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IJ JUSTICE FORALL
Pastoral Letter on Catholic Social Teaching

and the liS Economy

National Conference of Catholic Bishops • Washington, D.C



FoUowing the November 1980 general meeting of
the National Conference

of Catholic Bishops, an ad hoc committee
was appointed to draft a pastoral

letter on the U.S. economy. The first draft
of this letter was submitted to

the bishops in November 1984, with subsequent
drafts presented and d^

cussed in November 1985 and June 1986.
Approval of the text by the ^y

of bishops was given during the plenary
assembly in Washmgton, D.C. m

November 1986. Accordingly, publication of
this pastoral letter, Econmtm

Justice for All: Catholic Social
Teaching and the U.S. Economy, is authorized by

the undersigned.

Monsignor Daniel F. Hoye

General Secretary

November 18, 1986
NCCB/USCC

Cover Design: Design Network, Inc.; Washington,
D.C

Excerpts from The Documents of Vatican II,
Walter M. Ab^tt, SJ, General

Editor; Copyri^t ® 1966, American Press,
Inc., 106 West 56th Street, New

York, N.Y. are reprinted with permission.
All rights reserved.

Excerpts from Vatican Council II: The
Conciliar and Post Conaliar Docw^ts,

Austin P. Flannery, ed. (CoUegeville,
Minn.: Liturgical Press, 1975) are

reprinted with permission. All rights
reserved.

Unless otherwise noted. Old Testament
scriptural excerpts in this^k are

from The New American Bible, copyright
© 1970, Confraternity of Chnsl^

Doctrine, Washington, D.C.; New Testament scriptural
excerpts are from

The New American Bible, copyright ® 1986, Confraternity
of Christian Doctnne,

Washington, D.C. Both are used with the permission
of the copynght owner.

ISBN 1-55586-101-6

Cop
3
rrlght 0 1986

United States Catholic Conference, Inc

Washington, D.C.

All rights reserved.



CONTENTS

A Pastoral Message: Economic Justice for All / v
Why We Write / vi
Principal Themes of the Pastoral Letter / ix
A Call to Conversion and Action / xiii

Economic Justice for All

Chapter 1: The Church and the Future of the
U.S. Economy / 1

A. The U.S. Economy Today: Memory and
Hope / 4

B. Urgent Problems of Today / 6
C. The Need for Moral Vision /II

Chapter II: The Christian Vision of Economic
Life / 15

A. Biblical Perspectives / 16

B. Ethical Norms for Economic Life / 32
C. Working for Greater Justice: Persons and

Institutions / 49

D. Christian Hope and the Courage To
Act / 62

Chapter III: Selected Economic Policy Issues / 65
A. Employment / 69

B. Poverty / 83

C. Food and Agriculture / 106

D. The U.S. Economy and the Developing
Nations: Complexity, Challenge and

Choices / 121

E. Conclusion / 142



Chapter IV: A New American Experiment:
Partnership for the Public Good / 145

A. Cooperation within Firms and

Industries / 147

B. Local and Regional Cooperation / 153

C. Partnership in the Development of

National Policies / 155

D. Cooperation at the International

Level / 160

Chapter V: A Commitment to the future / 163
A. The Christian Vocation in the World

Today / 164

B. Challenges to the Church / 170

C. The Road Ahead / 179

D. Commitment to a Kingdom of Love and

Justice / 181

Selected Bibliography / 185

Papal and Vatican Documents / 185

Collection and Commentaries / 186



A Pastoral Message

ECONOMIC JUSTICE FOR ALL

Brothers and Sisters in Christ:

1 . We are believers called to follow Our Lord Jesus
Christ and proclaim his Gospel in the midst of a com-

plex and powerful economy. This reality poses both

opportunities and responsibilities for Catholics in the

United States. Our faith calls us to measure this econ-

omy, not only by what it produces, but also by how

it touches human life and whether it protects or un-

dermines the dignity of the human person. Economic

decisions have human consequences and moral con-

tent; they help or hurt people, strengthen or weaken

family life, advance or diminish the quality of justice

in our land.

2. This is why we have written Economic Justice for
All: A Pastoral Letter on Catholic Social Teaching and the

U.S. Economy. This letter is a personal invitation to

Catholics to use the resources of our faith, the strength

of our economy, and the opportunities of our de-

mocracy to shape a society that better protects the

dignity and basic rights of our sisters and brothers,

both in this land and around the world.

3. The pastoral letter has been a work of careful

inquiry, wide consultation, and prayerful discern-

ment. The letter has been greatly enriched by this

V



process of listening and refinement. We offer this in-
troductory pastoral message to Catholics in the United

States seeking to live their faith in the marketplace

—

in homes, offices, factories, and schools; on farms and

ranches; in boardrooms and union halls; in service

agencies and legislative chambers. We seek to explain
why we wrote the pastoral letter, to introduce its ma-

jor themes, and to share our hopes for the dialogue

and action it might generate.

Why We Write

4. We write to share our teaching, to raise ques-
tions, to challenge one another to live our faith in the

world. We write as heirs of the biblical prophets who
summon us "to do the right, and to love goodness,
and to walk humbly with your God" (Mi 6:8). We
write as followers of Jesus who told us in the Sermon

on the Mount: "Blessed are the poor in spirit. . . .

Blessed are the meek. . . . Blessed are they who hun-

ger and thirst for righteousness. . . . You are the salt

of the earth. . . . You are the light of the world" (Mt

5:1-6,13-14). These words challenge us not only as

believers but also as consumers, citizens, workers,

and owners. In the parable of the Last Judgment, Jesus

said, "For I was hungry and you gave me food, I was

thirsty and you gave me drink. ... As often as you

did it for one of my least brothers, you did it for me"
(Mt 25:35-40). The challenge for us is to discover in

our own place and time what it means to be "poor in

spirit" and "the salt of the earth" and what it means

to serve "the least among us" and to "hunger and

thirst for righteousness."

5. Followers of Christ must avoid a tragic separa-

tion between faith and everyday life. They can neither

shirk their earthly duties nor, as the Second Vatican

VI



Council declared, "immerse [themjselves in earthly

activities as if these latter were utterly foreign to re-

ligion, and religion were nothing more than the ful-

fillment of acts of worship and the observance of a

few moral obligations" {Pastoral Constitution on the

Church in the Modern World, no. 43).

6. Economic life raises important social and moral

questions for each of us and for society as a whole.

Like family life, economic life is one of the chief areas

where we live out our faith, love our neighbor, con-

front temptation, fulfill God's creative design, and

achieve our holiness. Our economic activity in factory,

field, office, or shop feeds our families—or feeds our
anxieties. It exercises our talents—or wastes them. It
raises our hopes—or crushes them. It brings us into
cooperation with others—or sets us at odds. The Sec-
ond Vatican Council instructs us "to preach the mes-

sage of Christ in such a way that the light of the Gospel

will shine on all activities of the faithful" (Pastoral

Constitution, no. 43). In this case, we are trying to look

at economic life through the eyes of faith, applying

traditional church teaching to the U.S. economy.

7. In our letter, we write as pastors, not public

officials. We speak as moral teachers, not economic
technicians. We seek not to make some political or
ideological point but to lift up the human and ethical

dimensions of economic life, aspects too often ne-

glected in public discussion. We bring to this task a
dual heritage of Catholic social teaching and tradi-

tional American values.

8. As Catholics, we are heirs of a long tradition of

thought and action on the moral dimensions of eco-

nomic activity. The life and words of Jesus and the

teaching of his Church call us to serve those in need

and to work actively for social and economic justice.

As a community of believers, we know that our faith
is tested by the quality of justice among us, that we
can best measure our life together by how the poor

Vll



and the vulnerable are treated. This is not a new con-

cern for us. It is as old as the Hebrew prophets, as

compelling as the Sermon on the Mount, and as cur-

rent as the powerful voice of Pope John Paul II de-

fending the dignity of the human person.

9. As Americans, we are grateful for the gift of free-

dom and committed to the dream of "liberty and jus-

tice for all." This nation, blessed with extraordinary

resources, has provided an unprecedented standard

of living for millions of people. We are proud of the
strength, productivity, and creativity of our economy,

but we also remember those who have been left be-

hind in our progress. We believe that we honor our
history best by working for the day when all our sisters

and brothers share adequately in the American dream.

10. As bishops, in proclaiming the Gospel for these

times we also manage institutions, balance budgets,

meet payrolls. In this we see the human face of our

economy. We feel the hurts and hopes of our people.
We feel the pain of our sisters and brothers who are
poor, unemployed, homeless, living on the edge. The

poor and vulnerable are on our doorsteps, in our par-

ishes, in our service agencies, and in our shelters. We
see too much hunger and injustice, too much suffering

and despair, both in our own country and around the

world.

11. As pastors, we also see the decency, gener-

osity, and vulnerabUity of our people. We see the
struggles of ordinary families to make ends meet and

to provide a better future for their children. We know
the desire of managers, professionals, and business

people to shape what they do by what they believe.

It is the faith, good will, and generosity of our people

that gives us hope as we write this letter.



Principal Themes of the Pastoral

Letter

12. The pastoral letter is not a blueprint for the

American economy. It does not embrace any partic-

ular theory of how the economy works, nor does it

attempt to resolve the disputes between different

schools of economic thought. Instead, our letter turns

to Scripture and to the social teachings of the Church.

There, we discover what our economic life must serve,

what standards it must meet. Let us examine some

of these basic moral principles.

13. Every economic decision and institution must be

judged in light of whether it protects or undermines the

dignity of the human person. The pastoral letter begins

with the human person. We believe the person is
sacred—the clearest reflection of God among us. Hu-
man dignity comes from God, not from nationality,

race, sex, economic status, or any human accomplish-

ment. We judge any economic system by what it does
for and to people and by how it permits all to participate

in it. The economy should serve people, not the other

way around.

14. Human dignity can be realized and protected only

in community. In our teaching, the human person is

not only sacred but also social. How we organize our
society—in economics and politics, in law and pol-
icy—directly affects human dignity and the capacity
of individuals to grow in community. The obligation

to "love our neighbor" has an individual dimension,

but it also requires a broader social commitment to

the common good. We have many partial ways to
measure and debate the health of our economy: Gross

National Product, per capita income, stock market

prices, and so forth. The Christian vision of economic

life looks beyond them all and asks. Does economic

IX



life enhance or threaten our life together as a com-

munity?

15. All people have a right to participate in the economic

life of society. Basic justice demands that people be

assured a minimum level of participation in the econ-

omy. It is wrong for a person or group to be excluded

unfairly or to be unable to participate or contribute to

the economy. For example, people who are both able

and willing, but cannot get a job are deprived of the

participation that is so vital to human development.

For, it is through employment that most individuals

and families meet their material needs, exercise their

talents, and have an opportunity to contribute to the

larger community. Such participation has a special

significance in our tradition because we believe that

it is a means by which we join in carrying forward

God's creative activity.

16. All members of society have a special obligation to

the poor and vulnerable. From the Scriptures and church

teaching, we learn that the justice of a society is tested

by the treatment of the poor. The justice that was the

sign of God's covenant with Israel was measured by

how the poor and unprotected—the widow, the or-
phan, and the stranger—were treated. The kingdom
that Jesus proclaimed in his word and ministry ex-

cludes no one. Throughout Israel's history and in early

ChrisHanity, the poor are agents of God's transform-

ing power. "The Spirit of the Lord is upon me, there-

fore he has anointed me. He has sent me to bring glad

tidings to the poor"(Lk 4:18). This was Jesus' first

public utterance. Jesus takes the side of those most

in need. In the Last Judgment, so dramatically de-

scribed in St. Matthew's Gospel, we are told that we

will be judged according to how we respond to the

hungry, the thirsty, the naked, the stranger. As fol-

lowers of Christ, we are challenged to make a fun-

damental "option for the poor"—to speak for the
voiceless, to defend the defenseless, to assess life

X



styles, policies, and social institutions in terms of their

impact on the poor. This "option for the poor" does

not mean pitting one group against another, but rather,

strengthening the whole community by assisting those

who are most vulnerable. As Christians, we are called

to respond to the needs of all our brothers and sisters,

but those with the greatest needs require the greatest

response.

17. Human rights are the minimum conditions for life

in community. In Catholic teaching, human rights in-

clude not only civil and political rights but also eco-

nomic rights. As Pope John XXIII declared, "all people

have a right to life, food, clothing, shelter, rest, med-

ical care, education, and employment." This means

that when people are without a chance to earn a living,

and must go hungry and homeless, they are being

denied basic rights. Society must ensure that these

rights are protected. In this way, we will ensure that

the minimum conditions of economic justice are met

for all our sisters and brothers.

18. Society as a whole, acting through public and private

institutions, has the moral responsibility to enhance human

dignity and protect human rights. In addition to the clear

responsibility of private institutions, government has

an essential responsibility in this area. This does not

mean that government has the primary or exclusive

role, but it does have a positive moral responsibility

in safeguarding human rights and ensuring that the

minimum conditions of human dignity are met for

all. In a democracy, government is a means by which

we can act together to protect what is important to

us and to promote our common values.

19. These six moral principles are not the only ones

presented in the pastoral letter, but they give an over-

view of the moral vision that we are trying to share.

This vision of economic life cannot exist in a vacuum;

it must be translated into concrete measures. Our pas-

toral letter spells out some specific applications of

XI



Catholic moral principles. We call for a new national
commitment to full employment. We say it is a social
and moral scandal that one of every seven Americans

is poor, and we call for concerted efforts to eradicate

poverty. The fulfillment of the basic needs of the poor

is of the highest priority. We urge that all economic
policies be evaluated in light of their impact on the

life and stability of the family. We support measures
to halt the loss of family farms and to resist the grow-

ing concentration in the ownership of agricultural re-

sources. We specify ways in which the United States
can do far more to relieve the plight of poor nations

and assist in their development. We also reaffirm
church teaching on the rights of workers, collective

bargaining, private property, subsidiarity, and equal

opportunity.

20. We believe that the recommendations in our
letter are reasonable and balanced. In analyzing the

economy, we reject ideological extremes and start from

the fact that ours is a "mixed" economy, the product

of a long history of reform and adjustment. We know
that some of our specific recommendations are con-

troversial. As bishops, we do not claim to make these

prudential judgments with the same kind of authority

that marks our declarations of principle. But, we feel

obliged to teach by example how Christians can un-

dertake concrete analysis and make specific judg-

ments on economic issues. The Church's teachings

cannot be left at the level of appealing generalities.

21. In the pastoral letter, we suggest that the time

has come for a "New American Experiment"—to im-
plement economic rights, to broaden the sharing of

economic power, and to make economic decisions

more accountable to the common good. This experi-

ment can create new structures of economic partner-

ship and participation within firms at the regional

level, for the whole nation, and across borders.

xii



22. Of course, there are many aspects of the econ-

omy the letter does not touch, and there are basic

questions it leaves to further ejtploration. There are

also many specific points on which men and women

of good will may disagree. We look for a fruitful ex-
change among differing viewpoints. We pray only
that all will take to heart the urgency of our concerns;

that together we will test our views by the Gospel and

the Church's teaching; and that we will listen to other

voices in a spirit of mutual respect and open dialogue.

A Call to Conversion and Action

23. We should not be surprised if we find Catholic
social teaching to be demanding. The Gospel is de-

manding. We are always in need of conversion, of a
change of heart. We are richly blessed, and as St. Paul
assures us, we are destined for glory. Yet, it is also

true that we are sinners; that we are not always wise

or loving or just; that, for all our amazing possibilities,

we are incompletely bom, wary of life, and hemmed

in by fears and empty routines. We are unable to
entrust ourselves fully to the living God, and so we

seek substitute forms of security in material things,

in power, in indifference, in popularity, in pleasure.

The Scriptures warn us that these things can become

forms of idolatry. We know that, at times, in order to
remain truly a community of Jesus' disciples, we will

have to say "no" to certain aspects in our culture, to

certain trends and ways of acting that are opposed to

a life of faith, love, and justice. Changes in our hearts

lead naturally to a desire to change how we act. With

what care, human kindness, and justice do I conduct

myself at work? How will my economic decisions to
buy, sell, invest, divest, hire, or fire serve human

dignity and the common good? In what career can I



best exercise my talents so as to fill the world with
the Spirit of Christ? How do my economic choices
contribute to the strength of my family and com-
munity, to the values of my children, to a sensitivity
to those in need? In this consumer society, how can

I develop a healthy detachment from things and avoid

the temptation to assess who I am by what I have?

How do I strike a balance between labor and leisure
that enlarges my capacity for friendships, for family
life, for community? What government policies should

I support to attain the well-being of all, especially the

poor and vulnerable?

24. The answers to such questions are not always

clear—or easy to live out. But, conversion is a lifelong
process. And, it is not undertaken alone. It occurs

with the support of the whole believing community,

through baptism, common prayer, and our daily ef-

forts, large and small, on behalf of justice. As a Church,

we must be people after God's own heart, bonded by

the Spirit, sustaining one another in love, setting our

hearts on God's kingdom, committing ourselves to

solidarity with those who suffer, working for peace

and justice, acting as a sign of Christ's love and justice

in the world. The Church cannot redeem the world

from the deadening effects of sin and injustice unless

it is working to remove sin and injustice in its own

life and institutions. AU of us must help the Church

to practice in its own life what it preaches to others

about economic justice and cooperation.

25. The challenge of this pastoral letter is not merely

to think differently, but also to act differently. A re-
newal of economic life depends on the conscious

choices and commitments of individual believers who

practice their faith in the world. The road to holiness

for most of us lies in our secular vocations. We need
a spirituality that calls forth and supports lay initiative

and witness not just in our churches but also in busi-

ness, in the labor movement, in the professions, in

XIV



education, and in public life. Our faith is not just a

weekend obligation, a mystery to be celebrated around

the altar on Sunday. It is a pervasive reality to be

practiced every day in homes, offices, factories,

schools, and businesses across our land. We cannot
separate what we believe from how we act in the

marketplace and the broader community, for this is

where we make our primary contribution to the pur-

suit of economic justice.

26. We ask each of you to read the pastoral letter,
to study it, to pray about it, and match it with your

own experience. We ask you to join with us in service
to those in need. Let us reach out personally to the

hungry and the homeless, to the poor and the pow-

erless, and to the troubled and the vulnerable. In

serving them, we serve Christ. Our service efforts

cannot substitute for just and compassionate public

policies, but they can help us practice what we preach

about human life and human dignity.

27. The pursuit of economic justice takes believers

into the public arena, testing the policies of govern-

ment by the principles of our teaching. We ask you
to become more informed and active citizens, using

your voices and votes to speak for the voiceless, to

defend the poor and the vulnerable and to advance

the common good. We are called to shape a constit-
uency of conscience, measuring every policy by how

it touches the least, the lost, and the left-out among

us. This letter calls us to conversion and common

action, to new forms of stewardship, service, and cit-

izenship.

28. The completion of a letter such as this is but

the beginning of a long process of education, discus-

sion, and action. By faith and baptism, we are fash-

ioned into new creatures, filled with the Holy Spirit

and with a love that compels us to seek out a new

profound relationship with God, with the human fam-
ily, and with all created things. Jesus has entered our

XV



history as God's anointed son who announces the

coming of God's kingdom, a kingdom of justice and

peace and freedom. And, what Jesus proclaims, he

embodies in his actions. His ministry reveals that the

reign of God is something more powerful than evil,

injustice, and the hardness of hearts. Through his

crucifixion and resurrection, he reveals that God's love

is ultimately victorious over all suffering, all horror,

all meaninglessness, and even over the mystery of

death. Thus, we proclaim words of hope and assur-

ance to all who suffer and are in need.

29. We believe that the Christian view of life, in-
cluding economic life, can transform the lives of in-

dividuals, families, schools, and our whole culture.

We believe that with your prayers, reflection, service,
and action, our economy can be shaped so that human

dignity prospers and the human person is served. This

is the unfinished work of our nation. This is the chal-

lenge of our faith.

XVI



Chapter I

THE CHURCH AND THE FUTURE
OF THE U.S. ECONOMY

1. Every perspective on economic life that is hu-

man, moral, and Christian must be shaped by three

questions: What does the economy do for people?

What does it do to people? And how do people par-

ticipate in it? The economy is a human reality: men

and women working together to develop and care for

the whole of God's creation. All this work must serve

the material and spiritual well-being of people. It in-

fluences what people hope for themselves and their

loved ones. It affects the way they act together in

society. It influences their very faith in God.*

2. The Second Vatican Council declared that "the

joys and hopes, the griefs and anxieties of the people

of this age, especially those who are poor or in any
way afflicted, these too are the joys and hopes, the

griefs and anxieties of the followers of Christ."^ TTtere

are many signs of hope in U.S. economic life today:

^ Vatican Council II, The Pastoral Constitution on the Church in the

Modem World, 33. [Note: This pastoral letter frequently refers to

documents of the ^ond Vatican Council, papal encyclicals, and
other official teachings of the Roman Catholic Church. Most of

these texts have been published by the United States Catholic Con-

ference Office of Publishing and Promotion Services; many are
available in collections, though no single collection is comprehen-

sive. See Selected Bibliography.]

^ Pastoral Constitution, 1.

1



• Many fathers and mothers skillfully balance the

arduous responsibilities of work and family life.

There are parents who pursue a purposeful and

modest way of life and by their example en-

courage their children to follow a similar path.

A large number of women and men, drawing on
their religious tradition, recognize the chaUeng-

ing vocation of family life and child rearing in a

culture that emphasizes material display and self-

gratification.

• Conscientious business people seek new and

more equitable ways to organize resources and

the workplace. They face hard choices over ex-

panding or retrenching, shifting investments,

hiring or firing.

• Young people choosing their life's work ask

whether success and security are compatible with

service to others.

• Workers whose labor may be toilsome or repet-

itive try daUy to ennoble their work with a spirit

of solidarity and friendship.

• New immigrants brave dislocations while hoping
for the opportunities realized by the nullions who

came before them.

3. These signs of hope are not the whole story.

There have been failures—some of them massive and
ugly:

• Poor and homeless people sleep in community

shelters and in our church basements; the hun-

gry line up in soup lines.

• Unemployment gnaws at the self-respect of both

middle-aged persons who have lost jobs and the

young who cannot find them.
• Hardworking men and women wonder if the

system of enterprise that helped them yesterday

might destroy their jobs and their communities

tomorrow

2



• Families confront major new challenges: dwin-

dling social supports for family stability; eco-

nomic pressures that force both parents of young

children to work outside the home; a driven pace

of life among the successful that can sap love and

commitment; lack of hope among those who have

less or nothing at all. Very different kinds of

families bear different burdens of our economic

system.

• Farmers face the loss of their land and way of

life; young people find it difficult to choose farm-

ing as a vocation; farming communities are

threatened; migrant farmworkers break then-

backs in serf-like conditions for disgracefully low

wages.

4. And beyond our own shores, the reality of800 million

people living in absolute poverty and 450 million mal-

nourished or facing starvation casts an ominous shadow

over all these hopes and problems at home.

5. Anyone who sees all this will understand our

concern as pastors and bishops. People shape the

economy and in turn are shaped by it. Economic ar-

rangements can be sources of fulfillment, of hope, of

community—or of frustration, isolation, and even de-
spair. They teach virtues—or vices—and day by day
help mold our characters. They affect the quality of

people's lives; at the extreme even determining

whether people live or die. Serious economic choices

go beyond purely technical issues to fundamental

questions of value and human purpose.* We believe
that in facing these questions the Christian religious

and moral tradition can make an important contri-

bution.

* See ibid. , 10, 42, 43; Congregation for the Doctrine of the Faith,

Instruction on Christian Freedom and Liberation, (Washington, D.C.:

USCC Office of Publishing and Promotion Services, 1986), 34-36.

3



A. The U.S. Economy Today:

Memory and Hope

6. The United States is among the most econom-

icaUy powerful nations on earth. In its short history

the U.S. economy has grown to provide an unprec-

edented standard of living for most of its people. The

nation has created productive work for millions of

immigrants and enabled them to broaden their free-

doms, improve their families' quality of life, and con-

tribute to the building of a great nation. Those who

came to this country from other lands often under-

stood their new lives in the light of biblical faith. They

thought of themselves as entering a promised land of

political freedom and economic opportunity. The

United States is a land of vast natural resources and

fertile soil. It has encouraged citizens to undertake bold

ventures. Through hard work, self-sacrifice, and co-

operation, families have flourished; towns, cities, and

a powerful nation have been created.

7. But we should recall this history with sober hu-

mility. The American experiment in social, political,

and economic life has involved serious conflict and

suffering. Our nation was bom in the face of injustice

to native Americans, and its independence was paid

for with the blood of revolution. Slavery stained the

commercial life of the land through its first two

hundred and fifty years and was ended only by a

violent civil war. The establishment of women's suf-

frage, the protection of industrial workers, the elim-

ination of child labor, the response to the Great

Depression of the 1930s, and the civil rights movement

of the 1960s all involved a sustained struggle to trans-

form the political and economic institutions of the

nation.

8. The U.S. value system emphasizes economic

freedom. It also recognizes that the market is limited

4



by fundamental human rights. Some things are never

to be bought or sold." This conviction has prompted

positive steps to modify the operation of the market

when it harms vulnerable members of society. Labor

unions help workers resist exploitation. Through their

government, the people of the United States have

provided support for education, access to food, un-

employment compensation, security in old age, and

protection of the environment. The market system

contributes to the success of the U. S. economy, but

so do many efforts to forge economic institutions and

public policies that enable all to share in the riches of

the nation. The country's economy has been built

through a creative struggle; entrepreneurs, business

people, workers, unions, consumers, and govern-

ment have all played essential roles.

9. The task of the United States today is as de-

manding as that faced by our forebears. Abraham

Lincoln's words at Gettysburg are a reminder that

complacency today would be a betrayal of our nation's

history: "It is for us, the living, rather to be dedicated

here to the unfinished work . . . they have thus far

nobly advanced."® There is unfinished business in the

American experiment in freedom and justice for all.

*
See Pope John Paul II, On Human Work (1981), 14; and Pope

Paul VI, Octogesima Adveniens (1971), 35. See also Arthur Okun,

Equality and Efficierwy: The Big Tradeoff (Washington, D.C.: The

Brookings Institution, 1975), ch. 1; Michael Walzer, Spheres ofJustice:

A Defense of Pluralism and Equality (New York: Basic Books, 1983),
ch. 4; Jon P. Gunnemann, "Capitalism and Commutative Justice,"

paper presented at the 1985 meeting of the Society of Christian

Ethics.

* Abraham Lincoln, Address at Dedication of National Cemetery

at Gettysburg, November 19, 1863.

5



B. Urgent Problems of Today

10. The preeminent role of the United States in an

increasingly interdependent global economy is a cen-

tral sign of our times.* The United States is still the

world's economic giant. Decisions made here have

immediate effects in other countries; decisions made

abroad have immediate consequences for steelwork-

ers in Pittsburgh, oil company employees in Houston,

and farmers in Iowa. U.S. economic growth is vitally

dependent on resources from other countries and on

their purchases of our goods and services. Many jobs

in U.S. industry and agriculture depend on our ability

to export manufactured goods and food.

11. In some industries the mobility of capital and

technology makes wages the main variable in the cost

of production. Overseas competitors with the same

technology but with wage rates as low as one-tenth

of ours put enormous pressure on U.S. firms to cut

wages, relocate abroad, or close. U.S. workers and

their communities should not be expected to bear these

burdens alone.

12. All people on this globe share a common eco-

logical environment that is under increasing pressure.

Depletion of soil, water, and other natural resources

endangers the future. Pollution of air and water

threatens the delicate balance of the biosphere on

which future generations will depend.^ The resources

of the earth have been created by God for the benefit

of all, and we who are alive today hold them in trust.

This is a challenge to develop a new ecological ethic

that will help shape a future that is both just and

sustainable.

'' Pope John XXIlh Peace on Earth (1963), 130-131.

^ Synod of Bishops, justice in the World (1971), 8; Pope John Paul

II, Redeemer of Man (1979), 15.

6



13. In short, nations separated by geography, cul-

ture, and ideology are linked in a complex commercial,

financial, technological, and environmental network.

These links have two direct consequences. First, they

create hope for a new form of community among all

peoples, one built on dignity, solidarity, and justice.

Second, this rising global awareness calls for greater

attention to the stark inequities across countries in the

standards of living and control of resources. We must
not look at the welfare of U.S. citizens as the only

good to be sought. Nor may we overlook the dispar-

ities of power in the relationships between this nation

and the developing countries. The United States is

the major supplier of food to other countries, a major

source of arms sales to developing nations, and a

powerful influence in multilateral institutions such as

the International Monetary Fund, the World Bank,

and the United Nations. What Americans see as a

growing interdependence is regarded by many in the

less developed countries as a pattern of domination

and dependence.

14. Within this larger international setting, there

are also a number of challenges to the domestic econ-

omy that call for creativity and courage. The promise

of the "American dream"—freedom for all persons to
develop their God-given talents to the full—remains
unfulfilled for millions in the United States today.

15. Several areas of U.S. economic life demand spe-

cial attention. Unemployment is the most basic. De-

spite the large number of new jobs the U.S. economy

has generated in the past decade, approximately 8

million people seeking work in this country are unable

to find it, and many more are so discouraged they

have stopped looking.” Over the past two decades the

nation has come to tolerate an increasing level of un-

' U.S. Department of Labor, Bureau of Labor Statistics, The Em-

ployment Situation: August 1985 (September 1985), Table A-1.

7



employment. The 6 to 7 percent rate deemed accept-

able today would have been intolerable twenty years

ago. Among the unemployed are a disproportionate

number of blacks, Hispanics, young people, or women

who are the sole support of their families.’ Some cities

and states have many more unemployed persons than

others as a result of economic forces that have little

to do with people's desire to work. Unemployment

is a tragedy no matterwhom it strikes, but the tragedy

is compounded by the unequal and unfair way it is

distributed in our society.

16. Harsh poverty plagues our country despite its

great wealth. More than 33 million Americans are

poor; by any reasonable standard another 20 to 30

million are needy. Poverty is increasing in the United

States, not decreasing.'® For a people who believe in

"progress," this should be cause for alarm. These bur-

dens fall most heavily on blacks, Hispanics, and Na-

tive Americans. Even more disturbing is the large

increase in the number of women and children living

in poverty. Today children are the largest single group

among the poor. This tragic fact seriously threatens

the nation's future. That so many people are poor in

a nation as rich as ours is a social and moral scandal

that we cannot ignore.

17. Many working people and middle-class Amer-

icans live dangerously close to poverty . A rising num-

ber of families must rely on the wages of two or even

three members just to get by. From 1968 to 1978 nearly

a quarter of the U. S. population was in poverty part

of the time and received welfare benefits in at least

’ Ibid.

U.S. Bureau of the Census, Current Population Reports,
Senes

P-60, 145, Money Income and Poverty Status of Families and
Persons in

the United States: 1983 (Washington, D.C.; U.S.
Government Print-

ing Office, 1984), 20.

8



one year." The loss of a job, illness, or the breakup

of a marriage may be all it takes to push people into
poverty.

18. The lack of a mutually supportive relation be-
tween family life and economic life is one of the most

serious problems facing the United States today. The
economic and cultural strength of the nation is directly

linked to the stability and health of its families. When
families thrive, spouses contribute to the common
good through their work at home, in the community,
and in their jobs; and children develop a sense of their
own worth and of their responsibility to serve others.
When families are weak or break down entirely, the
dignity of parents and children is threatened. High
cultural and economic costs are inflicted on society at
large.

19. The precarious economic situation of so many
people and so many families calls for examination of
U.S. economic arrangements. Christian conviction and
the American promise of liberty and justice for all give
the poor and the vulnerable a special claim on the
nation's concern. They also challenge all members of
the Church to help build a more just society.

20. The investment of human creativity and ma-
terial resources in the production of the weapons of
war makes these economic problems even more dif-
ficult to solve. Defense Department expenditures in
the United States are almost $300 billion per year. The
rivalry and mutual fear between superpowers divert
into projects that threaten death, minds, and money
that could better human life. Developing countries
engage in arms races they can ill afford, often with
the encouragement of the superpowers. Some of the

" Greg H. Duncan, Years of Poverty, Years of Plenty: The Changing
Economic Fortunes ofAmerican Workers and Their Families (Ann Arbor,
Mich.: Institute for Social Research, University of Michigan, 1984).

See Pope John Paul II, Familiaris Consortia (1981), 46.
“ Pastoral Constitution, 47.

9



poorest countries of the world use scarce resources to

buy planes, guns, and other weapons when they lack

the food, education, and health care their people need.

Defense policies must be evaluated and assessed in

light of their real contribution to freedom, justice, and

peace for the citizens of our own and other nations.

We have developed a perspective on these multiple

moral concerns in our 1983 pastoral letter. The Chal-

lenge of Peace: God's Promise and Our Response.'*
When

weapons or strategies make questionable contribu-

tions to security, peace, and justice and will also be

very expensive, spending priorities should be redi-

rected to more pressing social needs.'®

21. Many other social and economic challenges re-

quire careful analysis: the movement of many indus-

tries from the Snowbelt to the Sunbelt, the federal

deficit and interest rates, corporate mergers and take-

overs, the effects of new technologies such as robotics

and information systems in U.S. indus^, immigra-

tion policy, growing international traffic in drugs, and

the trade imbalance. All of these issues do not provide

a complete portrait of the economy. Rather they are

symptoms of more fundamental currents shaping U.S.

economic life today: the struggle to find meaning and

value in human work, efforts to support individual

freedom in the context of renewed social cooperation,

the urgent need to create equitable forms of global

interdependence in a world now marked by extreme

inequality. These deeper currents are cultural and

moral in content. They show that the long-range chal-

lenges facing the nation call for sustained reflection

National Conference of Catholic Bishops, The Challenge of Peace:

God's Promise and Our Response (Washington, D.C.; USCC Office of

Publishing and Promotion Services, 19&).

'* Cardinal Joseph L. Bernardin and Cardinal John J. O'Connor,

Testimony before the House Foreign Relations Committee, June

26, 1984, Origins 14:10 (August 10, 1984): 157.

10



on the values that guide economic choices and are

embodied in economic institutions. Such explicit re-

flection on the ethical content of economic choices and

policies must become an integral part of the way

Christians relate religious belief to the realities of

everyday life. In this way, the "split between the faith

which many profess and their daily lives,"'*’ which

Vatican II counted among the more serious errors of

the modem age, will begin to be bridged.

C. The Need for Moral Vision

22. Sustaining a common culture and a common

commitment to moral values is not easy in our world.

Modern economic life is based on a division of labor

into specialized jobs and professions. Since the in-

dustrial revolution, people have had to define them-

selves and their work ever more narrowly to find a

niche in the economy. The benefits of this are evident

in the satisfaction many people derive from contrib-

uting their specialized skills to society. But the costs

are social fragmentation, a decline in seeing how one's

work serves the whole community, and an increased

emphasis on personal goals and private interests.'^

This is vividly clear in discussions of economic justice.

Here it is often difficult to find a common ground

among people with different backgrounds and con-

cerns. One of our chief hopes in writing this letter is

to encourage and contribute to the development of

this common ground.'*

'** Pastoral Constitution, 43.

See, for example, Peter Berger, Brigitte Berger, and Hansfried

Kellner, The Homeless Mind: Modernization and Consciousness (New

York: Vintage, 1974).

For a recent study of the importance and difficulty of achieving

such a common language and vision see Robert N. Bellah, Richard

11



23. Strengthening common moral vision is essen-

tial if the economy is to serve all people more fairly.

Many middle-class Americans feel themselves in the

grip of economic demands and cultural pressures that

go far beyond the individual family's capacity to cop»e.

Without constructive guidance in maldng decisions

with serious moral implications, men and women who

hold positions of responsibility in corporations or gov-

ernment find their duties exacting a heavy price. We

want these reflections to help them contribute to a

more just economy.

24. The quality of the national discussion about our

economic future will affect the poor most of all, in this

country and throughout the world. The life and dig-

nity of millions of men, women, and children hang

in the balance. Decisions must be judged in light of

what they do for the poor, what they do to the poor,

and what they enable the poor to do for themselves.

The fundamental moral criterion for all economic de-

cisions, policies, and institutions is this: They must

be at the service of all people, especially the poor.

25. This letter is based on a long tradition of Cath-

olic social thought, rooted in the Bible and developed

over the past century by the popes and the Second

Vatican Council in response to modern economic con-

ditions. This tradition insists that human dignity, re-

alized in community with others and with the whole

of God's creation, is the norm against which every

social institution must be measured.”

26. This teaching has a rich history. It is also dy-

namic and growing.^ Pope Paul VI insisted that all

Madsen, William M. Sullivan, Ann Swidler, and Stephen M. Tip-

ton, Habits of the Heart: Individualism and Commitment in American

Life (Berkeley, Calif.: University of California Press, 1985). See also

Martin E. Marty, The Public Church (New York: Crossroads, 1981).

Pope John XXIIl, Mater et Magistra (1961), 219; Pastoral Con-

stitution, 40.

“ Congregation for the Doctrine of the Faith, Instruction on Cer-

12



Christian communities have the responsibility "to

analyze with objectivity the situation which is proper

to their own country, to shed on it the light of the

Gospel's unalterable words and to draw principles of

reflection, norms of judgment, and directives for ac-

tion from the social teaching of the Church."^’ There-

fore, we build on the past work of our own bishops'

conference, including the 1919 Program of Social Re-

construction and other pastoral letters.“ In addition

many people from the Catholic, Protestant, and Jew-

ish communities, in academic, business or political

life, and from many different economic backgrounds

have also provided guidance. We want to make the
legacy of Christian social thought a living, growing

resource that can inspire hope and help shape the

future.

27. We write, then, first of all to provide guidance
for members of our own Church as they seek to form

their consciences about economic matters. No one

may claim the name Christian and be comfortable in

the face of the hunger, homelessness, insecurity, and

injustice found in this country and the world. At the

same time, we want to add our voice to the public

debate about the directions in which the U.S. economy

should be moving. We seek the cooperation and sup-
port of those who do not share our faith or tradition.

tain Aspects of the Theology of Liberation (Washington, D.C.: USCC

Office of Publishing and Promotion Services, 1984); Pope Paul VI,

Octogesima Adveniens (1971), 42.

Octogesima Adveniens, 4.

° Administrative Committee of the National Catholic War

Council, Program of Social Reconstruction, February 12, 1919. Other

notable statements on the economy by our predecessors are The

Present Crisis, April 25, 1933; Statement on Church and Social Order,

February 4, 1940; The Economy: Human Dimensions, November 20,

1975. These and numerous other statements of the U.S. Catholic

episcopate can be found in Hugh J. Nolan, ed.. Pastoral Letters of
the United States Catholic Bishops, 4 vols. (Washington, D.C.: USCC
Office of Publishing and Promotion Services, 1984).

13



The common bond of humanity that links all persons

is the source of our belief that the country can attain

a renewed public moral vision. The questions are basic

and the answers are often elusive; they challenge us

to serious and sustained attention to economic justice.

14



Chapter II

THE CHRISTIAN VISION OF
ECONOMIC LIFE

28. The basis for all that the Church believes about

the moral dimensions of economic life is its vision of

the transcendent worth—the sacredness—of human
beings. The dignity of the human person, realized in com-

munity with others, is the criterion against which all aspects

of economic life must be measured.' All human beings,

therefore, are ends to be served by the institutions

that make up the economy, not means to be exploited

for more narrowly defined goals. Human personhood

must be respected with a reverence that is religious.

When we deal with each other, we should do so with

the sense of awe that arises in the presence of some-

thing holy and sacred. For that is what human beings

are: we are created in the image of God (Gn 1:2^.

Similarly, all economic institutions must support the

bonds of community and solidarity that are essential

to the dignity of persons. Wherever our economic

arrangements fail to conform to the demands of hu-

man dignity lived in community, they must be ques-

tioned and transformed. These convictions have a

biblical basis. They are also supported by a long tra-

dition of theological and philosophical reflection and

through the reasoned analysis of human experience

by contemporary men and women.

' Mater et Magistra, 219-220. See Pastoral Constitution, 63.

15



29. In presenting the Christian moral vision, we

turn first to the Scriptures for guidance. Though our

comments are necessarily selective, we hope that pas-

tors and other church members will become person-

ally engaged with the biblical texts. The Scriptures

contain many passages that speak directly of economic

life. We must also attend to the Bible's deeper vision

of God, of the purpose of creation, and of the dignity

of human life in society. Along with other churches

and ecclesial communities who are "strengthened by

the grace of Baptism and the hearing of God's Word,"

we strive to become faithful hearers and doers of the

word.^ We also claim the Hebrew Scriptures as com-

mon heritage with our Jewish brothers and sisters,

and we join with them in the quest for an economic

life worthy of the divine revelation we share.

A. Biblical Perspectives

30. The fundamental conviction of our faith is that

human life is fulfilled in the knowledge and love of

the living God in communion with others. The Sacred

Scriptures offer guidance so that men and women may

enter into full communion with God and with each

other, and witness to God's saving acts. We discover

there a God who is creator of heaven and earth, and

of the human family. Though our first parents reject

the God who created them, God does not abandon

them, but from Abraham and Sarah forms a people

of promise. When this people is enslaved in an alien

land, God delivers them and makes a covenant with

them in which they are summoned to be faithful to

the torah or sacred teaching. The focal points of Israel's

faith—creation, covenant, and community—provide

^ Vatican Council II, Decree on Ecumenism, 22-23.

16



a foundation for reflection on issues of economic and
social justice.

1. Created in God's Image

31. After the exile, when Israel combined its tra-
ditions into a written torah, it prefaced its history as
a people with the story of the creation of all peoples
and of the whole world by the same God who created
them as a nation (Gn Ml). God is the creator of
heaven and earth (Gn 14:19-22; Is 40:28; 45:18); cre-
ation proclaims God's glory (Ps 89:6-12) and is "very
good" (Gn 1:31). Fruitful harvests, bountiful flocks, a
loving family are God's blessings on those who heed
God's word. Such is the joyful refrain that echoes
throughout the Bible. One legacy of this theology of
creation is the conviction that no dimension of human
life lies beyond God's care and concern. God is present
to creation, and creative engagement with God's han-
diwork is itself reverence for God.

32. At the summit of creation stands the creation
of man and woman, made in God's image (Gn 1:26-
27). As such every human being possesses an inalienable
dignity that stamps human existence prior to any division
into races or nations and prior to human labor and human
achievement (Gn 4-11). Men and women are also to
share in the creative activity of God. They are to be
fruitful, to care for the earth (Gn 2:15), and to have
^^dominion over it (Gn 1:28), which means they are
"to govern the world in holiness and justice and to
render judgment in integrity of heart" (Wis 9:3). Cre-
ation is a gift; women and men are to be faithful
stewards in caring for the earth. They can justly con-
sider that by their labor they are unfolding the Cre-
ator's work.^

’ C. Westermann, Creation (Philadelphia: Fortress Press, 1974);
and B. Vawter, On Genesis: A New Reading (Garden City, N.Y.:
Doubleday, 1977). See also Pastoral Constitution, 34.

17



33. The narratives of Genesis 1-11 also portray the

origin of the strife and suffering that mar the world.

Though created to enjoy intimacy with God and the

fruits of the earth, Adam and Eve disrupted God's
design by trying to live independently of God through

a denial of their status as creatures. Tliey turned away

from God and gave to God's creation the obedience

due to God alone. For this reason the prime sin in so

much of the biblical tradition is idolatry: service of the

creature rather than of the creator (Rom 1:25), and the

attempt to overturn creation by making God in human

likeness. The Bible castigates not only the worship of

idols, but also manifestations of idolatry, such as the

quest for unrestrained power and the desire for great

wealth (Is 40:12-20; 44:1-20; Wis 13:1-14:31; Col 3:5,

"the greed that is idolatry"). The sin of our first parents

had other consequences as well. Alienation from God

pits brother against brother (Gn 4:8-16), in a cycle of

war and vengeance (Gn 4:22-23). Sin and evil abound,

and the primeval history culminates with another as-

sault on the heavens, this time ending in a babble of

tongues scattered over the face of the earth (Gn 11:1-

9). Sin simultaneously alienates human beings from

God and shatters the solidarity of the human com-

munity. Yet this reign of sin is not the final word.

The primeval history is followed by the call of Abra-

ham, a man of faith, who was to be the bearer of the

promise to many nations (Gn 12:1-4). Throughout the

Bible we find this struggle between sin and repent-

ance. God's judgment on evil is followed by God's

seeking out a sinful people.

34. The biblical vision of creation has provided one

of the most enduring legacies of Church teaching. To

stand before God as the creator is to respect God's

creation, both the world of nature and of human his-

tory. From the patristic period to the present, the Church

has affirmed that misuse of the world's resources or appro-

priation of them by a minority of the world's population

18



betrays the gift of creation since "whatever belongs to God
belongs to all."*

2 . A People of the Covenant

35. When the people of Israel, our forerunners in
faith, gathered in thanksgiving to renew their cove-
nant (Jos 24:1-15), they recalled the gracious deeds of

God (Dt 6:20-25; 26: 5-11). When they lived as aliens
in a strange land and experienced oppression and
slavery, they cried out. The Lord, the God of their
ancestors, heard their cries, knew their afflictions, and
came to deliver them (Ex 3:7-8). By leading them out
of Egypt, God created a people that was to be the
Lord's very own (Jer 24:7; Hos 2:25). They were to
imitate God by treating the alien and the slave in their
midst as God had treated them (Ex 22:20-22; Jer 34:8-
14).

36. In the midst of this saving history stands the

covenant at Sinai (Ex 19-24). It begins with an account
of what God has done for the people (Ex 19:1-6; cf.
Jos 24:1-13) and includes from God's side a promise
of steadfast love (hesed) and faithfulness (’emeth, Ex
34:5-7). The people are summoned to ratify this cov-
enant by faithfully worshiping God alone and by di-
recting their lives according to God's will, which was
made explicit in Israel's great legal codes such as the
Decalogue (Ex 20:1-17) and the Book of the Covenant
(Ex 20:22-23:33). Far from being an arbitrary restriction

on the life of the people, these codes made life in

* St. Cyprian, On Worfcs and Almsgiving, 25, trans. R. J. Deferrari,
St. Cyprian: Treatises, 36 (New York; Fathers of the Church, 1958),
251. Original text in Migne, Patrologia Latina, vol. 4, 620. On the
Patrishc teaching, see C. Avila, Ownership: Early Christian Teaching

(Maryknoll, N.Y.; Orbis Books, 1983). Collection of original texts
and translations.

19



community possible.® The specific laws of the cove-

nant protect human life and property, demand respect

for parents and the spouses and children of one's

neighbor, and manifest a special concern for the vul-

nerable members of the community: widows, or-

phans, the poor, and strangers in the land. Laws such

as that for the Sabbath year when the land was left

fallow (Ex 23:11; Lv 25:1-7) and for the year of release

of debts (Dt 15:1-11) summoned people to respect the

land as God's gift and reminded Israel that as a people

freed by God from bondage they were to be concerned

for the poor and oppressed in their midst. Every fif-

tieth year a jubilee was to be proclaimed as a year of

"liberty throughout the land" and property was to be

restored to its original owners (Lv 25:8-17, cf. Is 61:1-

2; Lk 4:18-19).® The codes of Israel reflect the norms

of the covenant: reciprocal responsibility, mercy, and

truthfulness. They embody a life in freedom from

oppression: worship of the One God, rejection of idol-

atry, mutual respect among people, care and protec-

tion for every member of the social body. Being free

and being a co-responsible community are God's in-

tentions for us.

37. When the people turn away from the living

God to serve idols and no longer heed the commands

of the covenant, God sends prophets to recall his

saving deeds and to summon them to return to the

one who betrothed them "in right and in justice, in

love and in mercy" (Hos 2:21). The substance of

* T. Ogletree, The Use of the Bible in Christian Ethics (Philadelphia:

Fortress Press, 1983), 47-85.

** Though scholars debate whether the Jubilee was a historical

institution or an ideal, its images were continually evoked to stress

God's sovereignty over the land and God's concern for the poor

and the oppressed (e.g.. Is 61:1-2; Lk 4:16-19). See R. North, So-

ciology of the Biblical Jubilee (Rome: Biblical Institute, 1954);
S. Ringe,

Jesus, Liberation and the Biblical Jubilee: Images for Ethics and
Christology

(Philadelphia: Fortress Press, 1985).

20



prophetic faith is proclaimed by Micah: "to do justice

and to love kindness, and to walk humbly with your

God" (Mi 6:8, RSV). Biblical faith in general, and

prophetic faith especially, insist that fidelity to the

covenant joins obedience to God with reverence and

concern for the neighbor. The biblical terms which

best summarize this double dimension of Israel's faith

are sedaqah, justice (also translated as righteousness),

and mishpat (right judgment or justice embodied in a

concrete act or deed). The biblical understanding of

justice gives a fundamental perspective to our reflec-

tions on social and economic justice.^

38. God is described as a "God of justice" (Is 30:18)

who loves justice (Is 61:8, cf. Pss 11:7; 33:5; 37:28; 99:4)

and delights in it (Jer 9:23). God demands justice from

the whole people (Dt 16:20) and executes justice for

the needy (Ps 140:13). Central to the biblical presen-

tation of justice is that the justice of a community is

measured by its treatment of the powerless in society,

most often described as the widow, the orphan, the

{X)or, and the stranger (non-Israelite) in the land. The

Law, the Prophets, and the Wisdom literature of the

Old Testament all show deep concern for the proper

treatment of such people.® What these groups of peo-

ple have in common is their vulnerability and lack of
power. They are often alone and have no protector

or advocate. Therefore, it is God who hears their cries
(Pss 109:21; 1 13:7), and the king who is God's anointed
is commanded to have special concern for them.

' On justice, see J. R. Donahue, "Biblical Perspectives on Jus-
tice," in Haughey, ed., The Faith That Does Justice (New York: Paulist

Press, 1977), 68-112; and S. C. Mott, Biblical Ethics and Social Change

(New York: Oxford University Press, 1982).
» See Ex 22:20-26; Dt 15:1-11; Jb 29:12-17; Pss 69:34; 72:2, 4, 12-

24; 82:3-4; Prv 14:21, 31; Is 3:14-15; 10:2; Jer 22:16; Zee 7:9-10.

21



39. Justice has many nuances.’ Fundamentally, it

suggests a sense of what is right or of what should

happen. For example, paths are just when they bring

you to your destination (Gn 24:48; Ps 23:3), and laws

are just when they create harmony within the com-

munity, as Isaiah says: "Justice will bring about peace;

right will produce calm and security" (Is 32:17). God

is "just" by acting as God should, coming to the peo-

ple's aid and summoning them to conversion when

they stray. People are summoned to be "just," that

is, to be in a proper relation to God, by observing

God's laws which form them into a faithful commu-

nity. Biblical justice is more comprehensive than sub-

sequent philosophical definitions. It is not concerned

with a strict definition of rights and duties, but with

the rightness of the human condition before God and

within society. Nor is justice opposed to love; rather,

it is both a manifestation of love and a condition for

love to grow.'® Because God loves Israel, he rescues

them from oppression and summons them to be a

people that "does justice" and loves kindness. The

quest for justice arises from loving ^atitude for the

saving acts of God and manifests itself in whole-

hearted love of God and neighbor.

40. These perspectives provide the foundation for

a biblical vision of economic justice. Every human

person is created as an image of God, and the denial

of dignity to a person is a blot on this image. Creation

is a gift to all men and women, not to be appropriated

for the benefit of a few; its beauty is an object of joy

and reverence. The same God who came to the aid

of an oppressed people and formed them into a cov-

enant community continues to hear the cries of the

'*

J. Pedersen, Israel: Its Life and Culture, vol.
l-Il (London: Oxford

University Press, 1926), 337-340.

J.
Alfaro, Theology of justice in the World (Rome: Pontifical Com-

mission on Justice and Peace, 1973), 40-41; E. McDonagh, The Mak-

ing of Disciples (Wilmington, Del.: Michael Glazier, 1982),
119.

22



oppressed and to create communities which are re-

sponsive to God's word. God's love and life are pres-

ent when people can live in a community of faith and

hope. These cardinal points of the faith of Israel also

furnish the religious context for understanding the

saving action of God in the life and teaching of Jesus.

3. The Reign of God and Justice

41
.
Jesus enters human history as God's anointed

son who announces the nearness of the reign of God
(Mk 1:9-14). This proclamation summons us to ac-
knowledge God as creator and covenant partner and
challenges us to seek ways in which God's revelation

of the dignity and destiny of all creation might become

incarnate in history. It is not simply the promise of

the future victory of God over sin and evil, but that
this victory has already begun—in the life and teach-
ing of Jesus.

42. What Jesus proclaims by word, he enacts in his
ministry. He resists temptations of power and pres-
tige, follows his Father's will, and teaches us to pray

that it be accomplished on earth. He warns against
attempts to "lay up treasures on earth" (Mt 6:19) and

exhorts his followers not to be anxious about material

goods but rather to seek first God's reign and God's

justice (Mt 6:25-33). His mighty works symbolize that

the reign of God is more powerful than evil, sickness,
and the hardness of the human heart. He offers God's
loving mercy to sinners (Mk 2:17), takes up the cause
of those who suffered religious and social discrimi-
nation (Lk 7:36-50; 15:1-2), and attacks the use of re-

ligion to avoid the demands of charity and justice (Mk
7:9-13; Mt 23:23).

43. When asked what was the greatest command-
ment, Jesus quoted the age-old Jewish affirmation of

faith that God alone is One and to be loved with the

23



whole heart, mind, and soul (Dt 6:4-5) and immedi-

ately adds: "You shall love your neighbor as yourself"

(Lv 19:18, Mk 12:28-34). This dual command of love

that is at the basis of all Christian morality is illustrated

in the Gospel of Luke by the parable of a Samaritan

who interrupts his journey to come to the aid of a

dying man (Lk 10:29-37). Unlike the other wayfarers

who look on the man and pass by, the Samaritan "was

moved with compassion at the sight"; he stops, tends

the wounded man, and takes him to a place of safety.

In this parable compassion is the bridge between mere

seeing and action; love is made real through effective

action."

44. Near the end of his life, Jesus offers a vivid

picture of the last judgment (Mt 25: 31-46). All the

nations of the world will be assembled and will be

divided into those blessed who are welcomed into

God's kingdom or those cursed who are sent to eternal

punishment. The blessed are those who fed the hun-

gry, gave drink to the thirsty, welcomed the stranger,

clothed the naked, and visited the sick and impris-

oned; the cursed are those who neglected these works

of mercy and love. Neither the blessed nor the cursed

are astounded that they are judged by the Son of Man,

nor that judgment is rendered according to works of

charity. The shock comes when they find that in ne-

glecting the poor, the outcast, and the oppressed, they

were rejecting Jesus himself. Jesus who came as "Em-

manuel" (God with us, Mt 1:23) and who promises

to be with his people until the end of the age (Mt

28:20) is hidden in those most in need; to reject them

is to reject God made manifest in history.

" Pope John Paul II has drawn on this parable to exhort us to

have a "compassionate heart" to those in need in his Apostolic

Letter "On the Christian Meaning of Human Suffering" (Satvifici

Doloris) (Washington, D.C.: USCC Office of Publishing and Pro-

motion ^rvices, 1984), 34-39.

24



4. Called To Be Disciples in Community

45. Jesus summoned his first followers to a change
of heart and to take on the yoke of God's reign (Mk
1:14-15; Mt 11:29). They are to be the nucleus of that
community which will continue the work of proclaim-
ing and building God's kingdom through the centu-
ries. As Jesus caUed the first disciples in the midst of
their everyday occupations of fishing and tax collect-
ing; so he again calls people in every age in the home,
in the workplace, and in the marketplace.

46. The Church is, as Pope John Paul II reminded
us, "a community of disciples" in which "we must
see first and foremost Christ saying to each member
of the community: follow me."’^ To be a Christian is
to join with others in responding to this personal call

and in learning the meaning of Christ's life. It is to
be sustained by that loving intimacy vdth the Father
that Jesus experienced in his work, in his prayer, and
in his suffering.

47. Discipleship involves imitating the pattern of

Jesus' life by openness to God's will in the service of
others (Mk 10:42-45). Disciples are also called to follow
him on the way of the cross, and to heed his caU that
those who lose their lives for the sake of the Gospel
wiU save them (Mk 8:34-35). Jes-us' death is an example
of that greater love which lays down one's life for
others (cf. Jn 15:12-18). It is a model for those who
suffer persecution for the sake of justice (Mt 5:10).
The death of Jesus was not the end of his power and
presence, for he was raised up by the power of God.
Nor did it mark the end of the disciples' union with
him. After Jesus had appeared to them and when they
received the gift of the Spirit (Acts 2:1-12), they became
apostles of the good news to the ends of the earth.
In the face of poverty and persecution they trans-

“ Redeemer of Man, 21 .

25



formed human lives and formed communities which

became signs of the power and presence of God. Shar-

ing in this same resurrection faith, contemporary fol-

lowers of Christ can face the struggles and challenges

that await those who bring the gospel vision to bear

on our complex economic and social world.

5. Poverty, Riches, and the

Challenge of Discipleship

48. The pattern of Christian life as presented in the

Gospel of Luke has special relevance today. In her

Magnificat, Mary rejoices in a God who scatters the

proud, brings down the mighty, and raises up the

poor and lowly (Lk 1:51-53). The first public utterance

of Jesus is "The Spirit of the Lord is upon me, because

he has anointed me to preach the good news to the

poor" (Lk 4:18 cf. Is 61:1-2). Jesus adds to the blessing

on the poor a warning, "Woe to you who are rich,

for you have received your consolation" (Lk 6:24). He

warns his followers against greed and reliance on

abundant possessions and underscores this by the

parable of the man whose life is snatched away at the

very moment he tries to secure his wealth (Lk 12:13-

21). In Luke alone, Jesus tells the parable of the rich

man who does not see the poor and suffering Lazarus

at his gate (Lk 16:19-31). When the rich man finally
"sees" Lazarus, it is from the place of torment and

the opportunity for conversion has passed. Pope John

Paul II has often recalled this parable to warn the

prosperous not to be blind to the great poverty that

exists beside great wealth.'^

49. Jesus, especially in Luke, lives as a poor man,

like the prophets takes the side of the poor, and warns

Address to Workers at Sao Paulo, 8, Origins 10:9 (July 31,

1980): 139; and Address at Yankee Stadium, Origins 9:19 (October

25, 1979): 311-312.

26



of the dangers of wealth.'^ The terms used for poor,

while primarily describing lack of material goods, also

suggest dependence and powerlessness. The poor are

also an exiled and oppressed people whom God will
rescue (Is 51:21-23) as well as a faithful remnant who
take refuge in God (Zep 3:12-13). Throughout the Bi-
ble, material poverty is a misfortune and a cause of

sadness. A constant biblical refrain is that the poor
must be cared for and protected and that when they
are exploited, God hears their cries (Prv 22:22-23).
Conversely, even though the goods of the earth are

to be enjoyed and people are to thank God for material
blessings, wealth is a constant danger. The rich are

wise in their own eyes (Prv 28:11), and are prone to
apostasy and idolatry (Am 5:4-13; Is 2:6-8), as well as
to violence and oppression (Jas 2:6-7).'® Since they are

neither blinded by wealth nor make it into an idol,
the poor can be open to God's presence; throughout

Israel's history and in early Christianity the poor are

agents of God's transforming power.

50. The poor are often related to the lowly (Mt

5:3,5) to whom God reveals what was hidden from
the wise (Mt 11:25-30). When Jesus calls the poor
"blessed," he is not praising their condition of pov-

erty, but their openness to God. When he states that
the reign of God is theirs, he voices God's special
concern for them, and promises that they are to be
the beneficiaries of God's mercy and justice. When
he summons disciples to leave all and follow him, he

]. Dupont and A. George, eds.. La pauvrete evangelique (Paris:
Cerf, 1971); M. Hengel, Property and Riches in the Early Church (Phil-
adelphia: Fortress Press, 1974); L. Johnson, Sharing Possessions: Man-
date and Symbol of Faith (Philadelphia: Fortress Press, 1981); D. L.

Mealand, Poverty and Expectation in the Gospels (London: SPCK,
1980); W. Pilgrim, Good Neios to the Poor: Wealth and Poverty in Luke-
Acts (Minneapolis: Augsburg, 1981); and W. Stegemann, The Gospel
and the Poor (Philadelphia: Fortress Press, 1984).

'* See Am 4:1-3; Jb 20:19; Sir 13:4-7; Jas 2:6; 5:1-6; Rv 18:11-19.

27



is calling them to share his own radical trust in the

Father and his freedom from care and anxiety (cf. Mt

6:25-34). The practice of evangelical poverty in the

Church has always been a living witness to the power

of that trust and to the joy that comes with that free-

dom.

51. Early Christianity saw the poor as an object of

God's special love, but it neither canonized material

poverty nor accepted deprivation as an inevitable fact

of life. Though few early Christians possessed wealth

or power (1 Cor 1:26-28; Jas 2:5), their communities

had well-off members (Acts 16:14; 18:8). Jesus' concern

for the poor was continued in different forms in the

early Church. The early community at Jerusalem dis-

tributed its possessions so that "there was no needy

person among them," and held "all things in com-

mon"—a phrase that suggests not only shared ma-
terial possessions, but more fundamentally, friendship

and mutual concern among all its members (Acts 4:32-

34; 2:44). While recognizing the dangers of wealth,

the early Church proposed the proper use of posses-

sions to alleviate need and suffering, rather than uni-

versal dispossession. Beginning in the first century

and throughout history, Christian communities have

developed varied structures to support and sustain

the weak and powerless in societies that were often

brutally unconcerned about human suffering.

52. Such perspectives provide a basis today for what

is called the "preferential option for the poor."'*

Though in the Gospels and in the New Testament as
a whole the offer of salvation is extended to all peo-

ples, Jesus takes the side of those most in need, phys-

ically and spiritually. The example of Jesus poses a

number of challenges to the contemporary Church.

It imposes a prophetic mandate to speak for those

who have no one to speak for them, to be a defender

“ See paras. 85-91.

28



of the defenseless, who in biblical terms are the poor.

It also demands a compassionate vision that enables

the Church to see things from the side of the poor

and powerless and to assess lifestyle, policies, and

social institutions in terms of their impact on the poor.

It summons the Church also to be an instrument in

assisting people to experience the liberating power of

God in their own lives so that they may respond to

the Gospel in freedom and in dignity. Finally, and

most radically, it calls for an emptying of self, both

individually and corporately, that allows the Church

to experience the power ofGod in the midst of poverty

and powerlessness.

6. A Community of Hope

53. The biblical vision of creation, covenant, and

community, as well as the summons to discipleship,

unfolds under the tension between promise and ful-

fillment. The whole Bible is spanned by the narratives

of the first creation (Gn 1-3) and the vision of a restored

creation at the end of history (Rv 21:1-4). Just as cre-

ation tells us that God's desire was one of wholeness

and unity between God and the human family and

within this family itself, the images of a new creation

give hope that enmity and hatred will cease and justice

and peace will reign (Is 11:4-6; 25:1-8). Human life
unfolds "between the times," the time of the first

creation and that of a restored creation (Rom 8:18-25).

Although the ultimate realization of God's plan lies

in the future, Christians in union with all people of

good will are summoned to shape history in the image

of God's creative design, and in response to the reign

of God proclaimed and embodied by Jesus.
54. A Christian is a member of a new community,

"God's own people" (1 Pt 2:9-10), who, like the people
of Exodus, owes its existence to the gracious gift of

God and is summoned to respond to God's will made

29



manifest in the life and teaching of Jesus. A Christian
walks in the newness of life (Rom 6:4), and is "a new

creation; the old has passed away, the new has come"

(2 Cor 5:17). This new creation in Christ proclaims

that God's creative love is constantly at work, offers

sinners forgiveness, and reconciles a broken world.

Our action on behalf of justice in our world proceeds

from the conviction that, despite the power of injustice

and violence, life has been fundamentally changed by

the entry of the Word made flesh into human history.

55. Christian communities that commit themselves

to solidarity with those suffering and to confrontation

with those attitudes and ways of acting which insti-

tutionalize injustice, will themselves experience the

power and presence of Christ. They will embody in

their lives the values of the new creation while they

labor under the old. The quest for economic and social

justice will always combine hope and realism, and

must be renewed by every generation. It involves

diagnosing those situations that continue to alienate

the world from God's creative love as well as pre-

senting hopeful alternatives that arise from living in

a renewed creation. This quest arises from faith and

is sustained by hope as it seeks to speak to a broken

world of God's justice and loving kindness.

7. A Living Tradition

56. Our reflection on U.S. economic life today must

be rooted in this biblical vision of the kingdom and

discipleship, but it must also be shaped by the rich

and complex tradition of Catholic life and thought.

Throughout its history, the Christian community has

listened to the words of Scripture and sought to enact

them in the midst of daily life in very different his-

torical and cultural contexts.

57. In the first centuries, when Christians were a

minority in a hostile society, they cared for one an-

30



other through generous almsgiving. In the patristic

era, the church fathers repeatedly stressed that the

goods of the earth were created by God for the benefit
of every person without exception, and that all have

special duties toward those in need. The monasteries

of the Middle Ages were centers of prayer, learning,

and education. They contributed greatly to the cul-

tural and economic life of the towns and cities that

sprang up around them. In the twelfth century the
new mendicant orders dedicated themselves to fol-
lowing Christ in poverty and to the proclamation of

the good news to the poor.

58. These same religious communities also nur-
tured some of the greatest theologians of the Church's

tradition, thinkers who synthesized the call of Christ
with the philosophical learning of Greek, Roman, Jew-
ish, and Arab worlds. Thomas Aquinas and the other
scholastics devoted rigorous intellectual energy to

clarifying the meaning of both personal virtue and

justice in society. In more recent centuries Christians
began to build a large network of hospitals, orphan-

ages, and schools, to serve the poor and society at
large. And beginning with Leo XIII's Rerum Novarum,
down to the writings and speeches of John Paul II,
the popes have more systematically addressed the
rapid change of modem society in a series of social
encyclicals. These teachings of modern popes and of
the Second Vatican Council are especially significant

for efforts to respond to the problems facing society

today.

59. We also have much to learn from the strong
emphasis in Protestant traditions on the vocation of
lay people in the world and from ecumenical efforts
to develop an economic ethic that addresses newly

emergent problems. And in a special way our fellow
Catholics in developing countries have much to teach

See Selected Bibliography.

31



US about the Christian response to an ever more in-

terdependent world.

60. Christians today are called by God to carry on

this tradition through active love of neighbor, a love

that responds to the special challenges of this moment

in human history. The world is wounded by sin and

injustice, in need of conversion and of the transfor-

mation that comes when persons enter more deeply

into the mystery of the death and Resurrection of

Christ. The concerns of this pastoral letter are not at

all peripheral to the central mystery at the heart of

the Church.'* They are integral to the proclamation

of the Gospel and part of the vocation of every Chris-

tian today.*’

B. Ethical Norms for Economic Life

61 . These biblical and theological themes shape the

overall Christian perspective on economic ethics. This

perspective is also subscribed to by many who do not

share Christian religious convictions. Human under-

standing and religious belief are complementary, not

contradictory. For human beings are created in God's

image, and their dignity is manifest in the ability to

reason and understand, in their freedom to shape

their own lives and the life of their communities, and

in the capacity for love and friendship. In proposing

ethical norms, therefore, we appeal both to Christians

and to all in our pluralist society to show that respect

and reverence owed to the dignity of every person.

Intelligent reflection on the social and economic real-

ities of today is also indispensable in the effort to

'• Extraordinary Synod of Bishops (1985) The Final Report, II, A

(Washington, D.C.: USCC Office of Publishing and Promotion

Services, 1986).

” Pope Paul VI, On Evangelization in the Modem World, 31.

32



respond to economic circumstances never envisioned

in biblical times. Therefore, we now want to propose
an ethical framework that can guide economic life

today in ways that are both faithful to the Gospel and

shaped by human experience and reason.
62. First we outline the duties all people have to

each other and to the whole community: love of neigh-

bor, the basic requirements of justice, and the special

obligation to those who are poor or vulnerable. Cor-
responding to these duties are the human rights of
every person; the obligation to protect the dignity of

all demands respect for these rights. Finally these
duties and rights entail several priorities that should

guide the economic choices of individuals, commu-
nities, and the nation as a whole.

!• The Responsibilities of Social Living

63. Human life is life in community. Catholic social
teaching proposes several complementary perspec-
tives that show how moral responsibilities and duties
in the economic sphere are rooted in this call to com-
munity.

a. Love and Solidarity

64.

The commandments to love God with all one’s heart
and to love one's neighbor as oneself are the heart and soul

of Christian morality. Jesus offers himself as the model
of this all-inclusive love: ". . . love one another as I
have loved you" (Jn 15:12). These commands point
out the path toward true human fulfillment and hap-
piness. They are not arbitrary restrictions on human
freedom. Only active love ofGod and neighbor makes
the fullness of community happen. Christians look
forward in hope to a true communion among all per-
sons with each other and with God. The Spirit of

33



Christ labors in history to build up the bonds of sol-

idarity among all persons until that day on which their

union is brought to perfection in the Kingdom of God.“

Indeed Christian theological reflection on the very

reality of God as a trinitarian unity of persons—Father,
Son, and Holy Spirit—shows that being a person
means being united to other persons in mutual love.^'

65. What the Bible and Christian tradition teach,

human wisdom confirms. Centuries before Christ, the

Greeks and Romans spoke of the human person as a

"social animal" made for friendship, community, and

public life. These insights show that human beings

achieve self-realization not in isolation, but in inter-

action with others.

“

66. The virtues of citizenship are an expression of

Christian love more crucial in today's interdependent

world than ever before. These virtues grow out of a

lively sense of one's dependence on the commonweal

and obligations to it. This civic commitment must also

guide the economic institutions of society. In the ab-

sence of a vital sense of citizenship among the busi-

nesses, corporations, labor unions, and other groups

that shape economic life, society as a whole is en-

dangered. Solidarity is another name for this social

friendship and civic commitment that make human

moral and economic life possible.

67. The Christian tradition recognizes, of course,

that the fullness of love and community will be

achieved only when God's work in Christ comes to

completion in the kingdom of God. This kingdom has

been inaugurated among us, but God's redeeming

and transforming work is not yet complete. Within

history, knowledge of how to achieve the goal of social

unity is limited. Human sin continues to wound the

" Ibid., 24.

Pastoral Constitution, 32.

“ Ibid., 25.

34



lives of both individuals and larger social bodies and

places obstacles in the path toward greater social sol-

idarity. If efforts to protect human dignity are to be
effective, they must take these limits on knowledge

and love into account. Nevertheless, sober realism

should not be confused with resigned or cynical pes-

simism. It is a challenge to develop a courageous hope

that can sustain efforts that will sometimes be arduous

and protracted.

b. Justice and Participation

68. Biblical justice is the goal we strive for. This
rich biblical understanding portrays a just society as

one marked by the fullness of love, compassion, hol-

iness, and peace. On their path through history, how-
ever, sinful human beings need more specific guidance
on how to move toward the realization of this great
vision of God's Kingdom. This guidance is contained

in the norms of basic or minimal justice. These norms

state the minimum levels of mutual care and respect

that all persons owe to each other in an imperfect
world.“ Catholic social teaching, like much philo-
sophical reflection, distinguishes three dimensions of

basic justice: commutative justice, distributive justice,

and social justice.

69. Commutative justice calls for fundamental fairness

in all agreements and exchanges between individuals or

private social groups. It demands respect for the equal
human dignity of all persons in economic transac-
tions, contracts, or promises. For example, workers

owe their employers diligent work in exchange for

“ See para. 39.

Josef Pieper, The Four Cardinal Virtues (Notre Dame, Ind.: Uni-
versity of Notre Dame Press, 1966), 43-116; David Hollenbach,
"Modem Catholic Teachings concerning Justice," in John C. Haughey
ed.. The Faith That Does Justice (New York: Paulist Press, 1977), 207-
231.

35



their wages. Employers are obligated to treat their

employees as persons, paying them fair wages in ex-

change for the work done and establishing conditions

and patterns of work that are truly human.

“

70. Distributive justice requires that the allocation of

income, wealth, and power in society be evaluated in light

of its effects on persons whose basic material needs are unmet.

The Second Vatican Council stated: "The right to have

a share of earthly goods sufficient for oneself and one's

family belongs to everyone. The fathers and doctors

of the Church held this view, teaching that we are

obliged to come to the relief of the poor and to do so

not merely out of our superfluous goods. Minimum

material resources are an absolute necessity for human

life. If persons are to be recognized as members of

the human community, then the community has an

obligation to help fulfill these basic needs unless an

absolute scarcity of resources makes this strictly im-

possible. No such scarcity exists in the United States

today.

71. justice also has implications for the way the

larger social, economic, and political institutions of

society are organized. Social justice implies that persons

have an obligation to be active and productive participants

in the life of society and that society has a duty to enable

them to participate in this way. This form of justice can

also be called "contributive," for it stresses the duty

of all who are able to help create the goods, services,

and other nonmaterial or spiritual values necessary

for the welfare of the whole community. In the words

of Pius XI, "It is of the very essence of social justice

to demand from each individual all that is necessary

“Jon P. Gunnemann, "Capitalism and Commutative justice,"

presented at the 1985 meeting of the Society of Christian Ethics,

forthcoming in The Annual of the Society of Christian Ethics.

“ Pastoral Constitution, 69.

36



for the common good."^^ Productivity is essential if

the community is to have the resources to serve the

well-being of all. Productivity, however, cannot be

measured solely by its output in goods and services.

Patterns of production must also be measured in light

of their impact on the fulfillment of basic needs, em-

ployment levels, patterns of discrimination, environ-

mental quality, and sense of community.

72. The meaning of social justice also includes a

duty to organize economic and social institutions so

that people can contribute to society in ways that

respect their freedom and the dignity of their labor.

Work should enable the working person to become

"more a human being," more capable of acting intel-

ligently, freely, and in ways that lead to self-realiza-

Hon.“

73. Economic conditions that leave large numbers

of able people unemployed, underemployed, or em-

ployed in dehumanizing conditions fail to meet the

converging demands of these three forms of basic

justice. Work with adequate pay for all who seek it is

the primary means for achieving basic justice in our

society. Discrimination in job opportunities or income

levels on the basis of race, sex, or other arbitrary stan-

dards can never be justified.^’ It is a scandal that such

discrimination continues in the United States today.

Where the effects of past discrimination persist, so-

ciety has the obligation to take positive steps to over-

come the legacy of injustice. Judiciously administered

affirmative action programs in education and em-

^ Pope Pius XI, Divini Redemptoris, 51. See John A. Ryan, Dis-

tributive Justice, third edition (New York: Macmillan, 1942), 188. The

term "social justice" has been used in several different but related

ways in the Catholic ethical tradition. See William Ferree, "The Act

of Social Justice," Philosophical Studies, vol. 72 (Washington, D.C.:

The Catholic University of America Press, 1943).
“ On Human Work, 6, 9.
” Pastoral Constitution, 29.

37



ployment can be important expressions of the drive

for solidarity and participation that is at the heart of

true justice. Social harm calls for social relief.

74. Basic justice also calls for the establishment of

a floor of material well-being on which all can stand.

This is a duty of the whole of society and it creates

particular obligations for those with greater resources.

This duty calls into question extreme inequalities of

income and consumption when so many lack basic

necessities. Catholic social teaching does not maintain

that a flat, arithmetical equality of income and wealth

is a demand of justice, but it does challenge economic

arrangements that leave large numbers of people im-

poverished. Further, it sees extreme inequality as a

threat to the solidarity of the human community, for

great disparities lead to deep social divisions and con-

flict.3«

75. This means that all of us must examine our way

of living in light of the needs of the poor. Christian

faith and the norms of justice impose distinct limits

on what we consume and how we view material goods.

The great wealth of the United States can easily blind

us to the poverty that exists in this nation and the

destitution of hundreds of millions of people in other

parts of the world. Americans are challenged today

as never before to develop the inner freedom to resist

the temptation constantly to seek more. Only in this

way will the nation avoid what Paul VI called "the

most evident form of moral underdevelopment,"

namely greed.*’

76. These duties call not only for individual char-

itable giving but also for a more systematic approach

by businesses, labor unions, and the many other

groups that shape economic life—as well as govern-
ment. The concentration of privilege that exists today

Ibid. See below, paras. 180-182.

Pope Paul VI, On the Development of Peoples (1967), 19.

38



results far more from institutional relationships that

distribute power and wealth inequitably than from

differences in talent or lack of desire to work. These

institutional patterns must be examined and revised

if we are to meet the demands of basic justice. For
example, a system of taxation based on assessment

according to ability to pay^^ is a prime necessity for

the fulfillment of these social obligations.

c. Overcoming Marginalization and

Powerlessness

77. These fundamental duties can be summarized

this way: Basic justice demands the establishment of min-

imum levels of participation in the life of the human com-

munity for all persons. The ultimate injustice is for a

person or group to be treated actively or abandoned

passively as if they were nonmembers of the human
race. To treat people this way is effectively to say that
they simply do not count as human beings. This can
take many forms, all of which can be described as
varieties of marginalization, or exclusion from social

life.“ This exclusion can occur in the political sphere:

restriction of free speech, concentration of power in
the hands of a few, or outright repression by the state.

It can also take economic forms that are equally harm-

ful. Within the United States, individuals, families,

and local communities fall victim to a downward cycle
of poverty generated by economic forces they are

powerless to influence. The poor, the disabled, and
the unemployed too often are simply left behind. This
pattern is even more severe beyond our borders in
the least-developed countries. Whole nations are pre-
vented from fully participating in the international

economic order because they lack the power to change

“ Mater et Magistra, 132.

® Justice in the \Norld, 10, 16; and Octogesima Adveniens, 15.

39



their disadvantaged position. Many people within the

less developed countries are excluded from sharing

in the meager resources available in their homelands

by unjust elites and unjust governments. These pat-

terns of exclusion are created by free human beings.

In this sense they can be called forms of social sin.^

Acquiescence in them or failure to correct them when

it is possible to do so is a sinful dereliction of Christian

duty.

78. Recent Catholic social thought regards the task

of overcoming these patterns of exclusion and pow-

erlessness as a most basic demand of justice. Stated

positively, justice demands that social institutions be

ordered in a way that guarantees all persons the ability

to participate actively in the economic, political, and

cultural life of society.^ The level of participation may

legitimately be greater for some persons than for oth-

ers, but there is a basic level of access that must be

made available for all. Such participation is an essen-

tial expression of the social nature of human beings

and of their communitarian vocation.

2. Human Rights: The Minimum

Conditions for Life in Community

79. Catholic social teaching spells out the basic de-

mands of justice in greater detail in the human rights

of every person. These fundamental rights are pre-

requisites for a dignified life in community. The Bible

vigorously affirms the sacredness of every person as

“ Pastoral Constitution, 25; Justice in the World, 51; Pope John Paul

II, The Gift of the Redemption Apostolic Exhortation on ReconciliaHon

and Penance (Washington, D.C: USCC Office of Publishing and

Promotion Services, 1984), 16; Congregation for the Doctrine of the

Faith, Instruction on Christian Freedom and Liberation, 42, 74.

“ In the words of the 1971 Synod of Bishops: "Participation

constitutes a right which is to be applied in the economic and in

the social and political field," Justice in the World, 18.

40



a creature formed in the image and likeness of God.

The biblical emphasis on covenant and community

also shows that human dignity can only be realized

and protected in solidarity with others. In Catholic

social thought, therefore, respect for human rights

and a strong sense of both personal and community

responsibility are linked, not opposed. Vatican II de-

scribed the common good as "the sum of those con-
ditions of social life which allow social groups and

their individual members relatively thorough and

ready access to their own fulfillment."^ These con-
ditions include the rights to fulfillment of material

needs, a guarantee of fundamental freedoms, and the

protection of relationships that are essential to par-

ticipation in the life of society. These rights are be-

stowed on human beings by God and grounded in
the nature and dignity of human persons. They are
not created by society. Indeed society has a duty to

secure and protect them.^

80. The full range of human rights has been sys-
tematically outlined by John XXIII in his encyclical

Peace on Earth. His discussion echoes the United Na-

tions Universal Declaration of Human Rights and im-
plies that internationally accepted human rights
standards are strongly supported by Catholic teach-

ing. These rights include the civil and poUtical rights

to freedom of speech, worship, and assembly. A num-
ber of human rights also concern human welfare and
are of a specifically economic nature. First among these
are the rights to life, food, clothing, shelter, rest, med-

ical care, and basic education. These are indispensable

to the protection of human dignity. In order to ensure

^ Pastoral Constitution, 26.
^ Pope John Paul II, Address at the General Assembly of the

United Nations (October 2, 1979), 13, 14.

* See Pope Pius XII, 1941 Pentecost Address, in V. Yzermans,

The Major Addresses of Pope Pius XII, vol. I (St. Paul: North Central,

1%1), 32-33.

41



these necessities, all persons have a right to
earn a

living, which for most people in our economy is

through remunerative employment. All persons
also

have a right to security in the event of sickness,
un-

employment, and old age. Participation in the life of

the community calls for the protection of this
same

right to employment, as well as the right to
healthful

working conditions, to wages, and other benefits suf-

ficient to provide individuals and their families
with

a standard of living in keeping with human dignity,

and to the possibility of property ownership.^’
These

fundamental personal rights—civil and political as well
as social and economic—state the minimum condi-
tions for social institutions that respect

human dig-

nity, social solidarity, and justice. They are all
essential

to human dignity and to the integral development of

both individuals and society, and are thus moral
is-

sues.‘“ Any denial of these rights harms persons and

wounds the human community. Their serious and

sustained denial violates individuals and destroys sol-

idarity among persons.

81. Social and economic rights call for a mode of

implementation different from that required to secure

civil and political rights. Freedom of worship and of

speech imply immunity from interference on the
part

of both other persons and the government. The
rights

« Peace on Earth, 8-27. See On Human Work. 18-19. Peace on
Earth

and other modern papal statements refer explicitly to
the "right to

work" as one of the fundamental economic rights.
Because of the

ambiguous meaning of the phrase in the United States,
and also

because the ordinary way people earn their living in our
soaety is

through paid employment, the NCCB has affirmed previously
that

the protection of human dignity demands that the right
to useful

employment be secured for all who are able and willing to
work.

See NCCB, The Economy: Human Dimensions (November 20,
1975),

5, in NCCB, justice in the Marketplace, 470. See
also Congregation

for the Doctrine of the Faith, Instruction on
Christian Freedom and

Liberation, 85.

The Development of Peoples, 14.

42



to education, employment, and social security, for

example, are empowerments that call for positive ac-

tion by individuals and society at large.

82. However, both kinds of rights call for positive

action to create social and political institutions that

enable all persons to become active members of so-

ciety. Civil and political rights allow persons to par-

ticipate freely in the public life of the community, for

example, through free speech, assembly, and the vote.

In democratic countries these rights have been se-

cured through a long and vigorous history of creating

the institutions of constitutional government. In seek-

ing to secure the full range of social and economic

rights today, a similar effort to shape new economic
arrangements will be necessary.

83. The first step in such an effort is the devel-

opment of a new cultural consensus that the basic
economic conditions of human welfare are essential
to human dignity and are due persons by right. Sec-
ond, the securing of these rights will make demands
on all members of society, on all private sector insti-
tutions, and on government. A concerted effort on all
levels in our society is needed to meet these basic

demands of justice and solidarity. Indeed political de-
mocracy and a commitment to secure economic rights
are mutually reinforcing.

84. Securing economic rights for all will be an ar-

duous task. There are a number of precedents in U.S.
history, however, which show that the work has al-
ready begun. The country needs a serious dialogue

about the appropriate levels of private and public sec-

tor involvement that are needed to move forward.
There is certainly room for diversity of opinion in the
Church and in U.S. society on how to protect the hu-

*' Martha H. Good, "Freedom from Want: The Failure of United
States Courts to Protect Subsistence Rights," Human Rights Quarterly
6

(
1984): 335-365 .

43



man dignity and economic rights of all our brothers

and sisters/^ In our view, however, there can be no

legitimate disagreement on the basic moral objectives.

3. Moral Priorities for the Nation

85. The common good demands justice for all, the pro-

tection of the human rights of all . Making cultural and

economic institutions more supportive of the free-

dom, power, and security of individuals and families

must be a central, long-range objective for the nation.

Every person has a duty to contribute to building up

the commonweal. All have a responsibility to develop

their talents through education. Adults must contrib-

ute to society through their individual vocations and

talents. Parents are called to guide their children to

the maturity of Christian adulthood and responsible

citizenship. Everyone has special duties toward the

poor and the marginalized. Living up to these re-

sponsibilities, however, is often made difficult by the

social and economic patterns of society. Schools and

educational policies both public and private often serve

the privileged exceedingly well, whUe the children of

the poor are effectively abandoned as second-class

citizens. Great stresses are created in family life by

the way work is organized and scheduled, and by the

social and cultural values communicated on TV. Many

in the lower middle class are barely getting by and

fear becoming victims of economic forces over which

they have no control.

86. The obligation to provide justice for all means that

the poor have the single most urgent economic claim on the

conscience of the nation. Poverty can take many forms,

spiritual as well as material. All people face struggles

of the spirit as they ask deep questions about their

^ Pastoral Constitution, 43 .

Mater et Magistra, 65 .

44



purpose in life. Many have serious problems in mar-
riage and family life at some time in their lives, and
all of us face the certain reality of sickness and death.

The Gospel of Christ proclaims that God's love is
stronger than all these forms of diminishment. Ma-
terial deprivation, however, seriously compounds such
sufferings of the spirit and heart. To see a loved one
sick is bad enough, but to have no possibility of ob-

taining health care is worse. To face family problems,
such as the death of a spouse or a divorce, can be

devastating, but to have these lead to the loss of one's

home and end with living on the streets is something
no one should have to endure in a country as rich as
ours. In developing countries these human problems
are even more ^eatly intensified by extreme material
deprivation. This form of human suffering can be re-
duced if our own country, so rich in resources, chooses
to increase its assistance.

87. As individuals and as a nation, therefore, we
are called to make a fundamental "option for the
p>oor."*^ The obligation to evaluate social and eco-
nomic activity from the viewpoint of the poor and the
powerless arises from the radical command to love
one's neighbor as one's self. Those who are margin-
alized and whose rights are denied have privileged
claims if society is to provide justice for all. This ob-

ligation is deeply rooted in Christian belief. As Paul
VI stated:

“ On the recent use of this term see: Congregation for the Doc-
trine of the Faith, Instruction on Christian Freedom and Liberation, 46-

50, 66-68; Evangelization in Latin America's Present and Future, Final

Document of the Third General Conference of the Latin American
Episcopate (Puebla, Mexico, January 27-February 13, 1979), esp.
part VI, ch. 1, "A Preferential Option for the Poor," in J. Eagleson
and P. Scharper, eds., Puebla and Beyond (Maryknoll: Orbis Books,
1979), 264-267; Dona) Dorr, Option for the Poor: A Hundred Years of
Vatican Social Teaching (Dublin; Gill and Macmillan/Maryknoll, N. Y.

:

Orbis Books, 1983).

45



In teaching us charity, the Gospel instructs us in the

preferential respect due the poor and the special sit-

uation they have in society: the more fortunate should

renounce some of their rights so as to place their goods

more generously at the service of others."

John Paul II has described this special obligation to

the poor as "a call to have a special openness with

the small and the weak, those that suffer and weep,

those that are humiliated and left on the margin of

society, so as to help them win their dignity as human

persons and children of God.'"**

88. The prime purpose of this special commitment

to the poor is to enable them to become active par-

ticipants in the life of society. It is to enable all persons

to share in and contribute to the common good.“^ The

"option for the poor," therefore, is not an adversarial

slogan that pits one group or class against another.

Rather it states that the deprivation and powerless-

ness of the poor wounds the whole community. The

extent of their suffering is a measure of how far we

are from being a true community of persons. These

wounds will be healed only by greater solidarity with

the poor and among the poor themselves.

89. In summary, the norms of love, basic justice,

and human rights imply that personal decisions, social

policies, and economic institutions should be gov-

erned by several key priorities. These priorities do not

specify everything that must be considered in eco-

nomic decision making. They do indicate the most

fundamental and urgent objectives.

90. a. The fulfillment of the basic needs of the poor is of

the highest priority. Personal decisions, policies of pri-

Octogesima Adveniens, 23.

^ Address to Bishops of Brazil, 6, 9, Origins 10:9 31/ 1980):

135.

Pope John Paul II, Address to Workers at Sao Paulo, 4, Origins,

10:9 (July 31, 1980): 138; Congregation for the Doctrine of the Faith,

Instruction on Christian Freedom and Liberation, 66-68.

46



vate and public bodies, and power relationships must
all be evaluated by their effects on those who lack the
minimum necessities of nutrition, housing, educa-
tion, and health care. In particular, this principle rec-

ognizes that meeting fundamental human needs must
come before the fulfillment of desires for luxury con-
sumer goods, for profits not conducive to the common
good, and for unnecessary military hardware.

91 . b. Increasing active participation in economic life by

those who are presently excluded or vulnerable is a high

social priority. The human dignity of all is realized
when people gain the power to work together to im-
prove their lives, strengthen their families, and con-
tribute to society. Basic justice calls for more than
providing help to the poor and other vulnerable mem-
bers of society. It recognizes the priority of policies

and programs that support family life and enhance

economic participation through employment and
widespread ownership of property. It challenges priv-

ileged economic power in favor of the well-being of
all. It points to the need to improve the present sit-
uation of those unjustly discriminated against in the

past. And it has very important implications for both
the domestic and the international distribution of
power.

92. c. The investment of wealth, talent, and human
energy should be specially directed to benefit those who are
poor or economically insecure. Achieving a more just
economy in the United States and the world depends
in part on increasing economic resources and pro-
ductivity. In addition, the ways these resources are
invested and managed must be scrutinized in light of
their effects on non-monetary values. Investment and
management decisions have crucial moral dimen-
sions: they create jobs or eliminate them; they can
push vulnerable families over the edge into poverty
or give them new hope for the future; they help or
hinder the building of a more equitable society. Indeed

47



they can have either positive or negative influence on

the fairness of the global economy. Therefore, this

priority presents a strong moral challenge to policies

that put large amounts of talent and capital into the

production of luxury consumer goods and military

technology while failing to invest sufficiently in ed-

ucation, health, the basic infrastructure of our society,

and economic sectors that produce urgently needed

jobs, goods, and services.

93. d. Economic and social policies as well as the or-

ganization of the work world should be continually evaluated

in light of their impact on the strength and stability offamily

life. The long-range future of this nation is intimately

linked with the well-being of families, for the family

is the most basic form of human community.^ Effi-

ciency and competition in the marketplace must be

moderated by greater concern for the way work sched-

ules and compensation support or threaten the bonds

between spouses and between parents and children.

Health, education, and social service programs should

be scrutinized in light of how well they ensure both

individual dignity and family integrity.

94. These priorities are not policies. They are norms

that should guide the economic choices of all and

shape economic institutions. They can help the United

States move forward to fulfill the duties of justice and

protect economic rights. They were strongly affirmed

as implications of Catholic social teaching by Pope

John Paul II during his visit to Canada in 1984: "The

needs of the poor take priority over the desires of the

rich; the rights of workers over the maximization of

profits; the preservation of the environment over un-

controlled industrial expansion; production to meet

social needs over production for military purposes."*’

^ Pastoral Constitution, 47.

^ Address on Christian Unity in a Technological Age (Toronto,

September 14, 1984) in Origins 14:16 (October 4, 1984): 248.

48



There will undoubtedly be disputes about the concrete

applications of these priorities in our complex world.

We do not seek to foreclose discussion about them.
However, we believe that an effort to move in the
direction they indicate is urgently needed.

95. The economic challenge of today has many par-
allels with the political challenge that confronted the

founders of our nation. In order to create a new form
of political democracy they were compelled to develop

ways of thinking and political institutions that had
never existed before. Their efforts were arduous and
their goals imperfectly realized, but they launched an

experiment in the protection of civil and political rights

that has prospered through the efforts of those who
came after them. We believe the time has comefor a similar
experiment in securing economic rights: the creation of an

order that guarantees the minimum conditions of human
dignity in the economic spherefor every person. By drawing

on the resources of the Catholic moral-religious tra-
dition, we hope to make a contribution through this
letter to such a new "American Experiment": a new
venture to secure economic justice for aU.

C. Working for Greater Justice:
Persons and Institutions

96. The economy of this nation has been built by
the labor of human hands and minds. Its future will
be forged by the ways persons direct all this work
toward greater justice. The economy is not a machine
that op>erates according to its own inexorable laws,
and persons are not mere objects tossed about by
economic forces. Pope John Paul II has stated that
"human work is a key, probably the essential key, to
the whole social question."^ The Pope's understand-

" On Human Work, 3 .

49



ing of work includes virtually all forms of productive

human activity: agriculture, entrepreneurship, in-

dustry, the care of children, the sustaining
of family

life, politics, medical care, and scientific research.
Lei-

sure, prayer, celebration, and the arts are also
central

to the realization of human dignity and to the devel-

opment of a rich cultural life. It is in their daily work,

however, that persons become the subjects and o-e

ators of the economic life of the nation.*' Thus,
it is

primarily through their daily labor that people
make

their most important contributions to economic jus-

tice.

97. All work has a threefold moral significance.

First, it is a principal way that people exercise the

distinctive human capacity for self-expression and self-

realization. Second, it is the ordinary way for human

beings to fulfill their material needs. Finally,
work

enables people to contribute to the well-being of
the

larger community. Work is not only for one's self. It

is for one's family, for the nation, and indeed for
the

benefit of the entire human family.”

98. These three moral concerns should be visible

in the work of all, no matter what their role in the

economy; blue collar workers, managers, homemak-

ers, politicians, and others. They should also govern

the activities of the many different, overlapping com-

munities and institutions that make up society: fam-

ilies, neighborhoods, small businesses,
giant

corporations, trade unions, the various levels of
gov-

ernment, international organizations, and a host of

other human associations including communities of

faith.

99. Catholic social teaching calls for respect
for the

full richness of social life. The need for vital contri-

butions from different human associations—ranging

” Ibid., 5, 6.

“ Ibid., 6, 10.

50



in size from the family to government—has been clas-
sically expressed in Catholic social teaching in the

"principle of subsidiarity":

Just as it is gravely wrong to take from individuals

what they can accomplish by their own initiative and
industry and give it to the community, so also it is

an injustice and at the same time a grave evil and

disturbance of right order to assign to a greater and

higher association what lesser and subordinate or-

ganizations can do. For every social activity ought of

its very nature to furnish help (subsidium) to the mem-
bers of the body social, and never destroy and absorb

them.'^

100. This principle guarantees institutional plural-

ism. It provides space for freedom, initiative, and crea-

tivity on the part of many social agents. At the same
time, it insists that all these agents should work in

ways that help build up the social body. Therefore,

in all their activities these groups should be working

in ways that express their distinctive capacities for

action, that help meet human needs, and that make

” Quadragesimo Anno, 79.. The meaning of this principle is not

always accurately understood. For studies of its interpretation in

Catholic teaching see: Calvez and Perrin in John F. Cronin, Catholic

Social Principles, (Milwaukee: Bruce, 1950), 328-342; Johannes Mess-

ner, "Freedom as a Principle of Social Order An Essay in the
Substance of Subsidiary Function," Modem Schoolman 28 (1951): 97-

110; Richard E. Mulcahy, "Subsidiarity," New Catholic Encyclopedia
vol. 13 (New York: McGraw-Hill, 1966), 762; Franz H. Mueller,
"The Principle of Subsidiarity in Christian Tradition," American

Catholic Sociological Review) 4 (October 1943): 144-157; Oswald von
Nell-Breuning, "Zur Sozialreform, Erwagungen zum Subsidiari-
tatsprinzip," Stimmen der Zeit 157, Bd. 81 (1955-1956): Ml; id.,
"Subsidiarity," Sacramentum Mundi, vol. 6 (New York: Herder and
Herder, 1970), 6, 114-116; Arthur Fridolin Utz, Formen und Grenzen

des Subsidiaritatsprinzips (Heidelberg: F. H. Kerle Verlag, 1956); id.,

"The Principle of Subsidiarity and Contemporary Natural l^w,"
Natural Law Forum 3 (1958): 170-183; id., Grundsatze der Sozialpolitik:
Solidaritat und Subsidiaritat in der Alterversicherung (Stuttgart: Sewald

Verlag, 1969).

51



true contributions to the common good of the human

community. The task of creating a more just U.S.

economy is the vocation of all and depends on

strengthening the virtues of public service and re-

sponsible citizenship in personal life and on all levels

of institutional life.^
|

101. Without attempting to describe the tasks of !

all the different groups that make up society, we want !

to point to the specific rights and duties of some of
'

the persons and institutions whose work for justice
'

win be particularly important to the future of the United j

States economy. These rights and duties are among ,

the concrete implications of the principle of subsi- i

diarity. Further implications will be discussed in i

Chapter IV of this letter.

1. Working People and Labor Unions

102. Though John Paul n's understanding of work
j

is a very inclusive one, it fully applies to those cus-

tomarily called "workers" or "labor" in the United

States. Labor has great dignity, so great that all who I

are able to work are obligated to do so. The duty to |

work derives both from God's command and from a
j

responsibility to one's own humanity and to the com-

mon good.® The virtue of industriousness is also an

expression of a person's dignity and solidarity with

others. All working people are called to contribute to

the common good by seeking excellence in production

and service.

103. Because work is this important, people have i

a right to employment. In return for their labor, work-

ers have a right to wages and other benefits sufficient

to sustain life in dignity. As Pope Leo XIII stated,

every working person has "the right of securing things

” Pastoral Constitution, 31 .

” On Human Work, 16 .

52



to sustain The way power is distributed in a

free market economy frequently gives employers

greater bargaining power than employees in the ne-

gotiation of labor contracts. Such unequal power may

press workers into a choice between an inadequate

wage and no wage at all. But justice, not charity,

demands certain minimum guarantees. The provision

of wages and other benefits sufficient to support a

family in dignity is a basic necessity to prevent this

exploitation of workers. The dignity of workers also

requires adequate health care, security for old age or

disability, unemployment compensation, healthful

working conditions, weekly rest, periodic holidays for

recreation and leisure, and reasonable security against

arbitrary dismissal.®^ These provisions are aU essential

if workers are to be treated as persons rather than

simply as a "factor of production."

104. The Church fully supports the right of work-

ers to form unions or other associations to secure their

rights to fair wages and working conditions. This is

a specific application of the more general right to as-

sociate. In the words of Pope John Paul II, "The ex-

perience of history teaches that organizations of this

type are an indispensable element of social life, es-

pecially in modem industrialized societies."®* Unions
may also legitimately resort to strikes where this is

the only available means to the justice owed to work-

ers.®’ No one may deny the right to organize without
attacking human dignity itself. Therefore, we firmly

oppose organized efforts, such as those regrettably

now seen in this country, to break existing unions
and prevent workers from organizing. Migrant agri-

cultural workers today are particularly in need of the

^ Rerum Novarum, 62; see also 9.

^ On Human Work, 19.
» Ibid., 20.

"Ibid.

53



protection, including the right to organize and bargain

collectively. U.S. labor law reform is needed to meet

these problems as well as to provide more timely and

effective remedies for unfair labor practices.

105. Denial of the right to organize has been pur-

sued ruthlessly in many countries beyond our bor-

ders. We vehemently oppose violations of the freedom

to associate, wherever they occur, for they are an

intolerable attack on social solidarity.

106. Along with the rights of workers and unions

go a number of important responsibilities. Individual

workers have obligations to their employers, and trade

unions also have duties to society as a whole. Union

management in particular carries a strong responsi-

bility for the good name of the entire union move-

ment. Workers must use their collective power to

contribute to the well-being of the whole community

and should avoid pressing demands whose fulfillment

would damage the common good and the rights of

more vulnerable members of society.*^ It should be

noted, however, that wages paid to workers are but

one of the factors affecting the competitiveness of

industries. Thus, it is unfair to expect unions to make

concessions if managers and shareholders do not make

at least equal sacrifices.

107. Many U.S. unions have exercised leadership

in the struggle for justice for minorities and women.

Racial and sexual discrimination, however, have blot-

ted the record of some unions. Organized labor has

a responsibility to work positively toward eliminating

the injustice this discrimination has caused.

108. Perhaps the greatest challenge facing United

States workers and unions today is that of developing

a new vision of their role in the United States economy

of the future. The labor movement in the United States

stands at a crucial moment. The dynamism of the

Ibid.

54



unions that led to their rapid growth in the middle

decades of this century has been replaced by a de-
crease in the percentage of U.S. workers who are
organized. American workers are under heavy pres-
sures today that threaten their jobs. The restrictions
on the right to organize in many countries abroad
make labor costs lower there, threaten American
workers and their jobs, and lead to the exploitation
of workers in these countries. In these difficult cir-

cumstances, g^iaranteeing the rights of U.S. workers

calls for imaginative vision and creative new steps,
not reactive or simply defensive strategies. For ex-

ample, organized labor can play a very important role

in helping to provide the education and training
needed to help keep workers employable. Unions can
also help both their own members and workers in
developing countries by increasing their international

efforts. A vital labor movement will be one that looks
to the future with a deepened sense of global inter-
dependence.

109. There are many signs that these challenges
are being discussed by creative labor leaders today.
Deeper and broader discussions of this sort are needed.
This does not mean that only organized labor faces
these new problems. All other sectors and institutions
in the U.S. economy need similar vision and imagi-
nation. Indeed new forms of cooperation among la-
bor, management, government, and other social
groups are essential, and will be discussed in Chapter
IV of this letter.

2. Owners and Managers

110. The economy's success in fulfilling the de-
mands of justice will depend on how its vast resources
and wealth are managed. Property owners, managers,
and investors of financial capital must all contribute
to creating a more just society. Securing economic

55



justice depends heavily on the leadership of men and

women in business and on wise investment by private

enterprises. Pope John Paul II has pointed out, "The

degree of well-being which society today enjoys would

be unthinkable without the dynamic figure of the busi-

ness person, whose function consists of organizing

human labor and the means of production so as to

give rise to the goods and services necessary for the

prosperity and progress of the community. The

freedom of entrepreneurship, business, and finance

should be protected, but the accountability of this

freedom to the common good and the norms of justice

must be assured.

111. Persons in management face many hard

choices each day, choices on which the weU-being of

many others depends. Commitment to the public good

and not simply the private good of their firms is at

the heart of what it means to call their work a vocation

and not simply a career or a job. We believe that the
norms and priorities discussed in this letter can be of

help as they pursue their important tasks. The duties

of individuals in the business world, however, do not

exhaust the ethical dimensions of business and fi-

nance. The size of a firm or bank is in many cases an

indicator of relative power. Large corporations and

large financial institutions have considerable power

to help shape economic institutions within the United

States and throughout the world. With this power

goes responsibility and the need for those who man-

age it to be held to moral and institutional account-

ability.

112. Business and finance have the duty to be faith-

ful trustees of the resources at their disposal. No one
can ever own capital resources absolutely or control

Pope John Paul II, Address to Business Men and Econonuc

Managers (Milan, May 22, 1983) in L'Osservatore Romano, weekly

edition in English (June 20, 1983): 9:1.

56



their use without regard for others and society as a

whole.“ This applies first of all to land and natural

resources. Short-term profits reaped at the cost of

depletion of natural resources or the poUution of the

environment violate this trust.

113. Resources created by human industry are also

held in trust. Owners and managers have not created

this capital on their own. They have benefited from

the work of many others and from the local com-

munities that support their endeavors.“ They are ac-

countable to these workers and communities when

making decisions. For example, reinvestment in tech-

nological innovation is often crucial for the long-term

viability of a firm. The use of financial resources solely

in pursuit of short-term profits can stunt the produc-

tion of needed goods and services; a broader vision

of managerial responsibility is needed.

114. The Catholic tradition has long defended the

right to private ownership of productive property.**

This right is an important element in a just economic

policy. It enlarges our capacity for creativity and ini-

tiative.*® Small and medium-sized farms, businesses,

and entrepreneurial enterprises are among the most

creative and efficient sectors of our economy. They

should be highly valued by the people of the United

States, as are land ownership and home ownership.

Widespread distribution of property can help avoid

excessive concentration of economic and political

power. For these reasons ownership should be made

possible for a broad sector of our population.**

“ Thomas Aquinas, Summa Theologiae, Ila, Ilae, q. 66.
“ As Pope John Paul II has stated: "'This gigantic and powerful

instrument—the whole collection of the means of production that
in a sense are considered synonymous with 'capital'—is the result
of work and bears the signs of human labor" On Human Work, 12.

“ Rerum Novarum, 10, 15, 36.

^ Mater et Magistra, 109.

“ Rerum Novarum, 65, 66; Mater et Magistra, 115.

57



115. The common good may sometimes demand

that the right to own be limited by public involvement

in the planning or ownership of certain sectors of the

economy. Support of private ownership does not mean

that anyone has the right to unlimited accumulation

of wealth. "Private property does not constitute for

anyone an absolute or unconditioned right. No one

is justified in keeping for his exclusive use what he

does not need, when others lack necessities."*^ Pope

John Paul II has referred to limits placed on ownership

by the duty to serve the common good as a "social

mortgage" on private property.*® For example, these

limits are the basis of society's exercise of eminent

domain over privately owned land needed for roads

or other essential public goods. The Church's teaching

opposes collectivist and statist economic approaches.

But it also rejects the notion that a free market au-

tomatically produces justice. Therefore, as Pope John

Paul II has argued, "One cannot exclude the sociali-

zation, in suitable conditions, of certain means of pro-

duction."*’ The determination of when such conditions

exist must be made on a case by case basis in light of

the demands of the common good.

116. United States business and financial enter-

prises can also help determine the justice or injustice

of the world economy. They are not all-powerful, but

their real power is unquestionable. Transnational cor-

porations and financial institutions can make positive

contributions to development and global solidarity.

Pope John Paul II has pointed out, however, that the

desire to maximize profits and reduce the cost of nat-

ural resources and labor has often tempted these

transnational enterprises to behavior that increases

On the Development of Peoples. 23.
“ Pope John Paul II, Opening Address at the Puebla Conference

(Puebla, Mexico, January 28, 1979) in John Eagleson and Philip

Scharper, eds., Puebla and Beyond, 67.

“ On Human Work, 14.

58



inequality and decreases the stability of the interna-

tional order.^ By collaborating with those national

governments that serve their citizens justly and with

intergovernmental agencies, these corporations can

contribute to overcoming the desperate plight of many

persons throughout the world.

117. Business people, managers, investors, and fi-

nanciers follow a vital Christian vocation when they

act responsibly and seek the common good. We en-
courage and support a renewed sense of vocation in

the business community. We also recognize that the
way business people serve society is governed and

limited by the incentives which flow from tax policies,

the availability of credit, and other public policies.

118. Businesses have a right to an institutional

framework that does not penalize enterprises that act

responsibly. Governments must provide regulations

and a system of taxation which encourage firms to

preserve the environment, employ disadvantaged

workers, and create jobs in depressed areas. Managers

and stockholders should not be tom between their

responsibilities to their organizations and their re-

sponsibilities toward society as a whole.

3. Citizens and Government

119. In addition to rights and duties related to spe-

cific roles in the economy, everyone has obligations

based simply on membership in the social community.

By fulfilling these duties, we create a true common-
wealth. Volunteering time, talent, and money to work

for greater justice is a fundamental expression of

Christian love and social solidarity. All who have more
than they need must come to the aid of the poor.

People with professional or technical skills needed to

enhance the lives of others have a duty to share them.

Ibid., 17.

59



And the poor have similar obligations: to work to-

gether as individuals and families to build up their

communities by acts of social solidarity and justice.

These voluntary efforts to overcome injustice are part

of the Christian vocation.

120. Every citizen also has the responsibility to work

to secure justice and human rights through an or-

ganized social response. In the words of Pius XI,

"Charity will never be true charity unless it takes jus-

tice into account. . . . Let no one attempt with small

gifts of charity to exempt himself from the great duties

imposed by justice."^’ The guaranteeing of basic jus-

tice for all is not an optional expression of largesse

but an inescapable duty for the whole of society.

121. The traditional ^stinction between society and

the state in Catholic social teaching provides the basic

framework for such organized public efforts. The

Church opposes all statist and totalitarian approaches

to socioeconomic questions. Social life is richer than

governmental power can encompass. All groups that

compose society have responsibilities to respond to

the demands of justice. We have just outlined some
of the duties of labor unions and business and finan-

cial enterprises. These must be supplemented by ini-

tiatives by local community groups, professional

associations, educational institutions, churches, and

synagogues. All the groups that give life to this society

have important roles to play in the pursuit of economic

justice.

122. For this reason, it is all the more significant

that the teachings of the Church insist that government

has a moral function: protecting human rights and securing

basic justice for all members of the commonwealth.^ Society

as a whole and in all its diversity is responsible for

building up the common good. But it is government's

^ Divini Redemptoris, 49 .

^ Peace on Earth, 60-62 .

60



role to guarantee the minimum conditions that make

this rich social activity possible, namely, human rights

and justice.” This obligation also falls on individual

citizens as they choose their representatives and par-

ticipate in shaping public opinion.

123. More specifically, it is the responsibility of all

citizens, acting through their government, to assist

and empower the poor, the disadvantaged, the hand-

icapped, and the unemployed. Government should

assume a positive role in generating employment and

establishing fair labor practices, in guaranteeing the

provision and maintenance of the economy's infra-

structure, such as roads, bridges, harbors, public

means of communication, and transport. It should

regulate trade and commerce in the interest of fair-

ness.” Government may levy the taxes necessary to

meet these responsibilities, and citizens have a moral

obligation to pay those taxes. The way society re-

sponds to the needs of the poor through its public

^ Vatican Council II, Declaration on Religious Freedom (Dignitatis

Humanae), 6. See John Courtney Murray, The Problem of Religious

Freedom, Woodstock Papers, no. 7 (Westminster, Md.: Newman

Press, 1965).

Peace on Earth, 63-64. Quadragesimo Anno, 80. In Rerum Novarum

Pope Leo XIII set down the basic norm that determines when

government intervention is called for: "If, therefore, any injury has

been done to or threatens either the common good or the interests

of individual groups, which injury cannot in any other way be

repaired or prevented, it is necessary for public authority to inter-

vene" Rerum Novarum, 52. Pope John XXIII synthesized the Church's

understanding of the function of governmental intervention this

way: "The State, whose purpose is the realization of the common

good in the temporal order, can by no means disregard the eco-

nomic activity of its citizens. Indeed it should be present to promote

in suitable manner the production of a sufficient supply of material

goods, . . . contribute actively to the betterment of the living con-

ditions of workers, ... see to it that labor agreements are entered

into according to the norms of justice and equity, and that in the

environment of work the dignity of the human being is not violated

either in body or spirit" Mater et Magistra, 20-21.

61



policies is the litmus test of its justice or injustice. The

political debate about these policies is the indispen-

sable forum for dealing with the conflicts and trade-

offs that will always be present in the pursuit of a

more just economy.

124. The primary norm for determining the scope

and limits of governmental intervention is the "prin-

ciple of subsidiarity" cited above. This principle states

that, in order to protect basic justice, government

should undertake only those initiatives which exceed

the capacity of individuals or private groups acting

independently. Government should not replace or de-

stroy smaller communities and individual initiative.

Rather it should help them to contribute more effec-

tively to social well-being and supplement their ac-

tivity when the demands of justice exceed their

capacities. This does not mean, however, that the

government that governs least governs best. Rather

it defines good government intervention as that which

truly "helps" other social groups contribute to the

common good by directing, urging, restraining, and

regulating economic activity as "the occasion requires

and necessity demands."” This calls for cooperation

and consensus-building among the diverse agents in

our economic life, including government. The precise

form of government involvement in this process can-

not be determined in the abstract. It will depend on

an assessment of specific needs and the most effective

ways to address them.

D. Christian Hope and the

Courage To Act

125. The Christian vision is based on the conviction

that God has destined the human race and all creation

” Quadragesima Anno, 79 .

62



for "a kingdom of truth and life, of holiness and grace,
of justice, love, and peace. This conviction gives
Christians strong hope as they face the economic
struggles of the world today. This hope is not a naive
optimism that imagines that simple formulas for cre-
ating a fully just society are ready at hand. The
Church's experience through history and in nations
throughout the world today has made it wary of all
ideologies that claim to have the final answer to hu-
manity's problems.^ Christian hope has a much
stronger foundation than such ideologies, for it rests

on the knowledge that God is at work in the world,
"preparing a new dwelling place and a new earth
where justice will abide.

126. This hope stimulates and strengthens Chris-
tian efforts to create a more just economic order in
spite of difficulties and setbacks.” Christian hope is
strong and resilient, for it is rooted in a faith that
knows that the fullness of life comes to those who
follow Christ in the way of the Cross. In pursuit of
concrete solutions, all members of the Christian com-
munity are called to an ever finer discernment of the
hurts and opportunities in the world around them,
in order to respond to the most pressing needs and
thus build up a more just society.*® This is a communal
task calling for dialogue, experimentation, and imag-
ination. It also calls for deep faith and courageous
love.

Preface for the Feast of Christ the King, The Sacramentary of
the Roman Missal.

^ Octogesima Adveniens, 26-35.
^ Pastoral Constitution, 39.

’’Ibid.

“ Octogesima Adveniens, 42.

63



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Chapter III

SFT FCTFD

ECONOMIC POLICY ISSUES

127. We have outlined this moral vision as a guide
to all who seek to be faithful to the Gospel in their

daily economic decisions and as a challenge to trans-

form the economic arrangements that shape our lives

and our world. These arrangements embody and com-

municate social values and therefore have moral sig-

nificance both in themselves and in their effects.

Christians, like all people, must be concerned about

how the concrete outcomes of their economic activity

serve human dignity; they must assess the extent to

which the structures and practices of the economy

support or undermine their moral vision.

128. Such an assessment of economic practices,

structures, and outcomes leads to a variety of conclu-

sions. Some people argue that an unfettered free-mar-

ket economy, where owners, workers, and consumers

pursue their enlightened self-interest, provides the

greatest possible liberty, material welfare, and equity.

The policy implication of this view is to intervene in

the economy as little as possible because it is such a

delicate mechanism that any attempt to improve it is

likely to have the opposite effect. Others argue that

the capitalist system is inherently inequitable and

therefore contradictory to the demands of Christian

morality, for it is based on acquisitiveness, competi-

65



tion, and self-centered individualism. They assert that

capitalism is fatally flawed and must be replaced by

a radically different system that abolishes private

property, the profit motive, and the free market.

129. Catholic social teaching has traditionally re-

jected these ideological extremes because they are likely

to produce results contrary to human dignity and eco-

nomic justice.' Starting with the assumption that the

economy has been created by human beings and can

be changed by them, the Church works for improve-

ment in a variety of economic and political contexts;

but it is not the Church's role to create or promote a

specific new economic system. Rather, the Church

must encourage all reforms that hold out hope of

transforming our economic arrangements into a fuller

systemic realization of the Christian moral vision. The

Church must also stand ready to challenge practices

and institutions that impede or carry us farther away

from realizing this vision.

130. In short, the Church is not bound to any par-

ticular economic, political, or social system; it has lived

with many forms of economic and social organization

and will continue to do so, evaluating each according

to moral and ethical principles: What is the impact of

the system on people? Does it support or threaten

human dignity?

131. In this document we offer reflections on the

particular reality that is the U.S. economy. In doing

so we are aware of the need to address not only in-

dividual issues within the economy but also the larger

question of the economic system itself. Our approach

in analyzing the U.S. economy is pragmatic and evolu-

tionary in nature. We live in a "mixed" economic sys-
tem which is the product of a long history of reform

and adjustment. It is in the spirit of this American

pragmatic tradition of reform that we seek to continue

' Octogesima Adventens, 26-41; and On Human Work, 7, 13.

66



the search for a more just economy. Our nation has

many assets to employ in this quest—vast economic,
technological, and human resources and a system of
representative government through which we can all
help shape economic decisions.

132. Although we have chosen in this chapter to
focus primarily on some aspects of the economy where

we think reforms are realistically possible, we also
emphasize that Catholic social teaching bears directly

on larger questions concerning the economic system

itself and the values it expresses—questions that can-
not be ignored in the Catholic vision of economic

justice.^ For example, does our economic system place

more emphasis on maximizing profits than on meet-

ing human needs and fostering human dignity? Does
our economy distribute its benefits equitably or does

it concentrate power and resources in the hands of a

few? Does it promote excessive materialism and in-

dividualism? Does is adequately protect the environ-

ment and the nation's natural resources? Does it direct

too many scarce resources to military purposes? These
and other basic questions about the economy need to
be scrutinized in light of the ethical norms we have
outlined. We urge continuing exploration of these sys-
temic questions in a more comprehensive way than
this document permits.

133. We have selected the following subjects to
address here: 1) employment, 2) poverty, 3) food and

agriculture, and 4) the U.S. role in the global economy.

These topics were chosen because of their relevance

to both the economic "signs of the times" and the

ethical norms of our tradition. Each exemplifies U.S.
policies that are basic to the establishment of economic

justice in the nation and the world, and each illustrates

key moral principles and norms for action from Cath-
olic social teaching. Our treatment of these issues does

' Program of Social Reconstruction, 33-40 .

67



not constitute a comprehensive analysis of the U.S.

economy. We emphasize that these are illustrative
topics intended to exemplify the interaction of moral

values and economic issues in our day, not to encom-

pass all such values and issues. This document is not

a technical blueprint for economic reform. Rather, it

is an attempt to foster a serious moral analysis leading

to a more just economy.

134. In focusing on some of the central economic

issues and choices in American life in the light of moral

principles, we are aware that the movement from
i

principle to policy is complex and difficult and that I

although moral values are essential in determining
j

public policies, they do not dictate specific solutions.

They must interact with empirical data, with histor-

ical, social, and political realities, and with competing

demands on limited resources. The soundness of our

prudential judgments depends not only on the moral

force of our principles, but also on the accuracy of our

information and the validity of our assumptions.

135. Our judgments and recommendations on spe-

cific economic issues, therefore, do not carry the same

moral authority as our statements of universal moral

principles and formal church teaching; the former are

related to circumstances which can change or which

can be interpreted differently by people of good will.

We expect and welcome debate on our specific policy
recommendations. Nevertheless, we want our state-

ments on these matters to be given serious consid-

eration by Catholics as they determine whether their

own moral judgments are consistent with the Gospel

and with Catholic social teaching. We believe that
differences on complex economic questions should be

expressed in a spirit of mutual respect and open dia-

logue.^

^ See The Challenge of Peace: God's Promise and Our Response, 9-

10.

68



A. Employment

136. Full employment is the foundation of a just

economy. The most urgent priority for domestic eco-

nomic policy is the creation of new jobs with adequate

pay and decent working conditions. We must make
it possible as a nation for every one who is seeking a

job to find employment within a reasonable amount

of time. Our emphasis on this goal is based on the

conviction that human work has a special dignity and

is a key to achieving justice in society.'*

137. Employment is a basic right, a right which

protects the freedom of all to participate in the eco-

nomic life of society. It is a right which flows from

the principles of justice which we have outlined above.

Corresponding to this right is the duty on the part of

society to ensure that the right is protected. The im-

portance of this right is evident in the fact that for

most people employment is crucial to self-realization

and essential to the fulfillment of material needs. Since

so few in our economy own productive property, em-

ployment also forms the first line of defense against

poverty. Jobs benefit society as well as workers, for

they enable more people to contribute to the common

good and to the productivity required for a healthy

economy.

1. The Scope and Effects of

Unemployment

138.

Joblessness is becoming a more widespread

and deep-seated problem in our nation. There are

about 8 million people in the United States looking

for a job who cannot find one. They represent about

* On Human Work, 3 .

69



7 percent of the labor force. ^ The official rate of un-

employment does not include those who have given

up looking for work or those who are working part-

time, but want to work full-time. When these cate-

gories are added, it becomes clear that about one-

eighth of the workforce is directly affected by un-

employment.* The severity of the unemployment

problem is compounded by the fact that almost three-

fourths of those who are unemployed receive no un-

employment insurance benefits.^

139. In recent years there has been a steady trend

toward higher and higher levels of unemployment,

even in good times. Between 1950 and 1980 the annual

unemployment rate exceeded current levels only dur-

ing the recession years of 1975 and 1976. Periods of

economic recovery during these three decades brought

unemployment rates down to 3 and 4 percent. Since

1979, however, the rate has generally been above 7

percent.

140. Who are the unemployed? Blacks, Hispanics,
Native Americans, young adults, female heads of

households, and those who are inadequately edu-

cated are represented disproportionately among the

ranks of the unemployed. The unemployment rate

among minorities is almost twice as high as the rate

among whites. For female heads of households the

unemployment rate is over 10 percent. Among black

* U.S. Department of Labor, Bureau of Labor Statistics, The Em-

ployment Situation: April 1986 (May 1986).

‘ Full Employment Action Council, Employment in America: Il-

lusory Recovery in a Decade of Decline (Washington, D.C., February

1985), 19. Calculations based on data from the U.S. Department of

Labor's Bureau of Labor Statistics.

^ U.S. Department of Labor, Bureau of Labor Statistics, The Em-

ployment Situation: August 1985; and U. S. Department of Labor,

Employment and Training Administration, Unemployment Insurance

Claims, Reference week of June 22, 1985.

70



teenagers, unemployment reaches the scandalous rate

of more than one in three."

141. The severe human costs of high unemploy-

ment levels become vividly clear when we examine

the impact of joblessness on human lives and human

dignity. It is a deep conviction of American culture

that work is central to the freedom and well-being of

people. The unemployed often come to feel they are

worthless and without a productive role in society.

Each day they are unemployed our society tells them:

We don't need your talent. We don't need your ini-
tiative. We don't need you. Unemployment takes a
terrible toll on the health and stability of both indi-

viduals and families. It gives rise to family quarrels,

greater consumption of alcohol, child abuse, spouse

abuse, divorce, and higher rates of infant mortality.’

People who are unemployed often feel that society

blames them for being unemployed. Very few people

survive long periods of unemployment without some

psychological damage even if they have sufficient

funds to meet their needs. At the extreme, the strains

• The Employment Situation: August 1985.

’ Brenner, "Fetal, Infant and Maternal Mortality during Periods

of Economic Instability," International journal of Health Services (Sum-

mer 1973); P. H. ElUson, "Neurology of Hard Times," Clinical Pe-

diatrics (March 1977); S. V. Kasl and S. Cobb, "Some Mental Health

Consequences of Plant Qosings and Job Loss," in L. Ferman and

J. P. Gordus, eds.. Mental Health and the Economy (Kalamazoo, Mich.:

W. E. Upjohn Institute for Employment Research, 1979), 255-300;

L. E. Kopolow and F. M. Ochberg, "Spinoff from a Downward

Swing," Mental Health 59 (Summer 1975); D. Shaw, "Unemployment

Hurts More than the Pocketbook," Today's Health (March 1978).

Richard M. Cohn, The Consequences of Unemployment on Eval-

uation of Self, Doctoral dissertation. Department of Psychology (Uni-

versity of Michigan, 1977); John A. Garraty, Unemployment in History:

Economic Thought and Public Policy (New York; Harper and Row,

1978); Harry Maurer, Not Working: An Oral History of the Unemployed

(New York; Holt, Rinehart, and Winston, 1979).

71



of job loss may drive individuals to suicide."

142. In addition to the terrible waste of individual

talent and creativity, unemployment also harms so-

ciety at large. Jobless people pay little or no taxes,

thus lowering the revenues for cities, states, and the

federal government. At the same time, rising un-

employment requires ^eater expenditures for un-

employment compensation, food stamps, welfare, and

other assistance. It is estimated that in 1986, for
every

one percentage point increase in the rate of unem-

ployment, there will be roughly a $40 billion increase

in the federal deficit." The costs to society are also

evident in the rise in crime associated with jobless-

ness. The Federal Bureau of Prisons reports that in-

creases in unemployment have been followed by

increases in the prison population. Other studies have

shown links between the rate of joblessness and the

frequency of homicides, robberies, larcenies, narcotics

arrests, and youth crimes."

143. Our own experiences with the individuals,

families, and communities that suffer the burdens of

unemployment compel us to the conviction that as a

nation we simply cannot afford to have millions of

able-bodied men and women unemployed. We cannot

afford the economic costs, the social dislocation, and

the enormous human tragedies caused by unemploy-

ment. In the end, however, what we can least afford

" M. Harvey Brenner, Estimating the Social Cost of
National Eco-

nomic Policy (U.S. Congress, Joint Economic Committee, 1976);
see

Brenner, Mental Illness and the Economy (Cambridge, Mass.
: Harvard

University Press, 1973).
, l rv

Congressional Budget Office, Economic and Budget Outlook:
FY

J986—FY 1990 (Washington, D.C., February 1985), 75.

Correlation of Unemployment and Federal Prison
Population (Wash-

ington, D.C.: U.S. Bureau of Prisons, March 1975); M.
Yeager,

"Unemployment and Imprisonment," journal of Criminal Law
and

Criminology 70:4 (1979); Testimony of M. H. Brenner in
Unemploy-

ment and Crime (U.S. Congress, House Hearings, 1977,)
25.

72



is the assault on human dignity that occurs when

millions are left without adequate employment.

Therefore, we cannot but conclude that current levels

of unemployment are intolerable, and they impose

on us a moral obligation to work for policies that will

reduce joblessness.

2. Unemployment in a Changing Economy

144. The structure of the U.S. economy is undergo-

ing a transformation that affects both the quantity and

the quality of jobs in our nation. The size and makeup

of the workforce, for example, have changed mark-

edly in recent years. For a number of reasons, there

are now more people in the labor market than ever
before in our history. Population growth has pushed

up the supply of potential workers. In addition, large

numbers of women have entered the labor force not
only in order to put their talents and education to

greater use, but also out of economic necessity. Many
families need two salaries if they are to live in a de-

cently human fashion. Female-headed households of-
ten depend heavily on the mother's income to stay

off the welfare rolls. Immigrants seeking a better ex-

istence in the United States have also added to the

size of the labor force. These demographic changes,

however, cannot fully explain the higher levels of

unemployment.

145. Technological changes are also having dra-

matic impacts on the employment picture in the United

States. Advancing technology brings many benefits,
but it can also bring social and economic costs, in-

cluding the downgrading and displacement of work-

ers. High technology and advanced automation are

changing the very face of our nation's industries and

occupations. In the 1970s, about 90 percent of all new
jobs were in service occupations. By 1990, service in-

dustries are expected to employ 72 percent of the labor

73



force. Much of the job growth in the 1980s is expected

to be in traditionally low-paying, high-tumover jobs

such as sales, clerical, janitorial, and food service.'^

Too often these jobs do not have career ladders leading

to higher skilled, higher paying jobs. Thus, the chang-

ing industrial and occupational mix in the U.S. econ-

omy could result in a shift toward lower paying and

lower skilled jobs.

146. Increased competition in world markets is an-

other factor influencing the rate of joblessness in our

nation. Many other exporting nations have acquired

and developed up-to-the-minute technology, ena-

bling them to increase productivity dramatically.

Combined with very low wages in many nations, this

has allowed them to gain a larger share of the U.S.

market to cut into U.S. export markets. At the same

time many corporations have closed plants in the

United States and moved their capital, technology,

and jobs to foreign affiliates.

147. Discrimination in employment is one of the

causes for high rates of joblessness and low pay among

racial minorities and women. Beyond the normal

problems of locating a job, blacks, Hispanics, Native

Americans, immigrants, and other minorities bear this

added burden of discrimination. Discrimination

against women is compounded by the lack of adequate
child care services and by the unwillingness of many

employers to provide flexible employment or extend

fringe benefits to part-time employees.

148. High levels of defense spending also have an

effect on the number of jobs in our economy. In our

pastoral letter. The Challenge of Peace, we noted the

serious economic distortions caused by the arms race

and the disastrous effects that it has on society's ability

to care for the poor and the needy. Employment is

'* Committee on the Evolution of Work, AFL-CIO, The Future

of Work (Washington, D.C.: AFL-CIO, 1983), 11.

74



one area in which this interconnection is very evident.

The hundreds of billions of dollars spent by our nation

each year on the arms race create a massive drain on

the U.S. economy as well as a very serious "brain

drain." Such spending on the arms race means a net

loss in the number of jobs created in the economy,

because defense industries are less labor-intensive than

other major sectors of the economy.'® Moreover, nearly

half of the American scientific and engineering force

works in defense-related programs and over 60 per-

cent of the enrire federal research and development

budget goes to the military.'* We must ask whether
our nation vsdll ever be able to modernize our economy

and achieve full employment if we continue to devote

so much of our financial and human resources to de-

fense-related activities.

149. These are some of the factors that have driven

up the rate of unemployment in recent years. Al-

though our economy has created more than 20 million

new jobs since 1970,'^ there continues to be a chronic

and growing job shortage. In the face of this challenge.

Congressional Budget Office, Defense Spending and the Economy

(Washington, D.C.: Government Printing Office, 1983). See also

Michael Edelstein, The Economic Impact of Military Spending (New

York: Council on Economic Priorities, 197^; and Robert De Grasse,

Jr., Military Expansion, Economic Decline (New York: Council on

Economic Priorities, 1983). See also U.S. Department of Labor,

Bureau of Labor Statistics Report, "Structure of the U.S. Economy

in 1980 and 1985" (Washington, D.C.: Government Printing Office,

1975); and Marion Anderson, The Empty Pork Barrel (Lansing, Mich.:

Employment Research Associates, 1982).

U.S. Office of Management and Budget, Historical Tables, Budget

of the United States Government Fiscal Year 1986 (Washington,

D.C.: U.S. Government Printing Office, 1985). Table 10.2, 10.2(3).

See also. National Science Foundation Report, "Characteristics of

Experienced Scientists and Engineers" (1978), Detailed Statistical

Tables (Washington, D.C.: U.S. Government Printing Office, 1978).

"Statistical Supplement to International Comparison of Un-

employment," Bureau of Labor Statistics, (May 1984): 7. Unpub-

lished.

75



our nation's economic institutions have failed to adapt

adequately and rapidly enough. For example, failure

to invest sufficiently in certain industries and regions,

inadequate education and training for new workers,

and insufficient mechanisms to assist workers dis-

placed by new technology have added to the unem-

ployment problem.

150.

Generating an adequate number of jobs in our

economy is a complex task in view of the changing

and diverse nature of the problem. It involves nu-

merous trade-offs and substantial costs. Nevertheless,

it is not an impossible task. Achieving the goal of full

employment may require major adjustments and cre-

ative strategies that go beyond the limits of existing

policies and institutions, but it is a task we must un-

dertake.

3. Guidelines for Action

151. We recommend that the nation make a major

new commitment to achieve full employment. At

present there is nominal endorsement of the full em-

ployment ideal, but no firm commitment to bringing

it about. If every effort were now being made to create

the jobs required, one might argue that the situation

today is the best we can do. But such is not the case.

The country is doing far less than it might to generate

employment.

152. Over the last decade, economists, policy mak-

ers, and the general public have shown greater will-

ingness to tolerate unemployment levels of 6 to 7

percent or even more.'* Although we recognize the

'* Isabel V. Sawhill and Charles F. Stone state the prevailing

view among economists this way: "High employment is usually

defined as the rate of unemployment consistent with no additional

inflation, a rate currently believed by many, but not all, economists

to be in the neighborhood of 6 percent." "The Economy; The Key

76



complexities and trade-offs involved in reducing un-

employment, we believe that 6 to 7 percent unem-

ployment is neither inevitable nor acceptable. While

a zero unemployment rate is clearly impossible in an

economy where people are constantly entering the

job market and others are changing jobs, appropriate

policies and concerted private and public action can

improve the situation considerably, if we have the

will to do so. No economy can be considered truly

healthy when so many millions of people are denied

jobs by forces outside their control. The acceptance

of present unemployment rates would have been un-

thinkable twenty years ago. It should be regarded as

intolerable today.

153. We must first establish a consensus that every-
one has a right to employment. Then the burden of

securing full employment falls on all of us—policy
makers, business, labor, and the general public—to
create and implement the mechanisms to protect that

right. We must work for the formation of a new na-
tional consensus and mobilize the necessary political

will at all levels to make the goal of full employment

a reality.

154. Expanding employment in our nation will re-

quire significant steps in both the private and public

sectors, as well as joint action between them. Private

initiative and entrepreneurship are essential to this

task, for the private sector accounts for about 80 per-

cent of the jobs in the United States, and most new

jobs are being created there.” Thus, a viable strategy

for employment generation must assume that a large

to Success/' in John L. Palmer and Isabel V. Sawhill, eds., The

Reagan Record: An Assessment ofAmerica's Changing Domestic Priorities

(Cambridge, Mass.: Bollinger, 1984), 72. See also Stanley Fischer

and Rudiger Dombusch, Economics (New York: McGraw-Hill, 1983),
731-743.

W. L. Birch, "Who Creates Jobs?," The Public Interest 65 (Fall

1981): 3-14.

77



part of the solution will be with private firms and

small businesses. At the same time, it must be rec-

ognized that government has a prominent and indis-

pensable role to play in addressing the problem of

unemployment. The market alone will not automat-

ically produce full employment. Therefore, the gov-

ernment must act to ensure that this goal is achieved

by coordinating general economic policies, by job cre-

ation programs, and by other appropriate policy mea-

sures.

155. Effective action against unemployment wUl

require a careful mix of general economic policies and

targeted employment programs. Taken together, these

policies and programs should have full employment

as their number one goal.

a. General Economic Policies

156. The general or macroeconomic policies of the

federal government are essential tools for encouraging

the steady economic growth that produces more and

better jobs in the economy. We recommend that the fiscal

and monetary policies of the nation—such as federal spend-
ing, tax, and interest rate policies—should be coordinated
so as to achieve the goal of full employment.

157. General economic policies that attempt to ex-

pand employment must also deal with the problem

of inflation.^® The risk of inflationary pressures re-

“ Martin Neil Baily and Arthur M. Okun, eds.. The Battle Against

Unemployment and Inflation, third edition (New York: Norton, 1982);

and Martin Neil Baily, ''Labor Market Performance, Competition

and Inflation," in Baily, ed.. Workers, Jobs and Inflation (Washington,

D.C.: The Brookings Institution, 1982). See also, Lawrence ICein,

"Reducing Unemployment Without Inflation"; and James Tobin,

"Unemployment, Poverty, and Economic Policy," testimony before

the Subcommittee on Economic Stabilization, U S. House of Rep-

resentatives Committee on Banking, Finance and Urban Affairs

(March 19, 1985), serial no. 99-5 (Washington, D.C.: U.S. Govern-

ment Printing Office, 1985), 15-18, 31-33.

78



suiting from such expansionary policies is very real.

Our response to this risk, however, must not be to

abandon the goal of full employment, but to develop

effective policies that keep inflation under control.
158.

While economic growth is an important and

necessary condition for the reduction of unemploy-

ment, it is not sufficient in and of itself. In order to

work for full employment and restrain inflation, it is

also necessary to adopt more specific programs and

policies targeted toward particular aspects of the un-

employment problem.

b. Targeted Employment Programs

159. (1) We recommend expansion of job-training and

apprenticeship programs in the private sector administered

and supported jointly by business, labor unions, and gov-

ernment. Any comprehensive employment strategy

must include systematic means of developing the

technical and professional skills needed for a dynamic

and productive economy. Investment in a skilled work

force is a prerequisite both for sustaining economic

growth and achieving greater justice in the United

States. The obligation to contribute to this investment

falls on both the private and public sectors. Today

business, labor, and government need to coordinate

their efforts and pool their resources to promote a

substantial increase in the number of apprenticeship

programs and to expand on-the-job training pro-

grams. We recommend a national commitment to
eradicate illiteracy and to provide people with the

skills necessary to adapt to the changing demands of

employment.

160. With the rapid pace of technological change.

Tobin, "Unemployment, Poverty, and Economic Policy"; and

Klein, "Reducing Unemployment Without Inflation."

79



continuing education and training are even more im-

portant today than in the past. Businesses have a stake

in providing it, for skilled workers are essential to

increased productivity. Labor unions should support

it, for their members are increasingly vulnerable to

displacement and job loss unless they continue to

develop their skills and their flexibility on the job.

Local communities have a stake as well, for their eco-

nomic well-being will suffer serious harm if local in-

dustries fail to develop and are forced to shut down.

161. The best medicine for the disease of plant-

closings is prevention. Prevention depends not only

on sustained capital investment to enhance produc-

tivity through advanced technology but also on the

training and retraining of workers within the private

sector. In circumstances where plants are forced to

shut down, management, labor unions, and local

communities must see to it that workers are not simply

cast aside. Retraining programs will be even more

urgently needed in these circumstances.

162. (2) We recommend increased support for direct job

creation programs targeted on the long-term unemployed

and those with special needs. Such programs can take

the form of direct public service employment and also

of public subsidies for employment in the private sec-

tor. Both approaches would provide jobs for those

with low skills less expensively and with less inflation

than would general stimulation of the economy.“ The

cost of providing jobs must also be balanced against

the savings realized by the government through de-

creased welfare and unemployment insurance ex-

penditures and increased revenues from the taxes paid

by the newly employed.

163. Government funds, if used effectively, can also

stimulate private sector jobs for the long-term un-

“ Robert H. Haveman, "Toward Efficiency and Equity through

Oirect Job Creation," Social Policy 11;1 (May/June 1980): 48.

80



employed and for groups particularly hard to employ.

Exf)eriments need to be conducted on the precise ways

such subsidies would most successfully attract busi-

ness participation and ensure the generation of per-

manent jobs.

164. These job generation efforts should aim spe-

cifically at bringing marginalized persons into the la-

bor force. They should produce a net increase in the

number of jobs rather than displacing the burden of

unemployment from one group of persons to another.

They should also be aimed at long-term jobs and should

include the necessary supportive services to assist the

unemployed in finding and keeping jobs.

165. Jobs that are created should produce goods

and services needed and valued by society. It is both

good common sense and sound economics to create

jobs directly for the purpose of meeting society's un-

met needs. Across the nation, in every state and lo-

cality, there is ample evidence of social needs that are

going unmet. Many of our parks and recreation fa-

cilities are in need of maintenance and repair. Many

of the nation's bridges and highways are in disrepair.

We have a desperate need for more low-income hous-
ing. Our educational systems, day-care services, sen-

ior citizen services, and other community programs

need to be expanded. These and many other elements

of our national life are areas of unmet need. At the

same time, there are more than 8 million Americans

looking for productive and useful work. Surely we
have the capacity to match these needs by giving

Americans who are anxious to work a chance for pro-

ductive employment in jobs that are waiting to be

done. The overriding moral value of enabling jobless

persons to achieve a new sense of dignity and personal

worth through employment also strongly recom-

mends these programs.

166. These job creation efforts will require in-

creased collaboration and fresh alliances between the

81



private and public sectors at all levels. There are al-

ready a number of examples of how such efforts can

be successful.^ We believe that the potential of these
kinds of partnerships has only begun to be tapped.

c. Examining New Strategies

167. In addition to the actions suggested above,

we believe there is also a need for careful examination

and experimentation with alternative approaches that

might improve both the quantity and quality of jobs.

More extensive use of job sharing, flex time, and a

reduced work week are among the topics that should

continue to be on the agenda of public discussion.

Consideration should also be given to the possibility

of limiting or abolishing compulsory overtime work.

Similarly, methods might be examined to discourage

the overuse of part-time workers, who do not receive

fringe benefits. New strategies also need to be ex-
plored in the area of education and training for the

hard-to-employ, displaced workers, the handicapped,

and others with special needs. Particular attention is

needed to achieve pay equity between men and

“ William H. McCarthy, Reducing Urban Unemployment: What

Works at the Local Level (Washington, D.C.: National League of

Cities, October 1985); William Schweke, "States that Take the Lead

on a New Industrial Policy," in Betty G. Lall, ed.. Economic Dislo-
cation and Job Loss (New York: Cornell University, New York State

School of Industrial and Labor Relations, 1985), 97-106; David Rob-

inson, Training and Jobs Programs in Action: Case Studies in Private

Sector Initiatives for the Hard to Employ (New York: Committee for

Economic Development, 1978). See also ch. IV of this pastoral letter.

^ Rudy Oswald, "The Economy and Workers' Jobs, The Living

Wage and a Voice," in John W. Houch and Oliver F. Williams,

eds., Catholic Social Teaching and the U.S. Economy: Working Papers

fora Bishops' Pastoral (Washington, D.C.: University Press of Amer-

ica, 1984), 77-89. On the subject of shortening the work week,

Oswald points out that in the first 40 years of this century, the

average work week fell from 60 hours to 40 hours. However, the

standard work week has been unchanged now for almost 50 years.

82



women, as well as upgrading the pay scale and work-

ing conditions of traditionally low-paying jobs. The

nation should renew its efforts to develop effective

affirmative action policies that assist those who have

been excluded by racial or sexual discrimination in

the past. New strategies for improving job placement

services at the nation^ and local levels are also needed.

Improving occupational safety is another important

concern that deserves increased attention.

168. Much greater attention also needs to be de-

voted to the long-term task of converting some of the

nation's military production to more peaceful and so-

cially productive purposes. The nation needs to seek

more effective ways to retool industries, to retreun

workers, and to provide the necessary adjustment

assistance for communities affected by this kind of

economic conversion.

169. These are among the avenues that need to be

explored in the search for just employment policies.

A belief in the inherent dignity of human work and
in the right to employment should motivate people

in all sectors of society to carry on that search in new

and creative ways.

B. Poverty

170.

More than 33 million Americans—about one
in every seven people in our nation—are poor by the
government's official definition. The norms of human

dignity and the preferential option for the poorcompel

us to confront this issue with a sense of urgency.

Dealing with poverty is not a luxury to which our

nation can attend when it finds the time and re-

sources. Rather, it is a moral imperative of the highest

priority.

83



171. Of particular concern is the fact that poverty

has increased dramatically during the last decade. Since

1973 the poverty rate has increased by nearly a third.

Although the recent recovery has brought a slight

decline in the rate, it remains at a level that is higher

than at almost any other time during the last two

decades.
“

172. As pastors we have seen firsthand the faces

of poverty in our midst. Homeless people roam city

streets in tattered clothing and sleep in doorways or

on subway grates at night. Many of these are former

mental patients released from state hospitals. Thou-

sands stand in line at soup kitchens because they have

no other way of feeding themselves. Millions of chil-

dren are so poorly nourished that their physical and

mental development are seriously harmed. We have
also seen the growing economic hardship and inse-

curity experienced by moderate-income Americans

when they lose their jobs and their income due to

forces beyond their control. These are alarming signs

and trends. They pose for our nation an urgent moral

and human challenge: to fashion a society where no

one goes without the basic material necessities re-

quired for human dignity and growth.

173. Poverty can be described and defined in many

different ways. It can include spiritual as well as ma-

terial poverty. Likewise, its meaning changes de-

pending on the historical, social, and economic setting.

Poverty in our hme is different from the more severe

deprivation experienced in earlier centuries in the U.S.

or in Third World nations today. Our discussion of

poverty in this chapter is set within the context of

“U.S. Bureau of the Census, Current Population Reports, Series

P-60, no. 149, hAoney Income and Poverty Status of Families in the United

States: 1984 (Washington, D.C.: U.S. Government Printing Office,

1985).

“ Massachusetts Department of Public Health, Massachusetts

Nutrition Survey (Boston, Mass.: 1983).

84



present-day American society. By poverty, we are re-

ferring here to the lack of sufficient material resources

required for a decent life. We use the government's
official definition of poverty, although we recognize

its limits.^

1. Characteristics of Poverty

174. Poverty is not an isolated problem existing

solely among a small number of anonymous people

in our central cities. Nor is it limited to a dependent

underclass or to specific groups in the United States.

It is a condition experienced at some time by many

people in different walks of life and in different cir-

cumstances. Many poor people are working but at

”
There is considerable debate about the most suitable definition

of poverty. Some argue that the government's official definition

understates the number of the poor, and that a more adequate

definition would indicate that as many as 50 million Americans are

poor. For example, they note that the poverty line has declined

sharply as a percent of median family income—from 48% in 1959
to 35% in 19^. Others argue that the official indicators should be

reduced by the amount of in-kind benefits received by the poor,

such as food stamps. By some calculations that would reduce the

number counted as poor to about 12 million. We conclude that for
present purposes the official government definition provides a suit-

able middle ground. That definition is based on a calculation that

multiplies the cost of USDA's lowest cost food plan times three.

The definition is adjusted for inflation each year.

Among other reasons for using the official definition is that it

allows one to compare poverty figures over time. For additional

readings on this topic see: L. Rainwater, W/wf Money Buys: Inequality

and the Social Meanings of Income (New York: Basic Books, 1975); id..

Persistent and Transitory Poverty: A New Look (Cambridge, Mass.:

Joint Center for Urban Studies, 1980); M. Orshansky, "How Poverty

is Measured," Monthly Labor Review 92 (1969): 37-41; M. Anderson,

Welfare (Stanford, Calif.: Hoover Institution Press, 1978); and Mi-

chael Harrington, The New American Poverty (New York: Holt, Rine-

hart, and Winston, 1984), 81-82.

85



wages insufficient to lift them out of poverty.^ Others

are unable to work and therefore dependent on out-

side sources of support. Still others are on the edge

of poverty; although not officially defined as poor,

they are economically insecure and at risk of falling

into poverty.

175. While many of the poor manage to escape

from beneath the official poverty line, others remain

poor for extended periods of time. Long-term poverty

is concentrated among racial minorities and families

headed by women. It is also more likely to be found

in rural areas and in the South.^ Of the long-term

poor, most are either working at wages too low to

bring them above the poverty line or are retired, dis-

abled, or parents of preschool children. Generally they

are not in a position to work more hours than they

do now.^

“ Of those in poverty, 3 million work year-round and are still

poor. Of the 22.2 million poor who are 15 years or over, more than

9 million work sometime during the year. Since 1979, the largest

increases of poverty in absolute terms have been among those who

work and are still poor. U.S. Bureau of the Census, Money, Income

and Poverty.

” U.S. Bureau of the Census, Current Population Reports, series

P-60, no. 149, 19. Blacks make up about 12% of the entire population

but 62% of the long-term poor. Only 19% of the overall population

live in families headed by women, but they make up 61% of the

long-term poor. Twenty-eight percent of the nation's total popu-

lation reside in nonmetropolitan areas, but 34% of the nation's poor

live in these areas.

* G. J. Duncan et al.. Years ofPoverty, Years of Plenty: The Changing

Economic Fortunes of American Workers and Their Families (Ann Arbor,

Mich.: Institute for Social Research, The University of Michigan,

1984). This book is based on the Panel Study of Income Dynamics,

a survey of 5,(X)0 American families conducted annually by the

Survey Research Center of the University of Michigan. See G. J.

Duncan and ]. N. Morgan, Five Thousand American Families—Patterns
of Economic Progress vol. Ill (Ann Arbor: University of Michigan,

1975).

86



a. Children in Poverty

176. Poverty strikes some groups more severely

than others. Perhaps most distressing is the growing

number of children who are poor. Today one in every

four American chUdren under the age of six, and one

in every two black children under six, are poor. The

number of children in poverty rose by four million

over the decade between 1973 and 1983, with the

result that there are now more poor children in the

United States than at any time since 1965.^’ The prob-

lem is particularly severe among female-headed fam-

ilies, where more than half of all children are poor.

Two-thirds of black children and nearly three-quarters

of Hispanic children in such families are poor.

177. Very many poor families with children receive

no government assistance, have no health insurance,

and cannot pay medical bills. Less than half are im-

munized against preventable diseases such as diphth-

eria and polio.“ Poor children are disadvantaged even

before birth; their mothers' lack of access to high qual-

ity prenatal care leaves them at much greater risk of

premature birth, low-birth weight, physical and men-

tal impairment, and death before their first birthday.

b. Women and Poverty

178. The past twenty years have witnessed a dra-

matic increase in the number of women in poverty.”

Congressional Research Service and Congressional Budget

Office, Children in Poverty (Washington, D.C., May 22, 1985), 57.

This recent study also indicates that children are now the largest

age group in poverty. We are the first industrialized nation in the
world in which children are the poorest age group. See Daniel

Patrick Moynihan, Family and Nation (New York: Harcourt, Brace,

Jovanovich, 1986), 112.

“ Children's Defense Fund, American Children in Poverty (Wash-

ington, D.C., 1984).

® This trend has been commonly referred to as the "feminization

87



This includes women raising children alone as well

as women with inadequate income following divorce,
widowhood, or retirement. More than one-third of all

female-headed families are poor. Among minority

families headed by women the poverty rate is over 50
percent.^

179. Wage discrimination against women is a ma-

jor factor behind these high rates of poverty. Many

women are employed but remain poor because their
wages are too low. Women who work outside their
homes full-time and year-round earn only 61 percent

of what men earn. Thus, being employed full-time is

not by itself a remedy for poverty among women.

Hundreds of thousands of women hold full-time jobs
but are still poor. Sixty percent of all women work in

only ten occupations, and most new jobs for women

are in areas with low pay and limited chances of ad-

vancement. Many women suffer discrimination in

wages, salaries, job classifications, promotions, and

other areas. As a result, they find themselves in jobs

that have low status, little security, weak unioniza-

tion, and few fringe benefits. Such discrimination is

immoral and efforts must be made to overcome the

effects of sexism in our society.

180. Women's responsibilities for childrearing are

another important factor to be considered. Despite

the many changes in marriage and family life in recent

decades, women continue to have primary respon-

of poverty." This term was coined by Dr. Diana Pierce in the 1980

Report to the President of the National Advisory Council on Economic

Opportunity to describe the dramatic increase in the proportion of

the poor living in female-headed households.

“ U.S. Bureau of the Census, Technical Paper 55, Estimates of

Poverty Including the Value of Non-Cash Benefits: 1984 (Washington,

D.C., August 1985), 5, 23.

“ Barbara Raskin and Heidi Hartmann, Women's Wort, Men's

Work, Sex Segregation on the lob. National Academy of Sciences

(Washington, D.C.: National Academy Press, 1986), pp. 10-126.

88



sibility in this area. When marriages break up, moth-

ers typically take custody of the children and bear the

major financial responsibility for supporting them.

Women often anticipate that they will leave the labor

force to have and raise children, and often make job

and career choices accordingly. In other cases they

are not hired or promoted to higher paying jobs be-

cause of their childrearing responsibilities. In addi-

tion, most divorced or separated mothers do not get

child support payments. In 1983, less than half of

women raising children alone had been awarded child

support, and of those, only half received the full

amount to which they were entitled. Even fewer

women (14 percent) are awarded alimony, and many

older women are left in poverty after a lifetime of

homemaking and childrearing.^ Such women have

great difficulty finding jobs and securing health in-

surance.

c. Racial Minorities and Poverty

181. Most poor people in our nation are white, but

the rates of poverty in our nation are highest among

those who have borne the brunt of racial prejudice

and discrimination. For example, blacks are alwut three

times more likely to be poor than whites. While one

out of every nine white Americans is poor, one of

every three blacks and Native Americans and more

than one of every four Hispanics are poor.*^ While

some members of minority communities have sue-

^ U.S. Bureau of the Census, series P-23, no. 124, Special Study

Child Support and Alimony: 1981 Current Population Report (Wash-

ington, D.C., 1981).

^ U.S. House of Representatives Subcommittee on Oversight

and Public Assistance and Unemployment Compensation, Com-

mittee on Ways and Means, Background Material on Poverty (Wash-

ington, D.C., October, 1983). See also Committee on Ways and

Means, U.S. House of Representatives, Children in Poverty, 3.

89



cessfully moved up the economic ladder, the overall

picture indicates that black family income is only 55

percent of white family income, reflecting an income

gap that is wider now than at any time in the last

fifteen years.’®

182. Despite the gains which have been made to-

ward racial equality, prejudice and discrimination in

our own time as well as the effects of past discrimi-

nation continue to exclude many members of racial

minorities from the mainstream of American life. Dis-

criminatory practices in labor markets, in educational

systems, and in electoral politics create major obsta-

cles for blacks, Hispanics, Native Americans, and other

racial minorities in their struggle to improve their eco-

nomic status.” Such discrimination is evidence of the

continuing presence of racism in our midst. In our

pastoral letter. Brothers and Sisters to Us, we have de-

scribed this racism as a sin
—

"a sin that divides the

human family, blots out the image of God among

specific members of that family, and violates the fun-

damental human dignity of those called to be children

of the same Father.'"*®

2. Economic Inequality

183. Important to our discussion of poverty in

America is an understanding of the degree of eco-

nomic inequality in our nation. Our economy is marked

by a very uneven distribution of wealth and income.

For example, it is estimated that 28 percent of the total

net wealth is held by the richest 2 percent of families

in the United States. The top ten percent holds 57

“ The National Urban League, The Status of Black America 1984

(New York, January 1984).
^ Ibid.

^ NCCB, Brothers and Sisters to Us Pastoral Letter on Racism in

Our Day (Washington, D.C.: USCC Office of Publishing and Pro-

motion Services, 1979).

90



percent of the net wealth.'" If homes and other real

estate are excluded, the concentration of ownership

of "financial wealth" is even more glaring. In 1983,

54 percent of the total net financial assets were held

by 2 percent of all families, those whose annual in-

come is over $125,000. Eighty-six percent of these as-

sets were held by the top 10 percent of all families.

184. Although disparities in the distribution of in-

come are less extreme, they are still striking. In 1984

the bottom 20 percent of American families received

only 4.7 percent of the total income in the nation and

the bottom 40 percent received only 15.7 percent, the

lowest share on record in U.S. history. In contrast,

the top one-fifth received 42.9 percent of the total

income, the highest share since 1948.'“ These figures

are only partial and very imperfect measures of the

inequality in our society.“ However, they do suggest

that the degree of inequality is quite large. In com-

parison with other industrialized nations, the United

States is among the more unequal in terms of income

Federal Reserve Board, "Survey of Consumer Finances, 1983:

A Second Report," reprint from the Federal Reserve Bulletin (Wash-

ington, D.C., December 1984), 857-868. This survey defines net

worth as the difference between gross assets and gross liabilities.

The survey's estimates include all financial assets, equity in homes

and other real property, as well as all financial liabilities such as

consumer credit and other debts.

^ Ibid., 863-864.
^

U.S. Bureau of the Census, series P-60, no. 149, 11.
**
Income distribution figures give only a static picture of income

shares. They do not reflect the significant movement of families

into and out of different income categories over an extended period

of time. See Years of Poverty, Years of Plenty, 13. It should also be

noted that these figures reflect pre-tax incomes. However, since

the national tax structure is proportional for a large segment of the

population, it does not have a significant impact on the distribution

of income. See Joseph Pechman, Who Paid Taxes, 2966-85? (Wash-

ington, D.C.: The Brookings Institution, 1985), 51.

91



distribution/® Moreover, the gap between rich and

poor in our nation has increased during the last dec-

ade.'^ These inequities are of particular concern be-

cause they reflect the uneven distribution of power

in our society. They suggest that the level of partic-

ipation in the political and social spheres is also very

uneven.

185. Catholic social teaching does not require ab-

solute equality in the distribution of income and

wealth. Some degree of inequality not only is ac-

ceptable, but also may be considered desirable for

economic and social reasons, such as the need for

incentives and the provision of greater rewards for

greater risks. However, unequal distribution should

be evaluated in terms of several moral principles we

have enunciated: the priority of meeting the basic

needs of the poor and the importance of increasing

the level of participation by all members of society in

the economic life of the nation. These norms establish

a strong presumption against extreme inequality of

income and wealth as long as there are poor, hungry,

and homeless people in our midst. They also suggest

that extreme inequalities are detrimental to the de-

velopment of social solidarity and community. In view

of these norms we find the disparities of income and

wealth in the United States to be unacceptable. Justice

requires that all members of our society work for eco-

nomic, political, and social reforms that will decrease

these inequities.

3. Guidelines for Action

186. Our recommendations for dealing with pov-

erty in the United States build upon several moral

^ Lars Osberg, Economic Inequality in the United States (New York:

M. E. Sharpe, Inc., 1984), 24-28.

^ U.S. Bureau of the Census, series P-60, no. 149, 11.

92



principles that were explored in chapter two of this

letter. The themes of human dignity and the prefer-

ential option for the poor are at the heart of our ap-

proach; they compel us to confront the issue of poverty

with a real sense of urgency.

187. The principle of social solidarity suggests that

alleviating poverty will require fundamental changes

in social and economic structures that perpetuate glar-

ing inequalities and cut off millions of citizens from

full participation in the economic and social life of the

nation. The process of change should be one that

draws together all citizens, whatever their economic

status, into one community.

188. The principle of participation leads us to the

conviction that the most appropriate and fundamental

solutions to poverty will be those that enable people

to take control of their own lives. For poverty is not

merely the lack of adequate financial resources. It en-

tails a more profound Wnd of deprivation, a denial of

full participation in the economic, social, and political

life of society and an inability to influence decisions

that affect one's life. It means being powerless in a

way that assaults not only one's pocketbook but also

one's fundamental human dignity. Therefore, we

should seek solutions that enable the poor to help

themselves through such means as employment. Pa-

ternalistic programs which do too much for and too

little with the poor are to be avoided.

189. The responsibility for alleviating the plight of

the poor falls upon all members of society. As indi-

viduals, all citizens have a duty to assist the poor

through acts of charity and personal commitment. But

private charity and voluntary action are not sufficient.

We also carry out our moral responsibility to assist
and empower the poor by working collectively through

government to establish just and effective public pol-

icies.

93



190. Although the task of alleviating poverty is

complex and demanding, we should be encouraged

by examples of our nation's past successes in this area.

Our history shows that we can reduce poverty. During

the 1960s and early 1970s, the official poverty rate was

cut in half, due not only to a healthy economy, but

also to public policy decisions that improved the na-

tion's income transfer programs. It is estimated, for

example, that in the late 1970s federal benefit pro-

grams were lifting out of poverty about 70 percent of

those who would have otherwise been poor.^^

191. During the last twenty-five years, the Social

Security Program has dramatically reduced poverty

among the elderly."^ In addition, in 1983 it lifted out

of poverty almost 1.5 million children of retired, de-

ceased, and disabled workers. Medicare has en-

hanced the life expectancy and health status of elderly

and disabled people, and Medicaid has reduced infant

mortality and greatly improved access to health care

for the poor.“

"Poverty in the United States: Where Do We Stand Now?"
Focus (University of Wisconsin: Institute for Research on Poverty,

Winter 1984). See also Danzinger and Gottschalk, "The Poverty of

Losing Ground," Challenge 28:2 (May/June 1985). As these studies

indicate, the slowing of the economy after 1969 tended to push

more people into poverty, a trend that was offset to a great extent

by the broadening of federal benefit programs. Likewise, the cut-

backs in federal programs for the poor in recent years have con-

tributed to the increase in poverty. For other analyses of the causes

and cures of poverty see Charles Murray, Losing Ground: American

Social Policy 1950-1980 (New York: Basic Books, Inc., 1984); Ben J.
Wattenberg, The Good News Is the Bad Nezvs Is Wrong (New York:

Simon and Shuster, 1984); and Michael Harrington, The New Amer-

ican Poverty (New York: Holt, Rinehart, and Winston, 1984).
^ Family and Nation, 111-113.

Committee on Ways and Means, Children In Poverty. Calcu-

lation based on Tables 6-1 and 6-2, 180-181; and estimates of social

insurance transfers on 221-222.

” Paul Starr, The Social Transformation of American Medicine (New

York: Basic Books, Inc., 1982), 373.

94



192. These and other successful social welfare pro-

grams are evidence of our nation's commitment to

social justice and a decent life for everyone. They also

indicate that we have the capacity to design programs

that are effective and provide necessary assistance to

the needy in a way that respects their dignity. Yet it

is evident that not all social welfare programs have

been successful. Some have been ill-designed, inef-

fective, and wasteful. No one has been more aware

of this than the poor themselves, who have suffered

the consequences. Where programs have failed, we

should discard them, learn from our mistakes, and

fashion a better alternative. Where programs have

succeeded, we should acknowledge that fact and build

on those successes. In every instance, we must sum-

mon a new creativity and commitment to eradicate

poverty in our midst and to guarantee all Americans

their right to share in the blessings of our land.

193. Before discussing directions for reform in pub-

lic policy, we must speak frankly about misunder-

standings and stereotypes of the poor. For example,

a common misconception is that most of the poor are

racial minorities. In fact, about two-thirds of the poor

are white.*' It is also frequently suggested that people

stay on welfare for many years, do not work, could

work if they wanted to, and have children who will

be on welfare. In fact, reliable data show that these

are not accurate descriptions of most people who are

poor and on welfare. Over a decade people move on

and off welfare, and less than 1 percent obtain these

benefits for all ten years. Nor is it true that the rolls

of Aid to Families with Dependent Children (AFDC)

are filled with able-bodied adults who could but will

not work. The majority of AFDC recipients are young

U.S. Bureau of the Census, series P-60, no. 149, 11.

® Years of Poverty, Years of Plenty, 13.

95



children and their mothers who must remain at home.®

These mothers are also accused of having more chil-

dren so that they can raise their allowances. The truth

is that 70 percent of AFDC families have only one or
two children and that there is little financial advantage

in having another. In a given year, almost half of all

families who receive AFDC include an adult who has
worked full or part-time.® Research has consistently

demonstrated that people who are poor have the same

strong desire to work that characterizes the rest of the

population.®

194. We ask everyone to refrain from actions,
words, or attitudes that stigmatize the poor, that ex-

aggerate the benefits received by the poor, and that

inflate the amount of fraud in welfare payments.®

These are symptoms of a punitive attitude towards

the poor. The belief persists in this country that the

poor are poor by choice or through laziness, that any-

one can escape poverty by hard work, and that welfare

programs make it easier for people to avoid work.

Thus, public attitudes toward programs for the poor

tend to differ sharply from attitudes about other ben-

efits and programs. Some of the most generous sub-

” Center on Social Welfare Policy and Law, Beyond the Myths:

The Families Helped by the AFDC Program (New York, 1985).
^ Ibid. This booklet cites Census Bureau data showing that in

1980 about 45% of those families who received AFDC also had

earned income during that year, and that the average number of

weeks worked during the year was 32.1.

“ Leonard Goodwin, Causes and Cures of Welfare (Lexington,

Mass.: Lexington Books, 1983), ch. 1. See also Leonard Goodwin,

"Can Workfare Work?" Public Welfare 39 (Fall 1981): 19-25.

^ Beyond the Myths. With respect to error and fraud rates in

AFDC, this booklet notes that erroneous payments in the AFEXT

program account for less than 10% of the benefits paid. No more

than 8.1% of the families on AFDC received overpayments as a

result of client error. In less than 4.5% of all AFDC cases nationally
are questions of fraud raised. Moreover, in over 40% of these cases,

a review of the facts indicated that there was insufficient evidence

to support an allegation of fraud.

96



sidies for individuals and corporations are taken for

granted and are not even called benefits but entitle-

ments.* *^ In contrast, programs for the poor are called

handouts and receive a great deal of critical attention,

even though they account for less than 10 percent of

the federal budget.**

195. We now wish to propose several elements
which we believe are necessary for a national strategy

to deal with poverty. We offer this not as a compre-
hensive list but as an invitation for others to join the

discussion and take up the task of fighting poverty.

196. a. The first line of attack against poverty must be

to build and sustain a healthy economy that provides em-

ployment opportunities at just wages for all adults who are

able to work. Poverty is inhmately linked to the issue

of employment. MUlions are poor because they have

lost their jobs or because their wages are too low. The

persistent high levels of unemployment during the

last decade are a major reason why poverty has in-

creased in recent years.*’ Expanded employment es-

pecially in the private sector would promote human

dignity, increase social solidarity, and promote self-

reliance of the poor. It should also reduce the need

for welfare programs and generate the income nec-

essary to support those who remain in need and can-

not work: elderly, disabled, and chronically ill people,

and single parents of young children. It should also

be recognized that the persistence of poverty harms

the larger society because the depressed purchasing

power of the poor contributes to the periodic cycles

of stagnation in the economy.

^
P. G. Peterson, "No More Free Lunch for the Middle Class,"

New York Times Magazine (January 17, 1982).
“ Interfaith Action for Economic Justice, End Results: The Impact

of Federal Policies Since 1980 on Low-Income Americans (Washington,

D.C.), 2.

* "The Poverty of Losing Ground," 32-38.

97



197. In recent years the minimum wage has not

been adjusted to keep pace with inflation. Its real

value has declined by 24 percent since 1981. We be-
lieve Congress should raise the minimum wage in

order to restore some of the purchasing power it has

lost due to inflation.

198. While job creation and just wages are major

elements of a national strategy against poverty, they

are clearly not enough. Other more specific policies

are necessary to remedy the institutional causes of

poverty and to provide for those who cannot work.

199. b. Vigorous action should be undertaken to remove

barriers to full and equal employment for women and mi-

norities. Too many women and minorities are locked

into jobs with low pay, poor working conditions, and

little opportunity for career advancement. So long as

we tolerate a situation in which people can work full-

time and still be below the poverty line—a situation
common among those earning the minimum wage

—

too many will continue to be counted among the

"working poor." Concerted efforts must be made

through job training, affirmative action, and other

means to assist those now prevented from obtaining

more lucrative jobs. Action should also be taken to

upgrade poorer paying jobs and to correct wage dif-

ferentials that discriminate unjustly against women.

200. c. Self-help efforts among the poor should befostered

by programs and policies in both the private and public

sectors. We believe that an effective way to attack pov-
erty is through programs that are small in scale, locally

based, and oriented toward empowering the poor to

become self-sufficient. Corporations, private organi-

zations, and the public sector can provide seed money,

training and technical assistance, and organizational

support for self-help projects in a wide variety of areas

such as low-income housing, credit unions, worker

cooperatives, legal assistance, and neighborhood and

community organizations. Efforts that enable the poor

98



to participate in the ownership and control of eco-

nomic resources are especially important.

201. Poor people must be empowered to take charge

of their own futures and become responsible for their

own economic advancement. Personal motivation and

initiative, combined with social reform, are necessary

elements to assist individuals in escaping poverty. By

taking advantage of opportunities for education, em-

ployment, and training, and by working together for

change, the poor can help themselves to be full par-

ticipants in our economic, social, and political life.

202. d. The tax system should be continually evaluated

in terms of its impact on the poor. This evaluation should

be guided by three principles. First, the tax system

should raise adequate revenues to pay for the public

needs of society, especially to meet the basic needs

of the poor. Secondly, the tax system should be struc-

tured according to the principle of progressivity, so

that those with relatively greater financial resources

pay a higher rate of taxation. The inclusion of such a

principle in tax policies is an important means of re-

ducing the severe inequalities of income and wealth

in the nation. Action should be taken to reduce or

offset the fact that most sales taxes and payroll taxes

place a disproportionate burden on those with lower

incomes. Thirdly, families below the official poverty

line should not be required to pay income taxes. Such

families are, by definition, without sufficient re-

sources to purchase the basic necessities of life. They

should not be forced to bear the additional burden of

paying income taxes.*®

203. e. All of society should make a much stronger com-

mitment to education for the poor. Any long-term solution

to poverty in this country must pay serious attention

“ The tax reform legislation of 1986 did a great deal to achieve

this goal. It removed from the federal income tax rolls virtually all

families below the official poverty line.

99



to education, public and private, in school and out of

school. Lack of adequate education, especially in the

inner city setting, prevents many poor people from

escaping poverty. In addition, illiteracy, a problem

that affects tens of millions of Americans, condemns

many to joblessness or chronically low wages. More-

over, it excludes them in many ways from sharing in

the political and spiritual life of the community.*’ Since

poverty is fundamentally a problem of powerlessness

and marginalization, the importance of education as

a means of overcoming it cannot be overemphasized.

204. Working to improve education in our society

is an investment in the future, an investment that

should include both the public and private school

systems. Our Catholic schools have the well-merited

reputation of providing excellent education, especially

for the poor. Catholic inner-city schools provide an

otherwise unavailable education^ alternative for many

poor families. They provide one effective vehicle for

disadvantaged students to lift themselves out of pov-

erty. We commend the work of all those who make
great sacrifices to maintain these inner-city schools.

We pledge ourselves to continue the effort to make
Catholic schools models of education for the poor.

205. We also wish to affirm our strong support for
the public school system in the United States. There

can be no substitute for quality education in public

schools, for that is where the large majority of all

students, including Catholic students, are educated.

In Catholic social teaching, basic education is a fun-

damental human right.“ In our society a strong public

school system is essential if we are to protect that right

and allow everyone to develop to their maximum abil-

ity. Therefore, we strongly endorse the recent calls

*' Jonathan Kozol, Illiterate America (New York: Anchor Press/

Doubleday, 1985).

“ Peace on Earth, 13.

100



for improvements in and support for public education,

including improving the quality of teaching and en-

hancing the rewards for the teaching profession.^ At

all levels of education we need to improve the ability

of our institutions to provide the personal and tech-

nical skills that are necessary for participation not only

in today's labor market but also in contemporary so-

ciety.

206. f . Policies and programs at all levels should support

the strength and stability of families, especially those ad-

versely affected by the economy. As a nation, we need to

examine all aspects of economic life and assess their

effects on families. Employment practices, health in-

surance policies, income security programs, tax pol-

icy, and service programs can either support or

undermine the abilities of families to fulfill their roles

in nurturing children and caring for infirm and de-

pendent family members.

207. We affirm the principle enunciated by John
Paul 11 that society's institutions and policies should

be structured so that mothers of young children are

not forced by economic necessity to leave their chil-

^ These reports and studies include: E. Boyer, High School: A
Report on Secondary Education in America (Princeton: Carnegie Foun-

dation for the Advancement of Teaching, 1983); P. Cusick, The

American High School and the Egalitarian Ideal (New York: Longman,

1983); J. I. Goodlad, A Place Called School: Prospects for the Future

(New York: McGraw-Hill, 1983); The National Commission on Ex-

cellence in Education, A Nation at Risk: The Imperative for Educational

Reform (Washington, D.C.: U.S. Department of Education, 1983);

D. Ravitch, The Troubled Crusade: American Education, 1945-1980 (New

York: Basic Books, 1983); T. R. Sizer, Horace's Compromise: The Di-

lemma of the American High School (Boston: Houghton Mifflin, 1984);

Task Force on Education for Economic Growth, Action for Excellence:

A Comprehensive Plan to Improve our Nation's Schools (Denver: Edu-
cation Commission of the States, 1983); and The Twentieth Century

Fund Task Force on Federal Elementary and Secondary Education

Policy, Making the Grade (New York: Twentieth Century Fund, 1983).

For a discussion of the issues raised in these reports see Harvard

Educational Review 54:1 (February 1984): 1-31.

101



dren for jobs outside the home.^ The nation's social

welfare and tax policies should support parents' de-

cisions to care for their own children and should rec-

ognize the work of parents in the home because of

its value for the family and for society.

208. For those children whose parents do work

outside the home, there is a serious shortage of af-

fordable, quality day care. Employers, governments,

and private agencies need to improve both the avail-

ability and the quality of child care services. Likewise,

families could be assisted by the establishment of pa-

rental leave policies that would assure job security for

new parents.

209. The high rate of divorce and the alarming ex-

tent of teenage pregnancies in our nation are distress-

ing signs of the bre^down of traditional family values.

These destructive trends are present in all sectors of

society: rich and poor; white, black, and brown; urban

and rural. However, for the poor they tend to be more

visible and to have more damaging economic con-

sequences. These destructive trends must be coun-

tered by a revived sense of personal responsibility and

commitment to family values.

210. g. A thorough reform of the nation's welfare and

income-support programs should be undertaken. For mil-

lions of poor Americans the only economic safety net

is the public welfare system. The programs that make

up this system should serve the needs of the poor in

a manner that respects their dignity and provides ad-

equate support. In our judgment the present welfare

system does not adequately meet these criteria.“ We

^ The Vatican, Charter of the Rights of the Family (Washington,

D.C.: USCC Office of Publishing and Promotion Services, 1983).

See also On Human Work, 19; Familiaris Consortio, 23, 81; and "Chris-

tian Solidarity Leads to Action," Address to Austrian Workers (Vi-

enna, September 1983) in Origins 13:16 (September 29, 1983): 275.
^
H. R. Rodgers, Jr., The Cost of Human Neglect: America's Welfare

(Armonk, N.Y.: W. E. Sharpe, Inc., 1982); C. T. Waxman, The Stigma

102



believe that several improvements can and should be

made within the framework of existing welfare pro-

grams. However, in the long run, more far-reaching

reforms that go beyond the present system will be

necessary. Among the immediate improvements that

could be made are the following:

211. (1) Public assistance programs should be designed

to assist recipients, wherever possible, to become self-suf-

ficient through gainful employment. Individuals should

not be worse off economically when they get jobs than

when they rely only on public assistance. Under cur-

rent rules, people who give up welfare benefits to

work in low-paying jobs soon lose their Medicaid ben-

efits. To help recipients become self-sufficient and

reduce dependency on welfare, public assistance pro-

grams should work in tandem with job creation pro-

grams that include provisions for training, counseling,

placement, and child care. Jobs for recipients of public

assistance should be fairly compensated so that work-

ers receive the full benefits and status associated with

gainful employment.

212. (2) Welfare programs should provide recipients xoith

adequate levels of support. This support should cover

basic needs in food, clothing, shelter, health care, and

other essentials. At present only 4 percent of poor

families with children receive enough cash welfare

benefits to lift them out of poverty.** The combined

benefits of AFDC and food stamps typically come to
less than three-fourths of the official povei^ level. *^

of Poverty, second edition (New York: Pergamon Press, 1983), es-

pecially ch. 5; and S. A. Levitan and C. M. Johnson, Beyond the

Safety Net: RevivinQ the Promise of Opportunity in America (Cambridee,

Mass.: Ballinger, 1984).

“ Children in Poverty.

*^11.5. House of Representatives Committee on Ways and Means,

Background Materials and Data on Programs Within the Jurisdiction of

the Committee on Ways and Means (Washington, D.C., February 22,

1985), 345-346.

103



Those receiving public assistance should not face the
'

prospect of hunger at the end of the month, home-
i

lessness, sending children to school in ragged cloth-

ing, or inadequate medical care.

213. (3) National eligibility standards and a national

minimum benefit level for public assistance programs should

be established. Currently welfare eligibility and benefits

vary greatly among states. In 1985 a family of three

with no earnings had a maximum AFDC benefit of
$96 a month in Mississippi and $558 a month in Ver-

mont.*® To remedy these great disparities, which are

far larger than the regional differences in the cost of

living, and to assure a floor of benefits for all needy

people, our nation should establish and fund national

minimum benefit levels and eligibility standards in

cash assistance programs.*’ The benefits should also
]

be indexed to reflect changes in the cost of living. I

These changes reflect standards that our nation has '

already put in place for aged and disabled people and

veterans. Is it not possible to do the same for the

children and their mothers who receive public assis-
]

tance?
\

214. (4) Welfare programs should be available to two-

.

parent as well as single-parent families. Most states now

limit participation in AFDC to families headed by sin-
gle parents, usually women. The coverage of this

program should be extended to two-parent families i

so that fathers who are unemployed or poorly paid ;

do not have to leave home in order for their children 1

“ Ibid., 347-348.
,

In 1982, similar recommendations were made by eight former

Secretaries of Health, Education, and Welfare (now Health and
j

Human Services). In a report called '"Welfare Policy in the United

States," they suggested a number of ways in which national min-j

imal standards might be set and strongly urged the establishment

of a floor for all states and territories.

^ Committee on Ways and Means, Background Materials and Data

on Programs.

104



to receive help. Such a change would be a significant

step toward strengthening two-parent families who

are poor.

4. Conclusion

215. The search for a more human and effective

way to deal with poverty should not be limited to

short-term reform measures. The agenda for public

debate should also include serious discussion of more

fundamental alternatives to the existing welfare sys-

tem. We urge that proposals for a farnily aUowance
or a children's allowance be carefully examined as a

possible vehicle for ensuring a floor of income support

for all children and their families.^ Special attention

is needed to develop new efforts that are targeted on

long-term poverty, which has proven to be least re-

sponsive to traditional social welfare programs. The

"negative income tax" is another major policy pro-

posal that deserves continued discussion.^ These and

other proposals should be part of a creative and on-

going effort to fashion a system of income support

for the poor that protects their basic dignity and pro-

vides the necessary assistance in a just and effective

manner.

^ France adopted a "family" or "children's" allowance in 1932,

followed by Italy in 1936, The Netherlands in 1939, the United

Kingdom in 1945, and Sweden in 1947. Arnold Heidenheimer,

Hu^ Heclo, and Carolyn Teich Adams, Comparative Public Policy:
The Politics of Social Choice in Europe and America (New York: St.

Martin's Press, 1975), 189, 199. See Also Robert Kuttner, The Eco-

nomic Illusion (Boston: Houghton Mifflin Co., 1984), 243-246; and

Joseph Piccione, Help for Families on the Front Lines: The Theory and

Practice of Family Allowances (Washington, D.C.: The Free Congress

Research and Education Foundation, 1983).

^ Milton Friedman, Capitalism and Freedom (University of Chi-

cago Press, 1962), 190-195.

105



C. Food and Agriculture

216. The fundamental test of an economy is its

ability to meet the essential human needs of this gen-

eration and future generations in an equitable fashion.

Food, water, and energy are essential to life; their

abundance in the United States has tended to make

us complacent. But these goods—the foundation of
God's gift of life—are too crucial to be taken for granted.
God reminded the people of Israel that "the land is

mine; for you are strangers and guests with me" (Lv

25:23, RSV). Our Christian faith calls us to contem-

plate God's creative and sustaining action and to mea-

sure our own collaboration with the Creator in using

the earth's resources to meet human needs. While

Catholic social teaching on the care of the environment

and the management of natural resources is still in

the process of development, a Christian moral per-

spective clearly gives weight and urgency to their use

in meeting human needs.

217. No aspect of this concern is more pressing

than the nation's food system. We are concerned that
this food system may be in jeopardy as increasing

numbers of farm bankruptcies and foreclosures result

in increased concentration of land ownership.^ We
are likewise concerned about the increasing damage

to natural resources resulting from many modem ag-
ricultural practices: the overconsumption of water, the

depletion of topsoil, and the pollution of land and

water. Finally, we are concerned about the stark real-

ity of world hunger in spite of food surpluses. Our

food production system is clearly in need of evaluation

and reform.

^ The Current Financial Condition of Farmers and Farm Lenders, Ag.

Info. Bulletin no. 490 (Washington, D.C.: U.S. Department of Ag-
|

riculture Economic Research Service, March 1985), viii-x.

106



1. U.S. Agriculture—Past and Present
218. The current crisis has to be assessed in the

context of the vast diversity of U.S. crops and climates.

For example, subsistence farming in Appalachia, where

so much of the land is absentee-owned and where

coal mining and timber production are the major eco-

nomic interests, has little in common with family farm

grain production in the central Midwest or ranching

in the Great Plains. Likewise, large-scale irrigated fruit,

vegetable, and cotton production in the central valley

of California is very different from dairy farming in

Wisconsin or tobacco and peanut production in the

Southeast.

219. Two aspects of the complex history of U.S.

land and food policy are particularly relevant. First,

the United States entered this century with the own-

ership of productive land widely distributed. The

Preemption Acts of the earlv 19th century and the

Homesteaa Act ot 1862 were an important part of that

history. Wide distribution of ownership was reflected

in the number and decentralization of farms in the

United States, a trend that reached its peak in the

1930s. The U.S. farm system included nearly 7 million

owner-operators in 1935.^“ By 1983 the number of U.S.

farms had declined to 2.4 million, and only about 3

percent of the population were engaged in producing

food.^ Second, U.S. food policy has had a parallel

goal of keeping the consumer cost of food low. As a

result, Americans today spend less of their disposable

income on food than people in any other industrial-

ized country.^*

Data on farms and farm population are drawn from Agricul-

tural Statistics, annual reports of the U.S. Department of Agricul-

ture, Washington, D.C.

” Irma T. Elo and Calvin L. Beale, Rural Development. Poverty,

and Natural Resources (Washington, D.C.: National Center for Food

and Agricultural Policy, Resources for the Future, 1985).

National Food Review, USDA, no. 29 (Winter/Spring 1985). In

107



220. These outcomes require scrutiny. First of all,

the loss of farms and the exodus of farmers from the

land have led to the loss of a valued way of life, the

decline of many rural communities, and the increased

concentration of land ownership. Secondly, while low

food prices benefit consumers who are left with ad-

ditional income to spend on other goods, these pricing

policies put pressure on farmers to increase output

and hold down costs. This has led them to replace

human labor with cheaper energy, expand farm size

to employ new technologies favoring larger scale op-

erations, neglect soil and water conservation, under-

pay farmworkers, and oppose farmworker

unionization.^

221. Today nearly half of U.S. food production

comes from the 4 percent of farms with over $200,000

in gross sales.^ Many of these largest farms are no

longer operated by families, but by managers hired

by owners.^ Nearly three-quarters of all farms, ac-

counting for only 13 percent of total farm sales, are

comparatively small. They are often run by part-time

farmers who derive most of their income from off-

farm employment. The remaining 39 percent of sales

comes from the 24 percent of farms grossing between

$40,000 and $200,000. It is this group of farmers, lo-

cated throughout the country and caught up in the

1984 Americans were spending 15.1% of their disposable income

on food. This is an average figure. Many low-income people spent

a good deal more and others much less.
^ Luther Tweeten, Causes and Consequences of Structural Change

in the Farming Industry (Washington, D.C.: National Planning As-

sociation, 1984), 7.

^ Economic Indicators of the Farm Sector: Income and Balance Sheet

Statistics, 1983, ECIFS 3-3 (Washington, D.C.: U.S. Department of

Agriculture Economic Research Service, September 1984).

^ Marion Clawson, Ownership Patterns of Natural Resources in

America: Implications for Distribution of Wealth and Income (Washing-

ton, D.C.: Resources for the Future, Summer 1983).

108



long-term trend toward fewer and larger farms, who

are at the center of the present farm crisis.

222. During the 1970s new markets for farm ex-

ports created additional opportunities for profit and

accelerated the industrialization of agriculture, a pro-

cess already stimulated by new p>etroleum-based, large-

scale technologies that allowed farmers to cultivate

many more acres. Federal tax policies and farm pro-

grams fostered this tendency by encouraging too much

capital investment in agriculture and overemphasiz-

ing large-scale technologies.** The results were greater

production, increases in the value of farmland, and

heavy borrowing to finance expansion. In the 1980s,

with export markets shrinking and commodity prices

and land values declining, many farmers cannot repay

their loans.

223. Their situation has been aggravated by certain

"external" factors: persistent high interest rates that

make it difficult to repay or refinance loans, the heavy

debt burden of food-deficient countries, the high value

of the dollar, dramatically higher U.S. budget and

trade deficits, and generally reduced international trade

following the worldwide recession of the early 1980s.

The United States is unlikely to recapture its former

share of the world food and fiber trade, and it is not

necessarily an appropriate goal to attempt to do so.

Exports are not the solution to U.S. farm problems.

Past emphasis on producing for overseas markets has

contributed to the strain on our natural resource base

and has also undermined the efforts of many less

developed countries in attaining self-reliance in feed-

ing their own people. In attempting to correct these

abuses, however, we must not reduce our capability

to help meet emergency food needs.

“ Causes and Consequences, 7; and A Time to Choose: Summary

Rqx)rt on the Structure of Agriculture (Washington, D.C.: U.S. De-

partment of Agriculture, January 1981).

109



224. Some farmers face financial insolvency be-

cause of their own eagerness to take advantage of

what appeared to be favorable investment opportun-

ities. This was partly in response to the encourage-

ment of public policy incentives and the advice of

economists and financiers. Nevertheless, farmers

should share some responsibility for their current

plight.

225. Four other aspects of the current situation con-

cern us: first, land ownership is becoming further

concentrated as units now facing bankruptcy are added

to existing farms and nonfarm corporations. Diversity

of ownership and widespread participation are de-

clining in this sector of the economy as they have in

others. Since differing scales of operation and the in-

vestment of family labor have been important for

American farm productivity, this increasing concen-

tration of ownership in almost all sectors of agriculture

points to an important change in that system.** Of

particular concern is the growing phenomenon of

"vertical integration" whereby companies gain control

of two or three of the links in the food chain: as sup-

pliers of farm inputs, landowners, and food proces-

sors. This increased concentration could also adversely

affect food prices.

226. Second, diversity and richness in American
^

society are lost as farm people leave the land and rural
'

communities decay. It is not just a question of coping
!

with additional unemployment and a need for re-

training and relocation. It is also a matter of main-

taining opportunities for employment and human

The nature of this transformation and its implications have

been addressed previously by the USCC Committee on Social De-

velopment and World Peace in a February 1979 statement The Family

Farm and again in May 1980 by the bishops of the Midwest in a

joint pastoral letter Strangers and Guests: Toward Community in the

Heartland.

110



development in a variety of economic sectors and cul-

tural contexts.

227. Third, although the United States has set a

world standard for food production, it has not done

so without cost to our natural resource base.®^ On
nearly one-quarter of our most productive cropland,

topsoil erosion currently exceeds the rate at which it

can be replaced by natural processes. Similarly, un-

derground water supplies are being depleted in areas

where food production depends on irrigation. Fur-

thermore, chemical fertilizers, pesticides, and herbi-

cides, considered now almost essential to today's

agriculture, pollute the air, water, and soil, and pose

countless health hazards. Finally, where the expan-

sion of residential, industrial, and recreational areas

makes it rewarding to do so, vast acreages of prime

farmland, three million acres per year by some esti-

mates, are converted to nonfarm use. The contin-

uation of these practices, reflecting short-term

investment interests or immediate income needs of

farmers and other landowners, constitutes a danger

to future food production because these practices are

not sustainable.

228. Farm owners and farmworkers are the im-

I

mediate stewards of the natural resources required to

produce the food that is necessary to sustain life. These

resources must be understood as gifts of a generous

God. When they are seen in that light and when the
human race is perceived as a single moral community,

we gain a sense of the substantial responsibility we
bear as a nation for the world food system. Meeting

® Soil Conservation in America: What Do We Have To Lose? (Wash-
ington, D.C.: American Farmland Trust, 1984); E. Philip LeVeen,

"Domestic Food Security and Increasing Competition for Water,"

in Lawrence Busch and William B. Lacy, eds.. Food Security in the

United States (Boulder, Colo.: Westview Press, 1984), 52. See also

America's Soil and Water: Condition and Trends (Washington, D.C.:

U.S. Department of Agriculture Soil Conservation Service, 1981).

Ill



human needs today and in the future demands an

increased sense of stewardship and conservation from

owners, managers, and regulators of all resources,

especially those required for the production of food.

229. Fourth, the situation of racial minorities in the

U.S. food system is a matter of special pastoral con-

cern. They are largely excluded from significant par-

ticipation in the farm economy. Despite the agrarian

heritage of so many Hispanics, for example, they op-

erate only a minute fraction of America's farms.® Blade-

owned farms, at one time a significant resource for

black partidpation in the economy, have been dis-

appearing at a dramatic rate in recent years,

a

trend

that the U.S. Commission on Civil Rights has warned

"can only serve to further diminish the stake of blacks

in the social order and reinforce their skeptidsm re-

garding the concept of equality under the law."®

230. It is largely as hired farm laborers rather than

farm owners that minorities partidpate in the farm

economy. Along with many white farmworkers, they

are, by and large, the poorest paid and least benefited

of any laboring group in the country. Moreover, they

are not as well protected by law and public policy as

other groups of workers; and their efforts to organize

and bargain collectively have been systematically and

vehemently resisted, usually by farmers themselves.

Migratory field workers are particularly susceptible to

exploitation. This is reflected not only in their char-

acteristically low wages but also in the low standards

of housing, health care, and education made available

to these workers and their families.®

“ 1982 Census of Agriculture.
** U.S. Commission on Civil Rights, The Decline of Black Farming

in America (Washington, D.C.: U.S. Commission on Civil Rights,

February 1982), esp. 65-69 regarding their property.

“ Ibid., 8.

“ U.S. Department of Labor, Hearings Concerning Proposed Full

Sanitation Standards, document no. H-308 (Washington, D.C., 1984).

112



2. Guidelines for Action

231. We are convinced that current trends in the
food sector are not in the best interests of the United

States or of the global community. The decline in the

number of moderate-sized farms, increased concen-

tration of land ownership, and the mounting evidence

of poor resource conservation raise serious questions

of morality and public policy. As pastors, we cannot

remain silent while thousands of farm families caught

in the present crisis lose their homes, their land, and

their way of life. We approach this situation, however,
aware that it reflects longer-term conditions that carry

consequences for the food system as a whole and for

the resources essential for food production.

232. While much of the change needed must come

from the cooperative efforts of farmers themselves,

we strongly believe that there is an important role for

public policy in the protection of dispersed ownership

through family farms, as well as in the preservation

of natural resources. We suggest three guidelines for
both public policy and private efforts aimed at shaping

the future of American agriculture.

233. First, moderate-sized farms operated by families on

a full-time basis should be preserved and their economic

viability protected. Similarly, small farms and part-time

farming, particularly in areas close to cities, should

be encouraged. As we have noted elsewhere in this

pastoral letter,®^ there is genuine social and economic

value in maintaining a wide distribution in the own-

ership of productive property. The democratization

of decision making and control of the land resulting

from wide distribution of farm ownership are protec-

tions against concentration of power and a consequent

possible loss of responsiveness to public need in this

Ch. II, para. 112.

113



crucial sector of the economy.** Moreover, when those

who work in an enterprise also share in its ownership,

their active commitment to the purpose of the en-

deavor and their participation in it are enhanced.

Ownership provides incentives for diligence and is a

source of an increased sense that the work being done

is one's own. This is particularly significant in a sector

as vital to human well-being as agriculture.

234. Furthermore, diversity in farm ownership

tends to prevent excessive consumer dependence on

business decisions that seek maximum return on in-

vested capital, thereby making the food system overly

susceptible to fluctuations in the capital markets. This

is particularly relevant in the case of nonfarm cor-

porations that enter agriculture in search of high prof-

its. If the return drops substantially, or if it appears

that better profits can be obtained by investing else-

where, the corporation may cut back or even close

down operations without regard to the impact on the

community or on the food system in general. In similar

circumstances full-time farmers, with a heavy per-

sonal investment in their farms and strong ties to the

community, are likely to persevere in the hope of

better times. Family farms also make significant eco-

nomic and social contributions to the life of rural com-

munities.*’ They support farm suppliers and other

local merchants, and their farms support the tax base

needed to pay for roads, schools, and other vital ser-

vices.

235. This rural interdependence has value beyond

the rural community itself. Both Catholic social teach-

ing and the traditions of our country have emphasized

the importance of maintaining the rich plurality of

social institutions that enhances personal freedom and

“ A Time to Choose, 148.
^
Luther Tweeten, 'The Economics of Small Farms/ Science vol.

219 (March 4, 1983): 1041.

114



increases the opportunity for participation in com-

munity life. Movement toward a smaUer number of

very large farms employing wage workers would be

a movement away from this institutional pluralism.

By contributing to the vitality of rural communities,

full-time residential farmers enrich the social and po-

litical life of the nation as a whole. Cities, too, benefit

soundly and economically from a vibrant rural econ-

omy based on family farms. Because of out-migration

of farm and rural people, too much of this enriching

diversity has been lost already.

236. Second, the opportunity to engage in farming should

be protected as a valuable form of work. At a time when

unemployment in the country is already too high, any

unnecessary increase in the number of unemployed

people, however small, should be avoided. Farm un-

employment leads to further rural unemployment as

rural businesses lose their customers and close down.

The loss of people from the land also entails the loss

of expertise in farm and land management and creates

a need for retraining and relocating another group of

displaced workers.

237. Losing any job is painful, but losing one's farm

and having to leave the land can be tragic. It often

means the sacrifice of a famUy heritage and a way of

life. Once farmers sell their land and their equipment,

their move is practically irreversible. The costs of re-

turning are so great that few who leave ever come

back. Even the small current influx of people into

agriculture attracted by lower land values will not

b^ance this loss. Society should help those who would

and could continue effectively in farming.

238. Third, effective stewardship of our natural re-

sources should be a central consideration in any measures

regarding U.S. agriculture. Such stewardship is a con-

tribution to the common good that is difficult to assess
in purely economic terms, because it involves the care

of resources entrusted to us by our Creator for the

115



benefit of all. Responsibility for the stewardship of

these resources rests on society as a whole. Since

farmers make their living from the use of this endow-

ment, however, they bear a particular obligation to

be caring stewards of soil and water. They fulfill this

obligation by participating in soil and water conser-

vation programs, using farm practices that enhance

the quality of the resources, and maintaining prime

farmland in food production rather than letting it be

converted to nonfarm uses.

3. Policies and Actions

239. The human suffering involved in the present

situation and the long-term structural changes occur-

ring in this sector call for responsible action by the

whole society. A half-century of federal farm-price
supports, subsidized credit, production-oriented re-

search and extension services, and special tax policies

for farmers have made the federal government a cen-

tral factor in almost every aspect of American agri-

culture.’® No redirection of current trends can occur

without giving close attention to these programs.

240. A prime consideration in all agricultural trade
and food assistance policies should be the contribution

our nation can make to global food security. This means

continuing and increasing food aid without depress-

ing Third World markets or using food as a weapon

in international politics. It also means not subsidizing

exports in ways that lead to trade wars and instability

in international food markets.

241. We offer the following suggestions for gov-
ernmental action with regard to the farm and food

sector of the economy.

** U.S. Department of Agriculture, History of Agricultural Price-

Support and Adjustment Programs, 1933-1984, Ag. Info. Bulletin no.

485 (Washington, D.C.: U.S. Department of Agriculture Economic

Research Service, December 19M).

116



242. a. The current crisis calls for special measures

to assist otherwise viable family farms that are threat-

ened with bankruptcy or foreclosure. Operators of

such farms should have access to emergency credit,

reduced rates of interest, and programs of debt re-

structuring. Rural lending institutions facing prob-

lems because of nonpayment or slow payment of large

farm loans should also have access to temporary as-

sistance. Farmers, their families, and their commu-

nities will gain immediately from these and other short-

term measures aimed at keeping these people on the

land.

243. b. Established federal farm programs, whose

benefits now go disproportionately to the largest

farmers,” should be reassessed for their long-term

effects on the structure of agriculture. Income-support

programs that help farmers according to the amount

of food they produce or the number of acres they farm

should be subject to limits that ensure a fair income

to all farm fartulies and should restrict participation

to producers who genuinely need such income assis-

tance. There should also be a strict ceiling on price-

support payments which assist farmers in times of

falling prices, so that benefits go to farms of moderate

or small size. To succeed in redirecting the benefits

of these programs while holding down costs to the

public, consideration should be given to a broader

application of mandatory production control pro-

grams.”

244. c. We favor reform of tax policies which now
encourage the growth of large farms, attract invest-

” The Distribution of Benefits from the 1982 Federal Crop Programs

(Washington, D.C.; U.S. Senate Committee on the Budget, No-

vember 1984).
® "The Great Debate on Mandatory Production Controls" in

Farm Policy Perspectives: Setting the Stage for 1985 Agricultural Legis-

lation (Washington, D.C.: U.S. Senate Committee on Agriculture,

Nutrition, and Forestry, April 1984).

117



merits into agriculture by nonfarmers seeking tax shel-

ters, and inequitably benefit large and well-financed

farming operations.” Offsetting nonfarm income with

farm "losses" has encouraged high-income investors

to acquire farm assets with no intention of depending

on them for a living as family farmers must. The abUity

to depreciate capital equipment faster than its actual

decline in value has benefited wealthy investors and

farmers. Lower tax rates on capital gains have shm-

ulated farm expansion and larger investments in en-

ergy-intensive equipment and technologies as

substitutes for labor. Changes in estate tax laws have

consistently favored the largest estates. AH of these

results have demonstrated that reassessment of these

and similar tax provisions is needed.’^ We conhnue,
moreover, to support a pro^essive land tax on farm

acreage to discourage the accumulation of excessively

large holdings.”

245. d. Although it is often assumed that farms

must grow in size in order to make the most efficient

and productive use of sophisticated and costly tech-

nologies, numerous studies have shown that me-

dium-sized coirmerdal farms achieve most of the

technical cost efficiencies available in agriculture to-

day. We, therefore, recommend that the research and

extension resources of the federal government and

the nation's land grant colleges and universities be

redirected toward improving the productivity of small

and medium-sized farms.”

A Time to Choose, 91.

Richard Dunford, The Effects of Federal Income Tax Policy on U.S.

Agriculture (Washington, D.C.: Subcommittee on Agriculture and

Transportation of the Joint Economic Committee of the Congress

of the United States, December 21, 1984).

This proposal was put forward thirteen years ago in Where

Shall the People Live? A Special Message of the United States Catholic

Bishops (Washington, D.C.: USCC Office of Publishing and Pro-

motion Services, 1972).

"^Thomas E. Miller, et al.. Economies of Size in U.S. Field Crop

118



246. e. Since soil and water conservation, like other

efforts to protect the environment, are contributions

to the good of the whole society, it is appropriate for

the public to bear a share of the cost of these practices

and to set standards for environmental protection.

Government should, therefore, encourage farmers to

adopt more conserving practices and distribute the

costs of this conservation more broadly.

247. f
.
Justice demands that worker guarantees and

protections such as minimum wages and benefits and

unemployment compensation be extended to hired

farmworkers on the same basis as all other workers.

There is also an urgent need for additional farmworker

housing, health care, and educational assistance.

4. Solidarity in the Farm Community

248.

While there is much that government can and

should do to change the direction of farm and food

policy in this country, that change in direction also

depends upon the cooperation and good will of farm-

ers. The incentives in our farm system to take risks,

to expand farm size, and to speculate in farmland

values are great. Hence, farmers and ranchers must

weigh these incentives against the values of family,

rural community, care of the soil, and a food system

responsive to long-term as well as short-term food

needs of the nation and the world. The ever present

temptation to individualism and greed must be count-

ered by a determined movement toward solidarity in

the farm community. Farmers should approach farm-

ing in a cooperative way, working with other farmers

in the purchase of supplies and equipment and in the

marketing of produce. It is not necessary for every

farmer to be in competition against every other farmer.

Farming (Washington, D.C.: U.S. Department of Agriculture Eco-

nomic Research Service, July 1981).

119



Such cooperation can be extended to the role fanners

play through their various general and community

organizations in shaping and implementing govern-

mental farm and food policies.’^ Likewise, it is possible

to seek out and adopt technologies that reduce costs

and enhance productivity without demanding in-

creases in farm size. New technologies are not forced
on farmers; they are chosen by farmers themselves.

249. Farmers also must end their opposition to

farmworker unionization efforts. Farmworkers have

a legitimate right to belong to unions of their choice '

and to bargain collectively for just wages and working

conditions. In pursuing that right they are protecting

the value of labor in agriculture, a protection that also

applies to farmers who devote their own labor to their

farm operations.

5. Conclusion

250. The U.S. food system is an integral part of the

larger economy of the nation and the world. As such t

this integral role necessitates the cooperation of rural
^

and urban interests in resolving the challenges and
;

problems facing agriculture. The very nature of ag-

1

ricultural enterprise and the family farm traditions of I

this country have kept it a highly competitive sector

with a widely dispersed ownership of the most fun-ij

damental input to production, the land. That com-i

petitive, diverse structure, proven to be a dependable I

source of nutritious and affordable food for this coun-

1

i

try and millions of people in other parts of the world,
j

is now threatened. The food necessary for life, the)

land and water resources needed to produce that food,

and the way of life of the people who make the land

productive are at risk. Catholic social and ethical tra-i

ditions attribute moral significance to each of these.

” See ch. IV.

120



Our response to the present situation should reflect

a sensitivity to that moral significance, a determina-

tion that the United States will play its appropriate

role in meeting global food needs, and a commitment

to bequeath to future generations an enhanced natural

environment and the same ready access to the ne-

cessities of life that most of us enjoy today. To farmers

and farm workers who are suffering because of the

farm crisis, we promise our solidarity, prayers, coun-

seling and the other spiritual resources of our Catholic

fctith.

D. The U.S. Econom and the
Developing Nations: Cfomplexity,

Challenge, and Choices

1. The Complexity of Economic Relations

in an Interdependent World

251. The global economy is made up of national

economies of industrialized countries of the North and

the developing countries of the South, together with

the network of economic relations that link them. It

constitutes the framework in which the solidarity we

seek on a national level finds its international expres-

sion. Traditional Catholic teaching on this global inter-

dependence emphasizes the dignity of the human

person, the unity of the human family, the universally

beneficial purpose of the goods of the earth, the need

to pursue the international common good, as well as
the good of each nation, and the imperative of dis-

tributive justice. The United States plays a leading

role in the international economic system, and we are

concerned that U.S. relations with all nations—Can-

121



ada, Europe, Japan, and our other trading partners,

as well as the socialist countries—reflect this teaching
and be marked by fairness and mutual respect.

252. Nevertheless, without in the least discounting

the importance of these linkages, our emphasis on

the preferential option for the poor moves us to focus

our attention mainly on U.S. relations with the Third

World. Unless conscious steps are taken toward pro-

tecting human dignity and fostering human solidarity

in these relationships, we can look forward to in-

creased conflict and inequity, threatening the fragile

economies of these relatively poor nations far more

than our own relatively strong one. Moreover, equity

requires, even as the fact of interdependence becomes

more apparent, that the quality of interdependence be

improved, in order to eliminate "the scandal of the

shocking inequality between the rich and the poor"’*

in a world divided ever more sharply between them.

253. Developing countries, moreover, often per-

ceive themselves more as dependent on the industrial-

ized countries, especially the United States, because

the international system itself, as well as the way the

United States acts in it, subordinates them. The prices

at which they must sell their commodity exports and

purchase their food and manufactured imports, the

rates of interest they must pay and the terms they

must meet to borrow money, the standards of eco-

nomic behavior of foreign investors, the amounts and

conditions of external aid, etc., are essenhally deter-

mined by the industrialized world. Moreover, their

traditional cultures are increasingly susceptible to the

aggressive cultural penetration of Northern (espe-

cially U.S.) advertising and media programing. The

developing countries are junior partners at best.

Instruction on Certain Aspects of the Theology of Liberation, 1:6.

See also Peace on Earth, 130-131; and On Human Work, 11.

122



254. The basic tenets of church teaching take on a

new moral urgency as we deepen our understanding

of how disadvantaged large numbers of people and

nations are in this interdependent world. Half the

world's people, nearly two and a half billion, live in

countries where the annual per capita income is $400

or less.’’ At least 800 million people in those countries

live in absolute poverty, "beneath any rational defi-

nition of human decency. Nearly half a billion are

chronically hungry, despite abundant harvests world-

wide."" Fifteen out of every 100 children bom in those
countries die before the age of five, and millions of

the survivors are physically or mentally stunted. No

aggregate of individual examples could portray ade-

quately the appalling inequities within those desper-

ately poor countries and between them and our own.

And their misery is not the inevitable result of the

march of history or of the intrinsic nature of particular

cultures, but of human decisions and human insti-

tutions.

255. On the international economic scene three
main sets of actors warrant particular attention: in-

dividual nations, which retain great influence; mul-

tilateral institutions, which channel money, power,

ideas, and influence; transnational corporations and

banks, which have grown dramatically in number,

size, scope, and strength since World War II. In less

Overseas Development Council, U.S. Policy and the Third World:

Agenda 1985-1986.

Robert S. McNamara, Address to the Board of Governors of the

World Bank (Washington, D.C.: World Bank, September 30, 1980).

U.N./Food and Agricultural Organization, Dimensions ofNeed,

E 9 (Rome, 1982). The U.N. World Food Council uses this figure

consistently, most recently at its 11th annual meeting in Paris.

““ Joseph Greenwald and Kenneth Flamm, The Global Factory

(Washington, D.C.: The Brookings Institution, 1985); see also Ron-

ald Muller and Richard Barnet, Global Reach (New York: Simon and

Schuster, 1974); Raymond Vernon, The Economic and Political Con-

sequences of Multinational Enterprise (Cambridge, Mass.: Harvard

123



identifiable ways trade unions, popular movements,

private relief and development agencies, and regional

groupings of nations also affect the global economy.

The interplay among all of them sets the context for

policy choices that determine whether genuine inter-

dependence is promoted or the dependence of the

disadvantaged is deepened.

256. In this arena, where fact and ethical challenges

intersect, the moral task is to devise rules for the major

actors that will move them toward a just international

order. One of the most vexing problems is that of

reconciling the transnational corporations' profit ori-

entation with the common good that they, along with

governments and their multilateral agencies, are sup-

posed to serve.

257. The notion of interdependence erases the fad-

ing line between domestic and foreign policy. Many

foreign policy decisions (for example, on trade, in-

vestment, and immigration) have direct and substan-

tial impact on domestic constituencies in the United

States. Similarly, many decisions thought of as do-

mestic (for example, on farm policy, interest rates, the

federal budget, or the deficit) have important con-

sequences for other countries. This increasingly rec-

ognized link of domestic and foreign issues poses new

empirical and moral questions for national policy.

2. The Challenge of

Catholic Social Teaching

258. Catholic teaching on the international eco-

nomic order recognizes this complexity, but does not

provide specific solutions. Rather, we seek to ensure

that moral considerations are taken into account. All

of the elements of the moral perspective we have

University Press, 1972); the United Nations Center on Transnational

Corporations maintains current data on these institutions.

124



outlined above have important implications for inter-

national relationships. (1) The demands of Christian

love and human solidarity challenge all economic actors

to choose community over chaos. They require a def-

inition of political community that goes beyond na-

tional sovereignty to policies that recognize the moral

bonds among all people. (2) Basic justice implies that

all peoples are entitled to participate in the increas-

ingly interdependent global economy in a way that

ensures their freedom and dignity. When whole com-

munities are effectively left out or excluded from equi-

table participation in the international order, basic

justice is violated. We want a world that works fairly
for all. (3) Respect for human rights, both political and

economic, implies that international decisions, insti-

tutions, and policies must be shaped by values that

are more than economic. The creation of a global order

in which these rights are secure for all must be a prime

objective for all relevant actors on the international

stage. (4) The special place of the poor in this moral per-

spective means that meeting the basic needs of the

millions of deprived and hungry people in the world

must be the number one objective of international

policy.

259. These perspectives constitute a call for fun-

damental reform in the international economic order.

Whether the problem is preventing war and building

peace, or addressing the needs of the poor. Catholic

teaching emphasizes not only the individual con-

science, but also the political, legal, and economic

structures through which policy is determined and

issues are adjudicated. We do not seek here to eval-
uate the various proposals for international economic

reform or deal here with economic relations between

the United States and other industrialized countries.

We urge, as a basic and overriding consideration, that

Peace on Earth, 56-63 .

125



both empirical and moral evidence, especially the pre-

carious situation of the developing countries, calls for

the renewal of the dialogue between the industrialized

countries of the North and the developing countries

of the South, with the aim of reorganizing interna-

tional economic relations to establish greater equity

and help meet the basic human needs of the poor

majority.'®^

260. Here, as elsewhere, the preferential option for the

poor is the central priority for policy choice. It offers a

unique perspective on foreign policy in whose light

U.S. relationships, especially with developing coun-

tries, can be reassessed. Standard foreign policy anal-

ysis deals with calculations of power and definitions

of national interest; but the poor are, by definition,

not powerful. If we are to give appropriate weight to

their concerns, their needs, and their interests, we

have to go beyond economic gain or national security

as a starting point for the policy dialogue. We want
to stand with the poor everywhere, and we believe

that relations between the U.S. and developing na-

tions should be determined in the first place by a

concern for basic human needs and respect for cultural

traditions.

3. The Role of the United States in the

Global Economy: Constructive Choices

261. As we noted in The Challenge of Peace, recent

popes have strongly supported the United Nations as

a crucial step forward in the development and orga-

nization of the human community; we share their

regret that no political entity now exists with the re-

sponsibility and power to promote the global common

good, and we urge the United States to support UN

On the Development of Peoples, 44, 58-63; quoted also by Pope

John Paul II, Origins 14:16 (October 4, 1984): 247.

126



efforts to move in that direction. Building a just world

economic order in the absence of such an authority

demands that national governments promote public

policies that increase the ability of poor nations and

marginalized people to participate in the global econ-

omy. Because no other nation's economic power yet

matches ours, we believe that this responsibility per-

tains especially to the United States; but it must be

carried out in cooperation with other industrialized

countries as in the case of halting the rise of the dollar.

This is yet another evidence of the fact of interde-

pendence. Joint action toward these goals not only

promotes justice and reduces misery in the Third

World, but also is in the interest of the United States

and other industrialized nations.

262. Yet in recent years U.S. policy toward devel-

opment in the Third World has become increasingly

one of selective assistance based on an East-West as-

sessment of North-South problems, at the expense of

basic human needs and economic development. Such

a view makes national security the central policy prin-

ciple.^®^ Developing countries have become largely

testing grounds in the East-West struggle; they seem

to have meaning or value mainly in terms of this larger

geopolitical calculus. The result is that issues of hu-

man need and economic development take second

place to the political-strategic argument. This tenden-

cy must be resisted.

263. Moreover, U.S. performance in North-South

negotiations often casts us in the role of resisting de-

veloping-country proposals without advancing real-

istic ones of our own.*®^ North-South dialogue is bound

106
President's Commission on Security and Economic Assist-

ance (Carlucci Commission), A Report to the Secretary of State (Wash-

ington, D C., November 1983).
For example: After a dozen years of negotiations, during

which nearly all of the issues were resolved to U.S. satisfaction,

the United States refused to sign the Law of the Seas treaty; only

127



to be complex, protracted, and filled with symbolic

and often unrealistic demands; but the situation has

now reached the point where the rest of the world

expects the United States to assume a reluctant, ad-

versarial posture in such discussions. The U.S. ap-

proach to the developing countries needs urgently to

be changed; a country as large, rich, and powerful as

ours has a moral obligation to lead in helping to reduce

poverty in the Third World.

264. We believe that U.S. policy toward the de-
veloping world should reflect our traditional regard

for human rights and our concern for social progress.

In economic policy, as we noted in our pastoral letter

on nuclear war, the major international economic re-

lationships of aid, trade, finance, and investment are

interdependent among themselves and illustrate the

range of interdependence issues facing U.S. policy.

All three of the major economic actors are active in

all these relationships. Each relationship offers us the

possibility of substantial, positive movement toward

increasing social justice in the developing world; in

each, regrettably, we fall short. It is urgent that im-

mediate steps be taken to correct these deficiencies.

265. a. Development Assistance: The official devel-

opment assistance that the industrialized and the oil-

producing countries provide the Third World in the

form of grants; low-interest, long-term loans; com-

modities; and technical assistance is a significant con-

tribution to their development. Although the annual

share of U.S. gross national product (GNP) devoted

to foreign aid is now less than one-tenth of that of

the Marshall Plan, which helped rebuild devastated

but advanced European economies, we remain the

largest donor country. We still play a central role in

the United States failed to support the U.N. infant formula reso-

lution; the United States has not ratified the two UN Covenants
on Human Rights, etc.

128



these resource transfers, but we no longer set an ex-

ample for other donors. We lag proportionately be-
hind most other industrial nations in providing

resources and seem to care less than before about

development in the Third World. Our bilateral aid has

become increasingly militarized and security-related

and our contributions to multilateral agencies have

been reduced in recent years. Not all of these changes

are justifiable. The projects of the International De-

velopment Agency, for example, seem worthy of sup-

port.

266. This is a grave distortion of the priority that

development assistance should command. We are dis-
mayed that the United States, once the pioneer in

foreign aid, is almost last among the seventeen in-

dustrialized nations in the Organization for Economic

Cooperation and Development (OECD) in percentage

of GNP devoted to aid. Reduction of the U.S. con-
tribution to multilateral development institutions is

particularly regrettable, because these institutions are

often better able than the bilateral agencies to focus

on the poor and reduce dependency in developing

countries.'* This is also an area in which, in the past,

our leadership and example have had great influence.

A more affirmative U.S. role in these institutions,
which we took the lead in creating, could improve

their performance, send an encouraging signal of U.S.

intentions, and help reopen the dialogue on the grow-

ing poverty and dependency of the Third World.

U.S. Agency for International Development, Congressional

Presentation, Fiscal Year 1986, Main Volume (Washington, D.C., 1985).

The clients of the International Development Association, the

''soft loan window" of the World Bank, are the poorest countries.

The United States insisted upon—and obtained—a 25% reduction
in IDA'S current (seventh) replenishment. Taking inflation into

account, this meant a 40% drop in real terms at exactly the moment

when developing-country debt levels are punishingly high and the

prices of their export commodities are almost at rock bottom.

129



267. b. Trade: Trade continues to be a central com-

ponent of international economic relations. It con-

tributed in a major way to the rapid economic growth

of many developing countries in the 1960s and 1970s

and will probably continue to do so, though at a slower

rate. The preferential option for the poor does not,

by itself, yield a trade policy; but it does provide a

frame of reference. In particular, an equitable trading

system that will help the poor should allocate its ben-

efits fairly and ensure that exports from developing

countries receive fair prices reached by agreement

among all trading partners. Developing nations have

a right to receive a fair price for their raw materials

that allows for a reasonable degree of profit.

268. Trade policy illustrates the conflicting pres-

sures that interdependence can generate: claims of

injustice from developing countries denied market ac-

cess are countered by claims of injustice in the do-

mestic economies of industrialized countries when

jobs are threatened and incomes fall. Agricultural trade

and a few industrial sectors present particularly acute

examples of this.

269. We believe the ethical norms we have applied
to domestic economic questions are equally valid

here.'*” As in other economic matters, the basic ques-

tions are: Who benefits from the particular policy mea-
sure? How can any benefit or adverse impact be
equitably shared? We need to examine, for example,
the extent to which the success in the U.S. market of

certain imports is derived from exploitative labor con-

ditions in the exporting country, conditions that in

some cases have attracted the investment in the first

place. The United States should do all it can to ensure

that the trading system treats the poorest segments

of developing countries' societies fairly and does not

lead to human rights violations. In particular the United

See ch. II.

130



States should seek effective special measures under

the General Agreement on Tariffs and Trade (GATT)"®

to benefit the poorest countries.

270. At the same time, U.S. workers and their fam-

ilies hurt by the operation of the trading system must

be helped through training and other measures to

adjust to changes that advance development and de-

crease poverty in the Third World. This is a very se-

rious, immediate, and intensifying problem. In our

judgment, adjustment assistance programs in the

United States have been poorly designed and admin-

istered, and inadequately funded. A society and an
economy such as ours can better adjust to trade dis-

locations than can poverty-ridden developing coun-

tries.

271. c. Finance: Aid and trade policies alone, how-

ever enlightened, do not constitute a sufficient ap-

proach to the developing countries; they must also be

looked at in conjunction with international finance

and investment. The debtor-creditor relationship well

exemplifies both the interdependence of the inter-

national economic order and its asymmetrical char-

acter, i.e., the dependence of the developing countries.

The aggregate external debt of the developing coun-

tries now approaches $1 trillion,"' more than one-

third of their combined GNP; this total doubled be-

tween 1979 and 1984 and continues to rise. On av-
erage, the first 20 percent of export earnings goes to

service that debt without significantly reducing the

principal; in some countries debt service is nearly 100

The GATT, third of the Bretton Woods "institutions" (with

the World Bairk and the IMF) is in fact a treaty, monitored and

supported by a secretariat located in Geneva, Switzerland. Periodic

"rounds" of negotiations among its several score members. North

and South, modify and extend its provisions and regulations.

Debt figures have been compiled from data published by the

World Bank, the IMF, and the Bank for International Settlements.

131



percent of such earnings, leaving scant resources

available for the countries' development programs.

272. The roots of this very complex debt crisis are

both historic and systemic. Historically, the three major

economic actors share the responsibility for the pres-

ent difficulty because of decisions made and actions

taken during the 1970s and 1980s. In 1972 the Soviet

Union purchased the entire U.S. grain surplus, and

grain prices trebled. Betv^^een 1973 and 1979, the Or-

ganization of Petroleum Exporting Countries raised

the price of oil eightfold and thereafter deposited most

of the profits in commercial banks in the North. In

order to profit from the interest-rate spread on these

deposits, the banks pushed larger and larger loans on

eager Third World borrowers needing funds to pur-

chase more and more expensive oil. A second dou-
bling of oil prices in 1979 forced many of these countries

to refinance their loans and borrow more money at

escalating interest rates. A global recession beginning
in 1979 caused the prices of Third World export com-

modities to fall and thus reduced the ability to meet

the increasingly burdensome debt payments out of

export earnings.

273. The global system of finance, development, and

trade established by the Bretton Woods Conference

in 1944—the World Bank, the International Monetary
Fund (IMF), and theGATT—was created by the North
to prevent a recurrence of the economic problems that

were perceived to have led to World War II. Forty

years later that system seems incapable, without basic

changes, of helping the debtor countries—which had
no part in its creation—manage their increasingly un-
tenable debt situation effectively and equitably. The

World Bank, largest of these institutions, has been

engaged primarily in lending for specific projects rather

than for general economic health. The IMF was in-

tended to be a short-term lender that would help out

with temporary balance of payments, or cash-flow

132



problems; but in the current situation it has come to

the fore as a monitor of commercial financial trans-

actions and an evaluator of debtors' creditworthi-

ness—and therefore the key institution for resolving
these problems. The GATT, which is not an institu-

tion, had been largely supplanted, as trade monitor

for the developing countries, by UNCTAD"^ in which

the latter have more confidence.

274. This crisis, however, goes beyond the system;

it affects people. It afflicts and oppresses large num-

bers of people who are already severely disadvan-

taged. That is the scandal: it is the poorest people who

suffer most from the austerity measures required when

a country seeks the IMF "seal of approval" which

establishes its creditworthiness for a commercial loan

(or perhaps an external aid program). It is these same

people who suffer most when commodity prices faU,

when food carmot be imported or they cannot buy it,

and when natural disasters occur. Our commitment

to the preferential option for the poor does not permit

us to remain silent in these circumstances. Ways must

be found to meet the immediate emergency—mora-
torium on payments, conversion of some doUar-

denominated debt into local-currency debt, creditors'

accepting a share of the burden by partially writing-

down selected loans, capitalizing interest, or perhaps

outright cancellation.

The United Nations Conference on Trade and Development

(UNCTAD) originated in Geneva in 1964 at a meeting convened

by the U.N. to discuss trade, development, and related problems

of low-income countries. It established a quadrennial meeting and

created permanent machinery in the U.N. to deal with these prob-

lems. A Trade and Development Board (TDB), with standing com-
mittees, meets every two years; and there is a small secretariat to

staff it. UNCTAD is viewed as representing the developing coun-
tries' continuing effort to have a larger voice in international de-

cisions affecting trade and development and to secure more favorable

terms of trade.

133



275. The poorest countries, especially those in sub-

Saharan Africa which are least developed, most af-

flicted by hunger and malnutrition, and most vul-

nerable to commodity price declines, are in extremely

perilous circumstances."^ Although their aggregate

debt of more than $100 billion (much of it owed to

multilateral institutions), is about one-quarter that of

Latin America, their collateral (oil, minerals, manu-

factures, grain, etc.) is much less adequate, their abil-

ity to service external debt much weaker, and the

possibility of their rescheduling it very small. For low-

income countries like these, the most useful imme-

diate remedies are longer payment periods, lower in-

terest rates, and modification of IMF adjustment

requirements that exacerbate the already straitened

circumstances of the poor."'* Especially helpful for

some African countries would be cancellation of debts

owed to governments, a step already taken by some

creditor nations.

276. Better off debtor countries also need to be able

to adjust their debts without penalizing the poor. Al-

though the final policy decisions about the allocation

of adjustment costs belong to the debtor government,

internal equity considerations should be taken into

account in determining the conditions of debt re-

scheduling and additional lending; for example, wage

reductions should not be mandated, basic public ser-

vices to the poor should not be cut, and measures

should be required to reduce the flight of capital. Since

U.S. Policy and the Third World, Table B-5.
in When the IMF helps a country adjust to balance-of-payments 1

problems (e.g., by assisting in the rescheduling of its external debt),

it negotiates certain conditions with the debtor country in order to
j

improve its immediate financial position. In general, these require i

the borrowing country to earn and save more. The adjustments,
{

usually referred to as "conditionality," tend to fall most heavily on ‘

the poor through reduction of government spending on consumer
j

subsidies and public services, and often of wages. 1

134



this debt problem, like most others, is systemic, a case-

by-case approach is not sufficient: lending policies and

exchange-rate considerations are not only economic

questions, but are thoroughly and intensely political.

277. Beyond all this, the growing external debt that

has become the overarching economic problem of the

Third World also requires systemic change to provide

immediate relief and to prevent recurrence. The Bret-

ton Woods institutions do not adequately represent

Third World debtors, and their policies are not dealing

effectively with problems affecting those nations. These

institutions need to be substantially reformed and their

policies reviewed at the same time that the immediate

problem of Third World debt is being dealt with. The

United States should promote, support, and partici-

pate fully in such reforms and reviews. Such a role is

not only morally right, but is in the economic interest

of the United States; more than a third of this debt is

owed to U.S. banks. The viability of the international

banking system (and of those U.S. banks) depends in

part on the ability of debtor countries to manage those

debts. Stubborn insistence on full repayment could

force them to default—which would lead to economic
losses in the United States. In this connection, we

should not overlook the impact of U.S. budget and

trade deficits on interest rates. These high interest

rates exacerbate the already difficult debt situation.

They also attract capital away from investment in eco-

nomic development in Third World countries.

278. d. Foreign Private Investment: Although direct

private investment in the developing countries by U.S.-

based transnational corporations has declined in re-

cent years, it still amounts to about $60 billion and

accounts for sizeable annual transfers. Such invest-

ment in developing countries should be increased,

consistent with the host country's development goals

and with benefits equitably distributed. Particular ef-

forts should be made to encourage investments by

135



J

medium-sized and small companies, as well as to joint

ventures, which may be more appropriate to the de-

veloping country's situation. For the foreseeable
fu-

ture, however, private investment will probably
not

meet the infrastructural needs of the poorest coun-

tries—roads, transportation, communications, edu-

cation, health, etc.— since these do not generaUy show

profits and therefore do not attract private capital. Yet

without this infrastructure, no real economic growth

can take place.

279. Direct foreign investment, risky though it may

be for both the investing corporation and the
devel-

oping country, can provide needed capital, technol-

ogy, and managerial expertise. Care must be
taken

lest such investment create or perpetuate
depend-

ency, harming especially those at the bottom of
the

economic ladder. Investments that sustain or worsen

inequities in a developing country, that help to
main-

tain oppressive elites in power, or that increase
food

dependency by encouraging cash cropping for export

at the expense of local needs, should be
discouraged.

Foreign investors, attracted by low wage rates in less

developed countries, should consider both the
po-

tential loss of jobs in the home country and the po-

tential exploitation of workers in the host country."’

Both the products and the technologies of the
in-

vesting firms should be appropriate to the
developing

country, neither catering just to a small
number of

high-income consumers, nor establishing capital-

intensive processes that displace labor, especially
in

the agricultural sector."*

280. Such inequitable results, however, are not nec-

essary consequences of transnational corporate
activ-

"* North American Coalition for Human Rights in Korea, Tes-

timony before the U. S. Trade Representative. June 24,
1985.

E. F. Schumacher, Small Is Beautiful:
Economics As If People

Mattered (New York; Harper and Row, 1973).

136



ity. Corporations can contribute to development by

attracting and training high-caliber managers and other

personnel, by helping organize effective marketing

systems, by generating additional capital, by intro-

ducing or reinforcing financial accountability, and by

sharing the knowledge gained from their own re-

search and development activities. Although the abil-

ity of the corporations to plan, operate, and

communicate across national borders without concern

for domestic considerations makes it harder for gov-

ernments to direct their activities toward the common

good, the effort should be made; the Christian ethic

is incompatible with a primary or exclusive focus on

maximization of profit. We strongly urge U.S. and
international support of efforts to develop a code of

conduct for foreign corporations that recognizes their

quasi-public character and encourages both devel-

opment and the equitable distribution of their bene-

fits. Transnational corporations should be required to

adopt such a code, and to conform their behavior to

its provisions.

281. e. The World Food Problem—A Special Urgency:
These four resource transfer channels—aid, trade, fi-
nance, and investment—intersect and overlap in aU
economic areas, but in none more clearly than in the

international food system. The largest single segment

of development assistance support goes to the agri-

cultural sector and to food aid for short-term emer-

gencies and vulnerable groups; food constitutes one

of the most critical trade sectors; developing countries

have borrowed extensively in the international capital

markets to finance food imports; and a substantial

portion of direct private investment flows into the

agricultural sector.

282. The development of U.S. agriculture has moved

the United States into a dominant position in the in-

ternational food system. The best way to meet the

responsibilities this dominance entails is to design and

137



implement a U.S. food and agriculture policy that

contributes to increased food security—that is, access
by everyone to an adequate diet. A world with nearly
half a billion hungry people is not one in which food

security has been achieved. The problem of hunger

has a special significance for those who read the Scrip-

tures and profess the Christian faith. From the Lord's

command to feed the hungry, to the Eucharist we

celebrate as the Bread of Life, the fabric of our faith

demands that we be creatively engaged in sharing the

food that sustains life. There is no more basic human

need. The gospel imperative takes on new urgency

in a world of abundant harvests where hundreds of

millions of people face starvation. Relief and preven-

tion of their hunger cannot be left to the arithmetic

of the marketplace."^

283. The chronic hunger of those who live literaUy

from day to day is one symptom of the underlying

problem of poverty; relieving and preventing hunger

is part of a larger, coordinated strategy to attack pov-

erty itself. People must be enabled either to grow or

to buy the food they need, without depending on an

indefinite dole; there is no substitute for long-term

agricultural and food-system development in the na-

tions now caught in the grip of hunger and starvation.

Most authorities agree that the key to this develop-

ment is the small farmers, most of whom are pre-
vented from participating in the food system by the

lack of a market incentive resulHng from the poverty

of the bulk of the populations and by the lack of access

to productive agricultural inputs, especially land, re-

sulting mainly from their own poverty. In these poor,

food-deficit countries, no less than in our own, the

small family farm deserves support and protection.

284. But recognizing the long-term problem does

not dissolve the short-term obligation of the world's

On the Development of Peoples, 44, 58-63 .

138



major food-exporting nation to provide food aid suf-

ficient to meet the nutritional needs of poor people,

and to provide it not simply to dispose of surpluses

but in a way that does not discourage local food pro-

duction. There can be no successful solution to the

problem of hunger in the world without U.S. partic-

ipation in a cooperative effort that simultaneously in-

creases food aid and launches a long-term program

to help develop food self-reliance in food-deficit de-

veloping countries.

285. Hunger is often seen as being linked with the

problem of population growth, as effect to cause. While

this relationship is sometimes presented in oversim-

plified fashion, we cannot fail to recognize that the

earth's resources are finite and that population tends

to grow rapidly. Whether the world can provide a

truly human life for twice as many people or more as

now live in it (many of whose lives are sadly deficient

today) is a matter of urgent concern that cannot be

ignored."*

286. Although we do not believe that people are

poor and hungry primarily because they have large

families, the Church fully supports the need for all to

exercise responsible parenthood. Family size is heav-

ily dependent on levels of economic development,

education, respect for women, availability of health

care, and the cultural traditions of communities.

Therefore, in dealing with population growth we

strongly favor efforts to address these social and eco-

nomic concerns.

287. Population policies must be designed as part

of an overall strategy of integral human development.

They must respect the freedom of parents and avoid

coercion. As Pope Paul VI has said concerning pop-

ulation policies:

"* Ibid., 37; Pastoral Constitution, 87.

139



It is true that too frequently an accelerated

demographic increase adds its own difficulties to the

problems of development: the size of the population

increases more rapidly than available resources, and

things are found to have reached apparently an

impasse. From that moment the temptation is great

to check the demographic increase by means
of

radical measures. It is certain that public
authorities

can intervene, within the limit of their
competence,

by favoring the availability of appropriate information

and by adopting suitable measures, provided that

these be in conformity with the moral law and
that

they respect the rightful freedom of married
couples.

Where the inalienable right to marriage and

procreation is lacking, human dignity has ceased to

exist.

4. U.S. Responsibility for Reform in the

International Economic System

288. The United States cannot be the sole savior of

the developing world, nor are Third World countries

entirely innocent with respect to their own failures or

totally helpless to achieve their own destinies. Many

of these countries wiU need to initiate positive steps

to promote and sustain development and economic

growth—streamline bureaucracies, account for funds,
plan reasonable programs, and take further steps to-

ward empowering their people. Progress toward de-

velopment will surely require them to take some tough

remedial measures as well: prevent the flight of cap-

ital, reduce borrowing, modify price discrimination

against rural areas, eliminate corruption in
the use of

funds and other resources, and curtail spending on

inefficient public enterprises. The pervasive U.S. pres-

ence in many parts of our interdependent world, how-

ever, also creates a responsibility for us to
increase

On the Development of Peoples, 37 .



the use of U.S. economic power—not just aid—in the
service of human dignity and human rights, both po-

litical and economic.

289. In particular, as we noted in our earlier letter.

The Challenge of Peace, the contrast between expendi-

tures on armaments and on development reflects a

shift in priorities from meeting human needs to pro-

moting "national security" and represents a massive

distortion of resource allocations. In 1982, for exam-

ple, the military expenditures of the industrialized

countries were seventeen times larger than their for-

eign assistance; in 1985 the United States alone bud-

geted more than twenty times as much for defense

as for foreign assistance, and nearly two-thirds of the

latter took the form of military assistance (including

subsidized arms sales) or went to countries because

of their perceived strategic value to the United States.*^

Rather than promoting U.S. arms sales, especially to coun-

tries that cannot afford them, we should be campaigning for

an international agreement to reduce this lethal trade.

290. In short, the international economic order, like

many aspects of our own economy, is in crisis; the

gap between rich and poor countries and between

rich and poor people within countries is widening.

The United States represents the most powerful single

factor in the international economic equation. But even

as we speak of crisis, we see an opportunity for the

United States to launch a worldwide campaign for

justice and economic rights to match the still incom-

plete, but encouraging, political democracy we have

achieved in the United States with so much pain and

sacrifice.

291. To restructure the international order along

lines of greater equity and participation and apply the

preferential option for the poor to international eco-

Ruth Leger Sivard, World Military and Social Expenditures 1983

(Washington D.C.; World Priorities, 1983), 23.

141



nomic activity will require sacrifices of at least the

scope of those we have made over the years in build-

ing our own nation. We need to call again upon the
qualities of leadership and vision that have marked

our history when crucial choices were demanded. As

Pope John Paul II said during his 1979 visit to the

United States, "America, which in the past decades

has demonstrated goodness and generosity in pro-

viding food for the hungry of the world, wiU, I am

sure, be able to match this generosity with an equally

convincing contribution to the establishing of a world

order that will create the necessary economic and trade

conditions for a more just relationship between aU the

nations of the world.

292. We share his conviction that most of the policy
issues generally called economic are, at root, moral

and therefore require the application of moral prin-

ciples derived from the Scriptures and from the evolv-

ing social teaching of the Qiurch and other traditions.

We also recognize that we are dealing here with sen-
sitive international issues that cross national bound-

aries. Nevertheless, in order to pursue justice and

peace on a global scale, we call for a U.S. international

economic policy designed to empower people everywhere and

enable them to continue to develop a sense of their own

worth, improve the quality of their lives, and ensure that

the benefits of economic growth are shared equitably.

E. Conclusion

293. None of the issues we have addressed in this

chapter can be dealt with in isolation. They are

Pontifical Commission Justitia et Pax, The Social Teaching of

John Paul ll, 6 (October 6, 1979).

On the Development of Peoples, 44, 58-63.

142



interconnected, and their resolution requires difficult

trade-offs among competing interests and values. The

changing international economy, for example, greatly

influences efforts to achieve full employment in the

United States and to maintain a healthy farm sector.

Similarly, as we have noted, policies and programs

to reduce unemployment and poverty must not ignore

a potential inflationary impact. These complexities and

trade-offs are real and must be confronted, but they

are not an excuse for inaction. They should not par-

alyze us in our search for a more just economy.

294. Many of the reforms we have suggested in this

chapter would be expensive. At a time when the United

States has large annual deficits some might consider

these costs too high. But this discussion must be set

in the context of how our resources are allocated and

the immense human and social costs of failure to act

on these pressing problems. We believe that the ques-
tion of providing adequate revenues to meet the needs

of our nation must be faced squarely and realistically.

Reforms in the tax code which close loopholes and

generate new revenues, for example, are among the

steps that need to be examined in order to develop a

federal budget that is both fiscally sound and socially

responsible. The cost of meeting our social needs must

also be weighed against the $300 billion a year allo-

cated for military purposes. Although some of these

expenditures are necessary for the defense of the na-

tion, some elements of the military budget are both

wasteful and dangerous for world peace. Careful

reductions should be made in these areas in order to

See "Testimony on U. S. Arms Control Policy," Origins 14:10

(August 9, 1984): 154ff.

143



free up funds for social and economic reforms. In the

end, the question is not whether the United States

can provide the necessary funds to meet our social

needs, but whether we have the political will to do

so.

144



Chapter IV

A NEW AMERICAN
EXPERIMENT: PARTNERSHIP
FOR THE PUBLIC GOOD

295. For over two hundred years the United States

has been engaged in a bold experiment in democracy.

The founders of the nation set out to establish justice,

promote the general welfare, and secure the blessings

of liberty for themselves and their posterity. Those

who live in this land today are the beneficiaries of this

great venture. Our review of some of the most press-

ing problems in economic life today shows, however,

that this undertaking is not yet complete. Justice for

all remains an aspiration; a fair share in the general

welfare is denied to many. In addition to the particvilar

policy recommendations made above, a long-term and

more fundamental response is needed. This will call

for an imaginative vision of the future that can help

shape economic arrangements in creative new ways.

We now want to propose some elements of such a
vision and several innovations in economic structures

that can contribute to making this vision a reality.

296. Completing the unfinished business of the

American experiment will call for new forms of co-

operation and partnership among those whose daily

work is the source of the prosperity and justice of the

nation. The United States prides itself on both its

competitive sense of initiative and its spirit of team-

work. Today a greater spirit of partnership and team-

145



work is needed; competition alone wUl not do the job.

It has too many negative consequences for family life,

the economically vulnerable, and the environment.

Only a renewed commitment by all to the common

good can deal creatively with the realities of inter-

national interdependence and economic dislocations

in the domestic economy. The virtues of good citi-

zenship require a lively sense of participation in the

commonwealth and of having obligations as well as

rights within it.' The nation's economic health de-

pends on strengthening these virtues among all its

people, and on the development of institutional ar-

rangements supportive of these virtues.^

297. The nation's founders took daring steps to

create structures of participation, mutual accounta-

bility, and widely distributed power to ensure the

political rights and freedoms of all. We believe that
similar steps are needed today to expand economic

participation, broaden the sharing of economic power,

and make economic decisions more accountable to the

common good. As noted above, the principle of sub-

sidiarity states that the pursuit of economic justice

must occur on all levels of society. It makes demands

on communities as small as the family, as large as the

' Octogesima Adveniens, 24.

^ For different analyses along these Hnes with quite different

starting points see Martin Camoy, Derek Shearer, and Russell Rum-

berger, A New Social Contract (New York: Harper and Row, 1983);

Amatai Etzioni, An Immodest Agenda: Reconstructing America before

the Twenty-First Century (New York: McGraw-Hill, 1983); Charles

E. Lindblom, Politics and Markets (New York: Basic Books, 1977),

esp. 346-348; George C. Lodge, The New American Ideology (New

York: Alfred A. Knopf, 1975); Douglas Sturm, "Corporations, Con-

stitutions, and Covenants," Journal of the American Academy of Re-

ligion, 41 (1973): 331-55; Lester Thurow, The Zero-Sum Society (New

York: Basic Books, 1980), esp. ch. 1; Roberto Mangabeira Unger,

Knowledge and Politics (New York: Free Press, 1975); George F. Will,

Statecraft as Soulcraft: What Government Does (New York: Simon and

Schuster, 1982), esp. ch. 6.

146



global society and on all levels in between. There are

a number of ways to enhance the cooperative partic-

ipation of these many groups in the task of creating

this future. Since there is no single innovation that

will solve all problems, we recommend careful ex-

perimentation with several possibilities that hold con-

siderable hope for increasing partnership and

strengthening mutual responsibility for economic jus-

tice.

A. Cooperation within

Firms and Industries

298. Anew experiment in bringingdemocratic ideals

to economic life calls for serious exploration of ways

to develop new patterns of partnership among those

working in individual firms and industries.^ Every

business, from the smallest to the largest, including

farms and ranches, depends on many different per-

sons and groups for its success: workers, managers,

owners or shareholders, suppliers, customers, cred-

itors, the local community, and the wider society.

Each makes a contribution to the enterprise, and each

has a stake in its growth or decline. Present structures

of accountability, however, do not acknowledge all

these contributions or protect these stakes. A major
challenge in today's economy is the development of

new institutional mechanisms for accountability that

also preserve the flexibility needed to respond quickly

to a rapidly changing business environment.^

’ Pastoral Constitution, 68. See Mater et Magistra, 75-77.

* Charles W. Powers provided a helpful discussion of these

matters in a paper presented at a conference on the first draft of

this pastoral letter sponsored by the Harvard University Divinity

School and the Institute for Policy Studies, Cambridge, Massachu-

setts, March 29-31, 1985.

147



299. New forms of partnership between workers
and managers are one means for developing greater

participation and accountability within firms. * Recent

experience has shown that both labor and manage-

ment suffer when the adversarial relationship be-

tween them becomes extreme. As Pope Leo XIII stated,

"Each needs the other completely: capital cannot do

without labor, nor labor without capital."* The or-

ganization of firms should reflect and enhance this

mutual partnership. In particular, the development

of work patterns for men and women that are more
supportive of family life will benefit both employees

and the enterprises they work for.

300. Workers in firms and on farms are especially

in need of stronger institutional protection, for their

jobs and livelihood are particularly vulnerable to the

decisions of others in today's highly competitive labor

market. Several arrangements are gaining increasing

support in the United States: profit sharing by the

workers in a firm; enabling employees to become com-

pany stockholders; granting employees greater par-

ticipation in determining the conditions of work;

cooperative ownership of the firm by aU who work

within it; and programs for enabling a much larger

number of Americans, regardless of their employment

status, to become shareholders in successful corpo-

rations. Initiatives of this sort can enhance produc-

tivity, increase the profitability of firms, provide greater

* See John Paul II, "The Role of Business in a Changing Work-

place," 3, Origins 15 (February 6, 1986): 567.

‘ Rerum Novarum, 28. For an analysis of the relevant papal teach-

ings on institutions of collaboration and partnership, see John Cronin,

Catholic Social Principles: The Social Teaching of the Catholic Church

Applied to American Economic Life (Milwaukee: Bruce, 1950), ch. VII;

Oswald von Nell-Breuning, Reorganization of Social Economy: The

Social Encyclical Developed and Explained, trans. Bernard W. Dempsey

(Milwaukee: Bruce, 1936), chs. X-Xll; Jean-Yves Calvez and Jacques

Perrin, The Church and Social fustice, trans. J. R. Kirwan (Chicago:

Regnery, 1961), ch. XIX.

148



job security and work satisfaction for employees, and

reduce adversarial relations/ In our 1919 Program of

Social Reconstruction, we observed "the full possi-

bilities of increased production will not be realized so

long as the majority of workers remain mere wage

earners. The majority must somehow become owners,

at least in part, of the instruments of production."®

We believe this judgment remains generally valid to-
day.

301 . None of these approaches provides a panacea,

and all have certain drawbacks. Nevertheless we be-

lieve that continued research and experimentation with

these approaches will be of benefit. Catholic social

teaching has endorsed on many occasions innovative

methods for increasing worker participation within

firms.’ The appropriateness of these methods will de-

pend on the circumstances of the company or industry

in question and on their effectiveness in actually in-

creasing a genuinely cooperative approach to shaping

’’

Michael Conte, Arnold S. Tannenbaum, and Donna Mc-

Culloch, Employee Ownership, Research Report Series, Institute for

Social Research (Ann Arbor, Mich.: University of Michigan, 1981);

Robert A. Dahl, A Preface to Economic Democracy (Berkeley: Univer-

sity of California Press, 1985); Harvard Business School, "The Mon-

dragon Cooperative Movement," case study prepared by David P.

Ellerman (Cambridge, Mass.: Harvard Business School, n.d.); Rob-

ert jackall and Henry M. Levin, eds.. Worker Cooperatives in America

(Berkeley: University of California Press, 1984); Derek Jones and

Jan Svejnar, eds.. Participatory and Self-Managed Firms: Evaluating

Economic Performance (Lexington, Mass.: D. C. Heath, 1982); Irving

H. Siegel and Edgar Weinberg, Labor-Management Cooperation: The

American Experience (Kalamazoo, Mich.: W. E. Upjohn Institute for

Employment Research, 1982); Stuart M. Speiser, "Broadened Cap-

ital Ownership—The Solution to Major Domestic and International
Problems," Journal of Post Keynesian Economics VIII (1985): 426-434;

Jaroslav Vanek, ed., Self-Management: Economic Liberation of Man

(London: Penguin, 1975); Martin L. Weitzman, The Share Economy

(Cambridge, Mass.: Harvard University Press, 1984).

* Program of Social Reconstruction in Justice in the Marketplace, 381.

’ Mater et Magistra, 32, 77, 85-103; On Human Work, 14.

149



decisions. The most highly publicized examples of

such efforts have been in large firms facing serious

financial crises. If increased participation and collab-

oration can help a firm avoid collapse, why should it

not give added strength to healthy businesses? Co-

operative ownership is particularly worthy of consid-

eration in new entrepreneurial enterprises.'®

302. Partnerships between labor and management

are possible only when both groups possess real free-

dom and power to influence decisions. This means

that unions ought to continue to play an important

role in moving toward greater economic participation

within firms and industries. Workers rightly reject

calls for less adversarial relations when they are a

smokescreen for demands that labor make all the

concessions. For partnership to be genuine it must be

a two-way street, with creative initiative and a will-

ingness to cooperate on all sides.

303. When companies are considering plant clo-

sures or the movement of capital, it is patently unjust

to deny workers any role in shaping the outcome of

these difficult choices." In the heavy manufacturing

sector today, technological change and international

competition can be the occasion of painful decisions

leading to the loss of jobs or wage reductions. While

such decisions may sometimes be necessary, a col-

laborative and mutually accountable model of indus-

trial organization would mean that workers not be

expected to carry all the burdens of an economy in

transition. Management and investors must also ac-

For examples of worker-owned and operated enterprises sup-

ported by the Campaign for Human Development's revolving loan

fund see CHD's Annual Report (Washington, D.C.: USCC).

" Quadragesimo Anno states the basic norm on which this con-

clusion is based: "It is wholly false to ascribe to property alone or

to labor alone whatever has been obtained through the combined

effort of both, and it is wholly unjust for either, denying the efficacy

of the other, to arrogate to itself whatever has been produced" (53).

150



cept their share of sacrifices, especially when man-

agement is thinking of closing a plant or transferring

capital to a seemingly more lucrative or competitive

activity. The capital at the disposal of management is

in part the product of the labor of those who have

toiled in the company over the years, including cur-

rently employed workers.'^ As a minimum, workers

have a right to be informed in advance when such

decisions are under consideration, a right to negotiate

with management about possible alternatives, and a

right to fair compensation and assistance with retrain-

ing and relocation expenses should these be neces-

sary. Since even these minimal rights are jeopardized

without collective negotiation, industrial cooperation

requires a strong role for labor unions in our changing

economy.

304. Labor unions themselves are challenged by

the present economic environment to seek new ways

of doing business. The purpose of unions is not simply

to defend the existing wages and prerogatives of the

fraction of workers who belong to them, but also to

enable workers to make positive and creative contri-

butions to the firm, the community, and the larger

society in an organized and cooperative way.'^ Such

On Human Work, 12.

Ibid., 20. This point was well made by John Cronin twenty-

five years ago: '"Even if most injustice and exploitation were re-

moved, unions would still have a legitimate place. They are the

normal voice of labor, necessary to organize social life for the com-

mon good. There is positive need for such organization today, quite

independently of any social evils which may prevail. Order and

harmony do not happen; they are the fruit of conscious and or-

ganized effort. While we may hope that the abuses which occa-

sioned the rise of unions may disappear, it does not thereby follow

that unions will have lost their function. On the contrary, they will
be freed from unpleasant, even though temporarily necessary, tasks

and able to devote all their time and efforts to a better organization

of social life" Catholic Social Principles, 418. See also AFL-CIO Com-

mittee on the Evolution of Work, The Future of Work (Washington,

D.C.: AFL-CIO, 1983).

151



1

contributions call for experiments with new directions

in the U.S. labor movement.

305. The parts played by managers and sharehold-

ers in U.S. corporations also need careful examination.

In U.S. law, the primary responsibility of managers

is to exercise prudent business judgment in the in-

terest of a profitable return to investors. But morally

this legal responsibility may be exercised only within

the bounds of justice to employees, customers, sup-

pliers, and the local community. Corporate mergers

and hostile takeovers may bring greater benefits to

shareholders, but they often lead to decreased concern

for the well-being of local communities and make towns

and cities more vulnerable to decisions made from

afar.

306. Most shareholders today exercise relatively lit-

tle power in corporate governance. Although share-

holders can and should vote on the selection of

corporate directors and on investment questions and

other policy matters, it appears that return on in-

vestment is the governing criterion in the relation

between them and management. We do not believe

this is an adequate rationale for shareholder decisions.

The question of how to relate the rights and respon-

sibilities of shareholders to those of the other people

and communities affected by corporate decisions is

complex and insufficiently understood. We, there-

fore, urge serious, long-term research and experi-

mentation in this area. More effective ways of dealing

with these questions are essential to enable firms to

serve the common good.

“ For a classic discussion of the relative power of managers and

shareholders see A. A. Berle and Gardiner C. Means, The Modem

Corporation and Private Property (New York, Macmillan, 1932).

152



B. Local and Regional Cooperation

307. The context within which U.S. firms do busi-

ness has direct influence on their ability to contribute

to the common good. Companies and indeed whole
industries are not sole masters of their own fate. In-
creased cooperative efforts are needed to make local,

regional, national, and international conditions more

supportive of the pursuit of economic justice.

308. In the principle of subsidiarity. Catholic social

teaching has long stressed the importance of small-

and intermediate-sized communities or institutions in

exercising moral responsibility. These mediating

structures link the individual to society as a whole in

a way that gives people greater freedom and power
to act. Such groups include families, neighborhoods,

church congregations, community organizations, civic

and business associations, public interest and advo-

cacy groups, community development corporations,

and many other bodies. All these groups can play a
crucial role in generating creative partnerships for the

pursuit of the public good on the local and regional
level.

309. The value of partnership is illustrated by con-
sidering how new jobs are created. The development
of new businesses to serve the local community is key
to revitalizing areas hit hard by unemployment.'* The
cities and regions in greatest need of these new jobs
face serious obstacles in attracting enterprises that can

provide them. Lack of financial resources, limited en-

trepreneurial skill, blighted and unsafe environments,
and a deteriorating infrastructure create a vicious cycle

“ Peter L. Berger and Richard John Neuhaus, To Empower People:
The Role of Mediating Structures in Public Policy (Washington, D.C.:

American Enterprise Institute, 1977).
“ United States Small Business Administration, 1978 Annual Re-

port (Washington, D.C.: Government Printing Office, 1979).

153



that makes new investment in these areas more risky

and therefore less likely.

310. Breaking out of this cycle will require a co-

operative approach that draws on all the resources of

the community.'^ Community development corpo-

rations can keep efforts focused on assisting those

most in need. Existing business, labor, financial, and

academic institutions can provide expertise in part-

nership with innovative entrepreneurs. New coop-
erative structures of local ownership will give the

community or region an added stake in businesses

and even more importantly give these businesses a

greater stake in the community.'^ Government on the

local, state, and national levels must play a significant

role, especially through tax structures that encourage

investment in hard hit areas and through funding

aimed at conservation and basic infrastructure needs.

Initiatives like these can contribute to a multilevel

response to the needs of the community.

311. The Church itself can work as an effective

partner on the local and regional level. First-hand

knowledge of community needs and commitment to

the protection of the dignity of all should put Church

leaders in the forefront of efforts to encourage a com-

munity-wide cooperative strategy. Because churches

For recent discussion from a variety of perspectives see: Robert

Friedman and William Schweke, eds.. Expanding the Opportunity to

Produce: Revitalizing the American Economy through Neu> Enterprise

Development: A Policy Reader (Washington, D C.: Corporation for

New Enterprise Development, 1981); Jack A. Meyer, ed.. Meeting

Human Needs: Toward a Neu^ Public Philosophy (Washington, D.C.:

American Enterprise Institute, 1982); Committee for Economic De-

velopment, lobs for the Hard-to-Employ: Neu^ Directions for a Public-

Private Partnership (New York: Committee for Economic Develop)-

ment, 1978); Gar Alperovitz and Jeff Faux, Rebuilding America: A

Blueprint for the Neu^ Economy (New York: Pantheon Books, 1984).

Christopher Mackin, Strategies for Local Ownership and Control:

A Policy Analysis (Somerville, Mass.: Industrial Cooperative Asso-

ciation, 1983).

154



include members from many different parts of the

community, they can often serve as mediator between

groups who might otherwise regard each other with

suspicion. We urge local church groups to work cre-
atively and in partnership with other private and pub-

lic groups in responding to local and regional problems.

C. Partnership in the

Development of National Policies

312. The causes of our national economic problems

and their possible solutions are the subject of vigorous

debate today. The discussion often turns on the role

the national government has played in creating these

problems and could play in remedying them. We want
to point to several considerations that could help build

new forms of effective citizenship and cooperation in

shaping the economic life of our country.

313. First, while economic freedom and personal

initiative are deservedly esteemed in our society, we

have increasingly come to recognize the inescapably

social and political nature of the economy. The market

is always embedded in a specific social and political

context. The tax system affects consumption, saving,

and investment. National monetary policy, domestic

and defense programs, protection of the environment

and worker safety, and regulation of international trade

all shape the economy as a whole. These policies in-

fluence domestic investment, unemployment rates,

foreign exchange, and the health of the entire world

economy.

314. The principle of subsidiarity calls for govern-

ment intervention when small or intermediate groups

in society are unable or unwilling to take the steps

needed to promote basic justice. Pope John XXIII ob-

served that the growth of more complex relations of

155



interdependence among citizens has led to an in-

creased role for government in modem societies.”
This role is to work in partnership with the many other

groups in society, helping them fulfill their tasks and

responsibilities more effectively, not replacing or de-

stro)dng them. The challenge of today is to move be-

yond abstract disputes about whether more or less

government intervention is needed, to consideration

of creative ways of enabling government and private

groups to work together effectively.

315. It is in this light that we understand Pope John
Paul II's recommendation that "society make provi-

sion for overall planning" in the economic domain.^

Planning must occur on various levels, with the gov-

ernment ensuring that basic justice is protected and

also protecting the rights and freedoms of all other

agents. In the Pope's words:

In the final analysis this overall concern weighs on

the shoulders of the state, but it cannot mean one-

sided centralization by the public authorities. Instead

what is in question is a just and rational coordination

within the framework of which the initiative of in-

dividuals, free groups, and local work centers and

complexes must be safeguarded.^'

316. We are well aware that the mere mention of
economic planning is likely to produce a strong neg-

ative reaction in U.S. society. It conjures up images

of centralized planning boards, command economies,

inefficient bureaucracies, and mountains of govern-

ment paperwork. It is also clear that the meaning of

"planning" is open to a wide variety of interpretations

and takes very different forms in various nations.^

” Mater et Magistra, 59, 62.

“ Ort Human Work, 18.

Ibid.

“ For examples and analysis of different meanings of economic

planning see Naomi Caiden and Aaron Wildavsky, Planning ami

156



The Pope's words should not be construed as an en-

dorsement of a highly centralized form of economic

planning, much less a totalitarian one. His call for a

"just and rational coordination" of the endeavors of

the many economic actors is a call to seek creative

new partnership and forms of participation in shaping

national policies.

317. There are already many forms of economic

planning going on within the U.S. economy today.

Individuals and families plan for their economic fu-

ture. Management and labor unions regularly develop

both long- and short-term plans. Towns, cities, and

regions frequently have planning agencies concerned

with their social and economic future. When state

legislatures and the U.S. Congress vote on budgets

or on almost any other bill that comes before them,

they are engaged in a form of public planning. Cath-

olic social teaching does not propose a single model

for political and economic life by which these levels

are to be institutionally related to each other. It does

insist that reasonable coordination among the differ-

ent parts of the body politic is an essential condition

for achieving justice. This is a moral precondition of

good citizenship that applies to both individual and

institutional actors. In its absence no political structure

can guarantee justice in society or the economy. Ef-

fective decisions in these matters will demand greater

cooperation among all citizens. To encourage our fel-

low citizens to consider more carefully the appropriate

Budgeting in Poor Countries (New York: Wiley, 1974); Robert Dahl

and Charles E. Lindblom, Politics. Economics and Welfare: Planning

and Politico-Economic Systems Resolved into Basic Social Processes (Chi-

cago; University of Chicago Press, 1976); Stephen S. Cohen, Modem

Capitalist Planning: The French Model (Berkeley: University of Cali-

fornia Press, 197^; Albert Waterston, Development Planning: Lessons

of Experience (Baltimore: Johns Hopkins Press, 1965); Rebuilding

America, chs. 14, 15.

157



balance of private and local initiative with national

economic policy, we make several recommendations.

318. First, in an advanced industrial economy like ours,

all parts of society, including government, must cooperate

in forming national economic policies. Taxation, monetary

policy, high levels of government spending, and many

other forms of governmental regulation are here to

stay. A modem economy without governmental in-
terventions of the sort we have alluded to is incon-

ceivable. These interventions, however, should help,

not replace, the contributions of other economic actors

and institutions and should direct them to the com-

mon good. The development of effective new forms

of partnership between private and public agencies

will be difficult in a situation as immensely complex

as that of the United States in which various aspects

of national policy seem to contradict one another.^

On the theoretical level, achieving greater coordina-
tion will make demands on those with the technical

competence to analyze the relationship among dif-

ferent parts of the economy. More practically, it will

require the various subgroups within our society to

sharpen their concern for the common good and mod-

erate their efforts to protect their own short-term in-

terests.

319. Second, the impact of national economic policies on

the poor and the vulnerable is the primary criterion for

judging their moral value. Throughout this letter we

have stressed the special place of the poor and the

vulnerable in any ethical analysis of the U. S. econ-

omy. National economic policies that contribute to

“ For example, many students of recent policy point out that

monetary policy on the one hand and fiscal policies governing

taxation and government expenditures on the other have been at

odds with each other, with larger public deficits and high interest

rates as the outcome. See Alice M. Rivlin, ed.. Economic Choices

1984 (Washington, D.C.: The Brookings Institution, 1984), esp. ch.

2

158



building a true commonwealth should reflect this by

standing firmly for the rights of those who fall through

the cracks of our economy: the poor, the unemployed,

the homeless, the displaced. Being a citizen of this

land means sharing in the responsibility for shaping

and implementing such policies.

320. Third, the serious distortion of national economic

priorities produced by massive national spending on defense

must be remedied. Clear-sighted consideration of the

role of government shows that government and the

economy are already closely intertwined through mil-

itary research and defense contracts. Defense-related

industries make up a major part of the U.S. economy

and have inhmate links with both the military and

civilian government; they often depart from the com-

petitive model of free-market capitalism. Moreover,

the dedication of so much of the national budget to

military purposes has been disastrous for the poor

and vulnerable members of our own and other na-

tions. The nation's spending priorities need to be re-

vised in the interests of both justice and peace.

321. We recognize that these proposals do not pro-
vide a detailed agenda. We are also aware that there
is a tension between setting the goals for coherent

policies and actually arriving at them by democratic

means. But if we can increase the level of commitment

to the common good and the virtues of citizenship in

our nation, the ability to achieve these goals wdU greatly

increase. It is these fundamental moral concerns that

lead us as bishops to join the debate on national prior-

ities.

“ The Challenge of Peace, 270
-271 ,

159



D. Cooperation at the

International Level

322. If our country is to guide its international eco-

nomic relationships by policies that serve human dig-

nity and justice, we must expand our understanding

of the moral responsibility of citizens to serve the

common good of the entire planet. Cooperation is not

limited to the local, regional, or national level. Eco-

nomic policy can no longer be governed by national

goals alone. The fact that the "social question has

become worldwide"^ challenges us to broaden our

horizons and enhance our collaboration and sense of

solidarity on the global level. The cause of democracy

is closely tied to the cause of economic justice. The

unfinished business of the American experiment in-

cludes the formation of new international partner-

ships, especially with the developing countries, based

on mutual respect, cooperation, and a dedication to

fundamental justice.

323. The principle of subsidiarity calls for govern-

ment to intervene in the economy when basic justice

requires greater social coordination and regulation of

economic actors and institutions. In global economic

relations, however, no international institution pro-

vides this sort of coordination and regulation. The

U.N. system, including the World Bank, the Inter-

national Monetary Fund, and the General Agreement

on Tariffs and Trade, does not possess the requisite

authority. Pope John XXIII called this institutional

weakness a "structural defect" in the organization of

the human community. The structures of world order,

including economic ones, "no longer correspond to

“ On the Development of Peoples, 3 .

160



the objective requirements of the universal common

good."“’

324. Locked together in a world of limited material

resources and a growing array of common problems,

we help or hurt one another by the economic policies

we choose. All the economic agents in our society,

therefore, must consciously and deliberately attend

to the good of the whole human family. We must all
work to increase the effectiveness of international

agencies in addressing global problems that cannot

be handled through the actions of individual coun-

tries. In particular we repeat our plea made in The

Challenge of Peace urging "that the United States adopt

a stronger supportive leadership role with respect to

the United Nations. In the years following World

War 11, the United States took the lead in establishing

multilateral bodies to deal with postwar economic

problems. Unfortunately, in recent years this country

has taken steps that have weakened rather than

strengthened multilateral approaches. This is a short-

sighted policy and should be reversed if the long-term

interests of an interdependent globe are to be served.

“

In devising more effective arrangements for pursuing

international economic justice, the overriding prob-

lem is how to get from where we are to where we

ought to be. Progress toward that goal demands pos-

itive and often difficult action by corporations, banks,

labor unions, governments, and other major actors

on the international stage. But whatever the difficulty,

the need to give priority to alleviating poverty in de-

veloping countries is undeniable; and the cost of con-

tinued inaction can be counted in human lives lost or

stunted, talents wasted, opportunities foregone, mis-

ery and suffering prolonged, and injustice condoned.

“ Peace on Earth, 134-135.

® The Challenge of Peace, 268.
“ See Robert O. Keohane and Joseph S. Nye, Jr., "Two Cheers

for Multilateralism," Foreign Policy 60 (Fall 1985): 148-167.

161



325. Self-restraint and self-criticism by all
parties

are necessary first steps toward strengthening
the in-

ternational structures to protect the
common good.

Otherwise, growing interdependence will lead to
con-

flict and increased economic threats to human dignity.

This is an important long-term challenge to
the eco-

nomic future of this country and its place in the
emerg-

ing world economic community.

162



Chapter V

A COMMITMENT
TO THE FUTURE

326. Because Jesus' command to love our neighbor

is universal, we hold that the life of each person on

this globe is sacred. This commits us to bringing about

a just economic order where all, without exception,

will be treated with dignity and to working in collab-

oration with those who share this vision. The world

is complex and this may often tempt us to seek simple

and self-centered solutions; but as a community of

disciples we are called to a new hope and to a new

vision that we must live without fear and without

oversimplification. Not only must we learn more about

our moral responsibility for the larger economic issues

that touch the daily life of each and every person on

this planet, but we also want to help shape the Church

as a model of social and economic justice. Thus, this

chapter deals with the Christian vocation in the world

today, the special challenges to the Church at this

moment of history, ways in which the themes of this

letter should be followed up, and a call to the kind

of commitment that will be needed to reshape the

future.

163



A. The Christian Vocation in the

World Today

327. This letter has addressed many matters com-

monly regarded as secular, for example, employment

rates, income levels, and international economic re-

lationships. Yet, the affairs of the world, including

economic ones, cannot be separated from the spiritu^

hunger of the human heart. We have presented the
biblical vision of humanity and the Church's moral

and religious tradition as a framework for asking the

deeper questions about the meaning of economic life

and for actively responding to them. But words alone

are not enough. The Christian perspective on the

meaning of economic life must transform the lives of

individuals, families, in fact, our whole culture. The

Gospel confers on each Christian the vocation to love

God and neighbor in ways that bear fruit in the life

of society. That vocation consists above all in a change

of heart: a conversion expressed in praise of God and

in concrete deeds of justice and service.

1. Conversion

328. The transformation of social structures begins

with and is always accompanied by a conversion of

the heart.' As disciples of Christ each of us is called

to a deep personal conversion and to "action on behalf

of justice and participation in the transformation of

the world. By faith and baptism we are fashioned

into a "new creature"; we are filled with the Holy

Spirit and a new love that compels us to seek out a

new profound relationship with God, with the human

' Reconciliation and Penance, 13 .

^ Justice in the World, 6 .

164



family, and with all created things.^ Renouncing self-

centered desires, bearing one's daily cross, and imi-

tating Christ's compassion, all involve a personal

struggle to control greed and selfishness, a personal

commitment to reverence one's own human dignity

and the dignity of others by avoiding self-indulgence

and those attachments that make us insensitive to the

conditions of others and that erode social solidarity.

Christ warned us against attachments to material

things, against total self-reliance, against the idolatry

of accumulating material goods and seeking safety in

them. We must take these teachings seriously and in
their light examine how each of us lives and acts to-

wards others. But personal conversion is not gained

once and for all. It is a process that goes on through

our entire life. Conversion, moreover, takes place in

the context of a larger faith community; through bap-

tism into the Church, through common prayer, and

through our activity with others on behalf of justice.

2. Worship and Prayer

329. Challenging U.S. economic life with the Chris-

tian vision calls for a deeper awareness of the integral

connection between worship and the world of work.

Worship and common prayer are the wellsprings that

give life to any reflection on economic problems and

that continually call the participants to greater fidelity

to discipleship. To worship and pray to the God of

the universe is to acknowledge that the healing love

of God extends to all persons and to every part of

existence, including work, leisure, money, economic

and political power and their use, and to all those

practical policies that either lead to justice or impede

it. Therefore, when Christians come together in prayer.

’ Medellin Documents: Justice (1968), 4.

165



they make a commitment to carry God's love into all

these areas of life.

330. The unity of work and worship finds expres-

sion in a unique way in the Eucharist. As people of

a new covenant, the faithful hear God's challenging

word proclaimed to them—a message of hope to the
poor and oppressed—and they call upon the Holy
Spirit to unite all into one body of Christ. For the

Eucharist to be a living promise of the fullness of God's

Kingdom, the faithful must commit themselves to liv-

ing as redeemed people with the same care and love

for all people that Jesus showed. The body of Christ

which worshipers receive in Communion is also a

reminder of the reconciling power of his death on the

Cross. It empowers them to work to heal the broken-

ness of society and human relationships and to grow

in a spirit of self-giving for others.

331. The liturgy teaches us to have grateful hearts:

to thank God for the gift of life, the gift of this earth,

and the gift of all people. It turns our hearts from self-

seeking to a spirituality that sees the signs of true

discipleship in our sharing of goods and working for

justice. By uniting us in prayer with all the people of

God, with the rich and the poor, with those near and

dear, and with those in distant lands, liturgy chal-

lenges our way of living and refines our values. To-

gether in the community of worship, we are

encouraged to use the goods of this earth for the

benefit of all. In worship and in deeds for justice, the

Church becomes a "sacrament," a visible sign of that

unity in justice and peace that God wills for the whole

of humanity.'*

* Dogmatic Constitution on the Church, 1; Pastoral Constitution, 42,

45; Constitution on the Liturgy, 26; Decree on the Church's Missionary

Activity, 5; Liturgy and Social Justice, ed. by Mark Searle, (College-

ville, Minn.: Liturgical Press, 1980); National Conference of Catholic

Bishops, The Church at Prayer (Washington, D.C.: USCC Office of

Publishing and Promotion Services, 1983).

166



3. Call to Holiness in the World

332. Holiness is not limited to the sanctuary or to

moments of private prayer; it is a call to direct our
whole heart and life toward God and according to
God's plan for this world. For the laity holiness is

achieved in the midst of the world, in family, in com-
munity, in friendships, in work, in leisure, in citizen-

ship. Through their competency and by their activity,
lay men and women have the vocation to bring the
light of the Gospel to economic affairs, "so that the
world may be filled with the Spirit of Christ and may
more effectively attain its destiny in justice, in love,
and in peace."®

333. But as disciples of Christ we must constantly
ask ourselves how deeply the biblical and ethical vi-
sion of justice and love permeates our thinking. How
thoroughly does it influence our way of life? We may
hide behind the complexity of the issues or dismiss
the significance of our personal contribution; in fact,
each one has a role to play, because every day each
one makes economic decisions. Some, by reason of
their work or their position in society, have a vocation
to be involved in a more decisive way in those deci-
sions that affect the economic well-being of others.
They must be encouraged and sustained by all in their
search for greater justice.

334. At times we will be called upon to say no to
the cultural manifestations that emphasize values and
aims that are selfish, wasteful, and opposed to the
Scriptures. Together we must reflect on our personal
and family decisions and curb unnecessary wants in
order to meet the needs of others. There are many
questions we must keep asking ourselves: Are we
becoming ever more wasteful in a "throw-away" so-

’ Dogmatic Constitution on the Church, 36 .

167



dety? Are we able to distinguish between our true

needs and those thrust on us by advertising and a

sodety that values consumption more than saving?

All of us could well ask ourselves whether as a Chris-

tian prophetic witness we are not called to adopt a

simpler lifestyle, in the face of the excessive accu-

mulation of material goods that characterizes an af-

fluent society.

335. Husbands and wives, in particular, should

weigh their needs carefully and establish a proper

priority of values as they discuss the questions of both

parents working outside the home and the respon-

sibilities of raising children with proper care and at-

tention. At times we will be called as individuals, as

families, as parishes, as Church, to identify more

closely with the poor in their struggle for participation

and to close the gap of understanding between them

and the affluent. By sharing the perspectives of those

who are suffering, we can come to understand eco-

nomic and social problems in a deeper way, thus lead-

ing us to seek more durable solutions.

336. In the workplace the laity are often called to

make tough decisions with little information about

the consequences that such decisions have on the

economic lives of others. Such times call for collab-

orative dialogue together with prayerful reflection on

Scripture and ethical norms. The same can be said of

the need to elaborate policies that will reflect sound

ethical principles and that can become a part of our

political and social system. Since this is a part of the

lay vocation and its call to holiness, the laity must

seek to instill a moral and ethical dimension into the

public debate on these issues and help enunciate the

ethical questions that must be faced. To weigh political

options according to criteria that go beyond efficiency

and expediency requires prayer, reflection, and dia-

logue on all the ethical norms involved. Holiness for

the laity will involve all the sacrifices needed to lead



such a life of prayer and reflection within a worshiping

and supporting faith community. In this way the laity

will bridge the gap that so easily arises between the

moral principles that guide the personal life of the

Christian and the considerations that govern decisions

in society in the political forum and in the market-

place.

4. Leisure

337. Some of the difficulty in bringing Christian

faith to economic life in the United States today results

from the obstacles to establishing a balance of labor

and leisure in daily life. Tedious and boring work leads

some to look for fulfillment only during time off the

job. Others have become "workaholics," people who

work compulsively and without reflection on the

deeper meaning of life and their actions. The quality

and pace of work should be more human in scale

enabling people to experience the dignity and value

of their work and giving them time for other duties

and obligations. This balance is vitally important for

sustaining the social, political, educational, and cul-

tural structures of society. The family, in particular,

requires such balance. Without leisure there is too

little time for nurturing marriages, for developing

parent-child relationships, and for fulfilling commit-

ments to other important groups: the extended family,

the community of friends, the parish, the neighbor-

hood, schools, and political organizations. Why is it
one hears so little today about shortening the work

week, especially if both parents are working? Such a

change would give them more time for each other,

for their children, and for their other social and po-

litical responsibilities.

338. Leisure is connected to the whole of one's

value system and influenced by the general culture

one lives in. It can be trivialized into boredom and

169



laziness, or end in nothing but a desiie for greater

consumption and waste. For disciples of Christ, the

use of leisure may demand being countercultural. The

Christian tradition sees in leisure, time to build family

and societal relationships and an opportunity for com-

munal prayer and worship, for relaxed contemplation

and enjoyment of God's creation, and for the culti-

vation of the arts which help fill the human longing

for wholeness. Most of all, we must be convinced that

economic decisions affect our use of leisure and that

such decisions are also to be based on moral and

ethical considerations. In this area of leisure we must

be on our guard against being swept along by a lack

of cultural values and by the changing fads of an

affluent society. In the creation narrative God worked

six days to create the world and rested on the seventh

(Gn 2:1-4). We must take that image seriously and
learn how to harmonize action and rest, work and

leisure, so that both contribute to building up the

person as well as the family and community.

B. Challenges to the Church

339. The Church is all the people of God, gathered

in smaller faith communities, guided and served by

a pope and a hierarchy of bishops, ministered to by

priests, deacons, religious, and laity, through visible

institutions and agencies. Church is, thus, primarily

a communion of people bonded by the Spirit with

Christ as their Head, sustaining one another in love,

and acting as a sign or sacrament in the world. By its

nature it is people called to a transcendent end; but,

it is also a visible social institution functioning in this

world. According to their calling, members participate

in the mission and work of the Church and share, to

170



varying degrees, the responsibility for its institutions

and agencies.*

At this moment in history, it is particularly impor-

tant to emphasize the responsibilities of the whole

Church for education and family life.

1. Education

340. We have already emphasized the commitment
to quality education that is necessary if the poor are

to take their rightful place in the economic structures

of our society. We have called the Church to remember
its own obligation in this regard and we have endorsed

support for improvements in public education.

341. The educational mission of the Church is not

only to the poor but to all its members. We reiterate
our 1972 statement: "Through education, the Church

seeks to prepare its members to proclaim the Good

News and to translate this proclamation into action.

Since the Christian vocation is a call to transform one-

self and society with God's help, the educational ef-

forts of the Church must encompass the twin purposes

of personal sanctification and social reform in the light

of Christian values."^ Through her educational mis-

sion the Church seeks: to integrate knowledge about

this world with revelation about God; to understand

God's relationship to the human race and its ultimate

destiny in the Kingdom of God; to build up human

communities of justice and peace; and to teach the

value of all creation. By inculcating these values the

educational system of the Church contributes to so-

ciety and to social justice. Economic questions are,

thus, seen as a part of a larger vision of the human

** justice in the World, 41

.

^ National Conference of Catholic Bishops, To Teach as Jesus Did,

A Pastoral Message on Education (Washington, D.C.: USCC Office
of Publishing and Promotion Services, 1972), 7.

171



person and the human family, the value of this created

earth, and the duties and responsibilities that all have

toward each other and toward this universe.

342. For these reasons the Church must incorporate

into all levels of her educational system the teaching

of social justice and the biblical and ethical principles

that support it. We call on our universities, in partic-
ular, to make Catholic social teaching, and the social

encyclicals of the popes a part of their curriculum,

especially for those whose vocation will call them to

an active role in U.S. economic and political decision

making. Faith and technological progress are not op-

posed one to another, but this progress must not be

channeled and directed by greed, self-indulgence, or

novelty for its own sake, but by values that respect

human dignity and foster social solidarity.

343. The Church has always held that the first task

and responsibility for education lies in the hands of

parents: they have the right to choose freely the schools

or other means necessary to educate their children in

the faith.® The Church also has consistently held that

public authorities must ensure that public subsidies

for the education of chUdren are allocated so that par-

ents can freely choose to exercise this right without

incurring unjust burdens. This parental right should

not be taken from them. We call again for equitable
sharing in public benefits for those parents who choose

private and religious schools for their children. Such

help should be available especially for low-income

parents. Though many of these parents sacrifice a

great deal for their children's education, others are

effectively deprived of the possibility of exercising this

right.

* Cf. Vatican Council II, Declaration on Christian Education, 3, 6.

See also, Charter of the Rights of the Family, 5b; Instruction on Christian

Freedom and Liberation, 94.

172



2. Supporting the Family

344. Economic life has a profound effect on all social

structures and particularly on the family. A break-
down of family life often brings with it hardship and

poverty. Divorce, failure to provide support to moth-

ers and children, abandonment of children, pregnan-

cies out of wedlock, all contribute to the amount of

poverty among us. Though these breakdowns of mar-

riage and the family are more visible among the poor,

they do not affect only that one segment of our society.

In fact, one could argue that many of these break-

downs come from the false values found among the

more affluent—values which ultimately pervade the
whole of society.

345. More studies are needed to probe the possible

connections between affluence and family and marital

breakdowns. The constant seeking for self-gratifica-

tion and the exaggerated individualism of our age,

spurred on by false values often seen in advertising

and on television, contribute to the lack of firm com-

mitment in marriage and to destructive notions of

responsibility and personal growth.’

346. With good reason, the Church has traditionally

held that the family is the basic building block of any

society. In fighting against economic arrangements

that weaken the family, the Church contributes to the

well-being of society. The same must be said of the

Church's teaching on responsible human sexuality

and its relationship to marriage and family. Economic

’ Pope John Paul II, On the Family (Washington, D.C.: USCC
Office of Publishing and Promotion Services, 1981), 6. See also

Robert N. Bellah, Richard Madsen, William M. Sullivan, Ann Swid-
ler, Steven M. Tipton, Habits of the Heart: Individualism and Com-

mitment in American Life (Berkeley: University of California Press,

1985); The Family Today and Tomorrow: The Church Addresses Her Future

(Boston, Mass.: The Pope John Center, 1985).

173



arrangements must support the family and promote

its solidity.

3. The Church as Economic Actor

347. Although all members of the Church are eco-

nomic actors every day in their individual lives, they

also play an economic role united together as Church.

On the parish and diocesan level, through its agencies
and institutions, the Church employs many people;

it has investments; it has extensive properties for wor-

ship and mission. All the moral principles that govern

the just operation of any economic endeavor apply to the

Church and its agencies and institutions; indeed the Church

should be exemplary. The Synod of Bishops in 1971

worded this challenge most aptly: "While the Church

is bound to give witness to justice, she recognizes that

anyone who ventures to speak to people about justice

must first be just in their eyes. Hence, we must un-

dertake an examination of the modes of acting and of

the possessions and lifestyle found within the Church

herself."’®

348. Catholics in the United States can be justly

proud of their accomplishments in building and main-

taining churches and chapels, and an extensive sys-

tem of schools, hospitals, and charitable institutions.

Through sacrifices and personal labor our immigrant

ancestors buUt these institutions. For many decades

religious orders of women and men taught in our

schools and worked in our hospitals with very little

remuneration. Right now, we see the same spirit of

generosity among the religious and lay people even

as we seek to pay more adequate salaries.

349. We would be insincere were we to deny a need
for renewal in the economic life of the Church itself

“ Justice in the World, 40.

174



and for renewed zeal on the part of the Church in

examining its role in the larger context of reinforcing

in U.S. society and culture those values that support

economic justice.'*

350. We select here five areas for special reflection:

(1) wages and salaries, (2) rights of employees, (3)

investments and property, (4) works of charity, and

(5) working for economic justice.

351. We bishops commit ourselves to the principle
that those who serve the Church— laity, clergy, and
religious—should receive a sufficient livelihood and
the social benefits provided by responsible employers

in our nation. These obligations, however, cannot be

met without the increased contributions of all the

members of the Church. We call on all to recognize
their responsibility to contribute monetarily to the

support of those who carry out the public mission of

the Church. Sacrificial giving or tithing by all the Peo-

ple of God would provide the funds necessary to pay

these adequate salaries for religious and lay people;

the lack of funds is the usual underlying cause for the

lack of adequate salaries. The obligation to sustain the

Church's institutions—education and health care, so-
cial service agencies, religious education programs,

care of the elderly, youth ministry, and the like—falls
on all the members of the community because of their

baptism; the obligation is not just on the users or on

those who staff them. Increased resources are also

needed for the support of elderly members of religious

communities. These dedicated women and men have
not always asked for or received the stipends and

pensions that would have assured their future. It would

be a breach of our obligations to them to let them or

their communities face retirement without adequate

funds.

" Dogrrmtic Constitution on the Church, 8 .

175



352. Many volunteers provide services to tne Churcn

and its mission which cannot be measured in dollars

and cents. These services are important to the life and

vitality of the Church in the United States and carry

on a practice that has marked the history of the Church

in this country since its founding. In this tradition,

we ask young people to make themselves available

for a year or more of voluntary service before

beginning their training for more specific vocations

in life; we also recommend expanding voluntary

service roles for retired persons; we encourage those

who have accepted this challenge.
353. All church institutions must also fully recog-

nize the rights of employees to organize and bargain

collectively with the institution through whatever as-

sociation or organization they freely choose.'^ In the

light of new creative models of collaboration between

labor and management described earlier in this letter,

we chaUenge our church institutions to adopt new

fruitful modes of cooperation. Although the Church

has its own nature and mission that must be respected

and fostered, we are pleased that many who are not

of our faith, but who share similar hopes and aspi-

rations for the human family, work for us and with

us in achieving this vision. In seeking greater justice

in wages, we recognize the need to be alert particularly

to the continuing discrimination against women

throughout Church and society, especially reflected

in both the inequities of salaries between women and

men and in the concentration of women in jobs at the

lower end of the wage scale.

354. Individual Christians who are shareholders

and those responsible within church institutions that

own stocks in U.S. corporations must see to it that

National Conference of Catholic Bishops, Health and Health

Care (Washington, D.C.: USCC Office of Publishing and Promotion

Services, 1981), 50.

176



the invested funds are used responsibly. Although it

is a moral and legal fiduciary responsibility of the

trustees to ensure an adequate return on investment

for the support of the work of the Church, their stew-

ardship embraces broader moral concerns. As part-

owners, they must cooperate in shaping the poUcies

of those companies through dialogue with manage-

ment, through votes at corporate meetings, through

the introduction of resolutions, and through partici-

pation in investment decisions. We praise the efforts
of dioceses and other religious and ecumenical bodies

that work together toward these goals. We also praise
efforts to develop alternative investment policies, es-

pecially those which support enterprises that promote

economic development in depressed coimnunities and

which help the Church respond to local and regional

needs. V^en the decision to divest seems unavoid-
able, it should be done after prudent examination and

with a clear explanation of the motives.

355. The use of church property demands special
attention today. Changing demographic patterns have

left many parishes and institutions with empty or
partially used buildings. The decline in the number
of religious who are teaching in the schools and the
reduction in the number of clergy often result in large
residences with few occupants. In this regard, the

Church must be sensitive to the image the possession

of such large facilities often projects, namely, that it

is wealthy and extravagant in the use of its resources.

This image can be overcome only by clear public ac-

countability of its financial holdings, of its properties

and their use, and of the services it renders to its
members and to society at large. We support and
encourage the creative use of these facilities by many
parishes and dioceses to serve the needs of the poor.

See ch. IV of this pastoral letter.

177



356. The Church has a special call to be a servant

of the poor, the sick, and the marginalized, thereby

becoming a true sign of the Church's mission—a mis-
sion shared by every member of the Christian com-

munity. The Church now serves many such people

through one of the largest private human services

delivery systems in the country. The networks of

agencies, institutions, and programs provide services

to millions of persons of all faiths. Still we must be

reminded that in our day our Christian concerns must

increase and extend beyond our borders, because

everyone in need is our neighbor. We must also be
reminded that charity requires more than alleviating

misery. It demands genuine love for the person in

need. It should probe the meaning of suffering and

provoke a response that seeks to remedy causes. True

charity leads to advocacy.

357. Yet charity alone is not a corrective to all eco-

nomic social ills. All citizens, working through various

organizations of society and through government, bear

the responsibility of caring for those who are in need.

The Church, too, through all its members individually

and through its agencies, must work to alleviate in-

justices that prevent some from participating fully in

economic life. Our experience with the Campaign for

Human Development confirms our judgment about

the validity of self-help and empowerment of the poor.

The campaign, which has received the positive sup-

port of American Catholics since it was launched in

1970, provides a model that we think sets a high stan-

dard for similar efforts. We bishops know of the many
faithful in all walks of life who use their skills and

their compassion to seek innovative ways to carry out

the goals we are proposing in this letter. As they do

this, they are the Church acting for economic justice.

At the same time, we hope they will join together

with us and their priests to influence our society so

that even more steps can be taken to alleviate injus-

178



tices. Grassroots efforts by the poor themselves, helped

by community support, are indispensable. The entire

Christian community can learn much from the way

our deprived brothers and sisters assist each other in

their struggles.

358.

In addition to being an economic actor, the

Church is a significant cultural actor concerned about

the deeper cultural roots of our economic problems.

As we have proposed a new experiment in collabo-

ration and participation in decision making by all those

affected at all levels of U. S. society, so we also commit

the Church to become a model of collaboration and

participation.

C. The Road Ahead

359. The completion of a letter such as this one is

but the beginning of a long process of education, dis-

cussion and action; its contents must be brought to

all members of the Church and of society.

360. In this respect we mentioned the twofold aim

of this pastoral letter: to help Catholics form their

consciences on the moral dimensions of economic de-

cision making and to articulate a moral perspective in

the general societal and political debate that surrounds

these questions. These two purposes help us to reflect

on the different ways the institutions and ministers

of the Church can assist the laity in their vocation in

the world. Renewed emphasis on Catholic social

teaching in our schools, colleges, and universities;

special seminars with corporate officials, union lead-

ers, legislators, bankers, and the like; the organization

of small groups composed of people from different

ways of life to meditate together on the Gospel and

ethical norms; speakers' bureaus; family programs;

clearinghouses of available material; pulpit aids for

179



priests; diocesan television and radio programs; re-

search projects in our universities—all of these are
appropriate means for continued discussion and ac-

tion. Some of these are done best on the parish level,

others by the state Catholic conferences, and others

by the National Conference of Catholic Bishops. These

same bodies can assist the laity in the many difficult

decisions that deal with political options that affect

economic decisions. Where many options are avail-

able, it must be the concern of all in such debates that

we as Catholics do not become polarized. All must

be challenged to show how the decisions they make

and the policies they suggest flow from the ethical

moral vision outlined here. As new problems arise,

we hope through our continual reflection that we will

be able to help refine Catholic social teaching and

contribute to its further development.

361 . We call upon our priests, in particular, to con-
tinue their study of these issues, so that they can

proclaim the gospel message in a way that not only

challenges the faithful but also sustains and encour-

ages their vocation in and to the world. Priestly for-

mation in our seminaries will also have to prepare

candidates for this role.

362. We wish to emphasize the need to undertake
research into many of the areas this document could

not deal with in depth and to continue exploration of

those we have dealt with. We encourage our Catholic
universities, foundations, and other institutions to as-

sist in these necessary projects. The following areas

for further research are merely suggestive, not ex-

haustive: the impact of arms production and large

military spending on the domestic economy and on

culture; arms production and sales as they relate to

Third World poverty; tax reforms to express the pref-

erential option for the poor; the rights of women and

minorities in the work force; the development of com-

munications technology and its global influences; ro-

180



botics, automation, and reduction of defense industries

as they will affect employment; the economy and the

stability of the family; legitimate profit versus greed;

securing economic rights; environmental and ecolog-

ical questions; future roles of labor and unions; in-

ternational financial institutions and Third World debt;

our national deficit; world food problems; "full em-

ployment" and its implementation; plant closings and

dealing with the human costs of an evolving economy;

cooperatives and new modes of sharing; welfare re-

form and national eligibility standards; income sup-

port systems; concentration of land ownership;

assistance to Third World nations; migration and its

effects; population policies and development; the ef-

fects of increased inequality of incomes in society.

D. Commitment to a Kingdom of

Love and Justice

363. Confronted by this economic complexity and

seeking clarity for the future, we can rightly ask our-

selves one single question: How does our economic
system affect the lives of people—all people? Part of
the American dream has been to make this world a

better place for people to live in; at this moment of

history that dream must include everyone on this

globe. Since we profess to be members of a "catholic"

or universal Church, we all must raise our sights to

a concern for the well-being of everyone in the world.

Third World debt becomes our problem. Famine and

starvation in sub-Saharan Africa become our concern.

Rising military expenditures everywhere in the world

become part of our fears for the future of this planet.

We cannot be content if we see ecological neglect or
the squandering of natural resources. In this letter we

bishops have spoken often of economic interdepen-

181



dence; now is the moment when all of us must con-

front the reality of such economic bonding and its

consequences and see it as a moment of grace—

a

kairos—that can unite all of us in a common com-
munity of the human family. We commit ourselves
to this global vision.

364. We cannot be frightened by the magnitude
and complexity of these problems. We must not be
discouraged. In the midst of this struggle, it is inev-

itable that we become aware of greed, laziness, and

envy. No utopia is possible on this earth; but as be-

lievers in the redemptive love of God and as those

who have experienced God's forgiving mercy, we

know that God's providence is not and will not be

lacking to us today.

365. The fulfillment of human needs, we know, is

not the final purpose of the creation of the human

person. We have been created to share in the divine
life through a destiny that goes far beyond our human

capabilities and before which we must in all humility

stand in awe. Like Mary in proclaiming her Magnificat,

we marvel at the wonders God has done for us, how

God has raised up the poor and the lowly and prom-

ised great things for them in the Kingdom. God now

asks of us sacrifices and reflection on our reverence

for human dignity—in ourselves and in others—and
on our service and discipleship, so that the divine

goal for the human family and this earth can be ful-

filled. Communion with God, sharing God's life, in-

volves a mutual bonding with all on this globe. Jesus

taught us to love God and one another and that the

concept of neighbor is without limit. We know that
we are called to be members of a new covenant of

love. We have to move from our devotion to inde-
pendence, through an understanding of interde-

pendence, to a commitment to human solidarity. That

challenge must find its realization in the kind of corn-

182



munity we build among us. Love implies concern for

all—especially the poor—and a continued search for
those social and economic structures that permit

everyone to share in a community that is a part of a

redeemed creation (Rom 8:21-23).

183





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188





V





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