Ramesh, viewed in isolation, the Pope’s remarks can be seen as a reflection of the fairly traditional Roman Catholic corporatism that lies, I’d guess, at the base of his economic thinking. That’s a doctrine that is in many respects profoundly antagonistic to classical free -market liberalism, but coming from a pontiff, and, not only that, a pontiff who has spent most of his adult life in a country run on the “Rhineland” social market model, it’s far from a surprise.
The trouble is that you cannot view those remarks in isolation. The Spanish economy is in a mess, thanks primarily to the distortions introduced by the euro and, of course, deep structural problems of the type identified by Richard Epstein. Resolving those problems will be difficult. That’s why a good number of Spain’s indignados (if not — yet — the wider electorate) have found it far easier to scapegoat a wicked, if ill-defined “capitalism.” By saying what he did, where he did, and when he did, Benedict XVI, maybe inadvertently, maybe not, has risked giving that scapegoating a credibility in a constituency that it might not have otherwise reached. That’s a pity.