Archive for capitalism
Guest post by C. Jay Engel of the Reformed Libertarian.
The anti-free market proclamations from the left (and even sometimes the right) come in all shapes and sizes. Among the more common of these proclamations is the one that I heard yesterday. As far as I can remember, this is what was said by the individual (to her friend) next to me. “Capitalism is problematic because it is an entire system based on greed. If we want a healthy society, we should not seek to adopt such a system. We need a system that is based on cooperation and love.” That capitalism is a system built on greed is a claim that is often heard and the theme has been pushed at every level of society; from the politicians, the educators, the commentators, the media, and the average Joe.
It is immediately clear that there is a dichotomy here between cooperation and capitalism, a dichotomy that should immediately raise the red flags of the libertarian. After all, aren’t we always saying that the economy is most ethical when it is completely voluntary? And does not voluntary interaction and exchange form the basis for capitalism? The problem sits in the misunderstanding of the very nature of (free market) capitalism. This capitalism is not the same as the fascist system we have today. The American system of corporatism, that has largely existed since the nineteenth century, should never be confused with the free market.
Review of Daniel M. Bell Jr., The Economy of Desire: Christianity and Capitalism in a Postmodern World (Baker Academic, 2012), 224 pgs., paperback.
This is the sixth volume in the series The Church and Postmodern Culture, edited by James K. A. Smith. The series “features high-profile theorists in continental philosophy and contemporary theology writing for a broad, nonspecialist audience interested in the impact of postmodern theory on the faith and practice of the church.”
Although I am not the least bit interested in postmodern theory, I am very interested in the intersection of Christianity and economics or politics. Thus, the phrase “Christianity and Capitalism” in this book’s subtitle caught my eye. Nevertheless, I have never been more disappointed, or bored.
The author describes his work as “a contribution to the conversation about the relationship of Christianity to capitalism with a postmodern twist.” That twist is nothing short of pure Christian anti-capitalism, although of a very unique kind. You see, Daniel Bell, professor of theological ethics at Lutheran Theological Southern Seminary and the author of several books, is not a socialist. He maintains that his book “changes the focus from capitalism versus socialism to capitalism versus the divine economy made present by Christ and witnessed to by the church.”
Fortunately, I didn’t have to read through the whole book to discover what the author meant by capitalism. He equates capitalism with the “free-market economy” because the name “highlights the centrality of the market.” This is well and good, and certainly makes it easier to understand where the author is coming from. Unfortunately, this is not the case for understanding Bell’s concept of the divine economy. Read More→
It’s probably no stretch for me to say that I share a common frustration with other libertarians when I hear capitalism take the blame for all of the world’s economic woes. My Progressive Christians friends decry the economic systems that have been constructed in the past several hundred years as running counter to the kingdom of God. Their chastisement is aimed mostly at the predominantly capitalist United States and its economic domination over the world’s resources. Economic disparity is blamed on our empathy-free addiction to consumerism. Children in the developing world are slaves, so the narrative goes, so that we can have very nice things. If we weren’t so caught up in our stuff, they wouldn’t be slaves (to which I respond: no, but they’d be just as poor or worse!).
My blood pressure goes up every time I see somebody blame “capitalism” or “the free market” for social and economic problems. Maybe I should stop expecting Facebook memes to be intelligent and thought-provoking, especially if individuals posting them have spent fewer than ten seconds studying economics. But perhaps I should let go of my commitment to the ideal of capitalism and embrace whatever-it-is-that-frees-humanity. My friend Mike is one of “those people” who blames many social ills on capitalism. He and I have argued in circles about whether or not capitalism is to blame, and I have failed to convince him he’s using the wrong word.
What do we call the economic system of the United States?
Is it capitalism?
Or maybe the better question is to ask, does it matter?
Shouldn’t our passion for liberty be able to withstand the poor reputation it has been given by others? Can we not be committed to liberty while also sharing a commitment to the common good?
That last question might make some libertarians wince, because the phrase “common good” is often used by the Left to trump our commitment to individualism. But stop and think about it. One of the astounding facts of the 19th and 20th centuries is the phenomena that individuals acting in a (relatively free) market results in cooperation and the creation of wealth that opens the floodgates for the masses to rise out of poverty. A commitment to individualism is not a rejection of the common good.
Back to labels. Let’s take an example using Christianity. Many people blame Christianity on some of history’s greatest atrocities. Are they right to do so? Is it truly our heritage that Christians have killed people in the name of Christ? My honest response is, “Yes, it is.” At the same time, the individual persons in certain Christian sects who perpetuated violence and aggression do not represent what it means to be a true Christ-follower. In that sense, it is not the “Christian tradition” that carried out violence, but a misapplication of allegiance to the name of Christ.
We must be free to both reject those parts of our tradition that stray from the ideal while simultaneously admitting that those stories are part of our historic identity, for better or worse.
I think the same should be true for libertarians. We can and should both espouse what real free markets ought to look like while at the same time admitting that some individual advocates of capitalism have abused their own freedom to suppress the freedoms of others (think Federal Reserve or corporate welfare). Under certain types of manipulated market conditions, it is no wonder “capitalism” hasn’t quite worked out as well as we would expect. It is not that we believe capitalism has been tried and has failed, but we recognize society’s inability to apply liberty consistently. It’s no secret that some who are successful can buy political power to manipulate markets, so it is no surprise that such a “market capitalism” has negative outcomes.
I’ve long maintained that Progressive Christians and Libertarian Christians have more in common than either would like to admit. What makes them feel so far apart is that both have distinct spheres of language (simplistically state: collectivist vs. individualist). That’s not a small hurdle to overcome. It would take good listening skills and long conversations to overcome it indeed! But consider this: both groups reject economic domination of one class of people over another. Both abhor war. Both cry out against Big Business and are sick of corporate welfare. That’s a lot of common ground, isn’t it?
Whether one wants to throw out capitalism (the system) or let go of “capitalism” (the name), the common good can be a common goal. (Anarchists, take a deep breath!) Yes, there are competing theories on how to get there. But that’s where the fun begins. That’s where we get to wrestle with the details and the empirical data. That’s how we keep the Great Conversation moving forward. Here’s a starter conversation: can Libertarian Christians admit that “societal sins” are real and can be addressed by a consistent ethic of liberty? And can Progressive Christians admit that a monopoly (the State) is not the best way to address and fix those sins?
Many libertarian and free-market economists offer a unique perspective to social problems. Like Art Carden, we believe that “the important question in social science is not really evaluating the moral quality of the outcome, but evaluating the institutions that produce the outcome.” And we stand with F.A. Hayek in affirming that “the curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”
Originally posted at the Values & Capitalism Blog.
“The idea that churches can tackle national poverty, take care of those who are ill, and rebuild communities after natural disasters requires a spoonful of bad moral theology and a cup of dishonesty.” - Robert Parham
In a recent blog post, EthicsDaily.com editor and Executive Director of Baptist Center for Ethics Robert Parham claimed that churches and charities could never do enough to alleviate poverty. I agree.
Poverty will never be “tackled” because it is a relative term; a moving target. If you could describe the plight of America’s poor today to a poor person in another country, or an American 100 years ago, they would conclude that poverty had been eliminated. The standard of living among the poorest Americans today is incredible by world and historical standards. Yet we still wage the war on poverty, even in America. This is not a bad thing – helping the down and out can be wonderful and is something Christians are called to. But when we aim at targets like the “end” of poverty, there is no end to what we can justify in order to reach this impossible goal. “The poor will always be with you.” The question for Christians is how best to reach them, spiritually and materially.
The second reason I agree with Parham’s claim is that, to the extent that poverty can be reduced, the church and private charity alone are simply too small to do it. The incredible gains in social and material welfare of the poor in America have not primarily resulted from charity, churches or governments. They have resulted from (mostly) free-market economies.
If we look at poverty in a vacuum as Parham does and ask how private charity compares to government efforts, we could conclude that private efforts are too small. But if we look at government and private efforts combined compared to the power of the market, they would be dwarfed so as to make them hardly important in the big scheme. Charity is a targeted and short-term salve for the wounded; its value is far more in its spiritual nourishment than any material progress it brings. A vibrant free-market is the only institution powerful enough to bring about the kind of dramatic increases in standard of living that most of us wish to see.
Jumping from the premise that private charity is not enough to the conclusion that government must do something places a blind, sometimes idolatrous faith in government that counters logic and experience. The incentive structure in government departments is to perpetuate and grow regardless of their effectiveness or the need for their services. There is no check on whether or not they are effective. In fact, the less effective a bureau of poverty relief is, the more they are rewarded with bigger budgets. If poverty is on the rise, and they will always claim it is so as to increase their importance, the last thing to do is cut the department of poverty relief!
Government programs are also subject to “capture” by interest groups and politicians. Scratch the surface of any government program and you will find that it is not the “general welfare” being promoted, but the welfare of a very small and politically connected group at the expense of the general welfare.
To examine private efforts and claim they cannot tackle a problem is only half the analysis needed. We must also examine government efforts and ask if they can tackle the same problem before we charge them to do it. The field of Public Choice Economics does just this, and you would be hard-pressed to find a case where the market is not providing something and getting government involved makes it better. If Christians have a duty to help the poor, they also have a duty to use their brains to discover ways that actually work. Intentions and actions are not enough, we need to understand how to be effective. This requires some knowledge of economic and political systems.
Wrong about Rights
The most damning and least supported claim in Parham’s article was that it is wrong for a Christian to value other people’s property rights:
“[L]ibertarian morality values property rights over human rights. For a Christian, that’s bad moral theology.”
I beg to differ. What Parham leaves unexplained is how human rights are to exist absent property rights. Private property is not some sacred dogma for its own sake; it is important because there is no other method of peacefully settling competing demands for limited resources. Such resources include food, water, shelter and other necessities of life. Common definitions or human rights include the right to be free from hunger. How can you have this right if you have no right to the very food you need to survive?
If Parham means by human rights the right to food, shelter, health care and other positive rights, this poses an incurable conundrum. Positive rights are a logical and practical impossibility. They cannot coexist with negative rights, or even with other positive rights.
A positive right is a right to something. A negative right is a right from something. A positive right obligates another person to take action. A negative right prohibits another person from taking action. A right to life, liberty or property is a negative right. You are free to live and act and justly acquire property, and no one can prohibit that so long as you are not violating their rights. A right to health care is a positive right. If you have the right to receive health care, someone else has an obligation to give it to you. If I am a doctor and you say you need my services, I am obligated to assist you in a world of positive rights. But what if at the same time I am hungry and need to eat rather than assist you in order to maintain good health? Our positive rights to health care cannot both be fulfilled, and in order for one of us to fulfill them we’d have to violate the other’s negative right to liberty and property.
Indeed, it is not possible to have any moral theology whatsoever without an acceptance of private property. One cannot give generously what one does not own, and one cannot help another by stealing from him.
Means and Ends
To sum up the argument, the author couldn’t imagine the church doing a task to his satisfaction, so his response was to ask men with guns to take money from people who presumably wouldn’t part with it voluntarily, and give it to causes he valued. Everything government does is backed by threat of force. Indeed, that is the only thing that distinguishes government from all other institutions. Let’s remove the intermediary agents (IRS, law enforcement) and revisit the argument with the author as the principal actor:
Churches can’t or won’t do as much to help the poor as Parham wants so he takes a gun door to door and says, “donate or else.”
That’s clearly a barbaric and inhumane way to a more civilized and humane world. Yet voting for people who will appoint people who will hire people who will send threatening letters promising agents with the ability to use lethal force if money isn’t sent to some other agents to spend on social causes is no different in moral terms. The means of the kingdom of God are service, sacrifice, grace and love. The means of all earthy kingdoms are brute force and the threat of it.
When the rich man refused to sell all his possessions and give the proceeds to the poor, Jesus did not send Peter and John after him to extract a percentage on threat of imprisonment. He let him walk away. We are to do the same.