Theology, Politics & Economic Meltdown
Government Intervention or Free Market Solutions? WWJD?_____________________________________________________cont'd...
It
works by recognizing that simple arithmetic is a box and can be a
prison. Have you heard the expression “Figures lie and liars figure?”
That is true. If you want to prove something with numbers there is a
way to do it. The opposite is also true. If you want to achieve
something that is quantitatively measurable, strict adherence to
quantity can prevent the achievement.
In the Gospel of Matthew
Jesus fed 5,000 people with five loaves of bread and two fish. How did
he do that? Was it simple magic? The ancient equivalent of pulling
rabbits out of hats? Not likely. Most likely he did it by inspiring
faith among the crowd, that there would be enough to feed everyone if
everyone shared what they had, and suddenly people who had not
previously acknowledged that they had any food with them, pulled bread
and fish out of their sleeves, pockets and satchels, and once all had
contributed, there was more than enough for everyone. There were
thirteen bushels of leftovers!
Many people might say that story
supports the concept of socialism: “from each according to her ability,
to each according to his needs.” Possibly. But what’s the key
difference between the way socialism works and what happened in the
story? Force. Control.
Socialism in any of its permutations
utilizes force and control. It is administered by an authoritarian
state. It creates a planned economy. It commands everyone to “share.”
It (the government, a central authority) presumes to determine what
people need and who should give what and how much to supply that need.
And with socialism, there is never any surplus. Instead there are
shortages. Remember the long lines at Soviet or Eastern Block stores
during the Cold War? People inside the “Iron Curtain” spent most of
their free time standing in lines. And as bad as that must have been,
once they reached the front of the line it was even worse, since there
was little or no choice.
How can humanity, whose greatest
strength is creativity, ever thrive in such a system? Any truly
creative impulse is stifled. Imagination, innovation, or deviation is
considered “decadent.” Yet it is imagination, innovation, and
deviation from the norm that produces invention. Without invention, the
economy stagnates. Without individual freedom to dream, to act to break
the mold, there is no passion, no joy, no energy to produce even the
basics of an economy.
Back to the story of the loaves and
fish. Did Jesus tell the disciples, “There are people in that crowd who
are hoarding food. Go search each one at knife-point and confiscate
everything you find?” You know the answer. The “miracle” began when one
person-- significantly for the story, a child—chose to share what he
had to help others. He chose to share. Once he made that choice and his
act was celebrated and blessed, suddenly loaves and fish appeared out
of the woodwork.
The capitalist moral of this story is that in
an environment of absolute liberty, some will choose to be generous.
The energy and goodwill that is generated by that example will inspire
so much more of the same, that there will be more than enough, not just
to stave off hunger, but to satisfy appetites with plenty to spare.
“Okay,”
you say, “but what if we’re all hungry?” What if we all invested our
life-savings with Bernie Madoff? Who is left to be generous, and how
will whatever small amount these few may have, relative to everything
that has been lost, make a difference? Exactly. Isn’t that the question
the disciples asked Jesus? “But Master, we only have one small boy and
he has only five loaves and two fish. How do we feed these thousands
with that?”
Jesus replied, “When will you guys get it through your thick skulls that it’s not about the math?
“Now
as long as you’re quoting Jesus,” you say, “what about his advice to
‘The Rich Young Ruler’ to sell all he had and give to the poor? And
what about his statement that those who had two coats should give away
one?”
And I say, “Yes, but he also said, ‘The poor will always
be with you,’ to rebuke the disciples who were complaining about the
“waste” of valuable perfume Mary Magdalene was using to wash Jesus’
feet.” And the point is that Jesus said a lot of things, and like most
holy men and women, you can’t make his pronouncements add up. It really
isn’t about the math. The truth is embedded in irony. Jesus said things
that might support a complete disavowal of materialism, personal
property, certainly any sort of indulgence in luxury, and then he
turned around and celebrated the extravagance of the woman who washed
his feet with perfume as valuable as an average person’s life savings.
He celebrated the woman who had a “pearl of great price,” and affirmed
her attachment to it. And he chastised the steward who buried his
treasure in the ground for fear of market risk, and celebrated the one
who took the greatest investment risk and received the highest rate of
return.
So how do you break this down to fiscal and economic
policy in the current American moment? What is the solution to the
current economic crisis? Do we spend our way out or do we save every
penny? Do we give all we have to those who’ve been wiped out or are
unemployed? And is there a difference between what the government does
and what we as private businesses or individuals do?
Let’s think
about this for a moment. Is the government known for doing things
ethically, efficiently, or effectively? How much of every government
dollar spent actually goes to its original purpose and how much is
eaten up by bloated administration, corruption, inefficiency and
incompetence? And if the government compels you to pay taxes and tells
you how those taxes will be spent, even if to benefit the poor or to
stimulate the economy, is that any different from what happens in a
socialist or Communist society? Isn’t it the forced redistribution of
wealth? On the other hand, can any of us print money?
So the
hard-line free-marketers (though perhaps an endangered species in the
current crisis) oppose all government bail-outs, stimulus packages,
interference in markets, etc. The hard-line big government people
(currently the majority position of the moment) demand strict
regulation and extensive government intervention.
In the spirit
of full-disclosure I am a libertarian (by philosophy) and a Libertarian
(by party affiliation) which puts me close to the far end of the
no-to-low government intervention continuum. That being said, even I
cannot say with absolute confidence that there is no place for
government to act in the current crisis. It is possible that it is
absolutely essential that the government act. The question is, how
should the government act, and for the benefit (directly) of whom?
I
will come back to that question in a moment, but I also need to declare
that regardless of the answer to the first question, the second
question is equally if not more important: what should the private
sector be doing, as businesses and as individual consumers?
Again,
I return to Jesus. The world at the time of Jesus was a zero-sum
economy. Those who had money, kept it and passed it on to their heirs.
Those who had no money, had no means of upward mobility. Many were poor
due to disability and were unable to do anything other than beg. In
that kind of world, Jesus was revolutionary in telling his followers,
“Don’t just give them a pittance—put a coin in the cup, and
congratulate yourself for doing your duty. Give them your extra coat.
Or—as he said to the “Rich Young Ruler,” give them everything.
What
would Jesus say in today’s economy? Today, I believe he would be more
on the side of teaching someone to fish rather than giving them a fish.
Our economy is the opposite of a zero-sum. It is an infinite-sum
economy. Today I believe Jesus would say, “Those of you who have two
coats, buy five more and create jobs for the unemployed. Take
everything you own and expand your business, creating as many jobs as
you can. Buy a new car every two years, upgrade your house. Go out to
eat more. Keep your closet up to date. Pay someone to clean your house
or mow your lawn. Take your car to the full-service wash. Spend your
money in ways that make your life better and give other people jobs.”
Before
dismissing this as quickly as many dismissed George Bush’s “Go
shopping,” advice, think about something. It is not about the math. The
economy is a living, dynamic organism. Think of money as food for the
organism.
I grew up on a farm. That is certainly not a
zero-sum economy. The cow produces milk, cheese, butter, and meat far
beyond the amount or value of hay and oats fed to the cow. But if the
farmer were to begin to fear that he might not have a good crop year
next year and started cutting back on feeding his cows, there would be
a disproportionate effect in the opposite direction.
Therefore,
we need to understand that even counting money is not about math. I’ve
heard many people say that because the economy is “bad” and they don’t
know what might happen to them in the future, they are cutting back.
People who have the same jobs or incomes they have always had, with no
explicit reason to fear they’re at risk, are cutting back just in case.
Money we choose to hoard out of fear of what might happen later is like
starving the cow that feeds us. And we all know we can’t hoard food
forever. Food that is not consumed on a timely basis will spoil. To
save defensively is to waste. To take money out of the economy is a
lose/lose proposition. The economy needs us to shop, to buy, to invest,
to continue feeding the cow. Wealth trickles down. The best way to help
the poor in the current economy is to continue to consume—obviously
within our means, but with faith in the future.
What if the
future doesn’t warrant faith? Where the future is concerned there are
only two options. We can have faith in the future—which is essentially
faith in ourselves, in our ability to survive, adapt, thrive, no matter
what happens because we always have and because we know how. Or, we
have no faith in our ability to cope with change should it occur, and
therefore we withdraw from the economy out of fear and begin what will
eventually be a slow death if everyone else does likewise. Unless we
are wealthy enough to live the rest of our lives on the money we
currently have on-hand. Only by spending it, by feeding the proverbial
cow, can we create our future meals.
Therefore we help the
poor and keep ourselves from becoming poor by spending, even by
borrowing responsibly in order to spend more. But what about the
government?
Where helping the poor is concerned, the
government tends to favor the distribution of fish rather than fishing
education. Elected officials have short term jobs they are trying to
preserve. It takes to long to teach someone to fish. Elections can be
lost in less time. The government prefers temporary quick-fixes to
quiet the crowds, solidify the votes. Money in private hands is almost
always better spent.
Money in the hands of those who know how
to make more money, is more effectively spent than money in the hands
of those who have never had money. This is why the trickle down theory
(supply side economics) is correct. Even those who are poor benefit
when the wealthy use their money freely in the private sector to feed
the cow of the economy. On the other hand, if money is forcibly
redistributed from the wealthy to the poor, it is like starving the cow
while fertilizing the hayfield. If the cow is not well fed, it doesn’t
matter how well the hay or the oats are cared for. If the cow is well
fed, there will be more for everyone who depends on the cow.
At
the same time, the magnitude of the current problem and the
psychological factor of down-market pessimism is so pervasive right
now, I believe the government does need to act. I trust the economists
who say that a trillion dollars may be required as a stimulus to get us
out of this. So let the government print money if they have to. Let
them rebuild our infrastructure if they will. God knows it is needed.
But the best solution would be for the government to return a trillion
dollars worth of taxes taken from the economy directly to the taxpayers
and let them use their own imagination as to how and where it should be
spent. If the money went directly back to the taxpayers, the economy
would be booming again in a matter of days. Private companies would be
investing in infrastructure. People would be buying cars and the auto
crisis would be over. Shoppers would return to stores, mortgages would
be paid, new businesses would be cropping up all over. Yes, there would
always be some poor among us, but not for lack of opportunity, and
hopefully for most of them, not for long.
-jwh-