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Pope Francis and the End of 1% Capitalism

capitalism“How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points?,” Pope Francis asks in his 84-page apostolic exhortation, wherein he calls unchecked, free-market capitalism “a new tyranny.” The Holy Father has been expressing his anti-capitalist views since May, when he “hit out at unbridled capitalism and the “cult of money”, calling for ethical reform of the financial system to create a more humane society,” The Guardian reports.

In September, Francis spoke in front of a crowd of 20,000 in Sardinia, and said that joblessness and an ever-vanishing middle class are “not just a problem of Italy or of some countries in Europe.” He says, “It is the consequence of a global choice, an economic system which leads to this tragedy; an economic system which has at its centre an idol called money,” The Guardian notes. Sardinia has a 20% overall unemployment rate and an astonishing 51% youth unemployment rate. The paper says, “Last summer the island’s hardship became national news when Stefano Meletti, a 49-year-old miner, slashed his wrists on television during a protest aimed at keeping the Carbosulcis coal mine open.” What unthinkable horror.

Francis, who has demonstrated his extraordinarily compassionate, Jesuit nature time and time again since his election, is clever to attach the idea of “throwaway culture” to “a global economic system that care(s) only about profit.” He told the people gathered in Sardinia:

Grandparents are thrown away and young people are thrown away. And we must say no to this throwaway culture. We must say: ‘We want a fair system; a system that allows everyone to move forward.’ We must say: ‘We do not want this globalised economic system that does so much harm.’ At the centre has to be man and woman, as God wants not money.

In his recent philosophical dissertation, the Pope “warns that unequal distribution of wealth inevitably leads to violence.” He writes, “As long as the problems of the poor are not radically resolved by rejecting the absolute autonomy of markets and financial speculation and by attacking the structural causes of inequality, no solution will be found for the world’s problems or, for that matter, to any problems.” Haply, a new sect of business leaders agrees with him.

Chrystia Freeland writes for The Atlantic, “In Western capitalism circa 2013, fear that the market economy has become dysfunctional is not limited to a few entrepreneurs …. It is being publicly expressed, with increasing frequency, by some of the people who occupy the commanding heights of the global economy.” Several business leaders interviewed by Freeland know that their practices are unethical and that if the wealth of the 1% isn’t soon shared with the rest of us, there will be “social upheaval.” David Blood, a former head of Goldman Sachs Asset Management, says, “We are creating a situation in which only the elite of the elite can be successful—and that is not sustainable.” Kurt Landgraf, the former president and CEO of DuPont Merck, says, “We have so many people who are suffering. If we don’t do something to change the trajectory of the economy,” people will eventually become “advocates for more-extreme change.”

Dominic Barton, the global managing director at McKinsey, “the trusted advisor and counselor to many of the world’s most influential businesses and institutions,” per their website, says capitalism got off track in 1970 “when Milton Friedman first advocated maximizing shareholder value as the paramount duty of the chief executive. That notion—which reduced issues like employee well-being to ‘externalities’ that shouldn’t concern a company’s manager—helped catalyze a divorce of business from society,” Freeland writes. Friedman has been called “the great-granddaddy of Reaganomics,” also known as trickle-down economics. Steve Denning, in a Forbes column, says Friedman is the origin of the world’s dumbest idea, and Denning thinks that “shareholder value” will stop being the main objective of big business as early as 2014.

Until then, Pope Francis says, “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. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system. Meanwhile, the excluded are still waiting.”

Photo credit: Flickr user Semilla Luz

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