Christianomics

This post is about something I've been thinking about for a while and may be longer than usual, so hang in there as I ramble. With the economy the way it is and the election looming, it seems appropriate to talk about economics from a Christian perspective.

Adam Smith and the Invisible Hand

Adam Smith in the Wealth of Nations described capitalism as an "invisible hand", through which the selfish behavior of men benefited the society as a whole.

As every individual, therefore, endeavors as much he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labors to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.

Contrast a restaurant that you've been to that has really good food and good service with a restaurant that has poor service, poor quality food, or both. Which one do you visit the most? The good quality restaurant will typically be in business for longer, have more customers, and make more money than the poor quality restaurant. For the selfish reason of making more money, there is an incentive to provide something that benefits others.

Now think of a socialist, or perhaps, communist economic system. Imagine the extreme that the government owned all restaurants, hired cooks to run them, taxed the citizenry to pay for them, and then "gave" the food away for free. Is there now incentive to provide good quality and good service?

A Christian Perspective

Inherent in the example above and in Adam Smith's quote is the Biblical truth that man is sinful.

As the Scriptures say,

"There is no one righteous, not even one;
there is no one who understands,
no one who seeks God.
All have turned away,
they have together become worthless;
there is no one who does good,
not even one." ^[1]

I believe that the best economic system to promote good when man is sinful is capitalism. Socialism and Capitalism both deny the truth of man's sinfulness. The reason they don't work very well is because of this truth.

Some of the principles promoted by capitalism are indeed Biblical. For example, 2 Thessalonians 3:10 says "For even when we were with you, we gave you this rule: 'If a man will not work, he shall not eat.'" (Note that it says "will not work", not "cannot work". More on that below.)

Rising Above Capitalism

The standards for a Christian are higher than any economic system, however. For a Christian, doing good is something we do to bring glory to God rather than to benefit ourselves. While in business, we work to provide for our families and we should do that work to the glory of God and for the benefit of others. However, we are also called to give out of love for Christ, to help those who truly need.

Give to the one who asks you, and do not turn away from the one who wants to borrow from you. ^[2]

The Church or the Government

Our economic system is the best there is at, as one friend of mine said, "exploiting" the sinful human nature for the good of society. It benefits others buy both providing quality goods and services that others need, but the jobs that are required to produce these when success comes to the producers. As someone once said, a "rising tide lifts all boats".

However, this is never sufficient to truly lift all boats. As Jesus said in Matthew 26:11, "The poor you will always have with you". This means that people need help. I believe the church (i.e., Christians, the body of Christ) can better provide help where it is really needed than the government. Also, this is the most compassionate answer to the problem of need. Which requires more compassion, to give from your own resources (which are really God's anyway) or to lobby that the government give from the resources collected from someone else?

The government has to treat all needs the same, whether real or perceived. The church on the other hand, can discern real needs from perceived, and meet people where the real needs are. The man who has lost all his money due to his gambling addiction may get a welfare check from the government. From the church he may get a bag of groceries, accountability, and spiritual help to overcome his addiction. Which is more effective?

One last question: If the government didn't attempt to help by giving money from the public coffers to both real and perceived needs, would there be less needs or more? I'd like to hear your thoughts. You may can guess mine.

^[1] Romans 3:10-12 (New International Version)
^[2] Matthew 5:42 (New International Version)