Thursday, November 6, 2008

Capitalism and the Kingdom of God

During this political season, Barack Obama has been and continues to be branded as a socialist. With that indictment comes the assumption that socialism is in fact evil and capitalism is good. I am personally questioning whether capitalism is actually inherently good. As I see it, capitalism, socialism, and even communism have their strengths.

The problem is humanity. The problem is sin. The problem with each system is that sinful people are involved in the system and so they end up being hurtful to people.
As a Christian, I see things differently then the world. I see the greed, the selfish ambition, and the ignoring of the poor and oppressed that often is evidenced in a capitalistic society. I also see that a system like socialism which is geared more towards community and the common good is often adulterated by corruption, arrogance, and the desire for power by a few.

I believe that we should seek first the kingdom of God and his righteousness/justice.

So why do many Christians treat capitalism as if it is God’s way?

Why is socialism branded as “evil” by many in our society?


hammerdad said...


Socialism is at heart based in atheism. As is libertarianism. I don't know exactly where I fall in the continuum but I do think that capitalism reflects a spirit of entrepreneurialism that is the best economic reflection of the imago dei of any given system.

All systems will reflect both the Imago Dei and depravity but capitalism at its heart (needing adequate governance of checks and balances) places the creativity of the individual to excersize fee capacity for creativity. Socialism and communism have no room for such freedom.

I also don't think that Obama is a lot further toward being a socialist than the republicans who signed off on the bail-out. Further yes, lots further no.

Challenging stuff for sure. Check out Acton Institute, or IVP's Economics in Christian Perspective.

KG said...

Thanks for your thoughts Joel. I'm still learning about these things, but I feel disappointed with the way the dialogue has often gone.

Steve said...

Wow. GREAT points, Joel.


I might add that socialism, and even more so Communism, have a very dismal track record. Not only have they failed to bring the equality they promise, but the governments that instituted them were, with few exceptions (some modern European Socialist governments), have been profoundly oppressive.

Looking at the history of the two philosophies (again, especially Communism), it is difficult to conclude that anything godly was going on. I think that explains the negative association.

Matt said...

Two quick thoughts...

1) I'd like to hear you expand on how libertarianism is based on atheism.

2) I agree that a free market would best allow for individual creativity, but I would add that it also aligns the interests of otherwise selfish people (all of us to some degree). In a TRUE free market profits are the result of providing goods or services that meet the needs/desires of others (note that this is different than the system we have in America where favored corporations are given advantages/subsidies by government).

Steve said...

More random thoughts:

A big weakness of socialism is that it assumes people want to share. Or perhaps mre accurately, that people are naturally altruistic and not inherently sinful.

So it factors out human nature, which is why it's too idealistic and will never really, truly work.

Capitalism is more pragmatic: It acknowledges that people are selfish but can actually leverage that reality in a way that can potentially have benefits for everyone.

Pragmatism isn't necessarily the best, but in a fallen world, I don't know of anything else that can work on a large scale.

hammerdad said...


I think that socialism doesn't suggest people want to share. Instead it presumes that they have no right to ownership from which position they could decide to share (what is rightly theirs to share or not). So in this sense, they MUST share. And of course, in reality this means that those in power control everything and since they are sinful and without accountability it is a recipe for disaster.

Matt, my statement about libertarianism comes from private discussions I've had with Christian economists who lean libertarian.

The point of true libertarianism is economic and political darwinism: let the strong survive. Keep government out of the way entirely (including issues of social morality) except to (a) physically protect the citizens through police and armed forces and (b) enforce contractual obligations (see DeSoto's The Mystery of Capital to understand why).

So no worries about the powerless, the poor, etc..

I've met businessmen who have voiced something similar to this. I was also in a community meeting this weekend in which a guy stood up and asked P. Volpe (head of city of Chicago finances) and our local alderman if the government wouldn't please just pass out checks directly to the people!!!

I think this expression of clear socialism is rare and is unlikely to be common, so to with consistent libertarianism.

Steve said...

Good point, Joel

I guess I had more in mind the "soft" socialism of Western Europe, which tends to be very idealistic and factors out human nature.

You're absolutely right, though, about how it has worked in reality.

I think the fact that socialism HAS to be imposed (as opposed to capitalism, which people will do on their own if given a chance) is probably its most damning weakness.

hammerdad said...

Anthony Bradley is a Christian economist who often speaks publically about these things.. He is often terse in tone but very insightful. . . . Here is a recent comment on a similar question/topic. . . .

quoting AB:
First, this really isn't about the "free market" failing or being victorious in a fallen world. No economic system will ever undue the effects of the fall and the fact that the devil is busy at work seeking to destroy what God has made and declared good is crucial to this discussion. Your empirical evidence of the failure of any economic systems is Genesis chapter 3. Christian socialist tend toward a theology that does not see the devil's working in systems and structures through "God haters," unrealistic visions of government reversing the curses upon creation, tend toward the notion that people are basically good, especially politicians and government employees who will always make the best decisions for the masses, and tend to believe that there are not limitations on policy maker's knowledge and ability to know what to do in the future.

But some economic and political systems, as history has demonstrated, tend toward oppression and others tend toward human flourishing. Some provide the best check on totally depraved people and others allow depravity to rule over the masses. And that's really the question, what creates the context for long-term human flourishing?

Here are some things to read, Pope John Paul II's encyclical "Centesimus Annus" (you can read this on the internet). Economics in Christian Perspective by Victor Claar and Robin Klay, Economics in One Lesson by Henry Hazlitt, Basic Economics by Thomas Sowell, Economic Facts and Fallacies by Thomas Sowell, The Problem of Poverty by Abraham Kuyper, The Ethics of Redistribution, by Bertrand de Jouvenel. And Wayne Grudem's book Business to the Glory of God, That will get you started.

We wouldn't stay up to late too because I'd present you with a bunch of statistical data to explain especially, for example, how Hong Kong's and Swizterland's lack of minimum wage laws creates the lowest unemployment in the world, etc. And I would ask you for data and real economic information and if you didn't have any to discuss we'd just talk about soccer or something. The books will be good though. They all will have empirical and historical data.

KG said...

Good info Joel thanks. I would agree completely that all systems must take into account the sinfulness and depravity of mankind. This a key piece of the puzzle.
I am not too opinionated on economics personally because I am still learning and growing in my knowledge in this area. Thank you for the resources that you have suggested.

I will say that I am definately more of a capitalist at heart. It seems to me that it gets the most production out of a society collectively. It also seems to take into account humanity and the what drives people.

A question that I would have is: Does capitalism leave a greater number of people out of the equation all together? In other words, although the pie is bigger are their more people who get no piece of the pie? I don't know, I am just asking.

If another system actually produces less collectively, but allows all to at least benefit at some level then would that system have some merit.

Again, I am not suggesting that is the case, but simply posing the question.

Thank you all for your imput.

Steve said...

If there is such a sytem, the world has never seen it. At least not that I know of.

I hear Christians sometimes longing, understandably, for something more "fair", and Capitalism does not appear fair.

The oft-cited evidence is the "gap between the rich and poor" in Capitalist economies. So the reaction, in my opinion, is an emotional one that wants to take from those who have all that money and give it to those who do not, so there might be equality.

This is a nice sentiment, but again factors out reality.

In practice, Socialist systems have succeeded only in making most people miserable, while a very small minority enjoys great privilege. And so an even bigger gap between the "haves" and the "have nots".

Another thing to look at is the sources of poverty. Many people who are poor are in their condition not because of being shut out of an unfair economic system, but because of bad choices.

Now don't fear: I'm not going into hyper-Republican mode here or anything. I recognize systemic injustice and the many complex factors that keep many others in poverty. I'm speaking specifically of that segment of the poor that is poor as a consequence of bad choices.

No matter the prevailing economic system, this reality will exist. A socialistic system would only empower such irresponsibility. Simply giving people money is not usually a real solution.

This is one reason why Capitalism has such strengths: It provides an internal motivation to work hard, because it rewards hard work. There is no such reward in socialism.

Finally, Capitalism actually can create wealth. Wealth is not finite. If it was, we would be dealing with the same global amount of wealth now as in any point in history. Imagine that.

Capitalism serves as an engine to create wealth, and thus there is more potential, if Capitalism is managed compassionately, for more people to have an increasing share in an ever-expanding pie.

hammerdad said...

I agree with Steve.

One other important point: the poor in within capitalism don't usually remain poor.

That is, over the lifetime of an individual or family that is below the poverty line, more than 50% will not stay there throughout their lifetime. Some may get out, fall back in, get out again. Some may start above that rate, then due to the bad choice of a business venture (Also called risktaking that doesn't work out) may fall into poverty before rising out again.

The key is that within capitalism most don't STAY in poverty. Within Socialism (I am going to guess here) I bet that's not true.

Steve said...

Man, I love it when we agree, Joel!