Summit Ministries
August 7, 2013
Every liberal economic policy is predicated on the assumption that
coercive governments are morally superior to free markets. But how would
progressives react if they realized the exact opposite is true?
Bad economic ideas lead to bad — and immoral — economic decisions. As the
Acton Institute’s Dr. Samuel Gregg puts it in
Becoming Europe,
quoting economist Arthur Brooks, the goal of a free market system of
economics is not “the endless acquisition of wealth.” Rather, it is
human flourishing
1
— our ability to, inasmuch as we can after the fall, be fruitful and
multiply, fill the earth, and rule over creation (Genesis 1:28).
The Bible doesn’t instruct us on specific tax policies. Nowhere does
it prescribe what percentage of gross domestic product the federal
government ought to be spending. But it does give us a framework from
which to orient our economic thinking: people are made in the image of
God and carry inherent dignity and the ability to produce good things.
Economic systems that affirm these truths lead to human flourishing.
It’s for that reason that the free market system, when coupled with
personal virtue and community responsibility, better aligns with a
biblical worldview than any other economic system. Christians ought to
learn to articulate this: what is immoral is not the free market system,
but the diminishment of opportunity and dignity when it is corrupted by
greed or destroyed by power.
As
New York Times bestselling author and Summit faculty
member Jay W. Richards recently said in an interview with Summit, “If
we, as Christians, care about people, economic reality is something that
impinges on people in a thousand different ways. We need to learn
something about it.”
Our Economic Responsibility Includes Learning Basic Principles
Aside from basic economic principles like the law of supply and
demand or the function of price in a market, two key principles can help
us rightly order our economic thinking.
1. Prudence
As Richards says in
Money, Greed, and God, “Prudence means to ‘see reality as it is and to act accordingly’ to conform your mind, and then your actions, to reality.”
2
Elsewhere in the book, Richards recounts the story of Bob Geldof, who
helped organize movements in the 1980s to fight poverty in Africa,
including Live Aid and Band Aid. Those movements have done little to
lift struggling nations out of poverty, mostly because they
misunderstand what creates prosperity. Geldof’s take: “Something must be
done, even if it doesn’t work.”
3
Well, his plan didn’t work. Unthinking aid creates lifelong
dependence and stamps out the entrepreneurial spirit of whole nations.
Though his intentions were good, the outcome was deeply immoral. “We
spend too much time focusing on what we mean to do and what we like to
do instead of putting serious empirical work into what’s actually going
to work,” Richards said in an interview.
2. Subsidiarity
The principle of subsidiarity goes back to medieval thinker Thomas
Aquinas. Subsidiarity claims that it is wrong for a “larger or higher
association” to step in and try to fix a problem when an institution
closer to the issue can act.
4
So, for example, when a young family finds itself in trouble, it’s
inappropriate — even unjust — for the state or federal government to
provide aid when extended family members, a local church, or neighbors
can help the family in need.
This principle has significant implications for fighting poverty. In
the face of federal welfare, poverty rates in the U.S. have remained
between 12 and 15 percent for the last fifty years. Prior to President
Lyndon Johnson’s welfare programs, local communities were primarily
responsible for taking care of the poor. Poverty was actually on the
decline in the years leading up to Johnson’s War on Poverty; federal
welfare halted that decline.
5
Economic Responsibility Also Means Having the Right Cultural Values
In Becoming Europe Gregg pinpoints the differences between European
economies and that of the U.S., demonstrating how the U.S. can avoid
plunging into the sort of economic crises in which Europe currently
finds itself. At the root of Gregg’s argument is a study of the cultural
values that undergird economic realities. As Gregg puts it, “. . . any
given economic setting . . . is influenced by a range of value
commitments, ideas, and movements.”
6 In other words, economies serve as cultural barometers for their respective countries:
A market economy, for example, relies on processes such as
market prices and the exchange of goods and services, institutions such
as private property and rule of law, as well as actions such as
innovation and economic entrepreneurship. Note, however, how every
single one of these economic processes, actions, and institutions
assumes a commitment to freedom.7
As Gregg explains, top-down economies necessarily restrict freedom,
ignoring prudence and subsidiarity and thus denying essential truths
about humans and the
imago Dei. Ignoring these realities, in
turn, creates a negative view of entrepreneurship. A biblical view, on
the other hand, begins with God as creator. Bearing his image, we too
know how to create. God wants abundance; bearing his image, we are by
nature equipped to produce more than we consume.
Thus, coercive economic policies have the effect of suffocating the
entrepreneurial impulse. In the European Union 45 percent of citizens
preferred to be self-employed, while 46 percent preferred to be an
employee. What happens in a nation when a majority of the citizens
expect others to take care of them instead of taking responsibility
themselves? Interestingly, too much economic despotism may actually
cause people to wake up to their servitude. In China, where citizens
have lived under severe state planning, entrepreneurship is much more
highly valued: 71 percent of Chinese citizens preferred to be
self-employed, as opposed to 28 percent who said they wanted to be an
employee.
8
So is it possible to avoid Europe’s path? Gregg says yes, but only if
we affirm five values that stave off an immoral economic despotism and
create an environment for freedom and flourishing:
- Wealth Creation Over Wealth Redistribution. History
— and the principle of subsidiarity — shows us that people benefit when
they can work to improve their lots themselves. This value affirms the
fact that God made people to be co-creators of culture, not passive
consumers.
- Accountability and Transparency: Truth Over Falsehood.
In a true market economy, people are held accountable for poor economic
decisions by the outcomes of those decisions. A culture of bailouts and
corporate welfare undermines this value.
- Justice: Rule of Law Over Rule of Men. None of
these values will amount to much if the government fails to enforce just
laws. In addition to protecting the innocent and punishing wrongdoers,
securing justice provides a climate of stability in which wealth
creators can reap the rewards of their risk and create greater
abundance.
- Property Rights Over “Dirigisme.” Dirigisme is
simply the government stepping into the private sector to directly
manage wealth. Leaders who regularly threaten to diminish private
property rights create uncertainty, diminish investment, and generate a
climate of fear.
- Hope Over Fear: Openness vs. Defensiveness. Productive people are not the bad guys, and our government ought to stop portraying them as such.
So how do we reclaim the moral high ground from those advocating leftist policies? Bill Whittle thinks he knows. Bill is the “
Virtual President” whose mock presidential addresses have gone viral on the Internet for articulating what our president
should
say. Whittle suggests using simple questions to communicate three
central components of free market morality: freedom, private property,
and virtue:
- On freedom: ask, “Are you the kind of person who wants to be left
alone, or are you the kind of person who likes to tell other people what
to do?” Leftists assume that they are so smart that they deserve to
coerce the rest of us. But very few people will admit to wanting to be a
busybody.
- On private property: ask, “If you believe in ‘From each according to
his ability, to each according to his need,’ are you willing to donate
your smart phone and other possessions to charity? How can you justify
eating every day when others are starving?” Why do they expect others to
make their sacrifices for them?
- On virtue “Do you believe it is okay to hit someone and take their
stuff if they have more stuff than you do?” If it is not okay on a
personal level, it’s not okay for governments to do it either. Obviously
we all must pay taxes. But to base tax policy on jealousy is to
institutionalize theft.
People may not have a clear idea of what freedom, private property or
virtue are, but when you put these simple questions to them, you’ll
leave them thinking. You might even get them to see the moral basis of
the free enterprise system.
Notes
- Samuel Gregg, Becoming Europe: Economic Decline, Culture, and How America Can Avoid a European Future (New York: Encounter Books, 2013), 300.
- Jay W. Richards, Money, Greed, and God: Why Capitalism is the Solution and Not the Problem (New York: HarperOne, 2009), 46.
- Ibid, 45.
- Ibid, 51.
- Ibid, 47.
- Gregg, 41.
- Ibid, 8.
- Ibid, 19.