Over the next week we’ll be running pieces multiple pieces on political economics. The chief question we are addressing is “What duties a Christian magistrate has to the poor?” In today’s post, Dylan Pahman of the Acton Institute is giving a classical liberal answer to that question. Tomorrow we will be running a response to the same question written by a Christian socialist.
is fashioned by the spiritual heritage of classical and Christian tradition. I see in man the likeness of God; I am profoundly convinced that it is an appalling sin to reduce man to a means … and that each man’s soul is something unique, irreplaceable, priceless, in comparison with which all other things are as naught.
This conviction animated his support for classical liberalism and free market economics. And so it does for me. Thus, I believe the duty of the Christian statesman (or stateswoman) to the poor requires defending human rights, supplying urgent needs, reducing barriers to market entry, and guaranteeing access to the institutions of justice, seeking realistic, gradual reform as possible and prudent.
Jesus inaugurated his teaching ministry by declaring it the fulfillment of the prophecy of Isaiah to “preach the gospel to the poor” (Luke 4:18-19; cf. Isaiah 61:1-2). That, first of all, means all of us. Corrupted by sin and death, we are prone to error and temptation and helpless to save ourselves. Through his incarnation, life, death, and resurrection, Jesus Christ liberates us from the poverty of separation from God, slavery to sin, and domination by death. Thus, we ought to be skeptical of our own capabilities but hopeful about what we can accomplish through God’s grace.
Second of all, however, it is clear that Jesus also gave special care to the materially poor and socially marginalized, wanted his disciples to do the same, and warned against the spiritual danger of riches. He did not teach that wealth is inherently evil, but as wealth grants us greater opportunities, it also opens us to greater temptation. As Acton put it, “power tends to corrupt.” This applies to any power, whether political, economic, social, or spiritual.
The early Church fathers emphasized that generosity from the rich would help alleviate poverty. In turn, the poor would pray for the rich and thus both would serve each other. This is good and still true but also dated. In our own time, developed societies like the United States have escaped the Malthusian trap—our economies are not zero-sum affairs. One person’s wealth does not necessarily mean another’s poverty. In the last 200 years, we have become exceptionally good at creating new wealth. This has been a boon to the poor, but it has also presented new opportunities for corruption.
The state’s raison d’être is to ensure justice in society. Social justice renders to each person, community, and sphere of society its due. On a national level, laws should be concerned with protecting the rights and freedoms due to all people, rich and poor alike, by virtue of their human nature. On a more local level, particular contexts must be given their due, since each person is unique and society is inherently diverse. For example, minimum wages (if they should exist at all) should be limited to the most local government bodies. When it comes to the problem of poverty, national governments must avoid one-size-fits-all, top-down social engineering.
Due to the demands of justice and our propensity to sin, higher levels of government must only become involved when local governments seek their help, in accordance with the principle of subsidiarity. Furthermore, states must not violate the sovereignty of institutions and private providers of social services, such as families, religious bodies, businesses, and charities, following the principle of sphere sovereignty. In this way, the state practices its own asceticism, becoming stronger through its own self-denial and making room, i.e. freedom, for other communities. This importantly includes religious liberty, so that the Gospel can be freely spread and grace received and dispersed throughout society like leaven in a lump of dough (Matthew 13:33). This affirmation of limited government for the sake of liberty is the basis of classical liberalism.
When it comes to poverty today, however, the most important thing is not aid but opportunity. The source of poverty is the lack of jobs profitable enough to provide for the needs of oneself and one’s dependents. We are all made to work (Genesis 2:15-16), so this privation is not just material but also spiritual. It is an affront to people’s dignity when there isn’t sufficient work available to meet families’ needs. Public social safety nets are essential emergency measures, but they produce no new wealth. They only redistribute the wealth already in an economy (a zero-sum game). They should not be regarded as good enough for the Gospel to the poor.
Jobs are what the poor need, and jobs are created by businesses. People settle for bad jobs only when good ones aren’t available. Thus, eliminating barriers to market entry ought to be of primary concern to the Christian statesman, combatting the unjust inequality created by closed markets. Barriers to entry include onerous occupational licensing and patent laws, high corporate taxes, zoning laws, overregulation, and subsidies. These things close markets to new competitors because, even though it might seem against their interest (except for subsidies), large, established firms are more likely to benefit from them and lobby for them (which is called rent seeking). They can afford higher taxes and the compliance costs of complex regulation. Newcomers often can’t. Furthermore, due to occupational licensing, patent trolling, and zoning, would-be entrepreneurs often need the state’s permission just to try to compete in the first place, requiring more fees and months, even years, of waiting—time and resources that many do not have. Subsidies, lastly, distort markets in favor of established firms and economies in favor of established markets, inefficiently diverting the resources of society to them. Such barriers obstruct people’s ability to create new wealth for the common good and fulfill the divine mandate to “be fruitful” (Genesis 1:28) according to the likeness of God.
In free markets, properly understood, these barriers are kept to a minimum, increasing competition and wealth creation. The more businesses there are looking for workers, the more demand there is for labor. Thus, not only will there be more jobs, but wages will be higher as well. It should be no surprise that the decline in American entrepreneurship has coincided with wage stagnation. Beyond wages, an additional benefit of increased competition is that it also drives down the price of consumer goods, thus lowering the cost of living for everyone as well. Free markets help the poor—and everyone else—in terms of production (labor), distribution (wages), and consumption (lower cost of living).
All of this is fine for developed economies, but we should not forget the struggles of those in the developing world either. Our love for our neighbors must favor those close to us, but it must not exclude those far away, especially in our contemporary, globalized world. The poor in developing countries often lack access to the basic institutions of justice, such as rule of law and private property or justice in the courts and access to markets. While some of these things overlap with the foregoing, others are fundamental to it. Thus, these institutions ought to be continually guarded at home and promoted abroad. Regarding this last point—access to markets—promoting international trade is one way nations can cooperate with one another economically, serving one another’s needs and giving more people in the developing world a seat at the table as equals rather than mere beneficiaries of aid, which at worst can be paternalistic and economically damaging.
That said, we must also avoid the pitfall of idealism. Basically all modern economies are mixed economies. They contain webs of lower economies, which themselves are webs of various local, national, and international markets, all with varying degrees of openness. Comparing Silicon Valley to the U.S. markets in healthcare, construction, or cable illustrates the wide variety that can exist in a single economy. The Christian statesman should work to reduce barriers to market entry, thereby increasing opportunity for upward economic mobility. However, realistic progress requires gradualism. The goals of politics should be justice and liberty, but they will never be defended or improved apart from prudence and patience.
Thankfully, last I checked the Gospel had something to say about those virtues as well.
Dylan Pahman is a research fellow at the Acton Institute for the Study of Religion & Liberty, where he serves as managing editor of the Journal of Markets & Morality. He is also a fellow of the Sophia Institute: International Center for Orthodox Thought and Culture. Follow him on Twitter: @DylanPahman.