Alejandro Chafuen – the Acton Institute’s Managing Director, International – delivered the following address while receiving the 2018 “Premio Juan de Mariana” at the Intituto Juan de Mariana in March. – Ed.
At the end of November, the Acton Institute organized one of the most successful events in the history of the Pontifical Gregorian University. The theme was globalization from the perspective of past Jesuits, as well as many other aspects of a free economy. I had to talk about my favorite Jesuit, Juan de Mariana. The most famous Jesuit of today, my compatriot Pope Francis, did not attend, but a good part of the academic leadership of the Jesuits was present.
A few months later, I had to make a presentation at the Council for National Policy, the policy association that brings together U.S. conservatives who favor the free market and has more convening power. They asked me to focus on the three main criticisms faced by supporters of economic freedom.
I showed these two presentations to Gabriel Calzada (the founder and president of the Instituto Juan de Mariana), and he suggested that I try to combine these two, 30-minute messages into one, 15-minute message. I accepted the challenge, and here it is.
There are many opinions of Juan de Mariana which, if they had been written by any of us, would cause others who support liberty to rend their garments.
The figure of Juan de Mariana seems ideal for this after-dinner talk. My first point will deal with the division that exists between today's “liberal tribes.” Except for this illustrious Jesuit’s writings on monetary issues – which, according to Lucas Beltrán, “not even the most doctrinaire and rigorous liberal will find anything objectionable” – there are many opinions of Juan de Mariana which, if they had been written by any of us, would cause others who support liberty to rend their garments.
Take, for example, his views on issues of defense and security. While on the one hand he pointed out that there is “nothing better than peace,” and how dangerous it is to embark on wars, on the other he said that periodic wars help to form character.
He was very concerned about inequality, favoritism, and other issues that, for a long time, supporters of liberty neglected.
Mariana saw international trade as an almost providential process that led to social cooperation. But he was open to charging higher taxes on goods that he considered luxurious or unnecessary.
He states that God created man naked and weak so that “he would need alien succor and the cooperation and assistance of others” (The King and the Education of the King). Mariana wrote that, from this trade and collaboration among men, “goods as precious and estimable as humanity and laws were born: with these the common life is made more pleasant” (Ibid). But, at the same time, there is nothing that cannot be corrupted. Mariana wrote, “The passage of time and the malice of men introduced such a pile of laws, that already in this day we suffer as much with their multitude as we do from vices.”
Although we may differ about the appropriate degree of limited intervention in the economy, defense, social issues, and religion, here we are, representatives of various liberty supporting “schools,” from classical liberals to anarcho-capitalists, being brought together by an association that bears his name.
Think tanks: Heartless corporate apologists?
Let's move on to the criticisms that others make today about our ideas concerning economic freedom. They criticize us as heartless defenders of unfair inequalities. In the United States, where many of the think tanks have multimillion dollar budgets, we are also accused of being in the pockets of large companies and entrepreneurs.
Let's address the first point: Is it true that non-interventionists are colder and have less compassion for those who have fewer economic opportunities? Are we more selfish?
"I would like to be bought-and-paid-for. Unfortunately, I am donated."
The first time I heard an expert on liberty talk about this topic was 30 years ago, at the Philadelphia Society – a kind of American Mont Pelerin Society, founded in 1964, which I had the honor of presiding over last year. The expert was Eric Mack, a philosophy professor at Tulane University. His argument was that we do not have a genetic predisposition against the poor, but that our ideas of how poverty is overcome can make us less sensitive to the suffering of others in the short term. The way some of us use macroeconomics to prove that if we do nothing – laissez-faire, laissez-passer (“let do and let pass”) – in the long term, we will all be better can make us appear as Keynesians in reverse. Keynes wrote that in the long term we will all be dead; we say that in the long term, we will all be well.
Another issue concerns trade with totalitarian countries in which their prices are totally artificial. One famous example involved communist Poland, which had no golf courses yet began exporting motorized golf carts at predetermined artificial prices that threatened all U.S. producers. I imagine that several in the audience would have recommended that the U.S. government do nothing. After all, the consumer will benefit. In the long term, we will all be better.
Juan de Mariana was not indifferent to the poor. The invisible hand of the market was not enough. He would have liked people to give generously to support the poor and create enough charitable organizations to assist all the poor and homeless. But since he doubted this would happen, he recommended forming various forms of institutions to help orphans, the elderly, the homeless, and the sick. Like John Locke and many authors held in esteem by those who love liberty, he recognized that God created the riches of the world for all, but that after Original Sin, private property was essential.
Juan de Mariana shared many moments with friends of considerable wealth. But he clarified that one of the functions of the prince was to ensure that economic power and riches are not accumulated in a few hands. To this end, he did not propose wealth redistribution but the strengthening of commerce and industry by an economic policy of low taxes, fewer obstacles to production, and healthy companies.
He was very concerned about corruption and favoritism. He said:
- “How sad it is for the republic, and how hateful for the common good, to see many enter the administration of public revenues poor, without any income, and see them after a few years happy and opulent!”
- “What is said, and what is seen, is miserable. It is said that in recent years there is no office or dignity that is not sold by the ministers with gifts and bribes, etc., up to the royal courtrooms and bishoprics. It must not be true, but it is miserable that it is said. We see the ministers out of the dust of the earth in a moment charged with thousands of duchies of rent. Where did this come from but from the blood of the poor, from the entrails of businessmen and suitors?”
To stop some of these abuses, Mariana recommended that all the officials of the king present the inventory of their assets before taking office. Public officials should be audited frequently, and the inventory would serve “so that at the time of the visit, they would often realize how [the officials] have won the rest” of their fortunes.
This problem came about, in part, because those who held public office came to power so indebted that they felt obliged to unjustly favor those who “secretly greased their palms.” Corruption was so great (“the bribes and swindles would not be counted,” Mariana said) that, of each peso destined for the royal treasury, only half reached the hands of the king. Since each note passed through many hands, it would “leave something in each part.”
Close to the subject of corruption is cronyism: capitalism (or socialism) restricted to cronies. Cronyism usually leads to unjust inequalities, often brought about illegally. These most often consist of immoral actions that will shut out competitors who have more talent but less access to political power.
I have friends, however, who tell me that crony capitalists are not capitalists. But I think that this position makes us appear dogmatic and disconnected from reality.
Unfortunately, we do not have good measures for this phenomenon. It occurs to me that cronyism must have a high correlation with the indices of transparency and corruption. Juan de Mariana did not say that the Jesuits who squandered resources, or the religious who lived in opulence, were not Jesuits or religious. I have friends, however, who tell me that crony capitalists are not capitalists. But I think that this position makes us appear dogmatic and disconnected from reality.
All the justice indices show that, in more than two-thirds of the world, there is no equality before the law and there is no rule of law. It is extraordinarily negative to be almost blind to the economic injustices that this framework produces.
Besides the allegation that we are not worried about unfair inequalities, our critics often accuse us of being in the pockets of big companies and the rich. I know of the insignificant funds that Spanish think tanks receive in donations. In the United States, large think tanks such as the Heritage Foundation or the Cato Institute – and even the Acton Institute or the Atlas Network – receive less than three percent of their income from the corporate world. We usually depend on people who donate from their own pockets or their family foundations.
When critics accused a great friend of several of us, Armando Ribas, of being a CIA agent because he defended capitalist ideas, he used to say: “I would like to be bought-and-paid-for. Unfortunately, I am donated to the CIA.” And many of us are donated to the world of big business. We work to create a favorable climate for production, but many times we strive in our vocation without much outside support.
I have no doubt that Juan de Mariana, if he were here with us, would be very much in favor of what think tanks do, as well as the efforts some of you make as independent intellectuals or professors.
Would he be happy with the work done by the institute that bears his name? Almost certainly. But I would also make constructive criticism – as he offered critiques, as a member, to his beloved Society of Jesus. I think he would have appreciated the institute's courage to tackle difficult issues in the social, political, and economic fields – and maybe also the courage to reward someone who, like him, defends religion, traditions, family, and the importance of national defense.
Thank you for this gift and for your work in favor of the human person and the free society.