

The following series is taken from Executive Intelligence Review V20, 
#5 and is the cover story of that issue.  For further information on 
EIR, please contact me by Email.

The anti-Christian economic doctrine
of Michael Novak
by Kathleen Klenetsky 

``No intelligent human order ... can be run according to
the counsels of Christianity.... An economy based upon the
consciences of some would offend the consciences of
others. A free economy cannot ... be a Christian economy.
To try to run an economy by the highest Christian
principles is certain to destroy both the economy and the
reputation of Christianity.''--Michael Novak, {The Spirit
of Democratic Capitalism,} 1982 

   ``{Agape@am} as a quality of human interaction is
possible only among persons or very small groups. The
character of larger group relations can be described only
rarely by mutuality but is more likely a balance of
power.''--Robert Benne, member of the board of Novak's
Institute on Religion and Democracy, {The Ethic of
Democratic Capitalism} 

   For more than a decade, Michael Novak has been
peddling the lie that what he calls ``democratic
capitalism'' is the economic and political system most
compatible with Christianity in general, and with
Catholicism in particular. In Ibero-America, where he has
traveled extensively, and systematically built up a
network of up-and-coming yuppy bureaucrats who subscribe
to his ``neo-liberal'' or ``Catholic Whig'' version of
political economy, Novak's influence has come to be
increasingly felt through such figures as Peru's champion
of the underground economy, Hernando de Soto, and the
Argentine Gustavo Be@aaliz. 
   Presenting himself as an ardent opponent of
liberation theology and of doctrinal orthodoxy, Novak has
managed to sell himself to some Catholic circles as a
spokesman for what he claims to be a shift in Catholic
social teachings toward ``market capitalism.'' 
   He has tried to portray Pope John Paul II as a
``Catholic Whig,'' by which he means a free-trade fanatic,
carefully ignoring the pope's repeated attack on the
North's looting of the South through usurious debt
payments, and has held up the encyclical {Centesimus
Annus} as proof that the Vatican has embraced ``market
capitalism.'' In an essay evaluating the importance of
{Centesimus Annus,} which was published by fellow Adam
Smith-admirer William Buckley's {National Review,} Novak
wrote, ``If in Vatican II, Rome accepts American ideas of
religious liberty, in {Centesimus Annus} Rome has
assimilated the American ideas of economic liberty.'' 

               - Anglo-American frontman -

   The truth is that what Novak preaches has virtually
nothing to do with either Catholicism or capitalism. Novak
is a bought-and-paid-for apologist for the looting
policies of the Anglo-American financial oligarchy, a
latter-day Adam Smith who, through cynical manipulation of
religious ideas, knowingly fronts for an international
oligarchy which is out to destroy not only the nationalist
institutions of Ibero-America, but also the social,
cultural, and religious influence of traditional
Catholicism, precisely because they interfere with the
totally anti-Christian policies of unbridled exploitation
carried out by the international banks, the International
Monetary Fund (IMF), and the World Bank. 
    ``Bought-and-paid-for'' is no exaggeration. Since the
mid-1970s, when he aligned himself with the emerging
``neo-conservative'' movement--which later gave birth to the
Project Democracy apparatus responsible for
destabilizations throughout the Third World--Novak has
been patronized by some of the leading moneybags in the
financial elite. 
    Novak's major base of operations since 1978 has been
the American Enterprise Institute (AEI), a Washington
think-tank that is one of the premier sources of
free-trade and pro-privatization propaganda in the United
States. 
   AEI's board of trustees, Novak's employers, reads
like a ``who's who'' of the U.S. and international banking
establishments: Willard Butcher, former chairman of Chase
Manhattan Bank; Robert Greenhill, president of Morgan
Stanley & Co., Inc.; Walter B. Wriston, former chairman of
Citicorp; and George R. Roberts of Kohlberg Kravis Roberts
& Co., are just some of its members. 
   Novak's colleagues at AEI include some of the
best-known free-enterprise nuts, ``neo-con'' activists, and
Zionist lobby operatives, including Reagan administration
U.N. Ambassador Jeane Kirkpatrick; Richard Perle; Irving
Kristol, the father of neo-conservativism; and Samuel
Huntington, a leading Project Democracy ideologue who also
authored the Trilateral Commission's controversial 1975
tract, {The Crisis of Democracy,} which called for
restricting democracy on the grounds that its expansion
would interfere with the imposition of economic austerity.
   Novak's other main institutional affiliation, the
Institute on Religion and Democracy, receives its funding
from many of the same foundations which finance AEI,
including Smith-Richardson and Mellon Scaife. 
   Novak also enjoys the patronage of such stars in the
U.S. conservative firmament as former Treasury Secretary
and Mont Pelerin Society muckety-muck William Simon and J.
Peter Grace, who, in 1982, founded the American Catholic
Committee, ostensibly as an alternative to the left-wing
drift in the U.S. Conference of Catholic Bishops. The group, which
set up Novak as its chief spokesman and became known as
the ``Novak Club,'' also included former Secretary of State
Alexander Haig and Frank Shakespeare, then vice chairman
of RKO and later U.S. ambassador to the Vatican. 
   These thugs assigned Novak the job of designing a
``religious'' argument on behalf of Anglo-American financial
imperialism that could be sold in Catholic Ibero-America. 
   As part of that effort, Novak convened a series of
private seminars at AEI in 1984. The ``problem'' he
presented to those seminars, was how to sell the ``free
market'' to two areas of the world, Ibero-America and
eastern Europe, whose Catholic culture and philosophy were
intrinsically opposed to the usury and human exploitation
that characterize free-market economics. 
   And how has he performed? In an interview published
in 1989, J. Peter Grace called Novak ``one of the smartest
people in America.'' ``Keep it in mind that Michael Novak is
somebody who converted from socialism. There's nothing
better than a converted socialist. He was active in the
party, worked on all sorts of things, and suddenly said,
`Hey, baby, this ain't the way to go.' He has written one
of the best articles on liberation theology.... And he's
the guy that was there in the middle of all this
liberation and liberal stuff. And he left it.'' 

          - Defending the `structures of sin' -

   What Novak has done is to combine Aristotle with Adam
Smith--whom he professes to be the major sources of his
philosophical and economic inspiration--and then to dress
up this nasty mixture in some Catholic-sounding rhetoric. 
   The result is about as far from Catholic doctrine as
one could possibly get. Like Aristotle and Smith, Novak
explicitly denies the possibility of creating a
political-economic system based on the Good. According to
Novak, there can be no Christian economy, and, therefore,
no Christian society. ``No intelligent human order ... can
be run according to the counsels of Christianity,'' he
declared in his 1982 opus, {The Spirit of Democratic
Capitalism.} 
   In making this assertion, Novak is guilty of a
blatant distortion of the Catholic concept of man's
imperfect nature, the heritage of original sin. The
Christian acceptance of man's imperfect nature does not in
any way imply that man is incapable of change, of
atonement, of coming closer to God. To the contrary, the
great good news that Christ brings to man is the
possibility of salvation, the hope of shedding his
sinfulness, of perfecting himself, of becoming the living
image of God. 
    If it is true, as Novak claims, that Christianity
has no real place in the world--and that {is} the import
of Novak's theories--then how does man, who lives in the
world, perfect himself? Taking Novak's view to its logical
end, the answer must be that man's ``religious'' nature is
entirely separate from his ``temporal'' nature; and,
therefore, man can act like a greedy, exploitative animal
when he operates on an ``economic'' basis, and still remain
a ``Christian.'' 
   With this outlook, can one seriously believe Novak's
claims that he is an orthodox Catholic, one who, no less,
is carrying on the spirit of such great examples of the
Church's social teachings as the 1891 encyclical {Rerum Novarum}? 
   The purpose of Novak's ``political theology'' is
to renounce the central message of Christianity. No matter
how much Novak may insist that religion has a role to play
in society, in reality he considers religion (specifically,
Catholicism) useful only to the extent that it can be
perverted into a defense of {pagan} forms of social and
economic organization. 

          - A Calvinist in Catholic clothing -

   Novak's ``democratic capitalism'' differs from
``American System'' economics as much as his depressingly
Calvinistic view of man does from Catholicism. He worships
the virulently anti-Catholic Adam Smith: ``Smith may
properly be called the father of the idea of international
economic development,'' and developing countries should
adopt his views as a model for their own economic
policies, Novak told the U.N. Human Rights Commission in
March 1981, while serving as the Reagan administration's
emissary to that body. 
   Novak has offered similar praise to Smith in
virtually every major work he's written since then,
holding him up as the inspiration for the United States'
Founding Fathers and the cause of U.S. economic
prosperity. 
    This is just another one of Novak's lies. As any
honest student of U.S. history knows, Adam Smith was a
paid agent of the British East India Company, and it was
precisely the free-trade system of British imperialism
which he extolled, which the American Revolution was
fought against. Furthermore, contrary to Novak's lying
account, the United States developed into an economic
powerhouse through exactly the kinds of dirigist policies,
typified by Alexander Hamilton's National Bank, which
Novak now insists Third World countries must reject as
inimical to economic development. 
   Trained for the priesthood, Novak began his career as
a vocal participant in the schismatic circles around Hans
Ku@aung who wished to exploit Vatican II to destroy the
Catholic Church. As a seminarian in Rome during the early
1960s, Novak wrote about the council for the liberal
American Catholic press. 
    A prote@aage@aa of theologian Bernard Lonergan,
Novak favored the most extreme forms of church
``democratization,'' (the book he published on Vatican II
was titled {The Open Church}), denounced the Vatican's
opposition to artificial contraception--a position he
holds to this day--and endorsed the Senate hearings
convened by population control fanatic Sen. Ernest
Gruening in the mid-1960s, which set the stage for the
U.S. government to get into the business of pushing
contraceptives and abortion as part of its foreign policy. 
   At one point during this period, Novak published an
article entitled ``Dual Sex Eucharist,'' in which he
advocated that women be permitted to co-celebrate the
Eucharist with a male priest to establish sexual symbolism
for Christ's union with the Church. Novak motivated this
gnostic proposal on the grounds that ``woman is a better
image of the Creator than is the male.'' Novak maintained
that the life of Christ represented ``the humbling of the
male.... The Christian man was expected to become, as it
were, androgynous--to make his own the virtue of the
feminine ideal.'' 
   Novak has traveled very little distance from his
days as a firebreathing radical who advocated dual sex
Eucharist and government distribution of contraceptives.
In {The Spirit of Democratic Capitalism,} in which he
trumpeted his embrace of the ``neo-conservative'' cause,
Novak reaffirmed his neo-malthusian beliefs, claiming that
Ibero-America's poverty, relative to the United States,
stems in part from its high birth-rate. 
    ``In computing average per capita income,'' he wrote,
``population is important in three ways. First, every
newborn child lowers the average per capita income.
Second, as the cohorts of those under age 18 
increase in proportion, the relative number of productive
workers decreases. Third, rapidly increasing populations
indicate that many parents have decided in favor of larger
families, through whatever combination of motives. This is
an admirable preference. But it has, in some but not all
respects, economic costs. {Those who make that choice
cannot properly blame others for its consequences.} Since
1940, the population of the United States had grown by 90
million, that of Latin America by 210 million'' (emphasis
added). 
    At heart, Novak was, and remains, a Calvinist
libertarian, who believes, as he wrote in his 1990 book,
{This Hemisphere of Liberty: A Philosophy of the
Americas}: ``Building an economy for saints anywhere on
earth is useless. There are too few of them. The only
realistic possibility is to build an economy for
sinners--the only moral majority.'' 

          - Building an `economy for sinners' -

   The type of economic system Novak is trying to foist
on Ibero-America, eastern Europe, and elsewhere, is indeed
an economy for sinners--the sinners being the Walter
Wristons and Peter Graces of this world. 
   Given this outlook, it is hardly surprising that
Novak never questions the lethal role which the IMF has
played in the developing sector. After all, in his view,
the IMF is merely doing its God-given job of building an
economy for sinners. 
   One of the most revealing features of Novak's
economic writings is his approach to the foreign debt
which is strangling the life out of Ibero-America and the
rest of the developing sector. Despite the fact that the
Vatican, and especially Pope John Paul II, have spoken out
in the strongest terms against the debt burden the Third
World has been forced to bear, Novak rarely touches on the
the issue. And no wonder! In those rare locations where he
has been forced to address the debt crisis, Novak has
proffered precisely those "solutions" cooked up by the
creditor financial institutions in order to maintain the
debt structure. 
   In one of his infrequent references to the matter, a
1989 presentation to an Ibero-American conference, Novak
went to great lengths to minimize the problem, claiming
that ``even worse than the `debt crisis' is the massive
`capital flight' of economic gains reaped by Latin
Americans but invested abroad.'' He then recommended a
series of unmistakably neo-colonial measures, such as
debt-for-equity swaps, and the ``restructuring of Latin
American economic systems,'' through ``opening of Latin
American economies to the economic activism of the
`informals.'|'' 
   In his various writings, Novak calls for
Ibero-America to rid itself of every remnant of
``mercantilism'' and ``statism,'' i.e., dirigism, and to
replace it with a free-wheeling, unregulated ``underground
economy'' which, he claims, can ``empower people from
below,'' but which actually undermines any possibility for
the kind of large-scale projects required for successful
and enduring nation-building. In fact, what Novak
prescribes is intended to destroy the power of the
nation-state, leaving the countries of Ibero-America
completely vulnerable to foreign exploitation. 
   In a presentation he made to a conference held in
Bogota@aa, Colombia in 1989, Novak ruled out ``large
manufacturing establishments'' for Ibero-America, on the
grounds that ``the key to the future of Latin America lies
... in one place only: the most rapid possible growth in
the small business sector.... Enterprise works best from
the bottom up.'' The conference was sponsored by the Latin
American Bishops Conference (CELAM) in collaboration with
the Anti-Defamation League (ADL)--the nominally Jewish
organization run by organized crime and the dope lobby,
which spearheaded the crusade in the United States to
force religion out of public life and which has recently
thrown its legal and other considerable resources into
defending abortion and ``gay'' rights. 
   Novak's Institute on Religion and Democracy 
churns out similar economic advice for Ibero-America.
According to IRD official Larry Adams, the institute is
promoting ``sustainable development''--the latest
euphemism for zero growth--and ``micro-enterprises'' as
models for Ibero-America and eastern Europe. In a 1991
interview, Adams revealed that the IRD had begun an
aggressive campaign the year before to get various church
organizations which raise money for eastern Europe and the
Third World to orient away from funding ``large
infrastructure projects, and instead to direct this money
into what we call micro-enterprises.'' Micro-enterprises,
he explained, involved small-scale entrepreneurship, such
as individually owned flower shops or taxis. He did not
explain how micro-enterprises could construct irrigation
systems, railroads, water and sewage treatment systems,
and other infrastructure basic to economic progress. 
    Novak prote@aage@aa Hernando de Soto is an IRD
favorite, Adams reported. ``We believe that De Soto's
ideas, what we call neo-liberalism, can be extremely
useful in Latin America and eastern Europe,'' he said,
adding that the IRD is planning to publish De Soto's {The
Other Path} in eastern European languages, as part of its
efforts to promote Adam Smith and the free market.
   Discussing the IRD's support for ``sustainable
development,'' Adams said that the institute is studying
the work of Herman Daly, a World Bank environmental
adviser and zero-growth fanatic. ``Sustainable development
doesn't have to mean zero growth,'' Adams claimed,
``although you do get into something of a dilemma when you
come to the question of population growth. Daly's
proposal is that people are entitled to have a certain
number of children, and that they can sell their right to
have children to each other, as long as the total number
of children born in any given period isn't surpassed.''
What a perfect merging of Adam Smith and Thomas Malthus! 

       - The Protestant crusade in Ibero-America -

   Novak's association with the IRD brings us to another
key aspect of his mission to ``marry'' Adam Smith and
Catholicism: the ``protestantization'' of Ibero-America.
Recognizing that the free market could not be sold there
unless the influence of Catholic social doctrine were
undermined, Novak's patrons deployed him to carry out a
subtle campaign for Calvinist ideology within the
Ibero-American Catholic Church, which would parallel the
more direct Protestant fundamentalist conversion crusade. 
   Novak was well suited for this job. During the early
1970s, toward the end of his ``left-wing'' phase, Novak
worked for one of the foundations funded by the
Rockefeller family, which has been in the forefront of the
drive to extirpate Catholic influence from Ibero-America,
in part by encouraging the spread of Protestant sects
throughout the continent. 
   After his ``conversion'' to the neo-liberal cause, Novak
intensified his efforts. 
   The IRD has functioned as a primary vehicle for this
``protestantization'' campaign. Since he helped found it in
1981, the institute has been dominated by Protestant
groups committed to encouraging Protestant missionary
efforts in Ibero-America specifically in order to spread
the dogmas of Adam Smith, efforts denounced by John Paul
II in his October 1991 visit to Brazil. 
   IRD's board members include well-known Protestant
evangelical theologian Carl Henry, Methodist evangelist Ed
Robb of Ed Robb Ministries, Dean Curry of Messiah
College, John Leith of the Union Theological Seminary, Ira
Gallaway of the Mission Society for United Methodists,
Kathy Kersten of Lutherans for Religious and Political
Freedom, and erstwhile Lutheran minister Richard Neuhaus,
who wrote the IRD's initial statement of principle.
Novak, Neuhaus, and Peter Berger, another member of
the IRD board, have long functioned as the ``religious''
triumvirate within the neo-conservative movement.
    From its inception, the IRD functioned as a de facto
adjunct of Reagan administration policy, especially in
Ibero-America. One of its first tasks was to build support
for the Nicaraguan Contras, hardly surprising given that
another of the institute's founders was Penn Kemble, a
pivotal figure in Oliver North's networks and the head of
the Project Democracy-affiliated Prodemca. 
   In an IRD Briefing Paper promoting the ``neo-liberal''
model for Ibero-America, IRD fellow Amy Sherman gloated
that ``the so-called `evangelical explosion' in Latin
America may provide a potential source of energy for the
capitalist revolution. For many Latins, their
conversion ... from folk Catholicism ... will bring
significant attitudinal and behavioral changes. These may
complement the liberal economic reforms being imposed from
above, if Max Weber's old argument linking the Protestant
work ethic to the `spirit of capitalism' holds water in
the Latin context.'' 

----
         John Covici
          [email-masked]