MONEY markets and banks have long been the target of criticism and this has intensified following the 2008 Global Financial Crisis.
Yet money and finance play an essential role in the well-being of persons and nations and they are not of themselves immoral. Relating moral principles and financial markets is the subject of a recent book titled For God and Profit: How Banking and Finance Can Serve the Common Good (Crossroad Books).
The author, Samuel Gregg, research director at the Acton Institute, has written extensively on matters of Catholic social teaching and the economy.
The financial sector is often criticized by Christians, Gregg noted in his introduction, but these judgments would be more accurate and helpful if those involved were better informed about how banking and money markets worked.
Another handicap to an accurate moral analysis of the morality of finances is that for a long time, since the late-17th century in fact as Gregg pointed out later in the book, there has been a real dearth of in-depth commentary by Christians in this area.
Gregg’s book is indeed a much-needed addition to Christian reflection on this subject. He starts with some chapters detailing the historical development of theological analysis, above all on the subject of the legitimacy of charging interest on loans.
As well as an outline of the involvement by Christians in the development of banking in the second part of the Middle Ages, Gregg also explained that it is an area in which Christians can participate with a clear conscience provided that profit realized through finance is:
+ Understood as a means to an end.
+ Never seen as an end in itself.
+ Used to serve rather than diminish what we understand as human flourishing.
In his later chapter on “Freedom, Flourishing, and Justice,” Gregg explained that the concept of human flourishing dates back to the writings of Aristotle and is understood as a person’s liberation from sin and free submission to Jesus Christ, who sets us free. As such, human freedom and flourishing are linked to doing good and avoiding evil.
Choosing to pursue wealth over the love of God is one of the ways we separate ourselves from Christ, Gregg noted. The fundamental point at stake is how money is regarded.
“For Christians, the question is how we integrate the possession and use of money into our life as Christians and, second, how money can serve the common good of all the communities in which we live, move, and have our being,” Gregg commented.
As social beings, humans are interdependent and rely on the help of others in order to flourish, and the common good is the sum of those factors that assist people to develop and perfect themselves.
Money, therefore, should be regarded as an instrumental good that helps us obtain other goods for our lives. When money comes to be considered as an end in itself or as some type of fundamental good, on the same level as life or truth, then problems occur.
When it comes to financial systems, Gregg observed that they have legitimacy to the extent they help allocate resources and stimulate economic development and contribute to the common good.
Financial systems also help to invest and distribute capital, to manage risk, and give greater flexibility in using capital to produce wealth.
Such systems, and the people using them, are never perfect and some choices by individuals or firms will be imprudent or have negative side effects. Indeed, some of the people making financial decisions will choose to do evil and to sin.
Thus, the financial speculation leading up to the 2008 crisis and the subsequent criticisms are not really anything new.
To some extent, all economic activity involves a degree of speculation, Gregg noted, insofar as it involves choices about spending and investment based on what is inevitably an imperfect knowledge of the future. The point Christians should focus on, he insisted, is whether the speculation is just or unjust
Gregg finished with a reflection on the role of Christian virtues and the idea of financial activity as a vocation to serve others. We need a financial sector influenced by men and women inspired by the gospel who know that the ultimate profit consists in building up the Kingdom of God.
The issue at question then is not about profits and financial markets as such, but about how they are used and for what they are used by people.
As Pope Francis noted in his general audience of May 18 in the parable of the rich man and Lazarus, the unnamed rich man is “condemned not because of his wealth, but for being incapable of feeling compassion for Lazarus and for not coming to his aid.” Thus, God and profits are reconcilable so long as the quest for profit is well ordered.
In addition to the historical information and the question of interest on loans, Gregg covers a variety of other topics, such as currency speculation, bank regulation and salaries in the financial sector. It can only be hoped that this illuminating book will spark off further reflections in the area of finance and morality.
©ZENIT.ORG / INNOVATIVE