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Pope Pius XI defines the aim of economics

Written by Louis Even on Wednesday, 01 August 2001. Posted in Social Doctrine

No one dare attack the financial dictatorship

Ten years before Pius XII's radio message (published in the last issue of "Michael"), his predecessor, Pius XI, had also defined the aim of an authentic economic and social organism. He too stressed the right of every individual ("all and each", he said) to an appropriate share in the production of their country.

The quotes from Pope Pius XI are set in bold type and put in quotation marks. The comments, set in light type, are from us.

In his masterly Encyclical Letter "Quadragesimo Anno", May 15, 1931, Pius XI. wrote:

"For then only will the economic and social organism bé soundly established and attain its end, when it secures for all and each those goods which the wealth and resources of nature, technical achievement, and the social organization of economic affairs can give."

And this access for all, for each to the production of their countries must not be parsimoniously limited to the bare necessities of life:

"These goods should be sufficient to supply all needs and an honest livelihood, and to uplift men to that higher level of prosperity and culture which, provided it be used with prudence, is not only no hindrance but is of singular help to virtue."

There is in no way question in these words of a socialist economy, but of a social economy. Social, especially by the efficiency of a form of distribution that carries the goods wherever human beings need them.

The goods to be distributed come from natural resources, which are God's work; from industry, which is men's work; and from the regulation of the economic and social organism of the country.

The sum of the goods that come from the three sources mentioned above make up a whole, which is supplied by different producers who are organized in various ways, and who might even be competitors. But the distribution of these goods must reach each person, each family.

What is lacking?

It is clear that one can distribute only what has been produced. No one can deny that the capitalist economy exceeds by far the socialist economy. So it can distribute more; and if it did it properly, there would be no ground to depreciate it, nor to have one's eye on socialism, with its economy of inadequate and rationed production, submitted to political servitude.

In fact, it is much easier to distribute than to produce if no artificial obstacles stand in the way. But there are such artificial obstacles in the capitalist economy of abundance. They are caused by the financial system. Nobody can deny it, because it is there that even governments at all levels get stuck.

Earthly goods which according to distributive justice, must be available to all and each, are the goods and services necessary for a living. Nature and industry are good servants to procure them. What is lacking is appropriate legislation to this end in the organization of distribution.

This piece of legislation and the regulations to be established must be prepared by civil governments. Both Pius XII in his radio address and Pius XI in his encyclical letter hold the same view on this point. The only difference is that an encyclical letter is longer than a radio address; so Pius XI, in "Quadragesimo Anno", presents more aspects of the question.

A superdictatorial power

Speaking about "economic dictatorship following from free competition", Pius XI denounces "the accumulation of power resulting from the concentration of wealth into the hands of a few", and he specifies:

"This power becomes particularly irresistible when exercised by those who, because they hold and control money, are able also to govern credit and determine its allotment, for that reason supplying so to speak, the lifeblood of the entire economic body, and grasping, as it were, in their hands the very soul of production, so that no one dare breathe against their will."

Can anyone expect from such a dictatorship the realization of distributive justice, especially when a few lines farther, the Pope must stigmatize the degradation of the government:

"The State which should be the supreme arbiter, ruling in kingly fashion far above all party contention, intent only upon justice and the common good, has become instead a slave, bound over to the service of human passion and greed."

What attention has been paid to these quotations of "Quadragesimo Anno"? Is the economic dictatorship, the financial dictatorship of less importance? Have the governments freed themselves from it or are they still its slaves?

An indispensable bond

In our modern world, the products actually reach the needs only when those needing them present to the producer, to the retailer, or to the market of these products tokens, tickets called money. This money allows the person who possesses some to choose, up the amount he owns, among the variety of goods offered, what best suits his needs.

That method is good. It allows a freedom to choose, which indicates automatically to the producers what they must try to produce, quantitatively and qualitatively, in order to satisfy the consumers.

But still the individual or the family wishing to profit by this service must present money. He may well possess rights, fundamental or acquired, if he does not have the money tickets, he will not be served.

But how can the attribution of these tickets be in compliance with the rights, with the requirements of justice, when the control of money and credit is in the hands of an almighty dictatorship for which the fate of the have-nots is none of its cares?

There are brains stocked with knowledge to overflow, multi-graduates from universities, prominent people in national and international politics, even Reverends and Most Reverends, who seem to totally ignore the existence of a tyranny to which one must ask the permission to breathe. They ignore it, unless they are their tacit partners. Or they do not assess its seriousness.

However, no need to possess much bookish instruction to verify the existence of economico-financial regulations having force of law, while they are insulting simple common sense. A few notes given here will perhaps help some unprejudiced minds to take an interest in a topic new to them.

A tale

Let us begin with a little tale. A fable, if you like, embellishing a fact so stupid that everybody laughs at it, but that nobody will even dare believe it. However, it explains pretty well present situations which are themselves unfortunately real and the results of which are disastrous.

So, in the parish of St. Twisting where every problem was carefully and seriously studied, in order to solve it in the most respectable way, three beautiful new bells with three strong ropes had been installed in the steeple of the church, by the select vestry, to call the parishioners to great ceremonies. All the population was proud of them and the churchwardens were well congratulated for this.

A little problem, however, soon began to bother the people, lightly enough when entering the church one by one or a few only at a time, but more seriously when coming out in crowds. More than 4 feet of each rope was dragging on the floor, in the middle of the vestibule. As everybody was hurrying, many feet got twisted, which was very annoying for the victims and was causing a congestion of traffic.

The churchwardens were not long in discovering that; and they called an emergency session to find a solution to the problem. After serious thinking, two solutions were brought forward. Some suggested a six-foot raising of the steeple, the others suggested rather a six-foot lowering of the floor. Their suggestions were mathematically equivalent to keep the ends of the ropes two feet above the floor, which would still allow to catch easily the ropes and hold them to ring, but would not bother the feet any longer.

But which solution should be favoured? Which one would necessitate less work and cost less? Raising the steeple seemed to be the more complicated and the longer to realize, but it would be done once for all. While lowering the floor would necessitate the addition of two stairs, one to go down six feet when entering the vestibule and another one to go up six feet when entering the church; same thing in the other way when going out. So the people would be obliged to practise this up-and-down exercise twice, each time visiting the church.

The session of the churchwardens ended on an unfinished business: they were to call the people, surely interested, and to submit the two suggestions to their choice.

There also, the votes were almost of equal share. The churchwardens remained more puzzled than before: by choosing either of the two suggestions, there would be an important number of unsatisfied people.

Suddenly a nine-year-old schoolboy, who had accompanied his father to the meeting, coming to understand what was the matter, cried out without notice: "But why not take a good knife and cut the ropes six feet shorter?"

The tale ends here. But if you wished to complete the fable in order to have a better representation of what is going on today in the exploration of important social problems, it would show us the august body of churchwardens calling the little instructor to order, ordering him to produce his diplomas, or, for want of, to leave at once; if he insists, he can still speechify here and there or go from house to house, trying to have some ignorant people of his kind swallow his foolish ideas!

And now, let us become acquainted with the most exasperating but the less denounced fault of our economic structure, its financial system. With a non-elected power, but worshiped as a "sacred cow" by all the legitimate established powers.

The "sacred cow"

The useful production of our industrialized countries fills up our warehouses. Shelves and back-stores of our stores are full of them. The means to deliver them everywhere are waiting orders eagerly. Merchants are anxious to serve customers. They complain for not having more, while individuals and families complain for not being able to order more goods in order to satisfy urgent needs.

Please tell us, gentlemen sociologists, humanist experts anxious to promote a good measure of distributive justice in the world, is the obstacle coming from a lack of goods or from a lack of money? Is the situation you deplore pertaining to physical order or to financial order? Are you to consider it a sinful lack of ethics, as a selfish contradiction of interests, while wishes of those offering goods and wishes of those needing them coincide and when both sides suffer from the same obstacle? Are you to accuse the system producing on request, even faster than the request, goods, means of preserving them, means of transportation, means of delivery?

Or maybe are you to refrain from all accusation, standing in awe and petrified to silence, because the guilty one is evidently of financial order? Besides, it is as much prejudicial to capitalist producers as to families and people having a fundamental right to a sufficiency of goods.

Are you also going to stop flatly in front of the label "Finance" which seems to mean for the prospectors of justice as well as for the responsible members of the governments: "Here, sacred cow, keep away!"

The major problem is the same, a problem of financial order. Whether it is considered at the national level or at the international level, even if other problems are raised in less developed countries. Even with the very legitimate differences in standards of living among nations of quite unequal development, there is in the whole enough to satisfy the normal needs of men, without having to suspend the huge majestic productions of developed countries. No matter from which country they rise, goods today can reach rapidly and easily all the continents and all the islands in the world. This is much less complicated than to go and search a few pounds of dirt on the moon!

But for that, the financial system must be put at the disposal of physical possibilities in order to satisfy human needs, but not to confine these possibilities to the orders of a stray financial system which forgets its real object of "financing". Financing production instead of regulating it, financing distribution instead of clogging it or imposing its conditions to it.

Otherwise, we are lost, as the churchwardens of St. Twisting who wanted to make violence to the steeple or to the floor in regard to the length of the ropes instead of adjusting the ropes to the distance between the steeple and the floor, as they should have done. They needed a nine-year-old philosopher to remind them that the means must serve the ends, and not the contrary. A little engineer who also showed them how to reach the end through the simplest and most direct way.

This is what another engineer, philosopher and genius, Clifford Hugh Douglas, a Scottish engineer, did, when he advised the governments and their advisors of the means to subdue the conditions of production and consumption, instead of submitting these to the rigid conditions of the "sacred cow". 84 years have passed since the Douglas revelation. His suggestions, which are simple and go straight to the point, are known under the name of Social Credit (which is completely apart from political parties bearing this name or any other one).

But professional politicians and highly licensed advisors have rejected and still reject a solution that is "too simple to be good." They preferred to flounder and they still flounder. Nations are suffering from it, social justice is tied up firmly, but the "sacred cow", considered untouchable, remains untouched.

The "Michael" Journal has been denouncing this worship of the sacred cow, and spreading the light of Douglas's Social Credit without interruption, since its foundation, 46 years ago. It will continue to do so. This is working for the service of the truth. This is trying to sweep away from the road the obstacles which prevent the restoration of each person in the exercise of its most fundamental rights.

What about you, officially appointed people to the cause of justice in the world, what do you think of it, what have you got to say?

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