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What a Chinese economist learned from American churches

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“Only through awe can we be saved. Only through faith can the market economy have a soul.” -Zhao Xiao

When French diplomat and historian Alexis de Tocqueville visited America in the 1830s, he marveled at the “associational life” of American communities, noting the particular influence of religion and local churches. “Not until I went into the churches of America and heard her pulpits flame with righteousness did I understand the secret of her genius and power,” he wrote. “…The safeguard of morality is religion, and morality is the best security of law as well as the surest pledge of freedom.”

Nearly two centuries later, Zhao Xiao, a visiting government economist from China has made a series of similar observations, most notably in a 2002 paper titled, “Market Economies With Churches and Market Economies Without Churches.”

In his travels, Xiao sought to uncover the secret of American prosperity, asking, “Where does the greatest difference between China and America lie?” After comparing and contrasting a number of areas and features — real estate development, the science and technology sector, financial systems, political and legal systems, etc. — Xiao concludes that the clearest difference is found in America’s churches.

“Truth be told,” he writes, “from the east coast of the US to the west coast, from towns to cities, in any place you look you will find that this country’s most numerous structure is none other than the church. Churches, and only churches, are Americans’ center; they are the very core that binds Americans together.”

Xiao’s observations come at a time when American Christianity and church attendance is at an all-time low. Nevertheless, America’s heritage of religious belief may still serve as a cultural foundation. “These days Chinese people do not believe in anything,” he explains. “They don’t believe in god, they don’t believe in the devil, they don’t believe in providence, they don’t believe in the last judgment, to say nothing about heaven. A person who believes in nothing ultimately can only believe in himself. And self-belief implies that anything is possible — what do lies, cheating, harm, and swindling matter?”

Alas, despite the recent strides toward freedom and prosperity in China, Xiao decries its “hobbled market ethics,” leading to culture of dishonesty and a complicated web of corruption and collusion between government and business. “The market economy can only discourage idleness,” he explains. “It cannot discourage people from lying or causing harm.” Indeed, he continues, without a proper economic understanding or moral imagination, “it may entice people to be industrious in their lies, industrious in bringing harm to others, and to pursue wealth by any means.”

In addition to Christianity’s moral framework, Xiao has also noted that China would benefit from its “spirit of contracts” and “spirit of universal love.”

The first thing it will bring is a spirit of contracts. We know that, whether it is a market economy or a constitutional system, behind them all is a civilization based upon rules. So what we need is a group of people who observe rules. Only then can this system work with highest efficiency. And this spirit of contracts, it comes from belief in Christianity, because we know that in the Bible, for instance, there are the Ten Commandments. These are contracts God signed with humans.

The second thing it will bring is the spirit of universal love. There is no culture that can match Christianity’s degree of prizing love, because what it emphasizes is a form of unconditional love, a love for everyone, including those who are not lovable, including those who have hurt you or oppressed you. You have to love them, regardless of whether they are good or bad to you, regardless of whoever they are, you must love them.  So this kind of love is a sign of the openness of modern society and modern civilization.

In the end, Xiao is optimistic that his countrymen already see the value of “market ethics.” For China, it’s more about the hands-on work of “cultural reconstruction.”

Modern economics—modern politics—modern culture form the trinity of the market economy. Seeking the fruits of the market economy, Chinese society ultimately will travel the road of cultural reconstruction, investing in market ethics. It is fortunate that in Chinese society there is already recognition that integrity is the cornerstone of the market economy, but establishing a good cornerstone is no simple matter…

Reality unquestionably requires us to move forward another few steps. The first is cultural transformation. We must find a cultural framework compatible with the modern free market economy. To achieve this, we may unearth from our own long-standing traditional culture a set of ethics that are compatible with modern economics, or we may use absorption and introductions from elsewhere to recreate our cultural DNA.

Given China’s decreasing faith in an atheistic, communistic philosophy of life and the hundreds of millions of Chinese that have recently converted to Christianity in the years since Xiao’s travels (including Xiao himself), the path to establishing that “cultural cornerstone” seems well within sight.

Image: “Pray” by Allen LI (CC BY 2.0)

Joseph Sunde is an associate editor and writer for the Acton Institute. His work has appeared in venues such as The Federalist, First Things, The City, The Christian Post, The Stream, Charisma News, Juicy Ecumenism, Ethika Politika, Made to Flourish, and the Center for Faith and Work. Joseph resides in Minneapolis, Minnesota with his wife and four children.

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