It’s Time for a Greater Reset – Crisis Magazine

Discussion of Klaus Schwab and the World Economic Forum’s “Great Reset” usually centers on convincing people who are already convinced that it’s either the only way to save the world or a proposal to finish off what’s left of it. Advocates simply assume it will work. Those opposed tend to say, “Just don’t do it,” or they recommend alternatives ranging from returning to a past that never existed or urging the creation of a future as impracticable as the Great Reset itself.

What Pope Pius XI called a “restructuring of the social order” as an application of Catholic social teaching, however, offers a greater reset than anything imagined by proponents or opponents of Schwab’s plan. Applied social justice is the only realistic and viable alternative to the WEF’s proposal—which presents a serious difficulty. What is “Catholic social teaching,” and what do we mean by “social justice”?

While the Church’s social teachings have always been implicit in the Magisterium, it was not until the early nineteenth century that they developed into a specific discipline. This was in response to the rise of the “New Things”—rerum novarum — in the wake of the French Revolution and the Napoleonic Wars. Newly revived heresies offered a different vision and versions of Church, State, and Family to replace what some considered outdated concepts of God and man.

Many of the proposed reforms anticipated the Great Reset, which can accurately be described as the latest incarnation of what Fulton Sheen called a “Religion without God.” We see this, for example, in what Claude Henri de Rouvroy, comte de Saint-Simon, called “the New Christianity” in his 1825 book, Nouveau Christianisme.

According to Saint-Simon, who was one of the sources for Msgr. Robert Hugh Benson’s apocalyptic novel Lord of the World, the day of traditional Christianity was over. The Democratic Religion, soon to be called “socialism,” would take its place. A Subservient Becoming would replace the Supreme Being. A secular theocracy ruled by an Industrial Hierarchy would direct all efforts of society to material well-being, concentrating on eliminating poverty.

Socialism had its counterpart within traditional Christianity. Eventually termed “modernism,” under the leadership of l’abbe Hugues Félicité Robert de Lamennais the New Things began subverting the Church from within. Rejecting the validity of individual human reason with his “theory of certitude,” de Lamennais declared that only the collective, not individual human persons, can come to certain knowledge of God’s existence and of the natural law.

The theory of certitude was a direct attack on the dignity of the human person and thus in conflict with Church teaching. Pope Gregory XVI therefore issued the first and second social encyclicals, Mirari Vos in 1832, and Singulari Nos in 1834, to correct the problem. The latter, “On the Errors of Lamennais,” is notable for the first use of the term rerum novarum, “New Things,” for socialism, modernism, and the New Age.

Sadly, de Lamennais’ ego was exceeded only by his ire. Alexis de Tocqueville once described him as having “a pride great enough to walk over the heads of kings and bid defiance to God.” Outraged at Mirari Vos, he repudiated his priesthood, renounced Christianity, and founded his own “Religion of Humanity,” with society as god and himself as supreme head.

De Lamennais’ influence in the Church remained strong, however. He is considered the first modernist as well as the proto-Catholic socialist. To deal with the problem, Pope Pius IX issued encyclicals, the 1864 Syllabus of Errors, and called the First Vatican Council.

Still, de Lamennais’ errors continued to spread, even after Pope Leo XIII issued his landmark encyclical Rerum Novarum in 1891. This offered an alternative to socialism’s abolition of private property and a bulwark against modernism. As Leo declared in § 46, “The law. . .should favor ownership, and its policy should be to induce as many as possible of the people to become owners.”

Unfortunately, not being infallible in finance as in faith and morals, neither Leo nor subsequent pontiffs suggested a just and financially feasible means by which people without existing savings could become owners. Most people just assumed Catholic social teaching “really” calls for higher wages, better benefits and conditions, and redistribution, not widespread capital ownership—in short, Schwab’s Great Reset.

A practicable means whereby everyone could own capital without redistribution or redefining ownership à la the Great Reset would not appear until a lawyer-economist named Louis Kelso studied the problem and came up with the answer. Kelso noted that traditional methods of finance assume as a given that the only way to save and thus purchase capital is to cut consumption and save. As capital instruments became increasingly expensive, this limited ownership of virtually all new capital to the already wealthy.

As an expert in corporate finance, however, Kelso knew most corporations typically finance growth not out of past reductions in consumption but with future increases in production. Instead of accumulating piles of cash and purchasing new capital, corporations borrow money, purchase new capital, and repay the loan out of “future savings”: that is, future increases in production.

Further, Kelso also knew that commercial and central banking were invented to turn future production into money to finance growth now. This freed the economy from the necessity of creating money out of existing unconsumed production.

Kelso reasoned that if big corporations can finance growth out of future savings, so can everyone. Instead of using existing wealth as collateral to secure a loan of newly created money, commercial insurance would allow everyone to be creditworthy and gain access to the means of becoming a capital owner.

To apply his theories, Kelso invented the Employee Stock Ownership Plan (ESOP). The ESOP has turned millions of workers in thousands of companies into part owners of the companies that employ them without, in most cases, using past savings or reducing pay or benefits.

The ESOP, however, was only part of Kelso’s vision. Ultimately, his goal was the same as that of Leo XIII: make everyone a capital owner. What Kelso added was to make Catholic social teaching effective by providing a sound and proven method of financing a program of expanded capital ownership.

That makes all the difference. For two centuries, people have tried to circumvent what Kelso called “the slavery of savings” by abolishing private property as a right based on human nature. Socialism, Keynesian economics, and now the Great Reset are and have always been attempts to change human nature, and thus the Nature of God reflected in humanity.

The goal has been to create a new world order that glorifies the collective at the expense of individual human dignity and replaces the transcendent God with an immanent divinized society. What has resulted is hardly surprising. The State has abandoned its natural-law basis and gained power beyond all bounds. Organized religion has ceased to be a factor in many people’s lives. Marriage and family have become the exception rather than the rule in many areas.

That is why we don’t need Schwab’s Great Reset, or any other variation of the New Things by any name. We need a greater reset, or—more accurately—a return to a more personalist social order based on respect for the dignity of every human being, without exception, and that secures the natural rights of life, liberty, and private property to all.

Leo XIII and subsequent popes have insisted on the importance of private property for a just social order because, as Daniel Webster noted, “Power naturally and necessarily follows property.” With capital ownership, people have the power to exercise rights and become virtuous. Without ownership, they remain children or become slaves.

A greater reset, therefore, must be consistent with the natural law and Catholic social teaching. It must also integrate adequate financing as well as equality of opportunity and access to the means of becoming owners of advanced technologies, or any other productive asset, including small farms and artisan businesses if people so choose.

One viable greater reset is the “Economic Democracy Act” proposed by the interfaith Center for Economic and Social Justice in Arlington, Virginia. Based on principles endorsed by President Ronald Reagan and encouraged by Pope St. John Paul II, the EDA applies CESJ’s “Just Third Way of Economic Personalism” through ownership and monetary, tax, and legal reforms to encourage maximum feasible participation by as many people as possible in a justly structured common good while enhancing the individual life of virtue.

[Photo Credit: Getty Images]