Pope Francis and the morality of Free Markets

The opposite of tyranny is freedom.  Capitalism is the practical and constructive expression of freedom.

By John Hayward          

Pope Francis had some criticism for “unfettered capitalism” in his Evengelii Gaudium, and public statements he has made in concert with release of the document.  My first inclination in response is to wonder where he believes this unfettered capitalism might be found, because there most certainly is no such thing in the Western world.

That’s not a minor quibble, nor is it meant as a snarky comeback.  State control over private industry is a dominant fact of life around the world.  There are very few places that come anywhere near the capitalist ideal of a limited government equally enforcing the property rights of all.  That is the necessary – indeed, indispensable – role of government for any true capitalist.  Theft and fraud have no place in a free market, because they are infringements against economic liberty, as well as disrupting the efficient allocation of resources.  Capitalism is all about voluntary commerce.  The victims of thieves and swindlers do not act of their own volition.

Government power is also an offense against economic liberty, when exercised for purposes beyond securing the equal rights of all.  This is where I find myself in disagreement with key elements of the Pope’s critique.  It’s not quite that broadside against free markets that opportunistic leftists made it out to be, and it’s risible to treat it as an endorsement of the stale and corrupt Big Government racket venerated by American liberals.  The Pope was pretty tough on the welfare state and government debt, as well as capitalist excess.  But the portion of his pronouncement quoted by the Wall Street Journal merits a response from anyone who would defend not only the superior accomplishments, but superior morality, of capitalism over its grim and oppressive alternatives:

Using unusually blunt language, he sharply criticized the market economy. “Just as the commandment ‘Thou shalt not kill’ sets a clear limit in order to safeguard the value of human life, today we also have to say ‘thou shalt not’ to an economy of exclusion and inequality,” wrote the pontiff in the 224-page document known as the apostolic exhortation.

“Such an economy kills,” wrote Pope Francis, denouncing the current economic system as “unjust at its roots” and one “which defend(s) the absolute autonomy of the marketplace and financial speculation.” Such a system, he warned, is creating a “new tyranny,” which “unilaterally and relentlessly imposes its own laws and rules.”

We have to say “thou shalt not” to “an economy of exclusion and inequality?”  Thou shalt not what?  What verb would come at the end of this new commandment?

“Exclusion,” and the inequality of opportunity, are sins that can only be committed by criminals and the State.  Armed gangs are noted for excluding people and destroying their opportunities.  So are government bureaucracies.  In fact, they employ many of the same methods.  The State loves to exercise power far beyond the letter of the law through intimidation tactics and unfunded mandates.  They wear business suits and power ties instead of gang cuts, but the basic principle is similar.

Just and lawful governments seek to protect the equality of opportunity, but there is a far greater banquet of power and money waiting for the politician who declares he will enforce equality of outcome.  That’s where the dreary, oppressive machinery of redistribution and confiscation come into play.  Equality of outcome is highly subjective – the powerful decide what is “fair,” measure out what individual groups are “entitled” to, and seize whatever power is necessary to enforce their judgments.

This process is inherently immoral, because it deploys the coercive power of government against people who have committed no crime.  It also tends to result in a maze of incomprehensible laws that turn even the most well-meaning citizens into presumptive criminals.  Everyone is a “violator” when the law is so inscrutable that honest people can’t possibly obey it.  It’s not a question of learning the sort of clear-cut rules that one might find inscribed upon stone tablets, and making good faith efforts to obey them.  The citizen becomes more concerned with escaping the baleful notice of the all-powerful ruling class.

The Pope charges autonomous marketplaces with creating a “new tyranny,” but tyranny is an exercise of compulsive power.  It is not subtle, or invisible.  Private corporations can certainly become willing partners in tyranny.  The Twentieth Century is filled with mournful examples of such relationships.  Large private enterprises often grow eager to purchase the anti-competitive power sold by corrupt politicians.  But the government has a monopoly on the coercive force necessary to create tyranny, a word that has a very specific meaning.  A private individual might be criticized for indifference to the suffering of the poor, but such indifference is not tyrannical.  Monopolistic power can assume the trappings of tyranny in the way that it crushes those who seek opportunity in a controlled marketplace, but the nations of the West already recognize the accumulation of monopoly power as a crime, which governments are charged with preventing.  (In practice, they’re more apt to become willing partners in creating monopolistic conditions, as in the sealed labor markets they create for the benefit of powerful unions.)

It seems to me that the abusive situations Pope Francis has spoken out against, such as unsafe sweatshop exploitation, are more properly understood as forms of corruption, which is a failure of government.  Not to let those who buy corrupt politicians off the hook, but the vendor in such sinful transactions is the one who makes it possible.  The modern Left has invested great effort in making corruption respectable, conditioning citizens to accept it as standard operating procedure.  The ideal of small, clean governments equally and impartially defending the rights of all has been replaced by activist super-States with busy agendas, perpetually in search of private-sector “partners” (with thick campaign checkbooks) to carry them out.

It would be better to focus on the immense costs inflicted by such corruption, especially in the huge, politically dominated economy of the United States, where the government routinely wastes enough money to feed every hungry person in the world.  Billions of dollars vanish in waste and fraud, under the stewardship of a lavishly compensated bureaucracy that sure isn’t missing any meals.  Genuine poverty and suffering have been conflated with the frustrated ambitions and desires of the lower middle class, for the political profit of leftists, but the resulting redefinition of the welfare state – which, in the absurd regime of ObamaCare, is now paying welfare subsidies to families that make over $60,000 per year – leaves fewer resources to help the people that really need it.  It has always been immoral to confuse charity with social engineering.  There’s a big difference between feeding the hungry, and subsidizing an indolent lifestyle.

How should the success of a “war on poverty” be measured?  Is it better to reduce the amount of poverty… or give a more comfortable life to a larger number of impoverished people, with the definition of “poverty” defined absurdly upward?  History has shown us no evidence that government redistribution reduces the level of poverty in any society.  On the contrary, poverty walks hand-in-hand with socialism, because the private sector inevitably shrinks as government grows, leaving fewer opportunities to be exploited by free people.  Those at the lower end of the income ladder tend to find themselves most deprived of opportunity.

And the invariable result of socialist economic policy is a smaller, richer elite lording over a more impoverished population.  ”Income inequality” gets worse under the rule of people who claim they are dedicated to eliminating it, as has occurred in the United States under the administration of President Barack Obama.  The Obama years have been mercilessly tough on the poor and middle class, but rather profitable for rich people with a lot of assets and money to play the stock market.  Travel further down the road Obama walks, and you’ll find socialist tyrants who proclaim themselves “men of the people” from the high balconies of palatial estates.

The opposite of tyranny is freedom.  Capitalism is the practical and constructive expression of freedom.  Free markets, secured by just and limited government, are the best way to reduce poverty, and generate the wealth necessary to afford charitable assistance to those who cannot make a good living.  It’s not just practically superior, it is morally superior.  How can proper respect be shown to any man or woman without respecting their rights to own property, sell their labor, engage in voluntary transactions for mutual benefit, and provide for their families?  ”Thou shalt not steal” is a commandment that should not be suspended for those who claim they have big plans to improve society with their plunder.