We couldn’t believe our eyes when we saw an article just written by Peggy Noonan in TheCatholic World Report. At first it seemed right on-decrying the greed and terrible practices of CEO’s of the last decade which are giving capitalism such a bad name. It turned out, however, to be simply a defense of the system, criticizing a few bad apples who didn’t apply it correctly.
When Noonan declared that none of the thievery, false accounting, corruption and favoritism, etc., would have occurred if only capitalists had listened to guru Michael Novak, super- capitalist and “moralist,” we fell off our chairs. In the years that these horrendous events were taking place, one never heard Michael Novak criticize them.
Novak is an underwriter of Enron capitalism, giving permission to create wealth in any way that the market allows. He gave the greedy all permission in the name of the Church. In his many talks and books he told them wealth creation was a virtue, that the Fathers of the Church were dead wrong when they said avarice was a capital sin. He said CEO’s deserved as much money as they could get because they worked hard and creatively. He even compared the behavior of these corrupt CEO’s to the creative work of God, without any criticism of their approach.
We heard Novak speak to leaders of huge multinationals, those who took advantage of the “privatization” of all in poor countries to buy up electricity and water systems of whole countries (as Enron did in Argentina, for example, to the detriment of the people), and who moved their factories offshore to take advantage of the worst of slave wages. He told them that those workers who received only $.05 to $.50 an hour in their factories under terrible conditions had no right to complain when the CEO’s raked in many millions – that the sin of envy was condemned in the Book of Deuteronomy and those poor workers sinned against God and their wealthy bosses by even mentioning the discrepancies. For Novak the sin was not paying slave wages, but any attempt to moderate the market to allow a living wage.
He told them they didn’t have to worry about the common good. Adam Smith, after all, had said that that idea was too complicated for modern economics-or that modern economics was too complicated to admit such a concept.
Noonan also had the audacity to bring in the Acton Institute and Father Sirico, another advocate of the virtue of wealth creation with similar injustice woven into its logic–which also brings in the negative approach of Calvin to the poor. This “ecumenical” group embraces many Calvinist economists.
There is a serious crisis in the credibility of the Catholic Church because of pedophilia. However terrible the crimes of pedophilia (and they are devastating), we have to note that the victims, while they have suffered very much, are still alive. The premature deaths of the victims of Novakian and Actonian capitalism around the world cannot even be counted–the children who have died of malnutrition and disease all over the world as the CEO’s and their companies have raked in millions.
Catholic neoconservatives have given a “theological” underpinning for the capitalist corruption which has played out in the press in recent months and devastated the stock market. In order to do this, like Enron, WorldCom, etc, they had to work closely with international banks and financial institutions to do it. Where have the criticisms from the advocates of The Spirit of Democratic Capitalism been in regard to the crimes of these banks?
We speak to people each day whose economies have been destroyed by the “structural adjustment” policies (including the requirement to grow food for export instead of for one’s own people and the destruction of local agriculture in favor of enormous agribusinesses) enforced by the World Bank and the International Monetary Fund, and now the World Trade Organization’s rules in favor of rich countries.
The Houston Catholic Worker recently received a book from Hungary, where a Catholic man described the tragedy of his country. Having been exiled to Australia during many years of Communist rule, he was overwhelmed with excitement and anticipation that with the fall of Communism his country would return to faith in God and love and veneration for the Blessed Mother. He was heartbroken to find that when he returned to Hungary, the bankers from the IMF (hand in glove with multinational corporate interests) had gotten there first and destroyed the country. His book, entitled The Robber Banks of Wall Street, shows the catastrophic economic decline which followed the imposition of rules by the IMF. Novak, George Weigel and Fr. Richard Neuhaus gave talks in several countries emerging from Communist domination encouraging exactly the approach which has ruined their economies. They promised that if only their type of “Catholic capitalism” were followed, in the future things would be much better.
Unfortunately, some of the international bankers who enforced the devastating policies on countries all over the world while repeatedly, over and over without any justification raising interest astronomically on loans, were Catholics formed in the Novakian tradition. Some of these men have since realized the errors of the IMF and World Bank and left their employ. The effects of their policies, however, continue to devastate country after country-witness the African nations and Latin America.
Did Peggy Noonan read Novak’s books? At the height of the excesses of the 1990s, he published a small book called On Corporate Governance, and in the ensuing years went from college campus to college campus, especially Catholic universities giving talks with the same title, ostensibly on business “ethics.” In the preface to that book, in what he calls a theology of the corporation, Novak combatively takes on those who want to “humanize” the huge corporations, that “tiny minority of publicly owned firms” which “produce more than half of America’s economic output.” We read this supposed theology and ethics of corporate governance from cover to cover. It was impossible to find even the slightest echo of the Gospel or of the great teachings of the Popes of the last two centuries in the book.
Novak’s presentation of “The Corporation as it Ought to Be” might have been written by Machiavelli. He goes to great lengths to explain why there should be no checks or balances on the power of a CEO. Power is what he most needs to do his job and power he must have: “Executives must be allowed to excecute… They must be propelled to step forward to create wealth.”
Novak responded to questions about the terrible economic discrepancies in our society and in our world in On Corporate Governance in the same way that he does in several other books–by bringing out his oft repeated phrase, the “green worm of envy”: “Envy never travels under its own name; it prefers prettier names, good names to which it has no right: “justice,” “fairness,” and the like.” (p. 25)
Novak has actually written that we have to abandon Catholicism as we know it. “Democratic capitalism calls forth not only a new theology, but a new type of religion” (The Spirit of Democratic Capitalism, American Enterprise Institute, p. 69). This new religion emphasizes wealth creation, which neo-conservatives say the Catholic Church has neglected for so long. Like Novak, George Weigel was writing in 1990 demanding to know what the leadership of the Church was doing “that could be construed as a moral, theological, and spiritual legitimation of efforts to create wealth” (“Camels and Needles, Talents and Treasure: American Catholicism and the Capitalist Ethics,” in Peter Berger, ed.,The Capitalist Spirit: Toward a Religious Ethic of Wealth Creation (ICS Press, 1990).
One wonders to what kind of ethics Noonan is referring when she recommends Novak’s ethical approach as an antidote to Enron, etc., and especially his book The Spirit of Democratic Capitalism. In that book Novak writes that it is “inappropriate” to bring religion to the marketplace in a pluralistic society. Instead of the Bible and the great Papal social Encyclicals, Novak taught economic ethics with Adam Smith’s The Wealth of Nations and Max Weber’s The Protestant Ethic and the Spirit of Capitalism in hand, evangelizing by the promotion of self-interest.
The results might have been predicted.
Houston Catholic Worker, Vol. XXII, No. 5, September-October 2002.
