Catholicism's Developing Social Teaching; R. Sirico, CSP

462 Catholicism's Developing Social Teaching by Robert A. Sirico,CSP T he latter part of the 19th century saw momentous changes brought on by the Industrial Revolution. In an attempt to bring to bear the insights of transcendent faith on real-world matters, Pope Leo XIII, who reigned from 1878to 1903,penned an encyclicalletter that would become known as the Magna Carta of Catholic social teaching. The revolutionary changes Leo witnessed had transformed the social and technological patterns of European life and were the immediate occasion for his letter Rerum Novarum in May 1891.1 Rerum Novarum was the first of the modern social encyclicals. 2 While certain foundational moral teachings are expressed in these documents, much of what they deal with are matters of a con tingent and prudential nature. The student of Catholic social teaching will therefore note that it is dynamic and always sub ject to development. In honor of the centenary of Leo's encyclical, Pope John Paul II declared 1991 a Year of Church Social Teaching and issued a ground-breaking new encyclical, Centesimus Annus (The Hundredth Year), which represents a dramatic development in the encyclical tradi tion in favor of the free economy.

I set out to examine Rerum Novarum with a somewhat focused intention, in order to provide a backdrop for understanding how momentous the appearance of Centesimus Annus is. It is not so much my goal to write here as a theologian, but Paulist Father Robert A. Sirico is president of The Acton Institute for the Study of Religion and Liberty in Grand Rapids, Michigan. Fr. Sirico would like to acknowledge the aid ofhis research assistant, Jeffrey O. Nelson, in the preparation of this essay. rather as a student of what Ludwig von Mises called "the forces that bring society into exis tence," namely the activities of the free market. There \Vill,of course, be a theological dimension to these remarks, and to that extent I write with an awareness of the ecumenical setting of today's religious dialogue, and the desire of all people of goodwillto learn how to build a society that is just, free, and prosperous.

The Role of Encyclicals in OfficialCatholicTeaching Our discussion of Rerum Novarum and Centes imus Annus willbe deepened by an understanding of what it means to speak authoritatively in a Roman Catholic ecclesiastical understanding and what the bounds of that teaching authority, or magisterium, are. The Catholic Church makes the claim that its magisterium carries with it a privileged insight into matters of faith and morals. Nonetheless, the teaching authority itself recognizes certain bound aries to its competence and has outlined, very gen erally, the parameters of that competence. There are times when the boundaries may be obscure and where they may overlap fields outside its immediate mission, but this merely makes the business of interpreting these documents more challenging, it does not vitiate the church's claim for them. An initial distinction to note is that between generally authoritative pronouncements by church leaders and specifically infallible pro nouncements. Catholic understanding in this area is frequently misunderstood by those outside the church, as well as by Catholics themselves.

Church teaching may be exercised in a solemn or extraordinary manner, as when a given doctrine is defined by an ecumenical council of bishops or when pronounced ex cathedra (from the chair) individually by the pope. Distinct from this exer cise is the ordinary teaching of the popes, as in an encyclical.3 Further gradations of the church's teaching authority may be noted: allocutions of popes, the letters and teachings of various Vatican secretari ats and commissions, the homilies of a pope, the teachings of bishops either within their own dio ceses or in national conferences, and the teaching of pastors to their parishioners and catechists to those inquiring into Catholic belief. All of these, and others as well, participate in varying degrees in the church's teaching mission and charism. Our discussion here relates to an encyclical, which is a papal letter circulated throughout the whole of the Catholic Church, and in more recent days, a letter addressed beyond the church to all people of goodwill. As encyclicals, Rerum Nova rum and Centesimus Annus therefore enjoy a rel atively privileged position within the hierarchy of official Catholic teaching.

Two things should be noted: First, as encyclicals, Rerum Novarum and Centesimus Annus make no claim to infallibilityas such. Second, it is necessary to read the documents carefully to discern where Leo and John Paul claim to speak from the very heart and core of church teaching, and where they are attempting to make a practical and prudent application of that core teaching to the day-to-day world. The purpose of this essay is not to examine the function of Catholic dogmatic teaching, but to explore two instances of church teaching dealing with the social realm. The HistoricalBackdropof RerumNovarum The events of the late 18th and the 19th century form the immediate historical context of this encyclical, especially the two great revolutions which defined and marked the era: the French Revolution and the Industrial Revolution. The philosophical backdrop for these revolutions was, of course, the Enlightenment, which spawned the 463 philosophical, religious, political, and economic reflection that formed Continental liberalism.

Freedom from authority was the axiom upon which this liberalism was based, and decades would pass before a distinction between the legit imate and illegitimate exercise of authority would emerge, for example, in the way Lord Acton in the last century and Robert Nisbet in this century would later demarcate power from authority.4 For many Continental liberals, this meant oppo sition to the authority of the dominant religious force: the Roman Catholic Church, in both its moral and its civil manifestations. The French Revolution destroyed the ancien regime, which had determined the course of Western civilization from the early Middle Ages. The result sent shock waves through a church that had long-standing social and political links with the deposed old order. Thus, the French Revolution led to a direct assault on the church's authority, not solely in the spiritual realm; it rebelled against the traditional temporal authority the Catholic Church enjoyed at that time as well.

This last factor, especially the attack on the church's property, is what led Leo into his defense of private property in Rerum Novarum, arguably the most concise and solid defense of the right to private property offered by the magisterium of the Catholic Church until the promulgation of Cen tesimus Annus. The seething anti-clerical hatred generated by the French Revolution, however, caused the church to be very leery of liberal ideas. The history of Catholic social thought in this area might have been very different had the church encountered liberalism in its British, rather than its Continental, manifestation.s In the meantime, Karl Marx had midwifed socialist thought and offered a complete philo sophical analysisof the industrial situation with his own doctrine of economics, anthropology, and eschatology in his attempt to respond to the laissez faire of liberalism. An Analysisof RerumNovarum The principal focus of Rerum Novarum is given in its very title, On the Condition of Workers. To lose sight of this is to sever Leo's thoughts and intentions from their moorings, and to make it dif ficultto understand his essential moral contentions 464 THE FREEMAN • DECEMBER 1991 as well as his prudential suggestions. The result is to blur some essential distinctions, and confuse cause for effect. Sadly, this is much of the history of the interpretation of this document.

It would be impossible in the limited space allot ted to this essay to examine the full thrust and development of the whole of Catholic social teach ing which finds its modern impetus in the promul gation of Rerum Novarum.For our purpose it will be necessary only to examine the document itself and to observe the ground it shares with an essen tially freemarket approach to social organization. This also will enable us to see CentesimusAnnus as an authentic development of Leo's thought. Leo notes at the outset of his work that the great upheavals occurring in his time encompassed both the political and the economic domain (#1)6and he acknowledges that "the problem is difficult to resolve and is not free from dangers." (#4) Socialismoffered itself as the solution for the ills of society; it is no exaggeration to say that in Rerum Novarum Leo looks upon this offer with withering disdain. Of the socialistprogram, he says that it "is so unsuited for terminating the conflict that it actually injures the workers themselves."

(#8) Socialism does this, the pope argues, because it violates the right of people to direct their own lives and to improve their lot, and because it vio lates the right of man "to possess things privately as his own." (#9 and #10) In Defenseof PrivateProperty Leo's defense of private property is rooted in a mode of natural law argument reminiscent of John Locke. After distinguishing human nature from that of animals by virtue of man's faculty of reason, the pope says: Since man expends his mental energy and his bodily strength in procuring the goods of nature, by this very act he appropriates that part of physical nature to hiJI1selfwhich he has cultivat ed. On it he leaves impressed, as it were, a kind of image of his person, so that it must be alto gether just that he should possess that part as his very own and that no one in any way should be permitted to violate his right. (#15) Note the similarity of this argument to that employed by John Locke in his Two Treatisesof Government,written around 1690. In his discus sion of property, Locke says: Though the earth, and all inferior creatures be common to all men, yet every man has a property in his own person. This nobody has any right to but himself. The labour of his body, and the work of his hands, we may say, are properly his. Whatsoever then he removes out of the state that nature hath provided, and left it in, he hath mixed his labour with, and joined to it something that is his own, and thereby makes it his property. It ... hath by this labour something annexed to it, that excludes the com mon right of other men.7 For Leo, as for Locke before him, and as for St.

Thomas before them both,8 the right to private property is not merely some abstract theory; it is, rather, an extension of the rights which find their origin and "reside in individuals," (#18) and are to be enjoyed and safeguarded by the legitimate authority, which exists for this very purpose. Thus, the pontiff concludes, "Private ownership must be preserved inviolate." (#22) Likewise, RerumNovarum renounces any form of coercive egalitarianism and asserts: "There are truly very great and very many natural differences among men. Neither the talents, nor the skill, nor the health, nor the capacities of all are the same, and unequal fortune follows of itself upon the nec essary inequality in respect to these endowments." (#26) In paragraphs 31 and 32 Leo outlines a series of obligations that employers have toward their workers. Although some have interpreted Leo's expressions of concern for workers in an inter ventionist sense, a balanced reading reveals that it not only contains a clear condemnation of socialism, but it attempts to offer concrete ways in which class conflict may be avoided. The pope's pastoral heart is displayed here as he expresses his concern that workers should be given what they are "justly due." He also warns against the use of what he calls "the arts of usury," but this admonition must be read within the context of his discussion of fraud and coercion. Had Leo a clearer understanding of the role the market plays in setting interest rates, he probably would have taken the more benign view of "usury" than his successors did.9 This reference should be read as CATHOLICISM'S DEVELOPING SOCIAL TEACHING 465 a prudential, not a fundamental moral, assertion.

In general, it would be difficult to find in this sec tion anything that would generally offend the moral sensibility of the ethical employer. The encyclicalshifts from an economic perspec tive to aim at what it considers a higher ideal. Here is where the distinction between practical policy suggestions and basic moral premises becomes apparent. The responsibility of the civil order is in part to insure that people act in ways that are just in their economic relations. Leo's use of the term "justice" is derived from its classical,Aristotelian Thomistic meaning: "treatment in accord with desert." Contemporary usage of "justice," on the other hand, seems to offer a blank check for a host of entitlement programs.lO Christianity, however, does not stop with the basic demands of justice. By offering a transcen dent perspective, it calls people to the virtue of love as well. Leo doesn't make the mistake of col lapsing the one into the other. In saying that "no one, certainly,is obliged to assistothers out of what is required for his own necessary use," he is not dis pensing the faithful from their obligation to the poor. He chooses, instead, to make an all too fre quently forgotten distinction: "These are duties, not of justice, except in cases of extreme need, but of Christian charity, which obviously cannot be enforced by legal action." (#36) This section of Rerum Novarum provides an outline of the transcendent vision of the human person contained within Christianity. The accep tance of Christianity can only be achieved by an exercise of free will, hence the living out of this commitment must be performed freely as well. In this regard, Leo moves within the classical liberal tradition in believing that freedom may be suffi cient for a just society, but it is not sufficient for a good one.

Limitsof Law The encyclical also expresses a concern that applies as much today as it did when it was penned a century ago. That concern is the supplanting of the church by the state in the former's ministry to human needs. (#45) Paragraph 53 offers a good example of the con fusion that results from the failure to distinguish between the moral principles in which church teaching is anchored and the prudential suggestions made to implement them. Here Leo is addressing himself to the conditions of workers and their moral and spiritual well-being. He enu merates a number of concerns: strikes, disintegra tion of family life, religious backsliding, "incite ments to sin" by the mixing of the sexes, and overwork. He then concludes that "in all these cases, the power and authority of the law, but of course within certain limits, manifestly ought to be employed." Two things should be noted about this passage.

The first is that the overriding concern is the moral, religious, and physical condition of work ers, not the method chosen to achieve their well being. Second, even when permitting a gov ernmental intervention, Leo is quick to establish a limitation set by reason, and that the law must not go further than necessary to remedy the situation. Paragraphs 61-66contain a complex line of rea soning. The pope argues that free consent is not a sufficient criterion for establishing a "just wage." Free consent, he says, fails to provide enough of the context to establish the morality of the wage offered when the wage is not sufficient for the preservation of life.ll He says, "To preserve one's life is a duty common to all individuals, and to neglect this duty is a crime." There are several aspects of Leo's careful argu ment worth noting. It is apparent that he fails fully to grasp the manner in which wage rates affect the whole of the economy. If the rate of wages is arti ficially high, the cost of the products produced by labor will be increased proportionally throughout the whole economy, placing many of those prod ucts outside the reach of the workers, who are also consumers. It is unfortunate that Leo didn't make the connection between the market wage and pric ing system as the economically most efficient way to insure a living wage for workers. This percep tion, that the "just wage" is best insured by the market wage, is by no means alien to Catholic social thought. 12 Another thing to observe about Leo's argument is the underlying goal in recommending this policy.

Did he want to create a socialist or quasi-socialist society because he believed that socialism was the morally superior economic arrangement? Quite the contrary. His interest in insuring that workers obtain the highest wage possible was that he want ed them to become mini-capitalists by being able 466 THE FREEMAN • DECEMBER 1991 to own and maintain property, to become mem bers of the bourgeoisie. He says: If a worker receives a wage sufficiently large to enable him to provide comfortably for him self [and his family,he willeventually be able to] come into the possession of a little wealth. We have seen, infact, that the whole question under consideration cannot be settled effectually unless it is assumed and established as a princi ple, that the right of private property must be regarded as sacred. (#65, emphasis added) Thus, Leo makes an honest, well-intentioned mistake in a particular economic policy prescrip tion, but not in his overall economic framework.

The latter asserts that private property is a good thing for all people, deriving its legitimacy from natural law; further, it evidences a clear under standing of the dynamic nature of the market and the wayin which protection of the right to property can inspire the poor to productivity and social har mony. (#66) Such economic dynamism can only occur, however, "if private wealth is not drained away by crushing taxes of every kind." (#67) Reaction This reading of Rerum Novarum is not a preva lent one today. It comes from a view of the world as expressed by classical liberals. The contents of the document, however, in my mind, lend them selves to such an analysis and are, in fact, wholly consistent in many ways with the development of classical liberal thought in the 20th century, as well as with the thrust of Pope John Paul Irs Centesimus Annus. Articulating a classically lib eral view of the social crisis is obviously not what Leo had in mind when he wrote his encyclical.

Yet, I would contend that classical liberal thought is at least as much in the tradition of Rerum No varum as is the collectivist interpretation it has historically received. Indeed, the standard interpretation given Rerum Novarum in many circles.has obfuscated much of what is authentically liberal in Catholic social thought. Unfortunately, the interpretations of certain theorists have so dominated discussions on what is the proper Christian response to social, political, and economic calamities or injustices, that any classical liberal interpretation of contemporary injustices is greeted as naive, insensitive, or even heretical. This has had a dampening effect on the dialogue that must exist in Catholic, indeed Christian, quar ters if we are to realize an authentic, informed, and workable moral solution to the social crisisthat we are obliged to address. The dearth of classical liberal religious social theorists, and the hostile opposition they receive in many circles, attests to a kind of intellectual monopoly held by non liberals with regard to "accepted" interpretations of papal documents. Having outlined the ground Rerum Novarum shares with a freemarket approach to social organization, a brief look at the reaction to the document, particularly in America, will serve to show how the present intellectual hegemony developed and entrenched itself.

Rerum Novarum wasn't breaking entirely new ground in addressing the social question. While it was the first papal response, there was a tradition of social thought that preceded and influenced Leo's encyclical. Social thinkers prior to Leo were divided into a number of camps. Some condemned the new eco nomic order while others approved of it. Many study circles and round-table conferences arose in the middle of the 19th century that had an impor tant role in influencing Leo's thought. Of these the Geneva Alliance and the Fribourg Union are representative. Leo paid close attention to these groups and their social analysis of the times. He rejected what he perceived to be the materialism of the new economic order, but wasn't averse to technological progress. He became inter ested in the work of the pioneer of social thought in Germany, Bishop Emmanuel von Ketteler of Mainz, as well as the German economist Lujo Brentano. According to Franz H. Mueller, "Ket teler ... had become more and more convinced of the need of government intervention in social and economic matters, and particularly for protective labor legislation. Brentano ... had insisted that only through unionization could the labor market become truly competitive."13This was a represen tative attitude shared by many church leaders.

The labor conditions faced by many was the principal impetus for much social debate. Rerum Novarum lent its support to various workers' asso ciations or labor unions. The American effort to secure the Vatican's recognition of the Knights of Labor impressed Leo very much. The Knights of CATHOLICISM'S DEVELOPING SOCIAL TEACHING 467 Labor were the immediate forerunners of the American Federation of Labor (A.F.L.). They had come under suspicion in Rome, and were nearly condemned, due to secret initiation rites and dubi ous leadership.14 However, any thought of condemnation evapo rated once these problems were settled to the Vat ican's satisfaction, and especially after Cardinal Gibbons of Baltimore delivered a brilliant memo rial on behalf of the Knights. Leo was generally moved by labor's plight, and he paid close atten tion to the activities of Cardinals such as Gibbons and Henry Edward Manning of England on behalf of labor. Due to their influence and activities Rerum Novarum became the springboard for the burgeoning labor movement in America and Europe.

The Developmentof SocialThought America, like Europe, had a tradition of social thought that preceded Rerum Novarum. To the reformer's mind, Leo's encyclical gave them the support and recognition they needed to carry out their program. Leo deemed profound change to be necessary.Progress was not to be feared. While lib eralism was to be rejected, so too was socialism. Whereas liberalism denied political intervention in the market and in industry's affairs, socialism overemphasized the role the state should play in both community and industrial life. Leo saw laissez faire as the philosophy of the business and political establishment. He saw socialism making inroads into the thought of the masses, threatening to excite envy, encourage unreal expectations, and act as the true opiate of the people. For Leo, private property, rooted in justice and charity,should be the basis by which the welfare of working men and women is secured. No solution to labor's problem could be had without assistance from religion and the church. To Leo's mind, Catholic charity groups would work in defense of those who suffered from horrible living and working conditions until a more prosperous economic base could develop. Such groups would aid the work of both the state and workmen's asso ciations to help relieve poverty.

The task of giving Rerum Novarum its social interpretation was swiftlytaken up by the progres sive left. While Leo advocated, in a measured way, his belief in the importance of securing a "living wage," eliminating Sunday labor, shortening the work day, and prohibiting or regulating the labor of children and women in factories, these points were seized upon by social activists and served as the launching pad for a much broader array of social advocacy and legislation. Those in sympathy with these planks in Leo's encyclical focused almost exclusively on them, too often at the expense of the rest, and great majority, of the encyclical which attempted to restrict the expan sion of the state. An example of this selective interpretation is pointed out by Aaron Abell, himself sympathetic with the left's social analysis, when he notes that after arguing for the proposals contained in Rerum Novarum, these theorists conclude by wanting to "use the taxing power to favor the mul tiplication of property owners."15 The encyclical expressly warned against this. (#47) The social activists, however, believed that in order to improve the admittedly lessthan· desirable state of the laborer, both a public and pri vate effort must be made. In the minds of such activistspublic response was often equated with an increase in the role of the state. Indeed, they saw the role of government as being chiefly concerned with promoting human welfare. Since the working class, in their way of thinking, contributed more than any other group to the prosperity and mate rial well-being of the commonwealth, the state should be active in effecting legislation on their behalf.

American social movements served, in some cases, to give many the notion that private proper ty was a natural right, but it could and should be extensively regulated by the state. According to Abell, "A social view of property ... served as the entering wedge for much contemporary and future American Catholic participation in social reform." Such a view would seem to be contrary to the view expressed by Leo who articulated a view of prop erty rooted in the individual, but which has social dimensions. Many interpreters of Rerum Novarum, howev er, have overemphasized the social view of proper ty. This reflects a bias against individualism and self-interest because of the belief that property owners will inevitably oppress the poor. The bur den for relieving the poor in this view must fall on the state. According to Abell, "these early state 468 THE FREEMAN • DECEMBER 1991 interventionists upheld the right of workers to organize and to engage their employers on the bat tie field of industry, they doubted labor's power, without the aid of the state, to wring justice from entrenched capital."16 According to one priest, the Reverend Edward Priestly,prior to the promulga tion of Leo's encyclicalpeople were coming to the conclusion "that we must, more than we have hith erto done, make over to the state a closer oversight of the relations between classes."17 Hence, during the 1880ssympathy for the labor movement was born in the hearts of nearly all socially concerned Catholics of importance. In addition, a sympathy toward using the apparatus of the state to empower the downtrodden increased. These were, in the words of Cardinal Gibbons, "the most efficacious means, almost the only means" to combat the rise of monopolies and to check their "heartless avarice which, through greed of gain, pitilessly grinds not only the ~en, but even the women and children in various employments.... "18 The hierarchy's enthusiastic support for labor focused public attention on the condition of workers. Two Catholic congresses also were instrumental in fixing this pro-labor sentiment in people's minds. The first was in Baltimore in 1889, two years prior to the promulgation of Rerum Novarum; the second in Chicago in 1893, two years after. They were organized by the hier archy with the aid of prominent laymen, and were aimed at mobilizing clerical and lay persons for "progressive social action." The congresses were well attended and equated capitalist greed with socialism and communism, all of which were denounced.

These congresses presented papers and argued for political, social, and economic change. Many called for increased government intervention, especiallyin the form of taxes on the rich. In addi tion, the congresses voted to set up study groups and distribute the new encyclicalas widely as pos sible. Organized labor wanted to get the analysisof the encyclicalincluded in labor organs and have it be part of addresses before labor audiences. Pro testant advocates who were friendly to the growing notion of "the social gospel" reacted more than a little enthusiastically. They believed that by encouraging the state to get involved in the redress of abuses against labor, the pope had "ranged him self unmistakably on the side of the new Political Economy."19This "new Political Economy" initi ates, in the American context, the march toward an economy of welfarism and interventionism. The American Economic Association was equally enthusiastic about the new encyclical.

While most economists didn't agree with the whole of it, none could deny its monumental importance. Argument ensued after the promul gation of the encyclical over the single tax iss~e. Henry George saw in it a repudiation of his pro gram. He sent an open letter to the pope attempt ing to explain that under his plan only rent would be transformed into common property. Michael A. Corrigan, the archbishop of New York,forced sup porters of George in his diocese to make public disclaimers. Catholic laymen rushed to George's defense and argued that what was included in the encyclical regarding public policy was not infalli ble. Cardinal Gibbons, among others, argued that supporters of the single tax should be allowed to judge the efficacy of George's proposal as they would be allowed to do with any other public pro posal. Archbishop Corrigan was corrected by Rome, givingall progressive-minded Catholics the freedom to pursue public policy proposals without church interference. Theoretically, all public policy proposals were acceptable as long as they weren't contrary to the faith and moral teaching of the church.

The Rootsof the SocialJusticeMovement This new freedom acknowledged by the Vatican finally established the new movement for social justice. In 1899 the Reverend Thomas J. Ducey argued that the church should now lead the people to emancipation from "social and economic slav ery" imposed on them by "trust kings and kings of monopoly.... "20 However, according to Abell, the social movement never really got off the ground during the decade and a half followingthe promul gation of the encyclical. Abell attributes this to racial dissension that caused division and deep dis unity among Catholics, a reference to the waves of immigration that swept the country in the last half of the 19th and early part of the 20th century. The newer immigrants ran up against the older and more established immigrants who were less sympathetic to their condition, and who felt threatened by the competition for jobs they repCATHOLICISM'S DEVELOPING SOCIAL TEACHING 469 resented. The new arrivals, after 1900,from cen tral and eastern Europe, were often accused of being involved in socialist causes. The Socialist Party, headed by Eugene Debs, was making inroads in all parts of American· society. The period between 1912and the beginning of World War I was the time of its greatest appeal. In 1912 the American Federation of Labor was one-third socialist. The Industrial Workers of the World (1.W.W) offered the more radical trade unionists an outlet until the war, while many Catholic priests and laity became involved in the increas ingly active socialist movement.

The American hierarchy repeatedly censured socialismas being materialistic, justifyingthis posi tion by citing Leo's condemnation of socialism in Rerum Novarum.Social activists in return argued that these condemnations by the hierarchy were "exaggerated," that they even "misinterpreted" Leo's attitude toward socialism. In addition, they "ignored its positive program for Christian social reform. "21 Despite protests from the hierarchy, socialists were making considerable inroads into the Catholic community. FatherJohnRyanand "Semi-Socialism" Around 1905the hierarchy began to articulate a program that would keep those Catholics who were attracted to socialism within the church. Their goal was to head off the burgeoning alliance between Catholic workers and socialists. Catholic social activists and theorists developed a strategy to construct progressive economic reform around what they deemed to be "the really salient pas sages" of RerumNovarum.22 This, of course, often meant those that favored interventionism and wel farism to the exclusion of those that warned against such policies. The new reformers argued that socialism contained in itself seeds of Catholic truth which the socialists had stolen and which Catholic social theorists should now reclaim.

Leading this new approach was Father John A. Ryan- "the foremost academician of the Ameri can Catholic social movement."23 Ryan's first book, A LivingWage,was published in 1906and advocated a minimum wage for all. He extended his argument by callingfor other reforms and interventions in subsequent books and arti cles.Among these reforms were "indirect methods of augmenting the worker's income through leg islative action; [including] the eight-hour day; restriction on the labor of women and children; legalization of picketing, persuasion and boy cotting; conciliation and arbitration by state and national boards with compulsory powers; and relief of unemployment by state employment bureaus, labor colonies and social insurance. Like wise provisions should be made against accidents, illness and old age. Finally,the state should launch a housing program, not only condemning and pre venting unsanitary housing and congestion, but erecting decent habitations for the poorer classes, to be rented or sold-preferably sold-on easy conditions."24Ryan also advocated public owner ship of natural monopolies, progressive income and inheritance taxation, taxation on future increases in land values, and prohibition of specu lation on the exchanges.

Ryan understood that socialism tended to destroy the faith of those involved. In that respect he thought it should be condemned. However, he felt that the economic aspect of socialism could be salvaged from its negative religious aspects. Hence, he called hisprogram "Essential Economic Socialism" or "Semi-Socialism," and he believed this didn't fall under church condemnation. He believed that he was complying most faithfully with Leo's desire that the "rights and opportunities of private ownership be sufficiently extensive to safeguard individual and social welfare."25 Ryan maintained that socialismcould best safeguard pri vate ownership with regard to the goods of con sumption, and that it would only be necessary to convert the means of production, and not all con sumer goods, into common property. Ryan believed that economic socialism was not only in the best tradition of Leo, but that its pro motion was good strategy. He felt that if reformers concentrated on refuting the negative religious assumptions of the secular socialist movement, while at the same time arguing in favor of its eco nomic precepts, then Catholics would be lesslikely to get involved in the socialist movement as it was expressing itself politically-seeing the church as a champion of the kind of social reform the masses were demanding.

After 1908 a widespread Catholic movement for social reform began with Ryan as its leader. The first important group to champion social reform was the German Catholic Central Verein.

470 THE FREEMAN • DECEMBER 1991 In 1908 they began with 125,000members and establisheda Central Bureau for the Promotion of SocialEducation and founded a magazine called the Central-Blatt and Social Justice. In 1909 the Central Vereinhad a conventionwhichcalled for more progressive labor legislation. The Verein worked tirelesslyto promote socialeducation and the labor movement. It also sponsored scholar shipsfor the studyofsocialproblemsas they exist ed in Germany.It set up summerschoolsfor social studyin 1912at SpringBank,Wisconsin,and Ford ham University,and lobbied for a Catholicschool of social science to be established. Ryan was encouragedby this blossomingeducationalmove ment and predicted that within a decade it would produce an army of men "able to justifyCatholic oppositionto both the abusesofcapitalismand the excesses of Socialism" with "the ability and the courage to defend plans of positive social reform."26 CatholicSupportfor the LaborMovement The 1909Vereinconventionalsocalledfor sup port of the labor movement.It advocated faithful cooperationwithgroupslikethe AmericanFeder ation of Labor,the National CivicFederation, and the American Associationfor Labor Legislation.

The Vereininfluencewas feltnot onlyamongGer mans; its program was adopted by nearly all Catholics.Thiswaslargelydue to the effortsof the Reverend Peter E. Dietz of New York, one of its most persistent members. Abell says that "just as John A. Ryan was the academician, so Peter E. Dietz was the organizer,of the AmericanCatholic socialmovement."27 In 1909 Dietz attended the convention of the American Federation of Labor in Toronto. He believed Catholicsweren't doing as good a job as the Protestant denominationsin officiallysupport ing the delegation,so he got himselfappointed as a delegate to the 1910 convention, establishinga permanent Catholic delegate position at A.F.L. conventionsin the process,and in a speech to the delegates assured them of Catholic support for trade unionism. During the convention he brought Catholic trade unionrepresentativestogether and formeda permanent organization called the Militia of Christfor SocialService.The Militia'spurposewas to promote understanding of the church's social program and the causeof labor.Its labor program exhibiteda vastinfluenceimmediately,and in 1911 the American Federation of Catholic Societies formed a SocialService Commissionto promote labor'scause.The new SocialServiceCommission systematically circulated Leo's encyclical to be studied and applied with an interventionist slant.

The SocialServiceCommissionwas essentiallyan enlarged Militiaof Christ.These groupscalledfor education and pressed for the establishment of schools,as well as inclusionof socialsciencestudy into the curriculum. These college graduates and professionals formed the Eunomic League ("well-Iawed league") to discuss social problems, and several lecture courses were adopted to reflect the new concerns, the ones at Loyola-Chicagoand Ford ham being the most important. Some seminaries, in additionto The CatholicUniversityofAmerica, placed social studies in their regular curricula. Withthe successfullaunchingof these educational programs, the pre-war Catholic social movement cameto an end. However,thiswasthe mostcritical and important timein the historyof Catholicsocial thought to date. Much has merely been addition, re-definition, and extension of the programs begun during this period. Followingthe war the organizedsocialistmove ment began to disintegrate, and economic prob lems arose which the American Federation of Catholic Societies lacked the ability to address.

The hierarchy formed the National CatholicWar Councilin 1917to deal withpost-warsocialrecon struction.28 Though it condemned socialismin a couple of places, it picked up where pre-war thought left off. In 1919the War Council'sAdmin istrative Committee issued what has been called the Bishops' Program of Social Reconstruction. The statement wasprepared byJohn A. Ryan,and it advocatedsuchremediesfor the country'ssocial ills as: social insurance against unemployment, sick ness,invalidity,and old age;a federalchildlabor law; legal enforcement of labor's right to orga nize; public housing for the working classes; progressive taxation of inheritances, incomes, and excessprofits;stringentregulationofpublic utilities rates; government competition with monopolies ... ; worker participation in manCATHOLICISM'S DEVELOPING SOCIAL TEACHING 471 agement; and cooperative productive societies and co-partnership arrangements in order to enable the majority of wage earners to "become owners ... of the instruments of production. "29 It was with good reason that Ryan would come to be called the "Right Reverend New Dealer."

The bishops changed the name of the Council in 1922 to the National Catholic Welfare Council, and it is today known as the National Conference of Catholic Bishops. They also created a social action arm called the Department of Social Action which was charged with the task of seeing that the Bishops' program was realized. With that, Abell argues, the "reception of Leo XIII's labor encycli cal was complete. "30 The Catholic social movement has continued from that time essentially to argue the same points and advocate the same political and economic agenda. The names, councils, and circumstances have changed, but from Pius XI to John Paul II the social movement has retained its character. The context in which this agenda has been framed, of course, has changed with the passing of time. According to G. J. Hebert, "Social changes during the period after WW II were naturally reflected in Catholic social movements. Special ization and organization became more and more characteristic of Catholic as well as other efforts.

As the role of organized labor in American society was stabilized ... , the labor movement was less prominent than formally as a battleground for social justice.... "31 More than labor, today's liberationist and envi ronmentalist movements are the means by which the Christian left wages its battles for "social jus tice." Indeed, if they have moved in any direction it has been farther to the left as the left-wing Catholic scholar Gregory Baum has recently argued.32 A DramaticDevelopment The latest installment in Catholic social teach ing, and arguably its most dramatic development, comes in Pope John Paul II's Centesimus Annus, which commemorates Leo's encyclical.It may well represent a shift away from centralized planning within the Catholic tradition, and a reversal of the left-wing trend outlined in the previous pages,33 More than any other church document, this latest one celebrates the creativity of entrepreneurs and the virtues required for productivity. John Paul describes these virtues as: "diligence, indus triousness, prudence in taking reasonable risks, reliability and fidelity in interpersonal relation ships, as well as courage in carrying out decisions which are difficult and painful but necessary, both for the overall working of a business and in meet ing possible setbacks." (#32) The pope affirms both the practical and moral legitimacy of profit, entrepreneurship, appropri ate self-interest, productivity, and a stable cur rency. He endorses the right to private property along with its social dimension and callsit a human right. And he distinguishes consumerism from the business economy.

Nowhere does the Holy Father imply that socialism and capitalism are morally equal, a sen timent some detected in his 1987social encyclical, Sollicitudo Rei Socialis. This very deliberate move on the pope's part comes as a surprise to those who anticipated that, having been a principal player in the events that buried collectivism in 1989, John Paul would now employ the considerable prestige and power of his moral authority to anathematize the economic system of free exchange. Instead, John Paul encourages such a system, as long as it is rooted in legal, ethical, and religious traditions. Beyond seeing no contradiction between virtue and freedom (a word frequently employed in his letter), the pope expresses deep reservations throughout the document about various forms of state economic interventions. In this regard, the pope's letter strikes a consid erably different tone from that of the U.S. bishops in their 1986 statement on the U.S. economy, "Economic Justice for All." The latter repeatedly called for increasing the role of the government to remedy social problems and was seen by many business leaders and economists as a moral sanc tion for the redistributivist state.

The pope, on the other hand, having seen the deleterious impact of governmental encroach ments in Eastern European countries, questions the legitimacy of extensive intervention by the welfare state, or what he callsthe "social assistance state." John Paul says, "By intervening directly and depriving society of its responsibility the social assistance state leads to a loss of human energies and an inordinate increase of public agencies, which are more dominated by bureaucratic ways 472 THE FREEMAN -DECEMBER 1991 of thinking than by concern for serving their clients, and which are accompanied by an enor mous increase in spending." (#48) At the beginning of his pontificate some theolo gians thought that John Paul, having lived in a Marxist society, would approach social and eco nomic questions with a certain sensitivity and sym- . pathy to Marxist insights. What appeared to some commentators 34 on his first social encyclical, Laborum Exercens, as a turn to dialogue with Marxists, has ended up being not only a repudia tion of the entire collectivist agenda, root and branch, but the warmest embrace of the free econ omy since the Scholastics.

Centesimus Annus represents an authentic development in the encyclical tradition at the same time that it constitutes a retrieval of the for gotten private property tradition of the Scholas tics, most notably the School of Salamanca in the mid-16th century. This school of thought asserted that what Christianity says about private property is exactly what it says about the whole material order: It is good, but relative. Only God is abso lute.35 To grasp the authentic significance of Centes imus Annus requires a blend of two approaches. First, read it on its own merits. As objectively as possible, one can exegete its various passages to discern its thrust and priorities on the basis of the text of the encyclical itself. Then, read the· docu ment in context of the previous social pronounce ments by the Catholic teaching office over the past 100 years, and see what new themes, develop ments, and directions the present one initiates.

When read for itself,CentesimusAnnus emerges as an uncompromising rejection of collectivism in its Marxist,Communist, socialist,and even welfare statist manifestations. While the encyclical allows for a certain amount of intervention by the state in such areas as wage levels, social security, unem ployment insurance, and the like, Centesimus Annus expresses repeated concern for observing the principle of subsidiarity (first tending to human needs on the local level), and warns against the effects of intervention both on the economic pros perity of a nation and on the dignity and rights of each person. Centesimus Annus, then, indicates a decided preference for what it calls the "business econo my," "market economy," or "free economy," root ed in a legal, ethical, and religious framework. wo ~ C/) ~z o:::io ~o Pope John Paul II. In his encyclicalCentesimus Annus, the pope afflrmsboth the practicaland moral legitimacy of profit, entrepreneurship,appropriateself-interest,pro ductivity,anda stablecurrency.

While it rejects the notion that such a free econom ic system meets all human needs, it distinguishes the economic system from the ethical and cultural context in which it exists. In this way Centesimus Annus can criticize the excesses of materialism and consumerism and still endorse capitalism as being essentially in accord with Christianity. A second way of reading this encyclical reveals it as an even more dramatic document. When read with an awareness of modern Catholic social thought, beginning with Leo XIII's Rerum Novarum, its historical import surfaces. Centes imus Annus evidences the greatest depth of economic understanding and the most deliberate (and least critical) embrace of the system of free exchange on the part of Catholic teaching author ity in .100 years, and possibly since the Middle Ages, as noted previously. Moreover, it contains a modern appreciation for the dynamic nature of free exchange and the way in which wealth is produced.

When seen in this way, CentesimusAnnus rep resents the beginnings of a shift away from the static, zero-sum economic world view that led the church to be suspicious of capitalism and to argue for wealth distribution as the only moral response to poverty.

CATHOLICISM'S DEVELOPING SOCIAL TEACHING 473 There are several implications of this new direction worth considering. As already noted, there is the clear difference in thrust and direction apparent when Centesimus Annus is read along side the 1986 U.S. bishops' letter, "Economic Jus tice for All." This has left the socialjustice estab lishment unprepared to consider social questions from within the framework John Paul has con structed in Centesimus Annus. When one reads over the material these ecclesiastical cognoscenti have produced, it becomes evident that they are unfamiliar with the Continental economic tradi tion represented by Wilhelm Roepke, Ludwig von Mises, E A. Hayek, Israel Kirzner, as well as the insights of the Virginia public choice school and others. A further implication of this encyclical is that entrepreneurs and capitalists have been invited in out of the moral cold to which they felt exiled in the past. The Holy Father has affirmed their basic vocation and role, even while he challenges them to look beyond the economic bottom line and con sider the moral aspects of their work.

A third implication is that this encyclicalconsti tutes the epitaph for liberation and collectivist movements in terms of any official ecclesiastical legitimacy. The "Christian-Marxist dialogue" is dead, as even Gustavo Gutierrez, father of libera tion theology, has recently conceded. Centesimus Annus indicates a turn toward authentic human liberty as a principle for social organization on the part of the world's largest Christian church. Thus a new dialogue has begun. This latest encyclical will go down in history alongside Vatican II's DignitatisHumanae, on reli gious liberty,as representing the impact the Amer ican experiment has had on the teaching of the uni versal church. What Dignitatis Humanae did to open the church to the rights of conscience and religious liberty, Centesimus Annus willdo to open the church to a full and vigorous dialogue with the idea of economic liberty. It is an idea that began . with Catholic scholarship as seen in the Scholas tics; it is fitting that it should be retrieved by this pope.

Conclusion The hegemony of the left in social matters has, over the years, had an increasingly deleterious effect on the traditionally progressive and effective social mission of the church, and may only now be coming to an end. But it is crucial to understand that the reason for this is a fundamen tal misconception on the part of these thinkers regarding the context necessary for economic progress. It has been argued elsewhere that the progressive ideals of the left were co-opted by agents of reaction in an attempt to maintain cen tralized control.36 So my objection here is not so much to the goals of the social reformers (e.g., liv ing wages, decent working conditions, available health care), as much as it is with the programs advocated to achieve these goals. The time has come for more dialogue between free market and socialist theorists within the reli gious community. Some understanding and con sensus must be reached if our goal of "liberating"

the poor from the shackles of poverty and injustice is to be authentically accomplished. There are encouraging signs that these inroads are finally being made. Especially seen in the light of the collapse of the command economies in Eastern Europe, the program of the "progressives" has become some what stale, and is increasingly viewed as restrict ing economic progress and political freedom in many ways. Too often the old policy proposals first articulated by John A. Ryan are retooled and put forth today as viable solutions to economic and political oppression. At times it almost appears that the events-political, economic, and social-of the past 100years, which have exposed the ineffectiveness of much of this social pro gram, had not occurred. Ronald Nash, an evangelical Christian philoso pher, points to a simple fact that should be kept in mind by all Christian social theorists: "Compas sion and love must be coupled with a careful grounding in the relevant philosophical, economic, political and social issues. If the ... social activist proceeds in ignorance of the accepted tools of eco nomic analysis,he risks turning bad situations into something far worse."37 RerumNovarumis not without certain miscon ceptions relative to the practice of the free econo my. Pope Leo appeared concerned that if the government doesn't exercise some control over economic transactions, the "powerful" will take over and abuse the weak. When Leo saw the activ ities of businessmen like J. ~ Morgan, using the coercive power of the state to achieve and main474 THE FREEMAN • DECEMBER 1991 tain monopolies, he reacted against such abuses by calling for interventions that he hoped would insure the widest possible distribution of private property. He failed to see that a freely operating market would act as the best insurance to achieve this goal, but this was a mistake in economic anal ysis, not a mistake in moral principles. It may be said that the economic analysis has been updated in John Paul's Centesimus Annus.

Where Rerum Novarum exhibits a concern that society be organized in such a way that a vibrant network of what we today would call mediating institutions be active in protecting and promoting the welfare of the commonweal, Cen tesimus Annus explicitly calls for such "interme diate communities" to be left free to extend their positive social impact. (#48 and #49) Taken as a whole, and read in the context of its historical set ting, Rerum Novarum provides one of the most finely honed defenses of the free market and pri vate property order in the annals of Catholic, indeed Christian, social thought up until the appearance of Centesimus Annus, which expands Leo's notion of property beyond land ownership, to include "the possession of know-how, technol ogy and skill." (#32) Both Rerum Novarum and Centesimus Annus are worthy of celebration by those who believe that individual liberty offers the best hope for the common good; and they are worthy of study by religious collectivists who mistakenly believe that religion in general, and Christianity in particular, ought to opt for socialism. D 1. Literally translated Rerum Novarum means "of new things,"

although the general title of the encyclicalactuallyis given as "On the Condition of Workers," or as the renowned Thomist Etienne Gilsonmore accuratelyentitledit,"The Rightsand DutiesofCapital and Labor." 2. Rerum Novarum would be followedby QuadragesimoAnno in 1931,Pius XII's Pentecost Radio Address (1941),Materet Magis tra (1961), Pacem in Terris (1963), Gaudium et Spes (1965), Dig natatisHumanae(1965),PopulorumProgressio(1967),Octogesima Adveniens (1971), Laborum Exercens (1981), Sollicitudo Rei Socialis (1987),and CentesimusAnnus (1991). 3. Francis A. Sullivan, Magisterium:TeachingAuthority in the CatholicChurch(New York: PaulistPress, 1983).Father Sullivan,a professor of ecclesiologyat the pontifical Gregorian University in Rome, providesa balancedand extensiveoverviewof the role of the teachingofficeof the Church. 4. See Robert Nisbet, The Questfor Community:A Study in the Ethicsand OrderofFreedom(SanFrancisco:ICS Press,1990),where he says: "By authority, I do not mean power. Power, I conceive as something external and based upon force. Authority, on the other hand,is rooted in the statutes,functions,and allegianceswhichare the componentsof any association.Authorityis indeedindistinguishable from organization,and perhaps the chiefmeans by which organiza tion,and a senseof organization,becomespart ofhumanpersonality.

Authority,like power,is a form of constraint, but, unlike power,is basedultimatelyuponconsentofthoseunderit;that is,it is condition al. Power arisesonlywhen authoritybreaks down."(p. xxvi) 5. A. M. C. Waterman,"ChristianPoliticalEconomy:Malthusto Thatcher," Religion, Economicsand Social Thought,Walter Block and Irving Hexham, eds. (Vancouver,B.c.: The Fraser Institute, 1986);also see MichaelNovak'sexcellentdiscussionof John Stuart Millin chapter 5of FreedomWithJustice(SanFrancisco:Harper and Row, 1986),pp. 81-107and IrvingKristol'sReflectionsofa Neocon servative(New York: Basic Books, 1983), particularly chapter 12, "Adam Smithand the Spiritof Capitalism,"pp. 139-76. 6. Throughout thisarticleparentheticalreferencesto specificsec tionsin RerumNovarumand CentesimusAnnus followthe citations. 7. John Locke, Second Treatiseof Government,paragraph 27. It shouldbe noted that there is a debate as to whether Leo's use of the Lockeanargumentis a repudiationofthe previousCatholictradition on private property or a developmentand expansionof it.

8. Thomas Aquinas, Summa Theologica,II-II, q.6, a.2: "A man wouldnot act unlawfullyif by goingbeforehand to the play he pre pared the way for others: but he acts unlawfullyif by so doing hin ders others from going.... A rich man does not act unlawfullyif he anticipates someone in taking possession of something which at first was common property [i.e.,existingin a state of nature], and gives others.a share: but he sins if he excludes others indiscrimi nately from usingit." 9. See J. T. Noonan, The ScholasticAnalysis of Usury (Cam bridge,Mass.:Harvard UniversityPress,1957). 10. F. A. Hayek, The Constitutionof Liberty(Chicago:The Uni versityof ChicagoPress,1960),pp. 93, 99-100,231-32. 11.The pope divideswhathe callsthe "personal" dimensionfrom the "necessary"dimensionofthe wage rate question.By "personal" he means what a worker and an employeragree upon as a wage;by "necessary"he meansawagesufficientto enable aworkerto acquire life'snecessities.

12. See Alejandro Chafuen, Christiansfor Freedom (San Fran cisco:IgnatiusPress,1986),pp. 180-86. 13. FranzH. Mueller,The ChurchandtheSocialQuestion(Wash ington,D.C.:American Enterprise Institute, 1984),p. 73. 14. Brother William J. Keifer, SM, Leo XIII: A Light From Heaven(Milwaukee:Bruce PublishingCompany,1961),pp.146-49. 15. Aaron I. Abell, "The Receptionof Leo XIII's Labor Encycli calin America,1891-1919,"Reviewof Politics,vol.vii,October 1945, p.466. 16. Ibid.,p. 471. 17. Ibid.,p. 472. 18. Ibid. 19. Ibid.,p. 476. 20. Ibid. 21. Ibid.,p. 481. 22. Ibid.,p. 493. 23. Ibid.,p. 483. 24. Ibid.,p. 484. 25. quoted in Abell,p. 484. 26. Abell,pp. 486-87. 27. Ibid.,p. 488. 28. For an interestinghistory of this period see John B. Sheerin, CSp' Never Look Back: The Careerand ConcernsofJohn J. Burke (New York: Paulist Press, 1975). Burke was the founder of the National CatholicWar Council. 29. Abell, p. 494.

30. Ibid. 31. G. J. Hebert, "Social Movements, Catholic," New Catholic Encyclopedia,vol. 13, p. 331. 32. Gregory Baum,"Recent CatholicSocialTeaching:A Shiftto the Left," Religion,Economicsand Social Thought, Walter Block and IrvingHexham, eds.,pp. 47-70. 33. This section is drawn from my articles in NationalCatholic Reporter,May 24, 1991,p. 6, and in NationalReview,June 23, 1991, pp. S9-S1O. 34. See Gregory Baum, The Priority of Labor (New Jersey: PaulistPress,1982). 35. For a fine analysisof the late Scholastics,see Alejandro A. Chafuen. 36. See Don Lavoie,NationalEconomicPlanning:WhatIs Left? (Cambridge,Mass.:BallingerPublishingCompany,1985). 37. Ronald H. Nash,SocialJusticeandthe ChristianChurch(Mil ford, Mich.:Mott Media,1983),p. 2.