There’s an important article in the recent Our Sunday Visitor by Joseph O’Brien titled Catholic Economists Take Issue with Federal Stimulus Package. The article highlights some economists’ concerns with the recently passed stimulus package, or Economic Recovery and Reinvestment Act of 2009. Both liberals like Alan S. Blinder and conservatives like John Mueller are concerned about the package, though for different reasons.
But the Our Sunday Visitor article is interesting for another reason as well. It describes the important work of John Mueller, director of the Economics and Ethics Program at the Ethics and Public Policy Center in Washington, D.C.
In his forthcoming book, Mueller critiques the classical and neo-classical economic thinking of figures like Adam Smith and Alfred Marshall by claiming it expounds only three of the four basic elements of the just economy. The omission is troubling because it hobbles our leaders’ ability to craft popular and just policies, based as they now are on incomplete understandings of what really comprises an economy.
Mueller sees four areas of activity: production (building, planting, creating), exchange (buying and selling), consumption (eating and drinking), and distribution (as in giving within the family). Policy changes ought to be based on justly serving all four areas.
The article also describes what John Larrivee (who wrote an excellent guest post on the economics of fair trade for the A&M Blog) sees as the need for more ‘moral capital.’ Building on the work of Robert Fogel (see recommended reading on right side, The Escape from Hunger and Premature Death), Larrivee has generated a list of 15 things we need more of, including a family ethic and work ethic, ability to resist hedonism, and greater thirst for knowledge. The enormous prosperity generated by the free economy over the last 300 years has made issues about the quality and quantity of our moral capital more and more important.
We’re getting very good at addressing the challenge of scarcity. What we need is greater understanding of what makes a life well lived.
i just hope that the economy would recover very soon because of the Stimulus Package given by our government
I share the hope that the economy recovers very soon. The record of successful fiscal stimulation of aggregate demand is not a very solid foundation for hope, however, unless the objective is a rise in the general price level.
~ i hope that those Stimulus Package coming from the government would really kick start the Economy. the economic recession has been very bad on my business.
Sorry to hear about the hard times. Amity Schlaes’ book on the history of the New Deal does not provide much hope that federal stimulus packages work. Seems best to let markets adjust, something they do very quickly. Let us pray this recession ends and employment rises!