Prof. Franz Josef Stegmann Bethlehem Social ... - Ordo Socialis

Stegmann
Social Market Economy and
Christian Social Teaching*
INTRODUCTION
The economic concept known as "Social Market Economy" has played a central role in the
political and social upheavals that the world has witnessed since 1989. These upheavals
changed the face of Middle and Eastern Europe with profound implications for many parts of
the globe including South Africa.
The majority of people in the former communist countries considered Social Market
Economy to be the "path of hope" into a better future. I recall the slogan going around the
German Democratic Republic during (and after) the "peaceful revolution" of 1989: "If the
DM (Deutsche Mark) does not come to us, we shall move to the DM!"
On the other hand, many do not know what is meant by Social Market Economy, or what it
ought to be or to achieve. As a result, they associate it with the cruel capitalism that arose in
the 18th and 19th centuries, which did not know, and even excluded, social responsibility,
ethics, morality and social justice; these words were not even in its vocabulary. In many countries
this association is valid, based on people's experiences up to now. If only because of
these misconceptions, it is advisable and makes good sense to deal with the issue of Social
Market Economy and Christian Social Teaching. But there are still many other reasons. as we
shall see, for dealing with the subject of market economy and morality.
In the first part of this paper, I shall outline the neoliberal understanding of the Social Market
Economy (1). In this context, the theoretical concept will be the focus. Whenever everyday
economic practice does not correspond to this model, one should first inquire why it was not
realised instead of blaming the concept. I will then briefly introduce what I call European
neoliberalism and examine the reform approaches proposed by these European neoliberals in
comparison to classical economic liberalism, often called "Manchester Capitalism", and the
basic differences between both economic concepts (2). In a third section, the main aspects of
how Social Market Economy is judged by Christian Social Teaching will be presented (3).
Finally, an attempt will be made to explain what is needed from its perspective so that
neoliberal becomes a genuine Social Market Economy (4).
1. NEOLIBERAL UNDERSTANDING OF SOCIAL MARKET ECONOMY
After World War Two, in particular since 1948, the concept of Social Market Economy
gained increasing acceptance (in Central Europe and especially Germany). Neoliberal
economists and politicians such as Wilhelm Röpke, Alexander Rüstow, Ludwig Erhard and
Alfred Müller-Armack - to name a few - who had opposed the National Socialists and their
centrally planned and controlled economy, worked out the first essential traits. The Christian
Democratic Union (CDU) declared itself in favour of the concept of Social Market
Economy. 36 After the founding of the Federal Republic of Germany in 1949, Ludwig Erhard
was Minister of Economic Affairs for many years and became known as the father of the
German economic miracle. Above all, he and his long-standing advisor and secretary in the
36 See note 7.
20