If you weren’t able to join us in person for the inaugural lecture of the 2011 Acton Lecture Series, fear not: today, we’re pleased to present Rev. Robert A. Sirico’s “Christian Poverty in the Age of Prosperity” for our loyal PowerBlog readers. The lecture was delivered on February 3rd at the Waters Building here in Grand Rapids, Michigan.
Continuing our recap of last year’s Acton Lecture Series in anticipation of Thursday’s opening lecture of the 2011 ALS (which you can register for right here), we’re pleased to present the video from February and March of 2010.
On February 18, 2010, Acton’s Director of Media Michael Miller Delivered a lecture entitled “Does Capitalism Destroy Culture?” His lecture discussed the positive and negative impact of capitalism in society today. Miller pointed out that it’s not just Christians that are worried about culture and that it is just not a right or left issue. Many are also worried about rampant consumerism and the perceived danger of technology. Miller also addressed the Southern Agrarians and their conservative critique of industrialization. Video is below:
A month later on March 18, we welcomed Rudy Carrasco to our podium to deliver a lecture entitled “Do the Poor Need Capitalism?” A 2009 paper from the National Bureau of Economic Research says that the number of people in the world living on less than $1 per day fell from 403 million in 1970 to 152 million in 2006. An analysis from the American Enterprise Institute says the biggest factor was the rise of the middle class in China and India, at a time when the world’s population grew by 3 billion. Carrasco discussed whether capitalism is a greater asset than liability in the fight against poverty, and whether capitalism must be moderated by virtue and morality before a Christian can embrace it. Again, the video is below:
In “Human Nature and Capitalism” on AEI’s The American, Arthur C. Brooks and Peter Wehner look at three different “pictures” of what it means to be human and point to the one, foundational understanding that has undergirded the flourishing American culture of democratic capitalism:
“If men were angels,” wrote James Madison, the father of the Constitution, in Federalist Paper No. 51, “no government would be necessary.” But Madison and the other founders knew men were not angels and would never become angels. They believed instead that human nature was mixed, a combination of virtue and vice, nobility and corruption. People were swayed by both reason and passion, capable of self-government but not to be trusted with absolute power. The founders’ assumption was that within every human heart, let alone among different individuals, are competing and sometimes contradictory moral impulses and currents.
This last view of human nature is consistent with and reflective of Christian teaching. The Scriptures teach that we are both made in the image of God and fallen creatures; in the words of Saint Paul, we can be “instruments of wickedness” as well as “instruments of righteousness.” Human beings are capable of acts of squalor and acts of nobility; we can pursue vice and we can pursue virtue.
And they draw a parallel to institutions of government where democracy, with all of its flaws, also works itself out to be the most fitting form of government under this model of human nature. When I engage with critics of the market economy, I use the following Churchill quote but substitute “market economy” for “democracy.” Valid, I think, because we have some disastrous experience with political systems that do not operate in concert with a more or less open market.
Many forms of Government have been tried and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of government except all those other forms that have been tried from time to time. — Winston Churchill (House of Commons, Nov. 11, 1947)
Brooks and Wehner:
… our “picture of human nature” determines, in large measure, the institutions we design. For example, the architects of our government carefully studied history and every conceivable political arrangement that had been devised up to their time. In the course of their analysis, they made fundamental judgments about human nature and designed a constitutional form of government with it in mind.
What is true for creating political institutions is also true for economic ones. They, too, proceed from understanding human behavior.
It is hard to overstate the importance of this matter. The model of human nature one embraces will guide and shape everything else, from the economic system one embraces (free-market capitalism versus socialism) to the political system one supports (democracy versus the “dictatorship of the proletariat”). Like a ship about to begin a long voyage, a navigational mistake at the outset can lead a crew to go badly astray, shipwreck, and run aground. To use another metaphor, this time from the world of medicine: A physician cannot treat an illness before diagnosing it correctly; diagnosing incorrectly can make things far worse than they might otherwise be.
Those who champion capitalism embrace a truth we see played out in almost every life on almost any given day: If you link reward to effort, you will get more effort. If you create incentives for a particular kind of behavior, you will see more of that behavior.
A free market can also better our moral condition—not dramatically and not always, but often enough. It places a premium on thrift, savings, and investment. And capitalism, when functioning properly, penalizes certain kinds of behavior—bribery, corruption, and lawlessness among them—because citizens in a free-market society have a huge stake in discouraging such behavior, which is a poison-tipped dagger aimed straight at the heart of prosperity.
Read the full article on The American.
I just sent off a draft of a brief review of Carl Trueman‘s new book Republocrat: Confessions of a Liberal Conservative to appear in the next issue of Religion & Liberty. (You can get a complimentary subscription here).
I recommend the book as a very incisive and insightful challenge to any facile and uncritical identification of the Christian faith with particular political and economic ideologies.
Here’s a snippet of the review:
[Trueman’s] project is not about demonizing capitalism, wealth, or profits one the one hand, or political power on the other. It is about putting the pursuit of profit and power in its proper place. Thus what he writes about the market applies equally well to the government: “no economic system, least of all perhaps capitalism, can long survive without some kind of larger moral underpinning that stands prior to and independent of the kinds of values the market itself generates.” It is in this larger and prior system of belief and action, the Christian faith, that we are to seek our primary identity and unity, and in pursuit of this Trueman’s book is a bracing and worthwhile effort.
I have been saying in various venues for quite some time now that Trueman’s book can be read as a kind of complement to my recent book, Ecumenical Babel: Confusing Economic Ideology and the Church’s Social Witness. But whereas Trueman’s proximate context is the conflation of conservative politics and the Christian faith by evangelicals, my book’s context is the conflation of progressive politics and the Christian faith by mainline ecumenists.
But both books share a basic thesis that, in Trueman’s words, “The gospel cannot and must not be identified with partisan political posturing.”
The Hastert Center at Wheaton College will host a debate tomorrow night between Jim Wallis, president of Sojourners, and Arthur Brooks, president of the American Enterprise Institute, on the question, “Does Capitalism Have a Soul?” Washington Post columnist Michael Gerson will moderate.
In framing the debate, Dr. Seth Norton, Hastert Center director, notes in the press release:
“It’s a good chance to compare different visions of capitalism and market economies, and to discuss the role of government in those economies. There is a lot of debate on these issues in secular venues, but this is a chance to hear two people who have a spiritual common denominator address complicated issues related to economic systems, and that’s a rare event.”
The event begins at 7 p.m. and is open to the public.
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).
Whittaker Chambers began Witness, the classic account of his time in the American Communist underground, with the declaration: “In 1937, I began, like Lazarus, the impossible return.” The line was most of all a deep recognition of the power of God to redeem what was once dead. Witness was a landmark account of the evils of Communism but most importantly a description of the bankruptcy of freedom outside of the sacred. “For Chambers, God was always the prime mover in the war between Communism and freedom. If God exists then Communism cannot,” says Richard Reinsch II. And it is Reinsch who reintroduces us to Chambers, the brilliant intellectual, anti-communist, and man of faith in Whittaker Chambers: The Spirit of a Counterrevolutionary.
After his exodus from the Soviet Communist spy network in Washington, Chambers then outed U.S. State Department official Alger Hiss as a communist, setting up a dramatic espionage trial played out before the nation. Chambers became a household name thanks to a trial that was wrapped in intrigue, treachery, and Cold War drama. Chambers would become a hero for many in the conservative movement. William F. Buckley, Jr. called him the greatest figure who defected out of communism. But Chambers’ pessimism about the future of the West led him to be dismissed by many others, conservatives too.
This pessimist view of the survival of the West against Marxism stems from Chambers’ understanding that the West was abandoning its sacred heritage of Christian thought, and within it, the proper understanding of man. A supposedly free but rampant secular and materialistic society still leads to the same ending as Marxism, outside of God, and unable to explain its reason and purpose for life.
One of the chief takeaways from this book is that there must be more to conservatism than free-markets and limited government. For liberty to be prosperous it must be oriented toward greater truths. Reinsch points out that Chambers understood that the “West must reject Communism in the name of something other than modern liberalism and its foundation in the principles of Enlightenment rationalism.”
Reinsch delves into Chambers prediction of the eventual collapse of the West and his belief that there was a lack of moral fortitude to combat the communist surge. The apparent unwillingness of the free world to sacrifice and suffer for freedom troubled Chambers. He also surmised that the intellectual class possessed a waning ability to articulate a meaningful defense of the ideas and value of the free society.
The United States did indeed emerge as the leader of the free world after the Second World War, rebuilding its former enemies with the Marshall Plan and other programs. Early on, the United States and Western Europe showed a stoic and moral resistance throughout the Berlin Airlift of 1948 and 1949. Future presidential administrations would pledge support for free people who toiled anywhere across the globe. President Ronald Reagan emerged in the latter half of the 20th Century, unveiling his own crusade against communism, making many of the deeper spiritual contrasts with the Soviet system first articulated by Chambers.
Reinsch also notes that while Chambers perhaps underestimated some of the spiritual will and capital to resist and overcome the Marxist onslaught, most of Chambers’s identification of the sickness of the West remained true. Reinsch declares of an America in the 1960s and 1970s:
Racked by mindless violence, strikes, rampant inflation, economic torpidity, and the rapid unfolding of sexual liberation, liberal democracy seemed to display, in acute form, the crisis of a material progress that had been severed from faith and freedom. Thus, the spirit of Chambers’s brooding over the fate of the West retained relevance.
This is evidenced in part by the immense suffering of Hanoi Hilton POWs like Admiral Jeremiah Denton, who in his captivity memoir When Hell Was in Session, described the disconnect of a man who sacrificed so much for freedom and who came out of the dark night with a deep sense of spiritual renewal only to come home to unearth an increasingly secular nation that was also retreating in its ability to defend and define its greatness.
Reinsch even points to further evidence that Chambers was right about the dangerous trajectory of the West when he cites the victory of the Cold War and how that surge of freedom did not posit any great change or realization of a higher transcendent understanding and purpose. While the superiority of markets was temporarily buoyed by the events, socialism has shown a staying power in the West.
Reisnch has crafted an important and essential book for anybody fatigued with the daily grind of hyper-partisan politics. By reintroducing conservatives to a deep thinker like Chambers, he reminds us of the limits of politics as well as the frustrating shallowness it can embody.
Just as markets and small government offer little ability in offering peace and happiness, though they certainly create greater space for a working towards that end, this account is a reminder that the best of conservatism is at its core within the ancient truths that tower above the vain materialism and individualism of secular Western democracy.
Believers can see this clearly when they look at the vanity of a society that prods, primps, and chases after meaning outside of God. Thus, as Reinsch adds, Chambers so wholly understood that “man’s problem was the problem of understanding himself in light of his fundamental incompleteness.” And that problem exists under communism just as it does in democratic capitalism, with its temptations to consumerism and selfishness.
The Marxist Utopian dream was man’s attempt at trying to fulfill its incompleteness with all the wonders and technology of modernity and materialism. The free world still is unable to relocate itself in the proper order. And, as Reinsch declares, this is a great warning to us all. Chambers so thoroughly understood and knew that “man was never more beastly than in his attempts to organize his life, individually and collectively, without God.”
Victor Claar, Acton University lecturer and professor of economics at Henderson State University, will give a talk tonight in Washington, D.C., hosted by AEI, “Grieving the Good of Others: Envy and Economics.”
If you are in the area, you are encouraged to attend and hear Dr. Claar as well as two respondents discuss the topic of envy and its moral and economic consequences.
Here’s a description of the event:
Critics of capitalism often argue that this economic system is irretrievably tainted by the sin of greed. They claim that by empowering government to “spread the wealth around” we can free ourselves from the tyranny of greed, purging the influence of sin. But are they right? At this event, Victor Claar, associate professor of economics at Henderson State University, will discuss the role of envy in collectivist and redistributive economic systems. Beginning with an explanation of the classic theological understanding of envy, Claar will argue that “grieving the good of others” is an unavoidable aspect of social democracy.
Tomorrow Dr. Claar will also be appearing as part of The King’s College Distinguished Visitor Series in NYC.
Dr. Claar is co-author of Economics in Christian Perspective: Theory, Policy and Life Choices as well as author of the Acton Institute monograph, Fair Trade? Its Prospects as a Poverty Solution.
As Dr. Claar will elaborate, the question that epitomizes envy, which is defined as “sorrow at another’s good,” is the self-centered concern, “What about me?” For fans of the hit TV series Lost, I can think of no better illustration of this than the turn from envy to malevolence in this climactic confrontation between Ben Linus and Jacob from the conclusion of season 5:
Until recently, many thought that Europe had escaped the worst of the 2008 financial crisis. Some even argued that the crisis has demonstrated the European social model’s superiority over “Anglo-Saxon capitalism”. In 2010, however, we have seen an entire country bailed out, riots in Athens, governments slashing budgets, and several European nations staring sovereign debt default in the face. Some are even claiming that the euro is finished. So what went wrong for Europe? How adequate have been the responses of European governments? And what are the consequences for America? The video is from the Aug. 2 Acton Lecture Series in Grand Rapids, Mich.
Forgive the blunt title of this blog post, but the point needs to be made in no uncertain terms.
The Zenit News Agency has interviewed John Medaille, author of Toward a Truly Free Market: A Distributist Perspective on the Role of Government, Taxes, Health Care, Deficits, and More, which calls for a direct if brief (more later, perhaps – I have yet to read the book) response from this Catholic defender of the market economy.
Whether or not Pope Benedict’s Caritas in Veritate is a boon to “alternative economics” as the Zenit interviewer claims, the market economy has come under attack from just about every corner since the global financial crisis of 2008. It’s easy enough to kick a system when it’s down, even when there’s plenty of blame to go around. Some critics, however, have been suffering through many decades of capitalist triumphalism to get their revenge. Among these are the distributists.
As I’ve noted in some recent blog posts, distributism has its origin in the writings of G.K. Chesterton and Hilaire Belloc who, for the brilliant Catholic apologists they were, seem to have known very little about economics. As the Zenit interviewer remarks, “many are skeptical, and believe distributism is simply romantic agrarianism, or worse, just an aesthetic sensibility, without any real practical solutions.”
Identified as a “neo-distributist,” Medaille wants to make up for the deficiencies of his fathers. He takes economics more seriously and argues that distributism is the “truly” free-market system compared to capitalism or socialism, though it should be remembered that Chesterton and Belloc also supported distributism in the name of economic liberty, private property and less interference from the state. Be that as it may. The question is ultimately whether distributism, neo- or paleo-, lives up to its claims as an “alternative” or “third-way.”
Medaille starts by critiquing the related notions that economics is a physical, rather than a human, science and that economics has nothing to do with ethics, especially justice. I don’t know who he is debating here. When I studied economics as an undergrad at a large secular university and worked as an international economist for the U.S. government, I may have come across such types, though no one was so brash to say that ethics didn’t matter. But it definitely does not describe those of us who appreciate Austrian economics and promote a Catholic understanding of the market economy.
More to the point, the question is how economics as a human science is to “practice” justice. How exactly can an economic system ensure justice between a buyer and a seller who come to a common agreement? Doesn’t the virtue of justice require just persons? And isn’t legal justice the purview of the state that legislates against force, fraud, theft, etc.?
For an example, Medaille says that, in matters of trade, foreign financing of domestic consumption is impoverishing to both parties and presumably unjust. While I could be convinced of its imprudence or undesirability in certain situations, I fail to see why or how such financing is always and everywhere unjust and therefore deserving of a blanket condemnation.
Medaille then states his case for distributism as the truly free-market system compared to capitalism and socialism. He makes the obvious point that any system that concentrates power is bound to leave individuals worse off and less free. Socialism is clearly guilty as charged but does capitalism necessarily lead to greater concentrations of economic power? The problem of concentrated power mainly occurs when corporations and the state work together – a.k.a. corporatism – which hardly describes a market economy worth defending and may even resemble the distributist model.
A truly free-market economy must allow free competition; it is only when capitalists collude to restrict competition that power is concentrated and freedom restricted. Yet this is precisely what guilds seek to do. Or have the neo-distributists distanced themselves from Chesterton and Belloc’s defense of guilds and critique of competition and advertising? I cannot tell.
Medaille is on firmer ground when he reminds us that the government should be doing less and that government interference often leads to the concentration of power. But he then ruins his case by looking to the state and trade associations to collude, which seems to be acceptable so long as it all happens at a local level.
Medaille explicitly proposes using tax policy, property law, licensing authorities and other political means to the advantage of some over others. But how is local government somehow exempt from draconian or overly restrictive interference? In fact, the history of republican government is full of such examples, especially in cases where an obstinate minority asserts its rights against the majority. The concentration of power often begins “small”, “locally” or “popularly” and grows from there; see Hayek’s The Road to Serfdom for a well-known demonstration of the phenomenon.
In the end, I am left wondering just what the distributists think is so good about economic freedom. As far as I can tell, it is not about using our God-given skills and talents through the division of labor for the benefit of all, and I see absolutely no mention of poverty reduction, longer life expectancies, medical and technological advances, the social virtues encouraged by commerce, and other goods brought about by economic freedom. The distributist vision of economic liberty and private property seems to feed a misguided notion of self-sufficiency and pride that is as antithetical to Catholic social teaching as materialism and consumerism.
Furthermore, the neo-distributist case for free markets is riddled with the same contradictions and problems that plagued its predecessor. Making the case against socialism and a mythical laissez-faire state of affairs is simply not good enough these days. Instead of urging serious Catholics and others who take ethics seriously to seek new economic models or “lifestyles,” why not encourage them to understand how markets work and what moral freedom and responsibility require from us as citizens and in the marketplace?