What a Catholic who is a capitalist believes

Capitalism is a economic system. It is not an ideology, not a political system, not a social system, not a religion, by itself, it does not define a culture.

Economic systems are about scarcity. What's perpetually scarce is intelligence, labor, and raw materials. As a Catholic, I believe that these are gifts from God and therefore subject to God's plan for how we use them. That's important because this is an area in which we are not autonomous from God. What is scarce will always engage moral questions of who owns it, who gets to use or consume it?

In Capitalism ownership of the means of production is held privately. The owners of capital make decisions on supply, demand, and allocation in free markets. That's the outline definition.

I am a capitalist who thinks that addressing poverty is important to giving capitalism a moral foundation. This puts in me in opposition to Ayn Rand and her followers who minimized if not deprecated charity as a virtue.

If I were to look at what the critical question today worth talking about is whether the poor have a claim to the wealth of others by the fact they don't have it. Is wealth inequality in itself contrary to God's justice? My own opinion is that poverty entails suffering from deprivation: not enough food, not enough shelter, not enough health care - the critical needs for life are not being met among people without an ability to earn it in a capitalist economy.

Catholicism and Economics

At the Nassau Community College, Center for Catholic Studies

The speakers were

Charles Clark, the Democratic Socialist, St John's University

Michael Novak, the Democratic Capitalist, American Enterprise Institute

Thomas Storck, for the Distributists, The Distributist Society

It was not capitalism's day to shine. It's wasn't a classic debate along the lines of "Resolved: The United States should abandon capitalism for socialism." or
"Resolved: The United States should abandon capitalism for distributism" it was more like put the texts of An Inquiry into the Nature and Causes of the Wealth of Nations through Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse into a pinata and beat it around.

Really, there were so many lies and half-truths said about the "c" word, there would be scarcely any time to offer up criticism on socialism and distributism.

Michael Novak, I think, fell into several traps, citing government interventions into political matters as favorable evidence for capitalism. I thought citing the provision for patents and copyrights in the Constitution as a very odd way of defending capitalism -- an example of how the government grants a limited monopoly. Rather, it demonstrates that government often intervenes into markets.

Rather than convincing me to stop being a capitalist, I heard many familiar complaints which I could have answered like "capitalism necessarily increases income inequality", but I also heard a few that made me think about things: how different the country would be if it were not so easy to create limited liability corporations.

The lasting impact on me was a resolution to reread Rerum Novarum (1891) and its sequels through Centesimus Annus (1991) to get a better sense of how they connect to Catholic social justice.

Finally, if they do this again, it should include someone who can argue for more capitalism -- that the Louisiana Purchase was unconstitutional because it was not an enumerated power, and that "commerce clause" cases all the way back to Gibbons v. Ogden were decided in contravention of the principles of capitalism. Don't stop with unwinding creeping socialism in FDR's new deal, let's unwind all the way back to George Washington.

Five Very Dangerous Words

failure of the free market

This is tough to discuss with someone who believes this -- precisely because one has to confront the defective worldview that makes it possible to utter such a phrase.

Now, I want to concede that if there was a place on earth with free markets, the rule of law, government by consent, individual rights, and generally speaking people who believe in right and wrong -- and if there's an inability there to obtain the necessities of life by ones effort -- I'd want to reexamine the following assertion -- when someone says free markets have failed, then we have an error in defining "free markets" or "failure".

Overheard Conversations Dept.

Locale: Post Office

They need to give more back. I mean charities and taxes. They are keeping us poor.

I only agree that some rich ought to think more about charitable giving. It seems that some rich only think about that when they know it will be revealed as part of running for office or getting appointed to a public office.

I am a charitable giver because God expects it of me. It's all God's money in the first place.

Where I disgree but I don't take offense is that the person I overhead (perhaps not -- she was quite loud and proclaiming it to the public) is that a rich person making another dollar is taking a dollar out of a poor person's pocket.

The size of the economic pie is not fixed, and it grows with something called capital.

What is capital?

Capital is money (you knew that already...) being used to make more money. The other uses of money are consumption (i.e. what you put in your mouth -- goods and services for which you are the end user), taxes, and gifts.

Over and over again on talk radio, I hear (a) examples of basic economic illiteracy and (b) knowledgeable people complaining as I am now that without many more Americans understanding the difference between consumption and capital, we capitalists are doomed.