Vatican's Plan to Stabilize the Global Financial System Is Unrealistic
Last week, the Vatican’s Pontifical Council for Justice and Peace released a document explaining the breakdown of the global economic structure. Most notably, the document requested the reorganization of the international financial system. The text, “Toward Reforming the International Financial and Monetary Systems in the Context of a Global Public Authority,” calls for the creation of a global authority to monitor the financial system, a central international bank, and global reserves capable of providing necessary aid to countries in crisis.
While the proposal is ambitious and admirable, the recommendations, based on Christian teachings and ethics, are currently unrealistic. The solutions proposed encourage countries to diminish their focus on national issues and adopt a more global perspective, concentrating on international solidarity, reducing global wealth disparities, and advocating the common good.
The document desires to establish solidarity and equality between developed and developing countries. The text suggests that international organizations committed to overseeing the international financial system, such as the 1944 Bretton Woods agreement and the IMF, are no longer capable of stabilizing the global markets. To rectify this problem, a new international organization must be created. Each country will transfer a portion of its power to a supranational authority. This authority will direct international economic policies and retain universal jurisdiction. The creation of an international economic system that requires equal power sharing between all countries, especially between developed and developing countries, is inconceivable to the wealthier states who enjoy controlling and directing economic policy on a grand scale. Although the G-7 has taken great steps to evolve into the G-20, the wealthy, developed countries are a long way off from acquiescing to a global authority, especially when national interests are at stake.
The proposal directly links the free market system to social development and the common good. In addition to guiding economic policy, the authority aims to inspire social advancement and reduce inequality between developed and developing countries. This is an important issue that evokes altruistic sentiments and speaks to a universal vision for humanity. However, economic decisions are often made independently of social justice considerations and aspire to maximize wealth and ensure a competitive edge. While advances in international social development are necessary and important, they will not be achieved at the expense of states’ national economic growth.
To achieve these goals, the document suggests the United Nations serve as a guide until a future date when the authority is well established and can function independently. To date, the United Nations is the best example of the international community working together to overcome developmental challenges, respond to crises and conflicts, and provide basic necessities, education, and health care to those in need. However, the Security Council dominates this system, often hindering progress in favor of political alliances, national special interest groups, and personal security. Although the proposal intends to avoid these tendencies through a gradual formation of a new economic system, its inception into the international arena via the United Nations erodes its ability to begin as an organic and impartial entity.
Currently, the document is a refreshing and invigorating addition to public debate. The proposal is truly commendable and many of the recommendations would provide economic stability and development; however, its assertions remain improbable at this time.
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