Economics as if God Mattered

In economics, as in all else, the City of Man proceeds as if God did not exist. A writer in The Times Literary Supplement pointed out recently that capitalism is not an ideology, but simply the normal greedy way people act in economic affairs. This greed — euphemized as “enlight­ened self-interest” — has in fact been ideologized, and the resultant “liberal” or “free­ market” economics legitimizes acquisitiveness in a manner similar to that in which the risible “Playboy philosophy” helped legitimize lubricity; the problem with poor Hugh Hef­ner’s “philosophy” is that it lacks the intellectual sophistica­tion and the graphs and alge­braic equations of the econo­mists defending capitalism.

Compared to capitalism, which is a rationale for avarice, Marxist socialism is hopelessly overpowered. Its utopian attempt to conquer greed through statist action has failed, as was bound to happen. Now the USSR and other Communist countries are trying to introduce capitalism, in some form or other, in order to pull themselves out of the mess Marxism has made.

At this significant histori­cal moment, the first English translation of an extended work by Heinrich Pesch, a German Jesuit economist who died in 1926, has been pub­lished. Pesch, who opposed both capitalism and socialism, is a giant of Catholic economic theory whose influence on Quadragesimo Anno and subse­quent papal economic teaching is palpable. While the book under review here is not his magnum opus (namely, Das Lehrbuch der Nationalökonomie), it is nevertheless quite illuminat­ing. (Das Lehrbuch is currently being translated by Rupert J. Ederer, who translated the book under review here. For Ederer’s overview of Pesch, the reader may wish to consult Ederer’s “Heinrich Pesch and the Economics of Solidarism” in the Nov. 1986 NOR.)

Pesch does not conflate economics with ethics, but he insists that the two are related. Economics is an autonomous science, though not an apodictic one, with its own formal object and methods. It is also a human endeavor and, as such, cannot be totally separated from other human realities such as ethics and culture. Pesch analyzes — in a sophisticated and scholarly, though not inaccessible, manner — such subjects as work, ownership, the acquisition of material goods, and just prices. This is not a long book, but it is long enough to demonstrate by its richness and depth the shallowness of worldly eco­nomic ideologies. Important as it is, the book is not the Catholic equivalent of Das Kapital, The Wealth of Nations, or Keynes’s General Theory. For that we must await Das Lehr­buch. Even there, however, Pesch does not provide a ready-made system, because he takes history and cir­cumstances seriously. What he does set forth are economic principles and methods of analysis that are meant to provide for the creation of an economy at the service of man (not just some men), and built upon justice and charity.

It is interesting to observe how Pesch, writing in 1918, in effect answers those free-mar­ket advocates of the 1980s (like Fr. James V. Schalbpwho ac­cuse Catholic economics of be­ing unconcerned with, or at least ignorant of, wealth crea­tion. Pesch addresses the ar­gument that capitalism has re­sulted in “productive energy,” “more and cheaper goods,” and that it has “increased the wealth of the nation and ele­vated the standard of living of workers” this way: “No one is denying all of that…. Who would wish to stand in the way of the onrush of new energies and the healthy increase of individual efficiency by opposing the advance of technology for the sake of tradition?… Whatever indus­try may have accomplished in modern times that may be deemed as progress must be preserved by all means…. Only the detriments and harm caused by modern develop­ment have to be eliminated.” Pesch evinces none of the romantic anti-industrialism of Chesterton, Belloc, Eric Gill, or Peter Maurin, which some people erroneously equate with Catholic economics.

Were he writing today, Pesch’s book might be different in two respects. I note these as observations more than criticisms. First, the emphasis on the national economy might give way more to questions of international economics, given the increas­ing interdependence of the world economy. This could be done without amending any of the principles he expounds. Secondly, Pesch’s exposition, which is solidly within the Thomistic natural-law tradi­tion, might incorporate, as so many orthodox Catholic think­ers have done recently, the insights and methodologies of personalism and phenomenol­ogy. Pope John Paul II has done so in his encyclical Labo­rem Exercens, which, by the way, is quite Peschian.

Pesch is still the Church’s greatest economic theoretician and the publication of this translation is a major event. Anyone with a serious interest in Catholic economic teaching can ill afford to leave this work unread. But be fore­warned: Reading it will be like stepping into another world, one in which the economy is not an impersonal system governed by “invisible hands” or “laws,” be they those of the historical dialectic or those of supply and demand. In Pesch’s world (which is the real one, incidentally) econom­ics is an activity of free beings made in the image and like­ness of God. Pesch writes: “Capitalism, which has caused so much mischief and so much confusion…is not merely some kind of economic con­cept. It is a matter of how people approach each other. It would be foolish to expect salvation from simply a new economic system if the nation and its people do not become morally better, if the material­istic egoistical spirit…is not replaced once again by a genuine Christian spirit….”

Pesch, as a Catholic, saw clearly that economics is a human activity that, like any such activity, needs to be redeemed by the Messiah. Pesch, as an economist, did not prescind from this reality, but worked from it. He gave us an economics worthy of human beings, an economics as if God mattered.