Capitalism Is Good and Good for You

By David Paul Deavel
Friday, June 22, 2012

‘Greed is not good.” Thank God somebody is finally challenging the right-wing defenders of capitalism. Except that this line comes from Father Robert Sirico, an arch-defender of free-market economics.

One of the more tedious but necessary duties of Christians and Jews today is to repeatedly explain to atheists that we do not believe in the same God they do not believe in. No, we say, an inflated oriental despot in the sky is not at all what we mean by God. That would not be a God worth worshiping or defending. Similarly tedious but necessary is the duty of defenders of free-market capitalism to point out to friends on the left that, no, we do not believe in the Gospel of Gordon Gekko, either. The case for a free economy must be made, as Arthur Brooks has recently written in National Review, on the basis of its moral foundations and not simply on its more efficient resource allocation.

In Defending the Free Market, Sirico, president of the Acton Institute, has delivered an accessible but sophisticated vademecum of explanations of why “capitalism” — meaning private property, contracts enforced by law, and a price and interest-rate system established by the mutual consent of the parties involved — is not only the best way to meet human needs but also reflects and relies upon the moral and creative aspects of human beings.

Father Sirico’s defense is partly autobiographical. His first chapter recounts his childhood in heavily immigrant Brooklyn and his youthful move to the West Coast, culminating in his becoming part of the leftist circles of Tom Hayden and Jane Fonda. He movingly recounts meeting various individuals outside the circle who challenged his rather fuzzy Marxist beliefs. One of his “aha” moments came while sitting in a cannabis-infused circle of leftists who were taking turns imagining what would happen “when the revolution comes.” When Sirico’s turn came, he uttered something like, “We’ll all be able to shop at Gucci.” To his explanation that Gucci was a metaphor for a society “where everyone will have access to quality goods and services,” a friend replied that he wasn’t “really a socialist.”

From that moment, Sirico continued to think about what kind of society he really did want and what part free markets played in it. He discovered that “capitalism” did have a competitive element surely, but that cooperation played just as much if not more of a role. As Sirico returned to his childhood Catholic faith, he realized a definite compatibility between the vision of humans assumed by free-market economics and the vision he had been taught in the catechesis of his youth. Made in God’s image, man is a free being who is creative and in mutually dependent relationships with others. Unlike the leftists he was leaving, Sirico realized that justice was indeed important — but so were mercy and charity.

It’s important to note two things about the religious aspect of this book. The first is that in contrast to Catholics on the left who imply that Democratic budgets (when Democrats actually produce them) are the natural outgrowth of the Nicene Creed, Sirico is not claiming a dogmatic status for any particular belief about free markets; he is only noting congruities between faith and free-market reasoning. Second, though very recognizably from a Catholic priest, his arguments are generally based on reason, and, where specifically theological, they are often Biblical and ecumenically accessible not only to other Christians but also to Jews.

But there is a whiff of the Baltimore Catechism in the book’s very structure. Each chapter begins with a question and an answer that summarize the chapter’s argument. Chapter 5 begins thus:

Q: Maybe socialism doesn’t work, but at least it’s idealistic. Capitalism may be the system that produces the most material wealth. But doesn’t laissez-faire mean capitulating to people’s baser instincts — just giving in to the notion that people are really motivated by nothing other than greed?

The questions are generally believable; I have been challenged with most of them in nearly identical wording. The short answers and the excursuses that follow are equally good. To the question above, Sirico gives a lucid explanation of what Adam Smith meant when he described capitalism as turning avaricious impulses to social goods: In a socialist system, the only option for the greedy is becoming “a thief or a cream-skimming government insider”; in a free economy, “the most efficient way for those people to pursue their disproportionate love of wealth is generally to subordinate themselves to the service of others” and start a useful business. Each chapter ends with a short list of further readings about the topics at hand.

What makes Sirico’s defense of a free economy all the stronger is his consistent acknowledgment that a functioning free market neither immanentizes the eschaton, making heaven on earth, nor makes a society virtuous or whole. Freedom of economic (and other) action is not the goal of society — acting virtuously in freedom is. And the intellectual and spiritual resources for virtuous action do not inhere in markets themselves. In his chapter on why state-sponsored health care is not really a compassionate answer, he writes against “the seduction that the power of economic freedom can in itself generate a system of health care marked by honesty and love.” Economic freedom must be accompanied by other kinds of freedom, particularly religious, and by people thinking about their duties toward the sick, the dying, and the poor. Homo economicus may be a useful abstraction for certain economics problems, but the human capital of love, loyalty, and sacrifice is the kind of capital required for a successful capitalism.

One can quibble with certain aspects of Father Sirico’s various discussions, but the overall effect of the book is an irenic invitation to see not only that “free markets work” but also why they work and under what conditions. From interest rates to the environment, this book is both accessible and meaty. Give it to your friends who think Gordon Gekko has something to do with you.