History, theology support capitalism

Published 9:15 pm Sunday, December 8, 2013

Pope Francis has shown himself to be a thoughtful, sincere and scholarly pontiff. So it’s with respect, even some fear and trembling, that we have to say he’s wrong about capitalism. The Holy Father’s first apostolic exhortation, “Evangelii Gaudium” (“The Joy of the Gospel”), has much to say, including a passage condemning capitalism and greed.

“Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless,” he wrote. “As a consequence, masses of people find themselves excluded and marginalized: without work, without possibilities, without any means of escape.”

That’s something of a straw man; Pope Francis equates the free market with social Darwinism, and mistakes correlation for causality. Yes, there are poor people. There are many who are truly marginalized. But where they’re marginalized the most is where the markets are the least free. The few remaining socialist economies (Cuba, Venezuela), food is rationed and hope is repressed.

History has shown that free markets are the best way to lift people from poverty. There are solid, even theological reasons for this. Greed is a sin, of course, but it’s also a fact. Capitalism is the only economic system that recognizes this fact, and employs it to everyone’s benefit.

There’s nothing selfish about capitalism, writes Daniel Hannan, a member of the European Parliament. “Like every economic model, it is a matrix within which individual actors can behave morally or immorally. But here’s the thing: No one has yet come up with a system that rewards decent behavior to the same extent.”

As Adam Smith wrote in the 18th century, “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.”

The baker bakes bread because he’s rewarded for the effort — and we have bread to eat. We all gain.

“Under the various forms of corporatism tried by fascist and socialist regimes, by contrast, someone else — generally a state official — gets to allocate the goodies, guaranteeing favoritism and corruption,” Hannan writes.

Adds economist Anthony Gregory of the Ludwig von Mises Institute, “It is simply a fact that capitalism, even hampered by the state, has dragged most of the world out of the pitiful poverty that characterized all of human existence for millennia.”

Capitalism, not its alternatives, has transformed the world dramatically.

“It was industrialization that saved the common worker from the constant tedium of primitive agriculture,” Gregory explains. “It was the commodification of labor that doomed slavery, serfdom, and feudalism. Capitalism is the liberator of women and the benefactor of all children who enjoy time for study and play rather than endure uninterrupted toil on the farm.”

Pope Francis is right to pray for more political leaders who empathize with the poor. We should, too. But that empathy must be followed with intelligent policies that have the right result — lifting more people out of poverty.

The lesson of history is that capitalism and free markets are the best way to achieve that.