We can’t make a perfect economic system. But we can make it better.
God is perfect, we’re not. But that doesn’t stop people from striving for perfection. So how do we design an economic system for an imperfect world? That’s the subject of today’s podcast.
There’s an article in the Wall Street Journal this week by Rachel Feintzeig titled “Try Hard, but Not That Hard.” She writes, “So many of us were raised in the gospel of hard work.” Okay, my first observation is that she called it “the gospel.” It makes a Christian Economist think about the book The Protestant Ethic and the Spirit of Capitalism by Max Weber way back in 1904.
Ms. Feintzeig’s article contains long quotes from Greg McKeown who wrote the book Essentialism: The Disciplined Pursuit of Less. Mr. McKeown suggests we aim at about an 85% success rate. Both of these authors are writing about what economists call “Opportunity Cost.” So, my sophomore students at Dallas Baptist University will study until they know the chapter pretty well, but not perfectly. Why? They know the concept of declining marginal utility, that says that each additional minute spent studying produces less than the previous minute did. So, after a few hours of study, they go play flag football or have pizza with their friends.
Facebook is the classic example of the old phrase from Voltaire, “Perfect is the enemy of good.” It features your friends and their perfect homes, vacations, children, food, etc. It is reminiscent of a guy whom Jesus encountered.
Trying to be Perfect
He was a rich young ruler who wanted to be perfect. Jesus told him, “If you want to be perfect, go, sell your possessions, and give to the poor, and you will have treasure in heaven. Then come, follow me.” In the book The Maker Versus the Takers, Jerry Bowyer explains that Jesus was talking about conversion, not entry into heaven.
We can’t be perfect. The ways we might measure perfection are different than how God measures it. We seek perfection through our accomplishments, wealth, academic degrees, and social status. Jesus tells us to forget seeking perfection, and simply love God, and love your neighbor. It seems strange to me that so many protestants seek perfection, because of two events: Jesus came to save us because He knew we couldn’t perfectly keep the law. And Martin Luther led the Reformation because Luther found he could not keep the Catholic laws. Here’s what Martin Luther had to say about perfection, “We are not what we shall be, but we are growing toward it, the process is not yet finished.” Most Christians call that “sanctification,” meaning, we are becoming closer to perfect, but we can’t gain it on this side of heaven.
We’re Fallen, and we Can’t Get Up. All have sinned and fallen short of the glory of God. The Christian Worldview says that God created a perfect world, fallen humans have messed it up, and it’s our job to redeem it, to the extent we can. We can’t make a perfect world, but we can make this broken world better. That’s our calling. So how do we design an economic system that we know is going to be implemented by fallen people?
There is no perfect economic system. I get so tired of hearing people poke holes in the free-market capitalist system, but then fail to present a better alternative. There isn’t one. Of course, capitalism has its problems, as all human systems do. As Whole Foods founder John Mackey said, “Capitalism is humanity’s greatest invention.” It’s head and shoulders above its nearest competitor, socialism.
The market is so complex, even the greatest economists have not been able to define it. Adam Smith called it “The invisible hand.” That’s not a scientific answer. Invisible?! Friedrich Hayek said it was “spontaneous order.” A freshman at DBU would ask the “first cause” question, which goes something like, “Who spontained it?”
I like the answer from Jay Richards, who in my very subjective opinion, has written the best book on Christian Economics titled Money, Greed & God. He explains the market as, “a stunning example of God’s providence over a fallen world…. It is just what we might expect of a God who, even in a fallen world, can still work all things together for good.” Oh, the subtitle of the book is “Why Capitalism is the Solution and not the Problem.” Free market capitalism is not perfect, because we are East of Eden. We got kicked out of the garden.
I have friends who refused to vote for Donald Trump or Joe Biden. They are seeking perfection, but they’re not going to find it on this side of heaven. Writing in a vote for “Jesus Christ” or “Mickey Mouse,” only shows a voter’s inability to deal with a fallen world. We are fallen, and we can’t get up. So now what do we do? Claim, “A pox on both of your houses?” No, find the best. Alex Haley’s famous credo was “Find the good and praise it.” There’s always something wrong. Welcome to the real world.
Refusing to vote for either of two bad candidates denies the fallen nature. All the candidates are fallen, so find the one who you think will DO the most good, or maybe the least damage!
Saved to Behave
Fortunately, God has offered us grace. We don’t have to be perfect. A colleague often expresses it this way in his prayer, “Thank you for being God, so I don’t have to be.” Whew! What a relief! I don’t have to be perfect. In his book Martin Luther, Eric Metaxas explains the struggle that Martin Luther went through, trying to confess every sin. He wore out his confessor priest. He would confess that he sinned while confessing his sins. He was moving backward: He was committing more sins than he could confess. Finally, it occurred to him “Sola fide, sola scriptura, solus Christus, sola gratia: through Faith alone, by Scripture alone, in Christ alone, by Grace alone!”
Our first-grade grandson felt defeated in his goal for straight A’s because he came home with a paper graded at 99%. His mother explained that there was grace, all the way down to 90%. Whew! That was a close one! I have often given students the lecture titled “You are not your grades.” The summary is: You earn your grades; you are not your grades. You have a life outside your grades, and your salvation is secure, even if you earn all B’s.
It must be so uncertain to believe you would earn salvation through behavior. In my little book Economics and the Christian Worldview, I point out that most religions believe we behave to be saved. But in the Christian worldview, we believe we are saved to behave. It’s important to get the causality in the right direction. If we were constantly trying to behave well enough to be saved, it would drive us crazy. And, it does drive people crazy.
The book The Cure explains it well. The authors explained that we could live in the colony of good intentions (perfection) or the colony defined by grace. The perfection camp is really stressful. The people in the grace camp are much happier.
Learn from Mistakes
Thomas Edison quipped about his difficulty finding the right filament for his new light bulb, “I haven’t failed,” he said, “I’ve just found 10,000 ways that won’t work.” Okay, it was probably more like 3000, but it still makes the point.
Economics is like that. We continually build on previous discoveries. Moses had access to all the raw materials that made up this smartphone, but his predecessors didn’t have the accumulated knowledge about how to put them all together. You do.
And that’s why each successive nadir – that’s the low point, sometimes called the recessionary trough – of the economic cycle is higher than the previous one. We don’t lose technological knowledge along the way. We continue to build on it.
I will close with a summary version of Teddy Roosevelt’s Man in the Arena speech. “The credit belongs to those who are actually in the arena, who strive valiantly; who know the great enthusiasms, the great devotions, and spend themselves in a worthy cause; who at best know the triumph of high achievement; and who, at worst, if they fail, fail while daring greatly, so that their place shall never be with those cold and timid souls who know neither victory nor defeat.”
We can’t make a perfect economic system, but we can make it better.
Tell the Truth
Earn a Profit
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