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Mainstream, VOL LII No 1, December 28, 2013 - ANNUAL 2013

The Economics of Pope Francis

Sunday 29 December 2013, by Ambrose Pinto

The Catholic Church is the largest denomination among Christian churches with a membership of more than 1.2 billion.1 Its membership is scattered across the globe with a large institutional presence. The Pope as the Head of the Catholic Church not only commands respect among the Catholics but is held in high esteem by people of other faiths as well. As a global leader, his message does influence educational and social institutions established by the church. These Catholic educational, theological, social and other institutions from primary to the universities and centres of social sciences across the globe derive inspiration from the papal teachings. The church is also involved in grassroots movements.

After several traditional Popes, the Church has a very progressive Pope, the first Jesuit2 to occupy the position and the very first person from Latin America. Though not expected to be Popes and Bishops, the Jesuit Order, due to its loyalty to the Church, accepts ecclesiastical appointments with reluctance and not by choice. Pope Francis has been a reluctant Pope; he hails from a religious order known for reforms. His life and pronouncements have been creating waves across Europe, the United States and several Latin American countries. Hailing from Latin America with deep experiences of living with the poor and reflecting on their lives, his message is down to earth. He has made the church bureaucracy uncomfortable as well, pointing out that reforms and change should begin from the witnessing lives of those who exercise leadership in the church. More than a teaching Pope, he comes across as a witnessing Pope. In a remarkable shift from previous Popes, he has chosen not to live in the Vatican palace, to give up the pomp and grandeur of the office, wear simple clothes and make use of an old car.

Evangelii Gaudium (Gospel of Joy)

In a recent 50,000 word statement popularly known as “exhortation” in Church circles titled “Evangelii Gaudium” (Gospel of Joy), he has announced the manifesto of the Church for the establishment of a new world, a world of equity and justice. A papal exhortation3 is an official statement issued by the Vatican that ranks below formal encyclicals. The Exhortation, which some have even termed as the “magna carta” of the Pope for the Church, is primarily a focus on the poor and a denunciation of the structures that hinder primacy to the masses.

At the same time the document has a vision for the Church as an institution that should act for, and on behalf of, the dispossessed—a vision that owes a lot to Saint Francis of Assisi, the thirteenth-century Italian who renounced his inheritance to tend to the poor. In Buenos Aires, Bergoglio’s (the Pope’s original name) latest biographer, Paul Vallely, has said that the Pope was known as “Bishop of the Slums” there. On taking Francis’s name and entering the Vatican, he has said he wanted “a poor Church, and for the poor”.

Not that the Church has not been with the poor. Catholic priests, nuns and lay workers the world over have long toiled for the poor. However the Church hierarchy had studiously avoided critiquing the political and economic system that generates poverty and inequality. When such a critique did emerge from within the Church, during the 1960s and 1970s, in the form of “liberation theology”,4 the Vatican had stamped down on it. Cardinal Joseph Ratzinger,5 who was the head of the department of doctrine and who eventually became Pope Benedict XVI, had played a prominent role in the suppression of the liberation theology. Pope Francis seems intent on revisiting this debate. In the part of the exhortation devoted to economic matters, he resurrects, and appears to endorse, many of the themes of liberation theology.

Economic Theories have a Pro-rich Bias

Whether it is liberalism, neo-liberalism or the rhetoric of mixed economy, all these leading economic theories have an implicit pro-rich bias. The Pope is clear on this. The governments’ economic policy aims first and foremost at GDP growth, that favours the wealthy and the rich who take a proportionately higher portion of additional production. The former Archbishop of Buenos Aires, who was well known for spending time in the slums and distributing food, offers specific recommendations of how to reorient real world economic activity to be pro-poor. Finance is an obvious target. He argues against the toleration of speculation, the merciless pursuit of debt repayment and the unhealthy hunger for profits.

In his perspective money and credit should unify society and promote the common economic good. What they do presently is that they divide and diminish. His basic question is the reason for the very existence of companies and corporations. The Pope has a wise answer. He would like executives to “see themselves challenged by a greater meaning in life”,6 a calling which comes with a material purpose, “to increase the goods of this world and to make them more accessible to all7.” The approach is quite a contrast with the rather pro-rich current tenets of management theories that say businesses should maximise the shareholder value. Public good is the core of business for the Pope.

Attack on Trickle-down Theory

The strongest attack of the Pope is on free markets that 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.

“...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. To sustain a lifestyle which excludes others, or to sustain enthusiasm for that selfish ideal, a globalisation of indifference has developed. Almost without being aware of it, we end up being incapable of feeling compassion at the outcry of the poor, weeping for other people’s pain, and feeling a need to help them, as though all this were someone else’s responsibility and not our own. The culture of prosperity deadens us; we are thrilled if the market offers us something new to purchase. In the meantime all those lives stunted for lack of opportunity seem a mere spectacle; they fail to move us.”8

This is a strong political stand against Right-leaning, pro-free-market economic policies. In pitting the Church against the free market, the Pope has added significant heft and legitimacy to progressive, pro-government groups on the Left. Officially the Pope has declared a new enemy, the neo-liberal economy and he is building on the foundation set by the anti-capitalist critics who took to the streets and continue to protest. “In this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule,” says the Pope. “All this becomes even more exasperating for the marginalized in the light of the widespread and deeply rooted corruption found in many countries — in their governments, businesses and institutions — whatever the political ideology of their leaders. To assume that trickle down capitalism is sufficient to establish social/economic justice and prosperity in and of itself, turns the free market into a god. A theory that makes profit the exclusive norm and ultimate end of economic activity is morally unacceptable,” he opines.

Attack on Growing Inequality

The document is incredibly direct in its call for specific, policy-level action to fight institutional inequality rather than speaking broadly and loftily about poverty as some kind of abstraction or something to be addressed exclusively by charitable giving at the community level, as some of his predecessors have been content to do. He has decried an “idolatry of money” and warned that it would lead to “a new tyranny”.

The Papal language is tough on the excesses of capitalism. He has hit hard on the corporations and condemned economic theories that are affiliated with conservatives—that discourage taxation and regulation. He simply does not accept a popular version of the conservative economic philosophy which argues that
allowing the wealthy to run their businesses unencumbered by regulation or taxation bears economic benefits that lead to more jobs and income for the rest of society. He has asked global leaders to fight poverty and growing inequality by being accountable.

Addressing growing inequalities, he has said: “The earnings of a minority along with the gap separating the majority from the prosperity enjoyed by those happy few are growing. “This imbalance, the Pope attributes to the ideologies which defend the absolute autonomy of the marketplace and financial speculation. “Conse-quently, neo-liberal Sates reject the right of states, charged with vigilance for the common good, to exercise any form of control. A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules. Debt and the accumulation of interest also make it difficult for countries to realise the potential of their own economies and keep citizens from enjoying their real purchasing power... The thirst for power and possessions knows no limits.”10 The consequences are there for all to see. Countries are becoming more and more unequal and more and more people are pushed out of development. Those who are in-charge, the corporations, are not moved by the plight of the excluded.

Attack on the Economy is Moral

The core of the Pope’s critique is moral and not economic, and that is what gives it its power. Referring once again to the idolatry of money, he writes: “Behind this attitude lurks a rejection of ethics and a rejection of God. Ethics has come to be viewed with a certain scornful derision. It is seen as counterproductive, too human, because it makes money and power relative. It is felt to be a threat, since it threatens the manipulation and debasement of the person. In effect, ethics leads to a God who calls for a committed response which is outside the categories of the marketplace. Money must serve, not rule! Those rich must help, respect, and promote the poor”.

He calls for a generous solidarity and to the return of economics and finance to an ethical approach which favours human beings. In the Papal understanding goods of the earth are to be shared and not to be accumulated, human beings accumulating at the expense of other humans.

Critics of the Exhortation

Those in social movements, grassroots involve-ment, concerned academicians and political leaders have hailed the document. Even President Obama was quick to endorse the Papal attack on trickle-down economics. “Some of you may have seen just last week the pope himself spoke about this at eloquent length,” Obama had said at an event for the Centre for American Progress. “How can it be, he wrote, that it’s not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points? But this increasing inequality is most pronounced in our country. And it challenges the very essence of who we are as a people.”

“The problem is, that alongside increased inequality, we’ve seen diminished levels of upward mobility in recent years,” President Obama had added. “A child born in the top 20 per cent has about a two in three chance of staying at or near the top. A child born into the bottom 20 per cent has a less than one in 20 shot at making it to the top. He’s 10 times likelier to stay where he is.”11

Not that there are no critics. In stressing the themes of exclusion and inequality, and in pointing out the awkward fact that these phenomena can result in fatalities, the Pope surely knew he would raise some hackles, and he did. James Pethokoukis, a blogger at the American Enterprise Institute, while conceding that the Pope’s words “are excellent cause for reflection”, went on to say that they “should not obscure the reality that innovative free enterprise is the greatest wealth-generator ever discovered and the economic system most supportive of human freedom and flourishing”. Pethokoukis cited a new research note by James E. Glassman, an economist at J. P. Morgan Chase, which featured graphs showing the sharp rise in GDP around the world over the past century, and which concluded: “The global community has much to be thankful for and modern market-oriented economies deserve considerable credit for the battle against global poverty.”12

To some extent, though, Pope Francis appears to have foreseen this counter-argument. In his exhortation, he doesn’t contest the fact that global capitalism is uniquely productive. His argument is that the material progress that accompanies the expansion of the market is based on the exclusion and suffering of the powerless, and that this is immoral.

Rush Limbaugh along with those of his school has labelled Pope Francis a Marxist. “In its recognition of the universality and power of the market, its self-sustaining ideology, its asso-ciation with rising inequality, and its dehu-manizing aspect, parts of the Pope’s analysis do resemble those of the man his friends called the Moor, and his cohort Friedrich Engels. But the Argentine Pope isn’t just a priest who swallowed bits of The Communist Manifesto—the more acute bits. Parts of his argument also hark back to the anti-growth and anti-consumerism movements of the sixties and seventies, which have recently seen a rebirth in many parts of the advanced world, particularly among the young.” Some conservative economic commentators, while stopping short of echoing Limbaugh’s words, have accused the Pope of misrepresenting global capitalism, and ignoring its role in wealth creation. There are other opponents who have said that the Pope is no economist and he should make no statement on economics as if economics belongs to the realm of the specialists.

In fact, it is the ordinary people who should speak about economics as a result of the impact of the market policies on their lives. Theories can be shaped in classrooms but their impacts are on the streets and ordinary homes. The Pope has only articulated the impacts of the market economy on the masses.

Read the Scriptures from Below

In asserting the primacy of the underdog, and the need to interpret scripture from the under-dog’s perspective, Pope Francis was echoing arguments made by Latin American priests during the 1970s, such as the Peruvian Gustavo Gutierrez, Leonardo Boff of Brazil, George Suares and Kappen of India. But the pontiff also goes beyond old-school liberation theology. The poor aren’t the only victims, he argues. The system’s prosperous winners also get dehumanised and debased, albeit in a more subtle way. Just as the commandment “Thou shalt not kill” sets a clear limit in order to safeguard the value of human life, today we also have to say “Thou shalt not” to an economy of exclusion and inequality. Such an economy kills.13

Economics and religion go together. They are competing for the loyalty of individuals and the system. They both try to explain the motivation for our individual actions. Economics under-stands choice in terms of utility or profit maximisation and pleasure, while the Pope has made clear, especially in his recent exhortation, that he is offering the joy of living.

Economics thinks in terms of relative scarcity and choice while the pope thinks in terms of deprivation and exclusion. They are both dealing with the same choices but from opposing points of view. Pope Francis takes on the economists, who he exhorts to ensure “the return of economics and finance to an ethical approach which favors human beings”. The Pope blames a deadening income inequality on “ideologies which defend the absolute autonomy of the marketplace and financial speculation”. Inequality will lead to violence “because the socio-economic system is unjust at its root”.

The economists are unlikely to accept the Pope’s critique. They are more likely to snicker at what they see as the pope’s lack of understanding of economics. It would not occur to them to seriously consider that they could be wrong. Such arrogance is dangerous.

Politics can be Constructive

Then there are politicians. The general image of the politicians has got a beating. The image is no more positive. But the Pope in no way condemns politicians. He says: “Politics, although often denigrated, remains a lofty vocation and one of the highest forms of charity. I beg the Lord to grant us more politicians who are genuinely disturbed by the state of society, the people, the lives of the poor!” It is perhaps significant that Francis asks for divine help for this cause. He may think mere human action will just produce more leaders whose main concern about the poor is how they vote. Political leaders can lead the way, even without fully following the papal injunction to end their blind trust in the invisible hand of the market.

Francis provides a quite realistic agenda: policies geared to a better distribution of income, the creation of sources of employment and an “integral promotion” of the poor. A good start would be to root out any old ideas which amount to an integral promotion of the rich.

Focuses on the Church that is Poor

Returning to his vision of a Church that is poor and for the poor, the Pope urges to pay particular attention to those on the margins of society, including the homeless, the addicted, refugees, indigenous peoples, the elderly, migrants, victims of trafficking and unborn children. Terming trafficking and new forms of slavery, the Pope says that “this infamous network of crime is now well established in our cities, and many people have blood on their hands as a result of their comfortable and silent complicity”. “Among the vulnerable for whom the Church wishes to care with particular love and concern are unborn children, the most defenceless and innocent among us. Nowadays efforts are made to deny them their human dignity.” “The Church cannot be expected to change her position on this question ... it is not ‘progressive’ to try to resolve problems by eliminating a human life.” “For the Church, the option for the poor is primarily a theological category rather than a cultural, sociological, political or philosophical one. God shows the poor ‘his first mercy’. This divine preference has consequences for the faith life of all Christians, since we are called to have ‘this mind... which was in Jesus Christ.’ Inspired by this, the Church has made an option for the poor. It ‘is implicit in our Christian faith in a God who became poor for us, so as to enrich us with his poverty’. This is why I want a Church which is poor and for the poor.” “They have much to teach us. We need to let ourselves be taught by them. We are called to find Christ in them, to lend our voice to their causes, but also to be their friends, to listen to them, to speak for them and to embrace the mysterious wisdom which God wishes to share with us through them.” “As long as the problems of the poor are not radically resolved ... no solution will be found for this world’s problems.” He adds an admonition: “Any Church community,” if it believes it can forget about the poor, runs the risk of “breaking down”.


The Pope further says: “Humanity is experiencing a turning point in its history, as we can see from the advances being made in so many fields. We can only praise the steps being taken to improve people’s welfare in areas such as health care, education and communications. At the same time, we have to remember that the majority of our contemporaries are barely living from day to day, with dire consequences. A number of diseases are spreading. The hearts of many people are gripped by fear and desperation, even in the so-called rich countries. The joy of living frequently fades, lack of respect for others and violence are on the rise, and inequality is increasingly evident. It is a struggle to live and, often, to live with precious little dignity.”14

What impact will this document have on the global society? While there are some who say that the Papal document would shape the thinking of today’s more than 1.2 billion Catholics, there are others who state that the document would provide impetus to all those who believe that another world is possible. An official document of the Church would impact thousands of universities, social centers, media organisations and people who are beneficiaries of Church education. One expects the document to impact all those working for a people’s economy. While we need an international human solidarity among people, the need is to break the nexus between states and markets, decentralize markets and work see that the markets work for people instead people being used, misused and abused by the markets.


1. Catholics number 1.2 billion. Estimates of the total number of Protestants are very uncertain, partly because of the difficulty in determining which denominations should be placed in the category. It seems however clear that Protestantism is the second largest major group of Christians after Catholicism by number of followers. Often that number is put at 800 million. However, the 33,000 Protestant denominations in the world differ vastly to slightly theologically and do not form a single communion.

2. The Jesuits (or Society of Jesus) are members of a religious order founded by Saint Ignatius Loyola, a soldier turned saint. They became the main instruments of the Counter-Reformation. For the historians they are the torch-bearers of the counter-reformation though the order was not founded with the avowed intention of opposing Protestantism. The early Jesuits were sent at the special request of the Pope to Germany, the cradle-land of the Reformation, at the urgent solicitation of the imperial ambassador. Called at times as “Soldiers of the Church” they have been in the forefront of church’s renewal. Committed to thought and formation across the world they administer the church’s best higher educational institutions in Rome, Europe and the USA. In India the top Catholic colleges like St. Xavier’s—Mumbai, Kolkata, Ranchi and Ahmadabad, Loyola in Chennai, St Joseph’s in Bangalore, XLRI in Jamshedpur and others are administered by the members of the Order.

3. An exhortation is a type of communication from the Pope. Like the directive principles of the Indian Constitution, they are directives to the church but they do not define Church doctrine. It is considered lower in formal authority than a papal encyclical which is a part of doctrine, but higher than other ecclesiastical letters. 

4. Liberation Theology is an attempt to interpret Scripture through the plight of the poor. It started in South America in the turbulent 1950s and was bolstered in 1968 at the Second Latin American Bishops Conference which met in Medellin, Colombia. The idea was to study the Bible and to fight for social justice. Since those who had money were very reluctant to part with it in any wealth redistribution model, the use of a populist (read poor) revolt was encouraged by those who worked most closely with the poor. Because of its Marxist leanings, Liberation Theology was criticized in the 1980s by the Catholic hierarchy, from Pope John Paul accusing liberation theologians of supporting violent revolutions and outright Marxist class struggle. The criticism was not fully right. Liberation theology had much to do with the reflection on the life and death of Jesus who is termed as a liberator. The Liberation Theology however has moved from the poor peasants in South America to the poor blacks in North America trying to stir up revolutionary fervor among blacks in America. There are number of teachers of theology in India who make use of it in their classrooms.

5. During the 1980s and 1990s Benedict, then Cardinal Joseph Ratzinger, acted as John Paul II’s doctrinal czar. “This conception of Christ as a political figure, a revolutionary, as the subversive of Nazareth,” the Pontiff once said, “does not tally with the church’s catechism.” In 1983 the Pope wagged his finger at Sandinista government minister and Nicaraguan priest, Ernesto Cardenal on a trip to Managua, warning the latter to “straighten out the situation in your church.” Cardenal was one of the most prominent Liberation Theologians of the Sandinista era. Originally a liberal reformer, Ratzinger changed his tune once he became an integrant in the Vatican hierarchy. As prefect of the Congregation for the Doctrine of the Faith, the Vatican’s doctrinal watchdog agency, Cardinal Ratzinger warned against the temptation to view Christianity in an exclusively political light. Liberation Theology, he once said, was dangerous as it fused “the Bible’s view of history with Marxist dialectics.”

 Calling Liberation Theology a “singular heresy,” Ratzinger went on the offensive. He blasted the new movement as a “fundamental threat” to the church and prohibited some of its leading proponents from speaking publicly. In an effort to clean house, Ratzinger even summoned outspoken priests to Rome and censured them on grounds that they were abandoning the Church’s spiritual role for inappropriate socioeconomic activism. As Pope, Ratzinger had not sought to hide his lack of esteem for Liberation Theology. During a trip to Brazil, he was pressed by reporters to comment on Oscar Romero’s tragic murder in El Salvador. The Pope complained that Romero’s cause had been hijacked by supporters of liberation theology. Commenting on a new book about the slain archbishop, the Pope said that Romero should not be seen simply as a political figure.

6. gaudium_en.html

7. Evangelii Gaudium, page

8. 20131124_evangelii-gaudium_en.html

9. Ibid.

10. exhortations/documents/papa-francesco_esortazione-ap_ 20131124_evangelii-gaudium_en.html

11. cfm?storyid=19883


13. exhortations/documents/papa-francesco_esortazione-ap_ 20131124_evangelii-gaudium_en.html

14. exhortations/documents/papa-francesco_esortazione-ap_ 20131124_evangelii-gaudium_en.html

Dr Ambrose Pinto SJ is the Principal of St. Aloysius Degree College, Bangalore.

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