Mr J.F.X Zahra's article appears weekly on Newsbook.
I was invited to chair a panel during an International Consultation Meeting organised by theFondazione Pro Pontifice Centesimus Annus in the Vatican at the end of September with the title “The Debt Crisis, Financial Reform and the Common Good”. I reiterated my views during the opening of this panel discussion that the financial and economic crisis is a result of failures on the part of everyone – the financial sector and the market, consumers and the state.
For more than a decade the developed world but also the emerging economies were on a frantic run to make more money, to consume more and for Government’s to retain the status quo on waste, inefficiencies and misallocation of resources for the sake of political expediency and popularity.
Business and banks were motivated by the anglo-saxon model of maximising return on capital, consequently to push up share prices. Meanwhile executives were getting huge bonuses from higher performance and higher profit. Innovation was being encouraged in all sectors including in the financial sector, with new banking and financial products that no one really understood. The critical factor here is the abuse of creativity and innovation – an example when innovation was harmful rather than constructive.
Consumerism is still profane and wasteful. Logos and brands are more important than utility and substance. Peer group pressure created more problems as consumers are living on credit provided by the banks, charging high interest rates and hypothecating properties and assets. The most serious issue here is the creation of a “nouveau riche” who is devoid of humanity and completeness. This is a flat anonymous being that reacts neurologically to stimulus by marketers, but who lacks the roundness and the 360 degrees nature of humanity.
The State has also to take the blame. Politicians were (and still are) there to please the electorate through trivial and temporary promises, without looking into the long term consequences of their decisions and actions. Reforms in the social welfare system that are so essential to eliminate waste, misuse and abuse, are there waiting to be implemented but no decision is taken since any change is unpopular and will mean loss of votes.
Angelo Cardinal Scola described this in his address to the members of the Fondazione Pro Pontifice Centesimus Annus in Milan in May 2012, as a “sort of cultural paralysis... with little propensity, even on the part of public institutions to plan for the future; growing preference for temporary revocable relationships instead of stable ones; need interpreted exclusively as a right to well being to be satisfied through consumption”.
May I ask a few questions? Can the current economic crisis be an opportunity to chart a new course which is more respectful of the human person? As we have seen, Profit (which is useful), can still create poverty... how can we ensure that Profit will always be to the benefit of humanity?
The answer to these questions lies in the underlying principle that human development requires both “material growth” and “spiritual growth”.
Catholic social teaching has an answer to these questions– the pursuit of the Common Good (read here human development through respect of human dignity) by means of subsidiarity (where decisions need to be taken at the lowest competent level, read here the relevance of civil society probably much more respected than politicians are today) and solidarity (the only means to eliminate inequality).