The green Pope: how religion can do economics a favour
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Version 0 of 1. Palpable shock met Tuesday’s news of the Pope’s unequivocal and outspoken intervention in the debate on climate change and global inequality. The stir caused by his latest encyclical could partly be due to generally low expectations of the Catholic Church following years of relentless, negative scandal. But we shouldn’t be surprised. The world’s major religions all have economic teachings that apply to how we treat the planet and each other, and which often starkly contradict orthodox economic models. Modern economics views itself as value free, but that wasn’t always the case and the major faiths all view economic prosperity through a moral lens. If that makes business leaders or economists squirm, it’s worth remembering that the grandfather of market economics, Adam Smith, wrote about The Theory of Moral Sentiments. To him, the economy was rooted in an explicitly moral universe. Whether we’re aware of it or not, and regardless of the fulminations of anti-environmental, extreme, right wing Republican Christians in the US, the economic teachings and moral frameworks of the great faiths profoundly shape how we view the path to prosperity, sometimes in surprising ways. Related: Good, natural, malignant: five ways people frame economic growth On this, the Catholic Church has form. Small is Beautiful by EF Schumacher is probably the most influential text on green economics ever written. As a collection of essays by a former industrial economist, who for two decades after the second world war was chief economic adviser to the National Coal Board, it did more than anything else to reimagine economics as servant to a convivial society living in balance with the environment. But its most enduring idea from which the book’s title is derived, about the importance of scale, was taken straight from a papal encyclical. Schumacher took subsidiarity, the principle that things are always best done at the lowest practical level, from an encyclical of Pope Pius XII issued in 1931 in the wake of the economic catastrophe of the Great Depression. It is an injustice and disturbance of right order to push power up rather than down, it said, insisting that nations which do the latter will be happier and more prosperous. Today local democracy, decentralised food and energy systems and local participatory budgeting are arguably better paths for progress. Following the Pope’s encyclical this week on the need for a more equal global economy that respects planetary boundaries, high-profile church figures from across the spectrum of faiths echoed his concerns. The Christian faith has an honourable tradition of criticising capitalism and the excesses of the market, and of insisting on different ways of doing things, not least since the crash of 2007–08. Famously, medieval Christianity placed a prohibition on usury, the charging of punitive interest on loans. That was only relaxed with the emergence of an aggressive mercantile middle class. Islamic banking today, at least notionally, still operates without the charging of formal interest. There is also a debate in green economics about the degree to which interest-bearing loans are hard–wired to an environmentally destructive growth imperative. Related: Companies cannot keep shying away from setting tough climate targets It was the church and church-based development agencies that more recently through the Jubilee 2000 campaign turned on their head attitudes toward the debts of nations – particularly relevant today concerning the perilous situation of Greece – based on a key idea of Judaism: Jubilee. This requires the periodic cancellation of debt, recognising that debts can lead to a form of bondage, like slavery, from which it becomes impossible to escape, producing socially corrosive inequality. It is therefore humane and economically sensible to wipe the slate clean. Until the Jubilee 2000 campaign, many of the world’s countries were trapped with unpayable debts that creditors said would be morally hazardous to write off. In terms of how to live, Judaism also brings the idea of Shmita, the notion that we should not overwork the land and leave it fallow every seventh year. Islamic banking likewise teaches that it is a bad thing for people to have too much or too little. Zakat, the tax by which surplus income is then redistributed, is like the proposal for a plenty line in addition to a poverty line to identify an optimal upper income level that ensures needs are met, but beyond which there is little human gain and where damaging overconsumption kicks in. Related: Beyond capitalism and socialism: could a new economic approach save the planet? Schumacher wrote a famous paper on Buddhist economics in which he accused economists of suffering from “metaphysical blindness”. The orthodox view of work as a necessary evil and wage compensation for the sacrifice leads to overall impoverishment through progressive reduction of the task, division of labour and specialisation to point of tedium and alienation, argued Schumacher. Buddhist economics instead sees the point of work as to utilise and develop our faculties, overcome ego-centredness through participation in common tasks and bring forth goods and services. In other words, work is not to bore and stultify us, but nourish and develop. There are also, importantly, Gandhian notions of self-reliance deeply rooted in religious teaching, which envisage more locally rooted economies as the path to sustainable prosperity. Speaking about earlier waves of economic globalisation, and with unintended intimations of the upheaval in a warming world, Gandhi said, “I do not want my house to be walled in or my windows blocked. I want the cultures of all lands to be blown about the house as freely as possible. But also I refuse to be blown off my feet by any.” Old notions of economic success created a dangerously divided, unequal world dancing on the edge of ecological collapse. The economics profession must reinvent itself with a model retuned to the challenges of our time. While we wait, we can have a little faith that others are stepping forward to challenge attitudes and set our imaginations free towards rethinking prosperity. |