I am reading through the new “white paper” (I won’t dignify it with “document”) from the Pontifical Council for Justice and Peace and trying to keep my blood pressure down.
I have a few things to digest yet, and it takes me a while, since this isn’t exactly my bailiwick. However, I can say this: thanks be to God this “white paper” doesn’t form part of the Holy Father’s Ordinary Magisterium.
Every once in a while the Holy See’s smaller offices, Pontifical Councils and so forth, have to put out a paper to justify their budgets and remind everyone that they take up valuable space. These documents, which do not form part of the Holy Father’s Magisterium, can deal with critical issues like how to be a safe driver. The dicasteries keep busy by hosting seminars on how to play sport and so forth.
Some of my favorite points in the new “white paper” include the suggestion that there should be global monetary management and a “central world bank” to regulate it and that the United Nations should be involved. National banks have, after all, done such a good job that we should now make the effort transnational! And is this the same UN that had nations such as Saudi Arabia and, till recently, Libya on the their human rights commission? Wasn’t there a UN financial corruption investigation still going on? Is this the same UN that is pushing contraception pretty much in every poor country on earth? Was that a different UN?
Another high point in the new “white paper”: “These measures ought to be conceived of as some of the first steps in view of a public Authority with universal jurisdiction; as a first stage in a longer effort by the global community to steer its institutions towards achieving the common good.”
Uh huh.
In the presentation of the “white paper” during the Press Conference, Prof. Leonardo Becchetti (whom I assume was the writer) actually references Dodd-Frank as a starting point.
The MSM is gonna love this “white paper”. I can hear the intelligent, well-informed commentary about the Church even now. It’ll be along the lines of “The Pope says there should be a single world currency controlled by UN” and “Financial advice from people who have paid how many billion in settlements for abuse of children?”
If they can give us the “10 commandments for driving”, perhaps more helpful for our near future would have been pointers on, just off the top of my head, how to make a useful bug-out-bag, how to say the rosary with your family, how to barter things with real value, how to form small communities and help each other when the shelves in stores have been stripped bare, good programs for learning Chinese and Arabic, how to make hiding places for priests when the newly established domestic security forces start hunting them down, how serious liturgical abuses really are mortal sins, how to make a perfect act of contrition when dying without a priest during a global pandemic, what sort of silver and gold will be useful when our fake money no longer has redeemable value.
But, no, we get fantasies about the UN regulating a global monetary supply.
I’m being facetious, of course. The global economy is perfect, there are no super-bugs on a cyclical ascent, and we all love the direction governments are taking when it comes to religious liberty. Of course its a great idea for the Holy See’s office on Justice and Peace to further the cause of one world government.
Seriously, now that my blood pressure is dropping and my little raving nutty is over, I look forward to some good analysis of this “white paper” from the smart people at Acton Institute who might actually understand what the Holy See is proposing. From one conversation I had, I have gleaned that some of the analysis in the “white paper” of the present situation is okay, but the proposals are really bad.
UPDATE:
Be sure to read this about one of the people who wrote the “white paper”.
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Thus C. S. Lewis:
“Most political sermons teach the congregation nothing except what newspapers are taken at the Rectory.”
You need to look at this in a positive light Father.
Just think – if they hadn’t been busy ignoring most of the major news items for the past 18 months whilst considering their white paper they could have been applying their collective reasoning ability to things we might actually care about. Of course if the sheer intellectual brilliance of this document has impressed you then you may want them to consider things such as personal prayer, the liturgy, the persecuted church etc next.
After all what could possibly go wrong in that picture…?
Father, it’s right now the top item on Drudge, with scary pope photo included!
Just what we need, one world bank authority so that some nut in the UN can try to control us all! We all know the UN love Christianity, especially Catholicism. Then, the UN can use all of our money to push “reproductive” control to limit population growth.
I just saw this at Drudge and had my own rant about it. Thank goodness it is a mere “white paper.” Supra-national authorities have a horrible track record in peace and justice! I can’t imagine that the Holy Father thinks the EU’s central monetary policy has been too successful, much less its cultural policies that hurt the Church and her people.
If a joint/global bank is what it would take to not be bought out by China, then should we consider this? G-8, G-20? Or do we just bow now? I see what is upsetting, but what could be in the near future is more upsetting. Or so it seems.
From a political communications perspective, this is a disaster. I work at pretty high levels in conservative fiscal politics, and I have had to explain this away all morning. It’s a disaster.
Also, this confirms every nutty accusation fundies on YouTube have about the Church:
“The Vatican today called for a one-world government run out of the United Nations. It would be funded with a tax on everything you buy in financial markets. This supergovernment would start by controlling all the central banks in the world.”
What is inaccurate about that? Nothing.
It sounds like an anti-Catholic screed from the 19th century, but it’s true today! Thanks a bunch.
How’s this for a lede? Sandro Magister: “In the view of Fr. Thomas J. Reese, a professor at Georgetown University in Washington and a former director of the magazine of the Jesuits of New York, ‘America,’ not only is the document released today by the Holy See ‘to the left of Barack Obama, it [is] to the left of Nancy Pelosi, and it [is] closer to views of the “Occupy Wall Street” movement than anyone in the U.S. Congress.'” And this from a Jesuit yet!
Read it. It is really bad. A mixture of Catholic teaching and popular fiscal nonsense from, perhaps, European, or at least, Italian syndicalists, Macroeconomics a la Keynes, and a nod to Distributism.
The biggest problem I see in the document is the statement concerning the giving over of national sovereignty to a certain extent. “A supranational Authority of this kind should have a realistic structure and be set up gradually. It should be favourable to the existence of efficient and effective monetary and financial systems; that is, free and stable markets overseen by a suitable legal framework, well-functioning in support of sustainable development and social progress of all, and inspired by the values of charity and truth. It is a matter of an Authority with a global reach that cannot be imposed by force, coercion or violence, but should be the outcome of a free and shared agreement and a reflection of the permanent and historic needs of the world common good. It ought to arise from a process of progressive maturation of consciences and freedoms as well as the awareness of growing responsibilities”
Thankfully, someone put in a bit of realism: “A supranational Institution, the expression of a “community of nations”, will not last long, however, if the countries’ diversities from the standpoint of cultures, material and immaterial resources and historic and geographic conditions, are not recognized and fully respected. The lack of a convinced consensus, nourished by an unceasing moral communion on the part of the world community, would also reduce the effectiveness of such an Authority.”
Whatever happened to the concept of Original Sin?
And do the authors honestly believe that the oil-rich Arab nations would buy into this vision?
I think it is naive at best and dangerous at worst.
ps I have read the entire thing once and several choice parts more than once–it is really bad…
This really, REALLY disturbs me – on so many levels this disturbs me.
I think Our Lady of Fatima warned us of things like this. She said “various nations will be annihilated.” If this doesn’t happen by war, it will happen through global fiscal control.
Fr. Z: Excellent post !!! You need to be more widely circulated! Whoever gave rise to his ridiculous document in the bowels of the Vatican bureaucracy would do us all a favor and spend their time more profitably if they were in a monastery somewhere praying for the the salvation of souls. World economic authority operating out of the morally bankrupt UN???? Have they completely lost their mind?
My first thought on this paper was that it could seriously damage outreach to SSPX and disaffected Anglicans. It’s pretty bad. Two things would really help it: (1) a clear directive that all supranational authorities are bound to act virtuously and to promote virtuous acts on the part of all over whom the authorities have influence and (2) a clear recognition that one of the principal causes of the worldwide financial crisis is the genocidal level of euthanasia conducted against younger generations. Of course that paper wouldn’t get adulation from the infotainment business.
I think the Council Justice and Peace, should read the CCC paragraphs 1883-1885. Pseudo- Collectivism is how we got in this mess. Government policies like “to big to fail” for the banks is a prime example, if “moral hazard” was returned to the markets that would go a long way to controlling these abuses.
Father,
I just re-read your bit where the Dodd-FrankWall Street Reform Act was quoted by Becchetti . This horrible bill created the oversight council and other controls over banks, investments, and giving way too much power to the US Government, and the independent Federal Banks, basically taking away more power from the people. US citizens still don’t get what happened when that bill passed, as they still don’t understand the damage FDR did to the system. The new Office of Financial Research has absolutely no controls over it and is completely independent, plus it has new powers of data gathering, from banks, lending institutions, businesses, etc. I have a name for this sort of thing and the white paper mirrors this. By the way, I am also very concerned about the so-called independent rating groups, such as Moody, Standard and Poor, and Fitch. These groups have way too much power over the nature of investments and banking. In Europe, for example, just as the Italian banks were getting their act together and improving, Moody down-graded them, causing more instability. The recent devaluation of Lloyd’s caused the bank to cut pension funds immediately. This is not to say that there are enough funds if there were runs on the banks, but the speculation by the credit rating companies does not help.
I thought the Church believed in the principle of Subsidiarity. Where does a global bank fit into that? I hope the Vatican quickly disavows this paper. It should have been a real white paper – one with no writing on it.
I am sorry to say this, being in Europe, it is completely irresponsible for this type of so-called Catholic economic policy to be published at this time. This paper will cause more instability, rather than less here. And, here is the Government of Great Britain, trying to get out of the European Union,(good thing, too) stuck with now dealing this horrible paper from the Vatican. It is too much.
Why are people who love small localised government on the one hand, members of the most bureaucratic, centralised and hierarchical religion on the other? LOL
raitchi2
non sequitur
Because we are the one, true , holy and apostolic Church, created by Jesus Christ, who is GOD’s Son, the Second Person of the Blessed Trinity, we clearly see the difference between a God-made institution and a human-made institution, But then, one must have Faith, as well as Reason, to see this. From the outside, you must think the Church is merely created by humans-no, this is not so. As a Divine Institution it cannot be compared with the institutions created, hopefully, for the benefit of humankind, but seriously flawed, none-the-less. It is the very fact that we believe in the Divine Institution that we are wary of the others….Any global institution is an immediate threat to the Holy Catholic Church, which is another reason why this paper is so lame.
Fr. Z. You only scratched the surface with your mention of Justice and Peace Council. JPIC as it is known with offices in Rome is a left wing liberal organization with several orders of religious who subscribe to their membership. Many orders such as the Dominican Third order Fraternities will not belong as they don`t care to be part of a political liberal agenda. I have had the experience of publicly pointing out and going back and forth on the idea of voting for pro-abortion canidates for office who they support to further their left wing agendas. They have formed groups of “non-governmental” offices inside the UN to further pretty much what I read this morning when I got the Vatican News Service. One office in New York is run by and affiliated with an order, by a former community organizer from Chicago and a graduate of the Theological Union in Chicago.
This UN is the same organization that they are supporting who is in an unprecedented move to assist the European Court of Human Rights in a lawsuit challenging Poland`s strict abortion laws.
The same organization that killed thousands of people in Haiti by bringing in troops from Nepal and introducing cholrea to a country that never had it before. The most corrupt organization in the world that several in Congress are actually talking about de-funding. JPIC also sent a letter to Obama asking that he forbid local law enforcement to follow an act granted to them for detainment of illegal immigrants accused of a crime and co-signed by the ACLU, the Mexican Legal Defense Fund and the left wing liberal Southern Poverty Law Center. I pointed all this out to one of the people who are influential in the order and after an investigation they were de-funded though they are still afilliated with them and other orders. And since we are on a ranting roll here allow me to point out that the very type of global control they are suggesting is already in place and at this very moment, as mentioned in the article, in crises and on the brink of financial collapse. The EU, the Central European Bank, dosen`t have the money nor the backing to supply all the funds that are needed to bail out all the countries that are members, with emergency meetings now under way and the house of cards about to collapse with France, Germany and Britain for the most part ignoring the will of the voters in those countries, let alone the fiasco in Greece which is another story of what happens when you surrender your autonomy to a large governing power of which you have no control and only one vote. You would be surprised at how much influence this JPIC has with the Justice and Peace Ponitifical Council. And bear in mind, I have just scratched the surface. Pax.
This is horrible and yes, I agree with the person who brought up subsidiarity– there is a LOT of ignoring subsidiarity going on at all levels of the Church if the stuff being suggested for social justice is any indication.
I am just dreading with my husband gets home and reads Drudge…. ugh!
Tom T.
Why am I not surprised. The influences of the apostasy of the clergy and the infiltration of the communists, marxists and whateverists is coming to fruition. What I cannot understand is the continuing allowance of these types by our very holy and highly intelligent Pope. I would shut down the entire department (council).
What a disgrace. What a scandal. We must pray for the Holy Father and for Card. Turkson, who must have very liberal and (thus) very dishonest ghost writers. People who are either brazen liars or abysmally ignorant (although with liberals, or the OWS crowd that’s not necessarily mutually exclusive). They don’t even understand how taxation on transactions is already IMMORALLY high and produces more poverty for the weakest in the food chain, while killing the jobs they could have.
They ignore what Dodd-Frank did to the US and (thus) to the world economy? I don’t buy that for a minute. Something really bad happened here and I am sure there will be some kind of correction. As usual, one nobody will read and only after the damage is done.
The obscene idea that those hygiene-adverse, maggot-infested, stoned, racist, mostly rich and white marxist parasites might even remotely have a point and reflect something of Catholic doctrine is the only thing that offends me more than the dishonest comparison made elsewhere between them and the Tea party.
What a disgrace. What a scandal. I wake up at 5AM and work 2 jobs 16 hours a day to earn next to nothing thanks also to the immoral taxation of financial transactions which is killing trade and small businesses. I have a family to provide for and a world to fight and to re-evangelize. And what does these useless Pontifical Councils do? Give ammo to the enemy. I’ll better stop here…
Drudge Report already has this as the top, bold, headline story. So unfortunately thousands, if not millions of people will get to see the headlines on this today alone. What a horrible move to release this document.
raitchi2 says:
Why are people who love small localised government on the one hand, members of the most bureaucratic, centralised and hierarchical religion on the other? LOL
I have to preface my response by saying that to me a writer using LOL is someone who cannot resist the impulse to tell everyone that he is an idiot. The above remarks merely reenforce my opinion.
Ad rem:
1. The hierarchy of the church began in the Apostolic Age. This is known by anyone with the slightest familiarity with Scripture
2. The Church in Rome is not heavily bureaucratic. It runs with a skeleton crew.
3. The Church is anything but centralized. Each diocese and religious order has its own administration.
4. The Church claims authority over one thing–Scripture. Even the most empty headed Protestant has to realize that any positive reference to Scripture is implicitly a positive reference to the Catholic Church.
I read it and it seems pretty ” utopian ” to me. When Islam, Hinduism, Buddism, Shikism, Communism is willing to acknowledge the rule of law and are willing to guarantee religious freedom to all, including Jews, and that these freedoms will vigorously protected by their separate governments and all peoples of whatever nationality, ethnicity, color, sex, or religion will be treated equally and will not be discriminated against in any way then I migtht consider a ” global government. ” But I don’t think there is the sligtest danger of this ever happening. I suggest all those folks on the Vatican’s and the various Bishops’ ” justice and peace ” committees go out and get a job somewhere and leave us alone.
These crazy utopian ideas should come with a footnote that this would only be acceptable to the Church if the secular governments all give way to a global Catholic government. That would stop the liberals salivating over this.
JonPatrick says
I thought the Church believed in the principle of Subsidiarity. Where does a global bank fit into that? I hope the Vatican quickly disavows this paper. It should have been a real white paper – one with no writing on it.
Exactly. By definition, the concept of currency is local. And then there is the inept timing of publishing such a document while the Euro teeters on the edge . . .
Gramsci is all over this paper….
I’m wondering if this could be a reaction to the global empire the U.S. Government has been establishing in recent times, as it continues to depose legitimate governments of countries around the world.
I suspect that this may be because they do not want the U.S. Government to be in control.
Could it be that they see this as needed to protect the rest of the world from the United States?
RickMK,
The United States is not important in Europe. Europe is important. This has nothing to do with US power, which is really non-existent, in other countries. This is about the invisible government called the money interests, who hate the Church and are outside the normal frameworks of government-the Neo-Gramscians, the powers against state-hood. Europe sees more clearly than the US who is really in charge. America is no longer consider a world power in the way it was four or five years ago. The real power is in the IMF, World Bank, Muslim Brotherhood, Saudi Kings, etc. China is not even considered here a number one player anymore, as the banks there are in trouble as well. Sorry to disillusion you, but Europe no longer looks to America for anything but platitudes.
It is an inconvenient truth that ignoring subsidiarity is common and widespread for many within the Church. The peace and social justice communities more or less dismiss ‘subsidiarity’ as insignificant to their mission and also threatens their soft and often utopian view of open borders vs private ownership of land (individual sovereignty in a democratic state).
Why in the name of Jesus, would the Church want to inspire a global financial government? It indicates clearly these groups reject the teaching of subsidiarity and are agitating for a global state governance (anti-church heretics).
This white paper fluff piece is released by a progressive cabal with full intent to pile on and support the OWS agitators, and to further divide Catholics away from the true teachings of the magisterium. I wager that much of this is aligned with Obama’s 2012 presidential election. The democratic party regime and their cronies know all too well how to pull the Alinsky seamless carpet out from under the faithful.
I really no longer see much of this as emanating from the “left” or as “liberal” or “progressive” as decent label. I just do not see why loose collections of various positions deserve broad categorization according to ideology when one cannot easily trace or reconstruct the ideals upon which supposedly based. That particular political party adopts this or that cannot really be connected easily to morals, ideals, or the Church’s social justice magisterium anymore at all it seems and in many instances that one or another party adopts this or that as platform or position or advocacy depends not at all on consistent ideology but on numerous other regrettable and destructive factors.
benedetta, see my comment on the other thread re: influences and Gregg comment. This all can be traced.
With all due respect, father, how is what the white paper suggests any different from what Pope Benedict XVI himself suggested in Caritatis in Veritate (67)? I quote: “To manage the global economy; to revive economies hit by the crisis; to avoid any deterioration of the present crisis and the greater imbalances that would result; to bring about integral and timely disarmament, food security and peace; to guarantee the protection of the environment and to regulate migration: for all this, there is urgent need of a true world political authority, as my predecessor Blessed John XXIII indicated some years ago. Such an authority would need to be regulated by law, to observe consistently the principles of subsidiarity and solidarity, to seek to establish the common good, and to make a commitment to securing authentic integral human development inspired by the values of charity in truth. Furthermore, such an authority would need to be universally recognized and to be vested with the effective power to ensure security for all, regard for justice, and respect for rights. Obviously it would have to have the authority to ensure compliance with its decisions from all parties, and also with the coordinated measures adopted in various international forums.” I very often appreciate your comments, father, but there are times when it feels perhaps that your political opinions sometimes cloud your reading of Church teaching. I could be wrong, though.
Re: “various nations will be annihilated” —
When Scripture speaks of “nations,” it generally is talking about (Gentile) ethnic groups and tribes, or possibly about speakers of the same language. It’s not talking about countries, per se. When it comes to political divisions, the Bible usually starts talking about kings and kingdoms, empires, and so forth.
Now, WWII did pose a serious survival threat to many ethnic groups (particularly Jews, Slavs, Roma, small USSR ethnic groups, etc.), both by way of getting killed and of getting dispossessed and resettled far away from everybody else in their ethnic group. The rest of the twentieth century continued this trend (which began before Fatima), and so does the twenty-first in places.
Anyway, my point is that that Fatima-type prophecies mentioning “nations” are more about Lombards and Burgunds, not Lombardy and Burgundy.
re: “depends not at all on consistent ideology but on numerous other regrettable and destructive factors”
I agree that ideology factors are not consistent in getting to root causes of issues threatening the teaching of our church, but, sometimes they are very consistent, and we cannot dismiss the grouping (if it quacks like a duck, ….). Example, in the US, this current extreme leftist regime is on a well documented mission to force the church to bow as a servant to state social engineering (socialism). Do we just ignore their brazen ideology and pretend it is not what it is?
Supertradmum, Yes I read your comments on the other post and I don’t dispute the connections you relate between certain individuals’ deeds. However at the end of the day I can’t really bring myself to say that what animated the various actions of Marx, Lenin, Alinksy constitutes legitimate ideology. The evidence is in and by their fruits…What it is about their thinking that meshes nicely with Catholic social justice is really at this point pretty much lost. Of course unbridled capitalism doesn’t seem to be a friend of Catholic social justice either. Let’s put it this way, just because certain people who agree with Lenin and Alinsky’s various tactics, deeds, and rhetoric might also appreciate some of what is in this white paper doesn’t really make it leftist or liberal. Unfortunately, it becomes something, else.
RickMK says:
I’m wondering if this could be a reaction to the global empire the U.S. Government has been establishing in recent times, as it continues to depose legitimate governments of countries around the world
Correct. We deposed the legitimate Nazi govt of the Third Reich via WWII. Thereafter, through Cold War efforts we deposed the legitimate Communist govts of Poland, Hungary, and Czechoslovakia.
The bank part is ill informed and won’t address any real problems. However the political part seems to simply be a call for a new Holy Roman Empire. Cut the “we need democratic approval for legitimacy” lines and make it clear that the secularists have no place in such a model and it’s quite nice.
Good grief, what a useless load of bile I read here! Is this a way to treat a document coming out of the Vatican? I really am shocked.
I know it is not a comparison that people here will like, but I think it is the perfect mirror-image of the reaction one would get from Liberals if, say, the CDW were to release a study document proposing (not imposing) more common use of ad orientem worship:
‘The MSM is gonna love this “white paper”. I can hear the intelligent, well-informed commentary about the Church even now. It’ll be along the lines of “The Pope says world will be saved if priests face the other way.”’
“Thank goodness it is a mere “white paper.” Vatican authorities have a horrible track record in promoting proper liturgy.”
“Read it. It is really bad. A mixture of Catholic teaching and popular pious nonsense from the likes of the SSPX and Sedevacantists.”
I know this type of document is prudential, not Magisterial, blah blah. But the same would go for non-binding encouragements of ad orientem, Communion on the tongue, Latin in the liturgy, etc. I don’t think these types of reactions set a particularly good example to Liberals of docility and open-mindedness towards ecclesial documents.
I am just not sure that in places where the Holy Father and “The Vatican” are so derided to begin with that even assuming the non-magisterial proposals to be of great value, the fact is that the erosion of basic regard for “The Vatican” by msm, by certain elites and officials, that now when they call for Catholics to get behind this document at the polls it would be difficult to then suspend disbelief…One can see why the dignity of all human life which serves as the basis for Catholic social justice teaching is magisterial whereas on other points, given modern history, reasonable minds may disagree as to the merits.
Are these just natural extension of what Lenin was about, what Alinsky dedicated his rhetoric to? To what extent can we purify those actions and separate out “good ideas” from what was totally destructive.
And no, Gideon Ertner there doesn’t seem to be any ability to equate reception of Communion on the tongue, Latin in the liturgy, ad orientem celebration of the Mass, to, take it or leave it as to this white paper. If you want to call it ideology, well ok but still I fail to see the worthwhile connection between, Lenin, and Alinsky, and their rhetoric and aims, deeds, and, Catholic social justice (which of course is never a matter of mere ideology) and that ain’t no bile. If you can demonstrate though, feel free we are all listening.
I really don’t see what is people’s beef with this document, unless you are an extreme Economic Liberalist, in which case you can hardly lay claim to being a Catholic. The document attacks unfettered Liberalism in economic matters (as did Leo XIII and Pius XI) and reminds the world that all economic activity is moral activity and is governed by the moral law. Hence also transnational economic activity. However the lack of an authority that can control transnational economic activity is certainly a conspicuous lacuna in the make-up of the contemporary world – similar to if Interpol did not exist. Tell me how can a Catholic be against setting up such a system?
As for the idea of a world government, of course that is not without its problems, but may I remind that it has been soundly endorsed not only by at least two Popes (John XXIII and Benedict XVI) but also by that bastion of orthodoxy, Alfredo Cardinal Ottaviani.
Au contraire, Gideon.
This document has nothing to do with the Church or worship. It is a muddle of half-baked economic and political concepts, poorly expressed, which do not particularly reflect the teaching office of the Church.
A better analogy, from a political liberal’s blood-pressure-raising perspective, would be if the Church issued a “white paper” proposing to solve the country’s economic problems by imposing a Flat Tax, or Herman Cain’s 9-9-9 plan. Unless the Council on Justice and Peace got some competent economists on board who could actually discuss the factual merits and demerits of such a plan, either proposition is just as stupid.
I don’t have to be open-minded or docile towards a ‘prudential’ document that is completely lacking in factual basis and well beyond any known area of expertise within the Church.
Of course it is the unbridled consumerism and the Catholicism styled as secularism which has made abortion the harsh reality it is today, and justifies its legalisms. It is no shocker that Catholic social teaching can’t applaud that state of affairs in countries with the supposedly capitalistic systems at work. But at the same time because unchecked consumerism has fed the culture of death it does not mean that other state sponsored cultures of death necessarily have the right ideas to inform for human rights and how we are to go about ordering our lives with one another.
As far as the disparity between certain countries as compared with others, perhaps the area of debt relief still must be addressed.
It seems that it is not what this white paper says or does not say but the big thing as usual with our consumerist media driven culture is who claims it for themselves and wields it as a weapon against others, trying to associate it with whatever is desired. I don’t read it as intended that way and Fr. Z posted a reasonable critique from someone qualified to speak to its content (probably not many of us actually fit that qualification). The msm rendition pretends that the secular context is the only one with meaning.
Who appointed this guy to write this drivel?
I think our Catholic leadership has to move away from this New World Order stuff. If you will recall, Pope Benedict’s XVI paragraph 67 of “Caritas In Veritate” also stated that there is “an urgent need for a true world political authority.”
Also, the Holy See makes itself look somewhat incompetent when it offers document after document after document on every topic under the sun. These documents often contradict each other, are ambiguous, or contradict earlier established magisterial teaching. This only confuses the faithful and gives ammunition to the Church’s enemies.
The PCJP has a long history of releasing “out there” documents. JP II really did a lot to reign them in, and I think they are exercising a certain freedom that they have now that Benedict is Pope.
This paper is totally non-binding on our consciences, so calm down. Fr. Z is setting a bad example here, and allowing his own politics to sow a bit of disunity in the Church. Breathe folks. Its just the PCJP. They always do this. What do you expect them to do? Endorse lassez-faire and the end of unions? That’s like expecting the “Vatican” to endorse U.S. foreign policy. The Church isn’t going to speak against the rights of the poor and in favor of wars. Not now… not ever.
AND, I might add, there are probably some VERY GOOD pro-life traditional Catholics whose economic politics runs left of center. See the staunchly democratic and staunchly pro-life candidate Fr. Z talks about in a more recent entry. Don’t have a short memory. It wasn’t too long ago that being Catholic MEANT being a Democrat and a social justice progressive. Go back to the 1930’s, 40’s, and 50’s and try to find Catholic voices against unions, guilds, and in favor of unfettered Capitalism. You won’t find many…. at all….
“It is a muddle of half-baked economic and political concepts, poorly expressed, which do not particularly reflect the teaching office of the Church.”
In your view, that is.
“…completely lacking in factual basis and well beyond any known area of expertise within the Church.”
Huh???
It is not a fact that there are not now any global structures capable of solving the current international financial crisis?
And it is not within the expertise of the Church to propose ethical lines of development for a global economic system?
Look, what the PCJP does is merely propose some guidelines and considerations for a development of the global economic system along lines consonant with the social doctrine of the Church. This development will come in some way or other, and the PCJP thinks they can nudge it in a Christian direction. I’m not holding my breath, but kudos to them for trying.
Now of course, when the PCJP issues a strong document calling for an end to all abortion and for the rights of the unborn to receive international recognition… then I’ll be defending them much more vigourously.
My chief comfort is my lack of expectation that anyone I have to deal with will read it.
“These measures ought to be conceived of as some of the first steps in view of a public Authority with universal jurisdiction.”
Sounds to me like the Pope. ;)
Sadly, there is more than this Pontifical Council that has subtle and ever so gentle efforts to take the Church further to the left of liberal. I site for example the document that came out on July 10,
2011 from the Vatican`s Council for Inter-religious Dialogue and Undersecretary of the Pontifical Council Msgr. Andrew Tany-anan that was sold as an effort to reduce violence and warned not to use violence or inducements to convert non religious or other religions. It is considered ground breaking in that it states; “We cannot impose on anybody to convert, so we give them time to reflect.” Create your own guidelines, missionaries are told. The vast number of Catholic Martyrs
who were tortured and killed since the second century must have been all wrong. Not the way to do it folks. “Catholicism is a gift from God,” according to Msgr. Tanya-anan. In other words you either got it or you don`t. Don`t tell me about how open minded and receptive we should be about discussing positions with liberals. If you don`t know by now that it is their way or the highway you haven`t been into some very serious discussions. If you have any doubts about this, just read the National Catholic Reporter and paricularly the comments that follow. Oh, and don`t even try to post a conservative view, they won`t allow it. I tried. In defense of Fr. Z, allow me to just say Fr. Z is not dividing anyone. The Church has been for along time seriously divided and may I remind all here that you never heard the rants and crying and name calling from traditionalists when we had to attend the really bad Novus Ordo Masses that we have been subjected to for a long time like you do from liberals today complaining about the direction of the Church with regard to Universae Ecclesia. And let me just say that many of the cherry picking that comes from various interpretations of Caritas In Veritate is from the Pope trying to appease, in my humble view, both sides of the Church. A dangerous and non-productive way to go, but commendable and Holy way to go to keep both sides, liberal and conservative, together. You can actually draw and cherry pick from whatever side of the argument you happen to be promoting there is something in there for everyone. Benedeta, I am afraid to say it, but they are not going to be able to address the debt of other countries who have gone to the other extreme of welfare state to replace capitalism such as
Greece which has a debt to GDP ratio of almost 200% and Italy whose debt is 120% of gross domestic product. No bank in it`s right mind is going to lend them anymore bailouts without high interest rates which will almost guarantee their inability to pay back the loans. The EU is a ticking
fiscal financial time bomb about to meltdown. And you know what? There is nothing they can do about it but maybe prolong the inevitable. Pax
Father,
I wouldn’t worry about this document that much. All it really calls for are some pretty modest measures. This supposed world central bank really just sounds like a modernized version of the IMF. The IMF served an important role when we were fully under the Bretton Woods system. Now, it’s become kind of obsolete.
Obviously not everyone is going to agree that such a thing is a good idea, but it’s really nothing all that radical.
Is usury still a sin?
“Fr. Z is setting a bad example here, and allowing his own politics to sow a bit of disunity in the Church. ”
On the contrary, I think Fr Z has set a great example with this expose. I wish to see Vatican officials who’re assigned to the place as a means of promoting Catholic faith in the world in practical and intellectually helpful ways. I have little interest in reading more half-baked documents from some well-intentioned people. If they don’t know what they’re talking about, they honestly don’t belong there.
“Don’t have a short memory. It wasn’t too long ago that being Catholic MEANT being a Democrat and a social justice progressive. Go back to the 1930?s, 40?s, and 50?s and try to find Catholic voices against unions, guilds, and in favor of unfettered Capitalism. You won’t find many…. at all….”
If I may be so bold, this statement explains why I abandoned the Democrats and “social justice” concerns a long time ago. For my purposes, most of these efforts at unions, guilds, political parties, and whatnot have accomplished little useful for the average worker. If anything, I’d say they’ve given the average worker a serious setback.
No union or guild contract will ever enable a person to discern the best opportunities to use their talents. No legislative act by the federal or state government can ever give a worker dignity. If workers truly wish to be dignified and earning enough to make an honest living, those workers must educate themselves to understand how the business world works and how they may use their God-given talents to the greatest impact to improve their lives.
If anything, I think unions and guilds tend toward being every bit as abusive and corrupt as the business or government interests they theoretically aim to oversee.
For what it’s worth, I’m not the least bit convinced that various political or social justice movements have ever done more than paste a rosy veneer over the serious abuses being heaped upon people. I don’t think they’re capable of doing anything more virtuous.
I also have never been persuaded that genuine Catholic social justice ideals have ever dominated this nation. But that shouldn’t be a surprise. This nation was sternly Protestant all the way from the founding of most of it’s colonies (Maryland the notable exception there), through the Revolution, and certainly through the Constitution being ratified. We’ve never been terribly Catholic since then either.
Is it any wonder then that our nation’s policies reflect a degree of fallen nature?
As the saying goes, you can’t give (or live) what you haven’t got in the first place….
To all of you complaining about this document…it appears to be in perfect harmony with the (infallible – ?) teaching of the Second Vatican Council document Gaudium et Spes, paragraphs 83-90, especially paragraph 85. (Or is it okay for you to “reject the Council” ?)
http://www.vatican.va/archive/hist_councils/ii_vatican_council/documents/vat-ii_cons_19651207_gaudium-et-spes_en.html
If St. Thomas Aquinas were here, he would point out that Central Reserve Banking, and Fractional Reserve Banking, in their very essence, are theft. That is what the thing is.
In Central Reserve Banking, one group of people in a society is given permission by the government to counterfeit money. The only difference between a criminal counterfeiter and a central banker is that the central banker is approved by government. They both do the same thing. They create money out of thin air.
When money is created out of thin air, there is a transfer of wealth from those who have previously saved money towards those who get the new money first. Those who get the new money spend it into circulation, pushing up the prices of whatever they buy. Those who get the new money second, push up the prices of the things they buy. Those who get the new money late in the “game”, or not at all, find that the prices have already risen. They lose the value of their savings, in exactly the same way they would if a criminal counterfeiter printed new money and spent it.
In Fractional Reserve Banking, a bank is not required to keep your deposit on hand; they keep only a “fraction” of your deposit available. An example will illustrate. Suppose you deposit your $1000 paycheck, and suppose the reserve ratio is 10%. The bank keeps $100 on hand, and loans out $900. Suppose Charlie borrows it, because he wants to buy a car. The man who sold Charlie the car now has $900 and deposits it into the banking system. That bank keeps $90, and loans out $810 to Barney, who wants to buy a boat. The man who sold Barnie the boat deposits it, and his bank keeps $81 and loans out $729. This process continues until the amounts are vanishingly small. But they add up. Notice that you (it was your paycheck) have a claim on $1000, but it isn’t in the banking system. Your bank doesn’t have it. The man who sold Charlie the car has a claim on $900 from his bank, but it isn’t there; his bank doesn’t have it. The man who sold Barney the boat has a claim on $810, but his bank doesn’t have it. The banks, by fractional reserve banking, are also creating money out of thin air, and committing fraud. This is counterfeiting just as surely as if they were running a printing press!
There are only three ways to have money: (1) work for it — exchange something for something, or (2) receive it as a gift or inheritance (somebody else had to earn it, exchanging something for something), or (3) steal it (exchanging nothing for something). There are no other options. Counterfeiting is exchanging nothing for something; that is why it is immoral — that is why it is theft.
Both central reserve banking, and fractional reserve banking, are effectively theft. As such, they are intrinsically immoral. The bishops will ruffle some feathers for telling the truth, but they must tell the truth. That is their job. They have the moral authority, and a special charism from God to do this. If they do not declare the truth, they are failing in their mission to communicate the truth about Faith and Morals to the world. I strongly urge all of the world’s Christian bishops to do their job. Please declare central banking and fractional reserve banking to be intrinsically evil. (Theft is intrinsically evil, isn’t it? It’s against the 10 Commandments, isn’t it?) Please do your job.
Lord Have Mercy,
Ken Hendrickson
PS The immense suffering around the world currently being experienced, as we go through this “Greater Depression”, was directly caused by the central bankers and the fractional reserve banking system. It is a great evil; the amount of suffering caused by this system staggers the imagination. The lowest spot in hell is probably reserved for Central Bankers, not lawyers. And Jesus’ prayer, “Father, forgive them, because they do not know what they do”, does not apply. The banksters do know what they are doing.
Great post, Father. The really interesting part of your rant is the section where you suggest topics that these Pontifical Councils could actually provide some guidance, et. al., “how to make a useful bug-out-bag, how to say the rosary with your family, how to barter things with real value,”, etc. I have been wondering about how to go about creating a priest hole in my home just in case. I am certain that we are rapidly approaching just such a time.
@muckemdanno: Agreed! Reading Fr. Z. say “thanks be to God this ‘white paper’ doesn’t form part of the Holy Father’s Ordinary Magisterium” reminded me of Gaudium et Spes‘s wish for a global authority, too.
muckemdano,
See my comment on the other thread.
The offices in Rome need to knock off the politics. The Church’s job is to convert the world to Christianity.
“It wasn’t too long ago that being Catholic MEANT being a Democrat and a social justice progressive. Go back to the 1930?s, 40?s, and 50?s and try to find Catholic voices against unions, guilds, and in favor of unfettered Capitalism. You won’t find many…. at all….”
It appears as though something I wrote in response to this earlier..seemed a little too problematic somehow, so let me state it this way:
I remember hearing a great deal about the virtue of unions and guilds when I was younger. I’ve become very skeptical about whether they truthfully help solve problems.
In general, I understand the intent of a union thus: Enable or require workers to bargain collectively with one or more business interests. By doing so, we ensure that business interests will be required to offer wages and/or benefits to laborers that will both allow the business to earn some amount of profit AND require that the business treat it’s laborers with dignity.
It’s a reasonable intent, but I’m VERY skeptical about the results we’ve achieved. All too often, human dignity becomes more a political football to be exploited by either side than a legitimate concern to be addressed.
Stated somewhat more plainly, I’m thoroughly disgusted by the frame of mind that a union tends to induce. Unions, whether they intend so or not, tend to give the impression that labor can trust ownership and/or management only IF the union can impose a minimum wage law or a threat of a labor strike. Unions appear to assume that laborers won’t be treated fairly otherwise. I’ve long been horrified by this because it seems to me that labor can’t expect management to be fair if labor assumes sinful intentions from business from the get-go. If you behave as though a man can only be trusted to look at you as a human being IF he’s forced to look at you, there’s little chance you’ll ever mutually trust each other, nor see the other in light of the Holy Spirit.
From an somewhat more intellectual standpoint then, I see little virtue coming from union effort.
I tend to think that if we wish to see this nation better acknowledge the needs of both business and labor, they need to approach the problem with even the same ultimate goals in mind. Beings this can’t happen very easily when everyone comes from differing spiritual backgrounds, I’m inclined to think that we can’t solve the problems of business vs labor–union or no union–until we evangelize the nation to bring everyone to be Catholic.
Otherwise, there’s no real mutual accountability amongst differing parties.
I stopped reading when he mentioned the Tower of Babel.
My thinking is, they want to build a bigger one!.
This is embarrassing, crazy, obscene and any other negative adjective you wish to add.
They so need our prayers.
Well, personally, I spent a lot of years listening to Rush Limbaugh. I flew my flag and cheered when the US got into our mid east wars. I thought Fox news was pretty cool. I owned a business and was convinced that the government was the source of all my problems, while at the same time, I worshiped the good old USA. I voted for dubyah the first time. I was in a word : fat, dumb and happy. Last time I worked for Ron Paul. Then a funny thing happened. I came back to the Catholic Church after being gone 23 years. I read among other things the documents that form the Social Doctrine of the Catholic Church. Funny thing that both of out major political parties pursue policies that are in conflict with the Church. Hmmm. How could that be? I think, I’m gonna put a copy of this white paper in the reading room and think about it a little more before I jump all over it. Remember that there was and still is outcry against Humanae Vitae. It was an encyclical granted and not a “whit paper”, but waist not prophetic?
The UN? Isn’t the UN the same agency which takes all the good parking in east midtown? They make it very difficult to get to Mass at St. Agnes on Sunday, because all the parking is allotted to the UN! If they do banking the same way they bogart the parking, I think this is a really bad idea.
Muckedammo said
“To all of you complaining about this document…it appears to be in perfect harmony with the (infallible – ?) teaching of the Second Vatican Council document Gaudium et Spes, paragraphs 83-90, especially paragraph 85. (Or is it okay for you to “reject the Council” ?)
Vatican II makes a number of comments about measures that would “seem useful”. I would answer that history has proven that what “seemed useful” in the early 60s now is clearly useless. After all the organization which the current idiotic statement suggests be given more power ( A would bank operated in some fashion via the United Nations) is the same organization, that is the United Nations, that declares abortion a human right. If I recall correctly Vatican II called abortion an “unspeakable crime” Had the fathers of Vatican II known that the international community as represented by the UN would advocate “unspeakable crimes” as human rights perhaps they would have rethought what “seemed useful” at the time. The council is not infallible in making suggestions about what “seems useful” It may have “seemed” one way or another and events may later prove what “seemed” true was in fact wrong. This applies to much of what went on at Vatican II.
This isn’t the first time this sort of thing has come from the Vatican. In 2009, Pope Benedict generated similar comments:
http://www.reuters.com/article/2009/07/07/us-pope-encyclical-idUSTRE5662VM20090707?rpc=60
“The offices in Rome need to knock off the politics. The Church’s job is to convert the world to Christianity.”
So the Church should not advocate to ban abortion? That is certainly political.
“Unions, whether they intend so or not, tend to give the impression that labor can trust ownership and/or management only IF the union can impose a minimum wage law or a threat of a labor strike.”
Granted, it is a virtue to trust one’s fellow men, but given the horrendous conditions that the working class lives under in many nations (while their bosses live as royalty), as well as man’s natural propensity to avarice, I’d say it is quite understandable that workers work from the assumption that their bosses tend to screw them if they can get away with it.
Ken.Hendrickson,
Calling fractional reserve banking “theft” is a big stretch. The bank provides compensation, in the form of interest and in the form of their services, in exchange for the ability to use your money while it sits in your account.
MikeM,
Well no, calling fractional reserve banking theft is calling a spade a spade. For a really chilling view of the reality, read Murray N. Rothbard’s excellent The Case Against the Fed. Rothbard, a gifted economist and protege of Mises lays it all out with stunning clarity.
As a person who holds a masters in Economics and Finance. I can say with certainty that the Austrian thesis surrounding central banking and regulation is COMPLETELY dismissed by all mainstream and most legitimate heterodox economists.
There is no evidence that the material progress of our world has in any way been hindered by the advent of Central Banks. Just look at the history of growth in the world and look at countries who do not have central banks today and you will see what I mean. The proof is in the pudding and how we have more of it.
Economics is a “kept profession”.
I only see that you are in denial, and cannot do logic very well. It could be the case that the conditions which lead to economic growth and prosperity have occurred coincidentally with the evil of Central Banks, leading to the observation you have made. However, we must ask the question: how much better off would we have been if we lived in the better world — identical to this one in every way — except without Central Banking and Fractional Reserve Banking? I submit, as a matter of simple logic, that if you are not continuously the victim of theft, you will do better.
Central Banking is institutionalized counterfeiting. It is giving a particular group in society, the banking cartel, a “privilege” that other members of society do not have — allowing them to commit fraud and engage in counterfeiting for which anybody else would be severely punished.
All animals are equal, but some animals are more equal than others.
Lord Have Mercy,
Ken Hendrickson
PS Bishops, where are you?? Why the silence? Please do your job, and declare central banking and fractional reserve banking to be morally evil. You will have to answer to God for your sins of omission.
Ken,
Thanks so much for your entry. This is a serious situation. People here in Europe are talking about this as a fiat for a Global Bank. Scary stuff. Either Catholics are like children and simply do not get it, or they are socialists and communists themselves…..No reason for ignorance here.
The Austrian group and the Italians who I have recently read are far left of anything we conservative Catholics would expect. The rot is far gone here and the lay influences on the Vatican have done us great harm. I am afraid that some of the Cardinals, who are from countries where socialism is desired, have also fallen for these lies. Thank you so much….
Supertradmum and Ken. I agree and thank you. I could not have said it better.
After all though, lets face it, we were warned all this would come about. Pax
Ken,
The Austrians have completely confused the cause and end of money. They believe that when the Central Bank issues currency that the Central Bank is the institution that CREATES the money. However, there is NO evidence that Central Bank is even capable of controlling the money supply, or even how we go about measuring what money is. If inflation truly is the result of the Central Bank issuing Fiat currency QE1, 2, and 3 would all have created enormous amounts of hyperinflation in the economy, because the Federal Reserve’s balance sheet expanded into the trillions and trillions of dollars. But the evidence corroborated the opposite claim, deflation.
Austrian economics only legitimate contribution has been its criticism of econometrics, which has been important. But Lew Rockwell, Ron Paul, Jefferey Tucker and others only cling to their ridiculous theory because it happens to jive with their political libertariansim. They refuse to admit actual empirical evidence because they know the sorts of havoc that would inflict on their precious economic fantasy.
Tina in Ashburn says:
Is usury still a sin?
It depends on what is meant by usury:
1. If it means lending money at interest for someone to buy necessities of life, e.g., food, yes.
2. If it means lending money at exorbitant interest for anything, also yes. NB: States in the US commonly have usury laws that prohibit lending above a certain percent. During the Carter Administration, when inflation drove interest rates high, those laws had to be revised.
3. If it means lending money at interest in an expanding economy, no.
mbutton,
You are still in denial. Furthermore, your great learning has driven you mad. (Acts 26:24)
Lord Have Mercy,
Ken Hendrickson
Whether or not Central banking is a bad thing or a good thing is an empiric question that can not be settled by reference to “moral arguments”. it must be settled by reference to data, evidence . this evidence is not clear cut, since like most social science data, there are multiple factors which contribute to a given result. I think there has been debate as to the specific causes of the Great Depression for some time. It is unlikely there is one clear cut cause .Because of the nature of the question, it is mostly a technical one, based on how one reads historical and economic data. As such two people of good will, both seeking to be faithful to the Church can disagree. much like to equally devout Catholic physicians might disagree on whether a patient with a complicated cancer would benefit from chemotherapy “regimen X” or Chemotherapy “regimen Y” . The answer depends on how each oncologist would weigh the data. Thats why the Vatican recommendations are so problematic, it is not jsut that they are bad policy, its that the nature of the problem ( the economic collapse) while there is a moral dimension, and tradtional moral principles preventing fraud still apply, the specific goverment policies that migth prevent this kind of thing is not mostly a moral question, it is an economic one that the Vatican has no intrinsic insight into.
Yes we all know the “you are in denial” argument is particularly powerful.
Can you explain why we do not have hyperinflation currently given the Federal Reserves quantitative easing?
Thank you Mdepie for your thoughtful response. You critique about the problems with data collection and regressions are important, and ones I take seriously. Which is why I tried to formulate my argument around historical precedence rather than any fickle statistics.
Your analogy is an excellent one, Mdepie, far more clever than one I would point out. Because Mr. Hendrikson would like to have us watch the patient get eaten alive with the cancer before we try to treat the problem. If he was astute to his tradition he would probably cite something about natural equilibrium and business cycles. Indeed, He would have us believe that cancer provides a solution to its own problem, perhaps death is the satisfactory solution. The whole problem with Austrian economics is its unnatural belief in the goodness of “natural” economics as being inherently self-equilibrating and optimal.
The Roman Curia opposes Marxism for the same reason it opposes Laissez-faire economics, because it concentrates power in the hands of the few at the expense of the many. Both economic philosophies underestimate the failings of human nature, and ignore the fall.
No! Before you can judge whether something is good or bad, you first must know what it is. Things are not good or bad based upon their results — that is the fallacy of “the end justifies the means”. Rather, things are good or bad based upon what they intrinsically are.
Where did you learn your moral values, Mdepie? The Church? Perhaps the bishops have even more to answer for. Or perhaps you weren’t paying attention.
Central Banking is — in a nutshell — legalized counterfeiting. Counterfeiting is theft; that is what it is. It did not become good just because the government made it legal, just like abortion did not become good when the government made it legal.
Sigh. I hesitate to answer this because you are avoiding the main point. But I shall answer in order that you cannot claim I am not addressing your questions. We have already had hyperinflation. (You use terms badly. Inflation is an increase in the supply of money and credit. You should have asked why we don’t have price increases yet.) We have not yet had price increases because the banks are insolvent and they are not lending. They are storing their money as excess reserves at the Fed. Future price increases are baked into the cake; they are coming; they are inevitable. And that is how the theft is accomplished. The taxpayers were forced to bail out the failed banks and their bondholders through the evil of Central Banking. The elite banksters who made bad investments and their bondholders have been made whole, but the savers will eventually be wiped out; their wealth has already been taken from them by counterfeiting.
Common simple people can understand that if one group of people is allowed to create money out of thin air — to counterfeit — then that group of people has been given a license to steal. But that license does not make theft morally acceptable. It’s amazing what educated economists cannot understand when they are paid to not understand. Or rather, it’s not amazing at all. It is sad and tragic.
I am purposely limiting myself to pointing out the elephant in the living room. Central Banking is, in its essence, theft. Fractional Reserve Banking is, in its essence, fraud. The first step towards an honest and moral monetary system is to abolish those great moral evils.
Mbutton, I urge you to repent, while there is still time.
Lord Have Mercy,
Ken Hendrickson
PS Bishops, I beg and plead that you stop ignoring the elephant. It is your job to say what I am saying. Why aren’t you doing it?
PPS In any future replies, please stick to the topic: the essence of what central banking and fractional reserve banking are, and the moral qualities thereof.
Ken,
As you know, this has already happened. “The elite banksters who made bad investments and their bondholders have been made whole, but the savers will eventually be wiped out; their wealth has already been taken from them by counterfeiting.” As I mentioned somewhere else, the European banks have about 20% of the euros needed if all savers and account holders came and ask for their money today. The entire set-up has been fraudulent, at least since the World Bank (UN Bank), The European Central Bank, and others have been in existence. The elephant is so much part of the room people have accepted the premises which will destroy their nation-states.
But of course, Father, one need remember that “the smart people at the Acton Institute” come from one school of thought about economics. Their understanding of what the Holy See is suggesting need not be the only, or even the best, understanding of it.
To deny that would be to fall victim to the “economic apriorism” the white paper refutes.
This morning in Parliament in GB, George Osborne says” Britain won’t be paying be paying into the eurozone bail-out fund (the EFSF) through its contributions to the IMF, because the IMF can’t put money directly into the EFSF.
The IMF can only pay money directly to countries which have an agreed bail-out programme in place,” says the Chancellor.
from the Telegraph–“That undermines reports yesterday that said the IMF was thinking of investing in the special purpose investment vehicle that the eurozone nations want to set up as part of the EFSF.
So it’s up to sovereign wealth funds and private investors to put their cash into the SPIV…”
Britain’s idea is also there are the real poor and then the poor who will not work: Spain, Portugal, Greece, etc. Again, standard central banking takes no account of those who think a four day work week is fine, compared with those who work harder. As one of the Maltese men said to me yesterday, “Germans like to work”. Well, I thought we all were supposed to work.as St. Paul states in Thessalonians.” If anyone is not willing to work, let him not eat” American youth will not do the work the Mexican immigrants are willing to do and this is true is some of the “entitlement” countries mentioned above. Why doesn’t Rome write about that? Western culture has created a huge class of people who expect others to pay their way without being sick, or having catastrophes. If all of Europe wants the same lifestyle, then there must be responsibility to work and not socialism. The Third World Countries are a different story, but the work ethic should be the same. The Church through the last twelve Popes have condemned socialism. What has happened?
We have already had hyperinflation. (You use terms badly. Inflation is an increase in the supply of money and credit. You should have asked why we don’t have price increases yet.)
No your definition assumes that increases in the money supply will inevitably lead to increasing prices, but that assumption is far from a forgone conclusion in economics. The only definition of inflation rate that anyone accepts is the rate of increasing prices. And if your view is right (that the printing of money always leads to increasing prices) then you shouldn’t have a problem with the standard definition.
There are two ideas surrounding money creation. One idea is that the central bank creates money and issues it to banks, which forces prices up as “too much money chases too few goods”. While this theory, called the quantity theory of money, has a lot of supporters because it has a lot of good math surrounding it and is incorporated into many many models, there is little evidence that the issuing of money pushes prices up. Furthermore, there is even evidence that the Federal Reserve does not even control the money supply, even though it thinks it can.
The opposite view is that money creation is not exogenous to the Fed, but endogenous to Demand. It is Aggregate Demand that creates money. The Fed can lend to banks as much as it wants to to shore up liquidity, but there is no reason why that money will be lended out to business balance sheets. In this view the Fed is not a money provider, but a liquidity provider, fulfilling its mandate as a lender of last resort to the banks. Therefore, if the Fed fails to provide liquidity, it would be similar to a scoreboard putting a limit on the number of points scored in a football game. This is the view I subscribe to.
Fiat money, is not any more or less “real” than metal currency. Both fiat currency and metal currency are valid state currencies, a currency that a state uses to pay for goods and services and receive taxes for. Both currencies have demand, because we need them in order to pay our taxes. Both fiat and metal currencies require confidence in order to have value. The value of ALL currencies is tied to our confidence in them. The fact, that gold assets are priced very highly is because a good deal of portfolios hold gold. The reason why dollars have value, because people need dollars to pay their taxes on their income. So therefore, as long as people have confidence that their government is stable, hyperinflation simply is not something to worry about.
Ken,
I don’t have to repent of an economic theory. The Blessed Lord never said, Blessed are the Austrians for the kingdom of heaven is theirs or Thou Shalt not be a Keynesian. My economic theory will not be something judged in the last days, as it is something interesting but finally unimportant, like sports and penmanship.
The entire argument about apriorism is put forth to support the benightedly ignorant theory that economics is a quantitative and predictive science, i.e., analogous to the physical sciences, rather than the social science that it actually is. The advocates of econometrics are the victims of their own misunderstanding of the very nature of “economic science.” This becomes readily apparent when one considers the manner in which physical sciences function. One can describe physical phenomena in deterministic as well as statistical quantitative expressions (i.e., equations) that, if one has access to the measured values of all the variables, can be used to predict future actions given a particular set of initial and boundary conditions.
In economics, one is dealing with an enormously large number of variables (all of the factors of production in a given process, plus the individual personal priorities of all of the customers for a given good, plus all of the unknown, and unknowable, variations over time of those individual priorities, and the same for all of the goods which are competing for the factors of production at the same point in time). Add to that complexity the fact that, even if one could determine the value of each of those variables, by the time one had gathered, collated and analyzed the data and is ready to insert them into whatever equation might have been determined to provide the optimum (N.B., I did not say exact) solution, enough time will have elapsed so as to render the required data stale, as many, if not all, of the individual preferences and priorities of the potential customers for all products using those factors of production will have changed, and you are back to the point of not knowing what value to insert for any particular variable. Even if one writes what might be a valid equation, one can never know, on any useful scale of space and/or time, what the precise initial and boundary conditions are!
Pax et bonum,
Keith Töpfer
@mbutton,
Your comment that
would seem to be contradicted by the steady boom in real estate prices that preceded the bust, caused in considerable part by agencies of the Federal government virtually demanding that large mortgage banks include loans to about 22% of their customers most of whom weren’t actually able to make their mortgage payments, thereby creating the bust in which our economy now finds itself. This pattern is commonly referred to as malinvestment, and it is that malinvestment which must be liquidated (i.e., cleared from the marketplace) before there is any hope of serious recovery.
On another note, God shouldn’t need to say “Thou shalt not be a Keynesian” because anyone who looks at the effects of the various government stimuli and notes that they have had no discernable effect should recognize, almost instinctively, that the Keynesian ideas of “idle resources” and of “priming the economic pump” are at least as ludicrous as you seem to think the Austrian school’s ideas are. Those Keynesian ideas are as valid as the idea that destroying perfectly serviceable autombiles (think “Cash for Clunkers”) in order to purchase new ones is a net positive. That is simply a new variant on the “broken window fallacy,” the product of failing to note that the money spent on the unneeded new car is now not available to purchase what the family has that actually needs replacement—in other words, ignoring that economic activity that cannot now be undertaken because the needed resources have been used for what should have been an extraneous purchase.
Pax et bonum,
Keith Töpfer
Pax et bonum,
Keith Töpfer
Pax et bonum,
Keith Töpfer
Please keep ranting about this Fr. Z.
Thank you for ranting Fr. Z. I hope your blood pressure has subsided – – it has sure done my heart good to find other Catholics (in this and other posts, links and comments) who object to this paper based on Biblical first principles, the Church’s own moral and social teaching AND sound free market economics.
Christ drove out and dispersed the moneychangers, and yet it seems the Pontifical Council with its call for a central world bank is intent on ushering them back in.