December 4, 2013 39 Comments
This week we have been looking at the economics aspects of Pope Francis’s Evangelii Gaudium, here, and here, from an American perspective, and quite frankly they range from leftist to communist. I doubt that is exactly what he meant so maybe our reading is not quite what he meant. Because our culture doesn’t do economics or law quite like the rest of the world. In many ways our culture is the culture of the English-speaking world. In our world we have, and have had for over a thousand years, through invasion, conquest, revolution, regicide, more revolution, colonization and much more the same basic law, the common law which has built on its shoulders all the way from an illiterate, Anglo-Saxon backwater to the globe circling colossus that we have become. In fact, yesterday, The Federalist, published a post, linked here, which made some interesting comparisons, “When we match up the Cato Institute’s Index of Economic Freedom with the World Bank’s measure of per capita income, we find that the countries with the most unencumbered systems and the most financial “speculation” usually have the least of amount of poverty:
Hong Kong — $51,946
Singapore — $61,803
Australia — $44,598
New Zealand — $32,219
Switzerland — $53,367
Canada — $42,533
Chile — $22,352 (Chile’s score has jumped considerably since unfettered capitalism took over)
Mauritius — $15,649
Denmark — $42,086
Anything catch your eye about that list? Did you notice that with the exception of Switzerland, Denmark, and Chile, they are all ruled by the Common Law. Per capita income infers that it is about the average wage, half above and half below. That’s quite a record for the legacy of a damp island off the coast of Europe, and I would bet that the United Kingdom itself would be on that list as well if the leeches in Europe weren’t draining it. India will probably be joining the list soon as well, it takes time to increase the income of 2+ billion people.
By the way the Pope’s native Argentina is at $18,200. And with considerably less difference between rich and poor.
But it’s not all about economic systems. There far more to life, or at least should be, than earning a living and Dan Mitchell reminds us.
In an earlier post, Dan told us about the effects of the free market in the Pope’s neighborhood.
As you can see, Chile used to be the poorest of the three countries and now it is comparatively rich. Argentina has enjoyed a bit of growth. Venezuela, by contrast, used to be the richest of the three nations but has stagnated and now is in last place.
So what accounts for these remarkable changes in relative prosperity? The answer, at least in part, is the difference between free markets and statism. Simply stated, Chile has reduced the burden of government a lot in the past three decades, Argentina has reduced the burden of government a little, and Venezuela has gone in the wrong direction and increased the burden of government.
While by no means saying that the Pope is a leftist, he seems to have used the left’s old idea of conflating capitalism with corporatism, that rank system of buying and selling of political influence which pervades much of the west today, thereby constraining it from reaching anywhere near its potential. This is one of the major problems in the United States today. Not capitalism but the lack of capitalism. There’s something structurally wrong when the highest income and most dynamic area of the country is the one most dependant on the government. In great measure we have become a rule of men, not of law, this is the great flaw of the Obama administration. It is why Hong Kong is by far outperforming us.
That’s what the rule of law means to the people, as John Adams put it “A rule of Law, not of Men”. I suppose we shouldn’t blame the Pope too much, he has never lived in a society where the law applied to the government, and Italy itself isn’t all that much better. I suspect a lot of eyebrows were raised all over the English-speaking world when Italy thought it proper to indict Amanda Knox for the second time. In all of our countries when the government loses, it loses forever, always has, always will.
Last week, we talked a bit about Daniel Hannan’s (MEP) new book, that post is here, I quoted this from the book
We are still experiencing the after-effects of an astonishing event. The inhabitants of a damp island at the western tip of the Eurasian landmass stumbled upon the idea that the government ought to be subject to the law, not the other way around. The rule of law created security of property and contract, which in turn led to industrialisation and modern capitalism. For the first time in the history of the species, a system grew up that, on the whole, rewarded production better than predation.
Why did it happen? Why, after thousands of years of oligarchy and tyranny, did a system evolve that lifted the individual above the tribe rather than the reverse? How did that system see off rival models that elevated collective endeavour, martial glory, faith and sacrifice over liberty and property? How did the world come to speak our language?
There is a very good video at that post, or here, that will add much to your knowledge how we came to our position in the world. Mr. Hannan, like us all, makes much of the enlightenment roots of our success, and that is correct. There is more to the story though.
There is a story of a very senior cleric assisting the Barons of a Realm to put curbs on the King, who held his Kingdom as a direct Fief of the Roman Pope. That churchman was Stephan Langton, Archbishop of Canterbury, and the King was John. That is the short history of Magna Charta, and I think it could only have happened in England.
And then, something really remarkable happened. I’ll let Dr. Suzannah Lipscomb tell you about it.
I find her persuasive, and not only did the Tudor dynasty make Britain, it made America, and Canada, and Australia, and New Zealand, and Hong Kong, and Singapore, and increasingly India as well. And the phrase “a Tudor Enterprise” is well-chosen as well. Most of the American colonies got their start as joint stock companies, not crown colonies. America started as a for profit business, not any political scheme at all.
But I hear you asking, what has all that to do with Evangelii?
Quite a lot, as a matter of fact, even if we set aside the disparity of income in the free English-speaking world, for the moment, we find that one of the major things that sets us apart from the rest of the world is that we believe, we really, really believe, in the rule of law, including property law. As such we believe that an individual earned what he has, and its up to him to spend it as he pleases, if he got rich we try to emulate him, not steal his stuff. Which has never stopped us from also being the most charitable people in the world, because we also believe “Of those whom much is given, much is also demanded”
In fact, if you watched the interview by Dan Mitchell above he made the point as well. He reiterated it in his post here
..My second most important point, which came near the end of the interview, was that genuine compassion is when you give away your own money, not when you vote for politicians who will use coercion to redistribute other people’s money. I should have used the opportunity tocite the data showing that Americans are far more compassionate – in the right sense – than their European counterparts.