Posts tagged with: capitalism

Sojourners’ Jim Wallis has been at the Davos gathering in Switzerland and is urging us to be guided by a new Davos “covenant.” If you’ve never heard of Davos, Michael Miller’s RealClear Politics piece “Davos Capitalism” describes the gathering and its unassailable hubris this way:

Davos capitalism, a managerial capitalism run by an enlightened elite–politicians, business leaders, technology gurus, bureaucrats, academics, and celebrities–all gathered together trying to make the economic world smarter or more humane…. And we looked up to Davos Man. Who wouldn’t be impressed by the gatherings at the annual meeting of the World Economic Forum at Davos, a Swiss ski resort? Sharply dressed, eloquent, rich, famous, Republican, Democrat, Tory, Labour, Conservative, Socialist, highly connected, powerful and ever so bright.

Then, when the whole managerial economy collapsed, the managers and technocrats lost faith in markets. But they did not lose faith in themselves, and now they want us to entrust even more of the economy to them.

As if on cue, Jim Wallis writes in a recent public letter:

This week at the World Economic Forum in Davos, Switzerland, we are looking to the future and asking “what now?” At a Saturday session — “The Moral Economy: From Social Contract to Social Covenant” — a document will kick off a year-long global conversation about a new “social covenant” between citizens, governments, and businesses.

Why dispense with the yeomen-like “contract” language in favor of a new “social covenant”? Wallis explains that “in the past 20 years, the world has witnessed the death of social contracts. We have seen a massive breakdown in trust between citizens, their economies, and their governments…. Former assumptions and shared notions about fairness, agreements, reciprocity, mutual benefits, social values, and expected futures have all but disappeared. The collapse of financial systems and the resulting economic crisis not only have caused instability, insecurity, and human pain; they have also generated a growing disbelief and fundamental distrust in the way things operate and how decisions are made.” (more…)

A friend sent me a link to a Reuters story on Pope Benedict XVI’s New Year’s homily. The article carried this headline: “Pope hopes for 2013 of peace, slams unbridled capitalism.”

It is always a good rule of thumb with media reports like this to read the actual speech or document being cited, and not just go by the headline. From the Reuters report one gets the impression that the point of the statement and its theme is that the “Pope slams capitalism.”  When you read this in context you immediately see that Pope Benedict is actually calling for conversion. The operative phrase employed by the Holy Father in his homily is, “The prevalence of a selfish and individualistic mindset which also finds expression in an unregulated capitalism, various forms of terrorism and criminality.”

I say in Defending the Free Market: The Moral Case for the Free Economy that “global capitalism can’t of itself supply the cultural and moral formation worthy of the human person … our increasing interconnectedness holds great potential for offenses against human dignity. Advances in technology and communication can make it easier to sell pornography – or to traffic in human beings…” and so on.

In other words, I stand with the pope, that sin (what he calls in this case a “selfish and individualistic mindset”) can find expression in the context of human liberty lacking moral orientation, (what he calls in this instance, “global capitalism”).

Is the pope saying that capitalism is in and of itself “selfish and individualistic”? No. Can it express the vices (and for that matter the virtues) of people living in free economies? Yes.

That is why the Acton Institute exists — to promote virtuous free economies.

solar light, developing worldOver a billion people are still using kerosene as a primary fuel source, with over 1.5 million dying annually from issues related to indoor air pollution and kerosene fires. For many in the developing world, solar lamps are a new, inexpensive solution to the problem. A recent piece in The Economist hails solar lamps as the next “mobile phone” for the poor, noting that “its spread is sustainable because it is being driven by market forces, not charity.”

In an article for Christianity Today’s This is Our City project, HOPE International‘s Chris Horst interviews two business leaders from the industry who share how their purpose and direction in providing these products stems from a strong missional orientation toward work and a belief in the power of markets.

For Brian Rants, vice president of marketing for Nokero, a leading solar light company, involvement in the industry came after a fundamental transformation in his thinking:

“I am very surprised to find myself in business,” Rants says. “Business seemed to be a backup plan to being a missionary. Or being a pastor like I thought I would be. It seemed like businesspeople were just ‘extras’ in God’s story, rather than lead or even supporting actors.”

Over the past ten years, Rants worked for a number of nonprofits and churches. After going through graduate school, however, he began to discover the ways enterprise is improving the lives of the poor around the world. Rants excitedly joined Nokero, equipped with a restored vision of vocation. Through leveraging his knack for marketing, Rants fights poverty not just through his volunteerism and philanthropy, but inherently through his work in business. (more…)

Blog author: dpahman
Tuesday, December 18, 2012

I recently asked the question at Ethika Politika, “Which Capitalism?” (also the title of my article), and I followed it up with a related question here regarding the relationship between distributism and capitalism (is the former a form of the latter?). In addition, Jordan Ballor reflected last week on the different orientation of definitions of capitalism and socialism, observing, “One definition [i.e. capitalism] is focused on structure, the other [i.e. socialism] is connected with moral ideals.”

On a related note, I found this post from Matt Mitchell at Neighborhood Effects to be quite to the point as well:

Google Chairman Eric Schmidt defended the company’s practices [of taking certain tax exemptions], saying:

We pay lots of taxes; we pay them in the legally prescribed ways…. I am very proud of the structure that we set up. We did it based on the incentives that the governments offered us to operate.

So far so good. He didn’t make the rules that privilege his firm, but he will avail himself of these privileges when offered. I can sympathize. I oppose the mortgage interest deduction but still take it every April. Schmidt’s next statement, however, is about as far from the mark as one can get:

It’s called capitalism…. We are proudly capitalistic. I’m not confused about this.

A quick lesson for Mr. Schmidt: genuine capitalism is about competing on a level playing field for customer dollars. If you offer a superior product or service, customers will reward you by voluntarily parting with their money in exchange for what you offer. (more…)

Blog author: dpahman
Wednesday, December 12, 2012

G. K. Chesterton
(one of the founding fathers of distributism)

Today at Ethika Politika, in response to a few writers who have offered, in my estimate, less-than-charitable characterizations of capitalism, I ask the question, “Which Capitalism?” (also the title of my article). I ask this in seriousness, because often the free economy that people bemoan bears little resemblance to the one that many Christians support. In particular, I ask, “Which Capitalism?” in reference to the following from Pope John Paul II, who outlines in his encyclical Centesimus Annus (no. 42) two different forms of capitalism as follows:

The first is “an economic system which recognizes the fundamental and positive role of business, the market, private property and the resulting responsibility for the means of production, as well as free human creativity in the economic sector” that “is the victorious social system” since the fall of the Soviet Union and that “should be the goal of the countries now making efforts to rebuild their economy and society.” The second is “a system in which freedom in the economic sector is not circumscribed within a strong juridical framework which places it at the service of human freedom in its totality, and which sees it as a particular aspect of that freedom, the core of which is ethical and religious.”

All three of the authors I take issue with are Roman Catholic and two of them have voiced their support for distributism as an alternative to capitalism. However, I ask with all sincerity, “[S]hould not distributists be asking whether distributism is a form of capitalism, rather than setting it up as an alternative to capitalism?” Given the high praise given by Pope John Paul II to capitalism, rightly understood as the free economy, ought not distributists simply be arguing that they, perhaps, have some valuable insights for supporters of capitalism, rather than opposing distributism to capitalism, uncharitably understood? (more…)

Bono, foreign aid, development, capitalismBono, lead singer of U2 and co-founder of charity-group ONE, recently offered some positive words about the role of markets in reducing global poverty and spurring economic development (HT):

The Irish singer and co-founder of ONE, a campaigning group that fights poverty and disease in Africa, said it had been “a humbling thing for me” to realize the importance of capitalism and entrepreneurialism in philanthropy, particularly as someone who “got into this as a righteous anger activist with all the cliches.”

“Job creators and innovators are just the key, and aid is just a bridge,” he told an audience of 200 leading technology entrepreneurs and investors at the F.ounders tech conference in Dublin. “We see it as startup money, investment in new countries. A humbling thing was to learn the role of commerce.”

The remarks have led to relative hype in “pro-market” circles, but I’d remind folks that these are brief statements made to a small group of innovators and entrepreneurs. ONE has plenty of wrinkles in its past, and Bono’s primary legacy in this arena consists of promoting the types of ineffective, top-down social engineering that groups like PovertyCure seek to expose. When Bono continues to claim that foreign aid, as he understands it, is still a “bridge”—even if just a bridge—it’s reasonable to assume that his orientation toward “bridge-building” has been left largely unchanged by his newfound appreciation for markets.

But although I’m not overly confident that Bono’s sudden self-awareness is enough to radically shift his aid efforts away from fostering dependency, this small admission helps illuminate one of our key obstacles to doing good in the world: overzealousness paired with overconfidence.

The Fund for American Studies has produced a superb It’s a Wonderful Life-style video about life without capitalism. The video not only shows what life would be like if we banned free enterprise (i.e., a lot like Soviet Russia) but also makes the point that when you lose economic freedom you lose other freedoms too. As the angel says, “When you take away the carrot, all you’re left with is the stick.

My favorite part of the video:

Anti-capitalist activist: “I just wanted to get rid of the greed. I didn’t want to get rid of my microwave, my air-conditioner. . . ”

Angel: “Your Xbox.”

Activist: “My Xbox is gone?”

Angel: “Yeah, well, in this world that greedy Bill Gates work in a bowling ball factory in Akron. Lose-win, right?”

(Via: Cafe Hayek)