Preface
As many of you may know, I’m in my senior year of my B.S. of Business Administration undergraduate program at Saint Mary’s College of CA. However, you may not know that this is my last semester and next week is my last finals week as an undergrad. You may also not know that Saint Mary’s College of CA is a Catholic college within the Lasallian order. Therefore, I’m going to take a hiatus from the Marketing Series this week to share with you my Catholic Imagination term paper I wrote on Catholic Ethics and the Spirit of Capitalism.
Introduction
Catholic Ethics had been in development for many centuries similar to Protestant Ethics. The ideals of Protestant Ethics and its effects on the Spirit of Capitalism were realized at the turn of the 20th century by Max Weber. Whereas, it had taken until the late-20th century for Michael Novak to synthesize a mutual relationship between Catholicism and the spirit of capitalism. As a result, today’s economics in America most closely resembles Protestant Ethics through the Spirit of Capitalism that fuels our entrepreneurial spirit of doing business. The American capitalist economy is based on the private ownership of businesses and their production of goods and services for profit in exchange for meeting the demand of consumers. The American economy is essentially a ‘free market’ that encourages businesses to function with limited government involvement to stimulate competition as a means for self-regulation. Unfortunately, this Spirit of Capitalism in America has resulted in poor Business ethics and a lack of Social Responsibility. Although, Novak’s The Catholic Ethic and The Spirit of Capitalism theorizes how capitalism can align with Catholicism to develop a more humane Spirit of Capitalism. Thomas Woods believed that the “Catholic influence has, until recently, all too often been obscured or overlooked in the field of modern economics and the spirit of capitalism.” (Woods p155) Therefore, this term paper will contrast the recent theory of Catholic Ethics against Protestant Ethics to see whether Catholic Ethics and their Spirit of Capitalism would more so benefit the American economy.
Responsibility
The Catholic Church’s opposition of the spirit of capitalism reached its peak when Pope Leo XIII criticized capitalism and led many to question whether Catholicism could truly align with capitalism. The first philosopher to pursue answering this question in the Catholic perspective was the Prime Minister of Italy, Amintore Fanfani. In 1935, he wrote a famous book called Catholicism, Protestantism and Capitalism. Its thesis essentially covered why Catholicism was incompatible with capitalism. Fanfani initially defined the capitalist spirit as “that attitude adopted by a man towards the problems of wealth, its acquisition and use, when he holds that wealth is simply a means for the unlimited, individualistic, and utilitarian satisfaction of all possible human needs.” (Novak p18) His beliefs represented the Catholic philosophers following the footsteps of Pope Leo XIII. In 1993, Michael Novak wrote The Catholic Ethic and Spirit of Capitalism which continues the work of Fanfani and is the spiritual successor to Max Weber’s The Protestant Ethic and Spirit of Capitalism. While Fanfani argued that Catholicism is incompatible with capitalism, Novak argued that Catholicism is compatible with capitalism; and instead of merely condemning Weber’s Spirit of Capitalism like Fanfani had done with his definition, Novak realized that wealth is not an end but a means. Novak believed that “the capitalist spirit is more intense than the tradition-cherishing preliberal spirit. It is certainly not as foreign to Catholicism as Fanfani seems to suggest. It is in fact implicit in all notions of humane economic development.” (Novak p30) Fanfani believed that capitalists developed the economy for the sake of developing the economy. However, there had always been a greater purpose of developing society by developing the economy. It’s just been more recently that businesses operate by excessive corporate greed. Therefore, Novak’s belief suggests people are individually responsible for ensuring that our means of gathering wealth meets the ends that benefits society.
Weber also had a belief that related to Novak’s emphasis of individual responsibility. Novak recognized that Weber earned “an immortal place in intellectual history because he identified something new in economic history and glimpsed its moral and religious dimensions.” (Novak p9) Weber’s realization was that the Protestant Ethic affected the Spirit of Capitalism and acknowledged the significance of morals and religion that takes place in capitalism. This is an important factor since our morals and religious affiliation are attributed to our individualism. Novak and Weber believed who we are will judge what takes place in capitalism, therefore being Catholic rather than Protestant makes a difference in how we do business. Novak understood that “the Catholic scheme, has generous ideals, which spring from the generosity of the Creator himself. Bonum est diffusivum sibi: the mark of goodness is to diffuse itself outward. As in when we hear a good story, we can hardly wait to share it with others.” (Novak p31) This belief signifies how Catholicism can be portrayed in the spirit of capitalism. When a Catholic capitalist makes a good product and enthusiastically shares the product it will sell itself. Products are sold by a perceived value that dictates how much a customer is willing to pay. Therefore in Catholic Ethics, if a company truly puts their love into developing a product then the customer will inherently love that product because that love is a gift from God. The idea that people should do work they are passionate about is the precedent of this belief and Steve Jobs is a great example. When Jobs and his team made a new product for Apple his love for his products were so strong that you couldn’t help but love his products just as much as he did. The love for these Apple devices emanated from the passion and enthusiasm that went into developing these products. We knew as consumers these devices were a gift from God because the love put in was truly unique. Novak believed that in Catholic Ethics our Spirit of Capitalism is attributed to the love capitalists put in their work and not about the vast profit margins as they’re only a means to benefit society.
Social Justice
The Spirit of Capitalism influenced by the Protestant Ethic had unfortunately resulted in inequality of the distribution of wealth, opportunity and privilege in society. Max Weber’s main attributing belief to this inequality was that “the aim of a man’s life is moneymaking and it will always be alien to anyone who is untouched by capitalism’s aura.” (Weber p12) As a result, wealth would theoretically be only for those who are privileged with the spirit of capitalism which in itself exemplifies inequality. Weber continues by saying “today’s capitalism, then, which has come to dominance in economic life, creates and trains, by means of economic selection, the economic subjects – entrepreneurs and workers – that it needs.” (Weber p13) Consequently, having the spirit of capitalism isn’t enough as economic selection continues to weed out inferior capitalists. Weber then concludes his belief by stating “capitalism demands for its growth the presence of a surplus population that it can hire cheaply on the labor market.” (Weber p17) Therefore, Weber truly believed that an inequality of the distribution of wealth, opportunity and privilege in society is essentially the byproduct of the spirit of capitalism. Even though the byproduct of the spirit of capitalism is certain, this portrayal of the capitalist encourages the misconception that capitalists are forsaken robots enduring the evil philosophy of money making for world domination. Novak concurred with the essence of my analogy as he believed the “abstract conception of the capitalist is a figment of thought; if any person in concrete life lived out such a conception, he or she would speedily be branded a fool.” (Novak p31) In Catholic Imagination, every person has good in them because we are all created by God with a purpose. So if we are truly created by God as robots programmed to fulfil a purpose, it would be to fulfill the common good of society in our own unique way that fulfills our true self.
In addition to Weber’s belief that the capitalist’s calling is to make money, he also believed that “the distribution of wealth is equally unjust but equally willed by God.” (Weber p200) This is a controversial topic of discussion today due to incredibly wealthy individuals like Warren Buffett deciding not to leave their vast fortunes to their children as inheritance. Buffett’s reason for doing so was because he believed that wealth shouldn’t be allocated by the luck of being born from the right womb. If God willed a person with such immense wealth, the wealthy person would have been blessed by the means to create such wealth like Bill Gates had been. Weber strengthened his argument by claiming that Thomas Adams said “God allows so many people to remain poor because he knows that they would be unable to resist the temptations that wealth brings with it. For all too often wealth drives religion out of a man.” (Weber p200) This belief would’ve been true if it weren’t for Christian’s belief in following the example of Jesus. According to Robert Barron, “if you want to see the perfect exemplification of the beatitudes, you should look to Christ crucified. The saint specified this observation as follows: if you want beatitude (happiness), despise what Jesus despised on the cross and love what he loved on the cross. What did he despise on the cross but the four classical addictions? The crucified Jesus was utterly detached from wealth and worldly goods.” (Barron p45) Jesus’ first addiction he detached from was wealth and by being Christian of any sect we must also detach from this addiction. Barron also claimed that “the entire purpose of the Liturgy and the church is to make saints, to make people holy.” (Barron p6) Therefore, the church believes every one of us has the will to detach from these addictions and become holy. So Adam and Weber’s belief that some are unable to resist the temptations is misleading. Anyone is able to resist the temptations of money making; hence, money making even in capitalism is only a means and not an end. If we adhere to the ideals of Catholic Ethics, the cycle of wealth distribution in America will surely decline.
Productivity
The most renowned philosophy of Protestant Ethics is the Protestant work ethic that emphasizes hard work, frugality and diligence as the constant display of a person’s salvation. But the idea of the Protestant work ethic mainly derives from Calvinism as Novak criticized Weber for “scarcely thinking of the Anglican tradition, or even the Lutheran one; because he in fact seemed to mean Calvinist or, even more precisely, Puritan”. (Novak p2) This criticism is evident through his philosophy of the Protestant ethic that “the making of money and yet more money, coupled with a strict avoidance of all uninhibited enjoyment; appears as something wholly transcendent, beyond the happiness or the benefit of the individual.” (Weber p12) This idea strongly contradicts the Catholic Imagination that emphasizes immanence and the welfare of community. It even contradicts the purpose of religion which is essentially structured to bring us happiness. Hence, substituting Protestant ethics for Catholic Ethics would remedy this selfish redemption but how would this affect the American work ethic? Weber seemed to believe that “one’s duty consists in pursuing one’s calling, and that the individual should have a commitment to his professional activity, whatever it may consist of.” (Weber p13) However, this commitment to a single profession resembles the culture of the Russian workforce rather than the American workforce. Americans can change careers throughout our entire life but Russian students are tested into specialized professional training schools that govern their careers for the rest of their lives. The Protestant Ethic may constitute a strong work ethic and high level of productivity that benefits the American economy but it isn’t a perfect fit for the way we should all do business. At the very least, we should be adopting philosophies from Protestant Ethics and Catholic Ethics that only benefit the American economy. For Catholic Ethics, the philosophy that would highly benefit the American economy is the idea of the Catholic Spirit.
The Catholic Ethic attributes most of its Catholic work ethic from the philosophy of the Catholic Spirit. Although to understand the Catholic Spirit in the context of capitalism, we must first understand the idea of the Human Spirit. The Human Spirit stems off from the root of a particular theory called the heart of capitalism which “lies in discovery, innovation, and invention. Its fundamental activity is insight into what needs to be done to provide a new good or service.” (Novak p10) This philosophy focuses on the need to develop goods and services and so it contradicts Novak’s theory that money making is a means and not an end itself. But as Novak continued to study the Spirit of Democratic Capitalism, he realized the downfall of the Human Spirit by understanding the corruption in the American economy. Novak discovered that “the economic system depends upon a sense of duty, disciplined innovation, and savings, but it also emits siren calls of pleasure. Productivity falls; debts grow; inflation roars; the system stagnates. In this sense, the new phenomenon encountered by economists – ‘stagflation’ – is at bottom a disease of the spirit, which silently spreads decay even when unobserved by economic indicators.” (Novak p32) Therefore, Novak proposed that we should align our Human Spirit towards the Catholic Spirit that acts on the benevolence of others instead of our own needs and pleasures. Novak’s theory developed from Fanfani’s belief that the Catholic Spirit’s main idea of importance “leads directly to a social conception of the use of wealth, that is, to a correlation of the satisfaction of a man’s own needs with the satisfaction of those of his neighbor.” (Fanfani p56) This use of wealth corrects the heart of capitalism toward the principle to love thy neighbor as thyself. Ergo, we must only create wealth as a means to satisfy the needs of our neighbor to benefit the structure of society. If the American economy adopted the Catholic Spirit then we would sustain the needs of the people which combines Novak’s philosophy of the Spirit of the Democratic Capitalism with his latter philosophy of the Catholic Ethic and Spirit of Capitalism.
Liberty
The second most renowned philosophy of Protestant Ethics is the idea of the iron cage. Weber believed that “concern for outward possessions should sit lightly on the shoulders of his saints like a thin cloak which can be thrown off at any time. But fate decreed that the cloak should become a shell as hard as steel. As asceticism began to change the world and endeavored to exercise its influence over it, the outward goods of this world gained increasing and finally inescapable power over men.” (Weber p121) Thus, the idea of the iron cage limits the will of the capitalist toward materialism. The iron cage conflicts the work satisfaction offered through proper business ethics and social responsible practices or the love of one’s profession offered through Catholic Ethics. Therefore, Protestant Ethics outweigh the alternative ideas of the spirit of capitalism. Being a democratic American, Novak believed in “the three systems of liberty. Social justice requires for its full exercise the institutional supports of three independent, yet interdependent systems. Without the protection of civil and political rights; without the institutions of private property, markets, incentives, and the social supports required for the exercise of personal initiative, enterprise, and discovery; and without the institutions of religious, intellectual, and cultural liberty – without all these, the exercise of social justice would be severely restricted. The preconditions for the full practice of social justice are systemic and institutional. They require radical separation of powers among three types of authority.” (Weber p81) In this particular case, Protestant Ethics, Catholic Ethics, and Business Ethics create their own three systems of liberty for practicing capitalism. The three styles must all be considered toward developing the most balanced way of doing socially responsible business practices. With these three systems of liberty, neither systems of ethics will outweigh one another and will prevent philosophies like the iron cage from limiting our perception of capitalism.
Robert Barron taught us that the biblical sense of freedom is the “freedom of excellence. Freedom is not primarily a choice, but rather the shaping of desire so as to make the achievement of the good first possible and then effortless.” (Barron p40) This is similar to Novak’s philosophy of liberty that “progress and economic growth – not only personal but for the entire world – were seen to be the will of God. Progress imposed its disciplines, be full of promise for science, the arts, religion, and even the humble comforts of human life. To be a good Christian and to evince the highest of civic virtues would be, simultaneously, to labor for human progress.” (Novak p40) Initially Catholics resisted progress, but since the Counter Reformation to the Protestant Reformation, Catholics are becoming more in favor of progress for the benefit of the world. Although, this progress must be the means and not the end itself. In order to benefit society by doing business, we must inherently long for our actions to benefit society. Novak’s main philosophy of liberty is that “the Christian notion of conscience imperatively demands a corresponding measure of personal liberty. The feeling of duty and responsibility to God is the only arbiter of a Christian’s actions. With this no human authority can be permitted to interfere. We are bound to extend to the utmost, and to guard from every encroachment, the sphere in which we can act in obedience to the sole voice of conscience, regardless of any other consideration.” (Novak p94) This concept of personal liberty is an essential foundation to Catholicism. Catholics act through God’s example set by the teachings of Jesus. When we hear our conscience govern our actions as either right or wrong that is God’s will flowing through us. Even though we do have the choice to act by our conscience, Catholics have a duty to follow this responsibility to God. Therefore, to practice Catholic Ethics we aren’t simply doing business for the benefit of society alone; but instead, benefiting society is the overall picture and our duty is to make the right ethical decisions that leads to the path of benefiting society and God’s creation.
Conclusion
Weber saw the distinct differences between Protestant and Catholic to be like the popular saying “either eat well or sleep soundly. In the above case, the Protestant likes to eat well, while the Catholic wants to sleep soundly.” (Weber p5) However, the Protestant Ethic doesn’t work alone in Business because of the detrimental consequences stricken by the ethics of Protestants. Francis Bacon is the best example of Protestant Ethics and its adverse effect on economics. Bacon’s mother was an orthodox protestant and raised Bacon with the influence of Calvinism. As a result, Bacon interpreted the bible’s story of creation as an ends for our dominion over the earth. The bible states “let them have dominion over the fish of the sea and over the birds of the heavens and over the livestock and over all the earth and over every creeping thing that creeps on the earth.” (Genesis 1-26) Bacon interpreted the act of dominion literally which began the act of poor business ethics and socially irresponsible practices like deforestation by industrialization. However, just because Protestant Ethics led to poor business ethics and social irresponsibility doesn’t mean Protestant Ethics are to blame and must be removed from economics. Novak had come to a reasonable conclusion, “a vision of how the Catholic ethic may undergird, correct, and enlarge the spirit of capitalism. To be in favor of capitalism, or to make it work well, one need not be a partisan of the Protestant ethic in a narrow sense.” (Novak p11) Novak believed that the Catholic Ethic is meant to evolve the spirit of capitalism into a more humane capitalistic spirit. We learned in Catholic Imagination, that Catholicism and Protestantism are meant to be diverse in order to correct its counterpart. This is the same relation with Catholic and Protestant Ethics. Protestant Ethics is the ubiquitous standard of capitalism, therefore we must adopt towards a more Catholic Ethic perspective to balance out the spirit of capitalism. Hence, there isn’t a coherent winner between Catholic and Protestant Ethics but they are instead interdependent.
Works Cited
Barron, Robert. Catholicism: A Journey to the Heart of the Faith. Image Books, 2011. Print.
Fanfani, Amintore. Catholicism, Protestantism, and Capitalism. IHS, 2003. Print.
Novak, Michael. The Catholic Ethic and the Spirit of Capitalism. Free, 1993. Print.
Novak, Michael. The spirit of democratic capitalism. Simon and Schuster, 1982. Print.
Weber, Max. The Protestant Ethic and the Spirit of Capitalism. Scribner, 1958. Print.
Woods, Thomas. How the Catholic Church Built Western Civilization. Regnery, 2005. Print.
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