I’m reading, what I consider the single best expression of the social teaching of the Church, the two volume work by Rodger Charles S.J., published in Great Britain in 1998, Christian Social Witness and Teaching: The Catholic Tradition from Genesis to Centesimus Annus (Volume 1) & (Volume 2) The Modern Social Teaching Contexts: Summaries: Analysis; and in Volume 2, I just read a section on the world economic crisis of 1929-1934, and the parallels to what we are now going through are astounding.
An excellent review of the full work is at the Acton Institute’s Journal of Markets & Morality, and the best place to find both volumes is either through Abe Books or through the publisher, Gracewing Publishing.
This is the conclusion of three parts excerpted from volume 2 of Fr. Charles’ book.
Here is the excerpt.
“The international economy therefore had become unstable because the conditions which had made the 1914 structures operate so efficiently no longer existed, and the conditions of the late 1920’s in the United States combined to bring out the weaknesses in that economy. The Young Plan agreed in 1929, on which German hopes of long-term economic stability depended, assumed the continuance of those short-term loans which the country had attracted and Dr. Stresemann had warned in 1928 that ‘if a crisis were to arise and the Americans called in their short-term loans we would be faced with bankruptcy’. It was precisely that situation which came to be a year later.
“The result of the slowing down of German economic activity was a growing increase in the number of unemployed: there were 1.3 million in 1929; a year later that figure had nearly tripled to 3.14 million. It was no accident that the Nazis for the first time became a major political force in 1930. The number of the seats they held in the Reichstag leaped from 12 to 107. It continued to grow as the crisis deepened, and though they never received a popular majority, they were a very powerful minority and the ruthlessness and uncanny judgment of their leader enabled him to exploit the weaknesses of a crumbling political system to lie, bully and cheat his way to absolute power.
“Great Britain had not prospered in the 1920s, mainly because of the poor performance of her basic industries and the effects of the 1925 return to gold at a level which overvalued the pound. Ironically the shock of the depression was somewhat lessened by this unfortunate inheritance. The continuing grimness of life for many and the apparent miserliness of the government’s response to the extra social needs of a continued and deepened economic depression further embittered and soured social and industrial relations. In the United States, the depression cut deep indeed. By 1932 stock prices had fallen 83 per cent from their peak, production 40 per cent, wages 60 per cent and dividends 57 per cent; between fifteen and seventeen million were unemployed, money had lost half its value and credit could not be had. Conditions such as these were a challenge and not only to the political stability of the weakened and short-lived German democracy. They were threatening the world’s two oldest and most stable democracies, that of Britain and the USA. The attractions of Fascism and Marxism, promising strong leadership in the face of growing chaos, and the advent of a form of social planning that would avoid the wild gyrations of the capitalist system, were becoming attractive. That appeal was always limited but it was real throughout the 1930s and beyond. The lasting legacy in England was the Soviet spy network staffed by so many intellectually able young men of the middle and upper classes recruited in Cambridge University during this time. Fascism had its adherents too, but they did not pose the long-term threat of the dedicated communists. In the United States, the pattern was similar; the shock to the social fabric was stronger there since hopes had been high of perpetual prosperity in the 1920s and the scale of the subsequent recession was greater.
“The fundamental assumptions of Western society were in this period questioned more profoundly that at any time since the Enlightenment. The assurance that liberal democracy and capitalism were the only way to run a modern State that had grown up in its wake was no longer so self-confident. Democracy did not seem to be working as it should and capitalism seemed to be fundamentally harsh and cruel, with little place for justice, let alone for brotherhood, charity, or respect for common humanity and its needs. Any attempt at guidance by the Church in these circumstances would have to look to the social foundations of mature capitalism.
“The first purpose of Quadragesimo Anno (‘in the fortieth year’) was to celebrate the anniversary of Leo XIII’s great encyclical in 1891, but it was also to ‘summon to court the contemporary economic regime…passing judgment on socialism…[to] lay bare the root of the existing social confusion and at the same time to point the only way to a sound restoration’.
“It came to be subtitled ‘On reconstructing the social order’.” (pp. 62-63)
For the rest of this section Fr. Charles analyzes the encyclical and I would recommend that, in addition to buying the two volume work for your library, go to the Vatican website and read the great encyclical of 1931 by Pope Pius XI, Quadragesimo Anno: On reconstructing the social order.
I would also suggest you read what Pope Benedict XVI has been saying about the current economic situation, most recently in the Message for the celebration of the World Day of Peace 2009.
This concludes the series on world economics and the Church.
The great hush as the world awaits the coming is now beginning, enjoy your Christmas!