1. Introduction
This presentation is an exercise in thinking about economic inequality from the perspective of Catholic social teaching (CST). In doing so, I will discuss the foremost thinker on economic ethics in the history of American Catholicism, Msgr. John A. Ryan, who wrote extensively on the issue of wage justice. Ryan provides an interesting case because he was deeply committed to worker justice throughout his long career, yet economic inequality was not a particular focus of his efforts. I will suggest why that is so, by discussing Ryan’s natural law methodology within the Catholic social tradition that left him less troubled by inequality than he ought to have been. I will then propose that developments after Vatican II have led CST on economic justice to take more seriously the need to address inequality. In closing, I will comment upon the contribution that CST might make to our nation’s discussion about the growing problem of significant economic inequality.
1The expression “Catholic social teaching” refers to a body of literature produced by hierarchical leaders in the Catholic church, popes or bishops, who have tried to address the political, economic, and social implications of Christian belief. How might the various teachings of the Catholic church shape the way that believers respond to social issues? In particular, how does adherence to the Catholic tradition impact how one might think about economic inequality?
In 1891, Pope Leo XIII wrote a document entitled
Rerum novarum (On the Condition of Labor), in which he presented what he saw as the primary social concern of the time, the “plight of the working class.”
2 At the time, the ideology of free contract still had powerful support in the United States. There were none of the social policies of the modern welfare state in place: minimal wage laws, occupational safety regulations, child labor laws, or limitations on the length of the workday or workweek. There were no paid sick leaves, paid vacations or retirement pensions. The movement of organized labor was still in its infancy in the United States.
Leo’s text is widely cited by scholars of CST as the beginning of formal papal social teaching.
3 In that encyclical, a circular letter sent to all Catholic bishops, Leo claimed belief in human dignity and the moral equality of persons to be foundational for a sound view of justice. Workers had a right to wages that would secure essential material goods sufficient to enable a frugal but decent lifestyle for the worker and dependents. At the same time, Leo did not explore the full possible implications of moral equality and equal dignity for social, political, and economic life. The pope, who was of aristocratic ancestry, had no strong objection to social hierarchy in society, oligarchic or monarchical political orders, nor dramatic wealth differentials in an economy.
Later popes memorialized Leo’s encyclical with their own social teaching, often promulgated as anniversary celebrations of
Rerum novarum.
4 These texts, along with additional encyclicals, apostolic letters, conciliar texts, and various other episcopal documents have developed the church’s thinking about the meaning of moral equality and human dignity in such a manner that they have effectively moved Catholic teaching away from acquiescence of significant economic inequality toward what has been characterized as a “relative egalitarianism” when reflecting upon economic justice.
5 2. John Ryan and a Living Wage
Among those inspired by Leo’s encyclical was a young Minnesotan, John A. Ryan, who had decided to study for the priesthood and was in the seminary during the 1890s. Ryan’s early interest in economic justice stemmed from reading the Irish World and the populist politics of Ignatius Donnelly, a member of the National Farmers’ Alliance. Later, Ryan aligned with the more mainline Progressive movement. While in the seminary, he studied the work of the economist Richard Ely. When Ryan began doctoral studies in moral theology, he took economic courses, though they were not required, and studied John Hobson’s theory of under-consumption for his dissertation on A Living Wage.
Rerum novarum was significant for Ryan as it affirmed the idea of state intervention in the economy. It also shaped his commitment to a natural law method that was only sparingly related to explicit theological commitments. What Ryan did was relate natural law ethics to Progressivism and in so doing built bridges between Progressives and American Catholics. For Progressives, he helped them to see that Catholic natural law thinking could be utilized to embrace social reform. For American Catholics, many of whom were Irish and German immigrants, Ryan helped them accept that state intervention could be a means to advance the cause of working class people rather than oppress them. This was no small matter for Irish Catholics experienced with British rule or German Catholics familiar with Bismarck’s Kulturkampf. The key starting point for Ryan’s economic ethics was the equal dignity of human beings based upon their common human nature as creatures of God, which he rightly saw as the starting point of CST.
Ryan has been called the foremost exponent of CST during both the Progressive Era and the New Deal years. His ambition was to extend democratic ideals to the economic order. From 1906, when he published his doctoral dissertation on the ethical demand for
A Living Wage6, until his death in 1945, Ryan was strikingly consistent in his arguments for what economic justice entailed. He further developed, but did not significantly depart from, the argument of his dissertation with the publication of his other major work,
Distributive Justice in 1916.
7 Overall, Ryan published more than eighty books and pamphlets, along with numerous essays and speeches, as well as serving as ghostwriter for many statements by American Catholic bishops. This latter role was due to Ryan being the founding director of the Social Action Department of what was then called the National Catholic War Conference, later the National Catholic Welfare Conference, and eventually the U.S. Conference of Catholic Bishops. He remained in that role of director until his death almost thirty years later.
Key for Ryan’s economic ethics was a belief in what CST has come to refer to as the universal destiny of goods.
8 For Ryan, the idea that the goods of creation exist to meet the basic needs of all people is based on three claims. First, early human history illustrates it with primitive communism in regard to land ownership and efforts to help the poor; second, the Christian faith long taught that every person has a right to a share in communal wealth necessary to maintain life; and, finally, human reason shows that persons have equal dignity and worth.
Ryan then argued in three moves for what he called a living wage as the minimum of justice: (1) the universal destiny of goods means all have an equal claim upon nature’s bounty; (2) this inherent right of access to the earth’s goods is conditioned upon useful labor; and (3) those in control of natural resources are obliged to provide access to such resources for all willing to work. Every worker had a right to a decent living stemming from his or her labor since this was the only way most workers could share in the goods of creation. A living wage should be a family living wage. Ryan assumed that there was a male wage earner who would receive the wage, thereby allowing the adult female to maintain the home and supervise the dependent children.
For Ryan’s social ethics, the ultimate norm is human welfare and this is determined not speculatively, but by what actually happens to people when choosing one policy over another. This reflects Ryan’s inductive and empirical side. The fundamental content in ethics is the meaning of the human person and that is explored in terms of personal rights grounded in human dignity. What legitimates any particular right is human welfare for every person has the duty of self-perfection or personal development.
A human being has rights to all things essential for reasonable development of the person consistent with the rights of others to essential things for their personal development. The state is natural (because persons are social) and necessary (because persons cannot develop apart from the state). The aim of the state is to promote the common good or public welfare. Ryan’s “welfare theory” of the state is to safeguard all necessary rights as its primary role, with secondary functions of education, health, safety, charity, public works, morals, religion, and industrial regulation. Economic ethics is mainly about the proper distribution of worldly goods.
It is important to understand the distinction that Ryan made between human welfare, his preferred term, and social welfare, which he used to describe those reformers who advocated some form of social utilitarianism. The danger of social welfare as a norm is that it might conceivably be used to override the essential rights of individuals in the pursuit of overall societal benefit. Ryan, who was committed to the dignity of each individual, employed human welfare as his standard to make clear that, first and foremost, the essential rights of the individual were to be secured before considering societal goods. The focus was on the individual, and whether or not the person had the opportunity for his or her self-development. While fully supporting Ryan’s commitment to the individual and his rejection of social utility as the foremost norm, I do want to suggest that Ryan’s ideal of justice may be too intently concerned with provision of those goods essential for self-development to the neglect of other aspects of justice.
Ryan was strongly committed to equality when it came to a person’s claim to the essential goods for self-perfection. However, the scope of that right to essential goods was narrowly drawn. Everyone had a right to a decent livelihood, and this was at the heart of Ryan’s project from the time he wrote his dissertation. Once that entitlement was established, and Ryan was confident that a specific figure for a living wage could be determined, then inequality could occur due to a variety of factors including merit, effort, and greater capacity for development.
9 Ryan was not prepared to defend as a matter of justice any rights beyond the specific rights essential for the opportunity to develop. By being so specific about the right to the goods necessary for self-development, Ryan left little room for claims based on equality in his conception of justice. In his approach, the essential right to self-development was equal and absolute as well as specific. Justice required that society secure that for each person. Once that is achieved, however, Ryan was open to “presumptive rights to unequal shares of income and wealth.”
10Ryan’s moral theory of justice was based on his natural law method and belief in the equality of human dignity. From that commitment, he developed the claim about the absolute and equal right of every person to those goods necessary for self-development. The subject of economics played no role in Ryan’s theory to this point. Where economics does enter in is when the topic becomes how to ensure that the essential right is protected. For Ryan, living in the modern industrial society of twentieth century America, economics determined that the best means of securing the right to self-development was to guarantee a living family wage for every worker.
Ryan’s economic training led him to conclude that, although economic factors did not impinge on the philosophical determination of the existence of a right to self-development, such factors did impinge on his approach to justice in two other ways. First, the reality of a modern market system made the payment to a worker of a family living wage the crucial and most common way of ensuring each individual’s personal development. Second, economic factors like productivity, efficiency, scarcity, and effort all played into his conclusion that economic inequality was necessary to attain human welfare on a long-term basis, that is, “a society’s long-run provision for the means essential for individuals’ self-development.”
11Ryan does not avoid “the question of indefinitely large profits.” In accordance with the analysis above, he concludes that “as a general rule, business men who face conditions of active competition have a right to all the profits that they can get, so long as they use fair business methods.” Among those fair methods is the payment of a family living wage, as well as honesty in dealing with buyers and sellers. “When those conditions are fulfilled, the freedom to take indefinitely large profits is justified by the canon of human welfare.”
12 Although Ryan accepted capitalism, in principle, he never supported what he called ‘historical’ capitalism, the economic system that actually emerged in the United States. For Ryan, the system of historical capitalism as found in the U.S. embodied a set of interlocking principles that were unacceptable. Politically, there was opposition to any state intervention in the economy; economically, there was the conviction that unlimited production automatically translated into unlimited markets and full employment; and, ethically, there was an extreme individualistic reading of property rights.
During the Progressive era, Ryan saw three flaws in the economic order: inadequate remuneration for workers, excessive income for a small minority, and narrow distribution of capital ownership. The disproportion of income growth between rich and poor between 1900 and 1929 was especially problematic for Ryan, for if workers had insufficient income, they could not stimulate demand. Lacking demand, there would be a downturn in production meant to expand supply, which would lead to layoffs and increased unemployment. Loss of wages would only further reduce demand so the economy becomes entrapped in a depression. This is what Ryan believed led to the great economic collapse in 1929. It is important to note that Ryan’s concern about excessive inequality was not a moral argument, but an economic one. Unless workers had sufficient income they could not stimulate economic growth through demand. Barring that level of inequality, however, which would be remedied by a living wage, Ryan had no further criticism of “indefinitely large profits.”
As a remedy to the historic capitalism he experienced, Ryan argued the case for a living wage through state regulation and legislation that, in effect, built a floor below which no one ought to be allowed to sink. This was a significant development in American Catholic social thought and in the political sensibilities of many immigrant Catholics. Today, however, few beyond the most committed social Darwinists or Ayn Rand disciples would oppose the idea of a floor below which a decent society ought not let a person fall.
3. Post-Conciliar Catholic Social Teaching and Relative Egalitarianism
The more interesting ethical question, to my mind, when addressing inequality is not whether there is a floor beneath which none should fall (that is widely acknowledged among Christian ethicists), but is there a ceiling above which none should rise? John Ryan’s economic ethic made the case clearly and cogently that a living wage ensuring the essential goods needed for personal self-development was a right that must be secured. In this section of my essay, I would like to discuss why Ryan failed to argue for a ceiling and not just a floor when addressing economic inequality. I believe one major reason is that Ryan was so committed to a natural law methodology that he gave little attention to a biblical and theological approach, which might promote a more communitarian perspective on economic justice that gives greater weight to the ills of inequality.
The movement toward a more biblical and theological methodology in CST was profoundly influenced by the event of Vatican II. The development in CST inspired by the Council can be illustrated by the “Pastoral Constitution on the Church in the Modern World” (Gaudium et spes) and its communitarian perspective. This perspective can be found in four elements of the Pastoral Constitution’s message.
First, the understanding of the human person in the document can be described as relational. In one place, the text cites Jesus’ prayer in John 17, 21–2 where he prayed to his Father, “that all may be one . . . as we are one. The document goes on to claim that this prayer “implied a certain likeness between the union of the divine Persons, and in the union of God’s children in truth and charity.”
13 The bishops maintain that “having been created in the image of God…all people are called to one and the same goal, namely, God himself.” Love of God and love of one’s neighbor cannot be separated, and is the first and greatest commandment. “To people growing daily more dependent on one another, and to a world becoming more unified every day, this truth proves to be of a paramount importance.” The council fathers state that, “social life is not something added on to the person,” but is necessary for human flourishing.
14 “[T]hrough dealings with others, through reciprocal duties, and through fraternal dialogue people develop all their gifts and are able to rise to their destiny.”
15 Consequently, the Pastoral Constitution proclaims, “by their innermost nature human persons are social beings, and unless they related themselves to others they can neither live nor develop their potential.”
16Once the social nature of the person is clearly asserted, the second element of the perspective is addressed, namely that community is the social ideal. For “God did not create the person for life in isolation, but for the formation of social unity.”
17 Rather God, “from the beginning of salvation history...has chosen people not just as individuals but as members of a certain community.”
18 Thus, “the will to play one’s role in common endeavors should be everywhere encouraged.”
19 It is this firm conviction about the centrality of communal life for human development that undergirds the theme of the universal destiny of goods: “God intended the earth and all that it contains for the use of every human being and people.”
20 This demands that “attention must always be paid to the universal purpose for which created goods are meant” no matter the “diverse and changeable” patterns of private ownership that exist.
21 This communitarian perspective provides the context not only for proper understanding of property rights but all genuine human rights. “For the protection of personal rights is a necessary condition for the active participation of citizens, whether as individuals or collectively, in the life and government of the state.”
22 Indeed, politics can be understood as the art of enabling wider and wiser participation in community. “It is in full accord with human nature that juridical-political structures should, with ever better success and without any discrimination, afford all their citizens the chance to participate freely and actively in establishing the constitutional bases of a political community, governing the state, determining the scope and purposes of various institutions, and choosing leaders.”
23 Of course, the entire aim of political life is to promote and protect the common good; “the political community exists for that common good in which the community finds its full justification and meaning.”
24The third element of the communitarian perspective articulated by Vatican II is its linkage with the ecclesiology of the council. As the bishops wrote, “Everything we have said about the dignity of the human person, and about the human community and the profound meaning of human activity lays the foundation for the relationship between the Church and the world.”
25 In
Lumen gentium, the Dogmatic Constitution of the Church, there is the statement that the church is a sacrament of the unity of humankind. The bishops quote themselves in
Gaudium et spes when they say, “For the promotion of unity belongs to the innermost nature of the church, since she is, ‘by her relationship with Christ, both a sacramental sign and an instrument of intimate union with God and of the unity of all humankind.’”
26 They saw in this text an affirmation that the church’s task is the fostering of unity and a common life among people.
Finally, the fourth element constituting the communitarian perspective is the centrality of solidarity in CST. The council fathers begin with the observation that “One of the salient features of the modern world is the growing interdependence of persons one on the other.”
27 While technical progress in communication, trade, travel, and other advances have promoted this interdependence, the genuine dialogue sought “does not reach its perfection on the level of technical progress, but on the deeper level of interpersonal relationship.”
28 This understanding paved the way for the later claim of John Paul II that “
interdependence, sensed as a
system determining relationships in the contemporary world, in its economic, cultural, political, and religious elements,” must be “accepted as a
moral category. When independence becomes recognized in this way, the correlative response as a moral and social attitude, as a ‘virtue,’ is
solidarity.”
29 For John Paul, it was crucial that, “Interdependence must be transformed into
solidarity.”
30 To convey the more interpersonal dimension of solidarity compared to the empirical fact of interdependence, the pope employed the image of the interdependent other “as a sharer, on a par with ourselves, in the banquet of life to which all are equally invited by God.”
31The solidaristic ethic emerging out of the communitarian perspective gives greater emphasis to the importance of equality than the pre-conciliar natural law methodology employed by Ryan. As the bishops wrote, “although rightful differences exist between people, the equal dignity of persons demands that a more humane and just condition of life be brought about. For excessive economic and social differences between the members of the one human family or population groups cause scandal, and militate against social justice, equity, the dignity of the human person, as well as social and international peace.”
32The theological vision of humanity as one family and the church as a sacrament (i.e., an external or material symbol that makes visible an internal or spiritual reality) of that unity serves as a backdrop to the ethic espoused in CST. The theological theme of the communion of humankind has its counterpart in an ethical principle of solidarity. This principle generates moral norms regulating the political and economic framework espoused in CST. Solidarity serves as the ethical expression of the “deep theory” that generates recent CST.
33By the expression “deep theory,” I refer to the taken-for-granted understanding of justice in an ethical theory. It is “the tacit intuition or vision that undergirds a conception of justice.”
34 When the Catholic imagination envisions a just society, it depicts a situation in which humans exist in right relationship to one another. Within the Catholic imagination, the human good is related to the experience of communities that practice mutual respect and honor, forgiveness and love. Consequently, the Catholic understanding of justice demands the creation of genuine community where belonging, respect, friendship, forgiveness, and love are essential to human well-being. These are goods not readily captured by the language of rights and duties. Instead, they are better understood as conditions required for the establishment and flourishing of human community. Central to the theory of justice in modern CST is the recognition that human dignity can be realized and protected only in community.
35In summary, Vatican II affirmed human solidarity as a major theme and goal of a Catholic social ethic. The goal became solidarity and relative equality became the normative principle: the regular use of public policies, including “redistribution, to redress significant differences between groups is necessary to preserve and foster community.”
36 As noted earlier, “relative” means inequalities are held within a defined range set by moral limits. The desired goal is community that sustains and enhances bonds that unite people.
37 4. The Breakdown of Solidarity due to Inequality
Yet today, as in the past, wealth and power can provide significant opportunities for people to isolate themselves from one another, to secede from our common life. More than one observer has cited the trend of people losing interest in public goods while using private means to avoid the harm stemming from the decay of public life. While it is true that many wealthy still rely on public monies in a variety of ways—for example, private jets require a whole network of publicly financed air traffic control and airports—nonetheless, it is also true that there is a growing disengagement with public life.
It is clear that the very rich have been pulling away from the rest of American society. The empirical data show that the share of income going to the top 1%, the top 5%, and top 10% have all grown far more than the lower half of the population. The top 1% now receive more than 20% of total household income. The top 20% gets almost half of all income. The share of total income that goes to the wealthiest quintile is higher than at any time since 1929, just before the great stock market crash.
The process of secession of the top one-fifth of high earners from the rest of American society is a gradual one and takes a variety of forms. Many wealthy people now live in residential enclaves that employ private companies for security, trash collection, even road maintenance, while nearby municipalities are too financially strapped to provide such services adequately. Privileged children attend private schools, summer camps, and other activities available only to those who can pay for the entrance fees. As public parks and playgrounds deteriorate, there is a proliferation of private health clubs, golf clubs, tennis clubs, and every other type of recreational association in which the costs are shared by members. It is not hard to detect in the animosity towards taxation a lost sense of solidarity whereby citizens contributed to public services and goods that may or may not have been directly beneficial to them.
Patterns of public benevolence also illustrate the tendency of the successful to secede from the larger society. The charity of the affluent does not go mainly to social welfare programs for the poor. Instead, most philanthropy of the wealthy is directed to the places and institutions that entertain, inspire, cure, or educate wealthy Americans—art museums, opera houses, theaters, orchestras, ballet companies, private hospitals, and elite universities. Corporate philanthropy follows the same self-serving pattern. For some time now, corporate giving to primary and secondary education has been less than the amount host communities grant businesses through tax breaks and subsidies.
CST recognizes that the appeal to solidarity may not be heard by those who can successfully isolate themselves from the experience of interdependence with the poor. Hence, the point in CST that solidarity must be understood as more than an acknowledgement of empirical interdependence. Instead, it is a moral imperative generated by a communitarian outlook that challenges liberal individualism. Like other moral imperatives, it calls for conversion; it asks for change in the way we have structured our social order. Solidarity must be a conscious choice of people who seek ways of improving the good of all, if a commitment to the common good demands that some place limits on their own desires or stated interests that should be done. CST argues not from enlightened self-interest but from a theological claim about the unity of the human family and the moral obligations that arise from a vision of the community of persons.
Whereas John Ryan, along with other pre-conciliar social theorists, endorsed distributive justice that provided a minimum for all, the relative egalitarianism of a theologically informed CST demonstrates greater sensitivity to how huge disparities in wealth and income create and perpetuate divisions that prevent the building up of a shared common life. Solidarity as a commitment to truly care for the well-being of the other is a countermeasure to the secession of the successful that is a result of the yawning gaps between rich and poor. Given the residential patterns of many Americans, the one thing neighbors have in common is income levels and this is what constitutes the false notion of community for Americans. It leads to what Robert Bellah once called “lifestyle enclaves.”
38John Ryan’s focus on natural law reasoning prevented him from integrating the sort of theological themes into his social ethic that later CST has developed. As a result, his argument for a living wage, as important as it was, left his political program with a floor but no ceiling. Today, we must move beyond Ryan’s approach. I believe an economic ethic informed by CST requires that we set a ceiling as well as establish a floor when we address the inequality of wealth accumulation and annual income.
5. What Might the Christian Community Do?
I close this reflection by suggesting some ways for the ecclesial community to move forward in the pursuit of economic justice.
First, we must acknowledge that two types of structures are at work in any culture: ideological and operational. Operational structures refer to the patterns of behaviour that make up our social world, e.g., zoning laws, tax systems, international trade agreements, health care systems, monetary and banking policies. These are operational structures. Ideological structures refer to patterns of belief, the configuration of values that make up our social understanding. Operational structures are wrong when the ideological structure implicit in them and supportive of them offends human dignity. Ideological structures demean persons when values other than human dignity become the organizing and dominating values of a society.
Part of the task in promoting social change is to analyze the values of a culture so as to awaken different moral sensibilities, calling forth new images of what might constitute human fulfillment. To bring about change on the operational level, there is the need to complement or even precede it by transformation on the ideological level. Therefore, if the Christian community is to be effective in bringing about social change, a dual focus is necessary, addressing both types of structure: operational and ideological. However, although the community of faith must act where it can on the operational structures of a society, its real strength is to foster and tutor the moral imagination so as to combat the ideological structures that undergird and inspire operational structures denigrating human persons.
The prevailing view of economic policy making is that people are essentially self-interested rather than altruistic and behave the same way whether they are buying a car or voting on a public referendum. Personal preferences are not significantly affected by politics or moral norms but driven more by self-interest. The public good is simply the sum of individual preferences. Society is working effectively whenever people’s preferences can be satisfied without making other people worse off. Usually, market exchanges suffice for improving society this way.
Such a policy approach does not take ideas seriously. It does not inquire into our ideas about what is ethically good for society, nor does the economic approach see the utility of debating the relative merits of differing conceptions of the good society. The prevailing view shortchanges the role that normative visions can play in shaping what people want and expect from government, their fellow citizens, and themselves. Furthermore, the dominant approach disregards the importance of public deliberation for refining and revising normative visions.
CST suggests that ideas about what is good for society ought to occupy a more prominent place in public life. The responsibility of those who deal with public policy is not reducible to identifying what people want for themselves and then to go about implementing the most efficient means to satisfy these wants. Instead, CST suggests that the Christian community ought to provide alternative visions of what is desirable and possible, to stimulate deliberation about them, to provoke an examination of a culture’s assumptions and values, and thereby deepen society’s self-understanding.
Many of the important policy initiatives in recent decades cannot be explained by the prevailing view of public policy. The civil rights laws of the 1960s, the movements of public health, consumer safety, and environmental protection in the 1970s—these policies were not motivated mainly by individuals seeking to satisfy selfish preferences. People supported these initiatives largely because they thought it would be good for American society. In addition, public support for these initiatives has not been stable and unchanging, since public support has grown and evolved as people engaged the ideas and values underlying various policy proposals.
It is also true that some of the most accomplished government leaders are those men and women who purposefully craft visions of what is desirable and possible for society to do. Rather than simply giving voice to already existing public wants, the true art of political leadership has been to give voice to half-known, half-articulated hopes and dreams that people have for their society. If that is true, then there is more room for the influence of CST than is sometimes thought. There was a time when child labor in factories and mills was widely accepted in this country—and then it was not. There was a time when cigarette smoking was widespread and unquestioned in public places—and then it was not. How does the unthinkable become thinkable? How does the conventional wisdom become unconventional? Or vice versa?
Adherents of CST have an obligation to at least raise the topic of whether the solution to huge inequality requires more than putting in place floors for those at the bottom. Supporters of CST ought to raise the issue of putting in place ceilings to prevent some to rise too high above the rest. Of course, it is not only ideas, but ideas translated into policies that are necessary to move our nation in the right direction.
Let me close with four brief policy ideas that are worth discussing as illustrations of how the construction of a ceiling in order to restrain inequality might be built.
Move toward a higher top personal income tax rate by revising the present top rate of 39.6% for those making $415,000 or more, to several additional stages of 45% for those making more than $750,00, 50% for those making more than $1.25 million, and 55% for those making more than $2 million.
Create different and higher rates of annual taxation on non-earned income, i.e., investment returns, once it rises above a certain threshold, say $50,000 of non-earned income annually.
Establish higher inheritance taxes. This might be along the line of Atkinson’s Lifetime Capital Receipts Tax (with a spousal exemption). Choose a tax-exempt ceiling, say $100,000 in gifts over the course of a lifetime. After that figure, every gift is taxed starting at 20% with a progressive rate as the amount increases over a lifetime. The tax is on the receiver of the benefit not the giver. That might encourage givers to spread their wealth around, giving it to more people who have little inheritance rather than a favored few who gather the bulk of it.
Develop a new tax on corporations that exceed a certain highest/lowest pay ratio; for example, 100–1 when comparing top compensation to median compensation in each corporation—or, less coercively, require an annual public listing of pay ratios in every company in order to promote a voluntary effort at a more equal distribution of a company’s assets.
39
These are merely policy ideas cited for the sake of illustration. I do not mean to endorse or recommend any of them without further examination. Rather, I mention them in order to provoke conversation about the goal of implementing a ceiling as well as a floor when we think about economic inequality. I do not think the policy discussion can or should go forward until we have done the work of public discourse that expands our moral and political imaginations beyond the conventional wisdom about what is a good society. U.S. citizens should consider alternative formulations of what a good and just society might look like. In that project, I think CST and the Catholic community have a useful role to play in advocating relative equality as integral to economic justice.