Vatican newspaper says crisis shows failure of ‘new economy’

VATICAN CITY (CNS) — The current financial crisis pummeling the United States and beyond is a sign that the so-called “new economy” and its risky investments have failed, the Vatican newspaper said. The booming growth of financial markets did not correspond to real growth or concrete development for society because it created an artificially robust gross national product, said a Sept. 24 article in L’Osservatore Romano. The only real growth registered in this crisis has been “the commissions, profits of the banks and bonuses for the managers,” it said. The article, with the headline “A costly illusion,” was written by Ettore Gotti Tedeschi, an Italian economist and professor of financial ethics at the Catholic University of the Sacred Heart in Milan, Italy. The U.S. financial meltdown has been blamed on “the greed of managers and lack of regulations. But curiously, no one ever refers to the indirect responsibility of the government’s economic policy” which, he wrote, tried to cover the lack of any real economic development with a booming Wall Street.

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