“The dignity of each human person and the pursuit of the common good are concerns which ought to shape all economic policies.” -Pope Francis
Pope Francis is worried the world economy is on the verge of collapse. Like a canary in a coal mine, he points to the depressed economic condition of youth as a key indicator of this impending collapse. The Pope states, “We discard a whole generation to maintain an economic system that no longer endures.” What has led us to this dire prediction and what can we do to avert it?
This much is clear: the economy is going through a fundamental realignment. Don’t believe me? Let’s take a look at how some of the key industries have changed from the beginning of the last century and into the 21st.
No other industry has experienced a more profound change than agriculture. At the dawn of the 20th century, 41% of the nation’s workforce was employed in agriculture. By 2000, it was less than 2%.
Since the Great Depression, the farm industry has been subsidized and insured by the government. Whether it’s a good or bad harvest, the industry receives what amounts to a government handout. Take Cargill Inc., for example. Cargill is the largest food producer and distributor in the United States. In 2011, Cargill brought in $109 billion in revenue–an 8% increase from the previous year. As of 2013, revenue reported was $136 billion. Yet still, the richest farm subsidy recipients—companies like Cargill—receive nearly three-quarters of the payments.
In 2012, it was estimated that 40% of the nation’s food supply was wasted. That amounts to over $165 billion a year in waste. Why then, if we’re subsidizing a flourishing farm industry and wasting tons of food, do 16 million American children struggle with hunger?
In the 1950s, the auto industry was king. The Eisenhower Interstate Highway System was being built and Americans were excited to hit miles of open road. By 1960, about one-sixth of the American workforce was employed directly or indirectly in the industry.
Today, the city of Detroit is bankrupt and auto dealers are offering sub-prime loans to consumers with poor credit and/or very little disposable income in order to get cars off the lot. This practice could very well lead to an auto-loan bubble. For example, a 60 year old man, who stopped working in 1991, declared bankruptcy, and currently lives on Social Security, was approved for a loan of over $15,000 to buy a used car. Why on earth did the bank think giving out a loan of that size was a good idea? Based on recent experiences, the average taxpayer and consumer, not banks or Wall Street, will likely feel the pain if this bubble bursts.
Speaking of bubbles, while the housing sector has largely bounced back from the recession (at least in certain parts of the country), we are unlikely to ever see the boom experienced after World War II again. The post-war housing boom saw thousands of returning GIs buying suburban homes in places like my hometown, Levittown, Pennsylvania.
In 2010, one-fifth of homes in the United States were vacant despite the fact that many were in perfectly good condition. Instead of providing 3.5 million homeless Americans with proper shelter, homes are being left vacant or worse—demolished.
Additionally, there are an estimated 11 million Americans at risk of foreclosure, yet little to no relief is coming from the government or banks. Instead, banks are more interested in building and selling homes than protecting the investments of existing homeowners.
All of this begs the question: has the labor of our forefathers uplifted and improved our lives? Absolutely. But the drivers of economic growth and shared prosperity in the 20th century aren’t working for the majority of people in the 21st century.
It’s no secret the existing economic system relies on nonstop consumption and competition. We’re constantly bombarded with advertisements on the internet, television, radio, phone, highway, etc., trying to get us to buy things we don’t need. From the agricultural to the automotive to the housing industry, there’s a relentless quest to increase demand, pushing Americans to consume beyond the limits of what is reasonable. To be sure, there will be other industries to replace these industries, but not on the size and scale enjoyed during the economic peak of the 20th Century.
While its true automation has allowed greater leisure, that very same automation is now a principal actor in depressing wages and increasing unemployment. According to a study released last year by the Oxford Martin Programme on the Impacts of Future Technology, about 47% of US employment is at risk of automation. The study, and others like it, has failed to convince policymakers from amending the current economic system to better reflect changing circumstances.
There’s a better way forward. Instead of a system that over-relies on consumption and competition, an economic system that encourages sustainability and cooperation can and should be promoted. As Pope Francis said, “This is one of the greatest challenges of our time: to convert ourselves to a type of development that knows how to respect creation.”
Poverty of material goods will always exist. But homelessness and hunger, the prime factors in preventing a stable family and community, are issues with real solutions. The main barrier preventing us from tackling these issues is the absence of compassion in the way many view humanity. Before advocating new policies, policymakers and citizens alike must adopt a greater commitment to solidarity and inclusion. Love and respect for the worth of others must prevail over indifference and greed. Then, and only then, will the dignity of the human person be more fully realized and appreciated.
Stephen Seufert is the State Director of Keystone Catholics, a new social justice advocacy organization in Pennsylvania dedicated to promoting the common good.