Rerum nuvarum was essentially a defense of the rights of the working man combined with a vigorous condemnation of nineteenth-century socialism. Forty years after the encyclical Quadragesimo anno came closer to articulating a positive Catholic view of an organic society in particular by laying out the three cardinal principles of Catholic social theory: personalism, subsidiarity, and pluralism. Personalism insists that the goal of the society is to develop and enrich the individual human person; the state and society exist for the person and not vice versa. Subsidiarity insists that no organization should be bigger than necessary and that nothing should be done by a large and higher social unit than can be done effectively by a lower and smaller unit. Pluralism contends that a healthy society is characterized by a wide variety of intermediate groups freely flourishing between the individual and the state.
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The remote origins of the high Catholic social-theory tradition can be found in the work of the medieval theologians both as they reinterpreted the Aristotelian views of the nature of human society and as they sought for a definition of the state to clarify the issues in the Church-state controversies of the late Middle Ages. However, the articulation of a formal Catholic social theory by the Church began only in 1891 with the publication of Pope Leo XIII’s encyclical Rerum novarum (On the Condition, of the Working Classes).
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Finally—and this may be the easiest way to tell the Catholic social theorist from the socialist and the capitalist—he is profoundly suspicious about size. Just as the capitalist in principle and the socialist in practice thinks larger is better, so the Catholic theorist can only respond that small is beautiful. Of course, one must avoid the romantic temptation to assume that small is invariably beautiful or better. A hundred people cannot support an airline, a country of small farmers cannot produce enough food to feed the world—or even one large industrialized society. “Too big” is not an absolute matter but a relative one, and from the perspective of the Catholic social theory something becomes too big when it is bigger than it has to be to do the job. The principle of subsidiary function is perhaps the central theme of Catholic social theory. It vigorously argues that nothing should be done by a larger organization that could be done as well by a smaller one; and nothing should be done by a higher bureaucratic level that can be done just as well by a lower level.
Perhaps the mistake of much Catholic social theory in the past was to argue as though the principle of subsidiarity was a philosophical deduction rather than an empirical observation. You keep things as small as you possibly can because they work better that way, there is more flexibility, better communication, more room for innovation, adaptation, and quick response to new problems. You decentralize decision-making as much as you can because those who are responsible for carrying out decisions participate in the decision-making process and because their motivations to see successful implementation will be much stronger. These are not merely ethical principles; they are empirically documented facts. Such facts are ignored today in the organization and administration of corporate bureaucracy, which merely proves that the blinders of ideology and habit can filter out critically important information. In the short run, giantism is efficient. You can maximize production quickly with “economies of scale.” The only trouble is that the corporate organization is made up of more than just machines; it is also composed of human beings, and in the long run, economies of scale easily lead to diseconomies of human effectiveness. This fact has been proven time and time again, but it still does not seem to have sunk into the thinking of the theorists of either corporate capitalism or corporate socialism.
Catholic social theory would also argue (here with an approving nod to the Volvo experiments) that no matter how large the organization, it is immoral, erroneous, and foolish to treat it as though it were made up of atomized, isolated individuals. Even if you bring a group of complete strangers together to operate your plant, those strangers will set up informal social networks during the course of the first morning. Soon they will run the factory, not you. Also, you may drive the peasant out of his old village and set him up in a clean, new, efficient agricultural commune, and you may even threaten him with death if he doesn’t live up to your standards of productivity, but that does not mean friendship networks will not emerge to deftly and subtly sabotage the goals set for you by the Central Planning Board in Peking, Havana, or Moscow. From the perspective of Catholic social theory, it is not a question of an organization without Gemeinschaft but rather an organization that recognizes and works with it.
The Catholic social theory differs from capitalism and socialism, for example, in its view of individual and class conflict. Capitalism and socialism assume that in the natural state of things individuals and classes are in conflict. In the capitalist society the state is the organ of the ruling class (though capitalists would be reluctant to admit that quite so explicitly); in a socialist society the state allegedly becomes the instrument of the oppressed class against the ruling class (though in fact it usually becomes simply a tool of the New Class). Both theories are uneasy about conflict within their own societies. Social and political unrest, or even too much diversity, is viewed by the capitalist as a threat to the stability of his society and the maintenance of high levels of productivity. The socialist, once he has gained power, considers political opposition to be counterrevolutionary and vigorously represses dissent. Both socialist and capitalist applaud conflict and competition in theory and do their best to repress it in practice —perhaps because both are impressed by the inherently unstable nature of human social institutions.
The Catholic theory, on the other hand, is much more relaxed about the stability of human institutions because it views them as based on the dense and intimate interpersonal networks of “lesser groups,” which it takes to be the raw material of society. Since these lesser groups (family, local community, friendship circle, local church, neighborhood, etc.) are normally more cooperative than competitive, the Catholic social theory assumes a matrix of much greater social cooperation than do its two individualist social theory adversaries. Of course, even within much smaller groups there is competition (between husband and wife, parents and children, poker players and bridge players), though the competition rarely destroys the cooperative structures. Catholic social theory assumes that such competition is normally more healthy than not and is not greatly disturbed by it.
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Catholic social theory looks at American society with the preliminary assumption that almost everything is too big. It would insist on far more rigorous interpretation of the antitrust laws—and far quicker implementation of them. It would advocate an upper limit on the size of all educational institutions—in particular, universities—and demand that the present multiversities be broken up administratively into independent component colleges. (If it works at Oxford and Cambridge, why not at Berkeley or Champaign-Urbana?) It would shift the obligation of proof not on those who are against larger size but on those who are in favor of it. You would have to prove beyond any doubt at all that an increase in the size of an institution would make it both more efficient and more humane. Catholic social theory would insist that the assumption is against size until the contrary is proved.
It would want to see a significant segment of the national resources devoted to experiments with decentralization and the breaking up of the musclebound, tongue-tied, barely breathing corporate giants. Nothing should be done in a neighborhood parking lot that could be done just as well in the backyard; nothing in the small factory that could be done just as well in the parking lot; and nothing in the large factory that a small one could handle; nothing by a conglomerate that an independent firm could do just as well. All the dynamisms of capitalist and socialist bureaucracies alike go in the opposite direction. The research evidence may indicate that small is not only beautiful but also effective and efficient; yet day-to-day practice proceeds on the basic assumption that big is better, however discredited this assumption may be. Catholic social theory should be arguing that the only way the trend can be reversed is if experiments such as new approaches to automobile construction (pioneered by Volvo) are proved to be at least as efficient and probably more efficient than giantism. For all practical purposes, since giantism currently is in complete possession of the economy and the society, those who believe in decentralization and smallness and subsidiarity are going to have to prove that their way is not only efficient but more efficient; they are going to have to carry the day by beating the centralizers at their own game, by establishing that greater productivity and more money can be made by treating individuals as persons and not as cogs in a machine. The Catholic social theorist believes in principle that that is so. It is time for him to acquire the technical skill that he needs to demonstrate how his principles might be effectively applied in practice. Indeed, the greatest single obstacle at the present time to a serious consideration of a Catholic social theory as an alternative to capitalism or socialism is that the Church simply does not have available the technical or the professional competence to demonstrate how its implicit, often unselfconscious view of human nature and society can be applied in practice to the world as we now know it. Perhaps the reason why Catholic social spokesmen settle for romanticism or Utopia or anger at the United States is the realization that they are simply incapable of saying how someone might apply the Catholic world view to the practical realities of every day economic and social living. Utopias come much easier than getting the kind of training and experience you need to know what you’re talking about.