According to Anthony Annett, Ph.D., a climate change and sustainable development adviser at Columbia University’s Earth Institute, that kind of paradox is just one sign that the way we think about the economy is broken.

This spring, he’s teamed up with lauded economist Jeffrey Sachs, Ph.D., University Professor and director of the Center for Sustainable Development at Columbia, to address the problem in a new course.

At the invitation of Gabelli School of Business professor Michael Pirson, Ph.D., Annett and Sachs are teaching Modern Economics for a Sustainable and Inclusive Planet to a select group of Fordham students. The course, which is open to all undergraduate honors students, focuses on perspectives in economics that promote well-being for all on a healthy planet. Annett said the idea is to learn the philosophical, religious, and modern scientific basis of sustainable development.

It’s part of a larger rethinking of core curriculum at Jesuit business schools that is anchored in principles of Catholic social teaching and humanistic values, he said, noting that theories such as Homo Economicus and Rational-Economic Man that have influenced past generations of economists are being retired.

Having worked as a speechwriter for two managing directors of the International Monetary Fund, Annett had a front-row seat to the ways those ideas foundered, most spectacularly during the Great Recession of 2008.

“I changed tracks after the global economic crisis when I realized this was a crisis of ethics as much as a technical crisis of finance and economics. I started to get much more interested in Catholic social teaching and some of the alternative paradigms out there,” he said.

He and Sachs, a co-recipient of the 2015 Blue Planet Prize for environmental leadership who has twice made Time magazine’s list of 100 most influential world leaders, are publishing a textbook based on the class. It was planned in 2020, but the pandemic has made it feel particularly prescient. The notion that markets will self-correct is not accurate, Annett said, and it isn’t even the first time this has happened.

“After the Great Depression, people realized that laissez-faire economics did not necessarily work in the sense of being self-correcting. You can have dislocations that can last a long time and really hurt people, and that means you need the active intervention of government,” he said.

“We put a lot of emphasis on the role of government. What should government do, what are theories of government from various different thinkers? We pretty much reject the idea of libertarianism, which has influenced how economics has been developed over the past century or so, this idea that the government just needs to step aside and let the market work its magic.”

One of the course’s required readings is Annett’s Cathonomics: How the Catholic Tradition Can Create a More Just Economy, which will be published by Georgetown Press this fall. Annett joked that he’s cited teachings from Pope Francis—who addressed the topic in Let Us Dream: The Path to a Better Future, (Simon & Schuster, 2020)—so often, that he’s practically a guest speaker.

Sachs also said the pope’s encyclicals Laudato Si’ and Fratelli Tutti, which focus on sustainability and global ethics, are on his mind as he transcribes his lectures for the textbook.

“We need a new way to teach economics that addresses the core economic challenge facing society: achieving a prosperous, fair, and sustainable world economy,” said Sachs, who is the former director of Columbia’s Earth Institute.

“I’m learning an enormous amount every week, often by reading old texts that I had never read before or considering historical analogies that are relevant for our time. I’m also learning that we really can—and should—present economic issues in a new way.”

Alexios Avgerinos, a senior at Fordham College at Lincoln Center, said the class was exactly what he was looking for when he moved from Berlin to New York to attend college. He’s writing a thesis on how to structure a firm so that’s it’s not just a profit-maximizing vehicle and will be interning after graduation at a consulting firm dedicated to sustainability. With dual majors in economics and philosophy, he was intrigued by an economics course that featured Aristotle in its syllabus.

“I believe that firms hold so much power these days. Economically speaking, they’re larger than governments, so I think they can have the biggest impact to improve well-being for all people in the world.”

“When you open the Principles of Economics textbook, you are presented with all of these concepts such as utility maximization, and there are so many underlying philosophical assumptions there. You would think they don’t really matter, but they actually change the outcome in the real world.”

Annett concurred.

“In microeconomics, the standard assumption has always been that your goal, as a rational economic agent, is to maximize your preferences, which means you need to get as much stuff on the market that you like, based on your own tastes and preferences,” he said.

“We’re saying, “That’s not really in accord with what a good human being is all about. It should be about making economic choices that are good for you as a human being and good for human society as a whole.”

In his presentation to a standing room only crowd in the McNally Amphitheatre, A Moral Economy: Faith and the Free Market in an Age of Inequality, sponsored by the Center on Religion and Culture (CRC), Cardinal Tobin offered a vociferous defense of the Catholic Church’s stance on the modern global economy. The current economic order has produced unprecedented levels of income inequality, he said, and echoing Pope Francis, he noted that “people who feel abandoned will unravel solidarity” among the human race.

A Long Tradition of Weighing in

While Pope Francis has raised hackles among free market apostles with his criticisms of capitalism, Cardinal Tobin noted that Pope Pius XI weighed in on the subject as far back as 1931, and Francis’ predecessor, Pope Benedict XVI was even more forceful. Francis, while more tolerant of debate within the church than his predecessor, is equally adamant that the church has a role to play in world-wide affairs.

“More than his predecessors, Francis encourages reflection, even debate among his doctrine. He does not invoke infallibility to support his conclusions regarding social phenomenon, but he does insist that the Christian life has a soulful dimension, and rejects any attempt to reduce the response of faith to an individualistic morality,” he said.

“As a good pastor, he claims the responsibility of speaking on social morality for the good of all.”

The starting point for change, Tobin said, is at the “existential peripheries of life.”

“If you look at the injustice in the gospels, it’s not that people are overtly and programmatically oppressing the poor. They just don’t see them. That’s the point of Matthew 25. That’s the point of Luke’s story of the rich man and Lazarus,” he said.

“What does inequality really mean? A clear and humble view of it will tell us it’s people we don’t see at all, and people whom we don’t see for whom they are.”

The problem, he said, is the CEOs who embrace the idea that the day that a corporation thinks more about the good of society than it does its bottom line is the day that corporation goes out of business.

“Francis says ‘No, a just economy must be concerned with the common good,’” Cardinal Tobin said.

Both Cardinal Tobin and CRC director David Gibson acknowledged at the start of the event that it was awkward to focus on another subject in light of the sex abuse crisis that again engulfed the church this summer. The sex abuse crisis, he said, is “the bitter fruit of a toxic culture,” and Catholics have a right to be angry about it. But he said it shouldn’t result in shutting down discussions of Catholic social justice teaching.

History of the Anglo-Saxon Approach to Wealth

Jeffrey Sachs, Ph.D., director of Columbia University’s Center for Sustainable Development, delivered a response to the Cardinal’s lecture, and joined him afterword in a discussion moderated by Washington Post columnist Christine Emba.

Sachs said that although few religious traditions had directed as much intellectual firepower toward issues such as climate change and economics as the Catholic Church, its message is greeted with great skepticism in the United States. That’s because we subscribe to an Anglo-Saxon perspective on wealth that suggests that tapping into an individual’s inherent greed and is a good thing. We have Bernard Mandeville’s 1714 poem “The Fable of the Bees,” to thank in part, he said.

“He wrote a poem that said the bees have created this great hive by all of their vices being allowed to be free. This was the paradox: That by unleashing greed, which the sages had said forever should be keep under control, you would create dynamism and greatness. You would create, as Mandeville said, the “envy of all the other hives.”

Sachs said Adam Smith then took the idea, and in his 1776 treatise, The Wealth of Nations, dubbed it “the invisible hand” of the market. By pursuing their own goals, Smith posited, individuals created the collective wealth of the nation. Over time, Sachs said, this has morphed into a twisted, amoral celebration of greed, epitomized by the writings of Ayn Rand.

“So about 2,000 years of good thought that greed really isn’t good for the soul, and isn’t necessarily good for the community or what Aristotle called your eudaemonia, basically went out the window,” he said.

“In my field, we created the weirdest anthropology that said people are selfish and greedy,” said Sachs, who is a noted economist. “But that’s OK, because the invisible hand will create a prosperous society. We teach that in bad economics courses. I know, I took one.”

In his encyclical Laudato Si, Sachs said, Pope Francis connected unrestrained greed to what scientists call the Anthropocene, a period during which human activity has been the dominant influence on climate and the environment, with dire consequences.

“What Pope Francis is telling us is, we have to get the greed under control if we’re going to survive. It is blinding us to the dangers. Why is the U.S. pulling out of the Paris climate agreement? The simple line is, the president is a nincompoop, an ignorant, nasty person,” he said.

“But it’s the greed that’s doing it. It is the inability of a CEO of an oil company to say, I shouldn’t destroy the planet; I’ve got a bottom line to meet,” said Sachs. What Pope Francis is saying is, ‘No, that’s not right. The property rights, the profit, the greed motive cannot be what determines our fate; we will destroy ourselves that way.”