[ FINANCIAL CRISIS ] JESUIT REFLECTIONS ON THE FINANCIAL CRISIS
SOCIAL AND PASTORAL BULLETIN No. 151 / Oct 15, 2009

Social Justice Secretariat
The following articles were taken from the last issue of "Promotio Iustitiae," an official magazine of the Jesuit Social Secretariat (Rome). During the last years 2 significant Jesuit international meetings took place to deal with the global financial crisis affecting most countries and the social unrest occasioned by millions of workers that have lost their jobs and their sources of income.

We offer these articles here because we think that they provide deep insights for the Japanese situation. Japan has been seriously affected by the financial global crisis and the ensuing mass unemployment. During these last years the Japanese employment system has changed drastically, with an increase in the percentage of non-regular workers in service industries to over 40% and to 30% in the manufacturing industries.
The poverty gap has swollen and youth unemployment reached 8.7% in 2008. Over 10 million Japanese workers have a yearly income of less than 2 million yen, a poverty line in Japan. The government has curbed social security expenses and has privatized public services, with a resulting increase in the number of 'working poor,' who cannot maintain a minimum standard of living.
But, on the other hand, the recent change in the Japanese political system as a result of the last general elections has ignited new hope among the people. In the field of climate change the initiative of the new Hatoyama government to reduce CO2 emissions to 25% from 1990 levels by 2020 has obtained substantial international support. I want to keep an eye on how efficiently the Hatoyama government will be able to handle the actual economic and financial crisis.
[Ando Isamu SJ, Jesuit Social Center, Tokyo]
 
 
 Fernando Franco SJ (Social Justice Secretariat)
We have been repeatedly told that we live in a time of crisis. One senses, among people from the so-called 'rich' countries, a subtle resistance to these stories about the effects of this impending crisis. While the message dished out by the political class is that the crisis will pass and all will be well again, disquieting doubts remain in the hearts of many.
In the recent past, when stories were told about economic failures in countries among people living "out there," we felt, by and large, that the stories were credible but not very relevant to us who live in the first world. Now that we hear the story being told about friends and family members living in the 'affluent' world, we are tempted to think that, though blown somewhat out of proportion, they are suddenly quite relevant to our present and future dreams. The fear and anxiety of being thrown out of a job is no longer a third-world-country phenomenon, but something affecting the lives of people living in what has been projected as the 'promised' land.
As recently as a year ago it was unthinkable to talk about the ill effects of the process we have characterized somewhat fuzzily as 'globalization.' We all lived contented lives, basking in the myth that global economic growth was undisputed and unstoppable. The economic and technical forces unleashed by globalization could, we thought, solve the major ills affecting humankind. We lived through years of general optimism though there were voices that offered a critique of some aspects of this process. The debate as to whether 'globalization' can be steered in the right direction or whether we can promote the globalization of solidarity still seems to be open.
I feel, however, that the number of caveats to this optimistic view is increasing day by day.
We look with amazement and extreme surprise at the spectacle of company after company going under or announcing a severe reduction in its workforce. The collapse of banks and the closure of factories, as well as the increasing financial difficulties of certain colossal sports figures are accompanied by widespread social unrest, increasing environmental damage and an alarming and unexpected food crisis. More astonishing is the almost daily announcement of another financial fraud. We need to be honest and ask ourselves: did we not secretly believe that 'progress' would go on forever?
 

In the face of these signs of depression and unrest, however, there are also signals of an underlying shift towards some sort of collective sanity. The seriousness of climate change, for example, has been accepted, however limitedly, by large segments of society as well as by the political class. Alliances to defend the whole of life have been built across geographical, cultural and religious frontiers. International institutions like the United Nations and the International Labor Office have begun to acknowledge the constructive role that faiths can play in changing our ethical perspectives and influencing our behavior. The international Ignatian Advocacy Workshop held at El Escorial, Madrid, in November 2008 became a privileged space to reflect on some of these issues and, more importantly, to propose ways to influence public policies affecting the life of the poor and excluded in accordance with our Ignatian way of proceeding. This issue of Promotio presents a substantial coverage of the Workshop's deliberations and highlights its most important conclusions. Time will tell if the underlying model of cooperation and networking proposed at the Workshop can help to articulate the social work of the Society across the world.
 
 Frank Turner SJ
An international group of Jesuits gathered recently in Brussels (6-8 April 2009), hosted by OCIPE (Office Catholique d'Information et d'Initiative pour l'europe), to reflect on the interlocking crisis of the world's financial systems, its economies and its governance: all of which together could comprise, or at least provoke, a profound social crisis. In particular, we invite our Jesuit colleagues in Africa, Asia and the Americas to bring to this discussion what might be a quite different perspective.

 Snapshots of the Crisis
To say that the crisis is multi-faceted means that it can be viewed through a set of polarities, in tension with each other without being mutually exclusive. I take just two:

 1. Moral crisis or systemic crisis?
In the early days of the crisis, bankers and business executives were fiercely criticized, in terms of 'greed' and 'irresponsibility.' If the system had failed, it was held to be greed and irresponsibility that had built the system, beyond either the power or the will of governments to control. A variant on this kind of moral judgment is to say that the crisis has demonstrated a truth that we had hidden from ourselves for too long. The 'real economy' of goods and services links profit to success in meeting some public need or demand. Money, traditionally 'only' a means of exchange, becomes itself a product. In fact, quantitatively speaking the 'money economy,' far outweighs the 'real economy,' yet is so opaque that (as the crisis itself shows) even technical experts did not understand the risks they took. Such a bubble cannot but burst.
Not surprisingly, moral judgments may be made by those who adopt the Church's 'Option for the Poor,' since the excessive supply of money failed to reduce poverty. The present crisis therefore reveals the fragility of any economy that fails to serve human need. As the American theologian Joe Holland once said, 'The economy's doing fine, it's just the people having a hard time.'
On the other hand, is it more helpful to think of the crisis in terms of macro-economic systems, so that moral language becomes simply irrelevant? From this standpoint the problem is that the global market lacks global regulation, impeded by continued adherence to the concept of national sovereignty. This framework will not easily be rejected: no one expects the governments of China or the USA to submit to any external system of economic (or any other) governance. Even in the EU national sovereignty constantly prevails against the 'community method.' However, the crisis shows that 'sovereignty,' in the sense of the power to control events, is an illusion.
Japan's economy, for example, struggles because other countries cannot absorb its export capacity. So even if national sovereignty stills seems like political common sense - as once did slavery and the social subordination of women - 'common sense' is not set in stone.

 2. Short-term, and cyclical fluctuation? Or decisive collapse of an economic and social paradigm?
Already, the world's press is beginning to interpret rises in the stock markets as an indication that the crisis may have 'bottomed out.' If this is not wishful thinking, is this crisis just one phase of a natural cycle, a reaction to two decades of perhaps too-rapid growth? Is it, in fact, not really a crisis at all but merely an acute instance of a recurring phenomenon? Growth feeds on itself through a mechanism of confidence - easily becoming over-confidence - as high profits, and a steep rise in the price of such personal assets as housing, come to seem normal. A house may be regarded as not only a place to live, but as a foolproof investment, so that one might plunge into debt expecting a windfall later. The cyclical correction is harsh, and many people suffer. But we have always known that capitalism has victims and that risk-takers, by definition, might lose money.
Yet something more fundamental seems to be happening. The pillars of the system are fragile as never before: the biggest insurance company in the world (AIG, operating in one hundred countries) as well as major banks in the USA, the UK, and elsewhere needed rescuing. These institutions, so massive, so embedded in the international system, seemed less mere enterprises than guarantors of the system itself. They embodied the operational structure of 'trust' that buttresses people's sense of normality, if not actually of meaning. That trust is now deeply shaken: in what or whom, ultimately, is it appropriate to trust?

 Responses to the crisis
One of our stimulating but unresolved differences lay in our sense of what framework we, as Jesuits, might appropriately bring to this subject.
Is our discourse to be rooted in theology and Christian anthropology? Why should we feel compelled to abstract methodologically from the fundamental world-view that forms and sustains us? Why disable the only distinctive contribution we can bring? Is it not precisely this 'subversive' Christian vision that can best confront reductionist notions of freedom, the economy, the 'sovereign self,' that underlie the crisis? Institutions and systems always embody some social consciousness, some explicit or implicit intentionality.
They cannot be reformed without motivation (and therefore structures of meaning and commitment) adequate to the task.
On this view, contributing at this level is the foremost task of the Church. The contrary position argues that the Church is so widely perceived to make an a priori negative judgment on 'the world' that such a direct and principled challenge simply could not be heard, so that any possibility of dialogue is minimal. If we believe this, we will seek common ground either by minimizing overtly religious language, or by introducing it only in a 'second moment,' meanwhile seeking to meet other world-views on their own ground: only by proceeding in this way, in fact, can 'religious' discourse gain any purchase on economic realities.
We need, it seems, to be bilingual, to risk the language of faith but to ensure that it is manifestly anchored in human experience, in shared ethical reflection. By definition, one cannot conduct an open dialogue with those who are utterly closed. But one can - and we must - seek to remove unnecessary obstacles to mutual openness.

 Mediations
However tentatively, we proposed some perspectives to stimulate further discussion.

 1. A global perspective:
the Church is universal. The Society of Jesus itself proclaims a universal mission. It is this universality which can inspire us to reflect on issues such as migration, the environment, and the present crisis, without willfully restricting our horizon.

 2. Sustainability:
the Church, as well as the environmental movement, reacts to this tendency apprehensively. We need not 'de-growth' as such, but a sense of 'the richness of sufficiency' that embraces compassionate human concern and respect for the environment sustainability - but also, not least, implies the refusal to over-consume.

 3. Respect for the market as an instrument:
the market remains an essential clearing-house for goods and services. Our free markets are far from free, and if we accept economic globalization it should be reciprocal.
 4. Ethical critique of the market:
respect for the market must nevertheless be critical.
Free-market theory rests in a reductionist notion of freedom. In Centesimus Annus, however, Pope John Paul II contrasts a 'free-market economy' with a 'free economy' (§.15) precisely because justice and freedom are mutually dependent. Where an economic system is made absolute at the expense of other dimensions of human life, 'economic freedom' actually alienates and oppresses the human person (§.39).
 5. Shared but differentiated responsibility:
if 'the economy' is not reified but is seen to reflect human purposes, it becomes also the object of human responsibility. This claim has a range of implications:

a. Just as we are shaped by our society but also, together, shape what society is, so with the economy. Basic human needs are relatively fixed: desires are indefinitely malleable yet fall within the realm of our spiritual freedom. Persons change out of compulsion but also out of conviction. Many social movements function within the market while shifting its modalities: socially responsible investment, corporate social responsibility, micro-finance favoring the poor, etc.
b. Global negotiations must be truly global. As Pope Benedict wrote in March to the British Prime Minister, Gordon Brown, noting that the London G20 Summit was understandably restricted to states which represent 90% of the world's population and 80% of world trade: "This situation must prompt a profound reflection among the Summit participants, since those whose voice has least force in the political scene are precisely the ones who suffer most from the harmful effects of a crisis for which they do not bear responsibility. Furthermore, in the long run, it is they who have the most potential to contribute to the progress of everyone."
c. Responsibility' entails 'prudence.' Our problem is not simply one of 'greed' but of 'blind greed' - suppressing awareness of the costs and risks of profit.

 6. Solidarity, rooted in 'koinonia':
solidarity may be defined as 'the fundamental moral imperative that flows from the communal character of human life.'

 7. Gratuity:
to understand our life as gift (or 'grace'), and to live in this spirit is the most profound existential rejection of any world-view that reduces human persons to the status of homo economicus, and of the associated ideology of 'economism.'
 
  
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