Pope John Paul II wrote the following in Centesimus Annus:
Can it perhaps be said that after the failure of communism capitalism is the victorious social system and the capitalism is the victorious social system and that capitalism should be the goal of the countries now making efforts to rebuild their economy and society? Is this model which ought to be proposed to the countries of the Third World which are searching for the path of true economic and civil progress?
The answer is obviously complex. If by “capitalism” is meant and 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 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.” But if by “capitalism” is meant a system in which freedom in the economic sector is not circumscribed within a strong juridical framework which places it at the service of human freedom in its totality and which sees it as a particular aspect of that freedom, the core of which is ethical and religious, then the reply is certainly negative. (Centesimus Annus, 42)
Pope John Paul II clearly saw the distinction between capitalism grounded in biblical ideas of shalom and human community versus capitalism based in laissez-faire, survival of the fittest, materialism and individualism. The economic system is, by and large the same. The fundamental difference is the values fed into the economic system and the institutions that spring from those values.
I want to reiterate what I am calling capitalism. I use Rodney Stark’s definition:
Capitalism is an economic system wherein privately owned, relatively well organized , and stable firms pursue complex commercial activities with a relatively free (unregulated) market, taking a systematic, long-term approach to investing and reinvesting wealth (directly and indirectly) in productive activities involving a hired workforce, and guided by anticipated and actual returns. (56)
I don’t think the economists I know would have a problem with this definition. They might tweak it slightly but it is a good working definition of capitalism. What I want to emphasize is this: Free market capitalism is not intrinsically individualistic or materialistic. Just because many expressions of capitalism today are very individualistic and materialistic, it does not follow that the economic system itself is defective. This is like the lung cancer patient concluding she got lung cancer because of defective lungs, after years of smoking three packs of cigarettes a day. However, both socialism and completely unregulated markets are flawed systems that damage the image of God in humanity. No amount of virtuous intent will make them work.
Many theologians and social observers have correctly identified the Western world’s slide into individualism and materialism. Some communities of Christians have completely adapted themselves to this individualism and materialism. They unquestioningly embrace it. This is seen all too frequently in many Evangelical and conservative circles. Social critics rightly point out this cooption and challenge it.
The critics of this accommodation often come from mainline traditions, from a minority in the Evangelical left or from groups like those involved in the Emergent conversation. (The Roman Catholic tradition has people who are all over the map.) While they rightly diagnose the problems of materialism and individualism, they incorrectly view them as intrinsic to capitalism. Capitalism, following thinking similar to that of Max Weber’s, is believed to be a product of Enlightenment era thinking. To be postmodern means abandoning modernist affectations and capitalism is at the top of the list things to be abandon.
But as I have shown in this series, capitalism pre-dates the Enlightenment by several centuries and deeply rooted in Christian perspectives on humanity and the world. The particular economic outcomes we see today are the consequence of modernist players in the market acting on their values. Change the orientation and actions of the market players and you will get different outcomes. No, it is not the economic system that is the fundamental problem. The fundamental problem is the Church. (Stay tuned.)