The Pope on Development

[Ed.: This is a guest post by Christopher R. Dittmeier, a fellow graduate student at UNC]

Two weeks ago, Pope Benedict XVI released his latest encyclical, Caritas in Veritate (Charity in Truth), his first high-level document on social doctrine since becoming Pontiff in 2005. The theme of this encyclical is development, particularly "integral human development." While the bulk of Caritas in Veritate had been completed by 2007 (the 40th anniversary of Paul VI's treatise Populorum Progressio, which focused social doctrine away from European industrialization and toward global development issues), Pope Benedict revised it to take into account the current economic crisis. Here are a few key points from the encyclical that have bearing on IPE:

- Inequality is a systemic risk. "Through the systemic increase of social inequality, both within a single country and between the populations of different countries (i.e. the massive increase in relative poverty), not only does social cohesion suffer, thereby placing democracy at risk, but so too does the economy, through the progressive erosion of `social capital': the network of relationships of trust, dependability, and respect for rules, all of which are indispensable for any form of civil coexistence." Development, if it contributes honestly to the betterment of a state's poor, is connected to democratization, pacification, and global integration.

- Given global interdependence, getting out of the economic crisis will require not only restructuring of the market in terms of regulation, but also a rethinking of the nature of the state. "Today, as we take to heart the lessons of the current economic crisis, which sees the State's public authorities directly involved in correcting errors and malfunctions, it seems more realistic to re-evaluate their role and their powers, which need to be prudently reviewed and remodelled so as to enable them, perhaps through new forms of engagement, to address the challenges of today's world." Several important issues, including social security, labor mobility, and migration, are no longer national issues, but require transnational attention. Benedict appears to support a more vibrant interpretation of the theory of responsibility to protect, to include endowing states positive (and not only negative) humanitarian responsibilities.

- International organizations are key to the international stability and development, but current institutional arrangements lack effective agency and have strayed from their intended purpose in practice. "In the face of the unrelenting growth of global interdependence, there is a strongly felt need, even in the midst of a global recession, for a reform of the United Nations Organization, and likewise of economic institutions and international finance, so that the concept of the family of nations can acquire real teeth." The Church has for most of the twentieth century been a proponent of subsidiarity (now most well-known as the operating principle of the European Union's organization), so the proposal of investing both authority and power to supranational entities indicates skepticism of both state-centered and market-centered methods of development. The encyclical points to the role of civil society at local, national, and international levels as the primary innovators of development.

- There is no one right methodology of development. "Technologically advanced societies must not confuse their own technological development with a presumed cultural superiority, but must rather rediscover within themselves the oft-forgotten virtues which made it possible for them to flourish throughout their history." This attack on the Washington Consensus is part of Benedict's larger opposition to the ideology of technology. He specifically attacks the effects of austerity measures on social security, noting that in committing to foreign lenders, governments in developing countries often sell their own people short, weakening the long-term sustainability of their development.

- The Pope gave official blessing to microfinance. "`Ethical financing' is being developed, especially through micro-credit and, more generally, micro-finance. These processes are praiseworthy and deserve much support." Traditional banking has tended to shy away from ground-up development projects in favor of larger (and supposedly more sound) top-down projects, which are nonetheless more prone to corruption and the creation of dependency. Microfinance, on the other hand, establishes firm links between capital in developed countries and entrepreneurship in developing countries, allowing for internal capacity-building, institutionalization, and sustainable economic development.

While a Papal encyclical is unlikely to make waves in the IPE community (at least outside of Italy), the Church's position--one that transcends normal academic and partisan schools of thought--provides a fresh perspective on development theory that can prompt greater discussion on how to approach economic and political development in the 21st century.

[Ed.: For more on the encyclical, see Tyler Cowen in the WSJ. The text of the encyclical itself is here.]