And these words, which I command thee this day, shall be upon thy heart. And you shall teach them to your sons and speak of them when you sit in your house, and when you walk on the way, and when you lie down and when you rise up. Deuteronomy 6:7
Train up a child in the way he should go: and when he is old, he will not depart from it. —Proverbs 22:6
I came across this on a Ron Paul Homeschool Website https://fee.org/media/5708/20130707_economicsforboysandgirlscorrectorderleonardread.pdf
While it purports to be an lesson plan to each economics, it is rather a lesson plan on how to teach Christianity. thinly veiled as an economic lesson.
Never-the-less, the lessons are still valid and worth considering.
1. If you drop something, pick it up.
This is easily taught, especially by parents who observe this dictum themselves.
It is training in assuming a responsibility for one’s own actions, that is, of not burdening others with one’s behaviors. Children who take this simple first step in self-control— should the steps continue and become habitual—will likely, when attaining adulthood, look to themselves rather than to the rest of us to bail them out of economic difficulties brought on by their own mistakes. They will, more than likely, not be a burden on society. (I find it interesting here that a Christian view of others is that others are a “burden on society.” Is that how Jesus saw those that for whatever reasons made mistakes, as burdens of society? Just saying. However, I do agree that taking responsibility is an important trait to master.)
A genuine mastery of self-control tends to develop a rare and valuable faculty: the ability to will one’s own actions: Such a person will not be tempted to shift his position by reason of pressures, fickle opinions, popular notions, and the like. He will become his own man.
Picking up what you drop has its reward in orderliness of mind. When it becomes second nature, it is a joyous habit and on occasion leads to picking up after others. Projected into adult life, this shows up as a charitable attitude—in the Judeo-Christian sense—one’s personal duty toward the less fortunate.
2. If you open a door, close it.
This is a sequel to the above; it is merely another practice that confirms the wisdom of completing each of life’s transactions.
3. If you make a promise, keep it.
Social chaos has no better ally than broken promises. Children not brought up to keep their word will be the authors of contracts written not to be observed; they’ll apply for jobs on bogus resumes, use the political connects to benefit themselves over the community; they’ll sell their souls to gain fame or fortune or power.
Not only will they fail to be honest with their fellow men; they will not even heed the dictates of their own conscience. On the other hand, children brought up to keep their promises will not go back on their bond, come hell or high water. Integrity will be their mark of distinction!
4. Whatever you borrow, pay back.
This is an extension of promise keeping. An adherence to these admonitions develops a respect for private property, a major premise in sound economic doctrine. No person, thus brought up, would think of feathering his own nest at the expense of others. Welfare statists and social planners are not born of this training, that is, if the training really sinks in. True, a socialist will honor debts incurred in his own name but will disregard any indebtedness he sponsors in the name of “the public.” He has not been brought up to understand that the principle of compensation applies “across the board.” (These points about “welfare statists,” “social planners,” and “socialists,” are interesting in that they are so pejorative. They also are great examples of how easy it is for Christians to construct a negative narrative of a vague class of people, simply to prop up a Christian narrative.”)
5. Play the thank-you game.
It will take a brilliant parent and a mighty perceptive child to get anywhere with this one. I can set forth the idea but not how to teach it. The idea, once grasped, is simple enough, yet so evasive that, in spite of the 33,000 years since Cro-Magnon man, it was only discovered a bare century ago: The value of a good or service is determined not objectively by cost of production, but subjectively by what others will give in willing exchange. Economic science has no more important concept than this; the free market has no other economic genesis than this subjective or marginal utility theory of value. Indeed, it is most accurately identified as the free market theory of value.
When mother exchanges 30¢ for a can of beans, she values the beans more than the 30¢ and the grocer values the 30¢ more than the beans. If mother valued the 30¢ more than the beans, she wouldn’t trade. If the grocer valued his beans more than the 30¢, he wouldn’t trade. The value of both the 30¢ and the beans (excluding other considerations) is determined by the two subjective judgments. The amount of effort exerted (cost) to obtain the 30¢ or to acquire the beans has nothing to do with the value of either the beans or the 30¢.
I repeat, the value of any good or service is determined by what it will bring in willing, not forcible or unwilling exchange. (TVA, Post Office, and a thousand and one other deficits, are paid or by forcible exchange. Moon specialists are paid by forcible, not willing, exchange. This goes, also, for all governmental subsidies.) (This addition of “government forcibly taking” is an interesting perspective here. I understand why it is for Rand Paul, but why is this a Christian value? This is important and needs a lot more discussion.)
This concept of value, be it remembered, was practiced off and on by the common man ages before economic theorists identified it as the efficacious way of mutually advancing economic well-being. And, by the same token, children can be taught to practice it before they can possibly grasp the theory. In exchanging toys or marbles or jacks or whatever with another, they should play the thank-you game? They can be taught to express the same “thank you” themselves as they expect from their playmate? That both have gained when each says, “Thank you”? Accomplish this with a boy or girl and you have laid the groundwork for sound economic thinking.
6. Do nothing to a playmate you wouldn’t enjoy having him do to you.
Moral philosophy is the investigation into and the study of what’s right and wrong. Economics is a division of this discipline: the study of right and wrong in economic affairs.
The free market is the Golden Rule in its economic application, thus free market economics is dependent on the practice of the Golden Rule.
That the Golden Rule can be phrased and taught so as to be completely perceived prior to adolescence is doubtful. Its apprehension requires a moral nature, a faculty rarely acquired earlier than teen-age—in many instances, never!
But the effort to teach the Golden Rule to boys and girls will, at a minimum, result in a better observation of it on the parent’s part. Children—highly impressionable—are far more guided by parental conduct than by parental admonishments. Thus, the attempt to teach this fundamental principle of morality and justice, resulting in highly exemplary behavior, may lead the child first to imitation and then to habitual observance and practice.
Why is economics so daunting for people to approach?
In a previous post addressing this question, I discussed the problem with modern economics and why it seems so confusing. In another post, I examined this problem in depth, looking at how people have become alienated from economics.
Today, I want to share with you five tips that have helped me begin to approach economics from a Christian perspective.
1. Start with creation.
Before tackling the complexity of humanity and economic markets, start with the One who created it all.
Genesis 2:15 introduces a central theme in economics: work.
The Lord God took the man and put him in the Garden of Eden to work it and take care of it.
God gave Adam a job before sin entered the world. Work is not a result of sin, it is a dignifying gift from God.
If God has called all of us to be salt and light in the world through our work, then the economic environment we work in is necessarily connected to human flourishing and our vocational callings.
2. Forget the math.
Since Forbes probably won’t ask you to project next quarter’s GDP growth adjusted for inflation, you can rest easy, leaving the math equations to the economic forecasters. Mathematical data can be very helpful in economic analysis, but you don’t need to be a math whiz to understand economics.
Think of economics in simple terms: it’s just the study of human decision-making. As Simple English Wikipedia puts it, economics is,
The study of how people make choices to get what they want, when they cannot get everything they want.
Economics is a useful tool in practicing stewardship over scarce resources, both tangible (such as money) or intangible (time, for instance).
3. Educate yourself.
Now that you know economics isn’t as complicated as you may have thought it was, you’re ready to tackle some light economic reading.
A great introductory economics text is a short essay by Leonard Read called, I, Pencil. Read writes from the point of view of a pencil describing the complexity of its own creation. This illustration will help you understand the vast knowledge, skills, and numerous people involved in producing even the simplest of goods. Read the full essay over at the Library of Economics and Liberty. It might also help to watch IFWE’s video, I, Smartphone, an updated take on Read’s classic essay.
For a more comprehensive introduction to economics, I recommend reading Economics in One Lesson by Henry Hazlitt. This book is a simple, coherent, and fun read. Hazlitt explains economic principles and myths using real-life illustrations. It’s perfect for anyone interested in economics, with or without any previous understanding. The full book is available online from the Foundation for Economic Education.
4. Connect faith with economics.
How does my biblical worldview connect to economics?
Though economics might sound like it has little to do with Christianity, we cannot disconnect any secular study from our faith.
For example, take a biblical principle and ask yourself how this might apply to economics. James Otteson, professor of Philosophy and Economics at Yeshiva University, explains how he connects his faith with economics in this short clip on God-given human dignity as it relates to economics:
This type of intellectual integration will not only help you better understand economics, but it might even help you to better understand your faith as you begin to connect the dots between the two.
5. Avoid false economic gods.
As you immerse yourself deeper into economic principles and schools of thought, you might notice economic “savior” figures emerging. The two most common are “government as savior” and “individual liberty as savior.”
Nobel Prize-winning economist James Buchanan explains these economic gods in his paper, Afraid to be Free: Dependency as Desideratum.
According to Buchanan, the “government as savior view” can derive from Keynesian economic thought as expressed when
citizens may genuinely want to extend the parental role of the welfare state, to allow the state to replace God.
The “individual liberty as savior” can result from classical liberalism by suggesting liberty is an end in itself. As Buchanan puts it, classical liberalism potentially
demonstrates that persons can stand alone, that they need neither God nor the state to serve as surrogate parents.
Developing a faithful Christian response to economics involves understanding how to properly connect our faith with a biblical definition of work and sound economic principles, keeping in mind it is neither the government nor the free market that saves, but Christ alone.
Editor’s note: Learn basic principles of economics from a biblical perspective in Biblical Foundations for the Economic Way of Thinking, a high school homeschool elective course.
Join us! Help empower Christians to transform the world through their work. Support IFWE today.
On “Flashback Friday,” we take a look at some of IFWE’s former posts that are worth revisiting. This article was previously published on Sept. 21, 2012.
Toward a Christian View of Economics
Regrettably, many American Christians know little about economics. Furthermore, many Christians assume that the Bible has nothing at all to say about economics. But a biblical worldview actually has a great deal to teach us on economic matters. The meaning of work, the value of labor, and other economic issues are all part of the biblical worldview. Christians must allow the economic principles found in Scripture to shape our thinking. Here, then, are twelve theses for what a Christian understanding of economics must do.
1. It must have God’s glory as its greatest aim.
For Christians, all economic theory begins with an aim to glorify God (1 Cor. 10:31). We have a transcendent economic authority.
2. It must respect human dignity.
No matter the belief system, those who work show God’s glory whether they know it or not. People may believe they are working for their own reasons, but they are actually working out of an impulse that was put into their hearts by the Creator for His glory.
3. It must respect private property and ownership.
Some economic systems treat the idea of private property as a problem. But Scripture never considers private property as a problem to be solved. Scripture’s view of private property implies that owning private property is the reward of someone’s labor and dominion. The eighth and tenth commandments teach us that we have no right to violate the financial rewards of the diligent.
4. It must take into full account the power of sin.
Taking the Bible’s teaching on the pervasive effects of sin into full account means that we expect bad things to happen in every economic system. A Christian economic understanding tries to ameliorate the effects of sin.
5. It must uphold and reward righteousness.
Every economic and government system comes with embedded incentives. An example of this is the American tax code, which incentivizes desired economic behaviors. Whether they work is an issue of endless political recalibration. However, in the Christian worldview, that recalibration must continue to uphold and reward righteousness.
6. It must reward initiative, industry, and investment.
Initiative, industry, and investment are three crucial words for the Christian’s economic and theological vocabulary. Initiative goes beyond action. It is the kind of action that makes a difference. Industry is human work done corporately. Investment is part of the respect for private property found in Scripture. Investment, as it turns out, is as old as the garden of Eden. That which accrues value is honorable, and the impulse to accrue that value is honorable. Thus, a Christian economic theory indicts any able-bodied person who won’t work and anyone who won’t respect private property or reward investment.
7. It must seek to reward and incentivize thrift.
In a fallen world, money and investments can quickly be distorted to idolatrous ends. For that reason, thrift is a very important issue in the Christian worldview. In a fallen world, abundance one day can turn into scarcity the next. Thrift may be what provides survival in times of poverty.
8. It must uphold the family as the most basic economic unit.
When thinking about economic theory embedded in the beginning of the Bible, the dominion mandate is central, but so is the divine institution of marriage. The pattern of leaving and cleaving described in Genesis 2 is fundamental to our economic understanding. Adam and Eve were the first economic unit. The result is that the family, biblically defined, is the most basic and essential unit of the economy.
9. It must respect community.
Most secular thinkers and economists begin with the community and then move to the family. However, thinking from larger to smaller economic units not only does not work in theory, it also fails in practice. Beginning with the family unit and then working out toward the community is a much smarter option. The doctrine of subsidiarity—which emerged out of natural law theory—teaches that meaning, truth, and authority reside in the smallest meaningful unit possible. If the family unit is deficient, no government can meet the need of its citizens. When the family is strong, government can be small.
When the family is weak, however, the government must compensate for the loss. By focusing on the family, we respect and better the community.
10. It must reward generosity and proper stewardship.
Christians who are committed to the economics of the kingdom and to the good of the next generation must live with a future-oriented financial perspective. We each have the responsibility, whether we own a lot or a little, to see that our generosity endures far beyond our lifespan. Spirited generosity, which is so clear in Scripture, is essential to a Christian economic worldview.
11. It must respect the priority of the church and its mission.
Christians must embrace economic priorities that the rest of the world simply will not understand. Christians must invest in churches, seminaries, and international missions. These are distinctive Christian nancial commitments. Our ultimate financial commitment is not to ourselves or to our own investments but to the kingdom of Christ. Thus, Christians should always be ready to experience upheaval in economic priorities and arrangements because urgent kingdom issues can intervene at any moment.
12. It must focus on eschatological judgment and eschatological promise.
This life and its resources cannot deliver ultimate joy. The Christian worldview reminds us that we must live with the recognition that we will give an account to the Lord for our stewardship of our resources. At the same time, Christians must look to the eschatological promise of the new heavens and earth as our ultimate economic hope. We must lay up treasures in heaven and not on earth.
A Biblical View of Economics
In this article we are going to be developing a Christian view of economics. Although most of us do not think of economics in moral terms, there has (until the last century) always been a strong connection between economics and Christian thought.
If you look at the Summa Theologica of Thomas Aquinas, you find whole sections of his theological work devoted to economic issues. He asked such questions as: “What is a just price?” or “How should we deal with poverty?”
Today, these questions, if they are even discussed at all, would be discussed in a class on economic theory. But in his time, these were theological questions that were a critical and integral part of the educational curricula.
In the Protestant Reformation, we find the same thing. In John Calvin’s Institutes of the Christian Religion, whole sections are devoted to government and economics. So Christians should not feel that economics is outside the domain of Christian thinking. If anything, we need to recapture this arena and bring a strong biblical message to it.
In reality, the Bible speaks to economic issues more than any other issue. Whole sections of the book of Proverbs and many of the parables of Jesus deal with economic matters. They tell us what our attitude should be toward wealth and how a Christian should handle his or her finances. The Bible also provides a description of human nature, which helps us evaluate the possible success of an economic system in society.
The Bible teaches that there are two aspects to human nature. First, we are created in the image of God and thus able to control the economic system. But second, human beings are sinful and thus tend towards greed and exploitation. This points to the need to protect individuals from human sinfulness in the economic system. So Christians have a much more balanced view of economics and can therefore construct economic theories and analyze existing economic systems.
Christians should see the fallacy of such utopian economic theories because they fail to take seriously human sinfulness. Instead of changing people from the inside out as the gospel does, Marxists believe that people will be changed from the outside in. Change the economic base, they say, and you will change human beings. This is one of the reasons that Marxism was doomed to failure, because it did not take into account human sinfulness and our need for spiritual redemption.
It is important for Christians to think about the economic arena. It is a place where much of everyday life takes place, and we can evaluate economics from a biblical perspective. When we use the Bible as our framework, we can begin to construct a government and an economy that liberates human potentiality and limits human sinfulness.
Many Christians are surprised to find out how much the Bible says about economic issues. And one of the most important aspects of the biblical teaching is not the specific economic matters it explores, but the more general description of human nature.
Economics and Human Nature
When we are looking at either theories of government or theories of economics, an important starting point is our view of human nature. This helps us analyze these theories and predict their possible success in society. Therefore, we must go to the Scriptures to evaluate the very foundation of each economic theory.
First, the Bible says that human beings are created in the image of God. This implies that we have rationality and responsibility. Because we have rationality and volition, we can choose between various competing products and services. Furthermore, we can function within a market system in which people can exercise their power of choice. We are not like the animals that are governed by instinct. We are governed by rationality and can make meaningful choices within a market system.
We can also assume that private property can exist within this system because of the biblical idea of dominion. In Genesis 1:28, God says we are to subdue the earth and have dominion over the creation. Certainly one aspect of this is that humans can own property in which they can exercise their dominion.
Since we have both volition and private property rights, we can then assume that we should have the freedom to exchange these private property rights in a free market where goods and services can be exchanged.
The second part of human nature is also important. The Bible describes the fall of the world and the fall of mankind. We are fallen creatures with a sin nature. This sinfulness manifests itself in selfishness, greed, and exploitation. Thus, we need some protection in an economic system from the sinful effects of human interaction.
Since the Bible teaches about the effects of sinful behavior on the world, we should be concerned about any system that would concentrate economic power and thereby unleash the ravages of sinful behavior on the society. Christians, therefore, should reject state-controlled or centrally controlled economies, which would concentrate power in the hands of a few sinful individuals. Instead, we should support an economic system that would disperse that power and protect us from greed and exploitation.
Finally, we should also recognize that not only is human nature fallen, but the world is fallen. The world has become a place of decay and scarcity. In a fallen world, we have to be good managers of the limited resources that can be made available in a market economy. God has given us dominion over His creation, and we must be good stewards of the resources at our disposal.
The free enterprise system has provided the greatest amount of freedom and the most effective economic gains of any economic system ever devised. Nevertheless, Christians often wonder if they can support capitalism. So the rest of this article, we are going to take a closer look at the free enterprise system.
Capitalism had its beginning with the publication of The Wealth of Nations, written by Adam Smith in 1776. He argued that the mercantile economic system working at that time in Great Britain was not the best economic foundation. Instead, he argued that the wealth of nations could be increased by allowing the individual to seek his own self-interest and by removing governmental control over the economy.
His theory rested on three major premises. First, his system was based upon the observation that people are motivated by self-interest. He said, “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.” Smith went on to say that “neither intends to promote the public interest,” yet each is “led by an invisible hand to promote an end that was not part of [his] intention.”
A second premise of Adam Smith was the acceptance of private property. Property was not to be held in common but owned and freely traded in a market system. Profits generated from the use and exchange of private property rights provided incentive and became the mechanism that drives the capitalist system.
From a Christian perspective we can see that the basis of private property rests in our being created in God’s image. We can make choices over property that we can exchange in a market system. The need for private property grows out of our sinfulness. Our sinful nature produces laziness, neglect, and slothfulness. Economic justice can best be achieved if each person is accountable for his own productivity.
A third premise of Adam Smith’s theory was the minimization of the role of government. Borrowing a phrase from the French physiocrats, he called this laissez-faire. Smith argued that we should decrease the role of government and increase the role of a free market.
Historically, capitalism has had a number of advantages. It has liberated economic potential. It has also provided the foundation for a great deal of political and economic freedom. When government is not controlling markets, then there is economic freedom to be involved in a whole array of entrepreneurial activities.
Capitalism has also led to a great deal of political freedom, because once you limit the role of government in economics, you limit the scope of government in other areas. It is no accident that most of the countries with the greatest political freedom usually have a great deal of economic freedom.
At the outset, let me say that Christians cannot and should not endorse every aspect of capitalism. For example, many proponents of capitalism hold a view known as utilitarianism, which is opposed to the notion of biblical absolutes. Certainly we must reject this philosophy. But here I would like to provide an economic critique.
Capitalism: Economic Criticisms
The first economic criticism is that capitalism leads to monopolies. These develop for two reasons: too little government and too much government. Monopolies have occurred in the past because government has not been willing to exercise its God-given authority. Government finally stepped in and broke up the big trusts that were not allowing the free enterprise system to function correctly.
But in recent decades, the reason for monopolies has often been too much government. Many of the largest monopolies today are government sanctioned or sponsored monopolies that prevent true competition from taking place. The solution is for government to allow a freer market where competition can take place.
Let me add that many people often call markets with limited competition monopolies when the term is not appropriate. For example, the three major U.S. car companies may seem like a monopoly or oligopoly until you realize that in the market of consumer durables the true market is the entire western world.
The second criticism of capitalism is that it leads to pollution. In a capitalistic system, pollutants are considered externalities. The producer will incur costs that are external to the firm so often there is no incentive to clean up the pollution. Instead, it is dumped into areas held in common such as the air or water.
The solution in this case is governmental intervention. But I don’t believe that this should be a justification for building a massive bureaucracy. We need to find creative ways to direct self-interest so that people work towards the common good.
For example, most communities use the water supply from a river and dump treated waste back into the water to flow downstream. Often there is a tendency to cut corners and leave the waste treatment problem for those downstream. But if you required that the water intake pipe be downstream and the waste pipe be upstream you could insure less pollution problems. It is now in the self-interest of the community to clean the wastewater being pumped back into the river. So while there is a need for governmental action, much less might be needed if we think of creative ways to constrain self-interest and make it work for the common good.
We can acknowledge that although there are some valid economic criticisms of capitalism, these can be controlled by limited governmental control. And when capitalism is wisely controlled, it generates significant economic prosperity and economic freedom for its citizens. Next, let us discuss some of the moral problems of capitalism.
Capitalism: Moral Critiques
One of the first moral arguments against capitalism involves the issue of greed. And this is why many Christians feel ambivalent towards the free enterprise system. After all, some critics of capitalism contend that this economic system makes people greedy.
To answer this question we need to resolve the following question. Does capitalism make people greedy or do we already have greedy people who use the economic freedom of the capitalistic system to achieve their ends? In light of the biblical description of human nature, the latter seems more likely.
Because people are sinful and selfish, some are going to use the capitalist system to feed their greed. But that is not so much a criticism of capitalism as it is a realization of the human condition. The goal of capitalism is not to change people but to protect us from human sinfulness.
Capitalism is a system in which bad people can do the least harm, and good people have the freedom to do good works. Capitalism works well if you have completely moral individuals. But it also functions adequately when you have selfish and greedy people.
Important to this discussion is the realization that there is a difference between self-interest and selfishness. All people have self-interest and that can operate in ways that are not selfish. For example, it is in my self-interest to get a job and earn an income so that I can support my family. I can do that in ways that are not selfish.
Adam Smith recognized that every one of us have self-interest and rather than trying to change that, he made self-interest the motor of the capitalist system. And before you react to that, consider the fact that even the gospel appeals to our self-interest. It is in our self-interest to accept Jesus Christ as our savior so that our eternal destiny will be assured.
By contrast, other economic systems like socialism ignore the biblical definitions of human nature. Thus, they allow economic power to be centralized and concentrate power in the hands of a few greedy people. Those who complain of the influence major corporations have on our lives should consider the socialist alternative of how a few governmental bureaucrats control every aspect of their lives.
Greed certainly occurs in the capitalist system. But it does not surface just in this economic system. It is part of our sinfulness. The solution is not to change the economic system, but to change human nature with the gospel of Jesus Christ.
In conclusion, we may readily acknowledge that capitalism has its flaws as an economic system, but it can be controlled to give us a great deal of economic prosperity and economic freedom.
© 2001 Probe Ministries International