Faith perspective on the credit crunch
Regular Network Ipswich and Network Norwich columnist James Knight looks at how the Christian view in tough economic times brings things into perspective.
As I’m sure most of you have noticed we are entering a credit crunch that threatens to continue for at least a few years more before it subsides. In a moment I want to look at this from the Christian perspective, but before I do, let me define what has caused this credit crunch. In the simplest terms, banks have been too nervous to lend money where it has been needed most and, consequently, low interest rates have occurred, as well as negative stock market fluctuations, precipitating a general economic malaise. The economic downturn occurred because years of lax lending inflated a huge debt bubble, and after poor investments and fruitless repackaging, huge losses occurred - losses which the banks did not have the capital to cover. A black hole was left in finances, consumerism was hit, and it was up to the government to do something about it – a rescue package for which we the taxpayer will ultimately foot the bill.
Moreover, flawed incentives could go some way to explaining the current situation. It is hard to set incentives, particularly when it is difficult to see who is genuinely doing well and who is experiencing a fortuitous period which could end at any moment. This problem is exacerbated by the fact that the global economic world tends to favour by reward short-term strategies over long-term prudence, which, as we have seen by the behaviour of our bankers, encourages greater risk taking.
A good economy consists of a sound blending of self-interest and outward incentives with a reliable set of regulations that provides a trustworthy and reliable basis for equitability, charity, investment and profit. This was what Scottish economist Adam Smith referred to as the ‘invisible hand’ mechanism, by which each person strives to improve personal finances with their own gain as primacy, but through which they also advance the public good. This principle is also what democracy is based on – the symbiosis of being governed and the individual and collective benefits of such governance.
Having identified a good foundation, one must be mindful in identifying the corollary effect – that is, as soon as the government bases its policy of a given economic indicator (such as the money supply) it ceases to be a reliable guide to the economy. The obvious example of this is that once you try to control one sort of money people will just use others instead. In other words, every time new regulations are introduced to a market, firms respond by sourcing out creative ways to circumvent them. But that is what we must expect in a Smithian system that is spontaneously self-ordered. Compare that with John Maynard Keynes who had a much more optimistic (and many say less realistic) view of the situation – that smart government intervention can raise the bar to deliver an efficacious result when the market economy is not running at maximum efficiency. He is certainly right in the sense that government interventions have been necessary the world over in order to avoid an even more colossal slump – a slump from which it would have been much more difficult to recover.
But recover and survive we will – as human beings we are built for self-regulation and survival maintenance - we can do much more than Karl Marx suggested when he said we could ‘go fishing in the morning, work in a factory in the afternoon, and read Plato in the evening’ (although he was, of course, speaking here about a Communist society, not a Capitalist one).
Where does Christianity fit into the economic picture?
So if we are going to ‘tough it’ through this crisis, how can Christianity help us along the way? Well that largely depends on how one views Christianity, for doubtless those that view Christ as the saviour of the world will likely get through it rather differently to those who see Him as an ordinary man, or those who do not believe Christianity is the truth.
For the Christian, in politics as in everything else, it is the Bible that brings things into focus. Scripture encourages us to recognise the importance of politics without giving it too much power over our thinking – we are not to be overly optimistic or pessimistic about it, and we are not to do anything that compromises what Christ stands for. We are reminded in Romans 13:1-7 that governing authorities have been established by God for our good, therefore given that we are fortunate enough to live in a country in which we have a say in our government, there is responsibility on our part to be wise with our contemplation and decision-making. Underpinning this is a reality of which we should be very proud – all the boasting should be done in His name not ours, therefore as a good ‘putting things into perspective’ exercise, we can seek prudent judgements as we approach the financial and political situations.
Let not the wise boast of their wisdom or the strong boast of their strength or the rich boast of their riches, but let those who boast, boast about this: that they understand and know me, that I am the LORD, who exercises kindness, justice and righteousness on the earth, for in these I delight,” declares the Lord. Jeremiah 9:23-24.
Moreover, a worldview tailored by Biblical principles will help us transcend image, spin, one-upmanship, self-praise, and greed, and will allow the principles and teachings of Jesus to influence how and why we vote and how we spend our money. So we should not vote simply for what will benefit ourselves, but for what will benefit others - politics should always be about identifying and prioritising who needs things the most – after all, concern for the poor and the redistribution of wealth from those with plenty to those in need are principles enshrined in both Old and New Testaments. Furthermore Christ Himself taught that the good life of God is obtained by the one who is prepared to lose his own life (Matthew 16:24-26). I do not mean that capitalism, free enterprise, and rewards for initiative, innovation and success are not good things, particularly with the right government influence through which rules and regulations (health and safety, consumer protection, anti-competitive practices, anti-monopoly regulations, land use control, and taxation for public sector funds, to name but six) are set by the political authorities, but it is equally essential to remember the importance of looking after those who are less well-off and less able than us.
If the credit crunch has taught us one thing about how relevant Christ is in all this, it is with His words ‘For where your treasure is, there your heart will be also.’ – that is, we have been emphatically reminded that people’s implacable greed and their poor sense of priorities regarding their ‘treasure’ and ‘heart’ have been misjudged. The world needs reminding that, like the Colossians, we are first and foremost found in Christ, and that is what lights up and transforms all our other facets of living – we won’t find any ultimate rewards in cupidity and avarice. Despite the tough times, our security is in Jesus, and it is Him we must turn to for help and guidance, not our own selfish judgements.
Moreover, we have all seen that greed and theft incur the opprobrium of the masses as much now as ever before (and given the bankers’ behaviour, quite right too). The eighth commandment ‘don’t steal’ has of course developed into a social ethos of honesty and respect as well as care and generosity, and we see that, much to the surprise of the secular world, there are some worthwhile instructions found in Exodus, Deuteronomy and Leviticus that are still relevant today.
There is a tendency in politics and economics for the chief perpetrators to construct a wall of exoneration and hide behind it away from public view, and in doing so, cast the blame at the feet of the system rather than the individuals. Christianity makes a nonsense of this – sharply and vividly reminding any who dare to dissent that financial markets are not the workings of cold mechanical forces, but of free-thinking human beings.
But theft of course need not mean simply material things. Just as Marx demonstrated that property was not just about land and money; that workers’ labour also had value, so too must we realise that the fruits of our own labour have value, and that through placing our ‘treasure’ in the wrong place or having the wrong priorities – there is a greater theft occurring - it is the Devil stealing away our own soul from where the true treasure lies – in Christ and in Him alone.
Moreover, Christianity has the perfect answer to the mendacity of the political system by reminding us that it is from within, out of the heart, that moral improprieties come (Mark 7:20-23). Blaming the system may be the Biblical equivalent of cleaning ‘the outside of the cup and dish’, but inside remaining ‘full of greed and self-indulgence’ (Matthew 23:25). It is here we see that we as the voting public can observe sin, often in the form of malfeasance or malpractice, and while we can respond and act with our voting voices, it is only Christ that can ultimately put them right – after all, we on the outside of government are hardly blameless, yet we can testify that it is Christ and Christ alone who put us right when we needed it most.
‘This is the covenant I will make with them after that time’, says the Lord. ‘I will put my laws in their hearts, and I will write them on their minds’. Then He adds: ‘Their sins and lawless acts I will remember no more’. Hebrews 10:16-17.
The views carried here are those of the author, not of Network Ipswich, and are intended to stimulate constructive debate between website users. We welcome your thoughts and comments, posted below, upon the ideas expressed here. You can also contact the author direct at email@example.com
James is a Norwich local government officer, author and Proclaimers church member in Norwich. You can access his current collections of columns here
Meanwhile, if you want to find out more about Christianity, visit: www.rejesus.co.u