CHICAGO (USCatholic.org)—While the economic outlook going into 2009 appears bleaker by the day, a Catholic economist and theologian says the current crisis has already yielded profitable discussion about the role of morality in the markets.

Current economic data shows that the United States is headed for or already in a significant recession. This will likely mean tighter budgets and greater unemployment for American families, even if the $700 billion federal bailout helps the banking industry recover, according to Daniel Finn of St. John’s University in Collegeville, Minnesota. While those with greater job security should be able to ride out the recession, he says, the unemployed, the poor, and the least-skilled—our nation’s most vulnerable—will pay the highest price.

If there’s any good news that can be ascribed to the current chaos though, it’s that this recent market failure has created an opening for Catholic social teaching to be heard on economic issues, says Finn. “There’s room for [this conversation] now in a way that there couldn’t have been even six weeks ago,” he says, noting that more doubt about America’s “free” market system has been created by the upheaval.

Both as a Catholic and an economist, Finn says that the widely accepted philosophy of a free market—with its reliance on an absolute minimum of regulation—allowed the economy to develop in ways that now threaten overall economic well being. Even Adam Smith didn’t endorse a completely free market, Finn says, and Pope John Paul II spoke of the important role of the “juridical framework” or legal structure within which the economy must exist.

Markets and individual initiative are crucial for the creation of wealth, Finn says, “but not every deal needs to be allowed.”

Catholic concepts like the common good and solidarity with the poor should affect the way any market is run, Finn says.

Finn co-directs a project called The True Wealth of Nations (TWN) for the Institute for Advanced Catholic Studies. The project asks: What would an economy look like if it applied Catholic social thought?

Such an economy, the group  proposes, “could put us on a path to true prosperity for all.”

While TWN looks at economic structures in the light of moral reasoning, the American consumer lifestyle also contributes to both financial and moral worries. Consumers won’t be able to create more business activity during the recession by spending, Finn explains, because “much of our recent prosperity has already been based on excessive consumer debt.”

While consuming more responsibly is good for people spiritually and fiscally, as a social scientist, Finn doubts that individual efforts to consider morality in purchasing decisions will make a big difference structurally. “Yes, there’s a lot we could do to be more responsible and it’s important to do that, but we need systemic change as well,” he says.

©  2008 U.S. Catholic/Claretian Publications