Pope has authority to talk about economics (Contribution)

Pope Benedict has criticised scientism and the awful influence it has on the world today. Scientism has two aspects.

The first aspect is the theoretical notion that only scientific doctrine and method can lead to truth.

The second is the practical handing of authority to scientists alone.

Pope Benedict's criticisms of both aspects has support in many circles when he challenges scientism in physics and biology but attracts incredible opposition when he wades into political and economic affairs.

Economists seem to be the only people permitted to make sensible statements about political and economic conditions. It is being assumed that the current economic methods are the only rational way to discover economic truth.

In Australia today we have an election battle where neither party has the strength of conviction to say anything that opposes received economic orthodoxy. Rudd challenged the economic orthodoxy and was abandoned by both parties.

Strangely this attitude follows on the heels of the global financial crisis, which was unpredicted by all but the acknowledged unorthodox economists. I would have thought this would damage the reputation if economic orthodoxy but it seems the opposite is the case.

Paul Krugman is an prime example of an economists having failed to predict the GFC and not losing his reputation or influence on socio-economic policy.

The 2008 Nobel prize winner and New York times columnist provided a rather simplistic analysis of where economists went wrong in 2008.

He suggested that economists had preferred mathematical beauty to real truth, they had failed to realise that markets and institutions are not perfect and that people often behave irrationally.

Krugman remains blind to the fact that the economic view of rationality is a stunted and limp view of the real nature of this divine gift.

The Popes have rightly criticised economists for their failure to come to terms with the nature of the human person.

Modern economics was conceived during a time when psychology was at a low point in history.

The mind was little understood and there was a deep suspicion of mental structures.

The Enlightenment's revolt from the middle ages had rejected the faculty view of the soul.

For economics this meant the rejection of notion of a hierarchy of goods and the development of a utilitarian calculus view of rationality.

In more recent times the structured nature of the mind has been rediscovered and the corresponding hierarchy of goods and broader notion of rationality developed. Unfortunately this has not found it's way into economic theory which suffers from sorry origin.

If Krugman is not ready to read Caritas in Veritate, at least he should cross the quad at Princeton and meet philosopher Harry Frankfurt. There he would be introduced to the distinction between first and second order desires.

First order desires such as wanting a cigarette are different from second order desires, which are desires about desires. For example does a person desire to desire cigarettes or in other words, desire to be a smoker?

From this distinction comes a hierarchy of goods. Clearly a person can want, even crave a cigarette and yet also hate cigarettes (because they want to quit).

This would place cigarettes near the bottom of the hierarchy of goods, while near the top will be the things a person cares about and the things they want to take care of those they love.

Such a hierarchy is more powerful and sophisticated than the current needs/wants analysis if modern economists.

Krugman and other economists need to acknowledge that modern economics is in need of a major overhaul.

At the same time we need to realise that the practical scientism that places intellectual authority in the hands of scientists alone is unacceptable.

In particular the Pope should not be the only voice defending the true dignity of each human person.

SIC: CTHNews