Tuesday, December 03, 2013

The economic wisdom of the Pope, ironically a long post.

This is an analysis of the economic commentary in the pope's little document.  Evangelii Gaudium.

"I. Some challenges of today’s world

52. In our time humanity is experiencing a turning-point in its history, as we can see from
the advances being made in so many fields. We can only praise the steps being taken to improve
people’s welfare in areas such as health care, education and communications. At the same time
we have to remember that the majority of our contemporaries are barely living from day to day,
with dire consequences.A number of diseases are spreading."

Which diseases and why are they spreading?  The fact that "His Holiness" doesn't mention a certain retrovirus and why it is spreading as much as it is doesn't bode well for forthrightness in this analysis.

" The hearts of many people are gripped by fear and desperation, even in the so-called rich countries. The joy of living frequently fades,"

Frequently?  How frequently?  More frequently than previously seems to be the implication, but there is no evidence, let alone statistics to support that.

"lack of respect for others and violence are on the rise,"

Again, not sure what he bases this on or even the time-frame. Historically violence has been going down for centuries.

"and inequality is increasingly evident.  It is a struggle to live and, often, to live with precious little dignity. "

This has always been the case for many, why is the Church suddenly concerned about it?

"This epochal change has been set in motion by the enormous qualitative, quantitative, rapid and cumulative advances occuring in the sciences and in technology, and by their instant application in different areas of
nature and of life. "

Note the reference to an "epochal change" directly after the reference to the struggle to live and live with little dignity.  Is the pope actually claiming this is a "change"?  Because if he is he is horribly ignorant of economic history.

"We are in an age of knowledge and information, which has led to new and often anonymous kinds of power."

Actually what's led to new and often anonymous kinds of power is government.  It wasn't simply knowledge and information but their gathering by secret intelligence organizations for instance that led to enormous numbers of people's emails being surveilled.

"No to an economy of exclusion

53. Just as the commandment 'Thou shalt not Kill' sets a clear limit in order to safeguard the
value of human life, today we also have to say 'thou shalt not' to an economy of exclusion and
Inequality."

And how is such an economy defined?

"Such an economy kills. How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points?"

Well because when the stock market loses two points that can mean that many, many people are poorer and therefore cannot spend or invest the money that would save the lives of many such women.

Also because the first thing happens every day, disproportionately in areas where the Catholic Church was influential in economics and politics, I might add.

"This is a case of exclusion. Can we continue to stand by when food is thrown away while people are starving?"

Food being thrown away by who?  In any case the cause of starvation isn't food being thrown away, it's government interference in the economy that has historically led to starvation, not people not
finishing their dinner.

"This is a case of inequality. Today everything comes under the laws of competition and the survival of the fittest,"

Really?  Because last I checked huge areas of the economy were not only not under those laws but were being actively preserved from any "survival of the fittest" test.  The banking system for instance
is full of firms that survive due to government action, despite their lack of fitness.  In fact due to the expansionary monetary policy of most of the Western world (especially the USA) many firms are
surviving only due to government largess.

"where the powerful feed upon the powerless."

And how do the powerful "feed upon the powerless"?  Is it a market process or one initiated, supported and continued by government?  Is it competition or the lack of it, guaranteed by government, that is allowing the powerful to feed on the powerless?  Look at the most egregious feeding and the answer is clear, where government is powerful, the predation is worst.  This is true in terms of geographic area (e.g. Africa), and area of industry (e.g. finance).

" As a consequence, masses of people find themselves excluded and
marginalized:"

And what maintains this exclusion?  Why are not people able to find a way to include themselves in the economy?  Blank-out.

"without work, without possibilities, without any
means of escape.

Human beings are themselves considered
consumer goods to be used and then discarded. "

By who?

"We have created a 'throw away' culture which is now spreading. "

Who is "we" how does this supposed "throw away" culture differ from
any other culture and where is the evidence that it is spreading?

"It is no longer simply about exploitation and oppression, but
something new. "

I don't suppose he's going to define "exploitation" at any point is he?  It's always used as an expression meaning something bad, but I never know what bad it represents.  It is simply an "anti-concept" a word designed to make it impossible to tell what the speaker means, and therefore impossible to dispute the condemnation implicit in the phrase.

"Exclusion ultimately has to do with what it means to be a part of the society in which we live; those excluded are no longer society’s underside or its fringes or its disenfranchised – they are no longer even a part of it. The excluded are not the 'exploited' but the outcast, the “'leftovers' "

So who is doing this exclusion?  Who is making them not a part of society?  How would that even be possible?  Well of course it's not. These people aren't being rejected from society but merely from being paid.  And the reason they're being rejected from that is because they don't generate productivity, that is they don't make things others want.  This is not exactly new.

"54. In this context, some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts,"

I see, and where exactly does the Pope, who is so ignorant of economic history he doesn't know what's happening NOW get that knowledge?  How is it that he can confidently proclaim something on such a profound and controversial topic?  Well let's look at the bibliography, the cited references.  Oh wait there are no cited economic texts, only citations of the bible and church documents. Needless to say they weren't peer-reviewed.

" expresses a crude and naïve trust in the goodness of those wielding economic power"

Oh god, is it really possible that he is that ignorant of economic theory?  Surely even he has heard that the whole point of economics is that incentives can ensure good results without anyone wanting good for others.  "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest." Adam Smith.  No?  Well what can you expect.


"and in the sacralized workings of the prevailing economic system."

The prevailing economic system is not the free market, and anyone who even casually follows the news knows this, or has deliberately avoided the knowledge.  Note that he nowhere talks about exclusion that results from anything other than the market.  There is no mention of trade walls, immigration restrictions or anything else that might cause someone to be excluded.  This is highly significant given the Church's support of highly interventionist governments that excluded people very effectively.  An honest review of the situation would require a few "mea culpas" in the form of apologies for all the victims of governments that deliberately enriched the rich and impoverished the poor, and which the Church was all in favor of.  Various fascist regimes for instance.

"Meanwhile, the excluded are still waiting. To sustain a lifestyle which excludes others, or to sustain enthusiasm for that selfish ideal, a globalization of indifference has developed."

Has developed?  Since when?  There has been a large amount of indifference towards the poor of other countries for as long as I can remember, and the Catholic Church can fairly be pointed to not only as participating in it, but in actively courting governments that made things worse for the poor.

"Almost without being aware of it, we end up being incapable of feeling compassion at the outcry of the poor, weeping for other people’s pain, and feeling a need to help them, as though all this were someone else’s responsibility and not our own. "

Compared to what?  When exactly has compassion and charity been so much more than now?  Because it certainly wasn't when the Church and it's friends were in power.

"The culture of prosperity deadens  us; we are thrilled if the market offers us something new to purchase. In the meantime all those lives stunted for lack of opportunity seem a mere spectacle; they fail to move us."

Prosperity has been a greater promoter of concern for others than
anything else in the history of the world, including the Church.

"No to the new idolatry of money

One cause of this situation is found in our relationship with money, since we calmly accept its dominion over ourselves and our societies."

I'm not sure what this means.  We accept that we have to pay people to get them to do lots of things for us.  Not sure how that means we "accept it's dominion" over us.

"The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person!"

No it originated in governments monkeying around with the money supply and lying about their accounts.

"We have created new idols. The worship of the ancient golden calf (cf. Ex 32:1-35) has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose."

Again I have no idea what this means.  I don't know about you but my purchases have a truly human purpose, to fulfill my needs as I perceive them.  Calling a process that allows millions of choices a "dictatorship" is hardly accurate. You choose what you want and how you want to pay for it, within constraints of productivity.  That's reality not dictatorship.

 "The worldwide crisis affecting finance and the economy lays bare their imbalances and, above all, their lack of real concern for human beings; man is reduced to one of his needs alone: consumption."

Wow, consumption is "one need" rather than thousands.  All right, fine.  The
problem is that the crisis doesn't reduce him to one need, it simply means one
set of needs is difficult to satisfy right now.  That doesn't mean he suddenly
becomes inhuman just because people are focusing on that need right now.  It
simply means that there is such a thing as Maslow's hierarchy of needs.


"56. While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation."

Really?  Who holds these ideologies and how are they imposing their will on the economy?  Because I know of not one believer in the "absolute automony of the marketplace and financial speculation" that has any position of power.  Blaming it all on "market fundamentalists" may have flown back in 2007, when some people might not have noticed Bush, Greenspan and Paulsen were highly interventionist and always had been.  Now after the bailouts, QE I, II, and III, trillions of dollars in secret government loans, only a complete fraud or ignoramus would go that route.

"Consequently, they reject the right of states, charged with vigilance for the
common good, "
A charge for which there is no evidence and which can be dismissed.

"to exercise any form of control."
Yeah states have been exercising quite a bit of control.  In fact an overwhelming
amount.

"A new tyranny is thus born, invisible and often virtual, which unilaterally and
relentlessly imposes its own laws and rules."

Nope, same old tyranny, government.

"Debt and the accumulation of interest also make it difficult for countries to realize the potential of their own economies and keep citizens from enjoying their real purchasing power. "

Yeah and who's debt is that?

"To all this we can add widespread corruption and self-serving tax evasion,
which have taken on worldwide dimensions. "

Again "taken on", since when?  How is this different from what always happened?

"The thirst for power and possessions knows no limits."

Indeed, and who is statisfying that thirst most effectively and most harmfully?

"In this system, which tends to devour everything which stands in the way of increased profits,"

Government stands in the way of many people's profits, in fact it stands in the way of people even keeping their own money, like in Cyprus.  Yet I do not see it being devoured.  Note the weasel words here "tends to".

"whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule."

Again the market is hardly the "only rule", if he had bothered picking up a paper he would have found quite a lot of rules regarding many things including greenhouse gases, monetary policy, and regulations on practically everything.

"No to a financial system which rules rather than serves"

And what sort of financial system is that?  Is it based on government control of
the money supply, or private?

"Behind this attitude lurks a rejection of ethics and a rejection of God. Ethics has come to be viewed with a certain scornful derision. "
By who?

"It is seen as counterproductive, too human, because it makes money and power relative."

Seen by who?  And since when were power and money not relative?

"It is felt to be a threat, since it condemns the manipulation and debasement of the person."

And what does this "debasement" consist of?  Again who feels this?

"In effect, ethics leads to a God who calls for a committed response which is outside the categories of the marketplace."

Firstly ethics don't lead to any god, capitalized or not.  Ethics lead to conclusions about what is appropriate behavior, not whether or not there is a "God" to witness it.  I understand you have no knowledge of real morality but you should do some research.  Not every moral system is based on your imaginary friend.

But what does the phrase "outside the categories of the marketplace" mean?  The marketplace includes all who are capable of trading and they have different categories.  Some of those categories include benefits to others.  People trade in the marketplace with the aim of benefiting others all the time.

"When these latter are absolutized, God can only be seen as uncontrollable, unmanageable, even dangerous, since he calls human beings to their full realization and to freedom from all forms of enslavement."

Actually God was fine with enslavement, read your bible.

"Ethics – a non-ideological ethics – would make it possible to bring about balance and a more humane social order. "

A non-ideological ethics, and what exactly does that mean?  How can ethics NOT be informed by what you believe to be true?  And why would such an ethics, even if possible lead to a more human, rather than more insane, social order?

"With this in mind, I encourage financial experts and political leaders to ponder the words of one of the sages of antiquity: 'Not to share one’s wealth with the poor is to steal from them and to take away their livelihood. It is not our own goods which we hold, but theirs'.55

I'll ponder it for them.  It's bullshit.  The fact that you don't give someone something that they did not create, did not pay for, and you have not in any way promised them or obliged yourself to give to them, doesn't mean you stole from them.  The fact that you continue to breathe doesn't give you the right to all my stuff.  Note that the church was OK with lots of ACTUAL theft for centuries.

"58. A financial reform open to such ethical considerations would require a vigorous change of approach on the part of political leaders. "

Why yes, and we've seen the results of such a "change of approach" a number of times.  It's not pretty.  Fundamentally it's an approach where no man can count on a single hour of his effort remaining his, a slavery of all to all.

"I urge them to face this challenge with determination and an eye to the future, while not ignoring, of course, the specifics of each case."

Note the weasel words here.  If disaster happens when following the Pope's advice it's because they ignored "the specifics of each case".

"Money must serve, not rule!"

Money by definition has only the power of consent, you cannot be ruled by money,
since you can choose to ignore what it offers.

"The Pope loves everyone, rich and poor alike, but he is obliged in the name of Christ to remind all that the rich must help, respect and promote the poor. I exhort you to generous solidarity and to the return of economics and finance to an ethical approach which favours human beings."

As opposed to what, favoring lizardmen?

"No to the inequality which spawns violence

Today in many places we hear a call for greater security. But until exclusion and inequality in society and between peoples are reversed, it will be impossible to eliminate violence."

Of course he offers no evidence that this is true or that once "exclusion and inequality in society" is reversed the violence will abate.

" The poor and the poorer peoples are accused of violence,"
Note "accused" without any comment on the accuracy of the accusation. Whether someone accused is guilty or not is significant to me, but then I don't have ethics that lead to God.

"yet without equal opportunities the different forms of aggression and conflict will find a fertile terrain for growth and eventually explode."

And how are "equal opportunities" defined?  Are we talking "everyone gets an education"  or "everyone's parents get the same income"?  No indication.

"When a society – whether local, national or global – is willing to leave a part of itself on the fringes, no political programmes or resources spent on law enforcement or surveillance systems can indefinitely guarantee tranquility.  This is not the case simply because inequality provokes a violent reaction from those excluded from the system, but because the socioeconomic system is unjust at its root."

By what definition of justice?  Who is doing the "excluding" and in what does it consist?  Is he saying that not giving people stuff is "unjust at it's root" without any reference to whether they created any value?

" Just as goodness tends to spread, the toleration of evil, which is injustice, tends to expand its baneful influence and quietly to undermine any political and social system, no matter how solid it may appear."

Note that the Church tolerated far worse evils than merely not giving people free stuff.  They were OK with slavery, serfdom and racial and other discrimination in economic matters.  There is no mention of this, yet we're expected to take their criticisms as valid?  Sorry, if you're not prepared to acknowledge your own mistakes I don't have to listen to your theories of what is right.

" If every action has its consequences, an evil embedded in the structures of a society has a constant potential for disintegration and death. "

And when is this fraud going to get to the the actions of governments?  When is he going to say "Oh and there are bad things done by governments too, and here they are."?  Never.

"It is evil crystallized in unjust social structures, which cannot be the basis of hope for a better future. We are far from the so-called 'end of history', since the conditions for a sustainable and peaceful development have not yet been adequately articulated and realized."

He's right they haven't.  Certainly not in this pile of offal.

"Today’s economic mechanisms promote inordinate consumption,"

Which mechanisms and how?

"yet it is evident that unbridled consumerism combined with inequality proves doubly damaging to the social fabric."

Oh yes it is evident.  I can see that in the imaginary peer-reviewed research papers you cited.
Oh course what "unbridled consumerism" actually means I don't know.  Since 2007 it's been fairly
bridled, certainly compared to before.

"Inequality eventually engenders a violence which recourse to arms cannot and never will be able to resolve. It serves only to offer false hopes to those clamouring for heightened security, even though nowadays we know that weapons and violence, rather than providing solutions, create new and more serious conflicts."

And your own solution of dissolving property rights, how has that worked out for solving violence?  Not well IIRC.

" Some simply content themselves with blaming the poor and the poorer countries themselves
for their troubles;"

Again, no mention of whether these accusations are accurate.

"indulging in unwarranted generalizations, "

Yes, I hate it when people indulge in unwarranted generalizations.  Particularly for 190 goddamn pages.

"they claim that the solution is an “education” that would tranquilize them, making them tame and harmless. "

Who claims this?  What are you talking about?  And since when is this a stone the Church should cast?  They've been "educating" the powerless to be accepting of tyranny for a long time now.

"All this becomes even more exasperating for the marginalized in the light of the widespread and deeply rooted corruption found in many countries – in their governments, businesses and institutions – whatever the political ideology of their leaders. "

Finally a mention of government evil.  Note that he doesn't draw any conclusion from the presence of evil in government, it ignores the implications for his own plan of giving governments power. This is this part of the statement's real function.  Not to deplore exclusion and inequality but to selectively excuse and hide it.  When someone says they hate the harms of usury, but mention only Jewish usury, you know they really hate Jews.
When someone mentions that they hate totalitarianism but only mention either fascist or communist crimes and not the other, you know they hate fascism or communism, not totalitarianism.  When someone says they hate inequality and exclusion and they ignore the centuries of such enforced and encouraged by government, you know the do not hate inequality and exclusion, they hate the market.