Podcast Summary: "Towards Reforming the International Financial and Monetary Systems"

Podcast: LSE Public Lectures and Events
Host: LSE Film and Audio Team (Chair: Professor Conor Gearty)
Guest: His Eminence Cardinal Peter Turkson, President of the Pontifical Council for Justice and Peace
Date: February 6, 2014

Main Theme

This episode features a lecture and discussion with Cardinal Peter Turkson on the Catholic Church’s call for reform in the international financial and monetary systems following the global financial crisis. Drawing from Vatican reflections, recent encyclicals, and the publication "Towards Reforming the International Financial and Monetary Systems in the Context of Global Public Authority", Cardinal Turkson advocates for a moral and ethical foundation in global economics, emphasizing the common good, global governance, and the role of faith-reason dialogue in shaping economic systems for a more inclusive future.

Key Discussion Points & Insights

1. The Church’s Mandate for Social Engagement

• The Pontifical Council for Justice and Peace was established to accompany humanity in its journey towards justice and peace by engaging with all social events, including economic crises.

  "The Council thought that he needed to engage and to shed a light of faith and ethics on this new experience.” (09:28, Cardinal Turkson)

2. Vatican’s Response to the Global Financial Crisis

• Benedict XVI delayed his encyclical "Caritas in Veritate" to address the 2008 financial crisis, reflecting the Church’s commitment to dialogue with economic and financial reasoning. (05:15–08:00)

• The Council published "Towards Reforming the International Financial and Monetary Systems in the Context of Global Public Authority", a note calling for open discussion and moral grounding in economic policy.

3. Diagnosis and Critique of the Current System

• Causes of Crisis: Selfishness, collective greed, flawed institutions, erroneous policies, and ethical breakdown.
• The result: Massive inequality, suffering, and poverty.
• The Church identifies three ideological contributors:
  • A form of liberalism that rejects regulations,
  • Utilitarianism that trusts in “trickle-down” effects,
  • A technocratic approach reducing human experience to variables.

  "No one can in good conscience... accept the development of such a situation... which basically creates a lot of inequalities in the world system." (11:16)

4. Proposals for Reform

• Suggests exploring a global public authority to manage transnational financial regulations for the common good.
• Practical suggestions include:
  • Consideration for a financial transaction tax,
  • Bridging the gap between ethical and technical training in economics,
  • Recapitalizing banks based on virtuous behavior,
  • Separating ordinary credit banking from investment banking.
• Emphasis on the principle of subsidiarity: higher authorities should only act when objectives cannot be achieved at a lower level.

  "The time had come to conceive of institutions with universal competence now that vital goods shared by the entire human family are at stake..." (17:49)

5. The Common Good as a Moral Imperative

• Defined as the sum total of social conditions allowing individuals and groups to achieve fulfillment.
• All economic activity must be oriented toward the common good, not profit for the few.
• Economic choices have inescapable moral dimensions.

  "Economics, like all sciences, contain its own truths... and the Church offers her companionship and the partnership of her dialogue of faith." (21:33)

6. Globalization and Its Challenges

• Warns against a globalization of indifference; instead, calls for globalization that promotes fair wages, decent work, and reduces inequalities.

  "Globalization should finally also mean the globalization of the common good." (26:10)

7. Practical and Theoretical Engagements

• Example: The Council’s dialogue-oriented retreat with global mining leaders was designed for self-reflection and value-oriented leadership— “mining towards the common good.”

  "People have the honor and responsibility to consider themselves as co-creators with God in the continuing unfolding work of creation." (43:00)

• Encourages academia (specifically LSE) to help design systems of inclusive economics.

8. The Need for Vision and Modest Steps

• Advocates a threefold strategy:
  • Be radical—address root causes and foundational solutions.
  • Be ambitious—aim for large-scale reform.
  • Be modest—focus on small, realistic first steps.

9. The Church’s Ongoing Commitment

• Reiterates that the crisis is a call for transformation, not despair.
• Quotes Pope Benedict XVI:

  "The current crisis obliges all of us to replan our journey, to set ourselves new rules and to discover new forms of commitment..." (46:43)

Memorable Quotes

• On the Need for Global Authority:
  “It felt that to offer a contribution to the world leaders and all people of goodwill in the face of the present world economic and financial crisis... was to engage and to shed a light of faith and ethics on this new experience.” (09:28)

• Against Inequality:
  “Some 60 years then of crisis have shown that attempts to achieve great gains for so few while ignoring the needs of very many is no longer intelligent, is no more productive, and is not even justifiable.” (15:52)

• On Inclusive Economics:
  “Business, banking and finance have to effectively orient their core activities towards the common good, towards an inclusive economic activity and economic life.” (16:28)

• On Globalization:
  “Such tragedies... are denounced and referred to as the globalization of indifference.” (24:46)

• On Hope and Action:
  “May hope be the light that ever illumines your study and commitment. And may courage be the musical tempo for keeping going.” (47:45)

Notable Audience Q&A Highlights

The Vatican Bank and Inequality (50:37–61:43)

• Q (Eric Sokolowski): What is the Vatican Bank doing to address inequality?
  • A (Cardinal Turkson): The IOR is primarily for facilitating missionary work, not profit. The Vatican’s wealth is often misperceived, and the institution isn’t as rich as rumored. The Vatican is increasing transparency and adapting to global financial regulations.

    “People then say, still, the Vatican is rich... but if you consider all of that wealth, then the Vatican is very rich. It depends on how you look at that work of art.” (56:20)

Usury and Church Doctrine (52:35)

• Q (Alfred): Why isn’t usury addressed directly in Church reform proposals?
  • A (Cardinal Turkson): Scripture doesn’t support usury. The Church is trying to promote the principle of gratuitousness—acting not always for gain, but out of love and generosity.

    “Pope Benedict wants us to imitate the gratuity or the love with which God treats us... gradually it should be possible for people to do things out of imitation of the love of God to ourselves in Christ and not always demand gains and respect.” (55:58)

Reforming the IMF and World Bank (53:39)

• Q (Susanne, Bretton Woods Project): Should religious and civil groups demand reform of institutions like the IMF and World Bank?
  • A: The Church has a history of advocating for debt cancellation (Jubilee 2000). Current aims include providing input for post-MDG goals and supporting reforms favoring the poor.

Grassroots Engagement and Inclusion (75:55–79:39)

• Q (Barbara Kentish): Should mining and financial dialogues include grassroots voices?
  • A: Cardinal Turkson agrees, recognizing grassroots pressures drive dialogue and change. The Council is working to gather input from affected communities.

  “We gave them some of the contacts that we have in places where miners are working. And the responses have come. They're collating the responses to enable us to see… the grassroots is very much, you know, we very much aware of that.” (78:33)

Transparency in the Vatican Bank (74:18–79:39)

• Q (Antonio): Is more transparency needed at the Vatican Bank (IOR)?
  • A: Acknowledges past problems, explains actions already taken towards compliance and transparency.

    “The Vatican is now accepted all the requirements from international financial system and organizations... fulfilling all the conditions that the financial organizations are asking for.” (87:30)

The Individual as "Consumer" or "Citizen" (78:10)

• Q (John Alexander): Should we rethink the language used to describe individuals (consumers vs. citizens) in society?
  • A: Cardinal Turkson agrees, noting ongoing research on such concepts and their meanings.

Timestamps for Key Segments

• [05:15] Cardinal Turkson begins main lecture
• [09:28] Description of the Vatican “Note” and engagement with G20 financial leaders
• [15:52] Clarion call against inequality; stats on global wealth
• [21:33] Exploration of the common good as the foundation for economics
• [24:46] Quoting Pope Francis on the “globalization of indifference”
• [36:40] Example of industry dialogue – mining leaders’ retreat
• [41:40] Call for LSE to lead in designing inclusive economies
• [46:43] Concluding call for hope and courage
• [50:37–53:39] First audience Q&A round (Vatican Bank, usury, IMF/World Bank reform)
• [61:43–79:39] Extended Q&A (topics: Vatican Bank transparency, grassroots inclusion, mining, language, high-level Church politics)
• [88:21] Wrap-up and thanks

Tone & Language

The conversation was thoughtful, philosophical, and deeply ethical, with Cardinal Turkson mixing references to scripture, Church teaching, economic theory, and recent papal statements. His tone was humble, invitational, and open to dialogue—underscoring the Church’s desire to collaborate with secular institutions and civil society.

Conclusion

This episode offered a rare window into the Vatican’s approach to global finance, advocating a reorientation of economic life toward the common good. The discussion balanced practical examples with philosophical reflection, and fielded challenging questions on Church finance, systemic change, and moral leadership. Listeners are left with a compelling call to integrate faith, reason, and ethics in the urgent project of economic reform.