Posts tagged with: wealth

The Good Rich and What They Cost Us, Robert Dalzell Jr.In a new book, The Good Rich and What They Cost Us, Robert Dalzell Jr. aims to address “a great paradox at the core of the American Dream: a passionate belief in the principles of democracy combined with an equally passionate celebration of wealth.”

In a review for the Wall Street Journal, Amity Shlaes notes that although the book provides an in-depth look at the history of American philanthropy, the author’s own personal prescriptions lend too high a trust to government redistribution:

“The Good Rich” starts out like a tour through a portrait gallery, describing rather than judging. For much of his narrative, Mr. Dalzell refrains from giving his own opinion explicitly and reports merely that the rich have often blamed themselves for their lapses or oversize good fortune, or that their peers did.

Toward the book’s end, though, Mr. Dalzell drops his own screen, putting forward a familiar argument: that democracy suffers unless wealth and philanthropy are redistributed to reduce economic inequality. Even the “good rich” cost us: They don’t give wisely, Mr. Dalzell contends, spending too much on “elite institutions like Harvard, Yale, MIT and Princeton, which seems unlikely to reduce the income gap by much.” …For the sake of the public good, then, the rich must fashion better charity projects while handing over more of their money to the government.

Such philanthropic efforts deserve to be thoroughly examined. Likewise, from the poorest of us to the wealthiest, we should be energetic in examining our own activities, using discernment and wisdom in how we use our resources. But as Shlaes indicates, if it’s difficult for we individuals to wrestle with these deep questions about stewardship — particularly when we’re calling on the Divine for wisdom, as many philanthropists under Dalzell’s microscope claim to have done — how much more difficult will it be for a bloated government machine to utilize proper discernment? (more…)

Radical Together, David PlattOver at Thought Life, Owen Strachan uses David Platt’s book, Radical Together, as a launching pad for asking, “Are you and I making and using money as if there is no such thing as the work of the gospel?”

I’ve already written about my disagreements with Platt’s approach in his first book, Radical: Taking Back Your Faith from the American Dream, and Strachan expresses similar reservations. While appreciating Platt’s emphasis on “exaltation of and dependence on a sovereign, awesome God,” Strachan is concerned that on the topic of wealth—a primary target of Platt’s—readers might easily rush to the assumption that wealth and prosperity are bad altogether.

Evangelicalism desperately needs Platt’s laser focus on the gospel and missions. The church exists to make disciples for the glory of God, both locally and abroad. I would only point out that I think that wealth and philanthropy can actually be our friend here. In other words, if you want to apply the “radical” model–with its many strengths–I can think of few things more radical than using one’s wealth for gospel purposes. Maybe the most spiritual thing to do to support the promotion of the gospel is this: stay in your job, save and invest scrupulously, and keep pumping out money to support missionaries and pastors.

Here’s just one example of thousands we could give on this point. A forgotten man named Henry Parsons Crowell made vast amounts of money through the Quaker Oats company. Did he hoard it? Nope. He gave away 70% percent of his massive income and helped bankroll Moody Bible Institute, the school that…has sent out thousands upon thousands of missionaries in its century of ministry. Yes, every time you eat Quaker Oats, you’re paying masticular homage to a man who–merely by giving money–helped catapult the gospel all over the world

…This is a testimony to what wealth, including but not limited to truly fabulous wealth, can do if committed to the Lord. It’s one of countless others we could share of evangelicals of great or small means who tucked money away not for themselves, but for the work of Christ’s church. (more…)

King Solomon, the original 1%

King Solomon, the original “1%”

Last Thursday, NPR ran an interesting piece by Alan Greenblat that featured the perspective of several of the nation’s rich (read: annual household income over $250,000) in relation to President Obama’s determination that the Bush era tax increases end for the nation’s rich as part of any deal related to the looming “fiscal cliff.” The article features a variety of perspectives, but I would like to reflect upon one particular section of that article here. Greenblat writes,

[Mark] Anderson recognizes that the kind of tax increases Obama proposes aren’t going to impinge on his life materially, and he supports them philosophically. But he adds that he thinks Obama and other Democrats make being rich “sound like a bad thing,” which he says is a mistake.

The top 2 percent of earners already pay 35 percent of all federal taxes, according to the Tax Policy Center. In terms of personal income taxes, the top 1 percent alone pay 37.4 percent of total receipts, according to the Tax Foundation — double the share they paid back in 1979. [Edward] Kfoury, who is president of a land trust in Maine, points out that there are years when his personal tax bill has run into seven figures.

“What would make me feel a lot better is if I heard the president say, ‘I want to thank the rich people who, because of our progressive tax system, pay the most — but we don’t have enough money, so we’re asking the wealthy people to help the country out by paying more than their fair share,’ ” says Martin Krall, a 71-year-old “semi-retired” attorney and media executive who lives in Palm Beach Gardens, Fla.

“Instead, you’re made to feel like you’re a bad guy,” Krall says. “People resent the notion that somehow they’ve done something wrong by becoming successful.”

Joe Carter recently examined why soaking the rich won’t fix the deficit, so I will not explore that question here. Instead, I would like to focus on the issue of human dignity, political rhetoric, and an ancient Christian perspective on wealth. (more…)

Forbes recently ran a profile of Christian billionaire and Hobby Lobby CEO David Green. According to Forbes, Green is “the largest evangelical benefactor in the world,” giving “at upwards of $500 million” over the course of his life, primarily to Christian ministries.

Yet, for Green, his strong Christian beliefs don’t just apply to how he spends his wealth; they’re integral to how it’s createdin the first place:

Hobby Lobby remains a Christian company in every sense. It runs ads on Christmas and Easter in the local paper of each town where there’s a store, often asserting the religious foundation of America. Stores are closed on Sundays, forgoing revenue to give employees time to worship. The company keeps four chaplains on the payroll and offers a free health clinic for staff at the headquarters–although not for everything; it’s suing the federal government to stop the mandate to cover emergency contraception through health insurance. Green has raised the minimum wage for full-time employees a dollar each year since 2009–bringing it up to $13 an hour–and doesn’t expect to slow down. From his perspective, it’s only natural: “God tells us to go forth into the world and teach the Gospel to every creature. He doesn’t say skim from your employees to do that.”

Economists have increasingly recognized the ways in which healthy stewardship and property rights are linked—how increased ownership leads individuals to weigh costs and benefits more thoughtfully and effectively. Green’s comments add a slight twist to this approach, calling Christians in particular to reconsider who the “owner” actually is and how we might weigh particular costs/benefits and subsequent action accordingly:
(more…)

French President François Hollande has promised a 75% tax rate on those in his country who earn an annual salary above one million euros ($1.24 million). Not surprisingly, this number has struck fear into the hearts and wallets of quite a few of France’s top earners, including some who are contemplating leaving and taking their jobs with them. The New York Times has the story:

Many companies are studying contingency plans to move high-paid executives outside of France, according to consultants, lawyers, accountants and real estate agents — who are highly protective of their clients and decline to identify them by name. They say some executives and wealthy people have already packed up for destinations like Britain, Belgium, Switzerland and the United States, taking their taxable income with them.

They also know of companies — start-ups and multinationals alike — that are delaying plans to invest in France or to move employees or new hires here.

The potential tax increase threatens to handcuff “les Riches” and, ironically enough, undercut France’s prized notion of egalité, taking with it liberté and fraternité, the remainder of the country’s tripartite maxim. In Hollande’s France, these principles may not apply to the wealthy.

Of course, Hollande’s tax initiative is sure to have some beneficiaries. No, not the poor or the middle class. The real winners? Well, they live on the other side of the border. Also from the Times:

“It is a ridiculous proposal, but it’s great for us,” said Jean Dekerchove, the manager of Immobilièr Le Lion, a high-end real estate agency based in Brussels. Calls to his office have picked up in recent months, he said, as wealthy French citizens look to invest or simply move across the border amid worries about the latest tax.

“It’s a huge loss for France because people and businesses come to Belgium and bring their wealth with them,” Mr. Dekerchove said. “But we’re thrilled because they create jobs, they buy houses and spend money — and it’s our economy that profits.”

The entire story reminds me of a passage from Rev. Robert Sirico’s latest book, Defending the Free Market: The Moral Case for a Free Economy. In a chapter titled “The Idol of Equality,” Sirico addresses the unsustainable nature of simple redistribution. Instead, business development and job creation are essential–and lasting–tenets of economic growth. From the book:

When most people picture the 1 percent and their wealth, what comes to mind is designer clothing and jewelry, yachts and limousines, mansions and penthouses—all sorts of alluring and attention-grabbing luxuries. Luxuries so distracting, in fact, that we tend to lose sight of the fact that most of the wealth of the wealthiest is invested. It is put to work in the businesses they own and manage, and in stocks and other financial vehicles that provide the capital for countless other businesses. These are the businesses that provide the 99 percent with the goods, services, and employment that they regularly enjoy and often take for granted.

Whether it’s a big automotive plant or a small bakery on the corner, a microchip manufacturer or a family farm, all businesses that produce goods and employ people are owned by someone. It’s businesses that make up most of the wealth of the 1 percent. Confiscating that wealth and giving it to the other 99 percent would mean shifting much of that wealth from investment and production to consumption, since the poor and middle class consume a far higher percentage of their income than the wealthy do. This sudden shift from investment and production to consumption would demolish the infrastructure that makes jobs, goods, and services possible.

Hollande would be wise to read Defending the Free Market. Doing so might save his nation and preserve liberty, equality and brotherhood in the process.

I was listening to news radio and heard an update in which the senate majority leader Harry Reid gave his interpretation of events on the debt ceiling negotiation. The part that really got my attention was where he insisted that further committee work would go after those “millionaires and billionaires.”

I wondered, “What is he really saying?” Let’s begin with millionaires and billionaires. Is Reid charging them with having committed some evil? If a person had made a lot of money by force or fraud, then I would agree that disapproval and punishment might be merited. Can we confidently say that rich people, as a class, have committed evils which make them suitable subjects of a public official’s desire to punish?

Why is he so angry? Why does he make these people sound like bad people? Is it the fact that they have quite a bit of money? I suspect he does, too. Indeed, it has been noted that Reid has become a somewhat wealthy man while holding office. Does he impute ill motives or actions to himself by virtue of his possession of resources well above the average?

What if we do think that having a lot of wealth is a sign of moral weakness? Perhaps we believe that having much more money than is needed to live (even live comfortably) represents a bad choice. Even if we think that, does that mean we invest the government with the moral right to appropriate that wealth as needed so as to operate without hard debates about limits on spending? Maybe our only right is the right to have our own opinion of how wealthy people should spend their money.

I think Harry Reid needs to think more about why he’s so morally exercised. Follow the conclusions of that anger and maybe we’ll get down to basic principles. Once we get there we can have a legitimate discussion.

Urban prairie Detroit 2I wrote a bit about my short essay describing some of the principles and concepts at play concerning intergenerational ethics and economics. There are also important intergenerational cultural consequences following the Great Recession. A decade ago there was much concern about the rootlessness of current generations and the transience of the workforce. But that ability for workers to move quickly to new jobs in other cities and states has been undermined by the housing crash. Most anyone who bought a home in the last decade will not be moving anywhere anytime soon.

As Robert Bridges contends in a WSJ op-ed, “Coming generations need to realize that while houses are possessions and part of a good life, they are not always good investments on the road to financial independence.” The “ownership society” means something far different today than it did even a decade ago.

In her book How the West was Lost, Dambisa Moyo describes well some of the background leading up to the housing crash. One of the contributing factors was this cultural ideal of a “homeownership” society and resulting government policy to promote homeownership. She contends,

The direct consequence of the subsidized homeownership culture was the emergence of a society of leverage, one where citizen and country were mortgaged up to the hilt; promoting a way of life where people grew comfortable with the idea of living beyond one’s means.

She also judges that there are significant intergenerational implications:

Under the government guarantee system which propels the rapid appreciation of house prices, the only winners are those who can downsize (downgrade) their housing, or move to a different area, and buy a smaller (cheaper) place. Everyone else loses…. This ‘escalator’ effect continues until the time that the kids go to college. It’s a wealth transfer from the younger generation to the older generation as house prices become more expensive.

One of the effects of what Moyo calls “government guarantee system” is that resources (capital) was increasingly invested in homes that might have been invested in other, more productive, sectors.

An incisive piece by Roben Farzad explores why the aftereffects of the housing bubble are not likely to go away anytime soon. He quotes Doug Ramsey of Minneapolis investment firm Leuthold Group, “a student of asset bubbles,” who says, “The housing decline will be a long, multiyear process, and the multiplier effect across the economy will be enormous.”

Jonathan Smoke, head of research for Hanley Wood, a housing data company, argues, “We’ve gone through a period when we should have been tearing down houses. The supply of total housing stock is beyond what is necessary.”

Why then are we still celebrating “new housing starts” as signs of a rebounding economy rather than a continuation of misplaced investment and cultural priorities?

In his recent lecture “Christian Poverty in the Age of Prosperity,” Rev. Robert Sirico reminded us that “We should not minimize the demands of the scripture but we should embrace them.” The quote was in context of caring for the vulnerable among us. He also talked about the need to be wholly devoted to the Lord despite the distractions of technology and prosperity in our midst.

At the same time, Rev. Sirico also admonished religious figures who offered superficial exegetical statements condemning all wealth. A great example being a topic I previously covered on the PowerBlog, “The What Would Jesus Cut?” campaign. In my devotional reading this week, I came across a very appropriate quote by 17th century English Puritan Jeremiah Burroughs. The words compliment the pastoral tone Rev. Sirico set during the lecture, and reminds us just how woefully inadequate superficial pronouncements are when it comes to the gospel call. Burroughs words are below:

Suppose a man had great wealth only a few years ago, and now it is all gone-I would only ask this man, When you had your wealth, in what did you reckon the good of that wealth to consist? A carnal heart would say, Anybody might know that: it brought me in so much a year, and I could have the best fare, and be a man of repute in the place where I live, and men regarded what I said; I might be clothed as I would, and lay up portions for my children: the good of my wealth consisted in this. Now such a man never came into the school of Christ to know in what the good of an estate consisted, so no marvel if he is disquieted when he has lost his estate. But when a Christian, who has been in the school of Christ, and has been instructed in the art of contentment, has some wealth, he thinks, In that I have wealth above my brethren, I have an opportunity to serve God the better, and I enjoy a great deal of God’s mercy conveyed to my soul through the creature, and hereby I am enabled to do a great deal of good: in this I reckon the good of my wealth. And now that God has taken this away from me, if he will be pleased to make up the enjoyment of himself some other way, will call me to honor him by suffering, and if I may do God as much service now by suffering, that is, by showing forth the grace of his Spirit in my sufferings as I did in prosperity, I have as much of God as I had before. So if I may be led to God in my low condition, as much as I was in my prosperous condition, I have as much comfort and contentment as I had before. – Jeremiah Burroughs, from his book Rare Jewel of Christian Contentment

Below is the full-length version of “The Rich Young Man: The Law Versus Privilege,” an essay published in the winter 2011 Religion & Liberty. John Kelly’s essay was shortened because of space limitations for the print issue. He was passionate about sharing the full version, which he edited himself for readers of the PowerBlog. Mr. Kelly, a financial advisor, also authored a piece in 2004 for Religion & Liberty titled “The Tithe: Land Rent to God.”

— — — — — —

THE RICH YOUNG MAN: THE LAW VERSUS PRIVILEGE

by John Kelly

As Jesus conducted his public ministry, he drew considerable crowds. Within the throngs were, of course, the peasants of the neighborhood, along with longer-term disciples. There were many who wished to see miracles, many who wished to hear his sayings of peace, love, hope and promise. There were those who wanted reinforcement of the Law and those who wished to see some of the Law abandoned. And within all these groups were many who were troubled by personal doubt.

Jesus spoke with these people, engaging them, answering their questions, asking them questions, all the while proclaiming the authority and the efficacy of the Law. He said, “Do not imagine that I have come to abolish the Law or the Prophets. I have come not to abolish – but to complete them.” He then goes on – he’s trying to make sure his listeners understand: “In truth I tell you, till heaven and earth disappear, not one dot, not one little stroke, is to disappear from the Law until all its purpose is achieved.” (Matthew 5:17-18 – NJB)

Some of Jesus’ most engaging images come from these conversations. Rich and poor, titled and powerless, legalists and apostates, disciples and strangers all had encounters with Jesus that fleshed out for them his view of the Law. However, our lack of knowledge regarding the economic, political and cultural environment in which Jesus lived and preached sometimes hampers our understanding of his message.

One of the more famous of these encounters was with the rich young man. This story is found, in almost identical versions, at Matthew 19:16-22, Mark 10:17-22 and Luke 18:18-23. He approached Jesus and asked what was necessary to be saved. “Good Master, what must I do to inherit eternal life?” Jesus replied that the young man should keep the commandments. “I have kept all these,” stated the rich young man, “What more do I need to do?” Jesus said to him, “If you wish to be perfect, go and sell your possessions and give the money to the poor … then come, follow me.” This was too much for the young man. Scripture says that he “went away sad, for he was a man of great wealth.”

This story seems too hard for most of us. What is fundamentally wrong with being rich? Preachers try to make sense of this passage by assuming that the rich young man was too materialistic, and that the story is a warning to us about that failing. That much may be true, however, that interpretation is about the young man’s reaction, not about Jesus’ words. Jesus instructed him to sell everything he had and give it to the poor. Why? (more…)

Blog author: jballor
Tuesday, October 12, 2010
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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.