tommcguire
Catholic social doctrine is emphatic about the obligation on the part of employers to pay a just wage.
On fixing a wage, in
Quadragesimo Anno, 1931, Pius XI asserted “the condition of a business and of the one carrying it on must also be taken into account; for it would be unjust to demand excessive wages which a business cannot stand without its ruin and consequent calamity to the workers.” (#72). Even here, this does not consider the effect of reduced employment if the business still operates at all.
This particular insight clearly shows the appreciation of what Pope John Paul II called “the right of economic initiative” in the economic laws discovered by the Catholic Late Scholastics and the operation of cause and effect in a free economy based on the common good of society. It recognises that unemployment may result from attempts to force wage increases which are unrelated to, or out of sync with, the effects on supply and demand for the goods or services produced by a business or an industry.
It is vital to realise the development in Catholic Social teaching that has occurred. On wage fixing the Catholic Late Scholastics favoured leaving wage determination to the ‘common estimation’ of the market, since any other method is inherently arbitrary and leads to endless complications.
Here, Fr Brian Harrison, O.S., in *Religious Liberty And Contraception *is helpful (John XXXIII Fellowship Co-op (Australia), 1988, p 22-23), concerning “the practical order: human rights and duties.”
“But for a certain norm of action to be a matter of doctrine, it would clearly have to be proposed as a universally binding norm – one which is of certain validity always and everywhere. Thus, we could not elevate to the status of doctrine a norm which is proposed provisionally, and as subject to possible future correction after future consideration; nor one which is a particular ad hoc decision applying to given circumstances which might turn out to be transitory; nor, finally, one which is a concrete directive designed to give practical force to a doctrine which is in itself too broad or general to have much effect without such further application or specification. (An obvious example of such a doctrine would be the teaching – both natural and revealed – that a labourer deserves a just wage.)
Popes have warned explicitly against thinking that they have unique insights into specific matters of economic policy:
“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].
No wealth can be created until it is produced – that’s why the Late Scholastic system works so well to enable everyone to produce some wealth and to do with it as they choose through free-will. Economic laws are based on the principles of human action – of cause and effect involving God-given reason.