Chapter 1:    Social Justice and the Catholic Bishops' Letter on the U.S. Economy

Principles and Outline of the Letter
Tradition of the U.S. Bishops on Economics
Hidden Traditions and Lost Critical Voices
Characteristics: A New American Experiment

  Chapter 2:    Conservative Critique of the Bishops' Letter:
Assault on the Welfare State

Conservative Redefinition of Social Justice
Two Views of Democracy and Capitalism
The Law Commission Report on Economics and the Welfare State
Conservative Political Economy: Anderson and Benne
Critique of the Bishops' New American Experiment in Economic Democracy

       Chapter 3:    The Creed of Conservative Ethics:
Capitalist Theology and the Metaphysics of Economics

Moral Foundations of Novak's Democratic Capitalism
Moral Self-Development and Economic Inequality in Liberalism
Social Ideals and Market Rationality
Fetishism of Human Rights: Reduction of Rights to Market Liberties
Rationalization of Individual Rights
Benne's Use of Rawls's Principles of Justice
Rationalization of Democracy: Technocratic Liberalism from Weber to Benne
Contradictions between Ethics and Political Economy

Chapter 4:   Toward a Critical Theory of Political Economy:

Critique of the Bishops' Letter from the Left: The Domestication of Social Ethics
The Politics of Poverty and Inequality in the Welfare State
Inequality, Ethics, and Human Potential
Economic Crises and Corporate Restructuring
Productivity, Scientific Management, and the Dual Labor Market
Class Functions of the Welfare State: Economic Accumulation and Political Legitimation
Spending Priorities of the State: Socialization of the Private Costs of Production
The Reagan Legacy: Leveraging of a Deindustrialized America

       Chapter 5:    Nineteenth- and Twentieth-Century Catholic Social Critique:
The Popes Speak

Leo XIII (1878-1903): Natural Law over Natural Rights
Pius XI (1922-1939): Liberal Heresies
Pius XII (1939-1958)-John XXIII (1958-1963): Modernizing the Tradition
Paul VI (1963-1978): Third-World Struggle
John Paul II (1978- ): Toward the Millennium
Questions of Authority

       Chapter 6:    Liberation of the Bible:
Advocates and Critics

Depoliticizing Scripture
The Praxis of Piety vs. Voodoo Theology
The Authority of the Word
Beyond the Eclipse: Liberation Theology and Moral Restructuring
Conservative Critics: Catholicism in Crisis

       Chapter 7:    Liberation Theology and Dependency Theory in Latin America:

Introduction Modernization Theory and the Stages of Economic Development
Types of Underdevelopment and Dependency Theory
Underdevelopment in Spite of Industrialization
The Missing Theory of Political Economy

Title Abbreviations Used in Notes







    This work is a recent paperback reprint of our 1992 book from Orbis Books on the social ethics and critique of modern industrial society found in the American Catholic Bishops' 1986 statement Economic Justice for All: Pastoral Letter on Catholic Social Teaching and the U.S. Economy. This letter on ethics and political economy begins with an analysis of the philosophical and theoretical origins of Catholicism in the social ideals of ancient Israel and Greece. By returning to the classical traditions, the bishops develop a comprehensive treatment of their theories of social justice, moral economy, and economic and participatory democracy. Although our book was originally published in 1992, and there have been many macro-economic, historical, and social changes since then, the inertial logic and internal structure of Reaganomics remain in place today.

    The question is finally out of the bag and there is no longer any possibility for not discussing it in public: Is America a fair and just society? Does it permit the fullest development of our moral, spiritual, and intellectual autonomy? Liberal and conservative academicians have been discussing this for years in the works of Rawls, Nozick, Friedman, and Walzer. However, the question today has overflowed its academic boundaries with the publication by the American Catholic bishops of their pastoral letter Economic Justice for All. The letter focuses on a discussion of the poverty, inequality, and powerlessness in American society, on the nature of fairness in economic distribution, and on the nature of political and economic democracy. It summarizes traditional Catholic social teachings and places them within the context of their philosophical and theological lineage in ancient Greek philosophy, Hebrew legal codes, medieval theology, and modern ethical thought. The bishops then proceed to judged America by these ethical standards of the Church and American is found morally wanting.

    In this work we also wish to examine the classical concepts of "social ethics" and economic justice as they are applied by the bishops to an analysis of the social, political, and economic institutions of America. A study of the Bishops' Letter on social justice in America and the conservative and left reaction to it provides us with an opportunity to look at the changing ethical values and perspectives of the hierarchy of the North American Catholic Church. In the process we able to open up the full range of debate about the nature of social ethics, including political, ethical, and economic issues. Since the bishops borrow from such a broad range of intellectual traditions, including the Old and New Testaments, church doctrine and history, papal encyclicals, Aristotle, Kant, Rawls, and the U.N. Declaration on Human Rights, this letter also offers us an opportunity to rethink the nature of ethics and social justice in relation to current questions of political economy in American society.

    This book is organized into three major parts: the moral dilemma created by the American Catholic bishops' critique of liberalism, the contemporary political and theological responses to it by the right and the left, and the issues of ethics and political economy as they are worked out in the Third World, that is, in the questions raised by liberation theology and dependency theory.

    In 1984 the National Conference of Catholic Bishops released after several years of preliminary study the first draft of a controversial letter on economic justice in the U.S.; a year later a second, slightly shorter draft followed. By November 1986 when the final report, Economic Justice for All, was approved by the bishops, a long and intense process of public consultation had taken place. The original committee, including Archbishop Rembert Weakland (Milwaukee, WI), Archbishop Thomas A. Donnellan (Atlanta, GA), Bishop George Speltz (St. Cloud, MN), Bishop William Weigand (Salt Lake City, UT), and Auxiliary Bishop Peter Rosazza (Hartford, CT), incorporated in the text insights from economists, business and labor leaders, sociologists, theologians, and others, Catholic and non-Catholic alike. A similar pastoral, The Challenge of Peace (1986), critical of national policy on nuclear deterrence and an unbridled arms race undercutting economic stability, had already prompted vocal criticism of the American bishops for their moral pronouncements on military spending and the dangerous stalemate of Cold-War politics. The airing of critical views on the American economic system and nuclear brinkmanship by the bishops, representing over 50 million U.S. Catholics, was seen by critics and supporters alike as a powerful and influential factor in national debate, although the bishops took special steps to isolate these pronouncements from ties to party politics. Modern America was weighed in the balance and found wanting by the prelates, especially in its failure to address adequately the misery of the poor in our midst and abroad. The economic system of liberalism, whether in its politically conservative or liberal guise, was judged "a social and moral scandal."

    This description of the moral dilemma posed for the materially prosperous Catholic Church in twentieth-century America drew from a long and complex historical experience and theological tradition in Catholicism, especially since the papal encyclical "On the Condition of Workers" (Rerum Novarum, 1891) by Leo XIII and subsequent letters on the social question by later popes. Archbishop Weakland, chairman of the five-member committee that drafted the economic pastoral, has referred directly to this distinctly Catholic body of social teaching that helped shape the bishops' thinking: "I am grateful to all those popes and others who have worked on Catholic social teaching over the past hundred years or so. Without that body of reflection, we would be in a very difficult position today. When I deal with the non-Catholic community in dialogue of this sort, they can sense that their denominations did not evolve that same kind of a social teaching. They have the "Social Gospel" principles, but without the same body of reflection that we have in the Catholic tradition, coming from the end of the past century. Despite the fact that Catholic social teaching may have started as a response to particular situations, I see it as a great boon for us today in dealing with situations in which we find ourselves."

    In the first part of this book we explore the principles and characteristics of the Catholic Bishops' Letter and the often hidden antecedents of diverse views: papal, episcopal, and lay, that have provided the ideas and vocabulary expressed by the bishops. Two days before the publication of the first draft of the Bishops' Letter, a group of prominent, conservative Catholics, called the Lay Commission on Catholic Social Teaching and the U.S. Economy, issued Toward the Future (1984), a spirited defense of the American economic system which they alleged was under attack by the bishops who wanted to replace the free-market economy with some destructive brand of socialism in a misguided attempt to alleviate poverty. William Simon, former Treasury Secretary and one of the organizers of the Lay Report, insisted that it was a clear fact of historic experience "that economics dedicated to freedom, individual opportunity, and non-inflationary economic growth do far more to alleviate poverty and suffering than all the schemes of the social engineers and commissars of history." The 31 members of the Lay Commission, including such notable Catholics as the former U.S. Secretary of State Alexander Haig, the former U.S. Secretary of the Interior Walter J. Hickel, Clare Booth Luce, and J. Peter Grace, rejected the view they saw advocated by the bishops in which the free-market system was depicted as the incarnation of greed and selfishness, inherently incompatible with Christian morality. Such positions, Simon insisted, are themselves unsupported by either the bible or the traditional teachings of the church. Instead, they assert, the bishops have substituted the political agenda of the secular left, especially an enchantment with aggressive government intervention and redistribution programs. In Simon's view these meddlesome priests should stick to "canon law and Latin liturgies."

    The second part of this book, then, deals with the variety of criticisms of the Bishops' Letter from the right and left of the political spectrum. Chapters Four and Five analyze the redefinition of social justice in terms of the practical and theoretical views of conservative writers who have addressed the relationship of ethics to political economy. Michael Novak, a co-author of Toward the Future and Robert Benne, a professor of church history attempt to establish the ethical justification of democratic capitalism by grounding their theories in the liberal tradition. What is particularly fascinating is that the former turns to John Locke and Robert Nozick, whereas the latter turns to the theory and method of John Rawls in their criticisms of the welfare state, socialism, and liberation theology. But there is a major problem in these different variations on American conservativism. They have failed to understand the incompatibility between their political philosophy and their economic theory.

    They have also failed to recognize the incompatibility of the different traditions within liberalism itself and thus unknowingly combine the categories of liberty and freedom, inequality and human dignity, consumerism and self-realization, and liberalism and democracy. The result is an ambiguity and incoherence in their theories of liberalism. There is no attempt to resolve the contradictions between a social system founded on freedom within a community, human dignity, self-realization of human potentials, and democratic participation, on the one hand, and one founded on the principles of consumer choices, individual liberties, inequality and class, and market liberalism, on the other. Nor is the distinction between a liberalism of natural rights and a liberalism of technocratic elites seen as a problem in their combination of distinct traditions.

    A second and related problem is that such hybrid theories make it unusually difficult to understand the history and structures of American political economy. In fact, it makes it unusually difficult even to develop a theory of political economy. The American bishops, to the extent that they uncritically accept such general views of liberalism, also fall into these dilemmas. They neither recognize the logical traps in liberal political philosophy or the difficulties of developing a theory of political economy. Both the Lay Report and the Bishops' Letter fail to contain a developed historical and structural analysis of American political economy. In their desire and haste to move from moral principles to public policy recommendations, the bishops gloss over serious political and economic problems. The result is that their "New American Experiment" becomes entangled in a quagmire of unresolved conflicts within liberalism. The contemporary responses, left and right, to the Bishops' Letter can thus be read in the larger context of debates about economic structures in modern liberalism. Chapter Six begins to resolve some of these difficulties by developing a more critical and radical view of American society and the existing interrelationships between labor, corporations, and the modern state.

    In the third part of this work we examine the implications of these attempts by the U.S. bishops to relate Christian social doctrine to international political and economic issues. This means widening the area of discussion to include the Third World, since the bishops recognize in an increasingly clearer way what John Paul II has called in his encyclical "On Social Concern" (Sollicitudo Rei Socialis, 1989) the "radical interdependence" that binds the First World to these desperately impoverished regions. As conservative theorists have been quick to map out in terms of geo-political demands for national security, Nicaragua is closer to Texas than Texas is to Maine. One could easily say that the Third World is as close to Middle America as the nearest bankrupt Savings & Loan, as the most recently auctioned family farm, as a relocated factory leaving the Rust Belt, or the fiscal effects of increasing economic instability brought about by the mushrooming national deficit. The Third World, rather than a glimpse of America's pre-industrial past, may be a glimpse of its post-industrial future.

     While the biblical theology of justice and "preferential option for the poor", worked out on the local grass-roots level in the various theologies of liberation still seems more closely identified with the Third World, North-American theology is also beginning to listen and to speak in these words. Both First and Third Worlds have something to learn from each other regarding a more just distribution of goods and more open participation in economic democracy. The third part of the book, then, examines how current liberal and conservative debates over economic development in the Third World, combining with the debates raging in liberation, biblical, and political theologies, define in new ways the nature and function of social ethics and shape the common social life of our citizens, religious and non-religious alike. The ambiguous and tentative relationship between liberation theology and dependency theory is also examined in the writings of Latin-American theologians.

    Passages from both the Old and New Testament will be carefully studied in order to help clarify differences of interpretation of the political messages of the bible. Our purpose here is to unravel the ways in which the American bishops have systematically stripped the bible of its political content resulting in a depoliticization of Scripture. A comparison of approaches will be made between the North-American bishops and the more critical and revolutionary Latin-American theologians. We are also concerned with asking the question: Why have the North American and European conservatives been so critical of both liberation theology and dependency theory? What are the assumptions and hidden values which underlie their different approaches -- their theologies and metaphysics of economics?

    Despite trenchant criticisms from various quarters, the Bishops' Letter remains an unparalleled achievement in articulating a moral vision applied to the contemporary crisis in American economic life. The insistence that ethical questions are central to economic and political decisions and not just a pious cog in the wheel of market forces was not a widely welcome position in the early 1980s, euphoric over rapid pay-offs in the business sector. As America faces the last decade of the millennium the social and human costs of indiscriminant deregulation, junk-bond buy outs, back-door lobbying, corruption in government agencies, and fraud even from the suppliers of hardware for national defense have made more citizens attentive to the issues raised by the bishops and subsequent declarations made by other religious groups. The icons of national greed and vulgar consumption have become a household litany: Boesky, Milken, Keating, Helmsley, and Trump. The bishops have done much to focus attention and provide an ethical vocabulary to the opening economic debate.

    This is all the more remarkable because it has been done in the face of significant opposition within the ranks of the Catholic community, for the most part conspicuously enjoying the economic and political benefits of this free-market liberal democracy. The authority and prestige of the bishops as unquestioned religious guides has been placed at risk and their pastoral judgment characterized often as an ignorant or malevolent intrusion of an all too visible clerical hand into politics and the economy. The process of public consultation and debate, published and refined in succeeding drafts, was seen by some as itself an abdication of traditional authority, since earlier church proclamations had so often appeared as almost sacred oracles, above discussion and response. The bishops had now drawn back the curtain and shown the delicate machinery by which some 400 bishops of diverse politics, training, and intelligence arrived by compromise at a delicate moral consensus tailored to the American scene. In itself the process was a bold affirmation of the bishops' trust in the "new experiment" in democracy they advocated.

    And yet for all the good achieved in this process, stimulating the public debate on crucial issues, the letter remains a long, dry, and largely unread document, derived from a rich and subtle tradition of Catholic social thought which itself is hidden and seldom preached. The American Catholic bishops as shepherds and teachers have failed to teach their own followers the history and tradition of the church's social doctrine, stretching back to biblical times. The bishops, while suggesting prudential proposals for addressing the crisis of poverty in American society, have consciously or unconsciously neglected to perform the kind of structural analysis of American political economy needed, if their recommended economic remedies and ethical prescriptions are to have any real affect for the common good. For this to occur there must first be an historical and hermeneutical recovery of those traditions which the bishops have recognized as foundations for the development of a theory of social ethics and justice. Though the Hebrew, Greek, medieval Christian, and modern Church traditions are mentioned, there is little reflection on their relevance and applicability to the present situation in America. The real meaning and force of these documents are turned into reified rituals and consequently lost in a general moral amnesia. In our work there is an attempt to recover the lost meaning of some of these traditions by an archaeological rolling back of the layers of stale social science and biblical interpretation in order to uncover the theoretical potentials hidden beneath them.

    These missed or rejected opportunities and traditions which we explore more closely in the following work are the reason that the Bishops' Letter on the economy, despite great expectations in these hard times, is more accurately seen as a chronicle of lost possibilities. The theoretical and structural possibilities of a new society are eclipsed, when the traditions upon which they are based become pale reflections of the search for dignity and autonomy in the classical periods.

    There has been much discussion in recent years about the rationalization of ethical language and the narrowing of moral discourse, which has closed off reflective and critical discussion on a whole panoply of important social issues. The rich traditions of Western ethics from the ancient to modern times have been reduced to issues of moral philosophy. This could be called the "social amnesia" of modernity. In this condition moral language "works to preserve the status quo by presenting the human and social relationships of society as natural -- and unchangeable -- relations between things." By limiting morality to issues of individual consciousness and concupiscence, we have produced a form of moral rationality and discourse that has been unable to see the connections between political, economic, and social issues and the moral questions of right and wrong. That is, ethics has lost its original theory of political economy. What had once been part of the classical traditions has been lost to Western society and moral rationality.

    In the Anglo-American tradition of philosophy the area of ethics has generally been interpreted to refer to "metamorality," that is, to an analysis of the logical aspects of moral choice. Ethics in this view deals with the logical clarification of the range of moral choices and options available to the individual with whatever accompanying implications and ramifications. Thus, it is an area for the philosophical articulation and clarification of the moral life itself. More recently the definition of ethics has been expanded with the renaissance in political theory, especially with the works of John Rawls and Robert Nozick, among others, who reintroduce the political element back into ethics.

    Though we applaud these efforts, we also recognize that even these important works in political philosophy have not included all those areas which were once part of the classical traditions of ancient Greece and Israel, and their conception of ethics: encompassing social traditions and customs, political philosophy, and economic theory. In the later development of the classical traditions in nineteenth-century philosophy and theology, Hegel was the first modern thinker to bring together both political economy and philosophy as he moved from an "ethics of morality" to an "ethics of politics."

    It was Hegel who rediscovered "institutional ethics" by integrating Aristotelian philosophy and Kantian morality. The moral autonomy and respect for human dignity of the modern individual was integrated with an examination of the culture, politics, and economy of the community. The religious tradition has also stressed the norms of human dignity and responsibility, based on a communitarian understanding of full participation by each individual in society. In Catholic social thought we see a consistent attempt to integrate a natural philosophy of community with one grounded in a "revealed" vision of faith.

    Reading the works of Rawls and other social philosophers, one can see the traditional emphasis on moral philosophy and individual choice-making begin to shift to a broader range of philosophical issues, which include questions of political freedoms, social justice, and the nature of the state. This advance, however, never fully captures the diversity and subtlety of issues contained in the classical traditions. Ethics too often is still limited mainly to questions of economic distribution and issues surrounding the just distribution of public goods within the market. Analogies can be found, as critics have indicated, in modern Catholic pronouncements on social issues, focusing almost exclusively on distributive justice, rather than on questions of the moral production of wealth or the dynamic nature of the modern economy. The on-going debate has focused, instead, on the standard of measurement that would be used to better distribute the social wealth of the community: standards based on equality, needs, individual effort, contribution, or social agreement. The more inclusive redefinition of ethics certainly was a positive step, since it moved morality away from its limiting features, the exclusive stress on individual rationality and freedom found in Kantian practical philosophy and religious doctrines focused solely on private moral culpability. Though ethics was now placed within the context of political institutions, it still had not encompassed the deep structures of political economy. A goal of our work, then, is to apply a developing theory of social ethics, which would include an analysis of personal moral values, as well as the economic, political, and social institutions that constitute the heart of American society to which the Catholic bishops have addressed their pastoral letter.

    Having said this, the first question which arises is: What is social justice when applied to an analysis of an advanced capitalist society such as the United States? Any definition of social justice must go beyond the traditional categories of distributive justice, possessive individualism, and political theory (income and wealth distribution). Going beyond justice does not entail a rejection of the notion, but a broadening of its range of theoretical and practical applicability. Since distributive justice is itself a function of deeper structural features of the economy, then the former must develop into a concern with economic justice and the critique of political economy (the analysis of corporate restructuring, reorganization of labor, and new functions of the state in advanced industrial society). In turn it must also move beyond economics and the private sphere to include the area of political justice and the public realm, which deals with questions of the protection of human rights and individual freedoms, human capacities and potentialities, the social possibilities of self-realization and development, the social institutions for encouraging self-determination, and political and economic democracy. These three forms of justice -- distributive, economic, and political justice, constitute what we call social justice. This form of structural and societal justice, when combined with an individualistic moral philosophy within a holistic framework, is then called social ethics. The possibilities of individual self-determination and self-realization depend on the establishment of basic moral and political principles, an historical and structural analysis of American political economy, and rational implementation through public policy of its social ideals.

    An important question may be raised early. Why are these social arrangements necessary for a consideration of ethics? The answer is that, as in the case of the classical traditions, the primary philosophical question remains the examination of the nature of justice and the good life. That is, it requires a detailed study into those social institutions which make rational choice and self-determination possible. This, as Rawls has recognized, can only be adequately dealt with by an analysis of the "basic structure of society." But as the U.S. Catholic bishops themselves have seen, any analysis of society includes consideration of both political and economic arrangements, since only within the totality of social institutions can the questions of community, the common good, moral autonomy, and human dignity be adequately addressed. The specific questions, which interest us in this book, are those that center on the bishops' critique of American society and their understanding of the relationships between their moral values and their concrete policy recommendations for the implementation and realization of these values. Along with these central questions, there are others. Is the bishops' understanding of American social institutions and political economy adequate to realize the moral values which they propose? What exactly is the relationship between social structures and moral norms, political economy and ethics? If their specific economic and political policy recommendations could not implement their underlying values, does this turn ethics into a political ideology? Can the moral vision the bishops articulate ever be realized within the structures of American social life as they are now constituted?

    In summary, the following are the major themes that form the central focus of this work:

            (1) analysis of the ethical, religious, and economic components in the Bishops' Letter on social justice (Chapter One).
             (2) examination of the letter's ethical and religious foundations in the Old and New Testaments, Greek philosophy,
            Church social teachings, social and political theories of Kant and Rawls, and the U.N Declaration on Human Rights
            (Chapters One, Two, and Four).
             (3) comparison of the letter to previous American Catholic Bishops' statements on the U.S. economy since the early
            twentieth century and to papal encyclicals of the past one hundred years critical of the rise of liberalism and capitalism (Chapters One and Two).
             (4) critique of the understatement or elimination in the letter of the critical ethical and religious traditions (Chapters One and Two).
             (5) study of the conservative and radical responses to the letter (Chapters Three and Four).
             (6) critique of the letter for not recognizing the contradictory nature of the concepts of equality and liberalism, liberty and freedom,              (7) investigation of the economic and political structures of U.S. and Third World societies (Chapters Five and Eight).
             (8) development of a critical theory of political economy which includes an analysis of the restructuring in the American economy
            of the relations between industry, government, and labor; examination of political economy as a form and subbranch of ethics
            (Chapters Five and Eight).
             (9) study of the relationship between liberation theology and dependency theory (Chapter Eight).
             (10) analysis of conservative and radical criticisms of liberation theology, its economic theory, and biblical interpretations
            (Chapters Six, Seven, and Eight).


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