The Creative Person Michael Novak

ABSTRACT. The deepest moral justification for a capitalist system is not solely that, poor system that it is, it serves liberty better than any other known system; not even that is raises up the living standards of the poor higher than any other system has; nor tb.at it better improves the state of human health and the balance between humans and the environment that either "real existing" socialism or the traditional Third World society has. All these things, how- ever difficult for one to admit, are empirically true. The true moral strength of capitalism, however, ties in its promotion of human creativity.

New wealth can be created. Human beings themselves are the primary cause of the wealth of nations. Human crea- tivity is nature's primary resource. Removing the institu- tional repression that now stifles that creativity is the large task ahead of us,

If Pope John Paul II in Centesimus Annus did not give two cheers for democracy and capitalism, he did give at least one cheer. From a church that has passed through ma W bad systems in history, and whose main business is eternal life, one cheer for any worldly system is quite a tot. For in Christian eyes, no worldly system deserves three cheers. All are flawed. Consider democracy.

Democracy, Reinhold Niebuhr once said (even before Winston Churchill) is a poor form of govern-

Mr. Michael Novak holds the George Frederick Jewett chair in Religion and Public Policy at the American Enterprise Institute, Washington D.C. His studies in religion engage the questions of public life, political economy, education and self-knowledge. A prolific writer and commentator, he has authored scores of books and articles. He is a regular contributor to major national and international publications such as Forbes and the National Review. As Ambassador; Mr. Novak headed the U.S. Delegation to the United Nations Human Rights Commission (1981, 1982), and, Conference on Security and Cooperation in Europe (1986).

ment -- but other forms are worse. Under democ- racy, the tyranny of a majority is as much a danger to minorities and individuals as is a single tyrant. Unbridled democracy, unchecked by protections for individual rights, unbalanced, irresponsibly exer- cised, is a misfortune.

Religious power has also often been abused, espe- cialIy when intermixed with the power of the state.

It should not surprise us, therefore, that "un- bridled capitalism" and even the "unbridled pursuit of wealth creation" - indeed, an unbridled anything - arouses fears in ordinary people. This is true even of unbridled liberty of thought and expression, although philosophers might offer good reasons for laissez-faire in this sphere as in no other.

Thus, free societies in the West have in practice approached the institutionalization of liberty cau- tiously, by balancing one liberty against another. Under such practical arrangements, no liberty runs entirely unchecked. Every power is assigned its counterpower, every office its countervailing force.

The reason behind these checks and balances is a classical Christian and Jewish observation: Ever), human sometimes sins. From this fact is drawn a political principle: Trust no one with excessive power. Don't trust any institution either.

In most free societies, therefore, the three great systems of human life are placed in balance against one another, like the three points of a triangle: the political system, the economic system, and the moral/cultural system. No person and no institution can easily master all three of these forms of power, and each of them in any case has internal interests contrary to the other two. In the struggle for equilib- rium among all three systems, the hope is, no one will gain excessive power.

In our day, for example, the media of commum- cation are central to the exercise of most forms of

Journal of Business Ethics 12: 975--979, 1993.

© 1993 KluwerAcademic Publishers. Printed in the Netherlands.

976 Michael Novak

power; through them, the intellectuals, artists, jour- nalists, experts, and clergy accrue a disproportionate and novel power. Although they may exert consider- able control over public perception, they do not control everything.

In counterpoise, queens, prime ministers, party leaders, parliamentarians, judges, and political ac- tivists exercise considerable social power through the levers of the state, which today in some ways exceeds the power of all previous states. But they do not control everything - not the opinions of the idea class, perhaps not the compliance of their own bureaucracies, and certainly not economic regulari- ties, which may undo them.

Finally, leaders of commerce and industry, bankers, brokers, advertisers, labor union leaders, consumers, and many other economic agents exercise consider- able social power. But their power, too, is severely limited. For one thing, they rank low in the esteem of clergymen, intellectuals, artists, and journalists, and their failures and achievements are seldom treated without remarkable antipathy - which, I suppose, is one theme of Peter Morgan's remarks. For another, government can do more to them than they can do to government; through regulations, laws, rulings, and taxes government coerces them into compliance. Conflict between the two systems is inherently tilted toward the power of government.

The system as a whole is meant to be this way: so that its three major systems are internally divided against one another. That tripartite counterpoise is what I call "democratic capitalism". In some places, "social democracy" might be a more acceptable term, as in the historical context of 1945-48 the Germans chose the term "social market economy". By this term they meant to emphasize an analogous set of checks and balances - the market and also the constraints imposed upon it by society from several different directions. My aim is not to argue about nomenclature. The important thing is the tripartite structure of checks and balances.

In this context, the question I wish to raise con- cerns the main religious justification for a capitalist system, so understood, that is, one that is balanced by a constitutional democracy protecting individual rights, on the one hand, and by moral/cultural institutions such as those of Jewish, Christian, and humanist traditions, on the other.

For many persons, the primary moral justification

for capitalism is the free space it creates in society, the independence of property owners, the freedom of economic choices, and ample civic liberties. For others, the primary moral justification is the wide- spread social prosperity capitalism brings, ending famine and destitution, while steadily bringing about improvements in the living standards of the poor. It is not difficult to accept these moral claims as valid, at least when the only contemporary alternatives are "real existing" socialism and Third World mercan- tilism. Nonetheless, my own primary moral claim for capitalism calls attention to a different moral strength.

Permit me to take a cue from Centesimus Annus. The underlying principle of the Polish Pope's an- thropology is the "creative subjectivity" of the human person. From his earliest work on, including his phenomenological inquiry The Acting Person (for which Harvard gave him, as Archbishop of Krakow, an honorary degree), the Pope has been struck by the human being's most arresting characteristic: its capacity to originate action; that is, to imagine and to conceive of new things and then to do them. He finds in man's creative acts the deepest clue to human identity.

An unbeliever may achieve this insight with no benefit of religious belief. Karol Wojtyla approached it from two different directions, first in a philo- sophical way, second in a Jewish-Christian way. For him, philosophy and theology meet in the anthro- pology of the "real existing" human person. Phi- losophy sees homo creator; theology sees "imago Dei". Man the creator (philosophy) is made in the image of the divine Creator (theology), and is endowed by Him with an inalienable right to personal initiative.

From this principle Pope John Paul II derives a corollary for social systems: It is an affront to human dignity for a social system to repress the human capacity to create, to invent, or to be enterprising. In human "creative subjectivity", Wojtyla sees the principle of liberty, and for him this liberty naturally deploys itself in three fields - in conscience, in inquiry, and in acfon. It would be fair to say, in this respect, that Pope John Paul II is a philosopher of liberty. Deeper than liberty, however, (in his eyes) is creativity. Of these two notions, liberty alone does not satisfy; it raises further questions. Creativity must be free; but freedom is )?r something and must be ordered by something. Creativity is the deeper notion.

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So it is more accurate to think of Pope John Paul II as the philosopher of creativity. From this starting point in creativity, the Pope has over the years slowly and continuously approached that much-disputed beast, capitalism.

At the beginning of his pontificate, for example, Pope John Paul II used the word "capitalism" in a pejorative sense, as it is often used in European countries, the more so wherever the marxist tradi- tion has been strong. In his first social encyclical, Laborem Exercens, he used "capital" to mean things, objects, instruments of production. He reserved for the word "labor" all humane and virtuous attributes, including creative subjectivity.

Some years later, in Sollicitudo Rei Socialis, the Pope moved from the "acting person" and "creative subjectivity" to "the fundamental human right of personal economic initiative". This was the strongest recognition of enterprise in Catholic social thought. He saw- enterprise as a vocation, a virtue and a right.

By May of this year, in CentesimusAnnus, Wojtyla's conception of enterprise had flowered into a fully institutional conception. He had moved beyond enterprise as a vocation, a virtue, and a right to the sorts of institutions necessary for its flowering. That achieved, he moved then to a theory of the business firm; and then to a critique of the welfare state. At the heart of each of these views lies his fundamental insight: every woman and every man has been created in the image of the Creator, in order to help co-create the future of the world, in the economic and in other spheres.

Thus, the Pope emphasizes how noble it is, and how many complex talents are required, to gain insight into the economic needs of the human race, to organize available resources, to invent new re- sources and methods, and to lead a cooperative, voluntary community to achieve real results. But how can such a tong and complex sequence of actions take place systematically, regularly, rou- tinely? For that to happen, the Pope sees, a society- would need a system of free choice (markets), the broadly diffused virtue of enterprise, property at the creator's own disposal, a well-governed and ordered society of law, and relative liberty from state control. If this is what is meant by "capitalism", the Pope says in the justly famous section # 42 of Centesinius Annus, that is, "an economic system which recog- nizes the fundamental and positive role of business,

the market, private property (and the resulting responsibility for the means of production) as well as free human creativity in the economic sector", then certainly the church is quite affirmative about it.

This affirmative judgment has two conditions, however, very much like those I mentioned at the beginning in describing the tripartite structure of democratic capitalism: capitalism must be "circum- scribed by a strong juridical framework which places it at the service of human freedom in its totality" and, second, keeps capitalism in the context of "the ethical and religious core of that freedom". In other words, economic freedom must be balanced by (1) a juridical, constitutional democracy protecting indi- vidual rights and (2) a set of moral/cultural insti- tutions that embody the V/estern religious and philosophical tradition of the virtues.

Although a few theorists of capitalism concentrate tightly on the economic system alone, nearly all would freely, recognize that capitalism depends upon the evolution of law, tacit customs, responsible ethical practices, and limited government. Friedrich Hayek was tone-deaf to religion for most of his life, as he freely admitted toward the end, but in estab- lishing the possibility of the free economy he certainly affirmed the role of culture, virtue and limited government. (See, e.g., Law, Legislation and Liberty and The Constitution of Liberty.) Others among us are willing to go further than Hay& in recog- nizing the role of certain interventions by govern- ment, particularly on behalf of the poor and the vulnerable, and in order to establish the basic "rules of the game" that are necessary to the workings of liberty. Like him, though, and like Tocqueville in his fear of a new form of despotism, "soft despotism", we keep our eye on how much damage the "tutelary force" of government may do to the individual's capacity for initiative and enterprise. Democratic capitalism sets in motion a tripartite system. That system is designed to serve individuals, not indi- viduals to serve it.

In summary, the deepest moral justification for a capitalist system is not solely that, poor system that it is, it serves liberty better than any other known system; nor even that it raises up the living standards of the poor higher than any other system has; nor that it better improves the state of human health and the balance between humans and the environment than either "real existing" socialism or the traditional

978 Michael Novak

Third World society has. All these things, however difficult for one to admit, are empirically true. The true moral strength of capitalism, however, lies in its promotion of human creativity.

Here let me again dampen enthusiasm. Like democracy and like organized religion, capitalism has many faults, liabilities and worrisome tendencies. These are daily chronicled in our newspapers, litera- ture, and cinemas. Nonetheless, no other known system better cherishes, nourishes, supports, and strengthens human creativity than democratic capi- talism has done. Indeed, since its establishment in law barely two centuries ago, and then among a pitiful handful of nations, the tripartite free society (free in its polity, economy and culture) has, in the words of Marx, "transformed the productive capacity of the earth". Practically everywhere on earth - Bangladesh, for example - families are having fewer children but those children are living longer, far longer, than in any earlier time.

There is still vast hunger and destitution in large parts of the world, as there is still shocking poverty even within advanced countries. Nonetheless, so transformed have been the conditions of life - transformed by human creativity, seeking out the secrets of the earth buried By a loving Providence - that no national leader today can plausibly say: "My people are poor, and we expect that the)" will always be poor, and we accept that." Not so long ago in human history, people asserted with complacence, "The poor ye shall always have with you." Universal poverty was then no moral scandal, simply a fact of life. Today poverty anywhere on earth is displayed on television as a moral affront. So much has the human capacity for economic creativity transformed the moral calculus of humankind that grinding poverty anywhere on earth is morally repugnant. Because of this creativity, we can foresee the day when every single woman (and man) upon this earth has a firm material foundation under her feet.

This, in my view, is the inner dynamic intention of democratic capitalism as it is practiced in societies of Jewish, Christian, and humanistic culture; it is the inner dynamic of the system itself. For, based upon the capacity of humans to create and upon a panoply of institutions designed to support the full exercise of that capacity-, such a system cannot rest until every single able person is exercising that capacity. We mean by this, as Pope John Paul II writes, "a society

of free work, of enterprise, and of participation". And he also writes (in section # 32):

Indeed, besides the earth, man's principal resource is man himsel£ His intelligence enables him to discover the earth's productive potential and the many different ways in which human needs can be satisfied. It is his disci- plined work in close collaboration with others that makes possible the creation of ever more extensive working communities which can be relied upon to transform man's natural and human environments. Important virtues are involved in this process such as diligence, industriousness, prudence in undertaking reasonable risks, reliability and fidelity in interpersonal relationships as well as courage in carrying out decisions which are difficult and painful, but necessary both for the overall working of a business and in meeting possible setbacks.

Pope John Paul II sees that modem conditions are unlike those of the past, even the recent past. Whereas at one time the preeminent form of capital was land and was later the total complex of the instruments of production,

today the decisive factor is increasingly man himself, that is, his knowledge, especially his scientific knowledge, his capacity for interrelated and compact organization as well as his ability to perceive the needs of others and to satisfy them.

These texts are so truly aimed at the heart of the matter that I am tempted simply to conclude, "I rest my case." However, one important point remains to be made. To establish the moral, philosophical, and rdigious case for wealth creation is one thing; to find the practical institutions that reach all of the desti- tute, poor, and vulnerable on this planet and include them in the creative economy is yet another.

Yet isn't that itself a task for creativity? For enter- prise? For invention? In any case, that practical task appears now to be the primary vocation of all those of good will in our generation and the next. We need to think hard and with practicality about how to include the poor of Peru, Bolivia and many other Third World nations within systems that concen- trate on developing their innate human capital and on supporting it with institutions that liberate and empower it: private property, access to markets, ease and rapidity of incorporation, access to credit, prac- tical tutorials in the elements of creative economic practices, and a legal system structured to spread

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opportunity to the poor rather than (as at present) to protect the advantages of the rich.

The Third World, as John Paul II suggests, needs a thoroughgoing democratic and capitalist revolu- tion. Such a revolution is constituted by many institutional changes designed to remove the many restrictions that today repress the economic crea- tiv-ity of miltioIis of persons on this planet. This practical task is immense. I think that neither our university nor our business elites have yet begun to imagine its full practical dimensions.

Lastly, it is not those who cry "The poor! The poor!" who will enter the Kingdom of Heaven, but those who actually put in place the practical institu- tions that will help the poor to throw off their

poverty and to join other formerly poor peoples - from South Korea, Taiwan, Singapore, Hong Kong, and others - who have demonstrated that poverty is not an immutable condition.

New wealth can be created. Human beings them- selves are the primary cause of the wealth of nations. Human creativity is nature's primary resource. Re- moving the institutional repression that now stifles that creativity is the large task ahead of us.

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