The Pope and Entrepreneurial Capitalism

sep pope“In order to continue providing employment, it is imperative to promote an economy which favors productive diversity and business creativity.” Those are the words of Pope Francis, who arrived in Washington, DC last week.

Much has been made about Pope Francis’s relatively recent criticisms of capitalism and profit as a motive. However, he toned down the rhetoric on his latest speeches – even praising “the spirit of enterprise” in his address to a joint session of Congress.

In their book Good Capitalism, Bad Capitalism, and the Economics of Growth and Prosperity, William J. Baumol, Robert E. Litan, and Carl J. Schramm point out that there are four capitalist systems: oligarchic capitalism, state-guided capitalism, big firm capitalism and entrepreneurial capitalism. The latter, it seems, is what Pope Francis supports with his subtle calls for innovation, value creation, and tapping the creative genius of the young. 

In his July Latin America tour, he encouraged the young to work on what drives them and make it their lives’ goal, giving their all to their projects. Jorge Mario Bergoglio, an Argentinian Jesuit, is considered a risk-taker himself. He also calls for reforms in government institutions while pursuing reform of the Catholic Church itself.

While he has fiercely criticized economic excesses, he stops short of anti-capitalism. “Business is a noble vocation, directed to producing wealth and improving our world,” he wrote in Laudato Sí.

Earlier this year, Pope Francis, who declared himself to be a technological dinosaur, surprised everyone at an event on education in February 2015, when he suddenly spoke about innovative startups and announced the creation of an accelerator within the Vatican, Scholas Labs. This accelerator will welcome ten projects per year, with the criteria being that they leverage technology to improve education around the world. The four-month "acceleration" program includes mentoring, funding, visibility, networking, and other tools to help transform the original idea into a concrete solution. This nonprofit initiative is supported by major technology companies like Google, Microsoft, Telecom group and the Argentine Globant.

The Pope made news in May 2015 for his encyclical letter, which addressed the perils of global warming. Will he next call for entrepreneurs to step in to solve some of those environmental challenges? Perhaps that might be too much to hope for but we should welcome his calls for innovation and creativity while thinking of those who do well by doing good.

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