Category: Economics

downloadIn his latest column for National Review, Jonah Goldberg notes the difference between being pro-business and pro-market and says the GOP can’t have it both ways anymore:

Just to clarify, the difference between being pro-business and pro-market is categorical. A politician who is a “friend of business” is exactly that, a guy who does favors for his friends. A politician who is pro-market is a referee who will refuse to help protect his friends (or anyone else) from competition unless the competitors have broken the rules. The friend of business supports industry-specific or even business-specific loans, grants, tariffs, or tax breaks. The pro-market referee opposes special treatment for anyone.

Politically, the reason the lines get blurry in good times and bad is that in a boom, the economic pie is growing fast enough that the friend and his competitor alike can prosper. In bad times, when politicians are desperate to get the economy going, no one in Washington wants to seem like an enemy of the “job creators.”

Goldberg is absolutely right about the difference being categorical. As economist Arnold Kling has helpfully outlined, support/opposition to markets and business gives us four categories:
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Selfsmall“Christian discipleship is nothing less than conformity to Christ—as individual believers and as local communities,” writes Charlie Self in Flourishing Churches and Communities, CLP’s Pentecostal primer on faith, work, and economics. “The very life of God is in us.”

Most of us have heard the Great Commandment and the Great Commission in their basic forms, but understanding the relationship between the two and living out that combined imperative can be difficult to wrap our minds around.

How do we love the Lord with all our heart, soul, and mind? How do we love our neighbor as ourselves? How do we love ourselves without descending into selfishness?

Self argues that “all of these ‘loves’ grow together,” and thus, we should be wary of drawing unhealthy divides, focusing on one area or group of areas to the detriment of the other(s). Fruitful stewardship depends on a healthy and holistic focus not just on who we ought to be serving, what we ought to be doing, and how we ought to be doing it, but first and foremost, from where such activities are sourced and directed.  (more…)

Radio Free ActonWhat is the end – the goal – of business anyway? Is it to merely maximize a profit or to do good, or some balance between the two? And what exactly does it mean for a business to “do good”? And if I happen to be a person of deep religious faith, do I have to check my faith at the boardroom door? What influence should my faith have on the exchanges I engage in day to day, and what are the practical implications of ethics on how I conduct myself in business relationships? Andrew Abela is the 2009 recipient of Acton’s Novak Award. He has just co-authored a very important book on the subject of the intersection of ethics and morality with business: A Catechism for Business: Tough Ethical Questions & Insights From Catholic Teaching (The Catholic University of America Press). He speaks with Acton’s Paul Edwards on this edition of Radio Free Acton.

brendan-eich-mozilla-firefox-squareBrendan Eich, Mozilla co-founder and creator of the JavaScript programming language, was recently appointed as Mozilla’s chief executive. Just one week later, however, he was pressured to resign.

His iniquity? Donating $1,000 in support of Proposition 8, a measure whose basic aim was entirely consistent with the beliefs of Barack Obama at the time.

To announce Eich’s departure, Mozilla quickly moved to clarify, offering a statement of faith of sorts, filled with all the right Orwellian flourishes:

Mozilla believes both in equality and freedom of speech. Equality is necessary for meaningful speech. And you need free speech to fight for equality. Figuring out how to stand for both at the same time can be hard.

Our organizational culture reflects diversity and inclusiveness. We welcome contributions from everyone regardless of age, culture, ethnicity, gender, gender-identity, language, race, sexual orientation, geographical location and religious views. Mozilla supports equality for all.

We have employees with a wide diversity of views. Our culture of openness extends to encouraging staff and community to share their beliefs and opinions in public. This is meant to distinguish Mozilla from most organizations and hold us to a higher standard. But this time we failed to listen, to engage, and to be guided by our community.

While painful, the events of the last week show exactly why we need the web. So all of us can engage freely in the tough conversations we need to make the world better.

With its unique blend of diversity-speak and passive-aggressive angst, the dance of Cultural Conformity isn’t easy to master. But oh, how glorious its artistry. (more…)

VATICAN-POPE-AUDIENCEPope Francis needs distributism, argues Arthur W. Hunt III in the latest issue of The American Conservative. Hunt says that Americans and popes alike can embrace a humane alternative to modern capitalism:

In the midst of their scramble to claim the new Pope, many on the left missed what the Pontiff said was a nonsolution. The problems of the poor, he said, could not be solved by a “simple welfare mentality.” Well, by what then? The document is clear: “a better distribution of income.” And how might this be achieved? Through the “right of states, charged with vigilance for the common good,” to exercise some control against an “absolute autonomy of the marketplace and financial speculation.”

The Pope called for a kinder and gentler capitalism. Admittedly, he did not provide many policy details other than, “We can no longer trust the unseen forces and the invisible hand of the market … it requires decisions, programmes, mechanisms and processes specifically geared to a better distribution of income.” It is that phrase, “distribution of income,” that struck fear into Palin and Limbaugh, and perhaps even Reno. It smacks of socialism—what Reno called the only and obvious alternative to capitalism. Reno briskly passed over any notion of a third solution, one many sons and daughters of Rome have rallied to for over a century.

The word distributism does not appear in the treatise, and nowhere does Francis fall back on his predecessors or Catholic intellectuals who have supported a third way of economic ordering. Nevertheless, policies that allow for the flourishing of smaller economic units while at the same time valuing work and broader property ownership are consistent with Catholic social teaching.

Despite not being Catholic myself, I found almost nothing in Hunt’s article all that objectionable. The only point of true disagreement is the claim that distributism is an alternative to either capitalism or socialism. Distributism is not an alternative at all, for distributism doesn’t actually exist.

Over the past hundred years there have been numerous explanations for why distributism is unrealistic and unworkable as a “third-way” alternative. Here are four that should suffice to point out why no one — whether a pope or plumber — needs distributism:
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The following flowchart comes from “Theology That Works,” a 60-page manifesto on discipleship and economic work written by Greg Forster and published by the Oikonomia Network.

Given our tendency to veer too far in either direction (stewardship or economics), and to confine our Christian duties to this or that sphere of life, the diagram is particularly helpful in demonstrating the overall interconnectedness of things.

Oikonomia flowchart, diagram, faith, work, economics

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Blog author: jcarter
posted by on Wednesday, April 2, 2014

money-and-justice-scales“If a society regards governmental manipulation of money as the antidote to economic challenges,” writes Acton research director Samuel Gregg at Public Discourse, “a type of poison will work its way through the body politic, undermining justice and the common good.”

Money: it’s on everyone’s mind sometimes. In recent years, however, many have suggested there are some fundamental problems with the way money presently functions in our economies.

No one is seriously denying money’s unique ability to serve simultaneously as a medium of exchange, a measure and store of value, and a means of calculation. Yet deep reservations about the current workings of the world’s monetary systems, both foreign and domestic, have been expressed by people ranging from Senator Rand Paul (who is fiercely critical of the Federal Reserve), to Pope Francis (who has denounced what he calls “the cult of money”) and France’s François Hollande (who once described “big finance” as his “greatest adversary”).

Read more . . .

Blog author: jcarter
posted by on Thursday, March 27, 2014

bitcoin“For federal tax purposes, virtual currency is treated as property.”

With those ten words, the IRS has made it more difficult — if not impossible — for bitcoin and other virtual currencies from gaining widespread, mainstream acceptance as a currency for commercial transactions. Because they are now treated as property, virtual currencies are considered, like stocks, bonds, and other investment property, as capital assets and will be subject to capital gains tax.

But why does this hinder bitcoins use a currency? The answer is fungibility: Bitcoins are no longer completely fungible.
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Pope Francis

Pope Francis

In today’s New York Post, Acton’s Michael Matheson Miller discusses Pope Francis’ views on poverty, in light of the pope’s upcoming meeting with President Obama. Miller reminds the reader that the pope is not an economist or a politician. Trying to view him through that type of lens is a mistake, says Miller.

Pope Francis is not an economist or technocrat laying out policy; nor does he see the government as the primary solution to all of our problems. He is a pastor exhorting us to take seriously the “joy of the Gospel” and to integrate it into every aspect of our lives, including economics.

I think it is fair to say that some of the pope’s words on economics lacked precision, yet his comments about the corrosive effects of consumerism and the exclusion of the poor are incisive.

Miller acknowledges that the  pope remains skeptical about free markets, which is problematic, given how much free markets have to offer the poor.

In La Cava, an impoverished neighborhood on the outskirts of Buenos Aires, I spoke with a pastor and a local city councilman. They explained that within La Cava there is no private property, and no rule of law. The police don’t even go inside, but only drive around the perimeter. (more…)

Blog author: mvandermaas
posted by on Friday, March 21, 2014
Amity Shlaes

Amity Shlaes – Graphic Novelized!

In November of last year, we had the privilege of welcoming bestselling author Amity Shlaes for a visit here at the Acton Building while she was in Grand Rapids to speak about Calvin Coolidge at Grand Valley State University’s Hauenstein Center for Presidential Studies. Aside from being a fine author of some very thought provoking books on history and economics, she’s a delightful lady, and it was a pleasure to have an opportunity to make her acquaintance personally. At the time, she was very excited about a project that she had been working on which was soon to be released to the public – a graphic novel adaptation of her best-selling book, The Forgotten Man. Her enthusiasm for the project was infectious, and I’ve been looking forward to its release ever since. (You can pre-order a copy of the book, which is set to be released on May 27.)

But how does one take a nearly 500 page hardcover book that revisits the economic history of the Great Depression and translate it into a visual presentation on the printed page? It wasn’t a simple process. Paul Rivoche is the artist who worked with Shlaes on the project; in this interview at Graphic Novel Reporter, he describes how the original book was reworked in order to create a compelling visual story:

The original book was nonfiction and of course not at all structured to be a graphic novel. It’s an economic history of the New Deal/Great Depression era, described from an alternative viewpoint. It has a huge cast of characters — all real people — and discusses many abstract ideas. To make it work as a graphic novel, we had to find a new structure for the same material; we couldn’t follow the exact arrangement in the print book. For example, there are many jumps in location in the real-life story we tell, and all these characters coming and going. In prose, it worked because you imagine it in your head, stitching it together, following the steady guidance of the author’s voice. In comics form, the same thing was disorienting. We learned that if the visuals change too fast, without enough explanation, the reader easily becomes confused when dealing with such complex events, all these different scenes and faces. To solve this, we decided to introduce a “framing story” using a narrator, Wendell Willkie. In telling the story, he guides us — at times directly, and in other scenes we hear his voiceover narration in captions. Also, we had to make the story as visual as possible, not all “talking heads,” which make for dull comics. Instead, we highlighted interesting locales: the Hoover Dam, the great flood of 1927, Willkie’s famous debate, and many others. In every scene we aimed to introduce as much movement, action, and characterization as possible.

The full interview has more detail on the project; After the jump, you can listen to an August 2012 Radio Free Acton interview with Amity Shlaes on her then-forthcoming biography on Calvin Coolidge.

Paul_Rivoche_The_Forgotten_Man

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