the wake of the financial crisis of 2007-2008. — Ed.

Labor unions should embrace new perspectives

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

While reflecting on the theme of work, it is appropriate to recall how important it is that labour unions — which have always been encouraged and supported by the Church — should be open to the new perspectives that are emerging in the world of work. Looking to wider concerns than the specific category of labour for which they were formed, union organizations are called to address some of the new questions arising in our society: I am thinking, for example, of the complex of issues that social scientists describe in terms of a conflict between worker and consumer. Without necessarily endorsing the thesis that the central focus on the worker has given way to a central focus on the consumer, this would still appear to constitute new ground for unions to explore creatively. The global context in which work takes place also demands that national labour unions, which tend to limit themselves to defending the interests of their registered members, should turn their attention to those outside their membership, and in particular to workers in developing countries where social rights are often violated. The protection of these workers, partly achieved through appropriate initiatives aimed at their countries of origin, will enable trade unions to demonstrate the authentic ethical and cultural motivations that made it possible for them, in a different social and labour context, to play a decisive role in development. The Church’s traditional teaching makes a valid distinction between the respective roles and functions of trade unions and politics. This distinction allows unions to identify civil society as the proper setting for their necessary activity of defending and promoting labour, especially on behalf of exploited and unrepresented workers, whose woeful condition is often ignored by the distracted eye of society.

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Decent work expresses and honors man’s intrinsic dignity

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

No consideration of the problems associated with development could fail to highlight the direct link between poverty and unemployment. In many cases, poverty results from a violation of the dignity of human work, either because work opportunities are limited (through unemployment or underemployment), or “because a low value is put on work and the rights that flow from it, especially the right to a just wage and to the personal security of the worker and his or her family.”143 For this reason, on 1 May 2000 on the occasion of the Jubilee of Workers, my venerable predecessor Pope John Paul II issued an appeal for “a global coalition in favour of ‘decent work,’”144 supporting the strategy of the International Labour Organization. In this way, he gave a strong moral impetus to this objective, seeing it as an aspiration of families in every country of the world. What is meant by the word “decent” in regard to work? It means work that expresses the essential dignity of every man and woman in the context of their particular society: work that is freely chosen, effectively associating workers, both men and women, with the development of their community; work that enables the worker to be respected and free from any form of discrimination; work that makes it possible for families to meet their needs and provide schooling for their children, without the children themselves being forced into labour; work that permits the workers to organize themselves freely, and to make their voices heard; work that leaves enough room for rediscovering one’s roots at a personal, familial and spiritual level; work that guarantees those who have retired a decent standard of living.

143 John Paul II, Encyclical Letter Laborem Exercens, 8: Acta Apostolicæ Sedis 73 (1981), 594-598.
144 Jubilee of Workers, Greeting after Mass, 1 May 2000.

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Migrants and their families must not be treated as mere labor commodities

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

Another aspect of integral human development that is worthy of attention is the phenomenon of migration. This is a striking phenomenon because of the sheer numbers of people involved, the social, economic, political, cultural and religious problems it raises, and the dramatic challenges it poses to nations and the international community. We can say that we are facing a social phenomenon of epoch-making proportions that requires bold, forward-looking policies of international cooperation if it is to be handled effectively. Such policies should set out from close collaboration between the migrants’ countries of origin and their countries of destination; it should be accompanied by adequate international norms able to coordinate different legislative systems with a view to safeguarding the needs and rights of individual migrants and their families, and at the same time, those of the host countries. No country can be expected to address today’s problems of migration by itself. We are all witnesses of the burden of suffering, the dislocation and the aspirations that accompany the flow of migrants. The phenomenon, as everyone knows, is difficult to manage; but there is no doubt that foreign workers, despite any difficulties concerning integration, make a significant contribution to the economic development of the host country through their labour, besides that which they make to their country of origin through the money they send home. Obviously, these labourers cannot be considered as a commodity or a mere workforce. They must not, therefore, be treated like any other factor of production. Every migrant is a human person who, as such, possesses fundamental, inalienable rights that must be respected by everyone and in every circumstance.142

142 Cf. Pontifical Council for the Pastoral Care of Migrants and Itinerant People, Instruction Erga Migrantes Caritas Christi (3 May 2004): Acta Apostolicæ Sedis 96 (2004), 762-822.

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Education and tourism promote solidarity across national boundaries

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

Greater solidarity at the international level is seen especially in the ongoing promotion — even in the midst of economic crisis* — of greater access to education, which is at the same time an essential precondition for effective international cooperation. The term “education” refers not only to classroom teaching and vocational training — both of which are important factors in development — but to the complete formation of the person. In this regard, there is a problem that should be highlighted: in order to educate, it is necessary to know the nature of the human person, to know who he or she is. The increasing prominence of a relativistic understanding of that nature presents serious problems for education, especially moral education, jeopardizing its universal extension. Yielding to this kind of relativism makes everyone poorer and has a negative impact on the effectiveness of aid to the most needy populations, who lack not only economic and technical means, but also educational methods and resources to assist people in realizing their full human potential.

An illustration of the significance of this problem is offered by the phenomenon of international tourism,141 which can be a major factor in economic development and cultural growth, but can also become an occasion for exploitation and moral degradation. The current situation offers unique opportunities for the economic aspects of development — that is to say the flow of money and the emergence of a significant amount of local enterprise — to be combined with the cultural aspects, chief among which is education. In many cases this is what happens, but in other cases international tourism has a negative educational impact both for the tourist and the local populace. The latter are often exposed to immoral or even perverted forms of conduct, as in the case of so-called sex tourism, to which many human beings are sacrificed even at a tender age. It is sad to note that this activity often takes place with the support of local governments, with silence from those in the tourists’ countries of origin, and with the complicity of many of the tour operators. Even in less extreme cases, international tourism often follows a consumerist and hedonistic pattern, as a form of escapism planned in a manner typical of the countries of origin, and therefore not conducive to authentic encounter between persons and cultures. We need, therefore, to develop a different type of tourism that has the ability to promote genuine mutual understanding, without taking away from the element of rest and healthy recreation. Tourism of this type needs to increase, partly through closer coordination with the experience gained from international cooperation and enterprise for development.

141 Cf. Benedict XVI, Address to the Bishops of Thailand on their “Ad Limina” Visit, 16 May 2008.

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* Pope Benedict issued this encyclical in the wake of the financial crisis of 2007-2008. — Ed.

Development aid can benefit poor countries by enabling citizen solidarity

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

In the search for solutions to the current economic crisis, development aid for poor countries must be considered a valid means of creating wealth for all. What aid programme is there that can hold out such significant growth prospects — even from the point of view of the world economy — as the support of populations that are still in the initial or early phases of economic development? From this perspective, more economically developed nations should do all they can to allocate larger portions of their gross domestic product to development aid, thus respecting the obligations that the international community has undertaken in this regard. One way of doing so is by reviewing their internal social assistance and welfare policies, applying the principle of subsidiarity and creating better integrated welfare systems, with the active participation of private individuals and civil society. In this way, it is actually possible to improve social services and welfare programmes, and at the same time to save resources — by eliminating waste and rejecting fraudulent claims — which could then be allocated to international solidarity. A more devolved and organic system of social solidarity, less bureaucratic but no less coordinated, would make it possible to harness much dormant energy, for the benefit of solidarity between peoples.

One possible approach to development aid would be to apply effectively what is known as fiscal subsidiarity, allowing citizens to decide how to allocate a portion of the taxes they pay to the State. Provided it does not degenerate into the promotion of special interests, this can help to stimulate forms of welfare solidarity from below, with obvious benefits in the area of solidarity for development as well.

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Global development provides opportunities for both economic and cultural growth

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

C ooperation for development must not be concerned exclusively with the economic dimension: it offers a wonderful opportunity for encounter between cultures and peoples. If the parties to cooperation on the side of economically developed countries — as occasionally happens — fail to take account of their own or others’ cultural identity, or the human values that shape it, they cannot enter into meaningful dialogue with the citizens of poor countries. If the latter, in their turn, are uncritically and indiscriminately open to every cultural proposal, they will not be in a position to assume responsibility for their own authentic development.139 Technologically advanced societies must not confuse their own technological development with a presumed cultural superiority, but must rather rediscover within themselves the oft-forgotten virtues which made it possible for them to flourish throughout their history. Evolving societies must remain faithful to all that is truly human in their traditions, avoiding the temptation to overlay them automatically with the mechanisms of a globalized technological civilization. In all cultures there are examples of ethical convergence, some isolated, some interrelated, as an expression of the one human nature, willed by the Creator; the tradition of ethical wisdom knows this as the natural law.140 This universal moral law provides a sound basis for all cultural, religious and political dialogue, and it ensures that the multi-faceted pluralism of cultural diversity does not detach itself from the common quest for truth, goodness and God. Thus adherence to the law etched on human hearts is the precondition for all constructive social cooperation. Every culture has burdens from which it must be freed and shadows from which it must emerge. The Christian faith, by becoming incarnate in cultures and at the same time transcending them, can help them grow in universal brotherhood and solidarity, for the advancement of global and community development.

139 Cf. Paul VI, Encyclical Letter Populorum Progressio, 10, 41: Acta Apostolicæ Sedis 59 (1967), 262, 277-278.
140 Cf. Benedict XVI, Address to Members of the International Theological Commission, 5 October 2007; Address to the Participants in the International Congress on Natural Moral Law, 12 February 2007.

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A just global economy must incorporate both subsidiarity and solidarity

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

T he principle of subsidiarity must remain closely linked to the principle of solidarity and vice versa, since the former without the latter gives way to social privatism, while the latter without the former gives way to paternalist social assistance that is demeaning to those in need. This general rule must also be taken broadly into consideration when addressing issues concerning international development aid. Such aid, whatever the donors’ intentions, can sometimes lock people into a state of dependence and even foster situations of localized oppression and exploitation in the receiving country. Economic aid, in order to be true to its purpose, must not pursue secondary objectives. It must be distributed with the involvement not only of the governments of receiving countries, but also local economic agents and the bearers of culture within civil society, including local Churches. Aid programmes must increasingly acquire the characteristics of participation and completion from the grass roots. Indeed, the most valuable resources in countries receiving development aid are human resources: herein lies the real capital that needs to accumulate in order to guarantee a truly autonomous future for the poorest countries. It should also be remembered that, in the economic sphere, the principal form of assistance needed by developing countries is that of allowing and encouraging the gradual penetration of their products into international markets, thus making it possible for these countries to participate fully in international economic life. Too often in the past, aid has served to create only fringe markets for the products of these donor countries. This was often due to a lack of genuine demand for the products in question: it is therefore necessary to help such countries improve their products and adapt them more effectively to existing demand. Furthermore, there are those who fear the effects of competition through the importation of products — normally agricultural products — from economically poor countries. Nevertheless, it should be remembered that for such countries, the possibility of marketing their products is very often what guarantees their survival in both the short and long term. Just and equitable international trade in agricultural goods can be beneficial to everyone, both to suppliers and to customers. For this reason, not only is commercial orientation needed for production of this kind, but also the establishment of international trade regulations to support it and stronger financing for development in order to increase the productivity of these economies.

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Fraternal cooperation must acknowledge the roles of both faith and reason

From Pope Benedict XVI’s encyclical Caritas in Veritate (2009):

The Christian religion and other religions can offer their contribution to development only if God has a place in the public realm, specifically in regard to its cultural, social, economic, and particularly its political dimensions. The Church’s social doctrine came into being in order to claim “citizenship status” for the Christian religion.135 Denying the right to profess one’s religion in public and the right to bring the truths of faith to bear upon public life has negative consequences for true development. The exclusion of religion from the public square — and, at the other extreme, religious fundamentalism — hinders an encounter between persons and their collaboration for the progress of humanity. Public life is sapped of its motivation and politics takes on a domineering and aggressive character. Human rights risk being ignored either because they are robbed of their transcendent foundation or because personal freedom is not acknowledged. Secularism and fundamentalism exclude the possibility of fruitful dialogue and effective cooperation between reason and religious faith. Reason always stands in need of being purified by faith: this also holds true for political reason, which must not consider itself omnipotent. For its part, religion always needs to be purified by reason in order to show its authentically human face. Any breach in this dialogue comes only at an enormous price to human development.

Fruitful dialogue between faith and reason cannot but render the work of charity more effective within society, and it constitutes the most appropriate framework for promoting fraternal collaboration between believers and non-believers in their shared commitment to working for justice and the peace of the human family. In the Pastoral Constitution Gaudium et Spes, the Council fathers asserted that “believers and unbelievers agree almost unanimously that all things on earth should be ordered towards man as to their centre and summit.”136 For believers, the world derives neither from blind chance nor from strict necessity, but from God’s plan. This is what gives rise to the duty of believers to unite their efforts with those of all men and women of good will, with the followers of other religions and with non-believers, so that this world of ours may effectively correspond to the divine plan: living as a family under the Creator’s watchful eye. A particular manifestation of charity and a guiding criterion for fraternal cooperation between believers and non-believers is undoubtedly the principle of subsidiarity,137 an expression of inalienable human freedom. Subsidiarity is first and foremost a form of assistance to the human person via the autonomy of intermediate bodies. Such assistance is offered when individuals or groups are unable to accomplish something on their own, and it is always designed to achieve their emancipation, because it fosters freedom and participation through assumption of responsibility. Subsidiarity respects personal dignity by recognizing in the person a subject who is always capable of giving something to others. By considering reciprocity as the heart of what it is to be a human being, subsidiarity is the most effective antidote against any form of all-encompassing welfare state. It is able to take account both of the manifold articulation of plans — and therefore of the plurality of subjects — as well as the coordination of those plans. Hence the principle of subsidiarity is particularly well-suited to managing globalization and directing it towards authentic human development. In order not to produce a dangerous universal power of a tyrannical nature, the governance of globalization must be marked by subsidiarity, articulated into several layers and involving different levels that can work together. Globalization certainly requires authority, insofar as it poses the problem of a global common good that needs to be pursued. This authority, however, must be organized in a subsidiary and stratified way,138 if it is not to infringe upon freedom and if it is to yield effective results in practice.

135 John Paul II, Encyclical Letter Centesimus Annus, 5: Acta Apostolicæ Sedis [AAS] 83 (1991) 798-800; Benedict XVI, Address to the Participants in the Fourth National Congress of the Church in Italy, Verona, 19 October 2006.
136 No. 12.
137 Cf. Pius XI, Encyclical Letter Quadragesimo Anno (15 May 1931): AAS 23 (1931), 203; John Paul II, Encyclical Letter Centesimus Annus, 48: loc. cit., 852-854; Catechism of the Catholic Church, 1883.
138 Cf. John XXIII, Encyclical Letter Pacem in Terris: AAS 55 (1963), 274.

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