The major argument against the capitalistic system is that it is governed by the rules of economics as defined by supply and demand—a system deemed by many to be more concerned for people than socialism—rather than the common good.
The major argument against the socialistic system is that it is governed by the rules of economics as defined by, to each according to his need—which is deemed by many to be more concerned for people than capitalism—rather than the individual’s ability to secure the good for himself.
Both systems ultimately fall upon the individuals who make the decisions governing the field of economic play, and if those individuals are strongly influenced by deep seated religious beliefs constructed on the root of Catholic faith—the sacredness of each individual human being—the resulting benefits will be more apt to be truly for the common good; and this is a governing principle true for any in leadership positions with high potential of corruption.
This was remarked on in an article by the future pope, Joseph Cardinal Ratzinger, in 1985.
“In the attempt to describe the constellation of a dialogue between Church and economy, I have discovered yet a fourth aspect. It may be seen in the well-known remark made by Theodore Roosevelt in 1912: “I believe that the assimilation of the Latin-American countries to the United States will be long and difficult as long as these countries remain Catholic.” Along the same lines, in a lecture in Rome in 1969, Rockefeller recommended replacing the Catholics there with other Christians — an undertaking which, as is well known, is in full swing. In both these remarks, religion — here a Christian denomination — is presupposed as a socio-political, and hence as an economic-political factor, which is fundamental for the development of political structures and economic possibilities. This reminds one of Max Weber's thesis about the inner connection between capitalism and Calvinism, between the formation of the economic order and the determining religious idea. Marx's notion seems to be almost inverted: it is not the economy that produces religious notions, but the fundamental religious orientation that decides which economic system can develop. The notion that only Protestantism can bring forth a free economy — whereas Catholicism includes no corresponding education to freedom and to the self-discipline necessary to it, favoring authoritarian systems instead — is doubtless even today still very widespread, and much in recent history seems to speak for it. On the other hand, we can no longer regard so naively the liberal-capitalistic system (even with all the corrections it has since received) as the salvation of the world. We are no longer in the Kennedy-era, with its Peace Corps optimism; the Third World's questions about the system may be partial, but they are not groundless. A self-criticism of the Christian confessions with respect to political and economic ethics is the first requirement.
“But this cannot proceed purely as a dialogue within the Church. It will be fruitful only if it is conducted with those Christians who manage the economy. A long tradition has led them to regard their Christianity as a private concern, while as members of the business community they abide by the laws of the economy.
“These realms have come to appear mutually exclusive in the modern context of the separation of the subjective and objective realms. But the whole point is precisely that they should meet, preserving their own integrity and yet inseparable. It is becoming an increasingly obvious fact of economic history that the development of economic systems which concentrate on the common good depends on a determinate ethical system, which in turn can be born and sustained only by strong religious convictions. Conversely, it has also become obvious that the decline of such discipline can actually cause the laws of the market to collapse. An economic policy that is ordered not only to the good of the group — indeed, not only to the common good of a determinate state — but to the common good of the family of man demands a maximum of ethical discipline and thus a maximum of religious strength. The political formation of a will that employs the inherent economic laws towards this goal appears, in spite of all humanitarian protestations, almost impossible today. It can only be realized if new ethical powers are completely set free. A morality that believes itself able to dispense with the technical knowledge of economic laws is not morality but moralism. As such it is the antithesis of morality. A scientific approach that believes itself capable of managing without an ethos misunderstands the reality of man. Therefore it is not scientific. Today we need a maximum of specialized economic understanding, but also a maximum of ethos so that specialized economic understanding may enter the service of the right goals. Only in this way will its knowledge be both politically practicable and socially tolerable.”