Pope Calls for New Financial Order
“Profit is useful if it serves as a means toward an end,” he wrote in a letter to Catholic bishops worldwide published today. “Once profit becomes the exclusive goal, if it is produced by improper means and without the common good as its ultimate end, it risks destroying wealth and creating poverty.” The 150-page encyclical, the third of his papacy, is titled “Caritas in Veritate” in Latin, or “charity in truth.”
The pope’s reflections on capitalism were two years in the making and publication was held up when the credit crunch crippled the world economy. Benedict said last month the crisis shows “how the economic and financial paradigms that have been dominant in recent years must be rethought.”
The German-born pontiff touched on many themes that will be discussed by the leaders of the largest economies, including “protection of the environment.” He called for a “reform of the United Nations, economic institutions and international finance so the idea of the family of nations can acquire real teeth.”
The pope will have his first meeting with President Barack Obama at the end of the three-day summit, which starts tomorrow in L’Aquila, Italy. He received Japanese Prime Minister Taro Aso at the Vatican today, while Italian Prime Minister Silvio Berlusconi will meet tonight with his Japanese counterpart to discuss the G-8 agenda and the financial crisis.
Benedict, the head of the world’s smallest state, also spoke out in his encyclical on globalization’s benefits and risks.
“The processes of globalization, suitably understood and directed, open up the unprecedented possibility of large-scale redistribution of wealth on a worldwide scale,” he wrote. “If badly directed, however, they can lead to an increase in poverty and inequality, and even trigger a global crisis.”
Italian Finance Minister Giulio Tremonti said on Nov. 20 that the pope was the first to predict the crisis in the global financial system, referring to a “prophecy” in a paper Benedict wrote when he was a cardinal. Cardinal Joseph Ratzinger became Pope Benedict in April 2005.
Money ‘Is Nothing’
Ratzinger in 1985 presented a paper titled “Market Economy and Ethics” at a Rome event dedicated to the Church and the economy. He said a decline in ethics “can actually cause the laws of the market to collapse.”
Pope Benedict has made frequent comments on the economy since the beginning of the financial crisis. In an Oct. 7 speech, he reflected on crashing markets and concluded that “money vanishes, it is nothing,” and warned that “the only solid reality is the word of God.”
The Vatican’s official newspaper, l’Osservatore Romano, on the same day criticized the free-market model for having “grown too much and badly in the past two decades.”
An encyclical is the most authoritative document a pontiff can write. It takes the form of a letter to bishops and is meant to give guidelines from the papacy to the more than one billion Catholics around the world.