“To help the poor, study economics”: income inequality, justice, and economic theory
In Part 1, I described the current staggering growth of income inequality, and how the forces creating it are also endangering the climate of our island home. Part 2 discussed the failures of economic theories to guide leaders and the rest of us in making not only overall policies but even decisions each of us needs to make financially.
In this Part 3, I will introduce one little-known theory, that of Bernard Lonergan, who proposes a real science of economics, which, he argues, must incorporate a moral perspective if it is to be at maximum efficiency.
“Bernard J.F. Lonergan is considered by many intellectuals to be the finest philosophic thinker of the 20th century.” — Time Magazine, April 20, 1970.
“To help the poor, study economics” is the saying I keep quoting attributed to Lonergan. Best known for works such as Method in Theology, Insight, and Doctrinal Pluralism, it may come as a surprise that Lonergan himself considered his work in economics to be his most important life’s work. In fact, toward the end of his life he taught economics at Boston College.
As a young Jesuit assigned in 1930 to working in Montreal among the new poor created by the Depression (some of whom he knew personally), Lonergan began to study economics, convinced that a general lack of understanding of the laws of economics had precipitated the crisis. Furthermore, without a real science of economics, recessions, depressions, and crashes will continue to occur over and over. His economic work continued over 50 years, ending only shortly before his death in 1984.
As part of an effort to publish the collected works of Lonergan, several of his students gathered and edited his unpublished manuscripts into two works, For a New Political Economy (FNPE) and Macroeconomic Dynamics: An Essay in Circulation Analysis (MD). FNPE opens sounding a bit like Piketty:
In the introduction to his General Theory, Mr. Keynes considers the objection that only the more intelligent type of expert is able to understand the highly abstract theorems of…