An older but still all-too-relevant article from Angus Sibley on Hayek, Novak & The Limits of Lassez Faire. This expose’ on the “cult of capitalism” is fitting in light of the rise of the GOP’s “intellectual” Paul Ryan, who manages to transcend cognitive dissonance by pledging intellectual adherence to both Ayn Rand and the Gospel of Jesus Christ.
When laissez-faire economists believe in God, they are usually certain that he is one of them. The invisible hand of the market is, they think, also the hand of Divine Providence, which anoints and protects those who manage to provide for themselves.
Although the gulf between Hayek and mainstream Catholicism yawns wide, neoconservative Catholics have striven to bridge it. They believe that Catholic doctrine can be interpreted in such a way as to legitimize laissez-faire capitalism. Since Michael Novak is among the best-known of these Catholics, let us consider how his views reflect, but also diverge from, those of Hayek.
But, like Hayek, Novak does not consider economic inequality a problem. “Under democratic capitalism, inequalities of wealth and power are not considered evil in themselves…. Nature itself generates inequalities,” he writes in The Spirit of Democratic Capitalism (1991). Or, as he puts it in Three in One (2000), “It is not unjust if some acorns fail to become oaks.” By contrast, in a speech he gave on May 13, 2006, Benedict XVI affirmed that “it is right to foster equality in the distribution of wealth in the world.”
Novak has argued that “productive justice” is fundamentally more important than distributive justice, for the latter depends on the former. Wealth must be produced before it can be shared. The top priority, therefore, should be to increase output, so that there will be more for everybody. This is an argument dear to many defenders of laissez-faire capitalism, but it ill accords with the evidence of recent American history: despite robust growth, inequalities have increased, while poverty and insecurity are more widespread and fewer and fewer people can afford medical care. Nor does this argument address the urgent need to curb the environmental ravages of rapid economic expansion. Novak denies that there are real limits to growth, and he decries those who see social justice as a “zero-sum game” of distributing fairly a limited pool of riches. But ecologists warn that we are already consuming the earth’s resources at a more-than-sustainable pace, even though many people are still extremely poor. The World Wildlife Fund’s Living Planet Report gives a detailed analysis covering most countries in the world. According to the report, the overall consumption of natural resources is running at a rate 25 percent above what is sustainable for our planet. It would seem, then, that there are indeed certain natural limits to economic growth.
For more good insights on the history underpinning the debate between “negative liberty” versus “postive liberty”, I highly recommend the documentary work of Adam Curtis, with his work The Trap: What Happened to Our Dream of Freedom (Part 3: We Will Force You To Be Free).