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WELCOME! CrossCurrents aims to provoke thought and enrich faith by interpreting current events in the light of Catholic tradition. I hope you find these columns both entertaining and clarifying. Your feedback and comments are welcome! See more about me and my work at http://home.comcast.net/~bfmswain/onlinestorage/index.html or contact me directly at bfswain@juno.com NOTE: TO READ OR WRITE COMMENTS, CLICK ON THE TITLE OF A POST.

Monday, December 3, 2012

#341: Warfare—or Justice?

As Warren Buffet makes the rounds promoting his new book, the old issues re-surface. So I am replaying this post from September 2011:

More than a year before the next presidential elections, the battle lines are already being drawn--and one phrase in the air seems likely to command increasing attention over the next 12 months. That phrase is “class warfare.” It’s a charge already being leveled against people as diverse as President Obama, billionaire Warren Buffett, and Harvard professor Elizabeth Warren. And it strikes me that this phrase offers a timely, even a perfect test-case for Catholic voters.

We Catholics now represent the largest “swing” voting group in the country. In 2004, Catholic John Kerry lost that swing to George W. Bush, but in 2008 Obama won the Catholic majority from John McCain. In both cases, the Catholic vote swung to the winner. So now when we hear talk of “independent voters,” we can think “Catholic voters.” And I like to think this means “independent-minded” as well. I would hope Catholic voters are Catholics first, and party supporters second--that our Catholic values trump party platforms and political preferences.

But it wasn’t so long ago that Catholic voters were largely working class, and many of them knew class warfare up close and personal (think “No Irish Need Apply”). And since the Democratic Party was, in the public’s eye, the workers’ party, Catholics were often bloc Democratic voters. In 1960 JFK won 80% of the Catholic vote.

Since then, Catholics have changed their class profile, emerging as among the best-educated and best-paid groups in America. The class profile of the two major parties has also changed, so it’s understandable if Catholics get confused about the issues and struggle to link their faith to their vote. It’s no longer as simple as checking the ballot for (D) or (R).

And when people start talking of “class warfare,” that makes matters even more confusing. It’s a serious charge, and demands a serious response. To get the clarity informed voting requires, we need to ask two things: What does class warfare mean? What should we think about it?

“Class warfare” sounds a lot like “class struggle,” the Marxist label for the process of workers wresting the means of production from the owners. But in today’s U.S. politics, “class warfare” has become a code word, like “socialism,” for any proposal to redistribute wealth within the population, especially through government action and taxation. It’s not about the workers seizing control of factories and companies, it’s about how much of their personal wealth rich Americans get to keep.

So what are the facts about the distribution of wealth in the U.S.? And what does our Catholic faith tradition have to say about it?

Frankly, the facts are surprisingly simple and obvious. For the last 40 years, the U.S. gap between rich and poor has steadily grown, because real wages for most have failed to match inflation, while the wealthiest Americans have enjoyed soaring dividends, salaries, and bonuses. The U.S. bishops, a dozen years into this trend, were already expressing concern in 1983:

Our economy is marked by a very uneven distribution of wealth and income. For example, it is estimated that 28% of the total net wealth is held by the richest 2% of families in the U.S. The top 10% holds 57% 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% of the total net financial assets were held by 2% of all families, those whose annual income is over $125,000. Eighty-six percent of these assets were held by the top 10% of all families.-- (US Bishops Economic Justice For All [EJA] #183)

By 2010, the situation was even worse, as the gap just kept growing, according to a UC Berkeley analysis:

“In the economic expansion of 2002-2007, the top 1% captured two thirds of income growth.”As others have pointed out, the average wage of Americans, adjusting for inflation, is lower than it was in the 1970s. The minimum wage, adjusting for inflation, is lower than it was in the 1950s…On the other hand, billionaires have never had it better. --http://integralcatholicsocialteachings.blogspot.com/2009/08/income-inequality-worst-since-1917.html

Is anyone who criticizes this trend engaging in “class warfare”? I suppose that is mainly a question of definitions, but let’s suppose we accept “class warfare” as the label for a debate about income distribution, income inequality, and income redistribution? In that case, two things stand out.

One, there are fighters on both sides: those defending the poor, and those defending the wealthy. Second, there seem to be two sets of rules. Those on the “poor” side are attacking the behavior and special treatment the wealthy get (Warren Buffett called it “coddling”) to urge a change in the status quo. But the “wealthy” side has been attacking the character of the poor as a way of blocking any change.

Thus one TV commentator describes this as a war of the “productive classes” attacked by the “moocher classes.” John Stossel likewise sees a conflict between the “makers” and the “takers.” Another pundit refers to welfare recipients as “parasites.” Nebraska Atty. General John Bruning compares “stupid welfare recipients” to scavenging “raccoons.” Ann Coulter argues that the U.S. welfare system creates “generations of utterly irresponsible animals.” Even warfare has rules, but so far only one side is playing fair.

So given the facts about U.S. wealth and the way people are fighting over it, what are Catholic voters to think? Once again, the answer is surprisingly straightforward. In a word: Catholic Social Doctrine has consistently opposed wide income gaps between rich and poor, and has consistently approved actions to redistribute wealth. Leo XIII first set this position in 1891, and he was seconded in 1931 by Pius XI:

Each class, then, must receive its due share, and the distribution of created goods must be brought into conformity with the demands of the common good and social justice. For every sincere observer realizes that the vast difference between the few who hold excessive wealth and the many who live in destitution constitute a grave evil in modern society-- (Quadragesimo Anno #58).

Vatican Council II (1962-1965) repeated the same basic position:

Excessive economic and social inequalities within the one human family, between individuals or between peoples, give rise to scandal, and are contrary to social justice, to equity, and to the dignity of the human person, as well as to peace within society and at the international level--(Gaudiam Et Spes #29).

This position reflects a main principle of Catholic social teaching: “The Universal Destination of Material Goods,” and this combines with another principle, the “Preferential Option for the Poor,” as the U.S. Bishops explained in 1983:

As individuals and as a nation, therefore, we are called to make a fundamental "option for the poor". The obligation to evaluate social and economic 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 marginalized and whose rights are denied have privileged claims if society is to provide justice for all. This obligation is deeply rooted in Christian belief.-- (EJA #87)

These two principles establish “Catholic” economic priorities that many Catholics have never been taught:

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 uncontrolled industrial expansion; the production to meet social needs over production for military purposes.-- (EJA #94)

This leads to a clear Catholic mandate to support changes, even government policies, that redistribute wealth:

Authentic economic well-being is pursued also by means of suitable social policies for the redistribution of income which, taking general conditions into account, look at merit as well as at the need of each citizen.--(The Compendium of the Social Doctrine of the Catholic Church #303)

Does this mean the Catholic Church has been waging “class warfare” since 1891? I think not. Instead, I agree with the U.S. Bishops in saying:

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 powerlessness 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. (EJA #88)

From the Catholic viewpoint, this is not class warfare; this is a fight for justice. And, as Pope Benedict XVI proclaimed in his very first encyclical, God Is Love: “The Church…cannot and must not remain on the sidelines in the fight for justice.”

So each of us must ask ourselves, and even each other, the next question: if the fight for justice is underway, which side are you on?
©Bernard F. Swain PhD 2011

3 comments:

  1. It is unfortunate that you chose to repeat this column, as it is very divisive, as evidenced by the conclusion, "which side are you on?"

    Few bishops are trained in economics, so while their pronouncements regarding appropriate policy goals deserve much respect, their assessments of means of achieving the goals are highly questionable.

    Few would argue that government should not provide any assistance to the poor. Few would argue that the government should distribute all income and all wealth equally. What principles should we apply to determine what level of government redistribution is just? Should our understanding of economics influence our thinking?

    It is easy to suggest that others who have higher income or more wealth should be forced to do more for the poor. It is much more difficult to assess our own actions.

    Currently, within our diocese, most of the money contributed by parishioners stays within the parish, regardless of the affluence of the parish community. Is this just, or should contributions be distributed equally within our diocese? Within the US? Throughout the world?

    Currently, our diocese pays several employees annual salaries exceeding $150,000. Is this just?

    Should we care only about inequality within the US, or should we also care about worldwide inequality? If our principles compel us to support increasing taxes and government spending in order to alleviate inequality within the US, should they also compel us to increase taxes on the US "middle class" as well as the rich in order to provide aid to poor in other countries?

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  2. Note:
    "Mr Buffett never mentions doing anything to eliminate the tax-avoidance strategies that he uses most aggressively. In particular:
    1. His company Berkshire Hathaway never pays a dividend but instead retains all earnings. So the return on this investment is entirely in the form of capital gains. By not paying dividends, he saves his investors (including himself) from having to immediately pay income tax on this income.
    2. Mr Buffett is a long-term investor, so he rarely sells and realizes a capital gain. His unrealized capital gains are untaxed.
    3. He is giving away much of his wealth to charity. He gets a deduction at the full market value of the stock he donates, most of which is unrealized (and therefore untaxed) capital gains.
    4. When he dies, his heirs will get a stepped-up basis. The income tax will never collect any revenue from the substantial unrealized capital gains he has been accumulating."
    http://gregmankiw.blogspot.com/2012/11/a-master-of-tax-avoidance.html

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  3. Naturally, my concern is not with individuals but with inequality itself. People exploiting the tax system did not create inequality. Rather, US inequality has grown for 40 years (under both Republican and Democratic Administrations and Congresses) while NO major public official has addressed it substantively. I do not cite the bishops because they are experts, but because they are not silent. I welcome other voices willing to acknowledge this chronic evil and our systemic failure to address it.

    I consider our inequality to be a national scandal, shameful, possibly criminal--and wholly unnecessary in light of our allies' relatively more just track record.

    As my context makes clear, the question "Whose side are you on?" is an invitation to side with Justice, not with any party or individual. Any "divisive" impact is the result of inequality itself, not my critique of it.

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