Towards a Just Economy edited by Raymond Pelly, published by the Combined Chaplaincies, VUW, 1991. p.11-20. (Revised version of a lecture given April 1991)

Keywords History of Ideas, Methodology & Philosophy

Just over a year ago, on my birthday, I visited Majdanek, near the Polish City of Lublin, 160 kilometres south east of Warsaw and 80 kilometres from the Soviet border. Majdanek was a concentration camp. Its dead from starvation, infection, and execution – included 150,000 Poles, 125,000 jews, 70,000 Russians, plus those of other nationalities, a total of 360,000 souls – the population of today’s Christchurch or greater Wellington. The main memorial at the camp is a giant urn containing 7.5 tonnes of human ashes. The inscription reads “Los Nasz Dla Was Przesthorga” – our fate is a warning to you.

The previous birthday, in 1989, I had been up on the Perry Saddle, and while that night the rain had beaten through the windows of the tramping hut – a hut more substantial than those at Majdanek – one never felt the weather on the Heaphy Track was evil. Nature is extraordinarily powerful and can be extremely destructive, but to the modem mind it is not malevolent. That is something reserved, apparently, for humankind.

I will not detail the obscenity of Majdanek; that must be an experience reserved for each of us when we visit a concentration camp . But I want to share with you the path that I was led down, as I mused about personal responsibility, particularly my own.

It is very easy to observe the terrible things at concentration camps like Majdanek, to condemn those directly involved in the atrocities, and to stop there. It is equally unsatisfactory to generalise vaguely that it shows all mankind is capable of committing atrocities, and we are all guilty. My concern was where actually does the responsibility stop?

Let me begin by saying that I am not concerned to blame the German nation as a whole, particularly those who were born or came to the age of responsibility after 1945. I do not believe that sin is inherited, and in that Germans stand with me and as vehemently condemn such behaviour as an abomination, they are no more guilty than I.

The line of thought began because the town of Lublin was so close that on an infamous day in November 1943, when 18,000 Jews were rounded up, herded into pits and machine gunned, loud music was played so the locals could not hear the execution. But over the years the citizens must have known, broadly, what was going on. How compliant were they? And in that they were compliant were they as guilty as the camp guards? I cannot answer such questions because I do not know the specifics. But I began to wonder who else were involved. It is easy enough to condemn the guards, but what about – say –the administrators back in Berlin? They presumably did not know much about the details with what happened, but did they understand the import of their involvement, did they try to find out?

Of course ones’ response to Majdanek was not solely an intellectual one. I wanted a prayer, or a karakia. Lines of poetry ran around inside me not quite saying it. I was reading Frank McKay’s biography of James K. Baxter, and I came across Baxter’s response to his visit of Hiroshima, an even greater oven.

Having seen an ocean of fire and then
An ocean of ashes, her mother’s head
On the ground in the pumpkin field, Eioka lies
Under a stone in Akagi. Not yet ten
She liked bean jam. You guardians of the dead,
Comfort this child, so young in your mysteries.

(Thank you Hemi, for saying it for me but better – again.)

And so my thoughts turned to an even greater oven of extermination, the bombing of Hiroshima. You will recall it was done by ‘our’ side, on people who were not of ‘our’ ethnicity. Again I do not feel personally responsible for the dropping of the atomic bomb, but I have pondered on where that responsibility stopped. For instance did it include the refuellers of the B29s which dropped the bombs? Did it include those in the airbase cafeteria who fed the refuellers ?

One helpful answer, albeit from a much less significant instance, was told to me by a friend whose brother had been in a partnership with a lawyer who embezzled his clients. When the Law Society investigated the brother, it being necessary to do this because lawyers can be liable for the debts of their professional partners, it was shown that the brother had regularly attempted to check on the partnership’s financial integrity. Being deceived himself the brother was found not liable for debts the embezzlement had incurred {and so the debts were covered by the collective Law Society indemnity fund).

The point is the test was whether the brother had taken reasonable steps to prevent the fraud. The instance also clarified for me that other people in the law office – such as the secretaries – were not culpable either because they were not in a position, nor had the expertise, to detect the peculation. Of course if they had learned by chance occurrence of the malfeasance that would change their obligations.

So there seems to be two groups associated with a particular responsibility issue, who may be readily exempted. Those who because of their position cannot be reasonably expected to be involved in the particular event. And those, who while more involved, actively attempted to prevent the immorality.

What was especially cathartic about Majdanek was that I was struck how the concentration camp initially started as solution to a production problem, of maximizing output for the resources available. I must have known it before, but somehow I had not connected that with the obscenities of the human indignities, the deaths, and the executions in concentration camps which I had also read about. Being there not only turned those horrors into a terrible reality, but connected the economics with the immorality.

We normally see concentration camps back to front in time. The first reports – not believed at the time – were when the camps were liberated. Then we have the records of a little earlier when the atrocities were at their worst. And we are so revolted by them that we cannot see before then, when the camps’ purpose was a means of increasing the economic performance of the warrior state.

Yet to the economist’s eye that economic motive dominated the structure of the concentration camp. That is why they were so quick to execute children under the age of ten – the age of Baxter’s Eioka. Children are not economically productive. In cold economic terms the discounted cost of maintaining them exceeded the maximum level of production that they could provide.

Once the concentration camps began down this path of economics before humans, the guards and the controllers became, step by step, inured to the human indignities that were being imposed. I suspect the same is true for those, who while not directly involved in the running of the camps, knew what was going on but did not protest.

If the atrocities had been executed at the beginning, there would have been a fierce reaction to them. But instead an economic theory was implemented, a theory which ignored human dignity, and steadily and relentlessly it was pursued to its final conclusion; a conclusion so terrible that we have almost forgotten the original theory and the original purpose of the exercise.

It matters little that the economic theory of concentration camps was not a very good theory, even in its own terms. The rightness or wrongness of a theory does not absolve the moral issues. In any case no theory is right. The best we can say is that some theory is less wrong than all the others, and this may well be true, on the balance of probabilities, for the theory we currently hold. But we need to be humble when we propose a theory, for it supersedes the theories of many men and women whose intellectual merit far outweighs ours. And anyway economic theories are amoral. We have to add something more to turn a theory into policy and operational reality. Even if the theory of the concentration camp had been correct in the lights of the day, the camps were still immoral – right from their commencement – because they denied human dignity.

I do not want to argue that concentration camps exist in New Zealand today. They do exist, or have existed in my lifetime, elsewhere – notably in Cambodia. I am not a specialist in such areas, and I do not believe I have any direct responsibility to seek such atrocities out. When I learn of them I am feel a bit like the lawyers’ secretary who learns by accident of the fraud, but has no law partner, no Law Society, no police to turn to. All I can do is to acknowledge heir existence by mentioning them in appropriate contexts – such as this one –and responding practically if I am asked for help.

It would be a crude sensationalism to say that we have obscenities like concentration camps in New Zealand. But for the economists, as probably for any professional person, there are situations where parallel moral issues arise.

Every day public policies are implemented, based upon theories which are to various degrees an account of how the world operates. Economists, and other professionals, may dispute to what extent they are the best theory for the given circumstances being a disputatious bunch we economists do. But by arguing about the theories we too often ignore the moral underpinnings which transform that theory into a policy with practical consequences for human dignity. At this stage it is easy to fail to notice properly these consequences. Theories, by their very nature, do not have an explicit moral dimension, so it is easy for us not to observe the practical consequences which involve this dimension. And so, step by step we become inured to any immorality of the policies, and we drift down the road towards a growing evil by failing to exercise our responsibilities.

I illustrate this with a concrete instance. I have chosen the issue of unemployment, because it is probably the most serious – in human terms – economic issue which faces today’s policy makers. I was tempted to chose poverty as my illustrative theme. It is a problem which I have been talking about for two decades, but the conventional wisdom has ignored the facts. Now we have precipitated the most serious poverty crisis in New Zealand in my lifetime. Perhaps because we did not face the poverty squarely, we drifted into an even worse evil today of severe unemployment, itself compounding the poverty problem.

Economists define unemployment as the phenomena of a worker without work, willing to work, and actively seeking work. Economic analysis does not consider the consequences of this unemployment on the person and the family, except where it feeds directly back into the economy. Thus economists recognise the consequences of the fall in income caused by unemployment on consumer spending and confidence, but we do not trace the psychological consequences.

Simplifying reality, particularly by ignoring phenomena which does not seem important in the context of the issues under investigation, is an inevitable part of any science. There is no need to apologise, for it would be god-like to have a comprehensive and all pervading theory. Omniscience is not a quality one expects in humankind, and certainly not from its economists.

However although economists may have a good justification for ignoring the personal, family, and social consequences of unemplovment in their theories of the economy, that justification does not carry over to the same neglect when the consequential policies are advocated and implemented.

To proved a context let me briefly summarise what we know about the consequences of unemployment. Most of the systematic research comes from overseas, and much is scientifically problematic. But such is the overwhelming weight of the evidence we can say, with as much confidence as a scientist may say anything about this world, that unemployment causes a deterioration in the welfare of the unemployed, and of their families, above the deterioration caused by the loss of income. Perhaps the best established result is that the unemployed are more likely to commit suicide, but numerous other indicators of physical, psychological and spiritual wellbeing also indicate that the unemployed are worse off.

Moreover there is evidence that the personal circumstances impinge on the rest of the family. Studies find that not only do long term unemployed men experience a higher level of illness, but so do their wives. Reading this research can be demoralising and depressing, though not as much as it is being unemployed, but it can also be touching and uplifting. As miserable is as the finding that unemployment impacts on the whole family, it shows the social health of one member transmitting to those they are close to. It is good for an economist to see that family is more than a means of consumer spending and worker reproduction.

There is less research on the social impacts of unemployment. For instance it appears that unemployment and crime may be related, but in a complicated way. Certainly we are not in a position to say that the unemployed invariably turn to crime.

What is absolutely clear to any economist reading through the massive research findings – variable in quality though they may be – is that unemployment causes a diminution in personal, family, and social welfare, which is not captured in the conventional economic measures such as gross domestic product.

How should an economist respond to this research? First, I think we are obliged to have a working knowledge of its broad implications. It is no good calculating the productivity of the concentration camp, and ignoring the human misery which goes with it, just because it is outside one’s expertise. For Christ’s sake, even economists are humans.

Second, economists are duty bound to explain the role of unemployment in , modem dynamic economy. At its heart is the process of redeployment, in which workers move from low productivity and obsolete jobs to high productivity jobs in new and expanding activities. In many cases the worke will do this at the same workplace, with little disruption. But sometimes th redeployment will involve moving to new worksites, new firms, new industries, and even new regions. On some such occasions the redeployment transition will involve a period of unemployment.

We may moderate the redeployment process, but as best we understand it, any moderation appears to slow down the process of dynamic change. This will not only slow down the growth of material prosperity, but the economy will lose its market share in the world, stagnate, and ultimately the nation will lose its economic viability.

You will notice that I am not arguing here for the need for a required level of unemployment to control inflation or offset the pressures on the balance of payments. Economists may dispute the need, and the magnitude, but these are using workers for other objectives, which can be pursued by other means. However in the case of redeployment I cannot see any realistic alternative.

That leads to the third step for the economist. Reluctantly – and it has to be reluctantly given a reading of the literature on the social consequences of unemployment – we have to confront the community with the choice between material prosperity with redeployment and some unemployment on the one hand, and economic stagnation on the other. Unfortunately we cannot be precise about the magnitude of that tradeoff, but it is there.

My guess is that when confronted with such a choice, the New Zealand community is likely to say that it wants the level of unemployment to be taken into account when setting economic policies, and would be prepared to make some sacrifices in other economic objectives to attain full employment.

By doing so the community would be implicitly critical of the policies of the last five years, because full employment has had a very low priority in the implemented policies. Advancing of full employment in the goal hierarchy would result in different policies. Full employment would not be an add on to economic policies, but would be an integral part of them.

Adopting this community set goal would provide a very real challenge for economists. Many of us have personal goals which do not conform to the community’s. There is nothing wrong with that; in a democracy the individual is entitled to their own views and objectives. What is unacceptable is the promotion of one’s personal objectives in the guise of djspassionate policy advice. There is no such thing as value free policies; what the public has a right to is value explicit policy advice. A good economist ought to be able to give advice in terms of objectives other than his or her own personal ones.

So the fourth step, for economists and others, is to discuss the meaning of full employment.

Even when registered unemployment was minuscule in the 1950s and 1960s, we know there were unemployed people. The point was they did not report to the Department of Labour. That was because being unemployed was not threatening to most of the unemployed. A situation where unemployment is non-threatening despite there being unemployment as a part of the process of redeployment, is probably the relevant notion for full employment. What that means operationally has to be worked through. While doing so economists would very soon realise that the conventional measures of unemployment are virtually irrelevant.

The percentage of the labour force unemployed is just that. It does not tell as the numbers who are experiencing, or are expecting, long periods of unemployment. It does not tell us whether particular groups of the community – by ethnicity, age, gender, region, or class are unemployed. It does not include those who are so discouraged by their job-seeking experiences, that they no longer actively seek work, even though they would seize a job if it were offered to them. And it does not include those who cling to the margins of the labour force, working a few hours a week, even though they desperately want a proper job, with proper working conditions and sufficient hours of work.

This definition exercise confronts the economics profession with the nasty realisation that the way economic theory models unemployment is almost totally irrelevant m terms of the social consequences. We just hope that reducing the percentage unemployed somehow impacts – sort of proportionally – in consequence terms.

And so we reach the final technical step as a professional economist, which is in two parts. One is to model better in economic theory terms the phenomenon of unemployment. The other is to identify those unemployed who are most impacted by the experience, and seek policies which moderate that impact

This is not the sort of agenda which would go down well in the economics profession because it challenges its conventional wisdom. (It is not the sort of agenda that would be too popular in government circles either. Not only does it challenge its economic policies but also it requires a genuine commitment to a social science research program.)

There would be considerable resistance. The line among some economists and politicians has been TINA: there is no alternative to present theories. Karl Popper says that if you see no alternative to your theory then “take this as a sign you have neither understood your theory nor the problems which it is intended to solve”. It is not merely a lack of imagination and understanding. TINA involves a shortsightedness of vision, for elsewhere in the world one sees all sorts of other policies being tried, in many cases much more successfully than the outturn in New Zealand.

But these technical arguments are almost irrelevant. It is like engineers discussing whether Majdanek was efficiently and economically designed. The human element is being omitted.

You see the technical arguments do not end the issue. A few paragraphs ago I talked about the final technical step of a professional economist. But does his or her responsibility stop there? Is there not a responsibility to speak out?

I am haunted by a statement of the Reverend Martin Neimoeller. Talking about the 1930s he said:

In Germany, they came for the communists, and I did not speak up because I wasn’t a communist. Then they came for the trade unions, and I did not speak up because I wasn’t a trade unionist. Then they came for the Catholics, and I did not speak up because I was a Protestant. Then they came for me – and by that time no one was left to speak up.

It is so easy to be silent when the government goes for. the workers, and deliberately creates more unemployment, or goes for the poor and deliberately creates more poverty, or goes for the trade unionists. But is it responsible?

As another reverend, John Donne, said in the seventeenth century:

No man is an Island, entire of itself; every man is a piece of the continent, a part of the main. …Any man’ s death diminishes me, because I am a part of Mankind; and therefore do not ask for whom the bell tolls, it tolls for thee.

Or take a different continent, a different agenda. You probably know the tune, Guantanamera. You may even know the Spanish version of the poem of nineteenth century Cuban, Jose Marti, one of the greatest writers in the Spanish language. He wrote them just before dying in an attempt to free his country from tyranny and imperialism. The last verse in English goes

With the poor of the earth/ I want to share m)
The streams of the mountains/ please me more than the sea.
(Guantanamera, guahira, guantanamera.)
Economists cannot claim we are the secretaries in the law firms of the economy. We are partners and have a responsibility to test our colleagues’ account of the world and their policy recommendations. Silence is unacceptable.

While we cannot expect everyone to be on the frontline: there are many ways to share the fate of mankind. Everyone in a profession has a personal obligation to seek a path which does this.

The professional costs may not be insignificant. As John Maynard Keynes commented “worldly wisdom teaches us that it is better for the reputation to fail conventionally than to succeed unconventionally”. But moral responsibility requires a willingness to commit oneself to truth, and to criticise in appropriate circumstances, despite the personal costs.

Of course the criticism needs to be constructive, acknowledging the good features in the proposal, and offering considered alternatives. As Popper indicates the critic needs to have a thorough understanding of the strengths and weaknesses of the theory being challenged.

And so despite, or because of, Keynes’ remarks there is a need for each profession to review and develop its members’ moral awareness. Take for instance the two disciplines that I have been referring to – economics and public policy. In their professional training where are the ethical issues discussed? Where are they reviewed after graduation? I wonder how many professions could be satisfied with their responses to those questions. The outsider has a role to press for such institutions, and support those who criticise – even though they may not support the details of the criticism.

Not facing ethical issues leaves us open to the possibility of the concentration camp, as we become insensitive to moral issues. I came away Majdanek with a greater resolve to take my partnership responsibilities even more seriously. However I must confess there was also the prayer that I should never have to face the moral pressures which they faced who knew about Majdanek: and if, oh Lord, I face such pressures I hope that I will bear them with courage, with truth, and with dignity.

Yet that is not my final image of Majdanek, for none of the horrors moved me as much as the statue near the gas chambers of a woman uplifting her child high in the air. The same statue is also a part of the monument at the Warsaw Ghetto remembering the genocide of the Jews in that city.

The statue commemorates the mothers holding their children high as the gas rose in the chambers, so the young could have a few extra minutes of life. Even near their death those women showed us that marvellous courage we call the human spirit, thinking of the well-being of others even though they were themselves doomed. Their fate is an inspiration to us.

A New Zealand Economist Looks at the  the US Catholic Bishops’ Pastoral Letter on Catholic Social Teaching and the US Economy

Paper to the Winter Series ;The Soul of New Zealand – Who are We?’, Wadestown Presbyterian Church, July 19, 1989. It was published in “The Catholic Review” Number 1, November 1989.

Keywords: History of Ideas, Methodology & Philosophy;

Given the role of economists in the turmoil of the last few years, this economist is surprised that any of us should be asked to comment upon such an important topic as the Soul of New Zealand. We should be listening to the people; not the telling them.

However perhaps such a task requires some structuring, in which case I might usefully provide a little by responding to some theological commentary on economic policy, before we open the session to general discussion, with an emphasis on the economist listening.

I could have chosen as a theological commentary the Reverend Richard Randerson’s Christian Ethics and the New Zealand Economy, particularly for its indigenous content. But if you had wanted to discuss that interesting contribution then it would be better to hear from Richard directly. I urge you to invite him on some suitable occasion.

What I thought would be better was to look at an overseas text. The one I have chosen is The Pastoral Letter on Catholic Social Teaching and the US Economy, published by the United States Catholic bishops in 1986.

It may seem odd to select a Catholic sourced economic text for discussion in such a protestant environment as this church. One reason is in the spirit of ecumenism. But there were also four practical reasons.

First, unlike most protestant church’s Catholicism predates the industrial revolution, and Catholic theologians more than most others have had to struggle with the relationship between their religion and the modern capitalist economy. I shall have more to say about this.

Second, the United States economy is the greatest industrial economy in the world, where most of the fundamental economic issues which confront us in New Zealand are writ even larger. Because the bishops have had to ponder long upon these issues, we may learn something from them.

Third, because they have pondered long — and in my opinion wisely — their conclusions are likely to have considerable influence upon theological thinking in all parts of the religious world. This is already happening in America. I was recently invited by Crosslink to review a book of essays written by evangelical protestants, mainline protestants, Catholics and Jews on the pastoral letter. It shows a vigorous debate is already underway in the United States; I shall refer to some of it. If the pastoral letter is not so well known in New Zealand, I am sure it will become so. I hope this presentation will stimulate your interest.

And fourth, the bishops say that they have not written

‘a blueprint for the economy. It does not embrace any particular theory of how the economy works, nor does it attempt to resolve the disputes between different schools of economic thought.’ (p.ix)

That is a sensible theological approach. Theologians have no particular expertise in tackling the technical questions of, for instance, optimal industrial assistance, or what should be the monetary and fiscal stance. That is the economist’s job, and while I would not wish to restrict the task to some secret or select clique, those who wish to join these debates need to acquire a level of technical competence which theologians seldom have. Their competence is, as the bishops go on to say

‘Instead, our letter turns to Scripture and the social teachings of the Church. There, we discover what our economic life must serve, what standards it must meet.’ (p.ix)

`What economic life must serve, what standards it must meet’. There is a challenge on which economists have no particular competence; an issue where we need to listen rather than to pontificate.

So what are the standards the bishops set? The full letter is over two hundred pages long, with 384 numbered paragraphs. Conveniently there is a summary of principal themes. I begin by listing the italicised sentences in that summary.

(i) ‘Every economic decision and institution must be judged in the light of whether it protects or undermines the dignity of the person.’

(ii) ‘Human dignity can be realised and protected only in a community.’

(iii) ‘All people have a right to participate in the economic life of society.’

(iv) ‘All members of society have a special obligation to the poor and vulnerable.’

(v) ‘Human rights are the minimum conditions for life in community.’  (They go on ‘In Catholic teaching, human rights include not only civil and political rights but also economic rights … all people have a right to life, food, clothing, shelter, rest, medical care, education, and employment.’)

(vi) ‘Society as a whole, acting through public and private institutions, has a moral responsibility to enhance human dignity and protect human rights.’

At a personal level I find much comfort that a group of people from a very different intellectual and social background on the other side of the world should articulate a philosophy very similar to my own. But I would be failing in my responsibilities if I did not put them under some scrutiny from the perspective of a New Zealand economist.

The first problem is that the bishops provide no adequate definition of what they mean by `human dignity’. They do refer to a papal encyclical Mater et Magistra which articulates the principle that economic life must be measured against the dignity of the human person realised in community with others. They refer to the ‘transcendent worth – the sacredness – of human beings’ (p.15).  And they go through the scriptures to describe the moral vision of the Christian.

I take it that we are to treat ‘human dignity’ as some fundamental concept, undefinable in terms of more fundamental concepts, but which can be illustrated by example. In that technical sense it has the same status as the New Right’s objective of freedom, although I imagine that Christians would want to argue that human dignity is a much richer concept.

This follows because the notion of human dignity as described in the letter emphasises man in society, that is socialised man. I am using here the term ‘man’ to encompass both genders. These terms came from the nineteenth century, when social philosophers were less careful about giving equal status and involvement to women. I apologise to those of you who are concerned with such gender issues – and I hope that is the whole audience – but we have no adequate alternative term to ‘socialised man’.

Socialised man emphasises that each of us is not a being which arose independently of the society in which we live, who can function independently of that society. We are not Athenas who sprung fully clothed and fully armed out of the head of Zeus. Rather we have evolved and live in a society which has nurtured us.

Most people may feel this is a trivial point, but I think the bishops are right to emphasise it. The rational economic man of neo-classical economics is not an example of socialised man, and the characterisation of the human condition by the New Right is even less so. The bishops would judge such characterisations as spiritually dead, and rightly so. Social philosophies and policies based upon such foundations would be judged to be against what they describe as the Christian vision of economic life.

I do not want tonight to judge current economic policies by the Christian vision. That is for the audience. But they may be relieved to know that in our past human dignity was a central notion of our social policy. In particular the social security debate of the late nineteenth century used the concept widely, particularly in the notion that the aged should be treated with dignity in their pension entitlement. Not, of course, did we always attain that objective, but the notion of the entitlement to a social security benefit and other publicly provided services being by right, rather than by the liberality of the powerful, has been an integral part of our social policy.

Perhaps that is less true today, although the recent Royal Commission on Social Policy while not using the term ‘human dignity’, it did refer to the ‘intrinsic moral worth’ of individual humans.

The Royal Commission on Social Security which reported in 1972 referred to the human dignity approach, as you would expect in its review of our social security debate. But the Commission used a more instrumental definition of social objectives, when they described the objectives of the social security system, and by implication of public policy in the wider society, as

‘to ensure, within limitations which may be imposed by physical or other disabilities, that everyone is able to enjoy a standard of living much like that of the rest of the community, and thus able to feel a sense of participation and belonging to the community.’ (p.65)

Perhaps I should add a verbal quote does not quite capture the fact that the Commission italicised the phrase ‘a sense of participation and belonging’.

The bishops expressed a similar sentiment when they said that ‘All people have a right to participate in the economic life of society’,  and that ‘all members of society have a special obligation to the poor and vulnerable.’ You might say that the US bishops are real New Zealanders, or that each are expressing some universal phenomena.

It is clear from the letter, that the bishops are very influenced by an American philosopher John Rawls, who published his seminal Theory of Justice at about the same time as our Royal Commission on Social Security reported.

It may seem surprising that bishops representing a religion as old as the Catholic Church should be so influenced by a recent philosopher. However Rawls is indebted to the eighteenth century German philosopher Immanuel Kant, whose supreme moral principle was a categorical imperative, which harkens back to Christ’s injunction to ‘do unto others as you would have them do unto you.’ We may take  the bishop’s philosophical foundations as rock solid.

Essentially, and I simplify, Rawls argued that social policy should be judged by the way it treats the least well off in society. His derivation was as follows. Suppose each of us were able to choose which ever society and economy we preferred. The only limitation is that we would not know what our status would be in it; whether we would be rich or poor, white or brown, male or female, intelligent or dull, heterosexual or homosexual, and so on.

In such circumstances we would be unlikely to select a particular form of society which favoured one set of characteristics over another, since we may well end up in that society with the less favoured characteristics. Rather, given this veil of ignorance about our status, we would prefer a society which maximised the minimum level of wellbeing. So if we were unfortunate enough to end up with the least favourable set of characteristics we would as well as possible.

That would result in a society which, in the words of the bishops, “all members of society have a special obligation to the poor and vulnerable”.

It does not follow from the Rawlsian approach that we should have exact income equality, even were that a meaningful notion given that people with different personal characteristics are likely to have different income needs.

A Rawlsian would argue that inequality was acceptable providing the poor benefitted from it. For instance, a state bureaucracy determined to iron out all inequality could well be so expensive to run, and generate so many disincentives against producing, that the poor had their standard of living lowered in comparison to a society with a moderate level of inequality. On a more positive note, the possibility of a degree of inequality may encourage people to take initiatives which generate jobs, opportunities, and commodities for those on a lower standard of living.

The bishops therefore do not abjure economic inequality, but they do say

‘We find the disparities of income and wealth in the United States to be unacceptable. Justice requires that all members of our society work for economic, political, and social reforms that will decrease these inequalities.’ (p.92)

As it happens, the evidence points to New Zealand having lower economic disparities than the United States, so we cannot be sure what the bishops would say about New Zealand. However I suspect they would be concerned about our poorest, particularly those who fall through the social security net perhaps because they have inadequate housing or health. Nor would the bishops likely to be happy with the differences in the economic statuses between men and women. And quite frankly, I would be much too embarrassed to even show them the evidence of the substantial disparities between Pakeha and Māori.

It is very easy at this stage to come back with the standard New Right response that the poor are poor through their own faults. It would be foolish to argue there are no poor who have defects which have led them into poverty — one would have virtually abandon the notion of free will to rule out such possibilities.

But even acknowledging the possibility of there being some who are poor through their own faults, the evidence points to the majority of the poor, here and overseas, trapped in that state for ‘structural’ reasons. It is the way society is organised that keeps them there, not their own shortcomings.

In arguing this, it is unnecessary to equate poverty with material deprivation. The Royal Commission on Social Security’s notion of ‘inability to be able to participate and belong to society’ is the encompassing notion.

The bishop’s go a step further when they argue that

‘Social justice implies that persons have an obligation to be active and productive participants in the life of society and that society has a duty to enable them to participate in this way.’ (p.36)

Providing, as I am sure is the bishop’s intention, that the notion of positive participation in the life of society is interpreted widely, I do not have many difficulties with their notion of ‘contributive justice’. What is unclear is what happens to those who do not fulfil the obligation. What are society’s duties towards them?

This question may be a bit theoretical when the main issue we, and the United States, face is that there so many people willing to fulfil their obligation to contribute to society, but unable to do so because society is failing in its duty by not offering them the opportunity. That group includes the structurally poor, and the unemployed.

The bishops are very strong on the need for full employment.

‘Full employment is the foundation of the just society.’ (p.69)

Thus they echo the New Zealand perception that full employment is the foundation of the welfare state. Given a current level of unemployment in New Zealand of between 7 percent and 12 percent, depending upon how it was measured, the bishops were particularly pertinent when they said

‘We believe that 6 to 7 percent unemployment is neither inevitable nor acceptable.’ (p.77)

‘Neither inevitable nor acceptable’. That sounds like a severe critique of current economic policies does it not? Moreover the bishop’s account, while caring, is not uninformed in economic terms. It goes on

‘While a zero unemployment rate is clearly impossible in an economy where people are constantly entering the job market and others are changing jobs, appropriate policies and concerted private and public action can improve the situation considerably, if we have the will to do so. No economy can be considered truly healthy when so many … people are denied jobs by forces outside their control. The acceptance of present unemployment rates would have been unthinkable twenty years ago. It should be regard as intolerable today.’ (p.77)

Are the economic pundits and politicians listening? That is for the audience to decide.

Such were the sentiments of the bishops’ letters that some critics described it as ‘socialist’. That terminology seems curious to New Zealanders particularly as the bishops write

‘The Catholic tradition has long defended the right to private ownership of productive property.’ (p.57)

However in contrast to the approach of New Right to private property they go on

‘Support of private ownership does not mean that anyone has the right to unlimited accumulation of wealth. Private property does not constitute for anyone an absolute and unconditional right. no one is justified in keeping for his exclusive use of what he does not need, when others lack necessities.’ (p.58)

This is the biblical notion of stewardship of property. One has it only in so far as the property is used for the pursuit of the common good. A little earlier the bishops had said

‘The common good may sometimes demand that the right to own be limited by public involvement in the planning or ownership of certain sectors of the economy.’ (p.58)

‘Planning’, ‘public ownership’. This is not the language of Rogernomics, nor the policies of the fourth Labour government. Those who thought their social democratic principles were fossils from an earlier era, may be surprised to learn that the US bishops are with them.

Actually we have been given a very peculiar account of modern political and economic thinking, because of the accident that the policies of the New Right have been most propounded by English speaking Reaganomics and Thatchernomics. There has been little realisation here as to just how isolated Mrs Thatcher is in European thinking.

For instance in the just elected European Parliament, there are more Greens than their are Tories, who are isolated from the main political grouping which opposes the socialist (slight) majority. The centre of that grouping are the Christian Democrats and their allies from a number of European countries. The expectation is that they, with the democratic socialists, will promote legislation to improve conditions for workers, to extend the social wage, and to provide regional and industry assistance.

Such a political thrust from the Christian Democrats is only surprising if one is surprised that Pope John Paul said

‘One cannot exclude the socialisation, in suitable conditions, of certain means of production.’

As the bishops say

‘The Church’s teaching opposes collectivist and statist economic approaches. But it also rejects the notion that a free market automatically produces justice.’ (p.58)

We can guess what the bishops’ view on proposals to ‘deregulate the labour market’ are

‘The Church fully supports the right of workers to form unions … to secure their rights to fair wages and working conditions. … Unions may also legitimately resort to strikes where this is the only available means to justice owed to workers. …. No one may deny the right to organise without attacking human dignity itself.’ (p.53)

By New Zealand standards the bishop’s section on `Working People and Labour Unions’ is radical; enough to make a Patrick Kelly leave the Labour Party for the Catholic Church.

By now it should be evident that the bishops’ pastoral letter on the US economy is rich and relevant. It is time to turn to some of the criticisms.

First there are the technical issues. I have little time for those who support Rogernomics with the claim that their economic reform was necessary because there was no other way. Economists who saw the need for major economic reform argued for quite different strategies than the one adopted here, strategies adopted overseas.

If someone insists there was no alternative ask what was so inevitable to require cutting the marginal income tax rate on the rich from 66 percent to 33 percent, making it one of the lowest — if not the lowest — in the western world?

Where I have greater problems is the time dimension. One argument for Rogernomics has been that goals such as the bishops propound are the ultimate objective of economic policy. However the government has had to do some savage things to the poor and unemployed in the short run to attain the objective.

I must say in fairness that the government has chosen not to attack verbally the poor in the traditional right wing rhetoric of their being benefit bludgers and scroungers. The necessary review and tightening of the administration of social security to reduce fraud has been done with some tact. In this respect the Labour Government deserves recognition for the promotion of human dignity.

But how are we to approach their argument that in the long run the poor will benefit from the policies which are being implemented, even if they suffer in the short run? Sounds a bit Calvinist does it not?

A good parallel is the findings of the Cartwright Commission on the activities at National Women’s Hospital. I take it that the doctors involved were sincere and believed they were acting in the best interests of their patients. I do not have the competence to judge whether the doctors were acting so, nor is it necessary to come to some assessment of this here. What I am clear about is that the patients were not adequately consulted.

The same issue applies to recent economic policy developments. The government may be taken as sincere and believe it is acting in the best interests of the poor and those on the margins of society, we need not judge here whether its treatment is the best available. However we can ask to what extent the underprivileged were consulted on the treatment that they have been given, to what extent they had it explained it to them, and to what extent they gave informed consent.

As the bishops say

‘The obligation to provide justice for all means that the poor have single most urgent claim on the conscience of the nation.’ (p.44)

In which case there is an obligation to consult them to find out what their claim is.

Let me free-wheel for a paragraph. In principle, our democracy has a system of one person one vote, although there is bias in it towards the rich who have the economic means to accrue unequal political power to themselves. But even ignoring this bias, is the logic of the bishops’ position that the poor should have a greater weight in the voting system compared to the rest us? Or is this a democratic heresy?

So much for the technical problems involved in the bishops’ approach. Let me turn to the deeper ones of social philosophy. Recall my earlier remark that the Catholic Church is older than the modern industrial capitalist economy, in the way that most protestant churches are not. It is no accident that tonight I am reviewing a text described as a ‘pastoral’ letter.

In some ways the fundamental break is between the organisation of society around the social solidarity of preindustrial society, and the individualism of industrial society. As one writer said ‘the traditional Catholic communitarian vision [is] of a human family ordered in organically related social structures.’ (Strain, p.190)

That is why the bishops are able to talk about the ‘common good’ with so little introspection, and it is clear that they do not merely mean the sum of individual preferences, which economists often interpret as the common good.

The procedure John Rawls proposes attempts to get around this conflict between the common good and individualism, but it does so at some cost.

I illustrate by drawing attention to the fact that my gender is obviously male. This is one of a number of personal characteristics which are a very integral part of me as a human individual.

As a result I find it most difficult to carry out the Rawlsian thought experiment from the position of a genderless human individual. It would not be me who is making that decision about my preferred choice of society.

(Of course I try to be empathetic to those of another gender. and that I have a mother, sister, wife, daughter, and women friends and colleagues helps me, I hope, to do this reasonably sensitively. But that is not the same as what the Rawlsian experiment requires.)

This is not an entirely theoretical issue. Suppose we said to everyone ‘what is the minimum income you would need to participate in and belong to society’, perhaps with the idea using the answers for designing distributional policy. For instance, if they were all to choose the same minimum income, and if this were practically deliverable, then it would be a candidate for the poverty line below which no one should fall.

However, everyone does not choose the same minimum income level for living comfortably, and as a general rule the higher one’s income the higher one’s required minimum standard of living. This may not be surprising, but its social implications are. First, it says that the Rawlsian veil of ignorance is not going to be much help in trying to quantify an acceptable distribution policy.

Second, it says if the rich knew how really poor were the poor, and they accepted the bishops’ social philosophy they would be appalled. Fortunately ignorance protects them from such a fate.

There is another strange thing about the Rawlsian thought experiment. I am expected to act selfishly behind my veil of ignorance. But perhaps I am not totally selfish. That reinforces the conclusion to the existence of some common good above the sum of our selfish decries.

I guess what I am bridling at is the Treasury-type line which starts by noting that people make selfish decisions on occasions, and then goes on to argue that we should design public policy on the assumption that people always make selfish decisions.

A further problem with the Rawlsian approach is that it is not sufficiently comprehensive to lead to a complete economic policy, even if we can agree on how economies work, we could not generate a complete economic policy from mere Rawlsian principles.

This is getting a bit abstract, so I offer the easy illustration. Where would the Treaty of Waitangi fit into the bishops’ account, if they had been writing about the New Zealand economy rather than the US one? I do not think the Treaty, and treaty issues, are just an add on, but I do not see how easily to extend the pastoral letter to cover it. In other words there may well be important social issues not covered by the pastoral letter.

The majority of my criticisms are in the spirit of the pastoral letter; ones the bishops are likely to respond positively to. But I have tried to touch upon the criticisms of the New Right, particularly their concerns about the tensions between individualism and social solidarity. Those tensions loom large in any protestant assessment of the issues too.

The bishops were not unaware of them; after all the letter was written during the height of Reaganomics, and in many ways is designed as a response to that political philosophy, albeit a positive response rather than a carping one.

I think that is the way we have to approach Rogernomics and the economic policies of the fourth Labour Government. That applies as much to its supporters as to its critics. We lack a sound, comprehensive and cogent philosophical account of what Rogernomics stands for, and as yet the criticisms are fragmentary rather than as profound as, say, the pastoral letter.

Ultimately those accounts are about articulating the soul of New Zealand. What then is the role of the religious person in articulating this soul of a secular society? The spirit of the bishops’ pastoral letter provides a guide when they say

‘Sustaining a common culture and a common commitment to moral values is not easy in our world … One of our chief hopes in writing this letter is to encourage and contribute to the development of the common ground.’ (p. 11)

New Zealanders today feel the loss of the articulation of the nation’s soul more than at any time in my life. By debating such overseas contributions as the pastoral letter, and by doing so evolving their own indigenous account —  including incorporating other sources such as the Māori perspectives — the religious can make a distinctive contribution to that common good. I would have thought such a purpose would be high among their priorities. Let us begin.

A New Zealand Economist Looks at the  the US Catholic Bishops’ Pastoral Letter on Catholic Social Teaching and the US Economy

Paper to the Winter Series “The Soul of New Zealand – Who are We?”, Wadestown Presbyterian Church, July 19, 1989. It was published in “The Catholic Review” Number 1, November 1989.

Keywords: History of Ideas, Methodology & Philosophy;

Given the role of economists in the turmoil of the last few years, this economist is surprised that any of us should be asked to comment upon such an important topic as the Soul of New Zealand. We should be listening to the people; not the telling them.

However perhaps such a task requires some structuring, in which case I might usefully provide a little by responding to some theological commentary on economic policy, before we open the session to general discussion, with an emphasis on the economist listening.

I could have chosen as a theological commentary the Reverend Richard Randerson’s “Christian Ethics and the New Zealand Economy”, particularly for its indigenous content. But if you had wanted to discuss that interesting contribution then it would be better to hear from Richard directly. I urge you to invite him on some suitable occasion.

What I thought would be better was to look at an overseas text. The one I have chosen is “The Pastoral Letter on Catholic Social Teaching and the US Economy”, published by the United States catholic bishops in 1986.

It may seem odd to select a Catholic sourced economic text for discussion in such a protestant environment as this church. One reason is in the spirit of ecumenism. But there were also four practical reasons.

First, unlike most protestant church’s Catholicism predates the industrial revolution, and Catholic theologians more than most others have had to struggle with the relationship between their religion and the modern capitalist economy. I shall have more to say about this.

Second, the United States economy is the greatest industrial economy in the world, where most of the fundamental economic issues which confront us in New Zealand are writ even larger. Because the bishops have had to ponder long upon these issues, we may learn something from them.

Third, because they have pondered long – and in my opinion wisely -their conclusions are likely to have considerable influence upon theological thinking in all parts of the religious world. This is already happening in America. I was recently invited by Crosslink to review a book of essays written by evangelical protestants, mainline protestants, Catholics and Jews on the pastoral letter. It shows a vigorous debate is already underway in the United States; I shall refer to some of it. If the pastoral letter is not so well known in New Zealand, I am sure it will become so. I hope this presentation will stimulate your interest.

And fourth, the bishops say that they have not written

“a blueprint for the economy. It does not embrace any particular theory of how the economy works, nor does it attempt to resolve the disputes between different schools of economic thought.” (p.ix)

That is a sensible theological approach. Theologians have no particular expertise in tackling the technical questions of, for instance, optimal industrial assistance, or what should be the monetary and fiscal stance. That is the economist’s job, and while I would not wish to restrict the task to some secret or select clique, those who wish to join these debates need to acquire a level of technical competence which theologians seldom have. Their competence is, as the bishops go on to say

“Instead, our letter turns to Scripture and the social teachings of the Church. There, we discover what our economic life must serve, what standards it must meet.” (p.ix)

`What economic life must serve, what standards it must meet’. There is a challenge on which economists have no particular competence; an issue where we need to listen rather than to pontificate.

So what are the standards the bishops set? The full letter is over two hundred pages long, with 384 numbered paragraphs. Conveniently there is a summary of principal themes. I begin by listing the italicised sentences in that summary.

(i) “Every economic decision and institution must be judged in the light of whether it protects or undermines the dignity of the person.”

(ii) “Human dignity can be realised and protected only in a community.”

(iii) “All people have a right to participate in the economic life of society.”

(iv) “All members of society have a special obligation to the poor and vulnerable.”

(v) “Human rights are the minimum conditions for life in community.”  (They go on “In Catholic teaching, human rights include not only civil and political rights but also economic rights …. all people have a right to life, food, clothing, shelter, rest, medical care, education, and employment’.”)

(vi) “Society as a whole, acting through public and private institutions, has a moral responsibility to enhance human dignity and protect human rights.”

At a personal level I find much comfort that a group of people from a very different intellectual and social background on the other side of the world should articulate a philosophy very similar to my own. But I would be failing in my responsibilities if I did not put them under some scrutiny from the perspective of a New Zealand economist.

The first problem is that the bishops provide no adequate definition of what they mean by `human dignity’. They do refer to a papal encyclical “Mater et Magistra” which articulates the principle that economic life must be measured against the dignity of the human person realised in community with others. They refer to the `transcendent worth – the sacredness – of human beings’ (p.15).  And they go through the scriptures to describe the moral vision of the Christian.

I take it that we are to treat `human dignity’ as some fundamental concept, undefinable in terms of more fundamental concepts, but which can be illustrated by example. In that technical sense it has the same status as the New Right’s objective of freedom, although I imagine that Christians would want to argue that human dignity is a much richer concept.

This follows because the notion of human dignity as described in the letter emphasises man in society, that is socialised man. I am using here the term `man’ to encompass both genders. These terms came from the nineteenth century, when social philosophers were lees careful about giving equal status and involvement to women. I apologise to those of you who are concerned with such gender issues – and I hope that is the whole audience – but we have no adequate alternative term to `socialised man’.

Socialised man emphasises that each of us is not a being which arose independently of the society in which we live, who can function independently of that society. We are not Athenas who sprung fully clothed and fully armed out of the head of Zeus. Rather we have evolved and live in a society which has nurtured us.

Most people may feel this is a trivial point, but I think the bishops are right to emphasise it. The rational economic man of neo-classical economics is not an example of socialised man, and the characterisation of the human condition by the New Right is even less so. The bishops would judge such characterisations as spiritually dead, and rightly so. Social philosophies and policies based upon such foundations would be judged to be against what they describe as the Christian vision of economic life.

I do not want tonight to judge current economic policies by the Christian vision. That is for the audience. But they may be relieved to know that in our past human dignity was a central notion of our social policy. In particular the social security debate of the late nineteenth century used the concept widely, particularly in the notion that the aged should be treated with dignity in their pension entitlement. Not, of course, did we always attain that objective, but the notion of the entitlement to a social security benefit and other publicly provided services being by right, rather than by the liberality of the powerful, has been an integral part of our social policy.

Perhaps that is less true today, although the recent Royal Commission on Social Policy while not using the term `human dignity’, did refer to the `intrinsic moral worth’ of individual humans.

The Royal Commission on Social Security which reported in 1972 referred to the human dignity approach, as you would expect in its review of our social security debate. But the Commission used a more instrumental definition of social objectives, when they described the objectives of the social security system, and by implication of public policy in the wider society, as

“to ensure, within limitations which may be imposed by physical or other disabilities, that everyone is able to enjoy a standard of living much like that of the rest of the community, and thus able to feel a sense of participation and belonging to the community”. (p.65)

Perhaps I should add a verbal quote does not quite capture the fact that the Commission italicised the phrase `a sense of participation and belonging’.

The bishops expressed a similar sentiment when they said that “All people have a right to participate in the economic life of society”,  and that “all members of society have a special obligation to the poor and vulnerable”. You might say that the US bishops are real New Zealanders, or that each are expressing some universal phenomena.

It is clear from the letter, that the bishops are very influenced by an American philosopher John Rawls, who published his seminal “Theory of Justice” at about the same time as our Royal Commission on Social Security reported.

It may seem surprising that bishops representing a religion as old as the Catholic Church should be so influenced by a recent philosopher. However Rawls is indebted to the eighteenth century German philosopher Immanuel Kant, whose supreme moral principle was a categorical imperative, which harkens back to Christ’s injunction to “do unto others as you would have them do unto you”. We may take it that the bishop’s philosophical foundations are rock solid.

Essentially, and I simplify, Rawls argued that social policy should be judged by the way it treats the least well off in society. His derivation was as follows. Suppose each of us were able to choose which ever society and economy we preferred. The only limitation is that we would not know what our status would be in it; whether we would be rich or poor, white or brown, male or female, intelligent or dull, heterosexual or homosexual, and so on.

In such circumstances we would be unlikely to select a particular form of society which favoured one set of characteristics over another, since we may well end up in that society with the less favoured characteristics. Rather, given this veil of ignorance about our status, we would prefer a society which maximised the minimum level of wellbeing. So if we were unfortunate enough to end up with the least favourable set of characteristics we would as well as possible.

That would result in a society which, in the words of the bishops, “all members of society have a special obligation to the poor and vulnerable”.

It does not follow from the Rawlsian approach that we should have exact income equality, even were that a meaningful notion given that people with different personal characteristics are likely to have different income needs.

A Rawlsian would argue that inequality was acceptable providing the poor benefitted from it. For instance, a state bureaucracy determined to iron out all inequality could well be so expensive to run, and generate so many disincentives against producing that the poor had their standard of living lowered, in comparison to a society with a moderate level of inequality. On a more positive note, the possibility of a degree of inequality may encourage people to take initiatives which generate jobs, opportunities, and commodities for those on a lower standard of living.

The bishops therefore do not abjure economic inequality, but they do say

“We find the disparities of income and wealth in the United States to be unacceptable. Justice requires that all members of our society work for economic, political, and social reforms that will decrease these inequalities.”(p.92)

As it happens, the evidence points to New Zealand having lower economic disparities than the United States, so we cannot be sure what the bishops would say about New Zealand. However I suspect they would be concerned about our poorest, particularly those who fall through the social security net perhaps because they have inadequate housing or health. Nor would the bishops likely to be happy with the differences in the economic statuses between men and women. And quite frankly, I would be much too embarrassed to even show them the evidence of the substantial disparities between Pakeha and Maori.

It is very easy at this stage to come back with the standard New Right response that the poor are poor through their own faults. I think it would be foolish to argue there are no poor who have defects which have lead them into poverty – one would have virtually abandon the notion of free will to rule out such possibilities.

But even acknowledging the possibility of there being some who are poor through their own faults, the evidence points to the majority of the poor, here and overseas, trapped in that state for `structural’ reasons. It is the way society is organised that keeps them there, not their own shortcomings.

In arguing this, it is unnecessary to equate poverty with material deprivation. The Royal Commission on Social Security’s notion of “inability to be able to participate and belong to society” is the encompassing notion.

The bishop’s go a step further when they argue that

“Social justice implies that persons have an obligation to be active and productive participants in the life of society and that society has a duty to enable them to participate in this way.” (p.36)

Providing, as I am sure is the bishop’s intention, that the notion of positive participation in the life of society is interpreted widely, I do not have many difficulties with their notion of `contributive justice’. What is unclear is what happens to those who do not fulfil the obligation. What are society’s duties towards them?

This question may be a bit theoretical when the main issue we, and the United States, face is that there so many people willing to fulfil their obligation to contribute to society, but unable to do so because society is failing in its duty by not offering them the opportunity. That group includes the structurally poor, and the unemployed.

The bishops are very strong on the need for full employment.

“Full employment is the foundation of the just society.” (p.69)

Thus they echo the New Zealand perception that full employment is the foundation of the welfare state. Given a current level of unemployment in New Zealand of between 7 percent and 12 percent, depending upon how it was measured, the bishops were particulary pertinent when they said

“We believe that 6 to 7 percent unemployment is neither inevitable nor acceptable.” (p.77)

`Neither inevitable nor acceptable’. That sounds like a severe critique of current economic policies does it not? Moreover the bishop’s account, while caring, is not uninformed in economic terms. It goes on

“While a zero unemployment rate is clearly impossible in an economy where people are constantly entering the job market and others are changing jobs, appropriate policies and concerted private and public action can improve the situation considerably, if we have the will to do so. No economy can be considered truly healthy when so many ….. people are denied jobs by forces outside their control. The acceptance of present unemployment rates would have been unthinkable twenty years ago. It should be regard as intolerable today.” (p.77)

Are the economic pundits and politicians listening? That is for the audience to decide.

Such were the sentiments of the bishops’ letters that some critics described it as `socialist’. That terminology seems curious to New Zealanders particularly as the bishops write

“The Catholic tradition has long defended the right to private ownership of productive property.” (p.57)

However in contrast to the approach of New Right to private property they go on

“Support of private ownership does not mean that anyone has the right to unlimited accumulation of wealth. Private property does not constitute for anyone an absolute and unconditional right. no one is justified in keeping for his exclusive use of what he does not need, when others lack necessities.” (p.58)

This is the biblical notion of stewardship of property. One has it only in so far as the property is used for the pursuit of the common good. A little earlier the bishops had said

“The common good may sometimes demand that the right to own be limited by public involvement in the planning or ownership of certain sectors of the economy.” (p.58)

`Planning’, `public ownership’. This is not the language of Rogernomics, nor the policies of the fourth Labour government. Those who thought their social democratic principles were fossils from an earlier era, may be surprised to learn that the US bishops are with them.

Actually we have been given a very peculiar account of modern political and economic thinking, because of the accident that the policies of the New Right have been most propounded by English speaking Reaganomics and Thatchernomics. There has been little realisation here as to just how isolated Mrs Thatcher is in European thinking.

For instance in the just elected European Parliament, there are more Greens than their are Tories, who are isolated from the main political grouping which opposes the socialist (slight) majority. The centre of that grouping are the Christian Democrats and their allies from a number of European countries. The expectation is that they, with the democratic socialists, will promote legislation to improve conditions for workers, to extend the social wage, and to provide regional and industry assistance.

Such a political thrust from the Christian Democrats is only surprising if one is surprised that Pope John Paul said

“One cannot exclude the socialisation, in suitable conditions, of certain means of production.”

As the bishops say

“The Church’s teaching opposes collectivist and statist economic approaches. But it also rejects the notion that a free market automatically produces justice.” (p.58)

We can guess what the bishops’ view on proposals to `deregulate the labour market’ are

“The Church fully supports the right of workers to form unions …. to secure their rights to fair wages and working conditions. …. Unions may also legitimately resort to strikes where this is the only available means to justice owed to workers. …. No one may deny the right to organise without attacking human dignity itself.” (p.53)

By New Zealand standards the bishop’s section on `Working People and Labour Unions’ is radical; enough to make a Patrick Kelly leave the Labour Party for the Catholic Church.

By now it should be evident that the bishops’ pastoral letter on the US economy is rich and relevant. It is time to turn to some of the criticisms.

First there are the technical issues. I have little time for those who support Rogernomics with the claim that economic reform was necessary and there was no other way. Economists who saw the need for major economic reform argued for quite different strategies than the one adopted here, strategies adopted overseas.

If some one insists there was no alternative ask what was so inevitable to require cutting the marginal income tax rate on the rich from 66 percent to 33 percent, making it one of the lowest -if not the lowest – in the western world?

Where I have greater problems is the time dimension. One argument for Rogernomics has been that goals such as the bishops propound are the ultimate objective of economic policy. However the government has had to do some savage things to the poor and unemployed in the short run to attain the objective.

I must say in fairness that the government has chosen not to attack verbally the poor in the traditional right wing rhetoric of their being benefit bludgers and scroungers. The necessary review and tightening of the administration of social security to reduce fraud has been done with some tact. In this respect the Labour government deserves recognition for the promotion of human dignity.

But how are we to approach their argument that in the long run the poor will benefit from the policies which are being implemented, even if they suffer in the short run? Sounds a bit calvinist does it not?

A good parallel is the findings of the Cartwright Commission on the activities at National Women’s Hospital. I take it that the doctors involved were sincere and believed they were acting in the best interests of their patients. I do not have the competence to judge whether the doctors were acting so, nor is it necessary to come to some assessment of this here. What I am clear about is that the patients were not adequately consulted.

The same issue applies to recent economic policy developments. The government may be taken as sincere and believe it is acting in the best interests of the poor and those on the margins of society, we need not judge here whether its treatment is the best available. However we can ask to what extent the underprivileged were consulted on the treatment that they have been given, to what extent they had it explained it to them, and to what extent they gave informed consent.

As the bishops say

“The obligation to provide justice for all means that the poor have single most urgent claim on the conscience of the nation.” (p.44)

In which case there is an obligation to consult them to find out what their claim is.

Let me free wheel for a paragraph. In principle, our democracy has a system of one person one vote, although there is bias in it towards the rich who have the economic means to accrue unequal political power to themselves. But even ignoring this bias, is the logic of the bishops’ position that the poor should have a greater weight in the voting system compared to the rest us? Or is this a democratic heresy?

So much for the technical problems involved in the bishops’ approach. Let me turn to the deeper ones of social philosophy. Recall my earlier remark that the Catholic Church is older than the modern industrial capitalist economy, in the way that most protestant churches are not. It is no accident that tonight I am reviewing a text described as a `pastoral’ letter.

In some ways the fundamental break is between the organisation of society around the social solidarity of preindustrial society, and the individualism of industrial society. As one writer said

“the traditional Catholic communitarian vision [is] of a human family ordered in organically related social structures”. ((Strain, p.190)

That is why the bishops are able to talk about the `common good’ with so little introspection, and it is clear that they do not merely mean the sum of individual preferences, which economists often interpret as the common good.

The procedure John Rawls proposes attempts to get around this conflict between the common good and individualism, but it does so at some cost.

I illustrate by drawing attention to the fact that my gender is obviously male. This is one of a number of personal characteristics which are a very integral part of me as a human individual.

As a result I find it most difficult to carry out the Rawlsian thought experiment from the position of a genderless human individual. It would not be me who is making that decision about my preferred choice of society.

(Of course I try to be empathetic to those of another gender. and that I have a mother, sister, wife, daughter, and women friends and colleagues helps me, I hope, to do this reasonably sensitively. But that is not the same as what the Rawlsian experiment requires.)

This is not an entirely theoretical issue. Suppose we said to everyone `what is the minimum income you would need to participate in and belong to society’, perhaps with the idea using the answers for designing distributional policy. For instance, if they were all to choose the same minimum income, and if this were practically deliverable, then it would be a candidate for the poverty line below which no one should fall.

However, everyone does not choose the same minimum income level for living comfortably, and as a general rule the higher one’s income the higher one’s required minimum standard of living. This may not be surprising, but its social implications are. First it says that the Rawlsian veil of ignorance is not going to be much help in trying to quantify an acceptable distribution policy.

Second it says if the rich knew how really poor were the poor, and they accepted the bishops’ social philosophy they would be appalled. Fortunately ignorance protects them from such a fate.

There is another strange thing about the Rawlsian thought experiment. I am expected to act selfishly behind my veil of ignorance. But perhaps I am not totally selfish. That reinforces the conclusion to the existence of some common good above the sum of our selfish decries.

I guess what I am bridling at is the Treasury type line which starts by noting that people make selfish decisions on occasions, and then goes on to argue that we should design public policy on the assumption that people always make selfish decisions.

A further problem with the Rawlsian approach is that it is not sufficiently comprehensive to lead to a complete economic policy, even if we can agree on how economies work, we could not generate a complete economic policy from mere Rawlsian principles.

This is getting a bit abstract, so I offer the easy illustration. Where would the Treaty of Waitangi fit into the bishops’ account, if they had been writing about the New Zealand economy rather than the US one? I do not think the Treaty, and treaty issues, are just an add on, but I do not see how easily to extend the pastoral letter to cover it. In other words there may well be important social issues not covered by the pastoral letter.

The majority of my criticisms are in the spirit of the pastoral letter; ones the bishops are likely to respond positively to. But I have tried to touch upon the criticisms of the New Right, particularly their concerns about the tensions between individualism and social solidarity. Those tensions loom large in any protestant assessment of the issues too.

The bishops were not unaware of them; after all the letter was written during the height of Reaganomics, and in many ways is designed as a response to that political philosophy, albeit a positive response rather than a carping one.

I think that is the way we have to approach Rogernomics and the economic policies of the fourth Labour government. That applies as much to its supporters as to its critics. We lack a sound, comprehensive and cogent philosophical account of what Rogernomics stands for, and as yet the criticisms are fragmentary rather than as profound as, say, the pastoral letter.

Ultimately those accounts are about articulating the soul of New Zealand. What then is the role of the religious person in articulating this soul of a secular society? The spirit of the bishops’ pastoral letter provides a guide when they say

“Sustaining a common culture and a common commitment to moral values is not easy in our world …. One of our chief hopes in writing this letter is to encourage and contribute to the development of the common ground.” (p. 11)

New Zealanders today feel the loss of the articulation of the nation’s soul more than at any time in my life. By debating such overseas contributions as the pastoral letter, and by doing so evolving their own indigenous account – including incorporating other sources such as the Maori perspectives – the religious can make a distinctive contribution to that common good. I would have thought such a purpose would be high among their priorities. Let us begin.