On Monday Trent was invited to speak to students at Benedictine College about his new book Why Catholics Can’t be Socialists. In this talk Trent explains what socialism is, the “incentive” and “knowledge” problems that undermine it, and why the Church has always opposed this economic system.cou
Welcome to The Counsel of Trent podcast, a production of Catholic Answers.
Welcome to The Counsel of Trent podcast. I am your host, Catholic Answers apologist and speaker Trent Horn.
Earlier this week, I was given the opportunity to give a talk on socialism at Benedictine College. Well, I was Skyped in to give the talk. And I thought it went very well. We definitely had far less technical difficulties than I had with my talk at Taylor Seminary.
For this episode of the podcast, I want to share my talk. It’s a neat sneak preview of my book Why Catholics Can’t Be Socialists, so you’ll get to hear some excerpts and me talking more about the book.
If you are a premium subscriber to the podcast at trenthornpodcast.com, you can access the Q&A session afterwards, so go to trenthornpodcast.com. For as little as $5 a month, you get access to bonus content, keep the podcast going. The bonus this week is you get to hear my Q&A session, where I talk about things like distributism and crony capitalism, so you’re not going to want to miss that if you’re a subscriber. Otherwise, here you go. Here is my talk at Benedictine College on why Catholics can’t be socialists.
Well, welcome, everyone. Thank you for being able to come by. You all get a chance to have a sneak peek of my new book that I’m going to be releasing in the spring called, appropriately enough, Why Catholics Can’t Be Socialists. It’s a book that I’ve coauthored with Catherine Pakaluk, who is an economist. She got her PhD from Harvard, and she currently teaches as an associate professor at The Catholic University of America.
We spent a lot of time on this. It’s a subject that is big in news and politics. It comes up, and people wonder what the Catholic perspective is on this, so we hope that our work will be helpful in guiding people towards making ethical economic and political decisions on very important things that affect many people.
With that said, I think I’m just going to go through just some of the highlights of the manuscript and share it with you, then I’m sure we’ll have some time for Q&A here at the end. It’s always hard when I do these things on Skype. Just raise your hand if you can hear me. Okay, put your hands down. Raise your hand if you can’t hear me. Okay, good. See? That was a test. I’m going to assume people were laughing uproariously, because I can’t hear anything you guys are saying. It’s all good.
All right, so let’s talk a little bit then about socialism. Between the 1840s and the 1940s, the papacy released eight major encyclicals that dealt with either socialism or communism, and they talk about it in very stark terms.
Actually, let’s make sure we’ve got this… I got another recording here. Good.
They talked about the wicked theories of socialism and communism. They are meant to overthrow the entire order of human affairs. They teach through a haze of perverted teachings. Pope Leo XIII called socialism “a deadly plague that reaps a harvest of misery.” 30 years later, Pope Pius XI said, “Communism is intrinsically wrong, and no one who would save Christian civilization may collaborate with it in any undertaking whatsoever.” They had some pretty harsh words when they talked about…
Sorry, is someone talking? Something came in here. That’s okay.
Those are very harsh words. Why did the popes teach this, and what should we think about that today? How should we understand socialism, its relationship to communism, and how should we make decisions understanding economic systems and how to carry out God’s will in providing for the common good?
Well, in order to continue that discussion, we need to talk about what socialism is. That’s really the key thing. When people talk about this issue and they have disagreements about it, nine times out of 10, they mean different things by the word that they’re talking about. In this case, socialism can be very elastic in its meaning, so we have to make sure that we get the meaning right when we compare it to what the Leonine popes, people like Pope Leo XIII, Pope Pius XI, and even onward, talked about when it came to this issue.
What is socialism? I think a good way to talk about what socialism is, compared to what it’s not, is to use an example from American history. If you remember the story of the Pilgrims we learned in elementary school when you were coloring in those turkeys and making the hats with the buckles on them, we always thought, “Oh, well, the Pilgrims were starving because they didn’t know how to farm the land, and thank goodness Native Americans came and helped them.” The Native Americans did help them through a food shortage during the first few winters, but the problem was they continued to have food shortages even after that harsh winter.
It wasn’t ignorance that led the Pilgrims to have a food shortage. As Governor William Bradford writes in his journal on the matter, the governor of the Massachusetts Bay Colony, he said the reason they had food shortages was because they had chose to practice communal farming instead of private farming with privately owned lots.
What happened is that people weren’t allowed to grow their own food in the Pilgrims’ colony. Instead, the food was grown together in a communal plot and then equally distributed to everybody in the colony. That meant people who didn’t farm any of it got the same rations as people who did farm the land. In choosing this method of farming, Bradford says the Pilgrims thought “the taking away of property and bringing in community into a commonwealth would make them happy and flourishing, as if they were wiser than God.”
As you read his journal, his tune really changes after that. He says that people complained and the system didn’t work at all. He said young men complained about “spending their time and strength to work for other men’s wives and children without any recompense.” Wives viewed their forced work for other husbands and families as “a kind of slavery.” Even older residents who couldn’t work and actually got more food than they normally would have, they “thought it some indignity and disrespect unto them.”
The problem was people eventually saw that there were some people who did backbreaking labor in the fields to keep the system going and there were others who either did less arduous work or didn’t work at all, and yet everybody got the same amount of food rations. This communal farming system, it could tolerate a few people skipping out on the communal responsibilities, but there was a tipping point, and once you went past that tipping point where enough people stopped caring to put in the really hard work for the farm to prosper, it only took bad luck or a bad crop or bad weather to really destroy the meager food supplies they had.
Governor Bradford, he recognized this and he said, because “all men have this corruption in them, God in His wisdom saw another course fitter for them.” What he goes on to say in his journal is that instead of a communal farm, he allotted a private parcel for every family to farm their own food. They could keep it or they could sell the excess.
This is what he said in his journal. He said, “This had very good success, for it made all hands very industrious, so as much more corn was planted than otherwise would’ve been.” This sentiment actually echoes what the Greek philosopher Aristotle taught 2,500 years ago when he said, “That which is common to the greatest number has the least care bestowed upon it. Everyone thinks chiefly of his own, hardly at all of the common interest.” This is still true today.
I remember once I was taking my son out riding his bike, and he was still learning to be potty trained. Kids are funny. Jim Gaffigan has a bit about this, where kids don’t tell you when they need to go to the bathroom; they more tell you when they’re going to the bathroom. So we were out, he was riding his little bike, and he’s like, “I need to go potty.” I’m like, “Oh,” trying to find a place, and I go into the public restroom and it is atrocious. I will not take him in there. I’m worried he’s going to get hepatitis or something. We managed to get back home in the nick of time, and it was clean, because what’s yours, you end up taking care of more. What’s public, everybody thinks that it’s somebody’s job, and it turns into nobody’s job.
That story I think can help us see that when it comes to understanding what socialism is, socialism is not a belief that we ought to help the poor, because everybody except for Social Darwinists thinks that. Rather, it’s the disagreement about what is the best economic system that provides for all people.
It’s also not about the idea that government ought to provide for the poor through social entitlement programs or social welfare programs. A person can be a harsh critic of socialism and still support government programs that provide entitlement benefits to people, food stamps, housing vouchers, school choice vouchers, things like that.
In fact, a May 2019 poll found that one-third of people associated socialism with just that, providing healthcare, housing, and jobs to people, and 20% in the poll didn’t even really know what socialism was. Only 20% of the people in the poll could identify socialism by its classical definition, and that would be this, the government ownership of the economy and the abolishment of private property and the transferring of the means of production, means of producing wealth and goods, from private citizens and firms to government or centrally owned agencies.
That’s the hallmark of socialism, and has been for all socialist countries. This is something that defenders of socialism bluntly say is the case. For example, Bhaskar Sunkara, he just wrote a book defending socialism. He’s the editor of the popular socialist magazine Jacobin. He says, “Radically changing things would mean taking away the source of capitalists’ power, the private ownership of property.” This is the same thing that Karl Marx talked about in The Communist Manifesto. He said, “The theory of the communist may be summed up in the single sentence, abolition of private property.” That’s why Pope Leo XIII, in his encyclical Rerum Novarum, On New Things, like the advocacy for socialism, one of the new things the pope was talking about, he said, “The main tenet of socialism, or the community of goods, must be utterly rejected.”
To understand it then, this communal ownership of wealth and property would also entail that no one would be able to exchange privately owned goods in order to make a profit. Instead, society would simply produce goods by the command of a government-owned industry. It’s those industries alone that would sell them. Hence, we call socialist economies command economies or planned economies. The political scientist Frances Fox Piven puts it this way. “The academic debates about socialism’s meaning are huge and arcane and rife with disagreements, but what all definitions have in common is either the elimination of the market or its strict containment.”
We’re way past when we defend classical socialism… Whether you call it socialism or communism, those terms tend to be used interchangeably, that socialism actually first referred to the final stages of communism when you would have a classless and stateless society, where all people were equal in their abilities and their compensation and all worked for the common good. Communism was supposed to be a road stop along the way to achieving full-fledged socialism, where you had no classes, no rich, no poor. Instead, you just had one community working together.
When we talk about these command or planned economies, they required administrators and bureaucrats, like accountants, economists, statisticians. They would direct factories, farms, and businesses, or what we would call the means of production, to produce just the right kinds of goods and services people desire, or what the central planners think that people need, not leaving it up to market forces for private firms to produce things based on what they think they can viably sell.
For example, one defender of socialism, in his book Socialism…Seriously: A Brief Guide to Human Liberation, Danny Katch, he envisions a future, he doesn’t think it’s entirely realistic, but what he would hope for of what a socialist world would look like, would be that the community would just produce so many goods that the work week would only be between Tuesday through Thursday. In his book, the person in this futuristic socialist society says, “Each year, the whole money thing feels increasingly pointless in a society in which everyone has more than enough of what they need and plenty of what they want, but money is still the main way for planning committees to keep track of how goods and services are being distributed and used.” For him, money would be kind of archaic. There would just be so ample production of goods and services, government would distribute them to people, and everyone would have what they need, and ideally, I guess, what they want, but it never quite works out that way.
Now, when people talk about socialism, though, a lot of people will ask the question “Yeah, okay, maybe not socialism like that, but what about democratic socialism?” Once again, it just depends on what you mean by the term. If by democratic socialism you just mean government advocating for values Catholics can agree with through entitlement programs, like a preferential option for the poor, or securing things so that laborers have the right to form unions so they can collectively bargain for better working conditions and pay, there’s nothing contrary to that at all. But if you just say democratic socialism to mean you use democratic principles like majority vote to take away the means of production from private individuals and firms, and transferring that to, essentially, collective or government ownership, then that would be problematic because the Church has condemned socialism regardless of the means you get there, whether it’s by the dictatorship of one person and an army or the tyranny of the majority. The majority of people cannot vote for something that violates the rights of other people.
For example, when you look at some democratic socialist proposals, Neal Meyer is an author in Jacobin magazine, and he says democratic socialism means the right to healthcare, right to housing, and the right to “a union job that pays well,” that government would provide every single person a union job that pays well for them. In fact, Pope Saint John Paul II, writing in Centesimus Annus in the early 1990s, commented on a proposal like this, and he said, “The state could not directly ensure the right to work for all its citizens unless it controlled every aspect of economic life and restricted the free initiative of individuals.”
He did contrast socialism with the social welfare state, and while a state providing benefits to its citizens is not wrong in and of itself, the pope actually did have some criticisms and concerns for it. He said that the welfare state, if it grows too large, “leads to a loss of human energies and an inordinate increase of public agencies, which are dominated more by bureaucratic ways of thinking than by concern for serving their clients, and which are accompanied by an enormous increase in spending.”
Which is true, because when you look at, for example, a private company that operates based on maintaining a profit to show that its returns are greater than its expenses, to see that the company is successful, you look to see which ones have the best profits. Now, of course, profit is not the only measure of what makes a company good or bad, but it’s a helpful measure of economic health of a company. By keeping profits high and costs down, that shows the health of a private organization. But with government, a lot of government agencies, there’s always a push to get a bigger and bigger budget. If you have a bigger budget, that means you’re more important, so it’s actually a perverse incentive there.
Since socialism is gradually introduced in societies, what my coauthor and I talk about in our book is that there’s no such thing as a purely capitalist society and a purely socialist society. Some people say, “Well, they’re both equally wrong, when you have socialism and then laissez-faire, or hands-off, capitalism without government regulation.” Capitalism can’t exist without some form of government regulation. At the very least, government is required to recognize private property rights, to recognize the legitimacy of contracts that people engage into. People need recourse to government in capitalist societies in order to enforce laws against fraud, for example.
Government will always be involved in managing economies in some ways. The real question that divides socialists from those who would be critics of socialism, who really vary in their spectrum, because there are people who don’t identify as capitalists who are critics of socialism, the spectrum really is more “Okay, what role do the means of production, do they lie within the realm of private industry and firms who operate out of seeking profit to meet consumer need through the free exchange in a marketplace, or are the means of production something that’s something centrally owned by government and is part of a centrally planned economy, where goods and services are allocated based on the needs that central planners think is necessary for society?”
There’s a spectrum. I think the Heritage Foundation has an index of countries based on their economic freedom, and so it ranks them. I think North Korea and Venezuela are at the bottom of the economic freedom index, and at the top you have countries like Singapore and Hong Kong, which have, compared to other countries, relatively few restrictions on private businesses, but they still restrict against things like fraud and things like that. Then as you go down the line between Singapore and Hong Kong and Venezuela and North Korea, which are separated by 179 countries in between them, you will see a lot of countries in the middle, like, for example, France is right smack dab in the middle because they use indicative planning. It’s not central planning like socialism, but government is aggressively involved in promoting certain industries over others. If you look at the United States, we’re probably around 12, 14 on the economic freedom index.
Ironically enough, people often say the Nordic countries are a model of socialism, but they aren’t. The prime minister of Denmark has said that Denmark is not a socialist economy; it is a market-based economy. When you look at Denmark, Sweden, Finland, Norway, they rank usually between numbers 16 to 22 on the economic freedom index. While they are very large social welfare states and have many entitlement programs, they primarily funded those programs through vigorous free market activity, usually several decades ago.
We recognize that there’s a spectrum here, and what we are concerned about is advocating policies that move countries towards the socialist end of the spectrum. That often can take place in the nationalizing of industries, that if you take an entire industry and remove it from the hands of private actors and have government involved, you have to approach that very carefully. We encourage skepticism of that. There are some things, of course, industries that only government can do, law enforcement, courts, military, and even, in some cases, providing utilities, though, frankly, the state-provided utilities here in California, for lack of a better word, suck. You can just look at all the fires we’ve had in the northern part of the state, and the blackouts they have to do to keep all of that from going haywire.
You have this spectrum there on that, like, for example, nationalized healthcare would be something that I think Catholics should be concerned about, if healthcare is removed entirely from the private sphere. One of the questions that I would be concerned about is, what do you do then if government as a central planner decides that, through a national healthcare program, treatments are free, and one of the treatments that are free are sterilization, contraception, and abortion? If government provides that through a national healthcare program, what do you do if you run a Catholic hospital and that’s mandated? In good conscience, this Catholic hospitals would have to close. They couldn’t participate, cooperate in these kinds of intrinsic evil. That would just be one concern.
We’ve seen that in other cases. For example, let’s take government schools, government providing schools and funding them in competition with private schools. Some people will say, “Well, public schooling,” I prefer the term government schooling, “public schools are an example of socialism.” No, that wouldn’t be an example of socialism. What would be socialism is if government moved the education industry under its own control and outlawed private competition, which does happen in the Nordic countries. You do have cases there where homeschooling is illegal. I think in Finland and Norway, in some cases homeschooling is illegal. Private religious schooling is illegal.
That’s concerning, because people tried to do this in the United States. Back in 1922, the state of Oregon passed a law outlawing parochial private education, and that went all the way to the Supreme Court in 1925. In that case, the Little Sisters v. Pierce, the Court ruled that the state cannot mandate education in government schools. In fact, a line from that case ended up appearing in an encyclical by Pope Pius XI, Divini Illius Magistri, and that line he borrowed from the Supreme Court case a few years earlier was “The child is not the mere creature of the state.”
Ironically, that is in contrast to one of the early socialist reformers, Friedrich Engels, who was a collaborator of Karl Marx, who said, “The care and education of the children becomes a public affair. Society looks after all children alike.” Now, in the sense that if you mean that society works together to make sure no child is deprived of basic necessities, yes, that’s a good thing, but when you remove the authority that parents have to educate their own children or to collaborate with other parents and religious schools to do that, you have a serious problem on your hands.
All right, well, let’s talk about some of the reasons why not just Catholics, in my opinion, but really anyone who thinks about what is the best kind of economy to serve the common good, why they shouldn’t be socialists. Many of these themes were also touched on in encyclicals from Pope Leo XIII onward, even Pope Pius IX, before Pope Leo XIII.
When socialism was first prominently advocated in the middle of the 19th century, as soon as the Church became aware of this and the disputes related to it, the Church recognized the legitimate concerns that working people had at the time of working in degrading, subhuman conditions, and the need to address the social question. The social question was not “What do we do about widespread poverty?” because widespread poverty was the norm for the human condition for all of history until the Industrial Revolution. Until the Industrial Revolution, everybody was poor. There were maybe a few kings and rulers that weren’t, but widespread poverty was the norm, not the exception. Rather, the social question in the 19th century was, through the Industrial Revolution, there are growing pockets of wealth among the poor, so what do we do to encourage this wealth to continue to be produced, but at the same time benefit the poor who sometimes don’t see the benefits of the system for themselves?
Let’s talk about two problems related to socialism, and then I’ll close with some more of what the popes have said in their concerns about it, which were not solely related to socialism often being tied to totalitarian regimes or atheistic regimes. Those are serous problems, but that wasn’t the core of their concern with socialism.
First is the incentive problem. Marx’s goal was the elimination of social classes. You don’t have rich and you don’t have poor. You would eliminate classes. But there’s a problem that arises because we use financial incentives to encourage people to start businesses and take on certain jobs that are more difficult, require higher training, or just less desirable than other jobs. If no one were richer than anyone else, if everyone was essentially compensated the same and they received the same wages, then why would anyone be motivated to choose the dangerous or dirty occupations? Some people would who just enjoy that kind of stuff, but a lot of other people wouldn’t do that. If you got paid the same amount of money, would you rather clean car windshields at the car wash or be hanging up on a skyscraper 80 stories above the earth?
The problem is that the most important function of unequal wages is that the compensation can adjust to create incentives for people to do the jobs that need to be done. If these incentives are abolished by equally distributing property and wages among people, which is what Marx and others want, people will say, “Well, they didn’t say that,” but the problem is if you have no classes, if you have no rich or poor, if everyone is the same economically, then logically they all have to be paid the same. They all have to possess the same amount of wealth. Then the problem is you’re providing equal compensation for jobs and services that are very unequal in many respects, and so it’s just not tenable.
Also, if you try to create a socialist society that doesn’t have these classes, there are still going to be these classes because there are certain jobs people are going to want to lobby for, and the central planning authorities will have to allocate who chooses those jobs. For example, most people… I live in San Diego. Most people don’t live here. It’s beautiful here, but most people don’t live here because it’s preposterously expensive. But if housing and wages were all provided equally by government, why wouldn’t you just choose to live in the most idyllic places and work the most idyllic jobs? People would naturally go there. Well, that means government would have to step in and decide who gets to live in these certain places and who doesn’t. It’s going to have to allocate and severely curtail people’s freedoms to decide who does what jobs and where do people live.
There are different solutions that socialists have tried to propose for this idea that, well, how are jobs going to be allocated? If we don’t have a free market where people have incentives to choose certain jobs based on the skills they’ve developed and the compensation they receive in the jobs, how are people going to be incentivized to choose the jobs that are more difficult, more necessary, or the jobs that require years and years and years of training and schooling to master a craft? Many people will not put in that effort to learn it unless they’re well-compensated afterwards.
Some people have offered solutions. One that Marx put forward in his vision of socialism was he talked about the idea that people could share jobs, and you would just rotate. He said, by doing this, there would be so many goods, that we would just produce so many goods, he says, “It would make it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticize after dinner, without ever becoming hunter, fisherman, herdsman, or critic.” The problem here is that if you have that kind of society, you never have anyone who devotes the time to becoming an expert in his or her field. Otherwise, I would ask anyone who’s interested in Marx’s view, do you really want someone who doctor is a part-time hobby for them? I certainly don’t.
This also is a problem for moderate socialism, that says, well, even if people keep their private property, the government will just confiscate wealth and redistribute it so that all wealth is equal. Well, if you do that, if people know they will never retain an income beyond a certain point, they lose their incentive for creating wealth beyond that point that they will never keep. Now, some people will produce wealth and voluntarily give it away to help others, but when we just look at human nature to see the way people just are in their human nature, most people won’t do that, to produce things if they know inevitably they won’t produce the fruit of their own labor. But if they stop producing that wealth for these large, large taxation schemes, the system doesn’t really work, and it’s the Pilgrims’ starvation problem all over again.
Let’s talk about the second problem, though, that has been associated with socialism. This comes from the economist and philosopher Friedrich Hayek. This would be the knowledge problem. This is a very serious problem for socialism if by socialism you mean centralized planning, or that you don’t have private actors, people who decide to start businesses, charge what they want, sell a product, retain profits, and people interact with one another freely. If you just have government centrally planning and producing goods and then distributing them, even if it’s producing them abundantly and distributing them, you run into this knowledge problem.
For example, if you’ve ever seen a flock of birds, it’s amazing how they go in unison. How do they do that? If you look at a flock of starlings, these flocks can be gigantic. They can have thousands of birds flying together, and they’ll just turn immediately in a different direction. But how do they do that? If you watch a symphony, there’s a conductor that moves the whole symphony where they go, and that works for a small symphony. But there’s no bird that’s the conductor of the flock.
So if there’s no single bird telling them where to go, where do they all go? Well, what happens is some of the birds recognize that they need to change direction, and when they subtly change their wing position, this essentially sends an information wave through the flocks faster than a single bird commanding the other birds could ever get to them. That information wave from the subtle bird movements of the wings directs the whole flock where to go without there being a single director telling the flock where to go. The knowledge of where the flock goes is not contained by any single member of the flock. Instead, it’s distributed among all of the birds and shared. No single one has all the knowledge.
That was something that Friedrich Hayek discovered. He won the Economic Nobel Prize in 1974. He said this. He talked about an important element of economic knowledge.
Now, I’m speaking as best I can on this, by the way. I have a master’s in theology, a master’s in philosophy, master’s in bioethics, so I’m not an economist, but that’s why I had an economist be a coauthor with me in this book. She would speak to this as more of an expert than I would, but I speak more primarily, also, to the theology. I mean, I understand the economics enough to write this book, but I have written a lot, also, on the theology, which we’ll get to here after I talk about the knowledge problem.
What Hayek said was that the important knowledge in economics is this, the knowledge of the particular circumstances of time and place. He says, “We need to remember only how much we have to learn in any occupation after we have completed our theoretical training, how big a part of our working life we spend learning particular jobs, how valuable an asset in all walks of life is knowledge of people, of local conditions, and special circumstances.”
The problem is that when you have a large, complex economy, there is a knowledge of time and place, of local circumstances, how things are produced and exchanged, is widely distributed among tens of millions of people. That knowledge is necessary to make financial transactions and financial decisions. No single individual, not even a supercomputer, could process all of that in real time as it’s necessary.
To give you an example how complex economies can be, you have to think about the decisions that go into making something like a loaf of bread. How do you make a loaf of bread? Well, the farmer has to decide what kinds of grain he’s going to plant and the machinery he buys to harvest the crops, and the bakers have to decide, “Well, what ovens do we use to make this bread? What other ingredients do we put into the bread and get from those companies?” The shipping companies have to decide, “Well, what kind of trucks do we use? What rail cars do we use to ship the product?” The wholesalers have to know how much bread to purchase from the factories, and then when they turn around, the retailers have to know how much do they need to purchase from the wholesalers for when people come in to buy things. That’s just for the bread. Imagine the plastic bag that wraps around the bread. That’s even more complex. It starts with drilling oil from the ocean floor before it becomes a plastic bag that goes around the bread.
How do you direct all of these actors to act in the most rational way to create goods at low prices for people to be able to purchase? That is where prices come in. That was Hayek’s observation.
What is a price for something? A price is not, as Karl Marx thought, it’s not simply the amount of value that went into producing something. It’s partly that. Some people think, “Well, a price is just how much this is worth based on the amount of time I spent making the thing.” That’s a part of it, and it’s intuitive to our understanding of pricing, so it describes past behavior somewhat. But prices are also a… They’re primarily a description of present behavior.
Like the wings in the flock of starlings, they’re signaling devices. A price is a signaling device that immediately transmits information to consumers, whether it’s retail consumers, whether it’s wholesale consumers who are buying bread from farms or farmers who are buying equipment. Prices send information in an efficient way better than any central planning authority and government could send information to different groups.
For example, let’s say there’s a shortage of rye for rye bread. There’s different kinds of bread. You go to the store, say you want rye bread, and there’s a shortage of it. Well, how do you communicate that? Well, when that happens, the price of rye bread goes up. The farmer, he doesn’t have to call the store and tell the store, “Hey, tell the people who come in, ‘Don’t buy too much rye bread, because if you do, we’re going to run out and we’re going to have a shortage. You should only buy it if it’s absolutely necessary.'”
He doesn’t have to call and tell them that. Through a chain of transactions, the price changes from the wholesaler to the retailer and the consumer, and people see that when the price goes up, when you’re in the store, you see, “Oh.” The consumer doesn’t even have to know there’s a shortage. All they’re communicated is “Okay, to keep rye in production, I have to spend more to get it. Otherwise, I can’t take this. More money is required to continue the production of this particular commodity.” That’s communicated to the producer.
The price, when it goes up, also sends a reverse signal back to the wholesaler. It sends it to entrepreneurs to say, “Hey, the price of rye has gone up. You have an opportunity to make more profit if you produce this particular commodity.” All of this takes place with localized knowledge.
The problem is, though, if… That’s just bread. You go to anything else, there’s so much more to take into account. That’s why socialism doesn’t work, to say, “Well, we’ll overproduce goods,” if government just says, “We’re all going to work together and produce a lot of things so that they’re cheap and easily accessible.” The problem there is you can’t. You only have a finite amount of resources in any economy to produce things. You can’t produce surplus amounts of everything. If you’re going to make surpluses, you’re invariably going to have to not produce certain goods in order to overproduce other goods.
Now, in a market-based economy with prices, there are incentives and ways to transmit whether this is a good idea or a bad idea. What planners learned, especially in countries like the Soviet Union, was that when you centrally plan this, you invariably overproduce things that you don’t need and you underproduce things that you do need. That’s why the Soviet Union experienced things like bread lines.
In 1982, for example, The New York Times noted how the Soviet Union’s newspaper, Pravda, said that Soviet collective farming was more productive than American capitalist farms. But the Times noted, “Unfortunately for the people in the food lines, statistics about the Soviet Union suggest otherwise.” Pravda’s propaganda just couldn’t hide the fact that planned economies were inferior to free ones. They just couldn’t keep up. The Times said in 1982, “The United States, with less than 5% of the labor force working in agriculture, keeps supermarkets stocked from one end of the country to the other, and still exports nearly a third of its farm output,” even though far less amount of the labor force in the United States at that time was involved in agriculture.
Finally, let’s take a look then at what the popes have said and what were some of their arguments against socialism, which, as I said, they criticized its atheism and its totalitarianism, but really a lot of that, those weren’t accidental accretions to socialism, that socialists, they want to create essentially a heaven on earth, and in doing so, having the state be the means to provide for everyone, atheism naturally flowed into that, and totalitarianism naturally flowed, because if you have central planners who are deciding what goods will be produced and for what price and then distributing them to people, and you make these calculations, you can’t have a black market.
A black market under socialism is any privately produced good or service. That’s why, in Cuba, many, many transactions, a large percentage of people’s transactions, are done on the black market to get goods and services the government simply doesn’t provide or doesn’t produce. Government can’t allow black markets because it disrupts the central calculations of the central planners, and so that’s why states developed totalitarian methods to keep these illegal activities from happening. That’s why in the East German government, which was controlled by the Soviet Union, they developed the secret police, or the Stasi. Something like, at one point, one in seven people in East Germany were working for or with the Stasi to inform on their compatriots.
Let’s talk about Pope Leo XIII’s primary argument based on the right to private property, though. He said that socialists “deprive a worker of the liberty of disposing of his wages, and thereby of all hope and possibility of increasing his resources and of bettering his condition in life.” On his letter on socialism, he said, “They assail the right of private property sanctioned by natural law, and by a scheme of horrible wickedness, while they seem desirous of caring for the needs and satisfying the desires of all men, they strive to seize and hold in common whatever has been acquired either by title of lawful inheritance,” and Marx wanted to outlaw inheritance, to keep people from, if you develop property and acquire goods, from being able to give them to your children, that you have a moral responsibility to care for, “or by labor of brain and hands or by thrift in one’s mode of life.”
Leo’s argument also rests on our moral duty. It’s like if I have a duty to fill my car with gasoline, it follows I have the right to drive my car. I can’t fill it with gas unless I can drive it to the gas station. Likewise, if we have the duty as rational human beings to carry on lives that are not merely like animals, going from biological need to biological need, but to focus on pursuing the good, then Leo said, “It must be within man’s right to possess things not merely for temporary and momentary use, as other living things do, but to have and to hold them in stable and permanent possession.”
He goes on to talk about the right to property. This reminds me, also, of an analogy that the Roman orator Cicero used. Because people will say, “Yeah, but right to private property is not absolute,” and that’s true. It’s not absolute. The popes, going back to St. Thomas Aquinas, talked about the universal destination of goods, that no one person or people can own all property or own nature and the earth that God has given us. God has given it to us, but that doesn’t prevent us from being able to use the earth and own parts of it as an extension of our own rational nature.
Cicero used the analogy of a theater in ancient Rome. He said, “Though the theater is a public place,” no one person owns the whole theater, “it is correct to say that the particular seat a man has taken belongs to him, so in the state or in the universe, though these are common to all, no principle of justice militates against the possession of private property.”
Pope Leo said the same thing, essentially saying that the fact that God has given the earth for the use and enjoyment of the whole human race, can in no way be a bar to the owning of private property. Private property is limited. For example, if someone is starving to death and you’re in the midst of a natural disaster and the grocery store has been abandoned, or you need medicine, someone is dying, and the grocery store has been abandoned, you can break into the grocery store in the case of necessity, and that would be imminent, grave necessity, to take property to secure the common good, the good of life. But that doesn’t entail that, therefore, there is no right to private property at all, and government can seize it for people’s goods. Rather, private property is something that serves the common good as a whole.
When people are allowed to own private property, they are allowed to specialize, and the ownership of private property, including its growth into large corporations, ends up serving the common good. I’ll give you an example. In 2015, Andy George, a guy on YouTube, he tried to make his own chicken sandwich from scratch. He grew his own wheat, made his own bread, slaughtered his own chicken, went to the ocean to get salt. He made a chicken sandwich completely from scratch. It took him six months and $1,500 to make a sandwich that didn’t taste very good. But you and I can go to a fast food restaurant and get one for 0.003% of the cost and 0.0003% of the time because of private property that allows people to divide their labor, to specialize in their labor, and have a market where property can be sold in order to benefit other people.
Just to go here… I guess just to wrap up, this denunciation of socialism continued all the way into the late modern era. Pope Paul VI said, “Too often, Christians attracted by socialism tend to idealize it in terms which, apart from anything else, are very general, a will for justice, solidarity, and equality,” and he went on to say that’s completely coherent with Catholic social teaching. You don’t need to be a socialist. You just need to espouse Catholic moral teaching, which was what the Solidarity movement did in Poland in the 1980s.
Poland, occupied by the Soviet Union, felt that workers were being exploited by this centrally planned communist government, so they formed Solidarity. The Church was a supporter of Solidarity. In fact, Catholic Masses were one of the few safe places people could meet to gather and speak about this. One of the priests who was involved in the Solidarity movement, Fr. Jerzy Popieluszko, he talked about how to preserve one’s dignity as man is to remain interiorly free even in external slavery, to remain oneself in all situations of life, to remain in the truth even if that is to cost us dearly.” He spoke out against the evil, as Pope Pius XI said, the intrinsic evil of communism, treating people as being mere parts of the state, instead of persons with their own right to private property.
Fr. Popieluszko paid the price. He said, “And it cost us dearly,” and it did, because on October 19th, 1984, three members of the Polish security service kidnapped him. He was 37. They beat him to death and dumped his body in a reservoir. That didn’t crush Solidarity. It actually galvanized it, so much so that it helped for the leader of the Solidarity movement, Lech Wałęsa, to win the first free elections in Poland.
Then a few years after that, in May of 1991, the Berlin Wall fell down. Pope Saint John Paul II wrote about that in Centesimus Annus, where he said that “The Marxist solution has failed.”
Sorry, a little feedback there.
It says that a person who is… Sorry, Pope Saint John Paul II said, “A person who is deprived of something he can call his own, and of the possibility of earning a living through his own initiative, comes to depend on the social machine and those who control it. This makes it much more difficult for him to recognize his dignity as a person, and hinders progress toward the building up of an authentic human community.”
Now, continuing on, Pope Saint John Paul II did not believe capitalism unrestricted was the answer. He talked about how capitalism ought to be restricted with a strong juridical framework. But all of the popes, none of them ever said capitalism in and of itself was evil, like they did of socialism or communism. They said there were potentials for evils and pitfalls that needed regulation. Of course, what is a viable and correct form of capitalism would be an entire other talk in and of itself.
But with the Marxist solution failing, as Pope Saint John Paul II said, he pointed towards capitalism being a possible answer, but one that would require the application of sound moral principles that the Church itself guides. He said the Church does not offer its own economic model; that’s not what the Church offers. But, for example, the Church offers Catholic medicine, in the sense it offers Catholic moral principles to practice medicine, but the Church doesn’t teach how to cure somebody of a fever. The science of medicine does that. So the science of economics teaches us how to generate wealth in a population, and Catholic moral principles tell us how to do that in ethically normative ways that are in coherence with the Gospel.
Yeah, that’s your little sneak peek of my book, and I’ll take a few questions now.
If you liked today’s episode, become a premium subscriber at our Patreon page and get access to member-only content. For more information, visit trenthornpodcast.com.