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An Economic Battle for the Soul of Humanity
Authors of new book on the global economy discuss the need to reintroduce the concept of virtue to our modern era

Global Financial Crisis graphic

A characteristic of our modern era is its insistence that for progress to occur, not only are advances in science and technology necessary for the common good, but that philosophy rooted in the Judeo-Christian tradition must be negated or relegated to a second class status.  As a natural result, the battle for the soul of humanity is currently driven by what science and technology permit as possible, while the search for truth has been displaced as being sorely out of fashion, uninteresting and/or impossible, and at times even ‘harmful.’ 

These are the words of Regnum Christi members and corporate governance scholars Nicholas V. Vakkur and Zulma J. Herrera-Vakkur discussing their new book Corporate Governance Regulation: How Poor Management is Destroying the Global Economy.  Mr. Vakkur is assistant professor at Trident University in Cypress, California.  Mrs. Herrera-Vakkur is a researcher and expert on a wide range of corporate governance issues.  Below is a recent interview they granted for our Regnum Christi audience.

1. What attracted you both to Regnum Christi?

We formally pledged membership at the Atlanta RC convention in the late 90’s.  The Legion and Regnum Christi possess what is, in our view, the ideal blend of authentic, Catholic spirituality -- a desire for personal excellence and individual sanctity, an unspoken rejection of mediocrity as a way of life, combined with a degree of humility and charity that is uncommon. 

The Legion and Regnum Christi have helped us to see the beauty of Catholicism, while avoiding the inherent traps of (false) piety.  This has made it possible for us to follow our Christian vocation in a manner consistent with an authentic understanding of the human person.

2. When and why did you write this book?

Originally, we set out to empirically estimate the impact of recent corporate governance regulations (e.g., Sarbanes Oxley, Dodd-Frank) upon the global economy.  After several years of intense study, guided by prayer, our objective took an entirely unforeseen path.  It became evident that the message we were to convey was more comprehensive in scope, timely and significant.  Beyond the mere calculation of precise empirical cost estimates, we realized that
Corporate Governance Book
the global economic chaos, so pronounced in our era, is more rooted in a failed philosophy that can be traced back to the Enlightenment, rather than in economic science. 

Modern society simply takes it for granted that advances in technology and science can solve every human problem.  In essence, science and technology have become “gods.”  Our core finding suggests, at the very least, that dramatic progress in technology and knowledge, coupled with the wrong philosophical foundation, has the potential to unleash unanticipated, destructive influences upon society. 

Consider the ominous warnings issued by John Paul II, who spoke openly about the influence of a failed philosophy on human welfare.  We suggest that the same dire consequences apply to the global economy.  No matter how sophisticated the effort to manage it, it is society’s core beliefs which will determine the global economic fate.  

3. You state that the book shows how “virtue--as traditionally defined--is vital to forming a healthy global economy.”  Please explain.

A basic implication of Catholic theology is that an individual dominated by avarice is naturally incapable of acting in a manner fundamentally consistent with his or her personal welfare.  Thus, it is not difficult to show how many people like this (e.g., CEOs, bookkeepers etc.), each operating at different levels within the global economy, can affect it.  The central importance of virtue—over and above the law—is apparent as it relates to global economic health.

The increasing chaos reported hourly via the global news offers a real time glimpse into the immense economic and social penalties mankind suffers when virtue is lost.

Adam Smith once championed the idea of an “invisible hand” through which the common good would be secured for the multitudes through a counterbalance of opposing influences.  However sympathetic we may be to this basic world view, in the context of the modern climate in which lawlessness and individual license reign supreme—to a degree, that Smith himself could not possibly have envisioned—his notion no longer is applicable.

Rather, the modern ethos exemplifies the rise of individual license and insists upon the rule of self-interest.

Following the impulse which promises the greatest amount of pleasure in the immediate moment, the end result cannot be anything other than a global economic order in shambles.  It is a fragile peace that is held together only by competing power interests—a select group of multi-national corporations, global financiers, and governing bodies.  The breadth and severity of crises, not only in Europe, but also in the US (at the municipal, state and federal level), looms on the horizon.

The only logical conclusion is that the dominant ethos is direly wrong. Despite decades of unprecedented advances in science and technology, nearly every indication is that the leading global economies are heading for economic ruin rather than the prosperity. It’s clear the global economic order is now unraveling.  We suggest that its demise—whether it proves sudden or slow—may be attributed to a dramatic social shift in virtue surrendered or lost.

4.  How can companies, made up of individuals with various beliefs and backgrounds, morally deliberate?

It is important to note that corporations, no matter how large or prominent, represent only one component of the global economy.  In the book, we document a tremendous power shift has been achieved largely through new regulation in the last decade in which the government has effectively usurped authority away from the private sector.  Thus, while it is certainly true that firms must behave ethically in order for the global economic order to function effectively, the same requirement is no less vital as applied to governments. 

We try to emphasize in the book that firms do not exist in isolation.  Rather, the firm is a component of society and draws its values from modern culture.  Firms may pander to animal rights activists, for example, yet ignore the outcries of those concerned with virtue because it’s entirely consistent with the modern ethos. 

Citizens of each nation must unite in a common cause for virtue, for truth, and for the common good.  This is the only way to achieve a healthy global economic order.  At some point, the general public, long before the corporate manager or politician, must determine that some things in life are simply more important than profits.
5. Why would RC members benefit from reading your book?

Members of Regnum Christi are formally committed to the ideals posed by Truth in the modern world, and to living out a commitment to Christ and His Church on earth.  This requires a tremendous amount of sacrifice, valor and continual moral, spiritual and intellectual preparation.  Matthew 10:16 states that Christ’s followers must be “wise as serpents…”  Our book could prove beneficial as a means of grasping the nature of the battle mankind is waging for its very soul and its future.  All those who are moved out of a concern for the future of humanity should possess a basic understanding of the battle being waged as applied to the global economy and to the future of modern civilization in general.
6. One of your reviewers writes that your book could help develop an “ethical climate” rather than “focusing on regulation” in business.  Why is this important, and, in our fallen culture, is this even possible?

The short answer is that even a well-designed regulatory effort will fail if only a small proportion of the population is law abiding.  Our modern reliance upon regulation is ineffective, wasteful, and costly.  Managers will continue to shirk their duties, and in response, laws will becomes increasingly onerous and costly, with no effect.  The only viable alternative is to make a realistic effort to inculcate moral virtue in the citizenry. 

7. Your reviewers state that your “extensive research and valuable insights” will
The Vakkur Family
Merry Christmas from the Vakkur family.
help “companies and stakeholders,” and that the book is “recommended reading for policy makers, academics, students and those in the corporate word,” and for “financial researchers.” What makes this book so useful for such varied audiences?

The book is attractive to a broad audience because we use an unusual approach.  Rather than target a narrow audience with a highly specialized message, we advocate a new paradigm—one sorely needed to re-conceptualize policymaking in a manner that is more amenable to practical solutions.  Naturally, this lends to a broad audience—e.g., academics, policymakers, firm managers, concerned citizens.  It is necessary to reach a varied audience if there is to be a realistic chance of positive and meaningful change within society at large.

8.  How can people get your book? 

At the following links:





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Sponsored by the congregation of the Legionaries of Christ and the Regnum Christi Movement, Copyright 2011, Legion of Christ. All rights reserved.

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