JPMorgan Chase & Co. (NYSE:JPM) economist James Glassman responded to Pope Francis’s sharp criticism of capitalism. James Pethokoukis of the American Enterprise Institute put out Glassman’s response in his blog post. Without naming Pope Francis, the JPMorgan Chase & Co. (NYSE:JPM) economist defended the free-market economy by showing how it has helped people improve their lives.

JPMorgan banks

Pope Francis ignored these facts?

Glassman said that those groaning over global poverty should thank the modern economy instead of complaining. People complaining about poverty in the free-market economy ignore several key facts. One, poverty isn’t something new. It’s been there for millions of years, and people in the past suffered more hardships than today. Two, developed countries are still emerging out of recessions. Central banks have come up with favorable policies. As developed economies recover, people affected by the recession should be restored.

And third, despite the economic ups and downs of developed economies, the standard of living has improved substantially. And it’s currently at the highest level known to economists. So, market-oriented economies have clearly done a lot more than anything else in the past to cure poverty. Critics of free-market economy usually see it as a system that follows “survival of the fittest,” but ignore many fundamental factors of the modern economic system.

For example, a breakthrough technological innovation is considered as a destroyer of jobs. But people fail to see that technological advancements create new economic frontiers. The benefits of innovation such as new jobs, new industries and higher living standards are clearly ignored.

JPMorgan economist on today and yesterday

The JPMorgan Chase & Co. (NYSE:JPM) economist admits that times are challenging for a lot of people due to the recent business cycle (recession), technological changes and new competition from emerging economies that are replicating the developed economies. But, in most cases, today’s challenges are nowhere close to what our predecessors have faced over the past few centuries.

And free-market economies constitute only Canada, Western Europe, Taiwan, Israel, Japan, the U.S., New Zealand, South Korea, Australia and a few oil-rich countries in the Middle-East. And they account for only 15% of the global population. Now other countries have a chance as they push for aggressive developments.