As Michael Novak observes in The Spirit of Democratic Capitalism, “A successful corporation is frequently based upon the principle of subsidiarity. According to this principle, concrete decisions must be made on the level closest to the concrete reality. Managers and workers need to trust the skills of their colleagues. A corporate strategy which overlooks this principle–and many do–falls prey to all the vices of a command economy, in which all orders come from above.”

Read more on No Executive Is An Island…

Over at the IFWE blog, Elise Amyx takes a look at Brian Fikkert’s argument about the origins of the modern American welfare state:

According to Fikkert, the evangelical church’s retreat from poverty alleviation between 1900 and 1930 encouraged the welfare state to grow to its size today. Church historians refer to this era as the “Great Reversal” because the evangelical church’s shift away from the poor was so dramatic.

In Faithful in All God’s House: Stewardship and the Christian Life, Gerard Berghoef and Lester DeKoster make a similar case. They argue that “the church is largely responsible for the coming of the modern welfare community.” They also cast the hopeful vision that another reversal might occur: “The church could be largely responsible for purging welfare of its faults and problems if enough believers caught the vision.”

While Fikkert is largely drawing on the early twentieth century in America for his argument, Berghoef and DeKoster examine more broadly the Christian perspective on the relationship between faith and works of charity. This dynamic is, after all, is a perennial challenge for Christian social engagement, and the interaction between the Social Gospel and evangelicalism in America is just one example. Another is the reversal over the last century or so in the Netherlands, where there has been a move from Abraham Kuyper’s claim that “all state relief for the poor is a blot on the honor of your Savior” to the church’s plea “for social security that is not charity but a right that is fully guaranteed by government.”
Read more on A Great Reversal of the Church & the Welfare State…

Today at Ethika Politika, I critique David Bentley Hart’s recent (non-)response to the critics of his attack on natural law in public discourse last month, appearing in the most recent issue of First Things. My article, “Hart’s (Non-)Response to His Critics: Trying to Have It Both Ways?” is a response to Hart’s recent article, “Si Fueris Romae.”

While Hart’s most recent article may seem unrelated, it starts to sound remarkably similar to his article on natural law from last month about half way through. It is this convergence between the two that I examine and critique.

Ultimately, Hart seems to be trying to “have it both ways” when it comes to natural law. I find this to be particularly evident from his conclusion, in which he criticizes US policy toward China, writing,

Decade upon decade, we hear of the arrest, imprisonment, torture, and murder of China’s religious minorities (house-church Christians, Tibetan Buddhist monks, and so on), of the cruel measures taken to enforce the nation’s one-child policy, and of countless other chronic atrocities, but our response consists in little more than a sporadic susurrus of disapproval, just loud enough to flatter ourselves that we have principles but not so loud as to allow those principles to interfere with fiscal or trade policy. We try to shame the ruling party with pious panegyrics on “human rights,” as though the concept had any appreciable weight outside the cultural context that makes it intelligible, but we buy and borrow from the party, and profit from its policies, without hesitation or embarrassment. I think the government of the PRC might be pardoned for concluding that our actions, and not our words, indicate where our true values lie.

While at Ethika Politika I critique his reliance upon the concept of natural rights even while claiming that only our “cultural context … makes it intelligible,” there is another point to consider here. Putting aside the inconsistency of his principles, would his recommendation — more restricted “fiscal or trade policy” — really have the effect that he hopes? Read more on The Hart of the Matter on Trade With China…

In the forthcoming issue of Comment magazine, I examine how free trade orients us towards the good of others. In doing so, I argue against the value of pious banalities and cheap slogans. I include examples like, “Go in peace; keep warm and well fed,” or, “When goods do not cross borders, armies will.” The latter is often attributed to Bastiat, and while it captures the spirit, if not the letter of Bastiat’s views, the closest analogue is actually found in Otto Tod Mallery: “If soldiers are not to cross international boundaries on missions of war,” wrote Mallery in 1943, then “goods must cross them on missions of peace.”

Read more on Trade, Aid, and Bumper Sticker Strategy…

My friend John Teevan of Grace College sends out a monthly newsletter, “Economic Prospect.” He passes along this in the current edition:

I found this note from a newly retired accountant (age 66) who has not gone on social security yet. His income as a part-time accountant in his town was $60,000.

Read more on Toiling for Pharaoh…

The newest issue of the Journal of Markets & Morality has been published. The issue is available in digital format online and should be arriving in print in the next few weeks for subscribers. This issue continues to offer academic engagement with the morality of the marketplace and with faith and the free society, including articles on economic engagement with Pope Benedict XVI’s encyclical letter Caritas in Veritate, biblical teaching on wealth and poverty, schools as social enterprises, the Reformed philosopher Herman Dooyeweerd’s economic theory, and much more.

As we have done in the past, Jordan Ballor’s editorial is open access, even to non-subscribers. In “Between Greedy Individualism Editorial and Benevolent Collectivism” he examines the enduring impact of Michael Novak’s The Spirit of Democratic Capitalism, writing,

At the time of its publication, Novak’s work must have been like a window thrust wide open in a dank room, introducing a breath of fresh air and the sanitizing rays of sunlight. Against ideologies that posit state power as a neutral or even benevolent force arising of necessity against the rapaciousness of the market, Novak observed instead that it was democratic capitalism that arose first as a system designed to check the invasiveness of state tyranny. The “founders of democratic capitalism,” wrote Novak, “wished to build a center of power to rival the power of the state.” Indeed, “they did not fear unrestrained economic power as much as they feared political tyranny.” Still more would they fear the union of economic and political power that we find all too often today in corrupt and cronyist regimes.

You can read his full editorial here. Read more on New Issue of the Journal of Markets & Morality (15.2)…

Why do the wicked prosper? This plaintive query is a consistent cry from the psalmist and the prophets. As Jeremiah puts it, “Why does the way of the wicked prosper? Why do all the faithless live at ease?”

Read more on Why Do the Wicked Prosper?…

In the Washington Times, Nile Gardiner praises Becoming Europe: Economic Decline, Culture, and How America Can Avoid a European Future, the new book by Acton Research Director Samuel Gregg. Gardiner, the director of the Margaret Thatcher Center for Freedom at The Heritage Foundation and a Washington-based foreign affairs analyst for The Telegraph, says Becoming Europe “should be on the desk of every member of the House and Senate who cares about the future of America as a prosperous and free nation.” Gardiner recommends the book for its “rich detail describing the economic and social ‘Europeanization’ of America, from the rise of vast welfare systems to growing skepticism of the merits of the free-enterprise system.” Excerpt from the review:

Read more on Review: Nile Gardiner on ‘Becoming Europe’…

On Nov. 28, the Canada-based Fraser Institute released the eighth edition of its annual report, Economic Freedom of North America 2012, in which the respective economic situation and government regulatory factors present in the states and provinces of North America were gauged.

Global studies of economic freedom, such as the Heritage Foundation’s 2012 Index of Economic Freedom and the Fraser Institute’s Economic Freedom of the World 2012, rank the United States and Canada as two of the most economically free countries in the world. But, as data from the North America report shows, not all sections of the countries are experiencing an equal level of economic freedom and it is important to look at areas in which this falters.

States and provinces were evaluated and ranked within three categories: 1) Size of Government; 2) Takings and Discriminatory Taxation; and 3) Labor Market Freedom. The Canadian province, Alberta, claimed the top spot as most economically free, followed closely by Delaware. New Mexico placed 59th, making it the least economically free state, followed by Prince Edward Island of Canada, notching the rank of least economically free area in North America (between the United States and Canada).

The Economic Freedom of North America 2012 report draws a clear link between prosperity and economic freedom, through a comparison of states and provinces. “In the United States, the relatively free Georgia does much better than the relatively unfree West Virginia. In Canada, British Columbia, where economic freedom has been increasing in recent years, has been experiencing considerably greater growth on a per-capita basis than Ontario, where economic freedom has been decreasing in recent years.” Read more on Economic Freedom: Vital for All…

Is spartan austerity driving us over the fiscal cliff?

The latest step in the budget dance between House Republicans and the White House has to do with where tax increases (or revenue increases in general, depending on what is called what) fit with a deal to avoid the so-called “fiscal cliff.” As Napp Nazworth reports, President Obama has apparently delivered an ultimatum: “there would be no agreement to avert the ‘fiscal cliff’ unless tax rates are increased on those making more than $250,000 per year.”

On one level it seems reasonable to talk about addressing a deficit from both directions: cutting spending and raising revenue. But as Ray Nothstine put it so well earlier this week, without some structural (and cultural) changes to the way Congress works, it would be insane to think that giving politicians more money is going to change how they spend it. One definition of insanity is doing the same thing over and over again and expecting a different result. Historically “politicians spend the money as fast as it comes in – and a little bit more.” Without some kind of balanced budget agreement, something with real teeth, why should we think things will be any different this time around? (I’ve talked about a more promising “both/and” budget solution before.) As Ray and I have concluded elsewhere, “In the case of the federal spending, the government has proved to be untrustworthy with very much. It’s time to see if the politicians in Washington can learn to be trustworthy with less.”
Read more on Spartan Austerity and the Fiscal Cliff…