Blowing the Cover Off the Austrian ‘Cult’

In his apostolic letter Octo­gesima Adveniens (1971) commemorating the eightieth anniversary of Pope Leo XIII’s Rerum No­varum, Pope Paul VI wrote that “we are witnessing a renewal of the liberal ideology [which] asserts itself both in the name of economic efficiency, and for the defense of the individual against the increasingly overwhelming hold of organizations, and as a reaction against the totalitarian tendencies of political powers.” Despite the understandable appeal of this ideology, Pope Paul reminded us that “at the very root of philosophical liberalism is an erroneous affirmation of the autonomy of the individual….” This condemnation is hardly a novelty; it has been expressed, in varying ways, by all or most of the supreme pontiffs from the nineteenth century until today.

Many Americans will encounter a certain difficulty with these terms, because by liberalism the popes always mean classical liberalism, the doctrine that favors free-market economics and which has historically been hostile to Catholic faith and morals. While here in the U.S. this might seem like an unusual combination, in the rest of the world it is taken for granted. Even here, however, it is hardly unknown. Milton Friedman, for example, saw his support for both free-market economics and legalized abortion as an affirmation of the “autonomy of the individual” criticized by Paul VI. But in the U.S. the terminology is complicated — most of those who call themselves conservatives share important elements of the “liberal ideology,” while those who identify themselves as liberals (or progressives) are also liberals, although of a somewhat different sort. But all liberalism, of whatever type, is part of a movement that has historically been one of the most effective enemies of Christian civilization.

It is in the U.S. that the classical liberal ideology has had its chief locus for some time, and it exercises a powerful influence over the American mind. Even within the Church this is the case, and one thinks of such well-known writers as Michael Novak or George Weigel, or of the Acton Institute, an organization bold enough to choose the well-known nineteenth-century liberal Catholic dissenter and opponent of papal infallibility, Lord Acton, as its patron.

In The Church and the Libertarian Christopher Ferrara deals principally with a group even more extreme in its liberalism. His book takes a critical look at the libertarian adherents of so-called Austrian economics, and especially their chief Catholic spokesman in the U.S., Thomas E. Woods Jr. These individuals, most of whom are affiliated with the Mises Institute in Alabama, collectively offer not only an explicit criticism of papal social teaching but, to one degree or another, either argue for the legality of abortion, same-sex marriage and adoption, blackmail, and even more bizarre practices such as selling children to the highest bidder or starving them to death at the whim of their parents, or at least fail to condemn those among them, such as the late Murray Rothbard, one of their principal theorists, who do espouse such things. The Catholics among them do not necessarily think such practices are moral, only that they should be legal. They themselves, no doubt, are “personally opposed,” but they do not want to restrict the freedom of others who may want to do such things.

Austrian economics developed in the late nineteenth century from the writings of Carl Menger, which were considerably refined by Ludwig von Mises, both of whom were from Austria. Their work has been carried on by a number of disciples, notably Rothbard, Friedrich Hayek, and others, most of whom are Americans. As an economic theory, Austrian economics is a variation on the standard deductive neo-classical model, but in the hands of many of its practitioners, it has extended its reach into political theory and even moral philosophy. In fact, it has become something of a ruling philosophy that is supposed to explain nearly every aspect of human action and guide our conduct in many areas of life. Not without reason have some critics described it as a “cult.”

The most curious thing about the Catholics in the Austrian school is the degree to which they manage to pass themselves off on the unsuspecting as orthodox Catholics. For example, Ferrara amply documents Jeffrey Tucker’s writing in support of the legality of same-sex marriage and of the adoption of children by same-sex couples. Yet Tucker, as a promoter of Gregorian chant and the traditional Latin liturgy, continues to write for orthodox Catholic publications that would never allow a self-proclaimed progressive to write for them on any subject.

Now, not all libertarians are Austrians, but all or nearly all Austrian economists are libertarians. As such, they regard the state as an evil — perhaps as a necessary evil, but always an evil. They like to characterize the state as having “a monopoly on violence,” as if that were its essential characteristic. The high place given the state in Catholic thought does not move them at all — even the Catholics among the Austrians think that their system of thought is superior to the teaching of the Church. Whenever a conflict exists or arises between them and the Church, they simply announce that the Church is wrong, the popes have overstepped the correct bounds of their teaching mandate, and that is that. Yet they react with a certain amount of hysteria if anyone should accuse them of being dissenters or label them as “social modernists,” the term Pius XI used for those who dissent from the Church’s social doctrine. If ecclesiastical authority were as vigilant today about suppressing heresy and dissent as it was in 1910 or 1950, the Catholic Austrians would either have to shut up or leave the Church. But, alas, such is not the case, and they continue with their career of deception and misinformation to the hurt of not a few Catholics.

Hence the timeliness of Fer­rara’s book. He exposes the mechanics of Austrian thinking, some of the more loathsome conclusions they draw from it, and sets forth the clear teaching of the Catholic Church and her supreme pontiffs in opposition to the Austrian notions. Ferrara is particularly adept at pointing out the incoherence of many of the fundamental Austrian concepts and the inherent anti-Catholic bias of their liberalism and its offspring, capitalism.

Ferrara writes with the passion of old-fashioned Catholics in his denunciation of the exploitative economic practices sanctioned by the Austrians and by many other free-market Catholics. He skewers the Austrian polemic against just wages, unions, workplace safety, intervention by local government to block big box stores, etc. Ferrara partakes of that zeal for justice so noticeable in the writings of Pius XI and Pius XII when they taught on the social order. It is a delight to read his attack on ex­cessive CEO salaries and his explanation of the current recession, which, he rightly points out, was brought about by corporations and government in league with one another.

Ferrara offers distributism as the Catholic alternative to the Austrian model. This is commendable, but we should remember that the Catholic critique of economic liberalism that arose in the nineteenth century espoused not only distributism but other theories, such as those associated with the German Jesuit economist Heinrich Pesch. Distributism is certainly one Catholic approach, but it is going too far to say that it is the only approach acceptable to Catholics. While there are important overlaps between distributism and Pesch’s solidarism, they have different emphases. Both, however, accepted the teachings of the Church as expressed in the papal social encyclicals, unlike the Austrians who openly dissent from those teachings with their puerile claim that popes have no authority or competence to teach in the area of economic morality.

Ferrara also tends to interpret the principle of subsidiarity, first enunciated by Pius XI in Quadra­gesimo Anno, too rigidly. What Pius actually wrote is quite general: “It is a fundamental principle of social philosophy, fixed and unchangeable, that one should not withdraw from individuals and commit to the community what they can accomplish by their own enterprise and industry. So, too, it is an injustice and at the same time a grave evil and a disturbance of right order, to transfer to the larger and higher collectivity functions which can be performed and provided for by lesser and subordinate bodies. Inasmuch as every social activity should, by its very nature, prove a help to members of the body social, it should never destroy or absorb them.”

Pius was too wise to be specific here, and Ferrara is too doctrinaire when he suggests that subsidiarity sanctions only local laws regulating the economy or that it would necessarily be opposed to federal regulatory agencies such as OSHA. No doubt if all the mandates of papal social teaching were implemented, the intermediate bodies proposed by Leo XIII and his successors would take over most or all of the economic regulation presently carried on by the state. But Catholics should remember that Pius XI praised Catholic legislators who pushed for government regulation of the economy at a time when respectable opinion held that the state was the “mere guardian of law and order.” John Paul II in Centesimus Annus was likewise explicit about the need for the state to intervene in and regulate the market. There is room for legitimate differences of opinion here among Catholics, but the chief thing to note is that Catholic social teaching, always realistic in its judgments, recognizes that current circumstances must be taken into account before reforms are implemented. It would be foolish to dismantle federal regulation before intermediate bodies and local governments were in a position to take over that function effectively.

Some readers might be aware that Christopher Ferrara and his publisher, Remnant Press, have been associated with some rather sharp and, in my opinion, ill-conceived public criticism of recent Roman pontiffs and their governance of the universal Church. Obviously this review is not an endorsement of those criticisms. One need not agree with every policy of the post-conciliar popes to consider that kind of criticism as contributing little or nothing to Catholic discourse or to a genuine restoration and renewal of the life of the Church. But readers need not shy away for that reason from buying and reading this book. Ferrara clearly accepts the teaching authority of John XXIII, Paul VI, John Paul II, and Benedict XVI. He writes of matters that are part of the patrimony of the Catholic faith and that are of immense importance if there is to be any hope of restoring a sane social order or even merely helping Catholics to think according to the mind of the Church. Still less should one pay any attention to charges that Ferrara is motivated by personal animosity toward Thomas Woods, a former collaborator of his. Of course, no man can read another man’s mind, but there is no reason to look for any personal bias on Ferrara’s part, and he need not apologize for his forthright exposition of Catholic teaching and his sharp criticism of serious error and of those who propagate it.

His book is a timely contribution to the understanding of both Catholic teaching and its Austrian counterfeit. Any Catholic, especially any American Catholic, would profit from reading and studying it. The appeal of Austrian economics to ill-informed Catholics is such that the strong medicine of Ferrara is more than welcome, and will prove, one hopes, equally efficacious.