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Free Market and Morality: Some experts debate. What do you think?



The Free Market and Morality

Experts Debate Ethical Pros and Cons


By Father John Flynn, LC

ROME, DEC. 14, 2008 (

).- As economic indicators continue to nosedive, debate over the free market continues apace. On Dec. 3 the John Templeton Foundation hosted a forum in London to address the issue.A group of economists and commentators gathered to debate the topic: “Does the Free Market Corrode Moral Character?”

Michael Walzer, retired professor in the School of Social Science at the Institute for Advanced Study in Princeton, New Jersey, argued that free market competition forces people to break the rules of decent conduct. Attempting to justify this behavior leads to self-deception that corrodes moral character, he said.

Competition is not, however, only a negative force, Walzer added. Cooperation in economic enterprises produces mutual respect, friendship and solidarity, and people learn how to take risks and forge alliances.

Walzer proposed limitations on economic power and markets so as to reduce the corrosion due to market forces.

Kay S. Hymowitz, the William E. Simon Fellow at the Manhattan Institute, also warned against the negative effects of the free market on morality. The modern market economy introduces many novelties that undermine established cultural and moral traditions, she argued.

As well, stimulating the desire for more and more goods can lead to a weakening of self-discipline and our sense of moral obligations. In addition, the free market often promotes a sense of autonomy and hedonism that is particularly corrupting for families with little cultural formation.

Nevertheless, she admitted, the same market forces can help children and adolescents realize the need for discipline and study if they wish to achieve success in a competitive world.

Not black and white

John Gray, retired professor at the London School of Economics, took a similar view to Walzer, observing that free markets corrode some aspects of character, while enhancing others.

Gray recommended against relying too much on concepts of ideal models. In practice, he added, free markets rarely work according to the abstract economic models. As well, free markets are not simply the absence of government controls, as all markets depend on systems of laws and regulatory constraints.

Gray warned, however, that even though the free market system is imperfect and also tends to corrode some moral values, it does not follow that other economic systems are better.

“Centrally planned systems have corroded character far more damagingly and with fewer benefits in terms of efficiency and productivity,” he adverted.

John C. Bogle, president of the Bogle Financial Markets Research Center, premised his remarks by saying that it depends on what kind of market we are talking about.

The current financial crisis, Bogle maintained, is not really an indictment of markets, but is more due to a change from what he termed an “ownership society,” dominated by individual investors, to an “agency society,” where corporate managers dominate.

In the early 1950s, he explained, individuals held 92% of all U.S. stocks. Today, however, institutions and pension funds hold 75% of stocks. Bogle accused the managers of these institutions of putting their own interests ahead of the interests of those people whose money they are charged with investing.


Another corrupting influence has been the focus of investment strategies on short-term speculative gains, as opposed to long-term investing.

When it comes to the question of moral character Bogle said that the trend to moral relativism in recent times has eroded the force of ethical principles that once restrained people. The solution, he concluded, is to return to a purer form of the free market and to recover genuine moral virtues.

By contrast, Robert B. Reich, professor of public policy at the University of California at Berkeley, said consumers bear responsibility for many of the moral flaws in the market.

Frequently consumers avoid dealing with the conflicts between their market impulses and moral ideals, said Reich, who served as the secretary of labor under President Bill Clinton. For example, we want goods at the cheapest prices, but ignore the effect this has on keeping wages low for those who make the products.

Then, when we find out about ethical problems associated with consumer goods we often blame the producers and retailers, instead of taking some of the responsibility on ourselves, Reich continued.


Reich concluded the market does not corrode our character. Instead, by placing the blame on intermediaries, it allows us to retain our ideals, while making choices that lead to outcomes that, in practice, violate our principles. The solution, according to Reich, is greater transparency in the market, so we are more aware of the consequences of our choices.

Michael Novak, a well-known commentator on economic issues, and the George Frederick Jewett Scholar in Religion, Philosophy, and Public Policy at the American Enterprise Institute, drew attention to the importance of moral values in curbing some of the self-destructive elements within an economy based on the free market.

At the same time Novak observed that the very successes of the market system also tend, over time, to weaken those very moral strengths that are necessary for its success. “A generation committed to saving for tomorrow is replaced by a generation heedlessly living just for today,” he noted.

Therefore, Novak concluded, the greatest task of what he termed a commercial society is to return to its spiritual roots. This means an emphasis on the family, and on forming the next generation in good habits that will ensure a strong character.

Jagdish Bhagwati, a professor of economics and law at Columbia University, took a much more favorable view of markets and also of globalization. Many hold that globalization has harmful side effects, such as promoting child labor or harming the ecology. Bhagwati argued that the consequences are not negative, but rather positive and that globalization has been a force for good.

Moreover, he said, the forces of globalization combined with the Internet means that we are far more aware of problems and difficulties in other countries, which leads to a greater sense of our moral obligations toward others.

Moral defenses

French philosopher, Bernard-Henri Lévy, started his presentation by arguing that when the free market is released from all rules and governed only by the greed of the most powerful it will fatally corrode our souls.

The real world is, however, more complicated and we cannot simply declare that the market is only a negative force. The negation of the market economy that was present on both fascism and communism was by far a more deadly moral force than the free market, he argued.

The market economy, Lèvy noted, develops qualities of initiative, decision-making and creates bonds between people. He even maintained that the free market can reinforce our moral defenses, so long as we refuse the temptation of a capitalism that does not abide by any rules.

“The market, to borrow Winston Churchill’s famous phrase about democracy, is the worst solution, except for all the others,” Lèvy concluded.

Rick Santorum, a former U.S. Republican senator from Pennsylvania and now a senior fellow at the Ethics and Public Policy Center in Washington, D.C., noted that the free market depends on and rewards many human virtues.

At the same time he warned that the free market does not always coincide with what is virtuous or moral. Santorum recommended keeping in mind what Pope John Paul II said when he distinguished between the true freedom of doing what you ought to do, and the false freedom of doing whatever you want.

Rediscovering what genuine freedom really means may well be one of the keys to overcoming some of the flaws afflicting the economy today.



Filed under: consumerism, Market Place, morals

Globalization: Justice, Poverty and Peace


WASHINGTON—Globalization works only when all can grow, said Cardinal Francis George of Chicago, president of the United States Conference of Catholic Bishop, December 12. “The moral dimension of world poverty must be addressed if we are to have world peace.”
Cardinal George made his comments in response to Pope Benedict XVI’s 2009 World Day of Peace message, released at the Vatican, Dec. 11. The message is titled “Fighting Poverty To Build Peace,” and highlights the dangers of massive inequality among peoples of the world.
World Day of Peace is January 1.
“In today’s globalized world, it is increasingly evident that peace can be built only if everyone is assured the possibility of reasonable growth: sooner or later, the distortions produced by unjust systems have to be paid for by everyone,” Pope Benedict said. “It is utterly foolish to build a luxury home in the midst of desert or decay. Globalization on its own is incapable of building peace, and in many cases, it actually creates divisions and conflicts. If anything it points to a need: to be oriented towards a goal of profound solidarity that seeks the good of each and all. In this sense, globalization should be seen as a good opportunity to achieve something important in the fight against poverty, and to place at the disposal of justice and peace resources which were scarcely conceivable previously.”
Pope Benedict listed several areas of concern and noted that “fighting poverty requires attentive consideration of the complex phenomenon of globalization.” He cited moral implications of poverty and campaigns to reduce birth rates “sometimes using methods that respect neither the dignity of the woman, nor the right of parents to choose responsibly how many children to have; graver still, these methods often fail to respect even the right to life. The extermination of millions of unborn children, in the name of the fight against poverty, actually constitutes the destruction of the poorest of all human beings.”
He said that “since the end of the Second World War, the world’s population has grown by four billion, largely because of certain countries that have recently emerged on the international scene as new economic powers, and have experienced rapid development specifically because of the large number of their inhabitants. Moreover, among the most developed nations, those with higher birth-rates enjoy better opportunities for development. In other words, population is proving to be an asset, not a factor that contributes to poverty.”
The Holy Father cited concern for pandemic diseases, such as malaria, tuberculosis and AIDS. “Efforts to rein in the consequences of these diseases on the population do not always achieve significant results,” he said. “It also happens that countries afflicted by some of these pandemics find themselves held hostage, when they try to address them, by those who make economic aid conditional upon the implementation of anti-life policies.”
“It is especially hard to combat AIDS, a major cause of poverty, unless the moral issues connected with the spread of the virus are also addressed,” he said also. First and foremost, educational campaigns are needed, aimed especially at the young, to promote a sexual ethic that fully corresponds to the dignity of the person; initiatives of this kind have already borne important fruits, causing a reduction in the spread of AIDS. Then, too, the necessary medicines and treatment must be made available to poorer peoples as well. This presupposes a determined effort to promote medical research and innovative forms of treatment, as well as flexible application, when required, of the international rules protecting intellectual property, so as to guarantee necessary basic healthcare to all people.”
Pope Benedict highlighted child poverty especially.
“When poverty strikes a family, the children prove to be the most vulnerable victims: almost half of those living in absolute poverty today are children,” he said. “To take the side of children when considering poverty means giving priority to those objectives which concern them most directly, such as caring for mothers, commitment to education, access to vaccines, medical care and drinking water, safeguarding the environment, and above all, commitment to defence of the family and the stability of relations within it. When the family is weakened, it is inevitably children who suffer. If the dignity of women and mothers is not protected, it is the children who are affected most.”
The pontiff stressed the “relationship between disarmament and development. ”
“The current level of world military expenditure gives cause for concern. As I have pointed out before, it can happen that ‘immense military expenditure, involving material and human resources and arms, is in fact diverted from development projects for peoples, especially the poorest who are most in need of aid.’”
“This state of affairs does nothing to promote, and indeed seriously impedes, attainment of the ambitious development targets of the international community,” he added. “What is more, an excessive increase in military expenditure risks accelerating the arms race, producing pockets of underdevelopment and desperation, so that it can paradoxically become a cause of instability, tension and conflict.”
The pope cited “the current food crisis, which places in jeopardy the fulfillment of basic needs.”
“This crisis is characterized not so much by a shortage of food, as by difficulty in gaining access to it and by different forms of speculation: in other words, by a structural lack of political and economic institutions capable of addressing needs and emergencies. Malnutrition can also cause grave mental and physical damage to the population, depriving many people of the energy necessary to escape from poverty unaided. This contributes to the widening gap of inequality, and can provoke violent reactions,” he said. “All the indicators of relative poverty in recent years point to an increased disparity between rich and poor. No doubt the principal reasons for this are, on the one hand, advances in technology, which mainly benefit the more affluent, and on the other hand, changes in the prices of industrial products, which rise much faster than those of agricultural products and raw materials in the possession of poorer countries. In this way, the majority of the population in the poorest countries suffers a double marginalization, through the adverse effects of lower incomes and higher prices.”
He stressed the need for global solidarity and the fight against poverty.
“One of the most important ways of building peace is through a form of globalization directed towards the interests of the whole human family,” he said, noting “there needs to be a strong sense ofglobal solidarity between rich and poor countries, as well as within individual countries, including affluent ones.”
He cited natural law as calling us to global solidarity.
“Effective means to redress the marginalization of the world’s poor through globalization will only be found if people everywhere feel personally outraged by the injustices in the world and by the concomitant violations of human rights,” he said.
He spoke of international commerce and finance and voiced concern for processes “ dividing and marginalizing peoples, and creating dangerous situations that can erupt into wars and conflicts.”
“Since the Second World War, international trade in goods and services has grown extraordinarily fast, with a momentum unprecedented in history,” he said. “Much of this global trade has involved countries that were industrialized early, with the significant addition of many newly- emerging countries which have now entered onto the world stage. Yet there are other low-income countries which are still seriously marginalized in terms of trade. Their growth has been negatively influenced by the rapid decline, seen in recent decades, in the prices of commodities, which constitute practically the whole of their exports. In these countries, which are mostly in Africa, dependence on the exportation of commodities continues to constitute a potent risk factor. Here I should like to renew an appeal for all countries to be given equal opportunities of access to the world market, without exclusion or marginalization.”
The Holy Father voiced similar concern in the area of finance.
“Today this appears extremely fragile: it is experiencing the negative repercussions of a system of financial dealings – both national and global – based upon very short-term thinking, which aims at increasing the value of financial operations and concentrates on the technical management of various forms of risk,” he said. “The recent crisis demonstrates how financial activity can at times be completely turned in on itself, lacking any long-term consideration of the common good. This lowering of the objectives of global finance to the very short term reduces its capacity to function as a bridge between the present and the future, and as a stimulus to the creation of new opportunities for production and for work in the long term. Finance limited in this way to the short and very short term becomes dangerous for everyone, even for those who benefit when the markets perform well.”
Pope Benedict called for “an ethical approach to economics on the part of those active in the international market, an ethical approach to politics on the part of those in public office, and an ethical approach to participation capable of harnessing the contributions of civil society at local and international levels.”
He noted that globalization must include “giving priority to the needs of the world’s poor, and overcoming the scandal of the imbalance between the problems of poverty and the measures which have been adopted in order to address them. The imbalance lies both in the cultural and political order and in the spiritual and moral order. In fact we often consider only the superficial and instrumental causes of poverty without attending to those harboured within the human heart, like greed and narrow vision. The problems of development, aid and international cooperation are sometimes addressed without any real attention to the human element, but as merely technical questions – limited, that is, to establishing structures, setting up trade agreements, and allocating funding impersonally. What the fight against poverty really needs are men and women who live in a profoundly fraternal way and are able to accompany individuals, families and communities on journeys of authentic human development.”

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Filed under: consumerism, Economic Policy, Market Place, morals, Official Statements, Papal Teachings, Politics, Social Doctrine, Social Justice

FIGHT POVERTY, BUILD PEACE: Pope Benedict XVI World Day of Peace


VATICAN CITY, 11 DEC 2008 (VIS) – This morning Cardinal Renato Martino, President of the Pontifical Council for Justice and Peace, presented Benedict XVI’s Message for the XLII World Day of Peace in the Press Office of the Holy See. The theme of this World Day of Peace, which will be celebrated 1 January 2009, is “Fighting Poverty to Build Peace“.


Benedict XVI’s Message, said Cardinal Martino, “returns to and develops the Message of John Paul II for the World Day of Peace 1993, which explained the reciprocal connections and conditions existing between poverty and peace”. This time the Holy Father “shows us how peace and the fight against poverty intersect: a given that constitutes one of the most stimulating assumptions, giving a proper cultural, social, and political focus to the complex themes tied to the achievement of peace in our day, which is characterized by the phenomenon of globalization”.


Regarding globalization, the Pope emphasized “the methodological meaning and the content with which to face the theme of the fight against poverty in a broad and concrete manner” and to “analyze in depth these aspects in order to identify the multiple faces of poverty today”.


“The Holy Father above all”, the cardinal continued, “is taking into consideration the role of the social sciences to measure the phenomenon of poverty … which provide quantitative data and, if poverty were merely a material problem, they would suffice to explain its characteristics. However, we know that that is not the case: there are non-material forms of poverty that are not the direct and automatic consequence of material deprivation”.


“In advanced wealthy societies, the phenomenon of affective, moral and spiritual poverty is wide-spread: many persons feel marginalized and live with various forms of malaise despite their economic prosperity. This is what is known as ‘moral underdevelopment'”.


“The Pope’s message”, concluded the cardinal, “establishes two parts in the theme of the fight against poverty … it ties in with the diverse aspects promoting peace. The first deals with the moral implications tied to poverty; in the second, the fight against poverty is tied to the need the need for a greater global solidarity”.


Filed under: Official Statements, Papal Teachings, Social Doctrine, Social Justice

10 Shopping Days: Buy Fair Traded Gifts

Fair Trade: What Happens When You Buy from Catholic Relief Services
by John Lindner
Fair Trade is a easy way to give gifts to loved ones and help working poor families around the world. If you’re looking for gifts you won’t find on department store shelves, check out the CRS Fair Trade web site and blog.

When you buy Fair Trade, you:

– Celebrate the human dignity of the farmers who grew it;
– Demonstrate a special concern for the poor;
– Act in solidarity with our brothers and sisters in need overseas;
– Ensure that farmers earn a just wage;
– Contribute to a more just distribution of wealth;
– Practice responsible stewardship of Creation; and
– Promote the principle of subsidiarity.

But buying Fair Trade is not entirely selfless. After all, you get great products that are unique and received a lot of care in their production.

Filed under: Uncategorized

THOMISM: Framework for Moral Decision-Making…what do you think?

Vatican Official Considers Aquinas’ Comeback

Recalls How Morality Was Scorned in the 60s

By Antonio Gaspari

ROME, DEC. 3, 2008 ( ).- Moral theology based on St. Thomas Aquinas is among one of theology’s most popular branches today, says a Vatican official, but this popularity has come about only after decades of disdain.

Archbishop Jean Louis Bruguès, secretary of the Congregation for Catholic Education, spoke about his journey with moral theology when he delivered an address at a conference last Friday in Rome, which marked the 30th anniversary of the St. Thomas Aquinas International Society.

Archbishop Bruguès contended that “after May of ’68, moral theology, at least in France, fell into profound neglect.””During two years, the seminarians of Toulouse received no classes on this subject, considered disagreeable and boring, as no one was found who was willing to teach them,” he said. It fell to then Father Bruguès, a young priest with a doctorate in morality, to take up these courses.

The prelate recalled that his spiritual assistant, Father Michel Labourdette, tried to encourage him with these words: “You are concerned with a subject that today is disparaged, but have patience: The day will come when it will be envied by others.”

Indeed, Archbishop Bruguès noted, by the beginning of the 80s, many issues referring to ecology and the development of medical techniques began to be at the center of attention of bioethics.

“So, from one day to another, ethicists — that dreadful neologism coined to avoid saying ‘moralist,’ as the word ‘morality’ still caused fear — were in demand everywhere,” he said. “My professor had understood [the situation] well. Moral theology was becoming the most appreciated subject, the only branch of theology that was really taken into account in a secularized society.”

Archbishop Bruguès pointed out that in the 60s students were characterized by an essentially critical mentality.

“The very idea of making reference to the masters of Tradition stirred in them allergic reactions,” he quipped. “It was impossible even to mention the name of Thomas Aquinas: One ran the risk of having people plug their ears.”

Father Labourdette also offered advice in this regard, the Vatican official remembered, encouraging him to “always teach [Aquinas] but without mentioning his name.”

“Hence, for years I practiced so to speak an ‘amphibious Thomism,” recalled the archbishop, until “finally, one day […] they asked me for classes on the moral theology of St. Thomas: The time of ‘clandestine’ Thomism had ended.”

Archbishop Bruguès commented that “the generation of May ’68, which described itself as critical, rejected the transmission of Christian culture and tradition. The following generation was practically deprived of any Christian culture — it knew that it didn’t know. This led to not sharing the prejudices of their predecessors; now we can start again and share the great masters.”

The prelate proposed the Catechism of the Catholic Church as the text that best reflects this change.

The “Catechism is based on a conviction that further reflection is necessary: The great institutions of St. Thomas’ morality are the best instrument of critical dialogue with modernity,” continued the secretary of the Congregation for Catholic Education.

“The theory of virtue will stimulate a renewal of moral theology,” he affirmed, and thus “the teaching of moral theology stemming from the great institutions of Thomism, still has a luminous future before it.”

Filed under: morals