SPECIAL REPORT • MORAL POLITICAL ECONOMY

The Human Foundations of A Moral Political Economy

BY FR ANTHONY EGAN SJ | PRETORIA

FEW PROFESSIONAL economists are theologians. Fewer theologians — including bishops and popes — are professional economists. Thus, while it is common among theologians to approach social issues, it is often very dangerous to make absolute moral claims about economic questions. Yet, theologians and economists, business people and religious leaders, even politicians (though sometimes it may be hard to notice!), have what we might call a moral sense — whether this sense is rooted in faith or not. In this article I would like to address what I have called the human foundations of a moral political economy.

I must point out why I use the term political economy, as opposed to economy, and why in some respects the term is somewhat of a tautology. Political economy, according to classical and contemporary definitions, examines the relationship between business (broadly understood) and governance (the latter normally understood as laws, policies and the political systems that underpin the former). Given that no economy exists outside a social structure — and the structure is based on relations governed by politics — the connection is inevitable.

Moral economy

That the term I use ‘moral political economy’ is tautology rests on the historical roots of political economy within moral philosophy. All great economic theorists, including Adam Smith and Karl Marx, developed their theories primarily out of a sense of morality. It is worth noting that Adam Smith (1723–1790) wrote his first major book, The theory of moral sentiments (1759), seventeen years before the work often hailed as the ‘bible’ of capitalism, The wealth of nations, in which he embraced an ethic based on sympathy. He never rejected this claim, so we must infer from this that his later endorsement of a free market is rooted in it — and that care for others should inform capitalism.

Similarly, Karl Marx — by no means the ‘founder’ but certainly the most important theorist of socialism — was firstly a moral philosopher. His rejection of capitalism was driven by his sense of moral outrage at the social conditions he saw as the ‘collateral damage’ of 19th Century economics.

I could go on further but I shall merely suggest that any political economy rests on certain moral foundations.

What then of a ‘Christian’ political economy, a term we sometimes see bandied about quite merrily. My first proposal about this is: There is no such thing as a Christian political economy, only a political economy that can be addressed by Christians (or indeed any other religious community). Starting from the Bible and moving into moral discourses like Catholic Social Teaching, this may seem contradictory — but closer examination, I hope, should defend my thesis.

Economy and Scripture

It is often the case that the Bible is used to justify economic principles and practices. The Hebrew Bible’s advocacy of the shmita or Sabbatical Year (Ex 23: 10, 11; Lev 25: 2–7, 20–22; Deut 15: 1–3) or the yōbel (Ju- bilee Year) (Lev 25: 8–13) seem like cases in point. The first refers to a practice of leaving the land fallow every seventh year. The second entails debt forgiveness, slave emancipation and land restoration. Yet it is disputed whether either practice regularly happened, or ever.

Similarly, in the New Testament, while Jesus regularly attacks the unjustly rich, embraces simplicity of life and his disciples — at least in the early Jerusalem — seemed to have practised communal ownership of goods (so much so that one suspects Marx partly plagiarised the Acts of the Apostles in his formulation “From each according to his [sic] ability, to each accord- ing to his needs”), there is no clear indication here of a nascent theory of political economy. If anything, the New Testament shows a variety of people practising a broad range of economies, including a slave-based economy. The one thing that can be said definitely is that the disciples of Christ embraced an expansive practice of charity. Charity which included Christians and extended beyond themselves, according to Rodney Stark (1997), was one of the marks that accounted for the faith’s rapid growth in the roman empire.

In fact, the idea of Christian morality informing political economy has a very chequered history. Early Christianity tolerated (however uneasily) slave-based economies; while some Christians condemned it, the Church largely turned a blind eye until the 19th Century. The semi-slavery of feudalism was openly blessed by the Church, just as it later quietly endorsed the rise of capitalism. While some Christians embraced socialism, the Church as a whole did not. As socialism became increasingly anti-religious in some countries, the Church first condemned unions and socialist parties and then, as the working class of Europe rapidly abandoned religion in the late 19th Century, tried to create Christian trade unions and Christian Democrat parties as a means to counter the threat of the Left.

Catholic Social Teaching

From 1893 the Catholic Church developed Catholic social teaching as a means to provide moral guidance on socio-economic and political matters. As a discourse that appealed fundamentally to moral principles, it took a middle path between capitalism and socialism with varying degrees of success. Its limitation lay in it being a reactive discourse — it responded to ideas and practices already current in society. The teaching was, and is, often suitably ambiguous so that it could be read by both capitalists and socialists alike. This was both its strength and weakness.

With the Second Vatican Council (1962– 1965), in a context of increasing secularisation and loss of direct religious influence on society, the Catholic Church as a whole embraced a more thorough dialogue with the world. Part of this was accepting the autonomy of public life, including political economy. The Church would (indeed could) no longer prescribe to the world, but rather appeal through reasoned argument, as opposed to moral commands ‘from on high’ as it were.

In a commentary on the Second Vatican Council, referring to the understanding of economics in the document Gaudium et Spes, theologian Matthew Shadle (2018) observes that it recognised that “the economy is an ‘abstract system’, autonomous from both religious considerations and other social systems”, yet also “an ‘expert system’, a system governed by its own laws that require expert knowledge for proper understanding and management.” In addition, he suggested that Vatican II’s recognised engagement with the economy took the form of inner conviction rooted in linking economics with “public values such as human dignity and the common good”.

In short, the Church would no longer speak of an economic system as ‘Christian’ but seek the ‘secular’ human values that reflected the Christian understanding of what it means to be human in any and every economic system. Thus, my suggestion that there is no such thing as a Christian political economy.

Motivations and ethics

With regard to this proposition, I would like to defend a second proposal, which may at first glance seem harsh, even cynical: people are motivated by interests as well as compassion. Ethicists Claire Andre & Manuel Velazquez (1988) present the case that at bottom most people are motivated to be moral by self-interest. The term in ethics is often called egoism.

They remind us that many psychologists observe that when “we see someone in distress, we ourselves experience feelings of distress, such as shock, alarm, worry, or fear. This unpleasant emotional arousal leads us to want to increase our own well-being by reducing these feelings. One way to this goal is to reduce the other’s distress. Helping, then, is only a means to reducing our own distress. What appears to be altruistically motivated behaviour is really only self interest in disguise”.

They note, however, that contrary evidence also presents itself. Other psychological research has revealed that people faced with a similar circumstance feel deep empathy and a desire to help. Many, indeed, help where they can. We call this altruism.

While this may seem a digression, let me suggest that these two moral psychological poles — egoism and altruism — are essential dimensions to how we embrace a moral political economy. Here, the context in which an economy functions, as opposed to the economic system itself, is key. Crucial to all of it is Trust. Does one feel a participant in the economy and society in which the former functions — or not?

In an economy where everything is geared towards survival and where the society is deeply unequal and often marked by the accumulation by the few of power and privilege, the more likely that low trust exists between people. Where the society and economy are governed by a rule of law applied equally and fairly, the more likely trust will be the social norm. This is true, I think, in any economy, as is born out if we look at some interesting surveys.

Consider the recent (2020, surveyed in 2019) United Nations Human Development Index (HDI). The top countries are (in order): 1. Norway; 2. Iceland and Switzerland; 4. Hong Kong and Ireland; 6. Germany; 8. Australia and Netherlands; 10. Denmark. Close runners up include Finland, Singapore, United Kingdom, Belgium, New Zealand and Canada. Similarly, the Inequality-adjusted HDI (2020) reveals: 1. Norway; 2. Iceland; 3. Switzerland; 4. Finland; 5. Ireland; 6. Denmark; 7. Sweden; 8. Netherlands; 9. Slovenia; 10. Germany. Runners up: Australia, Czech Republic, Belgium, New Zealand and Austria.

With few exceptions, notably Hong Kong (an authoritarian semi-democracy), they are what might be called ‘social market economies’ or social democracies—marked by high taxes and extensive welfare services. They also mirror very closely a Global Prosperity Survey (2020), that looks at the individual well-being of the average person: 1. Denmark; 2. Norway; 3. Switzerland; 4. Sweden; 5. Finland; 6. Netherlands; 7. New Zealand; 8. Germany; 9. Luxembourg; 10. Austria. And guess who the runners up are? Iceland, Ireland, United Kingdom and Canada.

It’s worth noting that the global super-economies United States, China and Russia don’t feature.

Social democracy and moral economy

So, is it simply that social democracy is the moral economy for our society? Well, not on its own. There are numerous social democratic, socialist or faux socialist countries that don’t feature.

Let me risk boring you with another survey, the Transparency International Corruption Perception Index (2020) on global corruption (data gathered in 2019). Here the least corrupt countries on Earth are: 1. New Zealand and Denmark; 3. Finland, Sweden, Switzerland and Singapore; 7. Norway; 8. Netherlands; 9. Luxembourg and Germany; 11. Canada, United Kingdom, Australia and Hong Kong.

Can you see a correlation? The Transparency survey is in a certain sense a measure of a society’s trust (or lack of trust) in its government and institution. Most of the countries — whatever their socio- economic system (though I must admit social democracy seems to be prevalent in most!) — that have high trust in their institutions are both high in human development and prosperous. They are also, according to the 2019 World Happiness Report (2020), the happiest people in the world.

Is this religiously motivated? Apparently not. Interestingly, when we look at religious observance in most of the top countries on these lists, (the Pew Research Forum 2018 study does not include Iceland, New Zealand and Luxembourg), none of them are particularly good at church attendance or hold religious belief in high importance. Of those mentioned, Canada is the most ‘religious’ (27% see religion as important, 20% attending regular services), followed by Ireland (22% and 20%).

Moral political economy of trust

This leads me to a few conclusions that I believe must necessarily be tentative. My first ‘conclusion’ is that trust (Fukuyama 1995) is the basis on which an altruistic ethic can grow, whatever economy a society chooses. A moral political economy needs trust above all. In contrast, societies with high corruption and high inequality like South Africa do very badly on trust in government, general happiness, and tend towards a kind of egoistic survival mentality — even despite scoring very high on religion (75% seeing religion as important, 55% attending regular services, in our case).

Secondly, the evidence suggests that since religious belief in society does not correlate with trust or altruism, we cannot continue to fool ourselves that by the Church merely proclaiming social ethics, it will simply happen. Reception of Church social teaching is largely determined by human factors in society.

Thirdly, and conversely, it’s noticeable that social democracy, which has also become a kind of moral default in Catholic Social Teaching, seems the most effective system to create a good society.

Evidence perhaps that God works anonymously in human morality, whether people are religious or not?