May 21, 2013
Against liberalism, critic of the IMF and foreign debt
Ambito Financiero staff
Harsh critic of free-market liberalism, the IMF and adjustment policies, and defender of the debt restructuring processes, Jorge Bergoglio, now Pope Francis, never refused to define where he stands when it comes down to economics, even in the most difficult moments. Adept to the most classical conceptions of the Social Doctrine of the Church, he openly confronted adjustment policies during the 2001 crisis, and then, in 2011, he battled those same recipes then intended to solve debt problems in Europe.
Bergoglio took an active stance against liberal policies since his early years, but it became public in 2001 when Argentina went into a terminal crisis. In his sermons, he used to openly condemn the social situation, even with former President Fernando de la Rua sit right in front of him and hearing his Sunday’s Mass.
It was in August 2001 when he submitted a document known as “Episcopal Conference of Argentina”, where the Church indicated its stance before the delicate situation the country was going through.
The document said that "some of the most serious social ills we suffer are a reflection of the raw liberalism.” Likewise, it indicated the State as “an instrument created to serve the common good, and to be the guarantor of equity and solidarity of the people.”
The communiqué also condemned the fact of not having created a “social network” in order to contain the expelled from the system. To conclude, it also remarked the existence of “two diseases: tax evasion and squandering of State funds, which are funds obtained with the sweat and sacrifice of the people.”
Back then (2001), it were times massive pickets around the country, so Bergoglio asked for a moderate use of the right to strike as these kind of protests were becoming “an unfair aggression against the society and can greatly hamper the reconstruction of Argentina.”
The document ended with a direct condemnation to the foreign debt as it “increases every day and makes growth impossible”. Bergoglio insisted with this last topic on numerous times, as he publicly supported the 2005 debt restructuring process.
As a worldwide recognised Church representative and leader of the Pontifical Council for Justice and Peace, he signed along with fellow Ghanaian cardinal Peter Turkson in October 2011 a Vatican’s harsh document against adjustment policies that were beginning to be applied in the European countries in crisis. To put it bluntly, and taking almost the exact same phrases he used for the Argentine document in 2001, now 10 years later, the new document said “the IMF has lost its ability to ensure global financial stability”, and recommended the creation of a new World Central Bank based on “spirituality and ethics.”
One of the functions proposed for this new world entity was the taxation of certain financial transactions to the most developed countries in order to create “a global stockpile to help nations in crisis.”
Bergoglio claimed in that document that “the economic liberalism with no rules or controls whatsoever is one of the causes of the current economic crisis since it creates speculative financial markets, thus damaging the real economy, especially in weak countries.”
Even in certain passages, the document gets close to the “Indignant movement”, which was booming in those days, but asks that the claims should not be based on “screaming, but on reasoning.”
The document, which was specifically requested by nations like Greece, Ireland, Italy and Spain, all countries that were going through the recipes of the IMF and the European Central Bank, based its position in Benedict’s XVI encyclical “Caritas in Veritate”, where the Argentine cardinal also had direct influence from his local experience of 2001.