Check out this article from James Fitzpatrick for a better understanding of how to apply Catholic social teaching to the American economy.
Maybe time will tell who is correct. Maybe in our lifetimes. Maybe. But for the time being this dispute among conservatives illustrates why the papal encyclicals have stuck to general principles and never endorsed any one remedy for economic dislocations. Advocates of big government solutions for our economic ills are able to offer high-minded rhetoric to demonstrate their commitment to economic justice. But good intentions are not enough. The question is whether their proposed programs will do what they claim, whether they will do more harm than good. This is why the American bishops made clear in their 1992 pastoral letter Economic Justice for All that the Church “does not embrace any particular theory of how the economy works, nor does it attempt to resolve the disputes between different schools of economic thought.” The bishops recognize that Catholics must be left free to debate the debatable.