Category: News and Events

Blog author: rnothstine
Tuesday, November 1, 2011

John J. Miller has an interesting article about Ronald Reagan and his relationship with Eureka College. Those that have studied the 40th president have long known that Eureka, a Disciples of Christ school, has not always embraced its most notable graduate. This from Craig Shirley’s masterpiece Rendezvous with Destiny, a chronicle of Reagan’s 1980 presidential campaign:

Even Reagan’s alma mater, Eureka College in downstate Illinois, seemed ambivalent about him. Reagan was clearly Eureka’s most famous alumnus, and if he became president it would rain attention and much-needed endowments onto the sleepy, perpetually cash-strapped school. Still, there were no outward signs of support for Reagan at Eureka. The tiny school did not even bother to display the rare items and documents he had donated over the years. The material instead was stored in the basement of one of the institution’s six red brick buildings.

Reagan, who adored Eureka for his entire life, certainly received considerable spiritual formation there. Eureka, more recently, has embraced the former president, and he is an essential aspect of fundraising at the school. Here is an interesting tidbit from Miller’s piece concerning the spiritual:

Among the displays in Eureka’s Reagan Museum is a copy of the college’s 1932 yearbook, propped open to page 43. Pictures of six students are on the page, including Willie Sue Smith. Reagan’s photo is at the top. There’s a quote beside it: “The time never lies heavily upon him; it is impossible for him to be alone.” When I asked Morris what this meant, he wasn’t sure. A Google search revealed it to be a line from The Spectator, an 18th-century British periodical. The author is Joseph Addison, a prominent moralist, who wrote it in 1711. In the section of the essay that contains this line, Addison urges his readers to develop a habit of prayerfulness because then they’ll always be in the presence of God. His broader theme is time and how to make the most of it.

For the Reagan Centennial, I published “Deeper Truths Magnify Reagan Centennial” and hosted an Acton on Tap on “Faith and Public Life in Reagan’s America.” I will also briefly address Reagan and his relationship with evangelicals and his outreach to Catholics on the upcoming Acton on Tap on “Religion and Presidential Campaigns” on November 10.

Blog author: jballor
Tuesday, November 1, 2011

A couple weeks ago I engaged CPJ senior fellow Gideon Strauss in a debate at the Christian Legal Society, “Justice, Poverty, Politics & the State: Is There a Christian Perspective?”

One of the questioners afterward proposed that the large scale of the poverty problem required an institution equally as large, i.e. the government. There are lots of problems with that kind of analysis, not least of which is that the “poor” are not some homogeneous blob of humanity, but individual persons created in the image of God facing unique situations with their own unique gifts and talents. So the scale of the problem, perhaps counter-intuitively, calls not for some behemoth- or leviathan-size institution, but a variety of smaller individuals and institutions that can work with people individually and in communal settings. Think here of a variation on Burke’s concept of “little platoons” in the war on poverty.

Because of the nature of big society/government solutions, what we often end up with, unfortunately, when we seek a large institutional answer to the problem of poverty are safety nets that function not so much as trampolines as foam pits.

Perhaps not so funny when you think about it.

In an editorial in a previous issue of the Journal of Markets & Morality, “Printed Source and Digital Resource in Economics and Theology” (PDF), I examined developments in research methodology, particularly with an eye toward digital research tools. One of the tools I highlighted was a project that I had some involvement with, the Post-Reformation Digital Library (PRDL). The PRDL has launched a new version today at it’s own website, and includes a substantive move from bibliography to database, as well as expansive coverage of over 1,900 authors.

I participated in a roundtable discussion yesterday at the Sixteenth Century Society and Conference, where we talked about some of the trends and challenges involved with digital tools. The PRDL was very useful to me recently as I was working on editing a new publication of a translation of a text by Juan de Mariana (1536-1624), A Treatise on the Alteration of Money. The original translation was undertaken some years ago by Fr. Brannan, and I did not have a copy of the treatise by Mariana easily at hand to do some comparison. So naturally I went over to PRDL to see if the original was listed among the site’s contents.

Mariana’s treatise, De Monetae mutatione, was one of seven treatises (treatise #4, actually) published together in 1609 in Cologne. Via the PRDL I quickly found a version available from Google Books and downloaded it. As I opened the document, however, I found that the pages of the fourth treatise seemed to be missing from the PDF. When I looked at the title page, I found that the contents listing for De Monetae mutatione was crossed out, and there was in fact a signature affixed to the document noting that the treatise had been expurgated.

As Stephen Grabill observes in his annotations to the new translation, Murray Rothbard recounts the “fascinating saga surrounding Mariana’s De monetae mutatione” in his Economic Thought Before Adam Smith. As Grabill writes,

Mariana’s tract, which attacks King Philip II’s debasement of the currency, led the monarch to haul the aged (seventy-three-year-old) scholar-priest into prison, charging him with the high crime of treason against the king. He was convicted of the crime, but the pope refused to punish him. He was released from prison after four months on the condition that he would remove the offensive passages in the work, and would promise to be more careful in the future.

King Philip, however, was not satisfied with the pope’s punishment. So the king ordered his officials to buy up every copy they could find and to destroy them. After Mariana’s death, the Spanish Inquisition expurgated the remaining copies, deleting many sentences and smearing entire pages with ink. All non-expurgated copies were put on the Spanish Index, and these in turn were expurgated during the course of the seventeenth century. As a result of Philip’s censorship, the existence of the Latin text remained unknown for 250 years, and was rediscovered only because the Spanish edition, which Mariana himself had translated into Spanish, was incorporated into a nineteenth-century collection of classical Spanish essays.

Unfortunately for me, the censorship would have lasting effects, as the copy first available to me from Google Books was one of those that had been expurgated. I was relieved when PRDL alerted me to another copy digitized by Google. I went to the site and found the listing on the table of contents intact. So again I downloaded the file, assured that my efforts had met with success. But as I examined the file, I found the same set of pages to be missing again. As I looked back at the front matter, I found that a similar note was appended on the verso side of the contents page, noting that the treatise De Monetae mutatione had been expurgated in 1632. The text was expurgated and I was exasperated.

But fortunately I did know that Google Books has some quirks, and so I went to the book’s “About” page and located yet another digitized copy under “other editions.” While the other two originals were from Spanish libraries, this third file was held by the Austrian National Library. Lo and behold, this third time was the charm, as the Austrian library’s copy had not been mutilated.

This is just one instance of the promise that digital research tools and methods allows us, in many cases recovering long-lost texts, or undoing the machinations of long-defunct political regimes. The fruits of this labor can be found in the current and future generations of scholarship, which have the task to make full and responsible use of these possibilities. To do your part to make sure that Philip II doesn’t get the last say in mutilating both money and Mariana’s text, purchase a copy of A Treatise on the Alteration of Money, the first installment of our new Sources in Early Modern Economics, Ethics, and Law series, today.

If you were lucky enough to be at our Houston luncheon last Thurday, you enjoyed Rev. Robert A. Siciro’s very well-received talk on The Moral Adventure of a Free Society, and the company of more than 200 other friends of the Acton Institute. We are grateful to the Honorable George W. Strake, Jr., who served as emcee, and Dr. Robert B. Sloan, Jr., president of Houston Baptist University, who gave the invocation.

The table of young men from Western Academy


A great big thank you to the host committee is in order:

Jeremy S. Davis
Maureen and James Hackett
Shanna and Andrew Linbeck
Bette and Leo Linbeck
Paige and Craig Moore
Wiley L. Mossy, Jr.
Annette and George Strake
Barbara and Robert Zorich

The luncheon’s sponsors were:

Bridges to Life
Alice and Philip Burguieres
The Center for Peace
Anthony and Coleen Madden Ethridge
Donna and Richard Hanus
Mossy Nissan
Marianne and Joe Quoyeser
Spence Media
Western Academy

We look forward to coming back to Texas soon!

Dr. Robert Sloan, president of Houston Baptist University, gives the invocation

Lunch is served


Wang Yue

On The American Spectator, Acton Research Director Samuel Gregg looks at the death of Wang Yue, a Chinese toddler run over — twice — in a public market while passersby continued on their way.


Accidents happen. But what made little Wang Yue’s death a matter for intense public discussion was the fact that nearly 20 people simply walked by and ignored her plight as she lay bleeding in the gutter.

What, hundreds of Chinese websites, newspapers and even state media outlets are asking, does this say about Chinese society? Have Chinese people lost all sense of concern for others in the midst of the scramble for wealth unleashed by China’s long march away from economic collectivism? One local official summarized the collective angst by stating: “We should look into the ugliness in ourselves with a dagger of conscience and bite the soul-searching bullet.”

Gregg points to widespread business-government corruption as a major contributor to China’s moral crisis:

The problem, from the perspective of China’s party-government-military elites, is such soul-searching may lead increasing numbers of Chinese to conclude that the circumstances surrounding Wang Yue’s death are symptomatic of deeper public morality problems confronting China, some of which could significantly impede its economic development.

One such challenge is widespread corruption. By definition, corruption doesn’t easily lend itself to close study. Its perpetrators are rarely interested in anyone studying their activities. Few question, however, that there’s a high correlation between corruption and widespread and direct government involvement in the economy. The more regulations and “state-business” partnerships you have (and China has millions of the former and thousands of the latter), the greater the opportunities for government cadres to extract their personal pound of flesh as the price of doing business.

Read “China’s Morally Hollow Economy” on the website of The American Spectator.

Acton On The AirIn the wake of the release of the Vatican’s Note on Global Financial Reform, the media has called on Acton for comment and analysis. Presented here are three interviews on the topic from the past few days; we’ll post more as audio becomes available.

On Monday afternoon, Acton’s Director of Research Dr. Samuel Gregg joined host Al Kresta on Kresta in the Afternoon to discuss the problems with the note:

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The following day, Dr. Gregg joined host Drew Mariani on Relevant Radio to discuss the same topic:

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Finally, on Tuesday Acton President Rev. Robert A. Sirico made an appearance on Kresta in the Afternoon that served as a preview to his discussion of the good and bad portions of the Vatican’s note in today’s Wall Street Journal, and sheds light on exactly what a “note” from the Vatican is:

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Update: Sam Gregg audio clips are now working!

When the Pontifical Council for Justice and Peace needed an expert economist to assist in articulating the “Note” titled Towards Reforming the International Financial and Monetary Systems in the Context of Global Public Authority to feisty journalists at an Oct. 24 Vatican press conference, it called on the University of Rome “Tor Vergata” economics professor, Leonardo Becchetti.

For an English translation of the professor’s remarks at the Vatican press conference, go to the end of this post.

Prof. Becchetti is a local celebrity of sorts, whose TV time has increased since the outbreak of the global financial crisis and growing cynicism on the future of the European Union. He has provided his expert assessments and criticism to Italian news channels and late night talk show programs, and has become a “go-to guy” when speaking on the relationship of economics to human happiness, central banking and monetary policy. See his interview of the monetary policy and inflation:


No doubt, Prof. Becchetti was charged with the very difficult task of articulating and defending some the Note’s bold economic and political prescriptions – usually a “no-fly zone” for Vatican officials. Moreover, in all fairness, Becchetti removed his professor’s hat to his best ability, while speaking in relatively plain language to the journalists, most of whom, like myself, do not hold PhDs in international finance and monetary policy.

What follows is the unofficial English translation (actually my own) of the transcript of Prof. Leonardo Becchetti’s presentation. Becchetti’s technical debriefing on the Note last Monday raised a few eyebrows and provoked some critical thinking on what the Vatican document said (and didn’t say) regarding international financial and monetary reform.

For example the following finer points jumped out when translating Becchetti’s remarks:

1. The logic that a global economy requires global governance seems not quite right. What about the Church’s traditional support of subsidiarity, that is, crises should be resolved at the local level of problem. The financial crisis is a pandemic and will require massive effort to resolve it, but local symptoms and outbreaks of this financial disease are manifest in unique ways from nation to nation. A single global monetary and financial authority might simply enforce a “one-size-fits-all” policy that is not practical in most countries. This logic smacks of the 20th century centralized economic planning that has proven destructive in Eastern Europe.

2. Becchetti’s analogy of the “long spoons” is not sensitive to the fact that, through human innovation, those same klutzy over-sized spoons can be creatively re-invented through human innovation to allow for self-feeding. For me, Becchetti’s long spoon analogy inspires ideas of spoon-feeding each other (i.e. receiving easy hand-outs) and not creative cooperation to resolve our financial crisis. If left to fend for ourselves, it might be a clumsy experience at first, but we will then be forced to find ingenious and independent ways of self-preservation.

3. It is true that our world is increasingly interdependent and this provides great opportunity for international solidarity and cooperation, but why use the term “formidable threat” when addressing the fact that first world job holders are feeling the heat of equally qualified laborers from developing countries? I like the thought that the first world feels the need to compete and intelligently find more efficient ways of production, but Becchetti’s subtle semantics seem to infer that Marxist class struggles are at play in devising a global financial peace plan .

4. Lastly, what evidence is there that a financial transaction tax on stock exchange activity will ease the pain and suffering of today’s struggling businesses and unemployed? How many ways have we tried to tax and redistribute our way to human fulfillment? Is this the missing link in international economic planning? Cannot someone speaking on behalf of the Church and who is an expert in economics and happiness, at least make some sort of plea for greater spiritual wealth and its redistribution (i.e. by becoming fulfilled in Christ evangelizing His Word)?

I am sure you will have more questions yourself. Please feel free to share your own opinions.

Translation of Prof. Leonardo Becchetti’s remarks (original Italian version)

The bright side of the [financial] crisis is that it represents a time of great opportunity.

The global financial crisis is an opportunity to reform the very architecture of the global financial system, strengthen the European Union in terms of harmonizing its fiscal policies, while progressing more swiftly toward a goal of political unity and increasing discipline over national fiscal policies.

The Vatican document focuses on two key issues:

i) Building a set of rules for global governance which, if possible, will be used as a framework [to guide] the actions of global institutions;

ii) Reforming the international financial system with a series of specific proposals.

Concerning point i), global governance is urgently needed to overcome the asymmetry caused by the globalization of markets, institutions and rules that remain predominantly national.

Globalization makes us increasingly interdependent and makes it practically impossible to ignore other countries whose problems once seemed so distant: Simul stabunt simul cadent [Latin for similar things fall together].

To give you a few examples, there are at least six fundamental elements of interdependence between economic and financial systems:

i) the American debt crisis is a problem that concerns not only [the U.S.] itself but savers around the world who have invested in it and in the largest economies, like China, that [in turn] have invested a substantial portion of their own reserves in [U.S.] treasury bonds;

ii) the Greek debt crisis and the likely reduction in the facevalue of this country’s bonds (between 20% and 60%) will result in serious losses on the balance sheets of the French and German banks that had invested in them;

iii) the presence of a huge mass of poor and underprivileged in the world, willing to work at wages much lower than those of our own employees (bearing equal credentials and who are also protected and unionized) is a formidable threat to the maintaining levels of wealth of high-income countries;

iv) exiting from the euro would have damaging effects not only on developing countries but also on Germany itself, which for years has enjoyed the advantage of exporting its goods to markets within the Eurozone without additional costs linked to exchange rates;

v) the coordination of central banks is now increasingly important in a globally integrated world; recently, developing countries have often complained that the expansionary monetary policies of American and European central banks (quantitative easing) have exported inflation into their countries;

vi) for some time now G-20 meetings have tried coordinate the policies of countries with deficits with those with surpluses to encourage the latter to adopt more expansionary policies to boost demand throughout the world.

The [current situation is like] a large table full of guests, each of which is given a very long spoon to eat with. The difference between hell and heaven in this familiar story is that in some guests use their spoons to clumsily and unsuccessfully feed themselves while others use their long spoons to feed each other. It is in the former situation which nation states find themselves in globally integrated markets as they try to pursue their own short-sighted and short-term interests. This becomes counterproductive, because it is only by cooperating with each other that we will be able to put an end to this financial crisis.

On the second point (the rules of financial markets), the document adopts some proposals already launched by the Dodd-Frank legislation in the United States and by the Vickers Commission in the United Kingdom, but which have not yet been implemented and are not in force due to a number of obstacles.

It is fundamental that the world of finance returns to its role of serving the real economy. To do so it is necessary to:

i) reduce the leverage of banks that are “too big to fail” (the disproportionate 30:1 leverageratio between short-term liabilities and long-term assets is among the main causes spreading the subprime crisis throughout the world).

ii) adopt the so-called Volcker Rule which prevents banks from doing proprietary trading with customer deposits.

iii) more severely regulate the trading of derivatives born from insurance instruments. In the real economy insurance policies are purchased when someone owns an actual asset to be insured, while in financial markets this occurs in no more than 5 percent of cases. For this purpose, there is an EU proposal to achieve this objective regarding the credit default swaps of government bonds.

A fourth proposal concerns the instituting of a tax on financial transactions for reasons explained in the following paragraph.

It is important to ask why the position on taxing financial transactions of economists and civil society (a majority EU citizens in fact are in favor) has changed radically in recent years.

Last year, 130 Italian economists signed an appeal in support [of the proposition], which garnered further support with a similar appeal put forth by 1000 economists from 53 countries and delivered to the Finance Ministers of G20 countries attending the 2011 Summit held in Washington, D.C. last April 14-15 (among the prominent signees were highly respected leaders such as Dani Rodrik, Tony Atkinson, Joseph Stiglitz and Jeffrey Sachs) See:
There are two reasons for this change of opinion: the events of the global financial crisis and further evidence that has helped to alter some [former] prejudices.

Upon the advent of the global financial crisis, the public finances of some major Western countries have been severely weakened while bailing out banks and, consequently becoming new targets themselves of speculative attacks.

A part of the financial world has thus privatized profits, socialized losses, and then utilized public funds used to bailout those who had come to the rescue in the first place.

It is, therefore, understandable why the majority of public opinion believes that those working in the financial markets should, therefore, help pay for the costs of this crisis, the burden of which has been currently shared by the most vulnerable [taxpayers in society].

From this point of view the FTT responds to the simple demands of justice, which seems urgent, given the most recent current events, in order to maintain social cohesion within the Community.

The second reason for increased favor for such a tax stems from the shedding of prejudice.

Until recently the tax was considered inappropriate and not globally applicable should it involve capital from the country in which it was enforced.

This bias is unfounded, as documented in research conducted by the International Monetary Fund, because there are at least 23 countries today that unilaterally apply a transaction tax (which is none other than a stamp tax) without there ever having been any [from their respective countries]. (See. T. Matheson , Taxing Financial Transactions. Issues and Evidence, IMF WorkingPaper No 11/54, March 2011, 8).

The United Kingdom is the country with the highest tax transaction with the application of its Duty Stamp Tax on one single type of financial asset (0.005% duty on the value of shares owned and listed on the London Stock Exchange).

This tax raises about 5 billion pounds in revenues each year.

By way of this evidence [EU Commission President] Barroso’s proposal to establish such a tax in the EU correctly addresses a “harmonization” of taxes throughout Europe on financial transactions –and not of their first introduction.

The London [Stock Exchange] tax has provided an interesting example of tax avoidance, as some operators have exited the stock market to invest in new OTC derivatives (contracts for differences) which essentially consist of bets on variations in share prices.

It is interesting to note, therefore, that the transaction tax has now split the market into two: those really interested in investing in company shares and those who bet on short-term variations in prices.

Such [tax] avoidance is already implicitly considered in the Barroso proposal, which would extend taxation to derivatives (and thus also to contracts for differences). Such problems can also be countered by banning contracts for differences as is already the case in a major financial market, like the United States.

From a scientific perspective, there are numerous ways to measure the elasticity of volumes of transactions upon introducing such transaction taxes, demonstrating a conservative coefficient rather than supporting the capital hypothesis.

Another reason for why the cannot occur is that a very high frequency of financial operations benefit from being in close proximity to the Stock Exchange’s physical location, where the information is released firsthand electronically. (See: New York Times (2009): Stock Traders Find Speed Pays, in Milliseconds). Moving away from the live center of market operations would mean losing such a [critical time] advantage.

One seemingly unfounded objection is the impact the tax will have is on the overall cost of capital.

To set the rate proposed by the Barroso tax proposal, calculations based on the capitalization models of expected future asset values show that this cost is basically null (See again: Matheson 2011).

The other objection is based on reduced liquidity caused by the tax within markets. This is a matter of opinion. How much cash do we really need? Dean Baker, in his commentary on this issue, says that the tax would spell a return to transaction costs and to the state of liquidity of some ten years ago – that is to say, returning to a period that was far more flourishing than the times we are currently experiencing.

The truth is that there is no solid evidence on the effects of this tax on [total] liquidity, but only a series of different models with opposing results depending on the particular type of microstructure of financial markets and competition models hypothesized by intermediaries.

Summing up the four main objections to the institution of such a tax ([1] the tax cannot be imposed except on a global level, [2] there would be no control over the , [3] the tax significantly increases the overall costs of capital, and [4] the tax reduces market liquidity, they are either are false or unsubstantiated based on factual evidence (the first two) or lack of proof (the latter two).

Regarding the above arguments, the transaction tax (certainly not a panacea for all evil) may just represent an important step in recalibrating the relationship between financial institutions and other reforms that can help to prevent a new financial crises, as advocated by the Dodd Frank legislation [in the U.S.] and the Vickers Commission in the United Kingdom (cf. the Volcker Rule, the deleveraging of “too big to fail” intermediaries, and penalizing capital requirements for riskier investments as opposed to ordinary credit) and the restoration of civil society’s confidence in the financial institutions we so urgently now depend on.