The economy continues to spiral downward, as both our citizens and the nations of the world await economic remedies that have a strong chance of success. As the government unfolds its “solutions,” the crisis described as the “perfect economic storm” will neither simply go away, nor will it transcend the long shadow of partisan politics. While both the “left” and the “right” have elements of economic wisdom within their agendas, neither has the ability to see the ultimate reality: debt-based, consumption-driven, rights-entitling Keynesian economics is on the verge of either collapse or massive adjustments.
In either case, it is a time of historic opportunity. A door is now open for the injection of biblically-based economic principles to engage the drama and the global dialog which is straining to discover sustainable economic growth, stability, and social justice. Can free market-economics deliver such a system? How do we begin to unravel the current economic “freeze” of both capital and confidence? What follows is an attempt to summarily answer these two questions from the perspective of a political-economist committed to the scripture’s view of these issues. Those answers must come to some degree from “outside” the current political system for the current crisis once again reaffirms Einstein’s observation that, “the level of thinking that created the problem is insufficient to resolve it.”
What is clear is the pressing need for an alternative economic system “for the common good.” From a “fifty thousand foot-level,” I will attempt to explain how a biblical view of economic principles and dynamics allows us to see from another perspective the current financial crisis. For many years I have passionately pursued political-economics and its relationship to the scripture. The subject itself is complex and requires a studied background in the secular disciplines surrounding both economic theory and political philosophy. It also requires an ability to contrast them with the biblical principles which speak to the same sets of ideas. However, simply stated, both the successes and failures experienced by Western culture politically and economically are easily traceable to their historical application, or disregard, of the biblical concepts undergirding both economic and political social structures.
What follows is a measured attempt to overview the current financial crisis without dropping down deeply into the “gears” of what will be required to both legislatively and politically fix the current crisis. Make no mistake; this crisis is systemic, possibly catastrophic. It harkens back to the 1930’s and the social-spiritual tragedy of the absence of biblically-trained and effective economists present then to refute the economic theories of John Maynard Keynes. His creation of the current debt-based economic system has finally reached its inevitable “crash,” which was widely predicted years ago. Ideas surely have consequences.
The Challenge We Face and What Must Be Communicated
Christianity’s failure to “disciple the nations” continues to become painfully obvious. We have been increasingly marginalized, largely left out of the debates surrounding the issues of the world, except abortion and sexually-related choices. Nowhere is our absence more evident than in the field of “economics.” “Economics” actually represents God’s love for and value of labor itself. God reveals Himself first as a creative worker. Properly seen, unimpaired by religious neo-Platonism, economics is truly the “engine of dominion.” It has driven all cultures from the very beginning. Everything that man adds to his God-given environment comes through labor, and “dominion” is the collective result of the values and goals that drive that labor. Now that the secular economic crisis is upon us, Christians have the opportunity of a millennium to at last engage in the economic conversation that drives every global election and the destiny of the nations. Our absence from this conversation has caused untold damage to the people of the world.
Economics is the mirror reflection of the values played out in virtually every sphere of culture. We have the opportunity to get into the “public conversation” if we will but see that opportunity, prepare for it, and seize it. Abortion, for example, was framed by our surrounding culture as a “moral issue” of simple, personal choice. Now, however, it is as if God has said, “OK, I’ll let you see the economic implications of the lost tax revenues from 50 to 60 million aborted wage earners, as well as the demographic impossibility of leveraging your massive baby-boomers retirement with too few younger workers to do so.”
“Economics” reflects and reveals the “real-world” effects of the moral choices of human beings. For example, the scriptures teach that poverty is both a personal and social set of moral failures above all else. “Morality” or character carries current world consequences, not just “heavenly issues.” The door to this level of thinking is now opening to these kinds of moral-economic connections. May we vigorously and wisely press through that door which God has sovereignly opened to us through this current crisis.
What is “Economics” Really All About?
Economics is ultimately about the personal and collective faith of the people in their social system. The metrics and graphs simply deal with the results and projections surrounding the results of that faith and the choices coming from it. “Faith,” in this context, simply means people’s willingness to invest their time, energy, and resources in strategic labor and trade, expecting a reasonable reward from those investments. It really is that simple.
A viable economic system is one that appreciates and plays by God’s biblically revealed rules. Such a system is undergirded by three very basic axiomatic principles. Here they are:
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Justice comes from the fairness and reliability of the legal and economic system in which people function, as reflected in prudent regulation and just rewards, for the consequences of all its citizen’s actions.
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A culture’s collective values produce economic results. Among them are:
a. Empowerment: a legitimate reward for functioning skill-sets. b. Solvency: a recognition that financial stewardship and restraint (solvency) has greater value than “getting what we want now,” regardless of the consequences. c. Stewardship: a recognition that taking care of what one already has is the best stepping stone to upgrading life-style. -
Taxation policy should give all citizens “equal buy-in,” regardless of economic status. This requires the removal of all insider tax-avoidance provisions. It should also promote:
a. Employment Incentives - Tax credits for the employment and training of new employees. b. Capital Creation vs. Consumption Materialism - The focus on the economic stimulation of the private sector where competition stimulates and the system rewards efficiency and productivity, thus making funds available for capital creation vs. mere consumption. Governmental spending usually only creates multiplier-effect consumption rather than capital investment results. c. Parenting Incentives - A price-wage equilibrium providing a “living wage” that supports strong family units where respect, cooperation, teamwork, and loyalty are powerfully injected into the culture without the necessity of both parents needing to work in order to survive in an inflation-driven system. d. Rewarding what truly serves - The normal capital stimulation policies of accelerated depreciation, investment credits, and low or no taxes on capital gains.
The current bail-out policies are likely doomed to failure because the core issues of the current Keynesian system are not being addressed. Among the most critical issues are: the limited and regulated use of financial leverage in all institutions and transactions; the reconnection of currency to tangible assets; the setting of mandatory retirement of all government debt; the reduction of usurious interest rates by credit card services; and perhaps specifically in this crisis, the purchasing by the government of all “toxic assets” in the lending industry so as to re-stimulate the flow of currencies between banks without their fear of never seeing that currency repaid.
I am advocating a biblical foundation of honest money, increase through the creation of tangible products and services, and the limitation of financial advantage by the powerful. I am also advocating identical standards of ethics, prudence, and accountability for all governmental economic policy as for the private sector.
The Road to Recovery: Four Steps to Revive the Economy (A Call to a National Debate)
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We as a nation must recognize that spending the “government’s money” is spending the citizens’ money. We the people will have to pay it back, either through a healthy economy which repays the debt, or through the bankruptcy of the nation and massive social chaos.
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We as a nation must recognize that this financial crisis is an opportunity to fix things that were connected to moral failures and social injustices within our nation. We must clearly identify them, and repent of them by renouncing their future possibility through legislative regulation, educational focus, and the full cooperation of both the private and public sectors.
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We as a nation must recognize that our monetary and fiscal policy must first focus on rebuilding the people’s trust in the economy, not advancing social policies that cannot be sustained without a strong economic base undergirding them. This is no time for mere political agendas which cannot be paid for and further enslave the American people with more debt.
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We as a nation must recognize that government spending has no incentives in it to create efficiency or profit, and therefore it does not directly create capital for the creation of new jobs or industries. Long term economic growth is only possible where constant government investments are not required to keep them going. Government spending must be a stimulus to the economy, not an attempt to be its foundation. Stipulations of accountability to those receiving governmental funds in the private sector must now become equally applicable to governmental spending and accountability. Government waste in spending is every bit as immoral as greed and manipulation in the private sector.
Six Specific Policy Decisions
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Restore our nation’s financial institutions by first standardizing the accounting systems and asset evaluations so as to create honest and real balance sheets. Make any “games” punishable by jail time for all parties involved.
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A nation’s homes have a “core” social-economic value to its citizens. Many of our nation’s 130 million homeowners have a massive stake in this current crisis. The direct consequences of both loan defaults, and the plus or minus fifteen percent reduction in market values, add up to a staggering multiple trillion dollar value loss. This loss is at the very heart of the crisis, and has spread seriously into the tragic financial market losses of retirement funds in particular. In order to salvage whatever is salvageable, the banks should re-negotiate these endangered default loans to a minimal interest level, and thus stabilize tens of thousands of homeowners’ lives. What remains in default should be purchased for re-sale by the government at current market prices and re-sold at interest levels which do not further undermine the housing values crisis. This removal of these “toxic assets” will have a major positive effect on the currency velocity in financial institutions.
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Invest at least one-third of all remaining government investments in “safety-net” programs for the unemployed, uninsured, and truly needy.
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Invest two-thirds of that remainder in infrastructure spending, job training programs, small business loans, and education.
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Immediately change our tax laws so as to reward honesty, savings, investment, and job creation. Use multiple approach taxation reduction policies for business hiring and training programs, accelerated depreciation policies, and investment tax credits. Within our taxation policy overhauls, we should also move to enact:
a. A three-year transition to a uniform flat tax of 10% for all individuals and companies. The removal of “tax games” will end the non-productive and absurd tax avoidance gyrations of the insider-wealthy class, while releasing unprecedented capital investment into the private sector. b. Short-term government loans at minimal interest to qualified small businesses. -
Lastly, and with unswerving commitment, we must, as a nation, focus on developing long-term policies and commitments to national economic independence in key industries and support systems. These strategies must be bi-partisan and transcend the election process as “core commitments” of the nation. All administrations must follow them as “core policies” and invest mandated percentages of national budget spending for them.
It is my hope that this proposal will help stimulate a national debate and contribute to the immediate engagement of all interested parties. The net process must reach the media, the political parties, and the soul of the nation. Our national survival and our responsibility to both future generations and to the other nations of the earth are now on the line.
For more information on the author, Dennis Peacocke, go to: http://www.gostrategic.org/
Bruce Krueger
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... Very interesting and informative. But how does someone who is not in politics or the financial/economic world even start to influence the right people? |
Susie Keithley
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... I e-mailed a link to this page to my senator. with a note that said it expressed my opinion better than I could. |
Sherri Jackson
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... a great idea to send to elected offiical! I will proceed. A great atricle.May this get into the hands of people who are starving for answers! |
Joel Petersen
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HELLO ! ! ! Shouting into the wind is not going to change the economic systems of this country or the world. The economic "POWERS" that control the money systems have to be infiltrated and taken over by Kingdom Eonomists, Bankers, etc. So where are our universities , colleges, etc. that are putting out graduates in these fields to rebuild these "governmental systems' ? Where are the educators to train these people? Why are'nt the Kingdom Ministries, Kingdom Church Organizations, coming together and working as a unit to start establishing recognized training institutions ? The secular education movement has ground us into the dirt. Have we been to busy building our own little kingdoms within the overall "Kingdom Movement"?? Stay tuned, lets engage. |
