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Pope On a Soapbox

Does anyone in their right mind really think the market makes the rules? Apart from the Pope...?
IN REPORTING the Pope's recent apostolic exhortation, writes Sean Corrigan at the Cobden Centre, the Financial Times' blog is, as we might expect, a somewhat tendentious selection, archly culled from the proclamation.
But, in the spirit in which it is there presented, let us deal with a few of the passages excerpted from the Pope's comments on free markets...
"While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation..."
No, such gross inequalities arise only due to state intervention (not least in the imposition of flawed systems of state money), from state-granted legal privilege, and through the state-exercised, post hoc largesse which is routinely showered upon its favoured lackeys whenever they make one of their frequent gross errors of judgement or succumb to their all too typical and wholly execrable violations of ethics.
Let us here be clear, whatever the Pope may think, tax minimisation is not one of the latter. A man's honestly come-by income is his, not his petty overlord's, to dispose of and all non-violent efforts he makes to reduce the depredations being visited upon that income are just.
The problem with this contention is that the ability to do so not extend equally to all. Thus, the larger fish – flaunting their state-granted immunities – swim free while the smaller fry – who might one day grow to be their competitors were they not so viciously oppressed – are caught in the net and squeezed all the more mercilessly in order to make up a budgetary shortfall (which itself only seems so pressing because of the insatiable lust for power of their rulers).
Jesus may have made a point of cultivating the company of publicans – i.e., of tax farmers – as a way of showing up the self-righteousness of the Pharisees, but He was surely not suggesting that it was their office that was the highest of all callings in that it assisted the voracious state in its attempt at ensuring 'a better distribution of income' – better distributed to its functionaries and supporters for the most part, that is.
"...they reject the right of states, charged with vigilance for the common good, to exercise any form of control. A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules."
Does anyone in their right mind really think the market makes the rules? If so, then why are we plagued with a cradle-to-grave, self-perpetuating, largely self-selecting claque of political parasites and bureaucratic busybodies whose path up the greasy pole to view 'all the kingdoms of the world, and the glory of them' consists of a never-ending striving to think up new rules, regulations, prescriptions and prohibitions to impose upon the rest of us, the better to prove the political 'vision' – and hence fitness for high office – of their promulgators?
Furthermore, it strikes one as the bitterest of ironies that in this flight of rhetoric the Holy Father has seemingly chosen to confound the utterly notional 'tyranny' of fair dealing and contractual fulfilment with the innumerable, very real horrors inflicted upon his flock by that most bestial of institutions, the state, throughout its long, bloody history.
In a true free market – however much of an abstraction that concept may, alas, remain – self enrichment can only come about as the reward for a meritorious success in best satisfying the material needs of others. This is hardly a 'tyranny'. Indeed, if anyone is subject to such a binding constraint, it is the profit-seeking entrepreneur since, in such a world, he is a man who earns his daily bread by making sure others receive theirs at the lowest cost, in the highest abundance, on the most regular basis, according to the shortest delay, and comprised of the greatest quality. If he does not do so as a matter of basic business principle, he risks soon going hungry himself.
Moreover, the 'worship of the ancient golden calf' which is held up as so abhorrent a practice has always been something most pitilessly enforced by the state, not the market. Leviathan – in order to shore up the pillars of its earthly dominion – has typically either perverted true faith into a religion of diabolical service to own glorification, or else has set itself up as the secular deity, one to be defied only at the price of life, liberty, and property. It is therefore not the 'idolatry of money'wherein we meet the most awful, crushing, 'inhuman dictatorships', but in societies which pretend to despise honest trade and which prey upon fruitful commerce.
"We can no longer trust in the unseen forces and the invisible hand of the market...[and when, pray tell us, did we ever get a chance fully to do that?]
"Growth in justice requires more than economic growth, while presupposing such growth: it requires decisions, programmes, mechanisms and processes...[etc. etc...]"
Perhaps we might encourage His Holiness to find time among his regular schedule of devotions to read a little Hayek and perhaps some Buchanan, for here he has succumbed to the fallacy of the pretence of knowledge and he is also gathering up tares, not wheat, by failing to take note of the teachings of 'public choice' theory.
Planning – for that is what this passage is advocating – is the scourge which drove us into this mess in the first place. The very 'decisions, programmes, mechanisms and processes' being implemented by the idiot savants and the hubristic meddlers who populate the ranks of the influential are what keep us mired within that mess and so prolong the suffering of one and all, far beyond their due measure and far in advance of their allotted span.
Our new Pope is doubtless a man of unimpeachable piety and great personal humility, but what the chosen paragraphs appear to demonstrate is that the concept of his infallibility is rightly reserved for his considered pronouncements on matters of doctrine, not economics or even politics. Otherwise, he would surely acknowledge that, for all the inevitable human failings of the individuals who make up the class, entrepreneurs routinely do, have always done, and always will do more good for more people in more instances than ever have or ever will the commissars, crony plutocrats, and corrupted vote-mongers from whom the redactor (if not necessarily the Pope himself) finds them drearily indistinguishable or else beside whom she deems them decidedly less commendable.
That the post concluded with fashionably cheap jibe en passant at the Tea Party – that howling mob of ape-knuckled reactionaries which so stubbornly resists all that uplifting soixante-huitardprogressiveness which the more enlightened so joyously embrace – reveals much about the ideological intent behind the careful culling of the Pope's words, as does the breathless worship of Keynes and Krugman which has become FT Alphaville's default setting.
Yet there are one or two phrases in the Apostolic which could be cited to support a completely opposite view of the world, as for example, when the Pope says:
"...Today's economic mechanisms promote inordinate consumption, yet it is evident that unbridled consumerism combined with inequality proves doubly damaging to the social fabric..."
Agreed. But on the FT blog the talk is usually a wearisome rehearsal of 'paradoxes of thrift', 'liquidity traps', and of the need for programmes of economic 'stimulus' which are all aimed at fostering that two-masses-for-the dead, pyramid-building Uber-consumption of the kind which can only spawn what are ultimately unsustainable levels of 'Debt and the accumulation of interest [which] also make it difficult for countries to realize the potential of their own economies and keep citizens from enjoying their real purchasing power...' – that latter a cry not to resort to any further inflationism, perhaps; not to mention a suggestion that we might do well to reduce, not inexorably increase, indebtedness, pace the Bloomsbury Sage and his brutish New York Times enforcer?
And as for the inherent collectivism of much of the commentary here, well, there is always this to consider:
"...all this becomes even more exasperating for the marginalized in the light of the widespread and deeply rooted corruption found in many countries – in their governments, businesses and institutions – whatever the political ideology of their leaders."
Here, Pope Francis – if with perhaps not the greatest degree of consistency, given what he has argued earlier in his address – is categorically expressing his deep disapproval of those same enlightened, disinterested, Platonic philosopher-kings to whose tender judgement we are often told in the FT we should commit our care, lest the evils of the market come upon us as a wolf upon the fold.
Adding to this, in a different section, the pontiff argues that,
"...the principal author, the historic subject of this process [of building a fair society], is the people as a whole and their culture, and not a single class, minority, group or elite. We do not need plans drawn up by a few for the few, or an enlightened or outspoken minority which claims to speak for everyone. It is about agreeing to live together, a social and cultural pact..."
Not much room there for that sordid Republic of Men, not Laws for which we are enjoined to abandon that fructifying "social and cultural pact" which is the market.
Francis goes on:
" is the responsibility of the State to safeguard and promote the common good of society. Based on the principles of subsidiarity and solidarity, and fully committed to political dialogue and consensus building, it plays a fundamental role, one which cannot be delegated, in working for the integral development of all. This role, at present, calls for profound social humility..."
Here, ultimately, is the root of all our woes. Not the "absolute autonomy of the marketplace and financial speculation", but the fact that none of those who hold sway over us – neither the unelected technocrats like Mario Draghi and Janet Yellen, the heads of our increasingly arbitrary governments – whether elective, theocratic, single-party socialistic, or monarchic in flavour – the sinister spymasters they have empowered to snoop and pry and curtain-twitch at our every thought and deed, nor the pettifogging officials they have let loose to harry us about our daily round – not one of them display much in the way of 'social humility', profound or otherwise.
Perhaps that's because most of these worthies have never had to operate within the one institution most likely to inculcate such a virtue; the one in which the consumer – and not the producer – is sovereign; the one where the customer – not the merchant – is always right.
I refer, of course, to the free, unhampered market – the bringer of bounty and promoter of peace, the forum of fraternity and congress of co-operation where man meets with man in order to trade, mine for yours, to the mutual benefit of both.

Stalwart economist of the anti-government Austrian school, Sean Corrigan has been thumbing his nose at the crowd ever since he sold Sterling for a profit as the ERM collapsed in autumn 1992. Former City correspondent for The Daily Reckoning, a frequent contributor to the widely-respected Ludwig von Mises and Cobden Centre websites, and a regular guest on CNBC, Mr.Corrigan is a consultant at Hinde Capital, writing their Macro Letter.

See the full archive of Sean Corrigan articles.

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