What Ghanaians Can Learn From Pope Francis 1

Mon, 3 Aug 2015 Source: Kwarteng, Francis


Dr. Douglass J. Amy, professor of politics at Massachusetts’ Mount Holyoke College, sums it best: “The market is not God and the government is not the Devil. Despite their enormous advantages, markets are not benign and self-regulating. They create numerous social, economic, and political problems that only government can correct. Government is also not the sworn enemy of business and capitalism…Similarly, those who celebrate the achievements of business and a market economy should also acknowledge and celebrate the role government has had in those accomplishments.”

Indeed, Pope Francis and the world at large know the market is not God. On that basis the conversation should have begun and ended there. But no. Some are not willing to accept this fact even when the market crashes right before their eyes. That said, we may have to equally accept the fact that Prof. Amy’s arguments is about the “mixed economy” model, perhaps the most widely used political economy model on the planet. Then again his seven-part essay “Capitalism Requires Government” dispels some of the major myths about laissez-faire, or free-market, capitalism. It is here, among other things, that we acknowledge the intellectual rightness of Kwame Nkrumah vis-a-vis questions of political economy, development economy and development sociology.

Similarly, following the arguments of Amy Nobel Laureate (economics) Joseph Stiglitz sees Smith’s “invisible hand” as a myth, writing thus: “Adam Smith, the father of modern economics, is often cited as arguing for the ‘invisible hand’ and free markets; firms…But unlike his followers, Adam Smith was aware of some of the limitations of free markets, and research since then has further clarified why free markets, by themselves, often do not lead to what is best…the reason that the invisible hand often seems invisible is that it is often not there” (Altman). This view is hardly controversial or debatable because experience provides endless examples in human history.

Furthermore, like Stiglitz and Amy, Keynes’ believed that the “tacit assumptions” underlying classical economics are “seldom met or never satisfied, with the result that it can never solve the problems of the actual world. But if our central controls succeed in establishing an aggregate volume of output corresponding to full employment as nearly as is practicable, the classical theory comes into its own from this point onwards.” Yet he also did not depart from some of the core ideas of classical economics, such as the theoretical foundation upon which laissez-faire capitalism is supposedly erected, thus writing in “The General Theory of Unemployment, Income and Money”:

“There is no objection to be raised against the classical analysis of the manner in which private self-interest will determine what in particular is produced, in what proportions the factors of production will be combined to produce it, and how the value of the final product will be distributed among them.”

This is classic Smithian economics. Thus Nobel Laureate (economics) Paul Krugman is correct to note in his introduction to “The General Theory” that: “But Keynes was no socialist–he came to save capitalism, not to bury it. And there’s a sense in which ‘The General Theory’ was, given the time it was written, a conservative book.” Krugman may be correct in his assessment of Keynes when he also noted as per “The General Theory”: “But beyond this no obvious case is made out for a system of State Socialism which would embrace most of the economic life of the community.” Keynes also made it clear in his famous book that the state should not assume “the ownership of the instruments of production” as an important point of reference for its own sake. Rather the state, as he saw it, should reward those who own the instruments of production by both determining and devoting “the aggregate amount of resources” to the instruments, for, among other things, he saw this critical idea as one of the primary responsibilities of government.

Keynes also noted: “Thus, apart from the necessity of central controls to bring about an adjustment between the propensity to consume and the inducement to invest, there is no more reason to socialize economic life than there was before.” In other words he seems to imply that once state intervention has recovered an ailing economy from the grip of recession, the market could then take over from there on its own. He even goes further on the question of how individual liberty and “the exercise of personal choice” make for market mechanism: “the best safeguard of the variety of life…and the loss of which is the greatest of all the losses of the homogenous or totalitarian state…the most secure and successful choices of former generations…it is the most powerful instrument to better the future.” There is a lot in “The General Theory”

It is against this background that economist David M. Wright said in 1945 that “a conservative political candidate could easily run a campaign largely on quotations from ‘The General Theory’” while economist Gottfried Haberler, a product of the conservative Austrian school and a colleague of Joseph Schumpeter, argued that the policy prescriptions of Keynesian economics were conservative (Bartlett).

These facts are contrary to a thinker who dogmatically abhors free-market economics. Significantly, though, one of the subtle arguments made by Keynes in “The General Theory” is that government needs to intervene in addressing the crises of mass unemployment, recession, and so on in order to sustain capitalism and the market, else other economic models such as socialism will take over. Perhaps this also goes to the heart of Krugman’s contention that Keynes “came to save capitalism, not to bury it.” This is also why there are honest conservative economists, political analysts, and writers from around the world who proudly claim Keynes as one of their own, with some dismissing the socialist label associated with him and others seeing him as ultraconservative rather than conservative.

For instance, Peter Drucker, “the founder of modern management” and one of the conservative admirers of Keynes, sees the latter as ultraconservative, even going so far as to say of him [Keynes]: “He had two basic motivations. One was to destroy the labor unions and the other was to maintain the free market.” In fact, readers will be surprised at some of the things Keynes had to say about communism, Marx, etc., to Bernard Shaw and other prominent figures of his time (Bartlett). We should also point out that Keynes was equally sharply critical of laissez-faire capitalism, but that is hardly the concern of those critics of Keynes who simply refuse to push their intellectual boundaries in the way of looking for hard facts of intellectual history beyond platitudinous anecdotes (Phelps). Keynes was sharply critical of Marxism as well and “The General Theory” substantively seems to be a compromise between the two dominant economic theories. The irony is that both Keynes and Adam Smith are hated and loved across the ideological partition.

Yet Keynes brought the best macroeconomic ideas together in one place in a way many economists have not successfully done before and after him. His practical and theoretical ideas constitute what has come to be known as the “mixed economic system.” And there are various expressions of this system in almost every modern economy. From the American economy to the Cuban economy, from the Nordic Model to the Asian Tigers, from the Japanese economy to Latin American economies, and so on are based on the concept of mixed economy, the central pillar of Keynesian economics. The purity of capitalism and communism exists only on paper, not otherwise. It should be stressed also that the world’s most well-off societies with the highest average standard of living are, in fact, those whose economies are based on the mixed economy model (see Human Development Index (HDI)).

These facts are far from what some misinformed critics of Keynes know. This is painfully regrettable. Of course the highlight of Krugman’s critique of “The General Theory” is, however, when he admits that: “A very large part of what modern macroeconomists do derives directly from ‘The General Theory’; the framework Keynes introduced holds up very well to this day.” The general theory of Keynes and its revision are the success stories of the latter half of the 20th century and of the first half of the 21st century. As a matter of fact, Keynes’ intellectual work primarily contributed to laying the foundations for modern macroeconomics and the methodology econometrics, among others (Colander & Landreth). No economy can hope to exist outside the methodological framework of macroeconomics since it provides great insights into the health and behavior of national economies. Macroeconomics is therefore essential to an understanding of political economy, and vice versa.

Robert Skidelsky is right then to refer to him as “the economist as a savior,” incidentally the subtitle of his second biography of Keynes. Others whose works have expanded, revised and critiqued “The General Theory,” winning Nobel Memorial Prize in Economics on that account include James Tobin, Robert Solow, Paul Samuelson, John Hicks (Econlib) and Lawrence Klein. According to Cronin and Miller, quoting Harvard economist Martin Feldstein “Mr. Klein was the first to develop the statistical models that embodied Keynesian economics, an influential important tool that is still used by the Federal Reserve, and other central banks, as well as by private forecasters…His computer-driven models, some of which now factor in almost 2,000 economic variables, are used today by the International Monetary Fund, the World Bank and other institutions.” In addition, Mr. Klein did construct models for the United Kingdom, Hong Kong, South Korea, India, China, Mexico, India, and Brazil. We know from this that Keynesian economics is a powerful tool with global appeal.

These facts are not idle statements but strong views born of easily provable facts. What is the point of these truisms? It is obvious what these scholars seem to share in common is the unnaturalness of the market and what state or government intervention can bring to bear on redirecting the market towards its state of seeming naturalness. Of course, much has been said lately about where exactly the world is heading in the direction of existential challenges confronting man. The baggage of history, structural inequality and social injustice, racism and ethnocentrism, environmental degradation and resource depletion, religious terrorism and intolerance, sexism, rising disease burden and emerging diseases, climate disasters, and corporate thievery constitute a partial list of the global trend of challenges confronting the human condition.

What do we do? Framing appropriate answers to deal with these human challenges has not been an easy undertaking and, yet, perhaps also more controversially, the answers themselves seem to complicate the human condition even further, with political ideology, religion, and science and their adherents taking different, and sometimes hostile, attitudes toward the very answers designed to damp down human challenges and thereupon pave a way forward for what Pope Francis has called “communitarian economics.”

More important for us, though, one of Pope Francis’s recent speeches (2015) provides deeper insights into the myriad of economic crises facing humanity and the environment. Yet equally true is the fact that Pope Francis’s indictment of the global economic system is nothing new. Pope John Paul (11) and others before him issued similar encyclicals on the subject matter. In fact it has been an ongoing global debate in the past two decades or so. Finally, Pope Francis’s boldness in confronting the evil past of the Catholic Church, what he has called “grave sins,” and issuing formal apologies on behalf of the Church is commendable. Needless to say, the apologies have not gone far enough.


We should first point out that it is not our intention to embrace Pope Francis’s theologization of socio-economic realities uncritically, per se. Rather, it is his realism, forthrightness and the political subtext of his uncompromising indictment of the global economic order that are of utmost interest to us. Having said that, one wonders why a powerful institution such as the Catholic Church, which played a central role in undermining and overthrowing “communism” in Eastern Europe and parts of Asia, make a sudden volte-face in the 21st century, calling “capitalism” many names: “Idolatrous economy,” “the dung of the devil,” “new tyranny,” “a new colonialism.” The greatest irony today is that, the same Catholic Church is calling for the overthrow of the global economic order, while its stead is taken over by a more progressive system that respects and preserves the environment, human dignity, sustainable development, community, and social justice.

Still, it is the glaring parallels he draws between the behavior of the global economic order and colonialism that deserve our attention. Certainly, Pope Francis should be cognizant of the central role slavery and colonialism played in making the modern world, including capitalism. Eric Williams demonstrated that fact by showing how profits from slavery contributed to making James Watt’s steam engine (an improved version of Thomas Newcomen’s invention) possible, one of the major drivers of Britain’s Industrial Revolution (see also Beckert). Likewise, historian Edward Baptist shows the connections between slavery and American capitalism. This background information is important if we may want to understand the larger context of Pope Francis’s concerns because some of the capitalist conditions, including subsistent pay schemes, under which people toil, are not markedly different from those which slaves endured in the Americas.

Pope Francis’s Bolivian speech hinted at some of these deplorable. And more. Capitalism also has had strong ties to mercantilism and neo-mercantilism, environmental contamination, wars, extermination and forced displacement of human beings, destruction of cultures, resource depletion, colonialism and imperialism, Apartheid and Jim Crowism, greed, global instability, coup d’états and political assassinations, and various international crimes too numerous to mention here. These “evils” underline the complexity of capitalism, a subject that is only beginning to gain attention in research institutions. In fact there is a vast body of literature on this subject matter linking slavery to the birth of capitalism. Let us visit this difficult subject matter question again. Rockman and Beckert write:

“America's ‘take-off’ in the 19th century wasn't in spite of slavery; it was largely thanks to it. And recent research in economic history goes further: It highlights the role that commodified human beings played in the emergence of modern capitalism itself.”

The authors continue elsewhere: “The perverse reality of a capitalized labor force led to new accounting methods that incorporated (human) property depreciation in the bottom line as slaves aged, as well as new actuarial techniques to indemnify slaveholders from loss or damage to the men and women they owned. Property rights in human beings also created a lengthy set of judicial opinions that would influence the broader sanctity of private property in U.S. law.”

Beckert and Rockman explore the question in much greater detail in their edited volume “Slavery’s Capitalism: A New History of American Economic Development.” More controversially, the legal definition of “corporation” assumes the place of “human beings” in the aforesaid attribution. Then also Wall Street, slavery, and American capitalism are allies, a position taken by the Editorial Board of “The New York Times” (see also Singer; Schermerhorn; Farrow et al.). The Board writes:

“Of all the commodities traded over time on Wall Street, the one that goes discreetly unmentioned in historical markers is human beings—the anxious throngs of kidnapped slaves that the New York City government routinely rented and auctioned off across half a century at the end of Wall Street at the East River…But no spotlight at all on slaves, even though they were pioneer Wall Streeters—their labor built much of the city’s infrastructure, including the early City Hall, stretches of Broadway and the signature wall that first defined Wall Street. The city is finally rectifying this with plans for a 16-by-24-inch memorial sign whose wording has not been set but will acknowledge that the city did indeed run a profitable slave market, rivaled only by Charleston, S.C., as a hub for the American slave traffic.”

The Board continues:

“Are modern New Yorkers aware of this inglorious history? ‘Not at all,’ says a city councilman, Jumaane Williams, who proposed the marker at the behest of Christopher Cobb, a historian with a passion for details. ‘This sort of knowledge is generational,’ notes Mr. Cobb, who feared an enormous fact—that a city slave market operated at the geographical birthplace of American capitalism—was slipping from sight.”

These historical facts are taking their rightful place in academic discourses linking slavery to American capitalism. Already, fifteen powerful American corporations have been identified as evolving out of the slave trade or directly profiting from it. JP Morgan Chase, Lehman Brothers, and Aetna, Inc. appear among them (ABS Staff). Conceivably, American corporations today enjoy more protection under the Fourteenth Amendment than African-Americans and the American poor do under the umbrella of the same legal instrument, the Fourteen Amendment. It is called corporate personhood. Equally important to the ongoing debate is the fact that a number of America’s elite universities are in existence on account of the largesse of slavery (Wilder). It is obvious then how slavery practically made capitalism and capitalism in turn made America!

Indeed, these questions are nothing new to students of history. Above all, Pope Francis must have known these facts because his predecessors knew them intimately, because lay and Catholic scholars and historians alike have written extensively about them, because the papacy and the Catholic Church endorsed the enslavement of Native Americans and Africans and the colonization of Africa and the Americas, and because Pope John Paul (11) apologized for the Church’s role in enslaving Africans (Dionne). These facts notwithstanding, the Catholic Church itself has contributed to capitalism in several questionable capacities, for instance, money laundering (Posner). The collaborations between Pope Pius XI and Benito Mussolini in the entrenchment of fascism make for another troubling episode in the relationship between the papacy and secular authority (Kertzer).

Once again these facts are not new. It is how Pope Francis teases out the striking parallels among slavery, colonialism, neocolonialism and capitalism that arrests our attention. Other researchers have also looked at the subtle and explicit aspects of the legacies of slavery, imperialism and colonialism on capitalism and race relations (Degruy; Alexander; Blackmon). The Catholic Church’s and European monarchies’ central role in or support for the evolution of mercantilism and how Europe profited from its neo-mercantilism policies in Africa have not escaped the attention of historians (Botwe-Asamoah). One of the important products of the rigorous critique of mercantilism is Adam Smith’s “The Wealth of Nation.” Certain evil aspects of mercantilism are still here with us in the callous bosom of capitalism.


Pope Francis might be deeply worried at the rate at which the “mentality of profit” upends social inclusion, undermine human dignity, and underwrite environmental destruction. His primary preoccupation with bridging the gulf separating free-market greed, social exclusion of the masses, and the “mentality of profit” is, perchance, informed by one of the central social teachings of the Catholic Church, particularly liberation theology, a concept minted and developed by Gustavo Gutierrez, a Peruvian priest and theologian. The idea itself evolved in Latin America and before long became a global phenomenon, gaining strong footholds in Black South Africa during the Apartheid era and among the black communities of the US and Britain and spreading through the Catholic Church. The concept eventually exerted some impact on the decolonization of South Africa as well as firing up the US Civil Rights Movement.

On the other hand, it is also generally believed that Pope Francis was critical of the concept during its inception but, somehow, he came under its influence with regard to the Argentine brand of liberation theology. Even so, there is no doubt in our minds that liberation theology has fundamental if remarkable resemblances to the Bantu philosophy Ubuntu, without the element of Christian dogma. This is because both systems eschew racism and ethnocentrism and because both systems promote humanism, solidarity, social justice, community, social equity, social justice, inclusiveness, and poverty reduction. Nelson Mandela embraced Ubuntu and Pope Francis liberation theology for transforming their respective societies and bringing a sense of justice and equality to their societies, where racism, colonialism, balkanization, and global capitalism threatened the environment and human dignity, breeding and entrenching structural inequality and discrimination.

Thus Pope Francis Bolivian speech shares some of the hallmarks of liberation theology. But his critique is not dogmatic. It bears the unmistakable stamp of the verifiable outspokenness of science and the radical elements of rational criticism. The speech in question, therefore, endorses the moral imperative of social solidarity steadfastness, and hard work and what they mean to a people’s economic and political emancipation in the face of the evils of capitalism, especially unfettered free-market economics. It also takes up the negative impact of drugs on Latin America. The current American war on drugs which has partly shifted the focus of the drug trade from the Americas to Africa represents another troubling trend that, if not vigorously checked, will undermine the political stability of Africa, affect productivity adversely, threaten Africa’s future as it consumes the youth, and contribute negatively to public expenditure on public health.

Yet we see drug dealing infecting Ghanaian politics as well as others channeling illegal profits from drug dealing into Ghanaian capitalism. The Ghanaian example is replicated across Africa, particularly West Africa. Let us not ignore the fact that the new-found Ghanaian winner-takes-all capitalism, a concept directly copied from the book of American democratic capitalism, encourages gross monetization of multi-party democracy no matter where the questionable source of political funding is coming from.

The speech in question did not touch on these variables. They can merely be inferred in the particular case of Latin America. The drug issue is a complicated subject matter. America with all her technological prowess, intelligence capability, and military might has not been successful in solving the drug menace. Yet evidence exists to support the view that the Reagan Administration was probably aware of drugs being smuggled into the country. Michelle Alexander, Jeffrey St. Clair, and Alexander Cockburn have all written about the Central Intelligence Agency’s (CIA) admission, in 1998, that, the Nicaraguan-based Contra rebels which the Reagan Administration had been supporting, materially and intelligence-wise, in the 1980s, had in fact been smuggling drugs into America. This occurred during the same period they were receiving support from the Reagan Administration (the authors contend that the Contra rebels smuggled drugs into mostly inner cities (African Americans)).

Again, the aforesaid three writers provide ample evidence showing that officials close to President Reagan prevented the Drug Enforcement Administration (DEA) from bringing the illicit activities of the Contra rebels to public attention (Note: St. Clair and Cockburn also provide vital information on the CIA bringing in Nazi scientists to work on chemical and biological that were tested on African-Americans). Drug cartels also have ties to global capitalism through the international banking system, what one writer calls “drug war capitalism” (Paley). This is well documented. Investigations by the State Department and the U.S. Senate Permanent Subcommittee of Investigation, for instance, have revealed how elite American banks laundered drug-generated money on behalf of Latin America drug cartels. This accounts for how some of these elite banking institutions survived the 2008 recession in the first place.

As a matter of fact, some major American drug dealers quit the business of drug dealing and thereafter strategically channel their illegal profits into genuine businesses which are then taxed, thus contributing to American capitalism and GDP. The informal economy based on the commercial activities of drug cartels has been big business in Western capitalism, even in global capitalism. Drug contributes to the GDPs of individual European countries as well. No wonder the European Union (EU) requires its members to include data in their hidden or informal economies in their re-based GDPs. Sales from drugs (cocaine, amphetamine, cannabis, heroin, ecstasy, and crack cocaine) and prostitution (sex work) ballooned Britain’s GDP during its re-basing in 2014. Then there are pharmaceutical companies that went about bribing doctors in America, to mention but one country, to recommend or prescribe for patients medications some of whose indication(s) have not been approved by the Food and Drug Administration (FDA). Incidentally the volume of sale of some of these medications goes up and this is, accordingly, reflected positively on the books of Wall Street, one of the false-positive indications of American capitalism doing well.

Yet the books of Wall Street completely ignore casualty statistics. In fact Wall Street makes a swift volte-face only when the FBI, the federal government, and the law catch up with it. Yet proponents of laissez-faire market economy consistently argue that the market is self-regulating and even perfect, both of which are contrary to experience. They also argue that state or government intervention should be resisted at all cost. To them Keynesian economics is contrary to the tenets of laissez-faire market economy, a view Smith himself contradicted in “The Wealth of Nations.” Not even Reagan could completely do away with Keynesian economics. Krugman is correct to note that the detractors of Keynesian economics even use it all the time. The detractors include individuals, institutions, and governments. And as we alluded to elsewhere, nearly all the economies on the planet today are essentially Keynesian, namely, based on the mixed economy model.

These reservations notwithstanding, the question then becomes: Where is the global economic order leading the world today? This question seems to define the moral bedrock upon which Pope Francis’s erected his Bolivian speech.

This same question has taken a chunk of space in the international community and academic circles as to what exactly to do with the cascading progression of unfolding crises occasioned by failures of global capitalism. It turns out global capitalism does not have all the answers. It turns out Keynesian economics has always come in handy in tough times of economic crisis. We have seen the mathematical, moral, and philosophical power of Keynesian economics come to the aid of limping economies in the 20th and 21st centuries from Asia (Japan, Russia, and the so-called Asian Tigers), Europe, Latin America, Canada, and Australia to Africa. Arguably Keynesian economics has primarily displaced the conventional wisdom of Smithian classical economics in these tough times. Yet Keynesian economics is not totally divorced from the basics of Smithian classical economics, a fact we conceded at the beginning of this essay. Where would the world have been without the oversight and intervention of Keynesian economics?

To answer this question we need to revisit some of our earlier examples. We have stated the case that banking, politics, money laundering, and drug cartels have become useful allies in Africa’s political economy. Then also insider trading, money laundering, unethical conduct in transactions, monopoly and oligarchy, information asymmetry, corruption, interest-rate fixing (Libor scandal, for instance), World Bank/IMF interventions (austerity measures), government subsidies and bailouts, protectionism, tariffs, lobbying, quantitative easing, etc., all go to show how the market conceived by some as a natural phenomenon passes for a gargantuan myth. Mostly Swiss, American, French, and British banks profit from these fraudulent international schemes. There are Western banks that train their employees in the techniques of assisting individuals to evade taxes by hiding money in offshore accounts (Democracy Now). Global capitalism also facilitates this on a grander scale (Henry). These are just a handful of illegal activities driving the engine of global capitalism and of Western economies.

It is also no secret how the financially powerful in America use their clout with the executive and the legislature to enact and advance legal instruments aimed primarily at sustaining and perpetuating their business empires and profitability profiles (Domhoff; McKee & Benjamin). Again, in America government regulations are oftentimes pursued by individuals and organizations with strong ties to Wall Street and its technocrats (Connaughton; Madrick; Johnson & Kwak). The first covers Wall Street crimes such as securities fraud, insider trading and stock/market manipulation; the middle treat some of the major failures of the economic policies of Alan Greenspan, Ronald Reagan, Richard Nixon, and Milton Friedman; and last two unravel the complex relationship between American corporations and American politics and how the former capitalizes on that political connection to stifle government regulations and to underwrite its monopolization of the global economy.

In spite of these, admirers of Reagan holds him up as an enviable god of the free-market religion as one political writer notes (Richman): “Yet after nearly eight years of Reaganism, the clamor for more government intervention in the economy was so formidable that Reagan abandoned the free-market position and acquiesced in further crippling of the economy and our liberties. In fact, the number of free-market achievements by the administration are so few that they can be counted on one hand—with fingers left over.” Generally speaking, the empirical statistics/data presented as part of the critique of Reagan are not in favor of his political legacy, in spite of his worn-out clamor of laissez-faire rhetoric, of his keeping the size of the federal government down (Samples).

Another political analyst describes the free-market policies of the Reagan era as “the myths of Reaganomics” (Rothbard). It is however convenient for admirers of Reagan and free-market fundamentalism to shift the deficits of Reaganomics to Democrats, while conservative Democrats who sided with conservative Republicans and liberal Republicans who sided with liberal Democrats during the Reagan presidency on questions of senatorial deliberations and voting on enactments, are assigned short thrift in the political literature of America. So much for Reagnomics and the chimera of laissez-faire capitalism.

Thus Keynesian economics was as much an integral component of Reagan’s internal politics just as it was, and still is, the foundation of America’s political economy. Keynesian economics therefore tells us when a political economy is unhealthy and when it is relatively doing well. Reportedly the U.S. Security and Exchange Commission (SEC) has been in the news again, accused by one of its own attorneys, a whistleblower called Darcy Flynn, of illegally destroying thousands of documents to shield “Wall Street criminals” from investigation and prosecution for a litany of crimes. It is also reported that the SEC’s destruction of documents has been going on at least since 1993. It turns out “many of the destroyed files involved companies and individuals who would later play prominent roles in the economic meltdown of 2008” (Taibbi). One of those whose names Taibbi mentions in his investigative report is Bernard Madoff, operator of the largest Ponzi scheme in American history. Madoff swindled investors to the tune of tens of billions of dollars.

On that score, Keynesian economics loses steam when government collaborates with the private sector to distort the supposed naturalness of the market, as the above example illustrates. In the end, Wall Street technocrats spend billions to lobby against regulations aimed at bringing it [Wall Street] under federal oversight in stemming financial crimes or to lobby in favor of regulations aimed at protecting its interests, leaving Smith’s “invisible hand” to suffocate on paper. This phenomenon describes a perfect instance of free-market fundamentalism. Another comparable example is when Ronald Reagan allowed his trite rhetoric of laissez-faire policies to undermine the aims of Superfund, a system put in place by the U.S. Congress to clean up the environment of pollutants or contaminants, in which case his administration left one industry after another off the hook (Opinion). What this and other examples illustrate is that the private sector pollutes and destroys the environment, as via galamsey activities in Ghana for instance, with the responsibility of cleaning up the environment falling on the shoulders’ of government and poor communities.

The private sector and foreign multinational companies also leave other negative externalities from their activities for poor communities and government to shoulder. The story is the same across Africa, Latin America, and Asia. Thus at this point the policy researches of the Asian-based Global Institute for Tomorrow (GIFT) are worth looking into (Nair), just as the world should pay attention to the political, philosophical, and moral substance of Pope Francis’s Bolivian speech. There is no doubt that Pope Francis’s speech makes perfect sense once it is constructively within the context of Keynesian economics. This seems to be the policy subtext of the researches undertaken by GIFT. Among other policy initiatives it has undertaken over the years, GIFT has proposed an economic model somewhat different from the West’s in which consumption habits are tied to “positive externalities” such as sustainable development, shared value, and environmental consciousness, and divorced from “negative externalities” such as resource depletion, corporate greed and unfettered capitalism, resource curse, and pollution.

In other words GIFT argues that production, corporate and human consumption habits respectively connected to raw materials and finished products, and rational choice decisions necessitate strategic oversight of proper resource management expertise, social justice, international cooperation, corporate social responsibility, green technology, while taking into consideration the economics of population growth, in order to achieve the level of sustainable development required to keep the world in a balance. This theory is not as simple as it seems but it is worth exploring. On the other hand the argument is not far removed from the substance of Pope Francis’s Bolivian speech. Neither is it a capitulation to socialist or capitalist dogma. It is practical and commonsensical economics.

In the end, Pope Francis has said what needs to be said and it is up to the world to decide what to do with his prescriptions. Our primary concern, though, is what Ghanaians, especially their leaders and technocrats and traditional leadership and members of the clergy, can make of this speech. Cardinal Francis may want to energize his Catholic base in Ghana, a point we cannot overlook given his position as the President of the Pontifical Council for Justice and Peace and the Council’s promotion of social justice around the globe. We may not necessarily ascribe to every tenet of Liberation Theology per se, but the concept’s political undertones and appeal have proven successful in many a difficult situation.

Again, Cardinal Turkson’s association with the drafting of Pope Francis’s environmental encyclical (2013) and of the overhaul of the international financial and monetary systems (2011) is well known. Coupling this with the radical politics of Liberation Theology can go a long way to bring positive changes to Ghanaian society. But the Church has to address its own internal contradictions even as it pursues its global agenda, including what we want to see Cardinal Turkson and the Church do in and for Ghana in terms of radical reforms. We otherwise argue for a non-partisan ecumenical approach to social justice.

We shall return…


1) ABS Staff. “15 Major Corporations You Never Knew Profited from Slavery.” Atlanta Black Star. Aug. 26, 2013.

2) Albert, Perkins. “Cooperative Economics: An Interview with Jaroslav Vanek.” New Renaissance Magazine, Vol. 5, No. 1.

3) Alexander, Michelle. “The New Jim Crow: Mass Incarceration in the Age of Colorblindness.”

4) Daniel. “A Q & A With Joseph Stiglitz, Managing Globalization.” Economist’s View. Oct. 11, 2006.

5) Amsdem, Alice H. “Next Giant: South Korea and Late Industrialization.”

6) Amy, Douglas J. “Capitalism Requires Government.” www.governmentisgood.com. 2007.

7) Blackmon, Douglas A. “Slavery By Another Name: The Re-Enslavement of Black Americans from the Civil War to World War 11.”

8) Baptist, Edward E. “The Half Has Never Been Told: Slavery and the Making of American Capitalism.”

9) Bartlett, Bruce. “Keynes Was Really a Conservative.” Forbes. Aug. 14, 2009.

10) Beckert, Sven. “Empire of Cotton: A New History of Global Capitalism.”

11) Botwe-Asamoah, Kwame. “The Fallacy of Britain Leaving Huge Sums of Money for Kwame Nkrumah’s Government.” Modernghana. July 2, 2015.

12) Cassidy, John. “How Markets Fail: The Logic of Economic Calamities.”

13) Chibber, Vivek. “Locked in State: State-Building and Late Industrialization in India.”

14) Cockburn, Alexander, and Jeffrey St. Clair. “Whiteout: The CIA, Drugs, and the Press.”

15) Colander, David, and Harry Landreth. “The Coming of Keynesianism to America.”

16) Constanza et al. “Development: Time to Leave GDP Behind.” Nature: International Journal of Science (505), p. 283-285. Jan. 15, 2014.

17) Connaughton, Jeff. “The Payoff: Why Wall Street Always Wins.”

18) Cooper, Alexia, and Erica L. Smith. “Homicide Trends in the United States, 1980-2008.” U.S. Department of Justice (Bureau of Justice Statistics. NCI 236081). Nov. 2011.

19) Cronin, Brenda, and Stephen Miller. “Nobel-Winning Economist Applied Forecasting Models to the Real World.” The Wall Street Journal. Oct. 23, 2013.

20) Degruy, Joy. “Post Traumatic Slave Syndrome: America’s Enduring Injury and Healing.”

21) Dionne, E. J. “Pope Apologizes to Africans for Slavery.” The New York Times. Aug. 14, 1985.

22) Domhoff, William. “Who Rules America?” The Triumph of the Corporate Rich.”

23) Farrow, Anne, Jennifer Frank and Joel Lang. “Complicity: How the North Promoted, Prolonged, And Profited from Slavery.”

24) Fioramonti, Lorenzo. “Gross Domestic Problem: The Politics Behind the World’s Most Powerful Number.”

25) Haq, Mahbub. “Reflections on Human Development.”

26) Henry, James S. “The Price of Offshore Revisited: New Estimate for ‘Missing’ Global Private Wealth, Income, Inequality, and Lost Taxes.” Tax Justice Network. July 2012.

27) Johnson, Simon, and James Kwak. “13 Bankers: The Wall Street Takeover and the Next Financial Meltdown.”

28) Johnson, Chalmers. “MITI and the Japanese Miracle: The Growth of Industrial Policy, 1925-1975.”

29) Kertzer, David l. “The Pope and Mussolini: The Secret History of Pius X1 and the Rise of Fascism in Europe.”

30) Library of Economics and Liberty (Econlib). “John Maynard Keynes: 1883-1946.” The Concise Encyclopedia of Economics. 2008.

31) Kevin. “Obama Looks Beyond Commutations in Justice Reform Bid.” CNN Politics. July 15, 2014.

32) Krueger, Alan B. “Economic Scene: The Many Faces of Adam Smith. Rediscovering ‘The Wealth of Nations.’ Aug. 16, 2001.

33) Madrick, Jeff. “Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present.”

34) McKee, Michael, and Mathew Benjamin. “Stiglitz Says Ties to Wall Street Doom Bank Rescue.” Bloomberg. April 17, 2009.

35) Mohaved, Masoud. “The East Asian Miracle: Where Did Adam Smith Go Wrong?” Harvard International Review. Oct. 28, 2014.

36) Nair, Chandran. “Consumptionomics: Asia’s Role in Reshaping Capitalism and saving the Planet.”

37) Opinion. “Not So Super Superfund.” The New York Times. Feb. 7, 1994.

38) Ott, Julia. “Slaves: The Capital that Made Capitalism.” Public Seminar. Vol. 1. Issue 2. 2014.

39) Phelps, Edmund S. “Capitalism and Keynes: From the Treatise on Probability to the General Theory.” July 4-6, 2006.

40) Paley, Dawn. “Drug War Capitalism.”

Columnist: Kwarteng, Francis