The Vatican has launched a stringent critique of widespread abuses in global economies, abuses that are driving astonishing inequality, threatening ecological sustainability and unleashing powerful reactionary political forces.
The title of the Vatican document Oeconomicae et pecuniariae questiones can be translated as 'On Economic and Financial Matters'. It was written by the newly formed Dicastery for Promoting Integral Human Development together with the Congregation of the Doctrine of the Faith. Approved by Pope Francis on 6 January, it was not released till 17 May with a clumsy last-minute English translation.
It reiterates the call by Francis in Laudato Si' for an urgent dialogue between politics and economics to advance human life and wellbeing. 'Money must serve, not rule!' (#6).
The 10,000-word document encapsulates the strong critiques of forms of economics most responsible for current social and economic crises, drawing strongly from the documents of Francis and his predecessors. Informed by the thinking of many leading scientists and economists advising the Vatican agencies, it warns urgently to reduce extreme inequalities and address climate issues before they become truly catastrophic.
The critique in Oeconomicae centres on the growing influence of economic thinking that exaggerated the role of free markets, believing that markets of themselves, without adequate regulation, produce the best results, while ignoring concerns about liberty, social equity and human wellbeing.
'At stake is the authentic wellbeing of a majority of men and women of our planet who are at risk of being excluded and marginalised' while a rich minority, 'indifferent to the condition of the majority, exploits and reserves for itself substantial resources and wealth'.
The document does not attempt to adjudicate between rival economic theories, and does not use the term neoliberalism, though that is implied, but insists that economics must not abandon the profoundly moral task of promoting the human wellbeing of everyone, especially those in need.
"Never has this call to protect the common good been so dramatic and immediate."
The Vatican document recognises the value of markets in coordinating production of abundant goods to serve human needs, but argues that public authorities need to regulate financial markets to curtail malpractice. Experience has shown 'how naïve is the belief in a presumed self-sufficiency of the markets, independent of any ethics', and how necessary is 'appropriate regulation' to protect all involved, especially the vulnerable. (#21).
Financial manipulation
It warns that 'massive deregulation' has opened the way for moral risk and embezzlement, as well as 'the rise of the irrational exuberance