Archived Posts October 2010 » Page 4 of 5 | Acton PowerBlog

Blog author: jcouretas
posted by on Wednesday, October 13, 2010

A good give-and-take on the tea party movement on Our Sunday Visitor. Rev. Robert A. Sirico, president and co-founder of the Acton Institute, weighs in:

Many of the stances tea party activists have taken on political issues also would resonate with Catholic voters, Father Sirico said. For example, many practicing Catholics would likely agree with the tea party’s concern about the overreaching involvement of government in schools and health care, he said, and though the movement has hesitated to identify itself as pro-life, the majority of tea party activists appear to be in agreement with the Church’s stance on abortion.

But while he doesn’t feel that there is a conflict for Catholics to join the tea party, Father Sirico said, he does think tea party advocates could benefit from a greater understanding of Catholic teaching.

“The thing Catholics could teach the tea party is that not every social obligation needs to be viewed with suspicion,” he said. “We recognize that human nature is social as well as individual, and we balance these things out. To say I have an obligation to the poor is [to say] society has an obligation to the poor.”

Read “Is the tea party movement in sync with Catholic teaching?” on the website of Our Sunday Visitor.

Take at look at Jonathan Last’s very good piece in the Weekly Standard about the real population problem that is confronting the world–people aren’t having enough babies. In America’s One Child Policy, Last explains how fertility throughout the entire world is declining and what the impact will be on society and the economy.

During the last 50 years, fertility rates have fallen all over the world. From Africa to Asia, South America to Eastern Europe, from Third World jungles to the wealthy desert petro-kingdoms, every country in every region is experiencing declines in fertility. In 1979, the world’s fertility rate was 6.0; today it’s 2.6. Industrialized nations have been the hardest hit. America’s 2.06 is one of the highest fertility rates in the First World. Only Israel (2.75) and New Zealand (2.10) are more fertile.

Mr. Last addresses a host of reasons for declining fertility, including some of the politically delicate reasons like education, abortion, and egalitarian social policies that many don’t want to address.

He explains how the one-child policy in China and other small-family campaigns in places like Singapore and Japan have not created the promised “bright future” but serious demographic challenges. And new government policies to reverse the trends are not working.

The Japanese government has been trying to stoke fertility since the early 1970s. In 1972, when Japan’s fertility rate was still above replacement, the government introduced a monthly per-child subsidy for parents….In the face of 35 years of failed incentives, Japan’s fertility rate stands at 1.2. This is below what is considered “lowest low,” a mathematical tipping point at which a country’s population will decline by as much as 50 percent within 45 years. This is a death spiral from which, demographers believe, it is impossible to escape. Then again, that’s just theory: History has never seen fertility rates so low.

As Last and others have reminded us, no country with declining population has ever created widespread prosperity. Perhaps we would do well to remember that the factors of production include not just land and capital, but labor–and labor means people. Decline in fertility will have serious social and economic consequences. Last writes:

At the same time, the average age in China will rise dramatically. In 2005, China’s median age was 32. By 2050, it will be 45, and a quarter of the Chinese population will be over the age of 65. The government’s pension system is almost nonexistent, and One-Child has eliminated the traditional support system of the extended family—most people no longer have brothers, sisters, aunts, uncles, cousins, nieces, or nephews. It is unclear what sort of havoc this atomization will wreak on their society. China will have 330 million senior citizens with no one to care for them and no way to pay for their upkeep. It is, Eberstadt observed, “a slow-motion humanitarian tragedy already underway.”

By 2050, the age structure in China will be such that there are only 1.6 workers—today the country has 5.4—to support each retiree. The government will be forced to either: (1) substantially cut spending (in areas such as defense and public works) in order to shift resources to care for the elderly or (2) impose radically higher tax burdens on younger workers. The first option risks China’s international and military ambitions; the second risks revolution.

Though people still promote Malthusian nightmares of over-crowded planets the real demographic disaster not over-population, but the opposite–not enough babies. This decline in fertility is a prime example of why incentives matter–summed up well in Henry Hazlitt’s definition of economics:

“The art of economics consists in looking not merely at the immediate but at the long effects of any act or policy; it consists in tracing the consequences of the policy not merely for one group but for all groups.”

Acton’s Rome office will be hosting a conference on health care and aging on December 2 at the Lateran Pontifical University in Rome. Get more information here

Liu Xiaobo

In the International Herald Tribune, Fang Lizhi points to the experience of Nobel Peace Prize winner Liu Xiaobo over the last 20 years as “evidence on its own to demolish any idea that democracy will automatically emerge as a result of growing prosperity” in China.

According to human rights organizations, there are about 1,400 people political, religious and “conscience” prisoners in prison or labor camps across China. Their “crimes” have included membership in underground political or religious groups, independent trade unions and nongovernmental organizations, or they have been arrested for participating in strikes or demonstrations and have publicly expressed dissenting political opinions.

This undeniable reality ought to be a wake up call to anyone who still believes the autocratic rulers of China will alter their disregard of human rights just because the country is richer. Regardless of how widely China’s leaders have opened its markets to the outside world, they have not retreated even half a step from their repressive political creed.

On the contrary, China’s dictators have become even more contemptuous of the value of universal human rights. In the decade after Tiananmen, the Communist government released 100 political prisoners in order to improve its image. Since 2000, as the Chinese economy grew stronger and stronger and the pressure from the international community diminished, the government has returned to hard-line repression.

Fang Lizhi, in the article “Liu Xiaobo and Illusions About China,” says Liu Xiaobo’s role in the publication of Charter 08 led to more trouble. Little wonder why. Here’s a line from the text:

… we stand today as the only country among the major nations that remains mired in authoritarian politics. Our political system continues to produce human rights disasters and social crises, thereby not only constricting China’s own development but also limiting the progress of all of human civilization. This must change, truly it must. The democratization of Chinese politics can be put off no longer.

The social strain is beginning to tell. In “How China is Weaker than it Looks,” Kerry Brown on The Diplomat writes:

… success means that Communist Party leaders once certain that they’d have two or three decades more of economic reforms to go before getting down to political changes have found themselves confronted with the need to do something far more quickly than expected.

China is on target to become a middle income country by as early as 2020. But while this transition may be welcome, it’s also a stage in any country’s development when various elites—whether business or political—will likely start to experience far sharper disagreements with each other. Lawyers and civil society groups, as the colour revolutions in the former Soviet bloc states show, start to gain much greater social traction, while entities that look and act like an authentic political opposition start to appear.

Acton has recently expanded the Chinese language area of its website. The section includes Acton’s Core Principles and biographical information on Lord Acton.

Lord Acton wrote, “Political atheism: End justifies the means. This is still the most widespread of all the opinions inimical to liberty.” Liu Xiaobo would understand.

Political commentators have spilled a septic field of ink explaining what drives the Tea Party movement; and, sure, the movement is complex and varied, resisting any single attempt to blah blah blah. But the core of it boils down to the Saturday Night Live skit below. The analogy runs like this: The Steve Martin character and his wife represent the ruling political class in Washington; and the Tea Party is the book author.

I realize it’s not a perfect analogy. If it were a perfect analogy, the book author wouldn’t be nearly as detached, because the couple has been spending the author’s money using a credit card he had idiotically loaned them a few years before. Oh, and the husband would be accusing the book author of racism, or of being a flyover country yahoo without the sophistication to understand Keynesian economics or something.

[Hat Tip to Luke at Cornerstone University for the SNL skit.]

Blog author: mmiller
posted by on Tuesday, October 12, 2010

Here is a link to a good summary of McKinsey’s report on business and Africa that can be found at Acton’s good friend Andreas Widmer’s blog Faith and Prosperity.

Andreas is a former Swiss Guard turned high-tech entrepreneur who is now focusing on promoting enterprise solutions to poverty throughout the developing world. He and his colleagues Michael Fairbanks et al. run the Pioneers of Prosperity Awards in different regions throughout the world. I have had the opportunity of attending two of them–one in Rwanda for Africa and one in Jamaica for the Carribean.

Take a look at his blog on a whole range of issues facing entrepreneurs who are serious about their faith.

Blog author: mmiller
posted by on Tuesday, October 12, 2010

Last week several colleagues and I had the opportunity to attend Partners Worldwide conference: Marketplace Revolution: Fighting Global Poverty through Business. Acton was delighted to be one of the sponsors of the event

The conference had 400 people from all over the world and promoted enterprise solutions to poverty. Speakers included Africa Unchained author George Ayittey, Neal Johnson, author of Business as a Mission, among others.

See the list of the speakers here.

We had a chance to talk to many of the participants and hear their stories. The conference made it clear that the answer to poverty in Africa, Latin America, and Asia is not transfers of wealth from one country to another, but creating the conditions that help unleash the entrepreneurial spirit.

For more about what Partners Worldwide go here.

Blog author: jballor
posted by on Tuesday, October 12, 2010

Last week I linked to Joe Carter’s On the Square piece, “What the Market Economy Needs to be Moral,” challenging his view that we need a “third way.” He has since clarified his position, and noted that what he wants is not really an alternative to the market economy but an alternative grounding, view of, and justification for the market economy. This is a position with which I wholeheartedly concur.

Today I want to highlight something else from Carter’s helpful piece. Carter first cites an anecdote from Andy Morriss:

One minister recounted how another minister had told him how God had answered his prayers and healed a headache the second minister had before a major sermon. The first minister commented on how arrogant the second minister was, to demand a miracle to cure his headache when God had already provided aspirin. Surely it is arrogant for us to pray for miracles to relieve drought and poverty when God has already handed us the means to do so—markets. Again, however, we rarely hear moral criticism of those who refuse the miracle of the market and insist that God (or someone) perform the far greater miracle of making economic planning work.

Carter then goes on to note:

This raises an interesting question for Christians: Does God’s sovereignty not extend to markets? If so, why do we expect God to circumvent the institution he has created and provided for our well-being by providing a “miracle”? The primary reason, in my opinion, is that we no longer think theologically about economics.

These two quotes bring out one of the most intriguing points in Carter’s piece. The point is that we are to appreciate the market for what it is, a God-given institution in which human beings created in his image relate to one another for the betterment not only of themselves but also of each other.

Think about the implications of Morriss’ anecdote for a moment.

God works through human means…this is his regular or normal way of acting in the world, through secondary causes including human action. We need not always pray for miraculous healing, but rather that God empower skilled doctors and nurses to heal us. We need not always pray that manna fall from heaven, but rather that God enable farmers to farm.

In his important book, Work: The Meaning of Your Life–A Christian Perspective, Lester DeKoster makes programmatic use of this reality in an interpretation of the parable of the sheep and the goats. As DeKoster writes,

The Lord does not specify when or where the good deeds he blesses are done, but it now seems to me that Jesus is obviously speaking of more than a vocational behavior or pastime kindnesses. Why? Because he hinges our entire eternal destiny upon giving ourselves to the service of others—and that can hardly be a pastime event. In fact, giving our selves to the service of others, as obviously required by the Lord, is precisely what the central block of life that we give to working turns out to be!

So, in the case of the sheep who gave Christ something to eat when he was hungry, we find that

God himself, hungering in the hungry, is served by all those who work in …

  • agriculture,
  • wholesale or retail foods,
  • kitchens or restaurants,
  • food transportation or the mass production of food items,
  • manufacturing of implements used in agriculture or in any of the countless food-related industries,
  • innumerable support services and enterprises that together make food production and distribution possible.

DeKoster goes on to outline similar lists for those who regularly provide water to satisfy the thirst of others and those who provide clothing for those in need. These three are representative, he says.

The Lord’s choice of the kinds of services that are instanced in the parable is carefully calculated to comprehend a vast number of the jobs of humankind. The parable is about the work needed to provide the sinews of civilization. Doing such work, the Lord says, is serving his purposes in history, and in exchange he rewards workers far beyond their input with all the abundance of culture’s storehouse.

As I’ve noted previously, this view of work is transformative for how we approach views of wealth and poverty. We begin to finally be able to see work not just as a way to get a paycheck, but as the way God has ordained for us to truly serve others and thereby to serve Him as well.

Blog author: jcouretas
posted by on Thursday, October 7, 2010

In the “Wealth Inequality Mirage” on RealClearMarkets, Diana Furchtgott-Roth looks at the campaign waged by “levelers” who exaggerate and distort statistics about income inequality to advance their political ends. The gap, she says, is the “main battle” in the Nov. 2 election. “Republicans want to keep current tax rates to encourage businesses to expand and hire workers,” she writes. “Democrats want to raise taxes for the top two brackets, and point to rising income inequality as justification.”

This is a constant refrain from the religious left, which views the income or wealth gap as evidence of injustice and grounds for reforming political and economic structures. In the video posted here, you’ll see Margaret Thatcher, in her last speech in the House of Commons on November 22, 1990, brilliantly defending her policies against the same charge.

Furchtgott-Roth zeroes in on a recent interview with Robert Reich, Secretary of Labor for President Bill Clinton and now a professor at the University of California, Berkeley.

[Reich said:] “Unless we understand the relationship between the extraordinary concentration of income and wealth we have in this country and the failure of the economy to rebound, we are going to be destined for many, many years of high unemployment, anemic job recoveries and then periods of booms and busts that may even dwarf what we just had.”

Mr. Reich is wrong. He and other levelers exaggerate economic inequality, eagerly, because they rely on pretax income, which omits the 97% of federal income taxes paid by the top half of income earners and the many “transfer payments,” such as food stamps, housing assistance, Medicaid and Medicare. This exaggerated portrait of inequality undergirds the present effort by the Democrats to raise income tax rates for people with taxable incomes of $209,000 a year on joint returns and $171,000 a year on single returns.

A more meaningful measure of inequality comes from an examination of spending. On Wednesday the Labor Department presented 2009 data on consumer spending, based on income quintiles, or fifths. This analysis shows that economic inequality has not increased, contrary to what the levelers contend.

Much of the discussion around this issue from the left uses the data to portray America as a heartless land of haves and have-nots. Here’s a quote from a Sept. 28 AP story on new census data, including income figures:

“Income inequality is rising, and if we took into account tax data, it would be even more,” said Timothy Smeeding, a University of Wisconsin-Madison professor who specializes in poverty. “More than other countries, we have a very unequal income distribution where compensation goes to the top in a winner-takes-all economy.”

Here’s an amazing statistic: The average 2009-10 faculty salary at Wisconsin Madison was $111,100. But the median household income for all Americans in 2007 (a roughly parallel comparison) was just over $50,000. Isn’t something out of whack here? Isn’t this evidence of severe economic injustice demanding structural reform? Sounds to me like the Bucky Badger faculty has been helping itself to second and third helpings at the “winner-take-all” buffet.

The faculty at Prof. Reich’s school do even better on average income: $145,800. I suspect some celebrity professors might even be … above average.

This is from “Capitalism: The Continuing Revolution,” an article by Peter Berger in the August/September 1991 issue of First Things. Emphasis mine.

… recent events have added nothing that we did not know before or, more accurately, should have known as social scientists or otherwise as people attentive to empirical evidence. The crucial fact here, of course, is the vast superiority of capitalism in improving the material standards of living of large numbers of people, and ipso facto the capacity of a society to deal with those human problems amenable to public policy, notably those of poverty. But, if this fact had been clear for a long time, recent events have brought it quite dramatically to the forefront of public attention in much of the world, and by no means only in Europe. It is now more clear than ever that the inclusion of a national economy in the international capitalist system (pace all varieties of “dependency theory”) favors rather than hinders development, that capitalism remains the best bet if one wishes to improve the lot of the poor, and that policies fostering economic growth are more likely to equalize income differentials than are policies that deliberately foster redistribution.

[ ... ]

to opt for capitalism is not to opt for inequality at the price of growth; rather, it is to opt for an accelerating transformation of society. This undoubtedly produces tensions and exacts costs, but one must ask whether these are likely to be greater than the tensions and costs engendered by socialist stagnation. Moreover, the clearer view of the European socialist societies that has now become public radically debunks the notion that, whatever else may have ailed these societies, they were more egalitarian than those in the West: they were nothing of the sort. One must also remember that, comparatively speaking, these European societies were the most advanced in the socialist camp. The claims to greater equality are even hollower in the much poorer socialist societies in the Third World (China emphatically included).

An interesting call for papers from H-Net, “Almshouses in Europe from the late Middle Ages to the Present – Comparisons and Peculiarities”:

Within the field of poor relief and welfare, research interests have recently shifted towards the history of private charity and charitable foundations. Among these institutions, which contributed to the early modern and modern mixed economy of welfare, the almshouse played an important role as a particular form of social housing. Almshouses originated in the Middle Ages and many of them still exist. They offered elderly people at risk of impoverishment cheap or free accommodation, often alongside clothing, food, fuel and money – the actual alms. Many were founded by private benefactors. Almshouses usually consisted of a limited number of small apartments for one or two persons. Unlike other welfare institutions in early modern Europe (hospitals, orphanages etc.) almshouse apartments allowed their occupants to run an autonomous household under respectable living conditions and considerable privacy.

Apart from these defining common features, almshouses could differ considerably, although much of their history is still in the dark. The studies available suggest that almshouses were confined to Northwest Europe, namely the Netherlands and Belgium, England and northern Germany, but geographically by no means evenly distributed.

Foundations of almshouses are clustered in the late 15th and in the 17th centuries, at least in the Low Countries and Northern Germany, but not in England where a different pattern emerges, and where almshouses appear to have been founded in a rural rather than an urban setting. Were almshouses inexistent in the rest of Europe? How can the geographical distribution and the waves of foundations be explained?

To ensure a coherent comparative perspective, papers for this conference should deal with almshouses according to the definition mentioned above and address the following issues:

1. Almshouses appear to have been founded predominantly by private benefactors. Who were they and what made them devote a considerable capital to this type of charity? Why did they prefer founding an almshouse to other forms of charity?

2. Who lived in an almshouse? What do we know about the occupants’ social status, family situation, occupation and religion? Could all persons apply or was a recommendation needed? Did the occupants’ legal civic status alter upon moving in, as it did in hospitals? What was the share of almshouses in the overall care of the elderly poor? What was living in an almshouse like?

3. Almshouses must be considered part of a local poor relief system. How many people could be accommodated in relation to those relying on outdoor poor relief or on other institutions like hospitals? What other options did elderly people have when their household income dropped because of infirmity and physical decline? Were almshouses connected with town or parish councils? Can almshouses be regarded as safety valves for the (lower) middle class?

The Conference will be held on 7-9 September 2011 in Haarlem, in co-operation with the Stichting Landelijk Hofjesberaad. We hope to be able to provide the conference attendants with accommodation and meals.

Attendants are kindly requested to have their travel costs reimbursed by the institution they work for, if possible. Deadline of Submission of Abstracts: 1 November 2010 (300-500 words) Deadline of Submission of Papers: 1 July 2011 Organizers:Frank Hatje (Hamburg University), Marco H.D. van Leeuwen (Utrecht University) and Henk Looijesteijn (International institute of Social History)

Contact: hlo@iisg.nl (Henk Looijesteijn)

Blog author: jballor
posted by on Thursday, October 7, 2010

Joe Carter discusses “What the Market Economy Needs to Be Moral” today over at First Things: On the Square.

He rightly points to the twin errors of collectivism and atomistic individualism, each of which have been soundly criticized in Catholic Social Teaching, for instance.

I do wonder, though, given that Joe acknowledges the role of free individuals (not to be abstracted from their social relationships and responsibilities, of course) whether we need a “third way” as he proposes, or simply a framework for evaluating a variety of acceptable ways of engaging the market (or maybe that’s precisely what he means by a “third way”).

That is, if there’s no single Christian view of the government, why would there be a single Christian view of the market? The question becomes here more one of prudence than of mandate, and the “Christian view” of the market simply outlines the broad strokes of acceptable approaches.

Indeed, if as Joe concludes Christians are to “to spend less time treating the markets as abstractions and more time working within them as models of Christ-like behavior,” then there are a variety of approaches to modeling such behavior in the context of market exchange. And why the radical juxtaposition between theory and practice when the rest of the piece is really calling for a new theoretical framework?

There are a number of other interesting elements, perhaps even tensions, in Joe’s thought-provoking piece. I hope to follow up on those in the next day or so.