The Catholic Church has for many years raised objections to the patterns of globalization, concentration of wealth and economic equality that have encouraged the massive redistribution of wealth upward that has made the rich richer, the poor poorer and the middle class more vulnerable than at any time in generations.
And, now, as the Occupy Wall Street movement raises the issue of economic inequality, the church is stepping up with a proposal to begin to address the extreme injustice of a system that taxes working people for necessities but allows speculators to avoid even the most basic responsibilities.
On the eve of the G-20 leaders, the Pontifical Council for Justice and Peace has endorsed a series of reforms to the global economic financial and monetary systems that features as its centerpiece the development of a financial transactions tax.
From the note on financial reform from the Pontifical Council:
Specific attention should be paid to the reform of the international monetary system and, in particular, the commitment to create some form of global monetary management, something that is already implicit in the Statutes of the International Monetary Fund. It is obvious that to some extent this is equivalent to putting the existing exchange systems up for discussion in order to find effective means of coordination and supervision. This process must also involve the emerging and developing countries in defining the stages of a gradual adaptation of the existing instruments.In fact, one can see an emerging requirement for a body that will carry out the functions of a kind of “central world bank” that regulates the flow and system of monetary exchanges similar to the national central banks. The underlying logic of peace, coordination and common vision which led to the Bretton Woods Agreements needs to be dusted off in order to provide adequate answers to the current questions. On the regional level, this process could begin by strengthening the existing institutions, such as the European Central Bank. However, this would require not only a reflection on the economic and financial level, but also and first of all on the political level, so as to create the set of public institutions that will guarantee the unity and consistency of the common decisions.
These measures ought to be conceived of as some of the first steps in view of a public Authority with universal jurisdiction; as a first stage in a longer effort by the global community to steer its institutions towards achieving the common good. Other stages will have to follow in which the dynamics familiar to us may become more marked, but they may also be accompanied by changes which would be useless to try to predict today. In this process, the primacy of the spiritual and of ethics needs to be restored and, with them, the primacy of politics—which is responsible for the common good—over the economy and finance. These latter need to be brought back within the boundaries of their real vocation and function, including their social function, in consideration of their obvious responsibilities to society, in order to nourish markets and financial institutions which are really at the service of the person, which are capable of responding to the needs of the common good and universal brotherhood, and which transcend all forms of economist stagnation and performative mercantilism.