Church Teaching on Unions

[Abu]

Tommcguire, #177
“free enterprise” does exist for large uncontrolled multinationals.

The reality is NOT “free enterprise”, which is the natural economic laws of cause and effect discovered and developed by the Catholic Late Scholastics, but the unregulated fantasy postulated as “free enterprise”, as against the perverse wealth destroying federal policies.

The “uncontrolled” and “unregulated” assumption occurs when governments fail to enact sensible laws to seek and punish those who steal, cheat, swindle, and to promote competition.

(#180) The price of goods is also used as a means of fair and unfair competition. Those with great financial resources can lower prices to the extent that smaller less well financed businesses are run out of business. Then the well financed can control the prices… and this is especially true in the food industry.

The fact that this may occur may or may not be good – consumers benefit from lower prices and there are economies of scale which small businesses may not enjoy. If large companies are allowed to control too large a market share, laws to promote competition may be non-existent or faulty. Often it may be imports which flood the market at low prices which other countries manipulate through exchange rates. There are controls available to counter such a strategy.

If a business does not offer what the buyers of the goods or services need or want at a competitive price in a free society, then that business has failed the objective through which profits depend.

I do not accept that economic problems are simple….(No one has a right to what he or she does not need when others lack the necessities of life.)

The economic laws of cause and effect are part of the natural law – people act morally or immorally. As societies worldwide have been affected adversely by neglect of the natural moral law, neglect of economic laws cannot improve that situation either.

Helping those in need involves the principles of solidarity and subsidiarity

No amount of falsehoods should mislead those who really want to understand the social teaching of Christ’s Church and to encourage the right use of entrepreneurship, capital and labour. John Paul II’s 1993 encyclical on moral principles The Splendor of Truth (Veritatis Splendor), #100, 101, argues that it is only by recovering the Christian view of human freedom as the power to do what is morally right, that free institutions such as democracy and market economics can be kept on the right path.

“If I were to pronounce on any single matter of a prevailing economic problem, I should be interfering with the freedom of men to work out their own affairs. Certain cases must be solved in the domain of facts, case by case as they occur…[M]en must realise in deeds those things, the principles of which have been placed beyond dispute…[T]hese things one must leave to the solution of time and experience.” [Pope Leo XIII. Quoted in *The Church And The Market, Dr Thomas E. Woods, Lexington Books, 2005, p 4].

Pius XI wrote of “matters of technique for which [the Church] is neither suitably equipped nor endowed by office.” Quadragesimo Anno, 1931, 41]….“economics and moral science employs each its own principles in its own sphere.” [QA, 42]

 

[tommcguire]

I am not as informed about history and philosophy as some, but I cannot accept that cause and effect are that clear. In my experience, what is claimed to be a cause is not, and the effect is often not clear as claimed. There are so many factors that bring about an effect.

On this thread many would have unions done away along with their collective bargaining. It is not at all clear to me the unions and collective bargaining are the cause of all the evils that are claimed. In fact, there may be some arguments for the good unions and collective bargaining have done for the most vulnerable in our society.

What seems central to Catholic Social Doctrine is the Common Good, which includes the principle of universal destination of created goods. Most Catholics do not have a clue what this principle means; it is probably the most ignored principle in Catholic Teaching. Without government intervention that says no to some “free enterprise” practices, there would be no way to give any kind of preferential option to the poor. Greed dominates, no human can change another human being, that is the work of the Holy Spirit. Humans can change institutions and that is necessary to make unions more responsive to the needs of the most vulnerable.

 

[Abu]

tommcguire
In fact, there may be some arguments for the good unions and collective bargaining have done for the most vulnerable in our society.
Without government intervention that says no to some “free enterprise” practices, there would be no way to give any kind of preferential option to the poor. Greed dominates, no human can change another human being, that is the work of the Holy Spirit.

There can be no question that free human organizations such as trade unions are part of Catholic social teaching. What occurs are real practices by real people – good and bad practices. While communism and socialism are intrinsically bad for the common good, the free market with sensible laws for the common good is what Blessed John Paul II recognises as the answer.

CCC2425: She has likewise refused to accept, in the practice of “capitalism,” individualism and the absolute primacy of the law of the marketplace over human labor.

Notice the acceptance of “the practice of ‘capitalism’ ” but which must exclude “individualism and the absolute primacy of the law of the marketplace over human labor” which is why She insists on subsidiarity, and free associations, including trade unions, and the government role to guarantee and enforce clear rules that establish and protect the ownership of private property and enforce contract, as well as punish people who take what is not theirs. The Law – transparent, providing equal justice, and impartially administered – is as important an institution to civilised society as the free market, which itself could be described as a mechanism for communicating prices.

Centesimus Annus, Blessed John Paul II, 1991:
#19: “In general, such attempts endeavour to preserve free market mechanisms, ensuring, by means of a stable currency and the harmony of social relations, the conditions for steady and healthy economic growth in which people through their own work can build a better future for themselves and their families. At the same time, these attempts try to avoid making market mechanisms the only point of reference for social life, and they tend to subject them to public control which upholds the principle of the common destination of material goods. In this context, an abundance of work opportunities, a solid system of social security and professional training, the freedom to join trade unions and the effective action of unions, the assistance provided in cases of unemployment, the opportunities for democratic participation in the life of society — all these are meant to deliver work from the mere condition of “a commodity”, and to guarantee its dignity.
#32: “His intelligence enables him to discover the earth’s productive potential and the many different ways in which human needs can be satisfied.
#34: “It would appear that, on the level of individual nations and of international relations, the free market is the most efficient instrument for utilizing resources and effectively responding to needs……But there are many human needs which find no place on the market.”
#42: “If by “capitalism” is meant an economic system which recognizes the fundamental and positive role of business, the market, private property and the resulting responsibility for the means of production, as well as free human creativity in the economic sector, then the answer is certainly in the affirmative, even though it would perhaps be more appropriate to speak of a “business economy”, “market economy” or simply “free economy”.
#48. “These general observations also apply to the role of the State in the economic sector. Economic activity, especially the activity of a market economy, cannot be conducted in an institutional, juridical or political vacuum. On the contrary, it presupposes sure guarantees of individual freedom and private property, as well as a stable currency and efficient public services. Hence the principle task of the State is to guarantee this security, so that those who work and produce can enjoy the fruits of their labours and thus feel encouraged to work efficiently and honestly. The absence of stability, together with the corruption of public officials and the spread of improper sources of growing rich and of easy profits deriving from illegal or purely speculative activities, constitutes one of the chief obstacles to development and to the economic order."

 

[MarkInOregon]

Because you are pre-occupied with trade unions you appear to fail to appreciate any economic fundamentals in the natural laws of cause and effect. The envy and disgust conveyed in your diatribe does nothing to solve anything. The “reality” of want which you portray, just like your example of the lady who could not pay for petrol, fails to convey or understand WHY. I am not sure he pre-occupied with trade unions is a fair or accurate characterization it seems to me that he has felt a need to advocate for them as necessary and doing some good as they have been attacked and vilified and the claim has been made that they are no longer needed. I think you read in “envy”

Thus you fail to see why the U.S., which had so much going for it for so long, now has so much economic pain. The facts of the socialist FDR policies that precipitated the Great Depression are ignored. Precipitated? Are you one who denies that the Great Depression started and was in full swing before FDR was elected and took office? His policies did not “precipitate” the Great Depression (you should more closely examine the policies of Harding, Coolidge and Hoover and the underlying economic realities of the 20’s for the cause) they were enacted in response to the already ongoing Great Depression. Now one can debate whether those policies helped to alleviate or to prolong the Great Depression–but it is incorrect to say they Precipitated it.

Economist Larry Kudlow and Wall Street Journal editorial board member Steve Moore point to the Carter-era Community Reinvestment Act of 1977 (CRA) that purported to prevent denying mortgages to black borrowers - by pressuring banks to make home loans in “low and moderate-income neighborhoods.” Under the act, banks were to be graded on their attentiveness to the “credit needs” of “predominantly minority neighborhoods.” (30/3/2008)
Is there something wrong with asking a bank to make a loan to a qualified applicant wanting to purchase a house in a low to moderate-income neighborhood? Is there a reason a bank shouldn’t? There is something wrong when two applicants–one white and one black–with the exact same qualifications–don’t receive the same treatment and the government is not wrong to attempt to assure equal treatment. Done properly–loans to qualified applicants in these areas would --in the long run–help to keep those neighborhoods stable to improving.
That fact that people abuse these programs or do not administer them properly–is not a reason to discredit them.

The debacle of the Government Sponsored Enterprises (GSEs), Fannie May and Freddie Mac, that bought loans from the Banks and often bundled them as mortgage–backed securities for sale to investors, enabled the banks to issue more mortgages, fuelling the inflation of home prices by artificially diverting resources into mortgage lending. These are known as sub-prime mortgage securities. Adjustable rate mortgages, fueled by people speculating in house purchases, and artificially low interest rates created by the Federal Reserve, were a major factor in defaults as prices fell in 2006.
Yes–of couse. It has nothing to do with lax oversight. It has nothing to do with people falsifying income, nothing to do with people making loans to borrowers they know didn’t qualify so they could get their commission, nothing to do with phony appraisals, etc. etc. etc. Lets blame Fannie and Freddy because people lie, cheat and don’t do their jobs. These issues are so much more complex than government bad, free enterprise good.
Federal intervention creating a feeling of prosperity stimulates the boom-bust cycle, resulting in an inevitable crash. The free market is always blamed for that crash. These artificial booms, wrote economist Henry Hazlitt, must end "in a crisis and a slump, and . . .worse than the slump itself may be the public delusion that the slump has been caused, not by the previous inflation, but by the inherent defects of ‘capitalism.’ .
Would you outline what you see as the federal interventions during the 1920’s that created a feeling of prosperity stimulating the boom-bust cycle that ended with the Great Depression?

Did you not know that 68% of all income taxes come from the top 10% of earners? (Woods, p 142). Did you know that this top 10% of earners account for 46% of all adjusted gross income?

While rightly condemning all greedy and heartless, perhaps you also failed to see Christ’s reward for prudence, justice, fortitude and temperance:
In the parable of the talents, Jesus lauds the servant who has multiplied talents – “For to everyone who has, more will be given, and he will have abundance; but from him who does not have, even what he has will be taken away. And cast the unprofitable servant into the outer darkness. There will be weeping and gnashing of teeth.” (Mt 25: 14-30). Christ certainly praised the wise use of the fundamental right of economic initiative and prudence in this parable. Could this parable be about more than simply money? Does this parable say anything about the use of those talents? Does it address hoarding of talents? Does it address living the good life? Is it a parable applauding the accumlation of wealth and living the good life or is a parable about working and making the most of what you are given? If when we die we have been unprofitable servants of the Lord–what will happen to us? Won’t we find ourselves weeping and gnashing our teeth? On the other hand if we were profitable servants of the Lord won’t we find ourselves richly rewarded? Is Christs reward for being a good, faithful and profitable servant in this life of the next? /quote]

Peace,
Mark

 

[tommcguire]

Mark,

I deeply appreciate your response to Abu. My historical knowledge is very limited; your challenging questions need to be addressed.

As I was reading your comments, I wondered how much all of us depend on our ideology for coming up with answers to profound and complex questions, and pay little attention to the facts when facts contradict our ideology.

I was also thinking of China. China has brought more people out of poverty in the last 30 years than any government in history. It has a Communist government that has committed terrible crimes against the Chinese people. I know this from many Chinese friends. Yet, despite the ideology, the lives of people have been improved. Maybe there are some models of dealing with economic issues that we humans have not yet explored.

I respect the ancients, including the old scholastics, but will not accept that they had the answer to all human problems.