I am honored to be with you today and was pleased to receive your invitation to speak to this conference of The Pontifical Academy of Social Sciences. Today we celebrate the encyclical Centesimus Annus and reflect on its meaning for our world a quarter-century after it was presented by Pope John Paul II. With the fall of Communism, Pope John Paul II gave a clarion call for human freedom in its truest sense: freedom that defends the dignity of every person and that is always oriented towards the common good.
The Church’s social teachings, stretching back to the first modern encyclical about the industrial economy, Rerum Novarum in 1891, to Centesimus Annus, to Pope Francis’s inspiring encyclical Laudato Si’ this past year, have grappled with the challenges of the market economy. There are few places in modern thought that rival the depth and insight of the Church’s moral teachings on the market economy.
Over a century ago, Pope Leo XIII highlighted economic issues and challenges in Rerum Novarum that continue to haunt us today, such as what he called “the enormous wealth of a few as opposed to the poverty of the many.”
And let us be clear. That situation is worse today. In the year 2016, the top one percent of the people on this planet own more wealth than the bottom 99 percent, while the wealthiest 60 people – 60 people – own more than the bottom half – 3 1/2 billion people. At a time when so few have so much, and so many have so little, we must reject the foundations of this contemporary economy as immoral and unsustainable.
The words of Centesimus Annus likewise resonate with us today. One striking example:
Furthermore, society and the State must ensure wage levels adequate for the maintenance of the worker and his family, including a certain amount for savings. This requires a continuous effort to improve workers’ training and capability so that their work will be more skilled and productive, as well as careful controls and adequate legislative measures to block shameful forms of exploitation, especially to the disadvantage of the most vulnerable workers, of immigrants and of those on the margins of society. The role of trade unions in negotiating minimum salaries and working conditions is decisive in this area. (Para15)
The essential wisdom of Centesimus Annus is this: A market economy is beneficial for productivity and economic freedom. But if we let the quest for profits dominate society; if workers become disposable cogs of the financial system; if vast inequalities of power and wealth lead to marginalization of the poor and the powerless; then the common good is squandered and the market economy fails us. Pope John Paul II puts it this way: profit that is the result of “illicit exploitation, speculation, or the breaking of solidarity among working people . . . has not justification, and represents an abuse in the sight of God and man.” (Para43).
We are now twenty-five years after the fall of Communist rule in Eastern Europe. Yet we have to acknowledge that Pope John Paul’s warnings about the excesses of untrammeled finance were deeply prescient. Twenty-five years after Centesimus Annus, speculation, illicit financial flows, environmental destruction, and the weakening of the rights of workers is far more severe than it was a quarter century ago. Financial excesses, indeed widespread financial criminality on Wall Street, played a direct role in causing the world’s worst financial crisis since the Great Depression.