Pope Francis on the excesses of capitalism

[Pope Francis] has adopted a softer tone toward gay people, eschewed lavish features of the papal lifestyle, washed the feet of convicts and repeatedly called for greater efforts to lift up the world’s poor.

On Tuesday, he showed a willingness to use tough language in attacking what he views as the excesses of capitalism. ….

“Some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world,” Francis wrote in the papal statement. “This opinion, which has never been confirmed by the facts, expresses a crude and naive trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system.”

“Meanwhile,” he added, “the excluded are still waiting.”

Zachary A. Goldfarb and Michelle Boorstein, “Pope Francis denounces ‘trickle-down’ economic theories in critique of inequality“, The Washington Post, 26 November 2013.

I appreciate the pope’s concern with those left behind as the rich become richer, as well as his insistence that priests take seriously their vows of poverty, and minister to those less fortunate. None of these papal views are new. What is new is Pope Francis’ use of the term ‘trickle down’. This will ruffle more than a few feathers. Greg Mankiw, for example, reacted with these words:

[F]ree-market capitalism has been a great driver of economic growth, and … economic growth has been a great driver of a more moral society.

… “[T]rickle-down” is not a theory but a pejorative used by those on the left to describe a viewpoint they oppose. It is equivalent to those on the right referring to the “soak-the-rich” theories of the left.It is sad to see the pope using a pejorative ….

[A]s far as I know, the pope did not address the tax-exempt status of the church. I would be eager to hear his views on that issue. Maybe he thinks the tax benefits the church receives do some good when they trickle down.

Greg Mankiw, “The Pope’s Rhetoric“, 30 November 2013.

These are strong words. Mankiw asserts that unfettered capitalism leads to “a more moral society” and questions whether the church contributes to this goal.

It is possible to argue that capitalism, despite its many faults, is better than the alternatives. Mankiw chooses not to follow this line of reasoning. It is sad to see a Harvard economics professor describe capitalism as flawless and virtuous.

Greg Mankiw was adviser to two Republican politicians: President George W. Bush and presidential candidate Mitt Romney.

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