The decision by the Securities and Exchange Commission to sue Goldman Sachs for fraud has provoked the usual clash of titans: critics and supporters of the one investment bank that made out, pardon the expression, like bandits during the Great Recession. By most measures, they won when almost everyone else lost. Their rivals were crushed. Their leaders appeared to control some of the key levers of federal power. They got record bonuses at the end of our disastrous year.
But now, if the government’s case is to be believed, we discover that they were placing bets against their own offerings, complex financial instruments that they sold to their customers while betting they would fail.
We thought that what happened in Las Vegas stayed in Las Vegas, but apparently it works on Wall Street as well.
Whether the government will win its case is itself a crapshoot, and its track record so far is not good. Apparently the Great Meltdown of the financial markets was no one’s fault, a wonderful convenience for the bonus blessed in what is quaintly called the financial services industry.
But whether or not the government wins its case, the tragically high costs of financial speculation underscores a very Catholic point: What is missing from so much of the discussion these days is a concern for the common good.
Pope Benedict XVI, in his much ignored social justice encyclical, “Charity in Truth,” reminds us of this central virtue: “The more we strive to secure a common good corresponding to the real needs of our neighbors, the more effectively we love them. Every Christian is called to practice this charity.”
Now the Ayn Randians among us preach the bracing value of selfishness, and suggest that concern for the common good is some sort of weakness, to which the pope replies: “What should be avoided is a speculative use of financial resources that yields to the temptation of seeking only short-term profit, without regard for the long-term sustainability of the enterprise.” Many firms who lost sight of this consigned themselves to the ashcan of history, but so many people — pensioners and the soon-to-be retired, small firms and even quite large ones — paid an enormous price for this shortsightedness.
For the pope, fiscal prudence and a concern for the common good is a moral lesson too little learned these days: “By cultivating openness to life, wealthy peoples can better understand the needs of poor ones, they can avoid employing huge economic and intellectual resources to satisfy the selfish desires of their own citizens, and instead they can promote virtuous action within the perspective of production that is morally sound and marked by solidarity, respecting the fundamental right to life of every people and every individual.”
Such virtuous action, the pope is arguing, is part of the moral ecology. It is to be profoundly pro-life.
Apparently the betting is that Goldman Sachs is too big to bring down. It is too powerful and too well-connected. But whatever the outcome, and whatever their reward — at least here on earth — we Catholics are challenged to look beyond the short term and what enriches only us. In fact, we are called by our faith to something much greater and much more demanding. In the bracing words of St. John Vianney: “All of our religion is but a false religion, and all our virtues are mere illusions, and we ourselves are only hypocrites in the sight of God unless we have universal charity for everyone, for the good and for the bad, for the poor people as well as for the rich, for all those who do us harm as much as those who do us good.”
For Catholic business people, politicians and employees, the first lesson of the Church is to work for the betterment of all.
Editorial Board: Greg Erlandson, publisher: Msgr. Owen F. Campion, associate publisher; Beth McNamara, editorial director; John Norton, editor; Sarah Hayes, presentation editor