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Religious activists are more outspoken than ever about the problem of global poverty. So, why do they so often and so energetically attack multinational corporations, the very organizations that are helping developing nations create jobs and grow through broader trade relations?

To a certain way of thinking in religious circles, large global corporations are often perceived to make excessive profits, exploit the poor, damage the environment and exercise undue influence on governments — especially struggling democratic nations in the developing world. In many ways, these companies are visible and easy targets for the anti-globalization crowd.

If the material living conditions of the poor are the main criterion, religious leaders should be arguing for more, rather than less, globalization. By that, we mean the inclusion of developing countries in the global economy and lower barriers to their participation in international trade. It would most probably also mean increased investment by multinational corporations in developing countries. In order to compete for these investments, developing countries need to provide an attractive climate by fighting corruption; establishing good banking and legal services; and ensuring basic education, health care, and infrastructure. These improvements would increase transparency and accountability, and benefit society in general.

But recent anti-business campaigns by religious activists would lead one to conclude that the cure for poverty involves attacking large companies. For example:

  • A December 2005 letter signed by several dozen religious leaders, including Jesse Jackson and the president of the United Church of Christ, took the CEO of Walmart to task for paying “poverty level wages.”  “Walmart needlessly ignores the Golden Rule putting our children and their workers needlessly at-risk,” the religious leaders wrote;
  • In February 2002, the now-retired Roman Catholic auxiliary bishop of Detroit, Thomas Gumbleton, and a Methodist Bishop, Jesse DeWitt, wrote to the CEO of Disney and called for better working conditions at a garment factory in Bangladesh. The conditions at the factory actually did improve, but Disney's contractor subsequently halted operations there, prompting another letter in December 2002, this time from the superior general of the Marianists, a Roman Catholic religious order, urging Disney to return; and
  • Then there's the long-running campaign against Coca-Cola in India, criticizing the beverage manufacturer for not listing pesticide residuals on labels and for allegedly draining and polluting local water supplies. Government officials reacted to these latter, unproven claims by shutting down a bottling plant in the southern state of Kerala in March 2004. The company has also been attacked for quality-control problems in Europe and labor practices in Columbia. The anti-Coke campaign has been supported by a social action fund of the Unitarian Church and Union Theological Seminary in New York, which banned the sale of Coca-Cola products on campus in April 2005.

The very concepts of business and profit motive are often reason enough for religious leaders to condemn an activity as immoral and unethical, and criticisms of multinational corporations are just the same condemnations on a larger scale.

Even if the necessity of market economics is granted by some religious groups, few seem to appreciate how business activity and work are actually good for human beings. People spend most of their waking hours on the job, and people of faith can learn to see their particular occupation as their vocation in life, no matter the type of work.

Does size matter? Not really. It is now well-established that multinationals tend to treat workers better than domestic employers in developing countries. (See, for example, the National Bureau of Economic Research Working Paper 8299 of May 2001 and numerous studies by the OECD, such as Trade, Employment, and Labour Standards of 1996.) China and India are two prominent examples of countries that have greatly reduced poverty as a result of opening up their economies. From the perspective of developing countries, it is much worse to be ignored by multinational corporations than to work for them.

A dose of realism may also be in order. For all the good things it brings, increased commerce will not result in a perfect society. There will always be some forms of inequality, leading to resentment and class divisions, while materialism and alienation can be commonplace in commercial societies — as they were in socialist planned economies. Moral education is vitally important, as there can be no good society without good human beings. But if religious leaders must address economic issues, a little more economic literacy is necessary.

Kishore Jayabalan is director of Istituto Acton, the Acton Institute's Rome office. Formerly, he worked for the Vatican's Pontifical Council for Justice and Peace as an analyst for environmental and disarmament issues and desk officer for English-speaking countries. Kishore Jayabalan earned a B.A. in political science and economics from the University of Michigan, Ann Arbor. In college, he was executive editor of The Michigan Review and an economic policy intern for the U.S. Chamber of Commerce. He worked as an international economist for the Bureau of Labor Statistics in Washington, D.C.