Catholic World News News Feature
Did the Pope predict the meltdown of world financial markets? November 21, 2008
Did Pope Benedict predict the current worldwide financial crisis?
During the past few days dozens of newspapers have run a report suggesting that the Pope had warned about the coming financial meltdown, more than 20 years ago. But more sober analysis shows that the then-Cardinal Ratzinger had something quite different in mind when he made the remarks that are now being cited as a "prophecy."
The claims that the Pope forecast the collapse of world financial markets originated with a November 20 Bloomberg report carrying the provocative headline: "Pope had 'prophecy of market collapse in 1985.' The Bloomberg story quoted Italy's finance minister, Giulio Tremonti, as saying that in an article he wrote in 1985, the future Pontiff made "the prediction that an undisciplined economy would collapse."
Speaking at Milan's Catholic University, Tremonti called attention to a paper that Cardinal Ratzinger had delivered at a 1985 seminar on "Market Economy and Ethics." The future Pope said that a breakdown on moral principles "can actually cause the laws of the market to collapse," the Italian finance minister recalled.
It was the Bloomberg headline, not Tremonti's own words, that gave rise to the suggestion that the paper Cardinal Ratzinger delivered in 2005 contained some sort of economic prognostication. Actually the future Pontiff was making a point that should be familiar to anyone with a passing interest in Catholic social teaching; he was insisting that the working of a free-market economic system must be buttressed by the principles of Judeo-Christian morality.
In a sober analysis of the text that the German cardinal delivered at that 1985 seminar, Jordan Ballor of the Acton Institute supplied the relevant quotation from the Ratzinger text:
It is becoming an increasingly obvious fact of economic history that the development of economic systems which concentrate on the common good depends on a determinate ethical system, which in turn can be born and sustained only by strong religious convictions. Conversely, it has also become obvious that the decline of such discipline can actually cause the laws of the market to collapse.
That statement obviously is not intended as a prediction of particular trends in the world's financial markets; it is a comment on the close relationship between ethical behavior and social welfare, on how the common good is served when individuals base their actions on consistent moral principles-- and undermined when they act selfishly. As the Acton Institute's Ballor put it, the cardinal is warning "about an economy that lacks participants who act from the basis of a serious and committed moral foundation," and his comment is "about a lack of religious discipline as much as economic discipline."