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Full English Text: Note on financial reform from the Pontifical Council for Justice and Peace

Please find, below, an unofficial translation of the Note on the reform of the international financial and monetary systems in the context of global public authority, released Monday by the Pontifical Council for Justice and Peace.

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Pontifical Council for Justice and Peace

TOWARDS REFORMING
THE INTERNATIONAL FINANCIAL AND MONETARY SYSTEMS
IN THE CONTEXT OF GLOBAL PUBLIC AUTHORITY

Vatican City
2011

Table of Contents

Preface

Presupposition

      Economic Development and Inequalities
      The Role of Technology and the Ethical Challenge
      An Authority over Globalization
      Towards Reforming the International Financial and Monetary Systems in a way that Responds to the Needs of all Peoples

Conclusions

Preface

“The world situation requires the concerted effort of everyone, a thorough examination of every facet of the problem – social, economic, cultural and spiritual. The Church, which has long experience in human affairs and has no desire to be involved in the political activities of any nation, ‘seeks but one goal: to carry forward the work of Christ under the lead of the befriending Spirit. And Christ entered this world to give witness to the truth; to save, not to judge; to serve, not to be served.’”
With these words, in the prophetic and always relevant Encyclical Populorum Progressio of 1967, Paul VI outlined in a clear way “the trajectories” of the Church’s close relation with the world. These trajectories intersect in the profound value of human dignity and the quest for the common good, which make people responsible and free to act according to their highest aspirations.
The economic and financial crisis which the world is going through calls everyone, individuals and peoples, to examine in depth the principles and the cultural and moral values at the basis of social coexistence. What is more, the crisis engages private actors and competent public authorities on the national, regional and international level in serious reflection on both causes and solutions of a political, economic and technical nature.
In this perspective, as Benedict XVI teaches, the crisis “obliges us to re-plan our journey, to set ourselves new rules and to discover new forms of commitment, to build on positive experiences and to reject negative ones. The crisis thus becomes an opportunity for discernment, in which to shape a new vision for the future. In this spirit, with confidence rather than resignation, it is appropriate to address the difficulties of the present time.”
The G20 leaders themselves said in the Statement they adopted in Pittsburgh in 2009: “The economic crisis demonstrates the importance of ushering in a new era of sustainable global economic activity grounded in responsibility.”
The Pontifical Council for Justice and Peace now responds to the Holy Father’s appeal, while making the concerns of everyone our own, especially the concerns of those who pay most dearly for the current situation. With due respect for the competent civil and political authorities, the Council hereby offers and shares its reflection: Towards reforming the international financial and monetary systems in the context of global public authority.
This reflection hopes to benefit world leaders and all people of good will. It is an exercise of responsibility not only towards the current but above all towards future generations, so that hope for a better future and confidence in human dignity and capacity for good may never be extinguished.
Cardinal Peter K.A. Turkson +Mario Toso
President Secretary

Presupposition

Every individual and every community shares in and is responsible for promoting the common good. Faithful to their ethical and religious vocation, communities of believers should take the lead in asking whether human family has adequate means at its disposal to achieve the global common good. The Church for her part is called to encourage in everyone without distinction, the desire to join in the “monumental amount of individual and collective effort” which men have made “throughout the course of the centuries … to better the circumstances of their lives…. [T]his human activity accords with God’s will.”

1. Economic Development and Inequalities

The grave economic and financial crisis which the world is going through today springs from multiple causes. Opinions on the number and significance of these causes vary widely. Some commentators emphasize first and foremost certain errors inherent in the economic and financial policies; others stress the structural weaknesses of political, economic and financial institutions; still others say that the causes are ethical breakdowns occurring at all levels of a world economy that is increasingly dominated by utilitarianism and materialism. At every stage of the crisis, one might discover particular technical errors intertwined with certain ethical orientations.

In material goods markets, natural factors and productive capacity as well as labour in all of its many forms set quantitative limits by determining relationships of costs and prices which, under certain conditions, permit an efficient allocation of available resources.

In monetary and financial markets, however, the dynamics are quite different. In recent decades, it was the banks that extended credit, which generated money, which in turn sought a further expansion of credit. In this way, the economic system was driven towards an inflationary spiral that inevitably encountered a limit in the risk that credit institutions could accept. They faced the ultimate danger of bankruptcy, with negative consequences for the entire economic and financial system

After World War II, national economies made progress, albeit with enormous sacrifices for millions, indeed billions of people who, as producers and entrepreneurs on the one hand and as savers and consumers on the other, had put their confidence in a regular and progressive expansion of money supply and investment in line with opportunities for real growth of the economy.

Since the 1990s, we have seen that money and credit instruments worldwide have grown more rapidly than revenue, even adjusting for current prices. From this came the formation of pockets of excessive liquidity and speculative bubbles which later turned into a series of solvency and confidence crises that have spread and followed one another over the years.

A first crisis took place in the 1970s until the early 1980s and was related to the sudden sharp rises in oil prices. Subsequently, there was a series of crises in the developing world, for example, the first crisis in Mexico in the 1980s and those in Brazil, Russia and Korea, and then again in Mexico in the 1990s as well as in Thailand and Argentina.

The speculative bubble in real estate and the recent financial crisis have the very same origin in the excessive amount of money and the plethora of financial instruments globally.

Whereas the crises in the developing countries that risked involving the global monetary and financial system were contained through interventions by the more developed countries, the outbreak of the crisis in 2008 was characterized by a different factor compared with the previous ones, something decisive and explosive. Generated in the context of the United States, it took place in one of the most important zones for the global economy and finances. It directly affected what is still the currency of reference for the great majority of international trade transactions.

A liberalist approach, unsympathetic towards public intervention in the markets, chose to allow an important international financial institution to fall into bankruptcy, on the assumption that this would contain the crisis and its effects. Unfortunately, this spawned a widespread lack of confidence and a sudden change in attitudes. Various public interventions of enormous scope (more than 20% of gross national product) were urgently requested in order to stem the negative effects that could have overwhelmed the entire international financial system.

The consequences for the real economy, what with grave difficulties in some sectors – first of all, construction – and wide distribution of unfavourable forecasts, have generated a negative trend in production and international trade with very serious repercussions for employment as well as other effects that have probably not yet had their full impact. The costs are extremely onerous for millions in the developed countries, but also and above all for billions in the developing ones.

In countries and areas where the most elementary goods like health, food and shelter are still lacking, more than a billion people are forced to survive on an average income of less than a dollar a day.

Global economic well-being, traditionally measured by national income and also by levels of capacities, grew during the second half of the twentieth century, to an extent and with a speed never experienced in the history of humankind.

But the inequalities within and between various countries have also grown significantly. While some of the more industrialized and developed countries and economic zones – the ones that are most industrialized and developed – have seen their income grow considerably, other countries have in fact been excluded from the overall improvement of the economy and their situation has even worsened.

After the Second Vatican Council in his Encyclical Letter Populorum Progressio of 1967, Paul VI already clearly and prophetically denounced the dangers of an economic development conceived in liberalist terms because of its harmful consequences for world equilibrium and peace. The Pontiff asserted that the defence of life and the promotion of people’s cultural and moral development are the essential conditions for the promotion of authentic development. On these grounds, Paul VI said that full and global development is “the new name of peace”.

Forty years later, in its annual Report of in 2007, the International Monetary Fund recognized the close connection between an inadequately managed process of globalization on the one hand, and the world’s great inequalities on the other. Today the modern means of communication make these great economic, social and cultural inequalities obvious to everyone, rich and poor alike, giving rise to tensions and to massive migratory movements.

Nonetheless, it should be reiterated that the process of globalisation with its positive aspects is at the root of the world economy’s great development in the twentieth century. It is worth recalling that between 1900 and 2000 the world population increased almost fourfold and the wealth produced worldwide grew much more rapidly, resulting in a significant rise of average per capita income. At the same time, however, the distribution of wealth did not become fairer but in many cases worsened.

What has driven the world in such a problematic direction for its economy and also for peace?

First and foremost, an economic liberalism that spurns rules and controls. Economic liberalism is a theoretical system of thought, a form of “economic apriorism” that purports to derive laws for how markets function from theory, these being laws of capitalistic development, while exaggerating certain aspects of markets. An economic system of thought that sets down a priori the laws of market functioning and economic development, without measuring them against reality, runs the risk of becoming an instrument subordinated to the interests of the countries that effectively enjoy a position of economic and financial advantage.

Regulations and controls, imperfect though they may be, already often exist at the national and regional levels; whereas on the international level, it is hard to apply and consolidate such controls and rules.

The inequalities and distortions of capitalist development are often an expression not only of economic liberalism but also of utilitarian thinking: that is, theoretical and practical approaches according to which what is useful for the individual leads to the good of the community. This saying has a core of truth, but it cannot be ignored that individual utility – even where it is legitimate – does not always favour the common good. In many cases a spirit of solidarity is called for that transcends personal utility for the good of the community.

In the 1920s, some economists had already warned about giving too much weight, in the absence of regulations and controls, to theories which have since become prevailing ideologies and practices on the international level.

One devastating effect of these ideologies, especially in the last decades of the past century and the first years of the current one, has been the outbreak of the crisis in which the world is still immersed.

In his social encyclical, Benedict XVI precisely identified the roots of a crisis that is not only economic and financial but above all moral in nature. In fact, as the Pontiff notes, to function correctly the economy needs ethics; and not just of any kind but one that is people-centred. He goes on to denounce the role played by utilitarianism and individualism and the responsibilities of those who have adopted and promoted them as the parameters for the optimal behaviour of all economic and political agents who operate and interact in the social context. But Benedict XVI also identifies and denounces a new ideology, that of “technocracy”.

2. The Role of Technology and the Ethical Challenge

The great economic and social development of the past century, with their bright spots and serious shadows, can also be attributed in large part to the continued development of technology and more recently to advances in information technologies and especially their applications in the economy and most significantly in finance.

However, to interpret the current new social question lucidly, we must avoid the error – itself a product of neo-liberal thinking – that would consider all the problems that need tackling to be exclusively of a technical nature. In such a guise, they evade the needed discernment and ethical evaluation. In this context Benedict XVI’s encyclical warns about the dangers of the technocracy ideology: that is, of making technology absolute, which “tends to prevent people from recognizing anything that cannot be explained in terms of matter alone” and minimizing the value of the choices made by the concrete human individual who works in the economic-financial system by reducing them to mere technical variables. Being closed to a “beyond” in the sense of something more than technology, not only makes it impossible to find adequate solutions to the problems, but it impoverishes the principal victims of the crisis more and more from the material standpoint.

In the context of the complexity of the phenomena, the importance of the ethical and cultural factors cannot be overlooked or underestimated. In fact, the crisis has revealed behaviours like selfishness, collective greed and the hoarding of goods on a great scale. No one can be content with seeing man live like “a wolf to his fellow man”, according to the concept expounded by Hobbes. No one can in conscience accept the development of some countries to the detriment of others. If no solutions are found to the various forms of injustice, the negative effects that will follow on the social, political and economic level will be destined to create a climate of growing hostility and even violence, and ultimately undermine the very foundations of democratic institutions, even the ones considered most solid.

Recognizing the primacy of being over having and of ethics over the economy, the world’s peoples ought to adopt an ethic of solidarity as the animating core of their action. This implies abandoning all forms of petty selfishness and embracing the logic of the global common good which transcends merely contingent, particular interests. In a word, they ought to have a keen sense of belonging to the human family which means sharing the common dignity of all human beings: “Even prior to the logic of a fair exchange of goods and the forms of justice appropriate to it, there exists something which is due to man because he is man, by reason of his lofty dignity.”

In 1991, after the failure of Marxist communism, Blessed John Paul II had already warned of the risk of an “idolatry of the market, an idolatry which ignores the existence of goods which by their nature are not and cannot be mere commodities.” Today his warning needs to be heeded without delay and a road must be taken that is in greater harmony with the dignity and transcendent vocation of the person and the human family.
3. An Authority over Globalization

On the way to building a more fraternal and just human family and, even before that, a new humanism open to transcendence, Blessed John XXIII’s teaching seems especially timely. In the prophetic Encyclical Pacem in Terris of 1963, he observed that the world was heading towards ever greater unification. He then acknowledged the fact that a correspondence was lacking in the human community between the political organization “on a world level and the objective needs of the universal common good”. He also expressed the hope that one day “a true world political authority” would be created.

In view of the unification of the world engendered by the complex phenomenon of globalization, and of the importance of guaranteeing, in addition to other collective goods, the good of a free, stable world economic and financial system at the service of the real economy, today the teaching of Pacem in Terris appears to be even more vital and worthy of urgent implementation.

In the same spirit of Pacem in Terris, Benedict XVI himself expressed the need to create a world political authority. This seems obvious if we consider the fact that the agenda of questions to be dealt with globally is becoming ever longer. Think, for example, of peace and security; disarmament and arms control; promotion and protection of fundamental human rights; management of the economy and development policies; management of the migratory flows and food security, and protection of the environment. In all these areas, the growing interdependence between States and regions of the world becomes more and more obvious as well as the need for answers that are not just sectorial and isolated, but systematic and integrated, rich in solidarity and subsidiarity and geared to the universal common good.

As the Pope reminds us, if this road is not followed, “despite the great progress accomplished in various sectors, international law would risk being conditioned by the balance of power among the strongest nations.”

The purpose of the public authority, as John XXIII recalled in Pacem in Terris, is first and foremost to serve the common good. Therefore, it should be endowed with structures and adequate, effective mechanisms equal to its mission and the expectations placed in it. This is especially true in a globalized world which makes individuals and peoples increasingly interconnected and interdependent, but which also reveals the existence of monetary and financial markets of a predominantly speculative sort that are harmful for the real economy, especially of the weaker countries.

This is a complex and delicate process. A supranational Authority of this kind should have a realistic structure and be set up gradually. It should be favourable to the existence of efficient and effective monetary and financial systems; that is, free and stable markets overseen by a suitable legal framework, well-functioning in support of sustainable development and social progress of all, and inspired by the values of charity and truth. It is a matter of an Authority with a global reach that cannot be imposed by force, coercion or violence, but should be the outcome of a free and shared agreement and a reflection of the permanent and historic needs of the world common good. It ought to arise from a process of progressive maturation of consciences and freedoms as well as the awareness of growing responsibilities. Consequently, reciprocal trust, autonomy and participation cannot be overlooked as if they were superfluous elements. The consent should involve an ever greater number of countries that adhere with conviction, through a sincere dialogue that values the minority opinions rather than marginalizing them. So the world Authority should consistently involve all peoples in a collaboration in which they are called to contribute, bringing to it the heritage of their virtues and their civilizations.

The establishment of a world political Authority should be preceded by a preliminary phase of consultation from which a legitimated institution will emerge that is in a position to be an effective guide and, at the same time, can allow each country to express and pursue its own particular good. The exercise of this Authority at the service of the good of each and every one will necessarily be super partes (impartial): that is, above any partial vision or particular good, in view of achieving the common good. Its decisions should not be the result of the more developed countries’ excessive power over the weaker countries. Instead, they should be made in the interest of all, not only to the advantage of some groups, whether they are formed by private lobbies or national governments.

A supranational Institution, the expression of a “community of nations”, will not last long, however, if the countries’ diversities from the standpoint of cultures, material and immaterial resources and historic and geographic conditions, are not recognized and fully respected. The lack of a convinced consensus, nourished by an unceasing moral communion on the part of the world community, would also reduce the effectiveness of such an Authority.

What is valid on the national level is also valid on the global level. A person is not made to serve authority unconditionally. Rather, it is the task of authority to be at the service of the person, consistent with the pre-eminent value of human dignity. Likewise, governments should not serve the world Authority unconditionally. Instead, it is the world Authority that should put itself at the service of the various member countries, according to the principle of subsidiarity. Among the ways it should do this is by creating the socio-economic, political and legal conditions essential for the existence of markets that are efficient and efficacious because they are not over-protected by paternalistic national policies and not weakened by systematic deficits in public finances and of the gross national products – indeed, such policies and deficits actually hamper the markets themselves in operating in a world context as open and competitive institutions.

In the tradition of the Church’s Magisterium which Benedict XVI has vigorously embraced, the principle of subsidiarity should regulate relations between the State and local communities and between public and private institutions, not excluding the monetary and financial institutions. So, on a higher level, it ought to govern the relations between a possible future global public Authority and regional and national institutions. This principle guarantees both democratic legitimacy and the efficacy of the decisions of those called to make them. It allows respect for the freedom of people, individually and in communities, and at the same time, allows them to take responsibility for the objectives and duties that pertain to them.

According to the logic of subsidiarity, the higher Authority offers its subsidium, that is, its aid, only when individual, social or financial actors are intrinsically deficient in capacity, or cannot manage by themselves to do what is required of them. Thanks to the principle of solidarity, a lasting and fruitful relation is built up between global civil society and a world public Authority as States, intermediate bodies, various institutions – including economic and financial ones – and citizens make their decisions with a view to the global common good, which transcends national goods.
As we read in Caritas in Veritate, “The governance of globalization must be marked by subsidiarity, articulated into several layers and involving different levels that can work together.” Only in this way can the danger of a central Authority’s bureaucratic isolation be avoided, which would otherwise risk being delegitimized by an excessive distance from the realities on which it is based and easily fall prey to paternalistic, technocratic or hegemonic temptations.

However, a long road still needs to be travelled before arriving at the creation of a public Authority with universal jurisdiction. It would seem logical for the reform process to proceed with the United Nations as its reference because of the worldwide scope of its responsibilities, its ability to bring together the nations of the world, and the diversity of its tasks and those of its specialized Agencies. The fruit of such reforms ought to be a greater ability to adopt policies and choices that are binding because they are aimed at achieving the common good on the local, regional and world levels. Among the policies, those regarding global social justice seem most urgent: financial and monetary policies that will not damage the weakest countries; and policies aimed at achieving free and stable markets and a fair distribution of world wealth, which may also derive from unprecedented forms of global fiscal solidarity, which will be dealt with later.

On the way to creating a world political Authority, questions of governance (that is, a system of merely horizontal coordination without an authority super partes cannot be separated from those of a shared government (that is, a system which in addition to horizontal coordination establishes an authority super partes) which is functional and proportionate to the gradual development of a global political society. The establishment of a global political Authority cannot be achieved without an already functioning multilateralism, not only on a diplomatic level, but also and above all in relation to programs for sustainable development and peace. It is not possible to arrive at global Government without giving political expression to pre-existing forms of interdependence and cooperation.

4. Towards Reforming the International Financial and Monetary Systems in a way that Responds to the Needs of all Peoples

In economic and financial matters, the most significant difficulties come from the lack of an effective set of structures that can guarantee, in addition to a system of governance, a system of government for the economy and international finance.

What can be said about this prospect? What steps can be taken concretely?

With regard to the current global economic and financial systems, two decisive factors should be stressed. The first is the gradual decline in efficacy of the Bretton Woods institutions beginning in the early 1970s. In particular, the International Monetary Fund has lost an essential element for stabilizing world finance, that of regulating the overall money supply and vigilance over the amount of credit risk taken on by the system. To sum it up, stabilizing the world monetary system is no longer a “universal public good” within its reach.

The second factor is the need for a minimum, shared body of rules to manage the global financial market which has grown much more rapidly than the real economy. This situation of rapid, uneven growth has come about, on the one hand, because of the overall abrogation of controls on capital movements and the tendency to deregulate banking and financial activities; and on the other, because of advances in financial technology, due largely to information technology.

On the structural level, in the latter part of the last century, monetary and financial activities worldwide grew much more rapidly than the production of goods and services. In this context, the quality of credit tended to decrease to the point that it exposed the credit institutions to more risk than was reasonably sustainable. It is sufficient to look at the fate of large and small credit institutions during the crises that broke out in the 1980s and 1990s, and finally in the 2008 crisis.
Again in the last part of the twentieth century, there was a growing tendency to define the strategic directions of economic and financial policy in terms of ‘clubs’ and of larger or smaller groups of more developed countries. While not denying the positive aspects of this approach, it is impossible to overlook that it did not appear to respect the representative principle fully, in particular of the less developed or emerging countries.

The need to heed the voices of a greater number of countries has led to expanding the relevant groups; for instance, there is now a G20 where there was once just a G7. This has been a positive development because it became possible to include developing and emerging countries with larger populations in shaping the economy and global finance.

In the area of the G20, concrete tendencies can thus mature which, when worked out properly in the appropriate technical centres, will be able to guide the competent bodies on the national and regional level towards consolidating existing institutions and creating new ones with appropriate and effective instruments on the international level.
Moreover, the G20 leaders themselves said in their final Statement in Pittsburgh 2009: “The economic crisis demonstrates the importance of ushering in a new era of sustainable global economic activity grounded in responsibility”. To tackle the crisis and open up a new era “of responsibility”, in addition to technical and short-term measures, the leaders put forth the proposal “to reform the global architecture to meet the needs of the 21st century,” and later the proposal “to launch a framework that lays out the policies and the way we act together to generate strong, sustainable and balanced global growth”.

Therefore, a process of reflection and reforms needs to be launched that will explore creative and realistic avenues for taking advantage of the positive aspects of already existing forums.
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.

On the basis of this sort of ethical approach, it seems advisable to reflect, for example, on:
a) taxation measures on financial transactions through fair but modulated rates with charges proportionate to the complexity of the operations, especially those made on the “secondary” market. Such taxation would be very useful in promoting global development and sustainability according to the principles of social justice and solidarity. It could also contribute to the creation of a world reserve fund to support the economies of the countries hit by crisis as well as the recovery of their monetary and financial system;
b) forms of recapitalization of banks with public funds making the support conditional on “virtuous” behaviours aimed at developing the “real economy”;
c) the definition of the domains of ordinary credit and of Investment Banking. This distinction would allow a more effective management of the “shadow markets” which have no controls and limits.
It is sensible and realistic to allow the necessary time to build up broad consensuses, but the goal of the universal common good with its inescapable demands is waiting on the horizon. Moreover, it is hoped that those in universities and other institutions who educate tomorrow’s leadership will work hard to prepare them for their responsibilities to discern the global public good and serve it in a constantly changing world. The gap between ethical training and technical preparation needs to be filled by highlighting in a particular way the inescapable synergy between the two levels of practical doing (praxis) and of boundless human striving (poièsis).

The same effort is required from all those who are in a position to enlighten world public opinion in order to help it to brave this new world, no longer with anxiety but in hope and solidarity.

Conclusions

Under the current uncertainties, in a society capable of mobilizing immense means but whose cultural and moral reflection is still inadequate with regard to their use in achieving the appropriate ends, we are invited to not give in and to build above all a meaningful future for the generations to come. We should not be afraid to propose new ideas, even if they might destabilize pre-existing balances of power that prevail over the weakest. They are a seed thrown to the ground that will sprout and hurry towards bearing fruit.

As Benedict XVI exhorts us, agents on all levels – social, political, economic, professional – are urgently needed who have the courage to serve and to promote the common good through an upright life. Only they will succeed in living and seeing beyond the appearances of things and perceiving the gap between existing reality and untried possibilities.

Paul VI emphasized the revolutionary power of “forward-looking imagination” that can perceive the possibilities inscribed in the present and guide people towards a new future. By freeing his imagination, man frees his existence. Through an effort of community imagination, it is possible to transform not only institutions but also lifestyles and encourage a better future for all peoples.
Modern States became structured wholes over time and reinforced sovereignty within their own territory. But social, cultural and political conditions have gradually changed. Their interdependence has grown – so it has become natural to think of an international community that is integrated and increasingly ruled by a shared system – but a worse form of nationalism has lingered on, according to which the State feels it can achieve the good of its own citizens in a self-sufficient way.

Today all of this seems anachronistic and surreal, and all the nations, great or small, together with their governments, are called to go beyond the “state of nature” which would keep States in a never-ending struggle with one another. Globalization, despite some of its negative aspects, is unifying peoples more and prompting them to move towards a new “rule of law” on the supranational level, supported by a more intense and fruitful collaboration. With dynamics similar to those that put an end in the past to the “anarchical” struggle between rival clans and kingdoms with regard to the creation of national states, today humanity needs to be committed to the transition from a situation of archaic struggles between national entities, to a new model of a more cohesive, polyarchic international society that respects every people’s identity within the multifaceted riches of a single humanity. Such a passage, which is already timidly under way, would ensure the citizens of all countries – regardless of their size or power – peace and security, development, and free, stable and transparent markets. As John Paul II warns us, “Just as the time has finally come when in individual States a system of private vendetta and reprisal has given way to the rule of law, so too a similar step forward is now urgently needed in the international community.”

Time has come to conceive of institutions with universal competence, now that vital goods shared by the entire human family are at stake, goods which the individual States cannot promote and protect by themselves.

So conditions exist for definitively going beyond a ‘Westphalian’ international order in which the States feel the need for cooperation but do not seize the opportunity to integrate their respective sovereignties for the common good of peoples.

It is the task of today’s generation to recognize and consciously to accept these new world dynamics for the achievement of a universal common good. Of course, this transformation will be made at the cost of a gradual, balanced transfer of a part of each nation’s powers to a world Authority and to regional Authorities, but this is necessary at a time when the dynamism of human society and the economy and the progress of technology are transcending borders, which are in fact already very eroded in a globalized world.

The birth of a new society and the building of new institutions with a universal vocation and competence are a prerogative and a duty for everyone, with no distinction. What is at stake is the common good of humanity and the future itself.

In this context, for every Christian there is a special call of the Spirit to become committed decisively and generously so that the many dynamics under way will be channelled towards prospects of fraternity and the common good. An immense amount of work is to be done towards the integral development of peoples and of every person. As the Fathers said at the Second Vatican Council, this is a mission that is both social and spiritual, which “ to the extent that the former can contribute to the better ordering of human society, it is of vital concern to the Kingdom of God.”
In a world on its way to rapid globalization, the reference to a world Authority becomes the only horizon compatible with the new realities of our time and the needs of humankind. However, it should not be forgotten that this development, given wounded human nature, will not come about without anguish and suffering.

Through the account of the Tower of Babel (Genesis 11:1-9), the Bible warns us how the “diversity” of peoples can turn into a vehicle for selfishness and an instrument of division. In humanity there is a real risk that peoples will end up not understanding each other and that cultural diversities will lead to irremediable oppositions. The image of the Tower of Babel also warns us that we must avoid a “unity” that is only apparent, where selfishness and divisions endure because the foundations of the society are not stable. In both cases, Babel is the image of what peoples and individuals can become when they do not recognize their intrinsic transcendent dignity and brotherhood.

The spirit of Babel is the antithesis of the Spirit of Pentecost (Acts 2:1-12), of God’s design for the whole of humanity: that is, unity in truth. Only a spirit of concord that rises above divisions and conflicts will allow humanity to be authentically one family and to conceive of a new world with the creation of a world public Authority at the service of the common good.

“without calculation or personal gain” — Father Damien of Malakai

No feeling in his foot

By Fr. Joseph Briody

Josef De Veuster, best known as the Leper Priest, was born on 3 January 1840 in Belgium. Entering the Congregation of the Sacred Hearts of Jesus and Mary in Leuven, he took the name Damien.

Though clever, he was considered unsuitable for the priesthood because he lacked education. But he learned Latin from his brother and it was agreed he would be ordained.

During his studies he prayed daily before the image of St Francis Xavier, patron saint of the foreign missions, to be sent on the missions. When his brother Auguste could not travel to Hawaii as a missionary because of illness, Damien went in his place.

On 19 March 1864 he landed in Honolulu. A few weeks later he was ordained a priest and assigned to the mission on the island of Hawaii.

At the time Hawaii had major health problems. The people were contracting diseases introduced by foreign traders and sailors. Thousands died of �flu, syphilis and other diseases new to them, including leprosy, for which there was no known cure.

In 1865 Hawaii issued the “Act to Prevent the Spread of Leprosy”. The lepers were to be quarantined. Between 1866 and 1969 over 8,000 people were sent to Molokai on the Kalaupapa peninsula. They were provided with food but no proper healthcare.

The local bishop realised that a priest was needed to care for the lepers. But such an appointment could be a death sentence and he did not wish to instruct any priest to go there.

 was the first to volunteer and on 10 May 1873 he arrived on Molokai. His first act was to build a church and establish the Parish of St Philomena.

He devoted himself to the spiritual needs of his people as well as nursing, building homes, making coffins and digging graves. He wrote to his brother, rewording St Paul: “I make myself a leper with the lepers to gain all to Jesus Christ.”

Under Damien�s leadership the life of the lepers improved. At his own request he remained on Molokai, escaping the disease for 12 years.

But one evening as he bathed his feet in boiling water he noticed he had no feeling in his right foot. It was the first sign. At next Sunday�s Mass he began his homily: “We lepers…” The news was flashed around the world.

Fr Damien died of leprosy on 15 April 1889, aged 49. He was buried under the same tree where he first slept on his arrival on Molokai. In January 1936 his body was moved to Leuven at the request of the Belgian government.

In August 1889 a Honolulu Presbyterian minister, Rev C. M. Hyde criticised his work, referring to him as “a coarse, dirty man” whose leprosy could be put down to “carelessness.”

One person who strongly defended Fr Damien was Robert Louis Stevenson, himself a Presbyterian, the author of Treasure Island, Kidnapped and Dr Jekyll and Mr Hyde.

In 1890 Stevenson stayed on Molokai for 8 days. He vigorously defended the heroic virtues of Fr Damien. He proved correct. On 11 October 2009 Damien was canonised in Rome along with Jeanne Jugan, foundress of the Little Sisters of the Poor.

Mahatma Gandhi also defended the priest�s name. Gandhi claimed Fr Damien was an inspiration for his social campaigns in India. Gandhi said:

“The political and journalistic world can boast of very few heroes who compare with Fr Damien of Molokai. It is worthwhile to look for the sources of such heroism.”

Of course the source was Damien�s faith in Christ and the charity flowing from that. At the canonisation Pope Benedict said that the new saints had given themselves “without calculation or personal gain. Their perfection… consists in no longer placing themselves at the centre, but choosing to go against the flow and live according to the Gospel.”

SOURCE: ALIVE!

Pope Benedict XVI’s State of the World Address – Full Text

Monday, 7 January 2008jj2.jpg

Your Excellencies, Ladies and Gentlemen,

1. I extend cordial greetings to your Dean, Ambassador Giovanni Galassi, and I thank him for the kind words that he has addressed to me in the name of the Diplomatic Corps accredited to the Holy See. To each of you I offer respectful greetings, particularly to those who are present at this meeting for the first time. Through you, I express my fervent prayers for the peoples and governments that you represent with such dignity and competence. Your community suffered a bereavement some weeks ago: the Ambassador of France, Monsieur Bernard Kessedjian, ended his earthly pilgrimage; may the Lord welcome him into his peace! My thoughts today go especially to the nations that have yet to establish diplomatic relations with the Holy See: they too have a place in the Pope’s heart. The Church is profoundly convinced that humanity is a family, as I wanted to emphasize in this year’s World Day of Peace Message.

2. It was in a family spirit that diplomatic relations were established last year with the United Arab Emirates. In the same spirit, I was also able to visit certain countries that I hold dear. The enthusiastic welcome that I received from the Brazilians continues to warm my heart! In that country, I had the joy of meeting the representatives of the great family of the Church in Latin America and the Caribbean, gathered at Aparecida for the Fifth General Conference of CELAM. In the economic and social sphere, I was able to note eloquent signs of hope for that continent, as well as certain reasons for concern. We all look forward to seeing increasing cooperation among the peoples of Latin America, and, within each of the countries that make up that continent, the resolution of internal conflicts, leading to a consensus on the great values inspired by the Gospel. I wish to mention Cuba, which is preparing to celebrate the tenth anniversary of the visit of my venerable Predecessor. Pope John Paul II was received with affection by the authorities and by the people, and he encouraged all Cubans to work together for a better future. I should like to reiterate this message of hope, which has lost none of its relevance.

3. My thoughts and prayers are directed especially towards the peoples affected by appalling natural disasters. I am thinking of the hurricanes and floods which have devastated certain regions of Mexico and Central America, as well as countries in Africa and Asia, especially Bangladesh, and parts of Oceania; mention must also be made of the great fires. The Cardinal Secretary of State, who went to Peru at the end of August, brought me a first-hand account of the destruction and havoc caused by the terrible earthquake, but he spoke also of the courage and faith of the peoples affected. In the face of tragic events of this kind, a strong joint effort is needed. As I wrote in my Encyclical on hope, “the true measure of humanity is essentially determined in relationship to suffering and to the sufferer. This holds true both for the individual and for society” (Encyclical Letter Spe Salvi, 38).

4. The international community continues to be deeply concerned about the Middle East. I am glad that the Annapolis Conference pointed towards the abandonment of partisan or unilateral solutions, in favour of a global approach respectful of the rights and legitimate interests of all the peoples of the region. I appeal once more to the Israelis and the Palestinians to concentrate their energies on the implementation of commitments made on that occasion, and to expedite the process that has happily been restarted. Moreover, I invite the international community to give strong support to these two peoples and to understand their respective sufferings and fears. Who can remain unmoved by the plight of Lebanon, amid its trials and all the violence that continues to shake that beloved country? It is my earnest wish that the Lebanese people will be able to decide freely on their future and I ask the Lord to enlighten them, beginning with the leaders of public life, so that, putting aside particular interests, they will be ready to pledge themselves to the path of dialogue and reconciliation. Only in this way will the country be able to progress in stability and to become once more an example of the peaceful coexistence of different communities. In Iraq too, reconciliation is urgently needed! At present, terrorist attacks, threats and violence continue, especially against the Christian community, and the news which arrived yesterday confirms our concern; it is clear that certain difficult political issues remain unresolved. In this context, an appropriate constitutional reform will need to safeguard the rights of minorities. Important humanitarian aid is necessary for the peoples affected by the war; I am thinking especially of displaced persons within the country and refugees who have fled abroad, among whom there are many Christians. I invite the international community to be generous towards them and towards their host countries, whose capacities to absorb them have been sorely tested. I should also like to express my support for continued and uninterrupted pursuit of the path of diplomacy in order to resolve the issue of Iran’s nuclear programme, by negotiating in good faith, adopting measures designed to increase transparency and mutual trust, and always taking account of the authentic needs of peoples and the common good of the human family.

5. Turning our gaze now towards the whole of Asia, I should like to draw your attention to some other crisis situations, first of all to Pakistan, which has suffered from serious violence in recent months. I hope that all political and social forces will commit themselves to building a peaceful society, respectful of the rights of all. In Afghanistan, in addition to violence, there are other serious social problems, such as the production of drugs; greater support should be given to efforts for development, and even more intensive work is required in order to build a serene future. In Sri Lanka it is no longer possible to postpone further the decisive efforts needed to remedy the immense sufferings caused by the continuing conflict. And I ask the Lord to grant that in Myanmar, with the support of the international community, a season of dialogue between the Government and the opposition will begin, ensuring true respect for all human rights and fundamental freedoms.

6. Turning now to Africa, I should like first of all to reiterate my deep anguish, on observing that hope seems almost vanquished by the menacing sequence of hunger and death that is unfolding in Darfur. With all my heart I pray that the joint operation of the United Nations and the African Union, whose mission has just begun, will bring aid and comfort to the suffering populations. The peace process in the Democratic Republic of Congo is encountering strong resistance in the vicinity of the Great Lakes, especially in the Eastern regions, while Somalia, particularly Mogadishu, continues to be afflicted by violence and poverty. I appeal to the parties in conflict to cease their military operations, to facilitate the movement of humanitarian aid and to respect civilians. In recent days Kenya has experienced an abrupt outbreak of violence. I join the Bishops in their appeal made on 2 January, inviting all the inhabitants, especially political leaders, to seek a peaceful solution through dialogue, based on justice and fraternity. The Catholic Church is not indifferent to the cries of pain that rise up from these regions. She makes her own the pleas for help made by refugees and displaced persons, and she pledges herself to foster reconciliation, justice and peace. This year, Ethiopia is marking the start of the third Christian millennium, and I am sure that the celebrations organized for this occasion will also help to recall the immense social and apostolic work carried out by Christians in Africa.

7. And finally, focussing upon Europe, I rejoice at the progress that has been made in various countries of the Balkan region, and I express once again the hope that the definitive status of Kosovo will take account of the legitimate claims of the parties involved and will guarantee security and respect for the rights of all the inhabitants of this land, so that the spectre of violence will be definitively removed and European stability strengthened. I should like also to mention Cyprus, recalling with joy the visit of His Beatitude Archbishop Chrysostomos II last June. It is my earnest wish that, in the context of the European Union, no effort will be spared in the search for a solution to a crisis that has already lasted too long. Last September, I made a visit to Austria, partly in order to underline the essential contribution that the Catholic Church is able and willing to give to European unification. On the subject of Europe, I would like to assure you that I am following attentively the new phase which began with the signing of the Treaty of Lisbon. This step gives a boost to the process of building the “European home”, which “will be a good place to live for everyone only if it is built on a solid cultural and moral foundation of common values drawn from our history and our traditions” (Meeting with the Authorities and the Diplomatic Corps, Vienna, 7 September 2007) and if it does not deny its Christian roots.

8. From this rapid overview it appears clearly that the security and stability of the world are still fragile. The factors of concern are varied, yet they all bear witness to the fact that human freedom is not absolute, but is a good that is shared, one for which all must assume responsibility. It follows that law and order are guarantees of freedom. Yet law can be an effective force for peace only if its foundations remain solidly anchored in natural law, given by the Creator. This is another reason why God can never be excluded from the horizon of man or of history. God’s name is a name of justice, it represents an urgent appeal for peace.

9. This realization could help, among other things, to give direction to initiatives for intercultural and inter-religious dialogue. These ever increasing initiatives can foster cooperation on matters of mutual interest, such as the dignity of the human person, the search for the common good, peace-building and development. In this regard, the Holy See attaches particular importance to its participation in high-level dialogue on understanding among religions and cultures and cooperation for peace, within the framework of the 62nd General Assembly of the United Nations (4-5 October 2007). In order to be true, this dialogue must be clear, avoiding relativism and syncretism, while at the same time it must be marked by sincere respect for others and by a spirit of reconciliation and fraternity. The Catholic Church is deeply committed to this goal. It is a pleasure for me to recall once again the letter that was addressed to me, on 13 October last, by 138 Muslim Religious Leaders, and to renew my gratitude for the noble sentiments which were expressed in it.

10. Our society has rightly enshrined the greatness and dignity of the human person in various declarations of rights, formulated in the wake of the Universal Declaration of Human Rights, which was adopted exactly sixty years ago. That solemn act, in the words of Pope Paul VI, was one of the greatest achievements of the United Nations. In every continent the Catholic Church strives to ensure that human rights are not only proclaimed but put into practice. It is to be hoped that agencies created for the defence and promotion of human rights will devote all their energies to this task and, in particular, that the Human Rights Council will be able to meet the expectations generated by its creation.

11. The Holy See for its part never tires of reaffirming these principles and rights, founded on what is essential and permanent in the human person. The Church willingly undertakes this service to the true dignity of human persons, created in the image of God. And on the basis of these considerations, I cannot but deplore once again the continual attacks perpetrated on every continent against human life. I would like to recall, together with many men and women dedicated to research and science, that the new frontiers reached in bioethics do not require us to choose between science and morality: rather, they oblige us to a moral use of science. On the other hand, recalling the appeal made by Pope John Paul II on the occasion of the Jubilee Year 2000, I rejoice that on 18 December last the General Assembly of the United Nations adopted a resolution calling upon States to institute a moratorium on the use of the death penalty, and I earnestly hope that this initiative will lead to public debate on the sacred character of human life. I regret, once again, the disturbing threats to the integrity of the family, founded on the marriage of a man and a woman. Political leaders, of whatever kind, should defend this fundamental institution, the basic cell of society. What more should be said? Even religious freedom, “an essential requirement of the dignity of every person [and] a cornerstone of the structure of human rights” (Message for the 1988 World Day of Peace, Preamble) is often undermined. There are many places where this right cannot be fully exercised. The Holy See defends it, demands that it be universally respected, and views with concern discrimination against Christians and against the followers of other religions.

12. Peace cannot be a mere word or a vain aspiration. Peace is a commitment and a manner of life which demands that the legitimate aspirations of all should be satisfied, such as access to food, water and energy, to medicine and technology, or indeed the monitoring of climate change. Only in this way can we build the future of humanity; only in this way can we facilitate an integral development valid for today and tomorrow. With a particularly felicitous expression, Pope Paul VI stressed forty years ago in his Encyclical Letter Populorum Progressio, that “development is the new name for peace”. Hence, in order to consolidate peace, the positive macroeconomic results achieved by many developing countries during 2007 must be supported by effective social policies and by the implementation of aid commitments by rich countries.

13. Finally, I wish to urge the international community to make a global commitment on security. A joint effort on the part of States to implement all the obligations undertaken and to prevent terrorists from gaining access to weapons of mass destruction would undoubtedly strengthen the nuclear non-proliferation regime and make it more effective. I welcome the agreement reached on the dismantling of North Korea’s nuclear weapons programme, and I encourage the adoption of suitable measures for the reduction of conventional weapons and for dealing with the humanitarian problems caused by cluster munitions.

Your Excellencies, Ladies and Gentlemen,

14. Diplomacy is, in a certain sense, the art of hope. It lives from hope and seeks to discern even its most tenuous signs. Diplomacy must give hope. The celebration of Christmas reminds us each year that, when God became a little child, Hope came to live in our world, in the heart of the human family. Today this certainty becomes a prayer: May God open the hearts of those who govern the family of peoples to the Hope that never disappoints! With these sentiments, I offer to each one of you my very best wishes, so that you, your staff, and the peoples you represent may be enlightened by the Grace and Peace which come to us from the Child of Bethlehem.

© Copyright 2008 – Libreria Editrice Vaticana