Posts tagged with: economics

Blog author: jballor
posted by on Thursday, June 3, 2010

I just finished writing a review of Robert H. Nelson’s book, The New Holy Wars: Economic Religion vs. Environmental Religion in Contemporary America (Penn State University Press, 2010) that will appear later this year in Calvin Theological Journal. It is a good book. It is a timely book. There are flaws, but overall there is much to learn from Nelson’s analysis.

I found a good summary passage that appears as a footnote on p. 171:

The terms ecology and economics have common linguistic origins, both derived from the Greek word oikos for home. Both offer grand theories of the world that reflect a vision of the actual relationship of human beings and nature. The largest “ecology” and the largest “economy” are in each case the whole world, including all its creatures, human and nonhuman. There are then many subecologies and subeconomies that ecological theory both seek to integrate within their respective overall systems of thought. It has proven difficult, however, to apply mathematical and other rigorous scientific methods to understand the workings of the largest economic and ecological systems, thus often encouraging in both cases those who do undertake such efforts to interject their own strongly held values and beliefs in implicit ways—that is, to turn economics and ecology into metaphors of religious thought.

That should give you an idea of what Nelson means when he describes economics and environmentalism as competing secular “religions.” I expect to post a series of reflections on the book in this venue in the coming weeks, as it is a significant work that merits more comment and attention than could be devoted to a short book review.

At the Volokh Conspiracy, Todd Zywicki looks at a new article by Zeljka Buturovic and Dan Klein in Econ Journal Watch which aims to “gauge economic enlightenment based on responses to eight economic questions.” Among other things, the researchers filter the survey results for political ideology. Zywicki’s highlights:

  • 67% of self-described Progressives believe that restrictions on housing development (i.e., regulations that reduce the supply of housing) do not make housing less affordable.

  • 51% believe that mandatory licensing of professionals (i.e., reducing the supply of professionals) doesn’t increase the cost of professional services.
  • Perhaps most amazing, 79% of self-described Progressives believe that rent control (i.e., price controls) does not lead to housing shortages.
  • Zywicki said that “the questions here are not whether the benefits of these policies might outweigh the costs, but the basic economic effects of these policies. Those identifying as “libertarian” and “very conservative” were the most knowledgeable about basic economics. Those identifying as ‘Progressive’ and ‘Liberal’ were the worst.”

    Volokh blogger Ilya Somin follows with a number of caveats about the survey.

    The study certainly rings true when measured against the economic pronouncements of “progressive” faith-based groups. As I showed in my review of Prophet Jim Wallis’ latest book, the religious left’s understanding of basic economic principles is pretty dismal.

    Former Acton colleague, Jay Richards just reported that his book Money, Greed, and God has just been released in paperback. It is a thoughtful Christian analysis of the market economy and an excellent summary of the many key fallacies that plague the way we understand–or rather misunderstand–economics.

    He writes:

    My tentative title for the book had been The Christian Case for Capitalism. I had even referred to it that way for a couple of years while I was working on it. But the publisher came up with Money, Greed, and God: Why Capitalism Is the Solution and Not the Problem. I have friends who still think my original idea is preferable, but I’m not so sure. I’ve haven’t gotten a sense that anyone has been confused about the title. The only negative effect is that a few wags have suggested that “Money, Greed, and God” sounds like the platform for the Republican Party. I gotta admit, that’s pretty funny.

    In any case, the more controversial question has been, why did I choose to defend something called “capitalism”? Wouldn’t it have been better to put “free enterprise” or “free market” in the title? I do have some thoughts about that, which I’ll write about later. But I should say that I was quite intentional in defending something called “capitalism.”

    You can also order a copy of the book at the Acton Book Shop. We’ll have paperback copies in stock soon.

    Blog author: jcouretas
    posted by on Friday, March 5, 2010

    The control of wealth is the control over human life. So if a centrally planned economy decides how wealth is to be created and how it is to be distributed, then they really have a control over human life.

    That’s from Arnold Beichman, the journalist and scholar, who died Feb. 17 at the age of 96. The Heritage Foundation InsiderOnline Blog retrieved the quote from a 2004 article in a Columbia College alumni magazine. There was also this:

    Centrally planned societies, Beichman says, are essentially fascist. “Even with computers, you can’t plan, because the human being does not allow himself to be planned. Today he smokes cigarettes; tomorrow he’s off cigarettes. How do you plan for that? Today he drinks vodka, tomorrow he drinks white wine. How do you plan for that? … It’s the open, the market society, that will determine what is made and what is sold and what is bought.”

    Blog author: jballor
    posted by on Monday, February 15, 2010

    Longtime Acton friend John H. Armstrong notes the recent discussion of Rowan Williams’ pronouncements on ethics and the economy here at the PowerBlog, commenting that “The archbishop of Canterbury is an extremely likable Christian gentleman, a first-class Christian scholar. He is also a leader who often fails to address some of the more difficult issues in our time with a straight, clear answer.”

    Armstrong’s description of Williams coheres well with the overall picture of theologians engaging economics presented by Susan Lee, who says, “The habit of picking and choosing means that many theological discussions of economics take place under a cloud of incoherence, or at least to economists, ignorance.”

    In this brief piece from APM’s Marketplace, “Bridging the theology-economy gap.” Susan Lee, “an economist and a theologian based in New York City,” passes along her experience at a public appearance that included Rowan Williams. She gets of some real substantive observations, including the following:

    …ethics are the common ground for theology and economics…

    Both theologians and economists are interested in improving the lives of all humans. Both groups agree on policy goals like low unemployment and sustainable growth. In fact, these goals are in harmony with a definition offered by the archbishop. He said: “An ethical economy is one where we care for our neighbor by creating conditions so the most vulnerable aren’t abandoned.” Well, this is a description of capitalism in the U.S….

    Economists are interested in how to make the pie larger. Theologians are interested in how to divide the pie. And so many theologians treat capitalism like a Chinese menu. They pick the wealth-distribution parts and discard the wealth-creation parts….

    Her commentary is brief, but worth reading or listening to in full. Jeff Walton at the IRD also provides some background for the Trinity Institute event, and includes fuller observations from Lee (HT).

    Camarin M. Porter of the Department of History at University of Wisconsin-Madison reviews a text edited by Stephen J. Grabill, Sourcebook in Late-Scholastic Monetary Theory: The Contributions of Martin de Azpilcueta, Luis de Molina, and Juan de Mariana (Lexington, 2007). The review appears courtesy of H-Net, a unique and indispensable set of list-servs hosted by Michigan State University.

    The Sourcebook includes translations into English of selected texts from the significant figures listed in the book’s subtitle, as well as a general introduction by Grabill and specialized introductions for each text: Azpilcueta’s Commentary on the Resolution of Money (1556), Molina’s Treatise on Money (1597), and Mariana’s Treatise on the Alteration of Money (1609).

    In this extensive review, Porter writes, “For each of the three texts, the Sourcebook efficiently accomplishes its goal of setting each authors’ specific concerns in areas of moral theology and economics within full social and intellectual contexts.”

    I think the country IS discovering its inner Dave Ramsey. The savings rate keeps going up.

    People are self-consciously trying to protect themselves from uncertainty. At first, it was to protect against a private sector meltdown. Now, it is an attempt to protect against public sector profligacy.

    In both cases, this new found habit of saving keeps the economic motor running slow and low. Government attempts to overcome that instinct are bound to fail. The only thing that will loosen up wallets will be if citizens sense that economic growth has a real basis rather than a “the government commands it so” one.

    Blog author: jballor
    posted by on Wednesday, November 25, 2009

    Some of the aspects of the movement in ‘new economics’ highlighted by Sumita Kale sound quite promising. For instance, it is true that “many issues of economic policy (traditionally called ‘welfare economics’) are primarily ethical-economics in nature, and should be informed by moral philosophy rather than economics in isolation.” The growing conversation between economics and other disciplines, specifically moral philosophy and theology, is most welcome.

    Indeed, some of the principles animating the work of the Cambridge Trust for New Thinking in Economics sound similar notes: “economic behaviour is influenced by aesthetic and ethical values as well as economic values.”

    But when we drill down to the objectives of the Trust and look at some of the other principles, it becomes clearer that what is “new” about “new economics” is that economic research is pursued with an overtly and explicitly socio-political agenda: “It is vital that two social problems be solved. The first is the obvious degradation of the planet and its atmosphere by over-consumption and over-production through the exploitation of resources in pursuit of monetary gain. The second problem is the toxic pollution of the global money supply, also obvious, caused by financial practices over the past twenty years, led by the investment banks of Wall Street and the City of London.”

    What we have here is economics as social engineering, providing norms for behavior rather than describing it. “New” economics (traditional economics with just a dash of moral philosophy thrown in) becomes a prescriptive rather than a descriptive discipline, and therefore simply one more voice among many clamoring for dominance in the legislative process.

    Blog author: jballor
    posted by on Monday, November 23, 2009

    Contrary to the belief of some, the two realities referred to in the title of this post are not identical.

    But the discussion around a recent Boston Globe article reminds me of the saying from Jerry Taylor, a senior fellow at the Cato Institute, “Capitalism without the threat of bankruptcy is like Christianity without the threat of hell. It doesn’t work very well.” It may well be that capitalism without the threat of hell doesn’t work very well either.

    The Globe piece refers to a bit of research that links belief about punishment in the afterlife with economic development. This is important, since “knowing exactly how and when God influences mammon could lead to smarter forms of economic development in emerging nations, and could add to our understanding of how culture shapes wealth and poverty.”

    It is promising that there is “a larger movement in economics, in which the field is looking beyond purely material explanations to a broader engagement with human culture, psychology, and even our angels and demons.”

    Blog author: jballor
    posted by on Wednesday, October 21, 2009

    The Workshop in Political Theory and Policy Analysis at Indiana University has announced the launch of a new initiative focused on the thought of Alexis de Tocqueville.

    The Tocqueville Program aims “to foster an understanding of the central importance of principles of freedom and equality for democratic government and moral responsibility, as well as for economic and cultural life.”

    The program’s first event will be held next month (November 6), and is titled, “What’s Wrong with Tocqueville Studies, and What Can Be Done About It.”

    IU professor Elinor Ostrom, the most recent winner of the Nobel Prize in economics, co-founded the Workshop in Political Theory and Policy Analysis.