Pope Francis’s unique contribution to Catholic social teaching is to emphasize the role of the entrepreneur and to endorse the social-market economy, but he has yet to emphasize sufficiently the importance of institutions and would be well served by better data.
Those are some of the conclusions of The Business Francis Means: Understanding the Pope’s Message on the Economy, a new book that sets out to translate the pope’s statements into an Anglo-American mainstream cultural context that has often been suspicious of the pope’s views on the economy.
Its author, Father Martin Schlag, an Opus Dei priest raised in Austria, recently took up his role as professor of Catholic Social Thought at the University of St. Thomas in Minnesota, where he directs the John A. Ryan Institute for Catholic Social Thought.
Schlag, who is also author of a highly regarded Handbook of Catholic Social Thinking, says his new book is aimed at “especially those Catholics and Christians who, in general, feel more at home with St. John Paul II and Benedict XVI and who, like me, are conservative on doctrinal questions, but at the same time want to raise to the demands of the Gospel that we serve the poor among us.”
Although most of what Francis says on the economy is unremarkable for its content and mostly within the tradition of Catholic Social Teaching, Schlag believes he has applied it with a new verve and directness, using a “pastoral hermeneutics” or “hermeneutics of evangelization” using “the point of view of the poor and their needs that cannot wait.”
That means, says Schlag in the book, “Francis is keenly interested in the socioeconomic context of evangelization and the need to denounce blatant injustice. He therefore delves into specific questions, more than his predecessors did.”
Meaning that even when his assertions on economic topics might not be backed by empirical data, “the moral message is quite clear to see.”
In an interview with Crux, Schlag explained further his take on Francis’s contributions to Catholic Social Teaching (CST), arguing that, paradoxically, his focus on the good entrepreneur rather than the state makes him a natural ally of authentic U.S. capitalism.
Austen Ivereigh: You’re concerned to show how Francis fits into the CST tradition, and where he is extending it or departing from it — that’s really the book’s purpose. You say in the book that he hasn’t revolutionized CST, and that his statements are not as original as they’ve been reported, but you do say he’s the first pope to endorse the social market economy. So how would you summarize, on the back of an envelope, the question of how Francis fits the CST tradition?
Schlag: What I say is that he has given a new spin to traditional concepts. He always says, almost like a mantra, that he’s saying nothing new, and that everything he says is CST, and please consult the Compendium of Catholic Social Teaching. But the surprising thing about Pope Francis is that he says more about entrepreneurship than Pope Benedict. Benedict tends to speak about the Church in terms of the hierarchy, and shouldn’t get involved in politics — that’s Deus Caritas Est — because for him it’s hierarchy, whereas for Pope Francis it’s the People of God. But equally surprising, when I came to study Francis’s remarks, I found he only uses the term ‘social justice’ once; he speaks of the preferential option for the poor in the sense that the theology of the people means it.
What’s the key difference?
Social justice addresses public authority to try and reduce inequality and social injustices, whereas the preferential option in the thinking of the theology of the people is that everyone in society has to work towards helping the poor, lifting them up — and therefore he is for the good entrepreneur, the good individual who creates work. Surprisingly, I think this is the unique contribution of Francis.
You say he’s the first pope specifically to embrace the social market model, the one taken for granted in western Europe since World War II. Is that a significant development?
St. John Paul II also once mentioned the social market economy, but in a speech when the German ambassador was presenting his credentials, so it was really not an important context. Francis has used it at least twice, and often speaks of “the social economy, social market economy.” He has so far been very strong in the prophetic denunciation of injustice, and of the priestly calling to holiness, but he leaves the constructive side, which would correspond to the kingly munus, to the laity. On both these occasions his model is this combination of public and private, social and business, that characterizes the social market economy.
One of those occasions, I think, was his Charlemagne speech, where he contrasts a social economy with a liquid economy which he associates with globalization. He has made a lot of critiques of what you in the book call the chrematistic cycle, in which finance overwhelms the economy. You attribute this preoccupation in part to his experience of the 2001 crisis in Argentina. Do you think his view of globalization is essentially that finance has acquired too much reckless power, that it needs to be checked?
Definitely yes — he expresses this with the formula, ‘money must serve, not rule’ which actually defends finance. He is not against finance as such, but finance that disregards the need of the real economy. The expression ‘liquid economy’ is very powerful because it expresses that in consumerism and in a globalized society in the sense of a society that has no link with a specific territory, we have reduced the scope of ownership, and therefore of ability and responsibility, and have opted for buying access to experience. People don’t want to marry or to own a house, they want free relationships and to rent a small flat — all this is linked.
Do you think his reading of globalized capitalism is an accurate one, and doesn’t it therefore follow that you need a social economy in order to restrain the impact of that liquidity?
I’m not sure if we can say everything that Pope Francis says about global capitalism is really accurate. When he was asked about his judgement of global capitalism he said I’m sorry, I can’t answer, so it would be unfair of us to impute to him what he hasn’t said. But what he has said is that the human person has to be at the center, so if we have a system where business is not interested in the social or ecological impact, and it’s only about profit maximization, then he would be clearly opposed to that.
You note that the problems of Latin America are “essentially home-made” and the result of the lack of inclusive institutions, and you say that Francis hasn’t yet developed a thinking about the importance of institutions in his messages. When Francis refers to “an economy that kills,” do you think he should also refer to the need of economies to be checked by vigorous institutions?
A capitalism that is not checked by institutions is self-destructive, and turns against the human person. It would not be freedom but libertarianism, because it is impossible for us to live freedom on our own. Actually we can only live in freedom in the institutions we have built together. I’m not sure whether Francis is sufficiently acquainted with the original set-up of the American economy, which is under pressure. It’s not as if the capitalism of America right now is the good capitalism John Paul II speaks about. There’s so many elements which need to be changed and purified, which is why I think Pope Francis’s message is so relevant for restoring the original genius of American capitalism.
In talking about the nature of his papacy, you say — and this is something most people would agree on — it is conditioned by a pastoral approach, and the priority of evangelization. And you make an interesting observation about Francis being keenly interested in the socioeconomic context of evangelization and the need to denounce blatant injustice, which of course we see in Evangelii Gaudium. This leads him, you say, to be more interested than his predecessors in specific questions. Can you explain?
What I mean is that Benedict XVI was very careful never to say anything specific. Both in Deus Caritas Est and Caritas in Veritate, or in his addresses at Westminster Hall [in London in 2010] or the Bundestag [in Bonn in 2011], his addresses were at a very high level, and he was always talking about an intellectual dialogue and engagement. John Paul II was very forceful on religious freedom and the right to life, and the need for a legal framework for the economy, and so on. But Francis has been very specific on particular topics such as migration, deploring the conditions of the camps in which refugees are kept, and so on — he’s really been capturing the public imagination by being so specific and clear what he has in mind. So that’s what I mean.
What is the link between that specificity and evangelization?
The link is that we cannot credibly preach the Gospel without pointing to those phenomena that contradict justice and charity. I think that is the true insight of Decree Four of the 32nd assembly of the Jesuits [in 1974]. People don’t get the impression he’s diplomatic. That’s what they like about him.
He’s concrete. Concretezza — concreteness — is one of his favorite words. One of the other things he’s concrete about is change, and that — as you say — he expects change to begin at the margins, from below, rather than from above, from the leaders of business and politics. Do you think that makes him a less relevant figure for businesspeople?
No, to the contrary. If you want to pastorally engage the rich, make them work for the poor. He’s really doing the right thing. Businesspeople are fascinated by him — in the good sense, but they are also bewildered sometimes. What does he mean by this or that? The young people I teach in my MBA [Masters in Business Administration] class all resonate with what he says. Yes, we have the world in our hands, so let’s put our hands to the service of the underprivileged and the marginalized.
So you’re saying because his message is unsettling, it’s that much more interesting?
Exactly!
When you critique Francis, it’s always phrased very gently, but you say at one point that you’re not always sure that his statements are backed up by empirical data, but that the moral message is clear. And later you say again, the possible flaws in his economic theory do not obscure the moral messages that are primarily intended. So you’re making a very clear distinction there — it is a moral message, and he has a prophetic role. But do you think he would be more credible if he were better substantiated?
Yes, I think so. I think it would help to have a really good economic council of advisers, to have internationally recognized, not necessarily Catholic, economists who could give him some good data at least. He could say to them, “I’m shocked by this, is this true?” John Paul II did that before he wrote Centesimus annus. But I don’t know, the pope has so many things to do, and he’s not an economist. But I think it would give him more force.
You give one example where the pope is problematic in his economic assumptions when you quote from him in Laudato Si’ saying that is why it is necessary now to accept decreased growth in some parts of the world in order to provide resources for other places to experience growth. What is your difficulty with that? Doesn’t the obsession with growth and consumption in the rich world have a very damaging impact? Or is your problem that he’s making a link between increased consumption in one part of the world and decreased consumption in another?
That’s right, the second — it gives the impression that the economy is a zero-sum game, which was the old mistake of mercantilism. Ideally growth in one part of the world should bring about growth in another part of the world, if the institutions are well built. What Trump is doing now is the opposite. It’s protectionist, America-first, and he’s going to hurt the U.S. in the long term.
Because, of course, when talking about immigration, Francis is keen to say that it’s important for the health of a nation to receive migrants, and economists would say that’s right, that migrants don’t take jobs but create them.
Exactly, it’s not a zero-sum game.
So maybe you’re implying there’s a paradox here, that Pope Francis, who speaks for the poor and the periphery, may well have a prophetic function in promoting a truly liberal global economy?
He doesn’t formulate it that way, because he doesn’t speak about institutions, it’s just not his topic — I can’t think of any address he has given on how society should be ordered. But yes, I think that’s the surprising result.
[Martin Schlag’s Handbook of Catholic Social Teaching: A Guide for Christians in the World Today and The Business Francis Means: Understanding the Pope’s Message on the Economy are both published by the Catholic University of America Press.]
