Beyond the Financial Crisis, Towards a Christian Perspective for Action, Paul Dembinski and Simona Beretta, The Caritas in Veritate Foundation Working Papers, June 2014.
The financial crisis and its many developments have brought to the forefront a sea change most people were unaware of in 2008. The financial economy had from the mid-1980s overtaken the real economy and expanded so much to become pervasive. All kinds of goods and commodities are transformed into financial assets or securities and sold on global exchanges. Especially debts—consumer credit, mortgages, credit cards, etc.—were appealing. Thus, over the last three decades financial assets became increasingly and silently part of our everyday life. So much so, that a total collapse of financial markets would actually be akin to a reboot of our way of life and of most of our institutions.
This working paper addresses this change and gives a well-developed and informed understanding of how we came to this. But most of it is dedicated to another point: which path is open today out of the crisis? What lies beyond the crisis? The return to ‘business as usual’? Have we learned nothing?
Financial markets are not evil per se. They do have a social function, but must work for the Common Good if they want to earn to it. What does this concretely mean? Drawing upon Catholic Social Teaching, Paul Dembinski and Simona Beretta reassert forgotten truth and explore new and challenging perspectives.