Category: Economics

Cuba-food-vendorRemember when you bought that first thing – a car, maybe – with your own first income? Remember the feeling of pride it gave you? You’d scrubbed pots and pans in the diner kitchen all summer. Or maybe you were the “go-to” babysitter for everyone in your church. You earned that money, and  you bought yourself something.

Now imagine living in a world where that could never happen. You are told by the government that they will care for your every need, no need to pay for anything. Everyone will get the same things, and all will be well. We call this place “Cuba,” and that system has not worked. (See also, Soviet Russia, Bay-area communes and Shakers.)

With the U.S. sanctions against the island nations now lifted, Cuba is beginning to see economic life again. The Communist government also recently changed laws about self-employment.

Joan Perez-Garcia has always had a job – the government guaranteed him one – but he’s never made much money. That is changing. (more…)

coins_ladderOne holdover from 2014 into the new year is the cry for an increase in the minimum wage. President Obama pledged (in a December 2014 speech) to bump the minimum wage up to $9/hour nationally. Many believe that this move will help stimulate the still-sluggish economy.

Michael R. Strain, at  the American Enterprise Institute, isn’t wholly against raising the minimum wage, but he’s not wholeheartedly for it, either. He thinks we are asking the wrong question. Do we need to raise the minimum wage, or do we need to increase employment?

The labor market for young and low-skill workers is in terrible shape. More than 14 percent of workers aged 16–24 are unemployed. The situation is even worse if you look only at teenagers, over 1 in 5 of whom are unemployed. The unemployment rate for high-school dropouts over the age of 24 is 10.8 percent — a two-decade high — and only 4 people out of every 10 in that group have jobs. And there are still a staggering 4.1 million unemployed workers who have been looking for a job for six months or longer, many of whom are young or low-skill. (more…)

china-christiansFor the past three decades China has been the world’s fastest-growing major economy, with growth rates averaging 10 percent a year for 30 years. As Brian J. Grim, founder and president of the Religious Freedom & Business Foundation, notes, there are many reasons for the growth, such as market mechanisms, modern technology and Western management practices. But one factor that is often overlooked is the role of Christianity:
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23692407_BG1To end the 2014 on an incredibly dehumanizing note, CBS aired an episode of Undercover Boss that stirred up protests from all walks of life. Undercover Boss is usually a wonderful program that allows CEOs to see what is happening on the ground in their companies and reward hard workers accordingly. However, this particular episode profiled Doug Guller, the CEO of Bikinis Sports Bar & Grill, who fired a bartender after she decided not to dehumanize herself by wearing a T-shirt instead of a bikini top on television and “rewarded” another employee for her loyalty by promising to pay for her breast enlargement surgery. (See videos below.)

The episode was so bad that Cosmopolitan released as scathing review saying, “what’s also crazy is that CBS aired all this as if it were good fun and zany reality TV, not horribly misogynistic workplace discrimination.” Writers like Rebecca Rose observed that Guller “has always been totally tone deaf about the sexism he enthusiastically promotes and frankly seems to enjoy having offending people with his business practices.”
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1964 tvI heard Fr. Robert Sirico say once that most of us now carry more technology in our pockets than it took to put a man on the moon in 1969. If you remember that, you’ll also remember when a radio was a substantial piece of furniture and having a color television made you a very popular kid in the neighborhood.

In the 1964 Sears Christmas catalog (if you don’t know what that is, ask your mother. Or your grandmother.), you could get a really swanky television console for $750. For that price today, you can head to your favorite electronics store and pick up six 24-inch flat screen televisions – one for every room in the house. AEI’s Mark J. Perry has a little fun comparing the Christmas of 1964 to 2014’s holiday, at least in terms in what the average family can get for their money. He adjusts for inflation for those console tvs:

The original prices are listed ($750 for the Sears Silvertone entertainment center and $800 for the more expensive one), and those prices are also shown converted to today’s 2014 dollars using the BLS Inflation Calculator: $5,700 for the basic 21-inch color TV model and $6,100 for the more expensive model.

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AzpilcuetaCoverCLP Academic has now released On Exchange, a new translation of a key section in Martín de Azpilcueta’s Manual de confesores y penitents, his most influential work.

Originally published in 1549, the section was included as one of four appendices to the Manual, offering commentary on Gregory IX’s prohibition of nautical usury. The release is part of the growing series, Sources in Early Modern Economics, Ethics, and Law.

Azpilcueta (1492-1586), also known as Doctor Navarrus, was a leading canonist and moral theologian of the early modern period. Although On Exchange was meant to provide moral guidance for pastors and penitents, it has drawn the attention of economic historians for its indirect analysis of 16th-century economic realities, including explorations on exchange practices, supply and demand, and the nature of money. As noted in the book’s overview, Azpilcueta’s “account of the fluctuation of the value of money marks a significant development in early modern economic thought.” (more…)

exploding xmas puddingWe all know it’s easy to get unhinged this time of year. It can be the overload of “How am I ever going to get everything for everybody on my list between now and Christmas and still sleep?” to “Which side of the family are we going to anger this year, since we can’t be everywhere at once?” to “You need HOW MANY cookies for the school party tomorrow?”

Christmas – the day Christians celebrate the coming of the God-Made-Man, Emmanuel – can turn very quickly from revelry to unraveled.

What to do? If you’re Arthur Brooks, you talk to a guru in India. (more…)

eye“Blessed are those who find wisdom, those who gain understanding, for she is more profitable than silver and yields better returns than gold.” –Proverbs 3:13-14

In Episode 5 of For the Life of the World: Letters to the Exiles, Evan Koons asks about the purpose of knowledge, wondering whether it’s simply a means to greater levels of self-fulfillment, or if there’s something more. “Is knowledge just a tool that we use to leverage to get more stuff?” he asks.

On the contrary, as he goes on to learn, “knowledge is a gift, and like all gifts in God’s oikonomia, it points us outside of ourselves.” As we participate in the Economy of Wisdom — whether through education, research, or innovation — we have a remarkable opportunity to love greater and serve better, further uncovering the mysteries and abundance of God, and sharing the wonder of his glory with the world around us.

Economists continue to affirm the creative power of human collaboration in generating new ideas, innovations, and discoveries that on the whole have improved our quality life and created enormous opportunities. Why, then, do Christians so often forget the breadth and depth, the aim and end of this core feature? For indeed, when paired with the whole-life transformation found in the Gospel and the Holy Spirit, which includes the renewing of our minds, such collaboration takes a whole new shape. Christians have unique call and contribution to this area, so if we hope to spread life and abundance to those in need across all areas of society, materially, socially, spiritually, and otherwise, having a rightly aligned perspective on the basic purpose of knowledge is essential. (more…)

scholarshipOver at The Gospel Coalition, Hunter Baker reviews Abraham Kuyper’s newly translated Scholarship, a compilation of two convocation addresses given to Vrije Universiteit (Free University). He offers a helpful glimpse into Kuyper’s views on Christian scholarship, as well as how today’s colleges and universities might benefit from heeding his counsel.

Recommending the book to both students and university leaders, Baker believes Kuyper’s insights are well worth revisiting, particularly amid today’s “tremendous upheaval in higher education”:

All universities, and certainly Christian ones, face a landscape in which students have been largely replaced by consumers. The change is not the fault of the students so much as it is a consequence of the extraordinary rise in tuition prices during the past quarter century. Instead of seeing education as a good that enriches lives and provides learners with tools and habits useful to making a career, we’ve embarked on a course in which students all but demand to know which career and exactly how much money….

…Kuyper has much to say to both students and institutions in these century-old addresses. He would resist the transformation of the university into something more like a business. In light of his idea of sphere sovereignty, I think he’d say a school is a different kind of endeavor than a profit-making business—and I think he’d be right. Universities (including Christian ones, especially Christian ones) must find a way to reduce the market-driven nature of their activities…At the same time, students must place more emphasis on developing scholarly (in the best sense of the word) habits and less on simply progressing toward a credential.

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entrepreneur-on-truck“Every single person on the face of the planet is created in God’s image. Everybody has the same heavenly Father. Everybody has capacity, talent, and ability. Everybody has responsibility. Everybody has stewardship responsibility. I don’t care what dirt hovel you’re living in, in Brazil or Mexico City or Manila. You have a responsibility to be a steward of the resources under your control because you have a heavenly Father who has put great things inside of you and that’s waiting to be called out and developed and extracted.” –Rudy Carrasco in PovertyCure

God has called each of us to whole-life transformation and redemptive stewardship, no matter who we are and where we are in life. This relies on a basic understanding of human dignity and a fundamental belief in our identity as co-creators with God the Father. Far too often, we distort or confuse this framework in small and subtle ways, often unknowingly and with well intentions.

Out of a concern for these types of subtle distortions, HOPE International, a Christian network of microfinance organizations, recently altered its mission statement, removing “the poor” and replacing it with “families.” Their mission is now “to invest in the dreams of the poor families in the world’s underserved communities as we proclaim and live the gospel.” (more…)