Tag Archives: catechism of the catholic church

Four categorical consequences of personal sin

The Catechism of the Catholic Church reminds us of four categorical consequences of sin. Paragraph 1469, quoting Pope St. John Paul II’s 1984 apostolic exhortation On Reconciliation and Penance, states the following on the effects of the Sacrament of Penance:

“It must be recalled that…this reconciliation with God leads, as it were, to other reconciliations, which repair the other breaches caused by sin. The forgiven penitent is reconciled with himself in his inmost being, where he regains his innermost truth. He is reconciled with his brethren whom he has in some way offended and wounded. He is reconciled with the Church. He is reconciled with all creation.

There are four categorical consequences to every sin committed: personal, social, ecclesial, and cosmic. Each sin committed – whether venial or mortal – affects the individual personally (say, by restricting growth in virtue); socially (by somehow adversely affecting one’s relationship with others); ecclesially (wherein the Body of Christ – the Church – is somehow disrupted); and cosmically (read Genesis, Chapter 3 to discover how the cosmos – creation itself – is affected by the sin of our first parents). But these four areas of disruption – these breaches – can be healed through the Sacrament of Reconciliation because of Almighty God’s intervention, forgiveness, and mercy.

It’s the third of these consequences I’ll focus on here: the ecclesial disruption caused by sin – during this time of egregious Church scandal. As Christians, we know that sin is always a personal act. Even though it might be carried out with another (as in adultery) or with others (say, when a group robs a bank), sin is always committed by one’s personal choice. In fact, the Church defines sin not only as an offense against God, but as an offense against truth and a person’s own reason and right conscience.

As the Catechism makes clear, the Church herself benefits from her members individually receiving the Sacrament of Penance. This is important to recall at a time when we confront egregious Church scandal and seek a lasting remedying and healing of the situation. Paragraph 1469 states:

“This sacrament (of reconciliation) reconciles us with the Church…. In this sense it does not simply heal the one restored to ecclesial communion, but has also a revitalizing effect on the life of the Church which suffered from the sin of one of her members.”

The Church benefits from her members going to Confession. And while the Church’s current crisis rightly puts clerics and their superiors in the spotlight, the bigger picture needs to also be examined to help solve that crisis as an important one among others. The old saying that “no man is an island” is aptly applied here. In other words, everything each one of us does – whether cleric or lay member – is somehow interconnected with that big picture. “My sins do not affect just me,” can be said here.

As the Catechism Paragraph 1039 states, “The Last Judgment will reveal even to its furthest consequences the good each person has done or failed to do during his earthly life.”

With this truth in mind, we can begin to discern not only how clerical abuse has played its major part in contributing to the ecclesial consequences of personal sin, but how the following crises concerning the laity have, as well: only 23 percent of Catholics attend Mass on Sundays (even before the scandals were exposed); 82 percent of Catholics view contraceptives as morally acceptable; 49 percent of Catholics believe abortion should be permissible in some circumstances; 50 percent of Catholics practice cohabitation before marriage; 67 percent of Catholics approve of so-called gay “marriage”; and only 2 percent of Catholics go to Confession regularly.

Again, “no man is an island.” We are all somehow interconnected in what we do vicefully – and there are ecclesial consequences because of it. But the good news is, we are also interconnected in what we do virtuously. And returning to the Sacrament of Reconciliation is one such virtuous act.

FR. WADE L. J. MENEZES, CPM is the assistant general of the Fathers of Mercy, an itinerant missionary preaching order based in Auburn, KY. He is host of EWTN Global Catholic Radio’s “Open Line Tuesday” and the author of The Four Last Things: A Catechetical Guide to Death, Judgment, Heaven, and Hell (EWTN Publishing).

St. John Paul II’s greatest gift

What was the greatest gift that Pope St. John Paul II left the Church? Some talk about the impact of World Youth Day. I have heard others say his prolific teaching on the Theology of the Body will be his legacy.

Thomas Monaghan

Thomas Monaghan

What about his leadership in publishing the universal Catechism of the Catholic Church (CCC)? The previous officially authorized catechism — the Roman Catechism — was published in 1566, just after the Council of Trent!

Do you remember the confusion that existed prior to the publication of the new catechism? I sure do. Confusion (aka dissent) among theologians was widespread and there was no definitive catechism that we as Catholics could point to as the official teaching of the Church. It was a confusing time for people who were genuinely searching for the truth, not to mention those who were looking for reasons behind specific Church teaching.

In the late 1980s, the Holy Father asked a group of cardinals and archbishops to work on developing a new universal catechism for the Church. Then-Cardinal Joseph Ratzinger was the president of the commission and Cardinal Christoph Schönborn was appointed editorial secretary. John Paul officially approved the new Catechism of the Catholic Church in 1992.

Did you know that the CCC is a “universal catechism,” which means it is intended to be a resource for the development of other national (or local) catechisms? For example, from the CCC there is YOUCAT, a youth catechism. It’s the official catechism for World Youth Day and was written for youth and young adults. In 2006, the American bishops published the U.S. Catholic Catechism for Adults, which has the same structure as the CCC, but also includes stories, reflections, quotations, discussion questions, and prayers in each chapter geared toward Americans.

To say that the Catechism is a great gift to the Church would be an understatement. Our mission in Legatus is to study, live and spread the faith, and we can only share that which we know. Whether you have read it before or not, I encourage every member to read the Catechism. I was looking at it the other day and realized that if you read just two pages a day, you would read through the whole book in about a year.

Lastly, as we continue to roll out Legatus’ new Awards & Recognition program, I want to take this opportunity to announce that we will recognize any member who reads the entire CCC (starting Oct. 1, 2015) by awarding them with a Catechism Completion pin!

TOM MONAGHAN is Legatus’ founder and chairman. He is a member of Legatus’ Ann Arbor Chapter.

Religious freedom and the family

MONSIGNOR JOSEPH SCHAEDEL writes that Catholics must stand for religious liberty . . .

Monsignor Joseph Schaedel

Monsignor Joseph Schaedel

by Monsignor Joseph Schaedel

It’s obvious that one of the greatest threats to our Catholic ideal of marriage and family is the absurd notion that the government or the courts can redefine marriage. God defined it permanently thousands of years ago.

Those who follow the news have heard of the political war in my state of Indiana over our RFRA (Religious Freedom Restoration Act). I’ve always lived in Indiana, and I have never seen such a political circus in my life! Many people have asked me about the RFRA, but I sort of avoided the question. I’m not afraid to discuss the religious freedom law, but I’m not interested in talking about it with people who have no idea what they’re talking about — or who have no interest in knowing the facts.

In each case, when I was questioned, I asked the inquirer if they had read the bill. So far not one of them has. I learned the hard way back in grade school that it’s not a good idea to report on or even discuss a book or article you’ve never read. Trying to do so makes you look stupid.

When I was ordained a priest 33 years ago, never in my wildest dreams did I think we would see clergy being forced to officiate at “weddings” that directly contradict the minister’s own faith. Nor did I ever imagine the president of the United States and his administration dragging the Little Sisters of the Poor into court so as to force them to pay for objectionable medical procedures and products that cause abortions.

The controversy swirling around Indiana’s RFRA made constant use of the word “discrimination.” We need to make a distinction between “discrimination” and “unjust discrimination.” We all discriminate. We discriminate between Coke and Pepsi, Shell and Exxon, the choices discriminating parents make for families about schools, and so forth.

The Catholic Church discriminates: Non-Catholics may not receive Holy Communion at a Catholic Mass. Persons previously married may not remarry in the Catholic Church unless they receive a Church annulment. Women may not be ordained. We’re not the only ones: Only Mormons may enter the Mormon Temple. Only celibate Orthodox priests can become Orthodox bishops. And so on.

Unjust discrimination is something else. This is when we decide against or in favor of someone for reasons which violate the human dignity and rights of that person (made in God’s image) often on the basis of race, color, or creed. And nowadays we are aware that it’s often done on the basis of religion, gender or sexual identity.

The sad part is that unjust discrimination is all around us. Catholics are at the top of the list. For example, at the end of March, Toronto’s city council voted to bar a woman from the Toronto public health board because of “her Catholic views.” Did you read this in the mainstream media or see it on any major news network? Of course not. And you won’t. This is nothing new. A dozen years ago, a non-Catholic author named Philip Jenkins wrote a book called The New Anti-Catholicism: The Last Acceptable Prejudice (Oxford University Press, 2003).

There are innumerable instances of unjust discrimination against other religious groups and various groups of people. A major difference is that most don’t have huge amounts of money — like some groups do — to pay big public relations firms to stir up people in sympathy for our plight.

A case in point would be the current ruckus against the archbishop of San Francisco. The archbishop wants to make sure that all Catholic high school teachers live, work and teach in such a way that does not contradict the teaching of the Catholic Church. His opponents are spending lots of money on high-profile professional PR firms to oppose him.

The Catholic Church teaches that all unjust discrimination and prejudice is clearly wrong; it is sinful. Of course, the spotlight in our current Indiana situation seems to be on persons of same-sex attraction and those who wish to redefine marriage. The Catechism of the Catholic Church has three specific sections referring to homosexual persons. The Catechism clearly states that “they must be accepted with respect, compassion, and sensitivity. Every sign of unjust discrimination in their regard should be avoided” (# 2358).

Family and marriage are sacred; they cannot be “redefined.” But anyone who thinks they might be able to hide behind the federal RFRA or Indiana’s RFRA in order to unjustly discriminate anybody is out of luck. They need to read not only the RFRA, but also the Catechism of the Catholic Church.

MONSIGNOR JOSEPH F. SCHAEDEL is the chaplain of Legatus’ Indianapolis Chapter and pastor of St. Luke Catholic Church in Indianapolis.

Do Catholics believe in the rapture?

TIM DRAKE: Catholics believe in the rapture, but in a very different way than Protestants . . .

Tim Drake

Tim Drake

With Left Behind (Nicolas Cage) opening in theaters this month, it’s time to revisit the question, “Do Catholics believe in the rapture?”

The short answer is “yes,” with conditions. The long answer is that we don’t believe in the rapture in the sense that many evangelicals, fundamentalists, and the popular culture imagine it — where the redeemed are carried into Heaven in the blink of an eye at some point prior to Christ’s second coming.

The word “rapture” comes from the Latin word rapiemur, “to be raised up.” Paul writes, “For the Lord himself … will come down from heaven, and the dead in Christ will rise first. Then we who are alive, who are left, will be caught up together with them in the clouds to meet the Lord in the air” (1 Thess 4:16-17).

However, rapture as envisioned by the authors of the Left Behind books, is part of an apocalyptic belief system known as dispensational premillennialism. Carl Olson, author of Will Catholics Be Left Behind?, writes that this erroneous belief “teaches that the rapture and the second coming of Christ are two distinct events separated by a time of tribulation and a 1,000-year reign of Christ.”

Believers in this false teaching expect that Christians (not including Catholics) will vanish to meet Christ before his second coming. Unbelievers will be left behind to suffer during a time of tribulation, and then Christ will return a third time to conquer the Antichrist. Catholicism rejects such an interpretation of scripture.

This theory traces its roots to the 1830s and John Nelson Darby, an Anglican leader of the Plymouth Brethren. It gained popularity through the works of Hal Lindsey in the 1970s, and Tim LaHaye and Jerry Jenkins’ series of fictional Left Behind novels.

Catholics believe that Christians living during Christ’s second coming will be gathered along with those who have died in Christ to be with him forever. However, Catholics do not believe that a rapture will take place prior to that time. This belief is a form of millennialism, which the Church strongly condemns.

The Catholic Church is “amillennial,” meaning that it believes that Christ’s second coming and the last judgment will happen at the same time. According to Colin Donovan, theologian at EWTN, the Church “teaches that Christ already reigns in eternity (1 Cor 15:24-27) and that in this world his reign … is found already in the Church.”

Therefore, we believe “He will come again in glory to judge the living and the dead.” Our belief is that the rapture will take place at the end of the world, and not until then.

TIM DRAKE is Legatus magazine’s editorial assistant.


Catechism 101

Before Christ’s second coming, the Church must pass through a final trial that will shake the faith of many believers. The persecution that accompanies her pilgrimage on earth will unveil the “mystery of iniquity” in the form of a religious deception offering men an apparent solution to their problems at the price of apostasy from the truth. The supreme religious deception is that of the Antichrist, a pseudo-messianism by which man glorifies himself in place of God and of his Messiah come in the flesh.

The Antichrist’s deception already begins to take shape in the world every time the claim is made to realize within history that messianic hope which can only be realized beyond history through the eschatological judgment. The Church has rejected even modified forms of this falsification of the kingdom to come under the name of millenarianism, especially the “intrinsically perverse” political form of a secular messianism.

Catechism of the Catholic Church, #675, 676

What entails duty to children and oneself?

Parents have the ultimate responsibility to educate their children in the faith . . .

faithCatholic education recognizes that knowledge is at the service of man and must be directed toward the common good and the salvation of all. Such education requires training in the virtues and is rooted in the commandments of God.

To understand Catholic education, we must understand the nature of man, his relation to God, and his relation to others. A proper education is a natural right of every person. Because every man is created in the image and likeness of God, he has a right by the fact of his existence to obtain an education suited to his existence.

Such an education allows the person to grow into manhood according to the mature measure of Christ (Eph. 4:30) and devote himself to the building up of the Mystical Body. Moreover, aware of his calling, he should grow accustomed to giving witness to the hope that is within him and to promoting that Christian transformation of the world by which natural virtues may contribute to the good of society as a whole.

Authentic education primarily entails a formation in moral living and an invitation to knowledge of the truth. The ideals of an authentic Catholic education will not be realized unless they take form through the experiences offered by an educator. Unfortunately, much education today does not include a proper understanding of obligations toward others. Many educators emphasize knowledge for the sake of knowledge. In many Catholic schools, religious education, adoration of God, and liturgical worship occur but don’t always permeate the educational environment.

A Catholic educator has a serious obligation to saturate his methods with respect for the rights of students and Christian charity. Recognizing that many educational systems do not allow for an explicitly Catholic education to exist, the witness of Catholic educators by their way of life can nonetheless transform any educational setting into a Catholic experience.

Education is a tool of evangelization. To the degree an educator promotes human dignity and the knowledge of the truth, the education is authentic. To the degree the educator forms the students into the likeness of Christ, the education is truly Catholic. Catholic educators would do well to saturate their lives according to the principles given by the Church.

Men “realize today more than ever, amid the most exuberant material progress, the insufficiency of earthly goods to produce true happiness either for the individual or for the nations,” Pope Pius XI wrote in his 1929 encyclical Divini Illius Magistri (On the Christian Education of Youth). “And hence they feel more keenly in themselves the impulse toward a perfection that is higher, which impulse is implanted in their rational nature by the Creator himself. This perfection they seek to acquire by means of education” (#6).

LEON SUPRENANT is the director of My Catholic Faith Delivered. This column is reprinted with permission from his book “Faith Facts: Answers to Catholic Questions, Vol. 1,” which he co-authored with Philip C.L. Gray (Emmaus Road Publishing, 1999).


Catechism 101

The fecundity of conjugal love cannot be reduced solely to the procreation of children, but must extend to their moral education and their spiritual formation.

Parents have the first responsibility for the education of their children. They bear witness to this responsibility first by creating a home where tenderness, forgiveness, respect, fidelity, and disinterested service are the rule. The home is well suited for education in the virtues. Parents have a grave responsibility to give good example to their children. By knowing how to acknowledge their own failings to their children, parents will be better able to guide and correct them.

Catechism of the Catholic Church, #2221, 2223

Tom Monaghan and the Catechism

Kathy Schiffer writes that Tom Monaghan helped make the Catholic Catechism a reality . . .

Kathy Schiffer

Before we begin,” said Cardinal Christoph Schönborn, “I want to thank Tom Monaghan for funding the Catechism.”

It was September 2003, and the group gathered at the archbishop’s palace in Vienna gasped. Despite occasional snippets in the press, Tom has always been modest about his personal philanthropy, and even his office staff had never heard this story.

On this 20th anniversary of the Catechism of the Catholic Church, I join Cardinal Schönborn in extending my thanks to Tom for this singularly important gift to the Church — and I offer you an inside look at the

I was working as conference director for Legatus and leading the group’s annual pilgrimage to Rome. Each year there is a side trip to another European destination. This time we had planned a pilgrimage to Vienna. Our itinerary included tours of palaces and galleries, and a Danube River cruise ending in a heurigen — a traditional Viennese celebration of the harvest, replete with the new unfermented wine.

On this late September afternoon, though, we were at the archbishop’s palace on the north side of St. Stephen’s Square. There we attended Mass in the archbishop’s private chapel, followed by an address from Cardinal Schönborn, archbishop of Vienna, ending with a reception and dinner. It was an evening to cherish.

We sat on narrow chairs in a small room near the chapel, waiting for the cardinal to complete his tasks in the sacristy and address our group. Finally he arrived. A popular figure, he received a standing ovation from our group of American business leaders.

Tom Monaghan speaks with Cardinal
Christoph Schönborn in September 2003

And as we took our seats, he began as I wrote above: “Before we begin, I want to thank Tom Monaghan for funding the Catechism.” He explained that in the mid-1980s, Pope John Paul II had indicated an interest in developing a catechism for the worldwide Church. A commission of 12 bishops and cardinals had been put in charge of the project. But for several years, it had not moved forward.At the end of each fiscal year, various Vatican departments looked at their budgets but could not find room for such a large project.

That was, he explained, when Tom stepped in and offered the necessary sponsorship for the research, travel, staff and equipment necessary to complete the project. Without Tom, Cardinal Schönborn explained, the Catechism might never have been published.

John Paul II approved the text on June 25, 1992, and promulgated it Oct. 11, the 30th anniversary of the opening of the Second Vatican Council, with his apostolic constitution Fidei Depositum. It was published in French in 1992 and was then translated into many other languages. In the U.S., the English translation was published in 1994.

In Fidei Depositum, the Holy Father declared that the Catechism is “a valid and legitimate instrument for ecclesial communion and a sure norm for teaching the faith,” and stressed that it “is not intended to replace the local catechisms duly approved by the ecclesiastical authorities, the diocesan bishops and the episcopal conferences.”

Thomas S. Monaghan — who grew up in an orphanage, founded Domino’s Pizza, bought and sold the Detroit Tigers baseball franchise, then took what he called a “rich man’s vow of poverty” — has done much to advance the Catholic faith in the modern world. He founded Legatus, provided the seed funding for the Ave Maria Radio network, and he established a Catholic university and law school, which are now graduating men and women well qualified to effect change in the culture.

He supported Catholic elementary, high school and preschools in the Ann Arbor area; he helped to institute the Thomas More Law Center; and he provided constant support for many pro-life initiatives, nationally and locally.

But this one project — the Catechism of the Catholic Church — has implications which reach beyond our era, offering guidance and unpacking difficult theological issues for the common reader far into the future. For his part in bringing this to fruition, and for all he’s done, we are grateful to Tom Monaghan. May God continue to bless him!

Kathy Schiffer served as Legatus’ conference director from 2001-2005. She is Ave Maria Radio’s director of publicity and special events. She blogs at Patheos.com.

What are relics and why are they important?

Al Kresta says scripture favorably describes and nowhere forbids venerating relics . . .

Al Kresta

Biblical people have always reserved items associated with holy persons and events. Relics of ancient Israel’s past — the manna from the wilderness, Aaron’s rod that budded, and the tablets of the Law — were all set aside, deposited and reverenced in the Ark of the Covenant.

Scripture favorably describes and nowhere forbids the venerating of relics. Since the early days of the Church the remains of martyrs and holy persons have been called relics, from the Latin reliquiae, meaning “remains.” A reliquary is a vessel that contains and displays these remains.

The martyr was celebrated as the disciple who most faithfully imitated Christ in his death. His willingness to die for the name of Jesus bore witness par excellence to the life of the age to come, a life superior to this world that was passing away. Early Christian worship developed over the gravesites of those who had been martyred, since the martyrs were those who were thought to have been special vehicles of the Holy Spirit.

This was no mere idealizing of the dead. The martyr was an intimate of God who was still a living member of the Church. When his tomb and the Church’s altar were joined, the Roman world was jolted. Graves were now “non-graves,” private places were now public, township sites once reserved for the dead were now being inhabited by the living. Life was replacing death. A distinctive sign of a growing Christian community in late antiquity was the presence of shrines and relics.

Eventually, when churches were built in territories that had no martyrs, a fragment of a martyr’s remains would be embedded in or around the altar. By the Second Council of Nicea in 787, each church building had to contain a relic before it could be consecrated.

No, Christians weren’t worshiping the martyrs. Relics are simply mementos, not idols. A brick from the Berlin Wall or a scrap of a Tchaikovsky score all receive places of honor in a person’s home or library. We are grateful to let such contemporary “relics” stimulate our memories and affections, but we don’t worship or offer sacrifice to our deceased grandfather’s violin even though we hang it prominently in our foyer.

The Church is very cautious in investigating and approving relics. Anyone who makes or knowingly sells, distributes, or displays false relics for veneration incurs ipso facto excommunication reserved to the bishops. All relics must be authenticated and can only be publicly displayed if they have supporting documentation.

A first-class relic is the corpse of a saint or any part of it. Second-class relics include any object sanctified by close contact with a saint or Our Lord. Third-class relics are objects or cloths touched to either first- or second-class relics. Relics are one more way that God demonstrates the fitness of the physical world to be a carrier of his grace and mercy.

Reprinted with permission from “Why Do Catholics Genuflect?” by Al Kresta (St. Anthony Messenger Press, 2001).


Catechism 101

Besides sacramental liturgy and sacramentals, catechesis must take into account the forms of piety and popular devotions among the faithful. The religious sense of the Christian people has always found expression in various forms of piety surrounding the Church’s sacramental life, such as the veneration of relics, visits to sanctuaries, pilgrimages, processions, the Stations of the Cross, religious dances, the rosary, medals, etc.

These expressions of piety extend the liturgical life of the Church, but do not replace it. They should be so drawn up that they harmonize with the liturgical seasons, accord with the sacred liturgy, are in some way derived from it and lead the people to it, since in fact the liturgy by its very nature is far superior to any of them.

Catechism of the Catholic Church, #1674-1675

Why did Christ establish the Church?

Peter Kreeft wonders: What if Christ didn’t establish the Catholic Church? . . .

Peter Kreeft

The fundamental reason for being Catholic is the historical fact that the Catholic Church was founded by Christ, and was God’s invention, not man’s — unless Christ, her founder, is not God, in which case not just Catholicism but Christianity is false.

To be a Christian is to believe that “Jesus Christ is Lord.” To acknowledge him as Lord is to obey his will. And he willed the Catholic (“universal”) Church for all his disciples, for all Christians. We are Catholics because we are Christians.

Many Protestants become Catholics for this reason: They read the Church Fathers (earliest Christian writers) and discover that Christ did establish, not a Protestant Church that later became Catholic, but the Catholic Church, parts of which later broke away and became Protestant.

Suppose Jesus had not established a single, visible church with authority to teach in his name. Suppose he had left it up to us. Suppose the Church was our invention instead of his, only human and not divine. Suppose we had to figure out the right doctrine of the Trinity, the two natures of Christ, the sacraments, Mary, and controversial moral issues like contraception, homosexuality and euthanasia. Who then could ever know with certainty the mind and will of God? How could there then be one Church? There would be 20,000 different churches, each teaching its own opinion.

Instead, we do have one Church, with divine authority. As the Father gave authority to Christ (Jn 5:22; Mt 28:18-20), Christ passed it on to his apostles (Lk 10:16), and they passed it on to the successors they appointed as bishops, the teaching authority (Magisterium) of the Church. “Authority” does not mean “power” but “right”—“author’s rights.” The Church has authority only because she is under authority, the authority of her Author and Lord. “No one can give himself the mandate and the mission to proclaim the Gospel. The one sent by the Lord does not speak and act on his own authority, but by virtue of Christ’s authority” (CCC 875).

The authority of the Church has been necessary, for example, for us to know the truth of the Trinity. This most distinctively Christian doctrine of all, the one that reveals the nature of God himself, the nature of ultimate reality, was revealed by God clearly only to the Church. It was not clearly revealed to his chosen people, the Jews. It is not clearly defined in the New Testament. God waited to reveal it to the Church.

This authority of the Church, then, is not arrogant but humble, both (a) in its origin, as received from Christ, under Christ; and (b) in its end, which is to serve, as Christ served (see Jn 16) — if necessary, to the point of martyrdom. Blessed Mother Teresa’s oft-quoted saying describes these two things: “God did not put me on earth to be successful, he put me here to be faithful.”

Peter Kreeft, a professor of philosophy at Boston College, is the best-selling author of over 75 books. This column is reprinted with permission from the book “Catholic Christianity: A Complete Catechism of Catholic Beliefs Based on the Catechism of the Catholic Church” (Ignatius Press, 2001).


Catechism 101

Christ is himself the source of ministry in the Church. He instituted the Church. He gave her authority and mission, orientation and goal: “In order to shepherd the People of God and to increase its numbers without cease, Christ the Lord set up in his Church a variety of offices which aim at the good of the whole body. The holders of office, who are invested with a sacred power, are, in fact, dedicated to promoting the interests of their brethren, so that all who belong to the People of God … may attain to salvation.”

Catechism of the Catholic Church, #874

Prudence and ethical hazard

Paul Voss contends that in the current economic meltdown, irrationality replaced the reason required of the free marketplace. In order for markets to work, both honesty and reason must operate fully. In retrospect, it’s easy to blame banks and predatory lending practices. But it should be noted that consumers didn’t have guns to their heads . . .

Paul J. Voss

By definition, ethical hazard — often called moral hazard — occurs when systems or processes actually provide incentives for individuals to engage in illegal, risky or unethical behavior. Ethical hazard often occurs when individuals bear little or no responsibility for their actions.

Ethical hazard continues to flourish in our world today, often with a profound economic dimension. For example, Michael Lewis, author of the best-selling The Big Short: Inside the Doomsday Machine, keenly chronicles how ethical hazard helped contribute to the devastating mortgage crisis and, ultimately, to our current great recession. Lewis, perhaps the most insightful (and certainly the most readable) commentator on the global economic crisis, examines how easy credit and free-flowing money provided perverse incentives in a bubble real estate market—encouraging hundreds of banks to loan money (they didn’t have) to millions of consumers to buy homes (they could not afford).

In a short period of time, irrationality replaced the reason required of the free marketplace. In order for markets to work, both honesty and reason must operate fully. However, the numbers simply would not scan when applied to risky (or sub-prime) loans, losing any semblance of rationality. According to Lewis, “the interest rate on the loans wasn’t high enough to justify the risk of lending to this slice of the American population. It was as if the ordinary rules of finance had been suspended in response to a social problem.” Collectively, bankers and home buyers lost the good of the intellect.

In retrospect, it’s easy to blame banks and the so-called “predatory lending practices” used by mortgage companies. But it should be noted consumers didn’t have guns to their heads. No bank coerced them into taking out the loans. Both sides of the transaction share culpability for acting without prudence. Now that our economy appears on the slow road to recovery, what can we learn from this financial debacle?

The Catechism of the Catholic Church actually says very little about business and the pressing issues facing the world economy. In fact, with all the attention given to questions about stimulus, tax rates, unions, free markets, health care reform, welfare, unemployment, and a host of other economic concerns, the Catechism only provides rather general, even if excellent, guidelines:

“The Church has rejected the totalitarianism and atheistic ideologies associated in modern times with ‘communism’ or ‘socialism.’ She has likewise refused to accept, in the practice of ‘capitalism,’ individualism and absolute primacy of the law of the marketplace over human labor. Regulating the economy solely by centralized planning perverts the basis of social bonds; regulating it solely by the law of the marketplace fails social justice, for there are many human needs which cannot be satisfied by the market. Reasonable regulation of the marketplace and economic initiatives, in keeping with a just hierarchy of values and a view to the common good, is to be commended” (CCC 2425).

The definition of “reasonable regulation” can vary widely from person to person, and we see this tension played out each day in Washington. The emphasis upon prudence, however, remains a hallmark of the teaching. So how should we enhance prudential judgments in our lives — both in the public and private spheres?

Oscar Wilde once quipped, “I can resist anything except temptation.” Unfortunately, the world is full of temptations. Thus, the Act of Contrition reminds us to avoid the near occasion of sin. The Lord’s Prayer famously pleads “lead us not into temptation.” It’s a warning away from the power of temptation and staying clear of the ethical hazard.

The lives of the saints provide us with ample examples of heroic virtue in business. Quick trivia question: Who is the Patron Saint of Business? If you guessed St. Homobonus (Latin for “good man”), congratulations. It puts you in rare company. We know very little about Homobonus and few feel a deep connection to his patronage. We have more information, however, on St. Margaret Clitherow, a martyr from the Elizabethan period and patroness of businesswomen. Margaret was crushed to death by rocks for allowing a Catholic priest to say Mass in her home. She left behind an accounts book from the family farm and thus came about her patronage. But even the communion of saints provides only a modest number of models to emulate.

Yet, at the end of the day, we must use the general framework of the faith and the virtue of prudence (the queen of all the virtues according to St. Thomas Aquinas) in conducting business activity. Prudential judgments play a signal role in the business enterprise — from cash flows, to inventory, to expansion, hiring, product offerings, and nearly every aspect of a company. But more than ever, we need to exercise the virtue of prudence, both to recognize and to resist the lures of ethical hazard.

Paul J. Voss, Ph.D., is president of Ethikos, a professional organization offering ethics training, and an associate professor of literature at Georgia State University.