Father Robert Sirico has travelled a long twisty road from the left end of the political spectrum to the right and from a Catholic upbringing, to Protestant dabblings, to prodigal wanderings and back again to Catholicism and the priesthood.
Sirico (yes, brother to Tony of the Sopranos) caught my attention a few weeks ago in an interview sparked by the publication of his latest book, Defending the Free Market: The Moral Case for a Free Economy. It struck me as an odd topic for a Catholic priest, but he deftly and charmingly defended his view that free markets are not only most efficient, but most moral. Yes, an odd topic for a priest, but even odder for a man who counted Tom Hayden and Jane Fonda as close friends and fellow activists during the Vietnam Era. So of course, I rushed right out and bought his book. Such colorful characters and their writings tend to invite closer scrutiny.
As a result of his own inward and outward scrutinizing, Sirico finally made the Catholic Church he was born into the house of his spiritual rebirth and also where he would spend his days as pastor, teacher, researcher and writer. His political conversion was hardly less life changing. Though he claims no affiliation with any political party, he helped found The Acton Institute, an organization that for more than two decades has been dedicated to studying religion, liberty and the practical effects of world markets on poverty and human rights.
Freedom and Property Rights
At the basis of Sirico’s contention that free markets are most moral is his belief in the principle that other human rights diminish when people are not free to own property. In this he echoes Austrian economist, Frederich Hayek. It’s no secret that we humans long for freedom and will go to great lengths to achieve it and protect it. And there is no doubt freedom can be and often is used selfishly. He says, “The free enterprise system isn’t perfect, of course, for the simple reason that human beings aren’t perfect. Every vice you see among human beings, you will also see in the markets they create.” But Sirico points out that an atmosphere of freedom is also the best breeding ground for the human creativity that benefits untold millions. Think Louis Pasteur. Think the Wright brothers. Think Thomas Edison.
Conversely, it is the political movements that have accomplished the “abolition of private property” practiced at various times and in various places throughout world history (and more contemporarily in the USSR, communist China, North Korea, Cuba, etc.), that have established “many of the most brutal regimes in the twentieth century.”
In free societies, where people can own property and the rule of law protects against theft and other violations, trades that benefit each party can take place.
As kids, we learned all about this going through our Halloween candy. Some liked Snickers bars and some liked M&Ms. It was mutually beneficial to trade until everyone got more of what he or she wanted. It’s what happens when we go to the grocery store, or the car dealership, or to a doctor’s office or to work, except we use currency as a means of exchange. We trade our skills or labor for money and then that money for what is valuable to us. It happens in small businesses and big ones. A product or service is offered that provides value, determined by the customer. The dollars that go into the business feed and house the business owners, the employees, the vendors and a host of others. Sometimes businesses also give away dollars, so people who aren’t integral to its operation benefit as well. Additionally, tax dollars from the business provide societal benefits, again not necessarily to those integral to the operation.
Sirico explains that because the U.S. market is relatively free, everyone – customer, supplier, employee and employer – is able to walk away from a transaction if it is not beneficial. Customers can go to a competing business for a better product or a cheaper price. Suppliers can refuse to sell to businesses that fail to meet their financial obligations. Employees that don’t like their working conditions or pay can search for another job. Employers can replace employees that drain company resources instead of enhancing them. Because the U.S. market is also protected by the rule of law, there is legal recourse for any party with a grievance.
Families, mom-and-pop businesses, huge corporations and countries are markets, from tiny to global and they mesh together in ways that are complicated and would be hard to plan even if they were completely understood. The system is greater than the sum of its parts because value, creativity and ingenuity are added along the way and resources, by virtue of their relative demand and relative scarcity, are utilized with efficiency and economy because people in the market are free to flex and seek the highest benefit.
Poverty and Charity
Freedom, according to Sirico, is the foundation for the antidote to poverty. Charity is part of the answer he says. As a Christian, Father Sirico can’t and won’t ignore Scripture on this point, but says charity is only part of the solution and it doesn’t always take the form we envision. Sometimes it seems easier to give money than the type of interaction and assessment that will provide more than temporary relief (i.e. the idea of giving a man a fish versus teaching him how to fish.)
Sirico say that if you really want to help the poor, don’t just throw money or aid. Instead, start a business and involve individuals’ talents, creative abilities and desire for dignity and actualization. Poverty is more than lack of means and its remedy is more than wealth.
To prove his point that free markets bring the jobs that pull people out of poverty more than entitlements and charity, he details several examples in his book, one of which is the industrialization that took place various places around the globe starting in 1800. From that year until 1950, he says poverty decreased by half and by half again between 1950 and 1980. During the same period, world population increased from one billion to seven billion.
The Fixed Pie
Sirico further uses these statistics to introduce a section entitled The Fallacy of the Fixed Pie. Although he recognizes the continued existence of poverty, he believes that statistics like the one just mentioned prove that freedom and creativity applied to wealth-making produces bigger pies and more pies for everyone to share in and negates the idea that the world’s pie is fixed and we humans are doomed to smaller and smaller portions as populations increase.
He says the disconnect comes in thinking politically versus dynamically, “In politics, the pie is fought over to determine who gets what portion of the pie; in the market, the pie can grow.”
Political solutions to address poverty outside national borders tend toward foreign aid and again, there is usually a fight. Politicians struggle to determine how their idea of the fixed pie should be distributed. For Sirico, foreign aid’s lack of effectiveness and moral questionability makes it not worth the political fight. Just how successful is foreign aid in helping the world’s poor? According to Sirico’s Acton Institute, not very. Natural disaster’s aside, foreign aid does little to address true need. What developing countries must have is freedom to incubate innate human creativity and the rule of law to protect those creative efforts from government corruption and immoral opportunists.
According to Sirico, there are two primary problems with foreign aid and a host of lesser ones. First, where freedom and property rights do not exist, foreign aid does nothing to help the poor. It facilitates the luxurious living of the corrupt. Sirico quotes British economist Peter Bauer on this subject, “Foreign aid is a process by which poor people in rich countries help rich people in poor countries.”
Second, indiscriminate foreign aid is responsible for wiping out some local industries in developing countries. For example, second hand clothing flowing from the U.S. and Canada in the ‘70s and ‘80s killed the cotton industries in Kenya. A solar power plant in Haiti died when aid groups provided free solar technology in the wake of the 2010 earthquake. And former President Bill Clinton believes providing subsidized U.S. rice to Haiti during his administration was a disaster for Haiti’s agricultural economy.
As controversial as any economic discussion is bound to be, one topic more than most may rouse some ire. It’s that of creative destruction.
Using a horticultural illustration, Sirico tells of the time he returned to his religious community and seeing what he thought was the ruination of the beautiful holly bushes surrounding the property. Another priest had spent the day whacking away at them. As it turned out, that priest who grew up farming understood the concept of pruning. What looked severe and damaging to Sirico was ultimately a therapeutic and preserving measure.
Sirico says that as hard and painful as pruning is, it must be allowed to take place in markets. When Henry Ford introduced his Model T, it meant the end (or at least severe curtailment) of saddle makers and buggy makers. Suddenly, farriers and stable boys were job hunting and re-inventing themselves, perhaps as autoworkers, mechanics and gas station attendants. For those affected by creative destruction, the process can be wrenching, but in the end the process creates new possibilities. How many of us are in fields our parents or grandparents never imagined? How many of our children and grandchildren will be doing jobs we haven’t yet imagined?
For this reason, Sirico doesn’t support bailouts of failing industries. He believes we are all too ready to give up freedom to government control in exchange for a pseudo security that ultimately hurts markets and slows new job creation.
Despite the pain of creative destruction in layoffs and downsizing, Sirico thinks the alternative is worse. Eliminate the “positive results of even a hundred years of creative destruction … and the result would be the swift death of literally billions of human beings.”
Help in Times of Need
What is the solution for easing the very real hardships of those experiencing unemployment or underemployment? Aside from creating a truly free market and eradicating taxation punitive to job-creating businesses, Sirico points out that God clearly demonstrates throughout Scripture that we are our brothers’ keepers. Administering help, for example, through a church or other service organization, is personal and meets social, emotional and spiritual needs as well as material ones. Dealing with needs on a smaller, more personal basis also weeds out potential fraud and provides for needs in more precise ways.
Even so, Sirico recognizes obstacles to this, namely that people turn first to government for help and churches often abdicate their societal responsibility. It’s partly a question of which has come first. Did welfare expand because churches failed or have churches given up because they can’t compete with programs that require little accountability and perpetuate entrenched poverty by providing long-term entitlements?
Greed is another topic that arises when people talk about capitalism. Sirico’s chapter on the subject sets out to debunk the notion that greed is the foundation for free markets, noting that it is simply a consequence of fallen natures and will be evident in any market, free or controlled. Greed is any normal desire that becomes inordinate and can be focused on things both material and immaterial. The result of greed unhindered is avarice, the attempt to obtain those inordinate desires “without regard to others.”
While greed and avarice can and do exist in free markets, property rights and the rule of law are in place to prevent victimization and to bring justice when it occurs. And strange as it may seem, the greedy can get rich while still providing useful and beneficial products and services. Prosecution is a negative motivation for the greedy to stay within the bounds of law, but positive motivations exist as well. Giving away money and services is tax deductible in most cases and it improves public images for businesses and creates philanthropic reputations for individuals.
While still on the subject of greed, Sirico addresses the supply of resources and pricing. Isn’t it immoral and greedy to set prices on goods and services so high that people who need them can’t afford them? That is one frequently heard complaint about the free market. Pricing is simply a way of allocating resources. In a free market, the scarcer the resource, the higher the price. Lower prices indicate either abundance of product or low demand for it. Market determination of pricing may not be equitable, but it is indiscriminate. Discrimination is based in human subjectivity, but truly free markets are innately objective.
What happens in controlled markets where legislative bodies or government agencies and executives fix prices on goods and services? Pricing is subjective and cannot accurately reflect scarcity and demand. If goods or services are scarce, fixing their prices, in an attempt to make them available to more people, doesn’t make them less scarce, but it will create shortages, black markets and corruption in governing agencies. It does nothing to level the playing field and create the equality it purports to effect.
Equality Idolatry and Redistribution of Wealth
Speaking of equality, Sirico believes it is socialism’s golden calf. We worship and hail the nice ring it has to it, but the practical result is ultimately the imposition of “straitjacket sameness on everyone.” Furthermore, he lambasts the Occupy crowd for making no effort to distinguish among the upper one percent the difference between those “who grew rich from serving the 99 percent conscientiously and effectively” versus the swindlers and those in bed with government insiders. He bets they keep buying their Apple products because they find them useful and valuable despite the earnings that put Apple in the despised category.
At one time, Sirico was a progressive and thought redistribution of wealth was the humane answer to the problems of poverty. Now he says that redistribution of wealth, while sounding noble and generous, would be disastrous and cause untold suffering.
Confiscating the wealth of the world’s upper one percent would translate into about $13,000 for every person on the planet. After everyone got finished eating and spending his way through that amount in a relatively short period of time, the proverbial you-know-what would hit the fan because most of that top one percent of wealth is invested in businesses which would suddenly be dismantled, along with the jobs they create. Doing this would create a nuclear winter of the global economy.
Theology For Economic Man
Of course, there is much more to this book and I’ve highlighted only a few points. Sirico includes chapters such as Why State-Sponsored Health Care Is Not Compassionate and Caring For The Environment. He ends with A Theology For Economic Man, the premise of which is that despite being fallen in nature, humans are motivated by deeper desires than sensual gratification. Created in God’s image with spiritual capacity, humans properly connected to their Creator, are called to bring dignity and the culture of Heaven to all their pursuits, including work, be that changing a baby’s diaper, sacking groceries, farming fields that feed nations or administering complex organizations.
Although we have the potential for both virtue and vice, Sirico says, “Freedom is indispensible to the flourishing of a virtuous society … without virtues … we are susceptible to either of two temptations: to seek tyranny over others or to permit tyranny over ourselves, often because we idolize security and material comfort.”
Just before reading Father Sirico’s book, I finished one published a few years ago by Alan Hirsch. The Forgotten Ways, which discusses reasons for and antidotes to the decline of the Church in the West, is far different than Sirico’s, but some of its closing analyses draw some interesting parallels.
While Hirsh believes that consumerism (the striving for comfort and ease) trumps any other religious challenge in threatening the complete demise of Western Christianity, he also says that the nation-state has replaced God as “the mediator of protection and provision” and the middle class ideal of safety and security. Sirico would not disagree that consumerism threatens the theology of economic man, but he would seem to emphasize a greater threat in the ever-increasing relinquishment of freedoms to government in exchange for its ever-increasing protections and provisions. In either case, we deviate from seeing God as the mediator of our values and defer either to the marketplace or Big Daddy government to give us our “sense of identity, purpose, meaning and community.”
Sirico ultimately believes that without the virtues that arise from human submission to God’s internal government, we decay and spiral into greed and avarice, no matter the market, no matter the government. Yet, even when greed is present (and it will always be present) freedom and free markets still provide the most benefit to the poor and are most affirming of human dignity.