By Holy See Mission
Statement by H.E. Archbishop Celestino
Migliore
Apostolic Nuncio, Permanent Observer of the Holy See63rd session of the United Nations
General AssemblyInteractive Panel on the Global
Financial Crisis
New York, 30 October 2008Mr President,
Many economists and analysts are
agreed that the crisis can be attributed to a lack of a complete and
effective regulatory system, but even more to a widespread disregard for
regulatory and supervisory structures, to say nothing of the rules of
accountability and transparency.
My delegation endorses this view
and would go one step further: the real crisis does not appear to be merely
financial, economic and technical. Rather, it extends to the broader realm of
ethical codes and moral conduct. Unbridled profiteering and the unscrupulous
pursuit of gain at any cost have made people forget basic rules of business
ethics.
Our reaction should not be
limited to deploring the crisis and offering formal expressions of sympathy to
the poorer countries and social strata which have been affected. We need to come
up with the ways and means to avoid similar crises in the future.
In some cases, governments and
institutions which rigorously implemented rules at the lower customer level were
lax in maintaining that same rigor at the higher level. The same could also be
said with regard to the economic systems of poorer countries. International
financial institutions which strictly implemented conditionalities and oversight
in developing countries neglected to do so when overseeing developed economies.
Now that the latter have collapsed, the former also have to bear the
consequences.
Government is the exercise of the
virtue of prudence in the enactment of legislative and executive measures
capable of directing social activity towards the common good. The principle of
subsidiarity requires that governments and large international agencies ensure
solidarity on the national and global levels and between generations.
A second observation pertains to
the responsibility of those who work in the financial sector. Lending is a
necessary social activity. Nonetheless, financial institutions and agents are responsible for ensuring
that lending fulfils its proper function in society, connecting savings to
production. If lending is seen merely in terms of trading off financial
resources without regard for their reasonable use, it fails to be a service to
society. When attempts are made to conceal the real risk that loans will not be
repaid, savers are cheated and lenders become actual accomplices in theft.
It must not be forgotten that at
the edges of the financial system there are retired persons, small family
businesses, cottage industries and countless employees for whom savings are an
essential means of support. Financial activity needs to be sufficiently
transparent so that individual savers, especially the poor and those least
protected, understand what will become of their savings. This calls not only
for effective measures of oversight by governments, but also for a high standard
of ethical conduct on the part of financial leaders themselves.
A third, and perhaps even more
basic, observation has to do with the general public and its choice of values
and lifestyles. A lifestyle, and even more an economic model, solely based on
increased and uncontrolled consumption and not on savings and the creation of
productive capital, is economically unsustainable. It also becomes
unsustainable from the standpoint of concern for the environment and, above all,
of human dignity itself, since the irresponsible consumer renounces his own
dignity as a rational creature and also offends the dignity of others.
Looking towards the future, there
is a need to restore credibility and authenticity to lending, which always needs
to be a part of the product chain of goods and services, and not an independent
activity.
Above all, however, there is a
need to invest in people. Once the inevitable financial salvage operations are
over, governments and the international community should invest their money in
aid to the poorest populations.
The relatively recent and
positive experience of microcredit shows that, paradoxically, those who, from
the standpoint of cold hard financial calculation, seem least suitable to
receive credit, are by and large the most serious and reliable borrowers.
The history of developed
countries also demonstrates that grants for health, education, housing and other
basic services benefiting the weakest socio-economic levels of society, families
and small communities, ultimately prove to be the most profitable investments,
since they alone ensure the harmonious functioning of society as a whole.
Thank you Mr President.
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