Is Capitalism Destroying the World?

Many Catholics are aware of the Church’s condemnation of socialism. But are there also issues with capitalism? While popes have praised many values often associated with capitalism, they have also warned against extreme forms of the system that undermine human rights.

Here are some problems with capitalism that we see in our world today.

Capitalism, like socialism, can lead to a concentration of power.
G.K. Chesterton famously remarked that, historically, the problem with capitalism is there are “too few capitalists.” As a result, power is taken from families and put in the hands of a small number in charge.

We see these problems when a few big businesses dominate certain industries. Not only is competition weakened, but these corporations end up having more political power and money and can more easily exploit their workforce.

Extreme forms of capitalism may ultimately lead to socialism.
When capitalism gets out of hand, the government has to enact regulations. That’s fine as long as these genuinely protect the legitimate rights of businesses, their workers, and their customers.

When big business continually undermines the rights of workers and the public at large, people more readily embrace extreme government intervention, as socialist and communist societies demonstrate.

The ultimate measure of an economic system is how well it respects and protects the dignity of the human person, who is made in God’s image.
One may argue that capitalism does this better than socialism. But even capitalism needs to be reigned in, as Pope St. John Paul II taught: “….Can it perhaps be said that, after the failure of communism, capitalism is the victorious social system, and that capitalism should be the goal of the countries now making efforts to rebuild their economy and society?.…If by ‘capitalism’ is meant an economic system which recognizes the fundamental and positive role of business, the market, private property and the resulting responsibility for the means of production, as well as free human creativity in the economic sector, then the answer is certainly in the affirmative, even though it would perhaps be more appropriate to speak of a ‘business economy,’ ‘market economy’ or simply ‘free economy.’ But if by ‘capitalism’ is meant a system in which freedom in the economic sector is not circumscribed within a strong juridical framework which places it at the service of human freedom in its totality, and which sees it as a particular aspect of that freedom, the core of which is ethical and religious, then the reply is certainly negative.”

The Church doesn’t officially endorse a particular economic system. It does teach the values that any truly just economy should have. It’s incumbent upon us to let our minds be molded by these teachings as we participate in political life.