Impoverished notion of economics at core of worldwide financial breakdown, explains Pontiff

Vatican City, Apr 30, 2010 / 10:52 am

The global economic crisis has shown not only the fragility of the system but also the flawed assumption that the market is capable of correcting itself, said the Pope on Friday. He added that economic questions should always maintain an appreciation for the human dimension.

Pope Benedict XVI spoke with participants in the 16th Plenary Session of the Pontifical Academy of Social Sciences to inaugurate their five-day conference themed, "Crisis in a Global Economy. Re-planning the Journey."

Observing that "the worldwide financial breakdown has ... demonstrated the fragility of the present economic system and the institutions linked to it," the Holy Father explained that the crisis "has also shown the error of the assumption that the market is capable of regulating itself, apart from public intervention and the support of internalized moral standards."

At the root of this assumption, he continued, is "an impoverished notion of economic life as a sort of self-calibrating mechanism driven by self-interest and profit-seeking."

Within this perspective, "the essentially ethical nature of economics as an activity of and for human beings" is overlooked.

"Rather than a spiral of production and consumption in view of narrowly-defined human needs, economic life should properly be seen as an exercise of human responsibility, intrinsically oriented towards the promotion of the dignity of the person, the pursuit of the common good and the integral development – political, cultural and spiritual – of individuals, families and societies."

The Pope went on to say that "an appreciation of this fuller human dimension calls, in turn, for precisely the kind of cross-disciplinary research and reflection which the present session of the Academy has now undertaken."

Among the principles involved in the "re-planning of the journey," he said, there must be a place for "the promotion of the common good, grounded in respect for the dignity of the human person and acknowledged as the primary goal of production and trade systems, political institutions and social welfare."

It is important, he added in conclusion, that "economic decisions and policies must be directed towards 'charity in truth' ... For without truth, without trust and love for what is true, there is no social conscience and responsibility, and social action ends up serving private interests and the logic of power, resulting in social fragmentation."