[EDITOR’S NOTE: This post is part of our series on controversial questions. A NO post will normally follow a YES post. Join in by posting your comments.]
by Elgin Hushbeck
The quick and easy answer is a resounding yes. However, many have a distorted view of capitalism and thus will be puzzled by such a response so it requires some explanation. To begin with we must define what is meant by Economics, then Capitalism and finally we must determine just what Christian Economic values are.
Economics is the study of the means for creating and allocating scarce resources. At first blush an equal distribution might seem to be the best, but many factors quickly arise. What if there is not enough to go around? These are, after all, scarce resources. How do need and desire factor in to the distribution? Numerous other such questions and concerns can be raised and in dealing with these the study of economics is born.
While historically there have been a number of economic systems, today there are two main camps, differing in their method of controlling the allocation of resources. The earliest of these camps, Capitalism, dates from the late 18th century, seeing the means of control in a marketplace governed by competition in which individuals are the ultimate deciders, choosing what is best for them.
In the early to mid-19th century others saw Capitalism as too chaotic and began developing an alternative theory. Inspired by the tremendous advances in science, advances that led to improvements in the quality of life by taming and controlling nature, the proponents of socialism sought to adapt scientific principles to likewise tame and control the economy.
Now the preceding descriptions are by necessity brief, but it is the means of control, whether in the chaos of the marketplace, or the scientific determination of planners that marks the major division today. It is also noteworthy that these two camps are mutually exclusive. The more you pursue one, the less you can pursue the other.
It is also important to point out that the common characterization of Capitalism, i.e., that of corporate leaders controlling the economy, is as antithetical to Capitalism as it is to socialism. The key to capitalism is a marketplace governed by choice and competition, not central planning. It does not matter whether the central planning is done by government, or by corporate leaders acting in their own self-interest; it is still centralized planning and therefore not capitalism. To be clear, I would not see planning by corporate leaders as a form of socialism, just a corruption of capitalism, though at times business and government do act together to control the economy. This is crony-capitalism, a corruption of both Capitalism and Socialism.
As for values, just what, as Christians, should we seek in an economic system? While the reduction of poverty, is fairly easy, I am not sure a completely biblical list can be given. This is because the concerns of the Bible are somewhat different than our daily economic well-being. Nor are economic systems themselves inherently concerned with values. That said, some of the things I look for in an economic system beyond just the reduction of poverty, are more abstract concepts such as an improved quality of life, self-determination, and empowerment.
When it comes to judging Capitalism and Socialism against these standards, some final factors need to be considered. First while theory is all well and good, what is more important is what the system actually produces in a long term and sustainable fashion. Second, while it is important to compare likes, in reality, critics of Capitalism often compare the goals of socialism against the worse failures, or even a distorted caricature of capitalism.
In fact, Capitalism is often caricatured as grounded in greed and producing selfishness. To the contrary, the studies are pretty clear that those supporting free market approaches tend, on the whole, to be more generous and charitable.
Nor should this be much of a surprise. In any actual marketplace governed by choice and competition, the caricatured Capitalist would fail as people took their business elsewhere. Rather than greed, the core of capitalism is mutual exchange, and this exchange encourages a concern for others. While, as in all human endeavors, examples of human failings are all too common, that does not change the core. Thus management books and seminars deal with topics such as keeping your employees happy, providing better customer service, developing long term relationships, the importance of honesty and integrity, seeking Win-Win situations, etc..
Capitalism encourages individuals to improve themselves, deferring satisfaction today, and working hard for the future. In doing so it encourages the earned success that studies show is strongly linked to happiness, and as I mentioned earlier its focus on others also results in people who given more of their time and money to others than do their socialist counterparts.
In addition, the closer one moves to capitalism, i.e., the more competition and choice there is, the better things will be. In contrast, while space does not permit a complete explanation here, socialism faces three huge problems. The first is that the economy is so large and complex that understanding all the various factors needed to create a plan is impossible. Second, the power to enforce a plan results in a loss freedom, which for large plans move the state towards and sometimes to totalitarianism. Third, there is a question about long term sustainability of large socialist governments on issues of debt and demographics.
Nor is government immune from the same human failings that afflict every other human organization. When you are wronged by a business in a free market you can go elsewhere, and even appeal to government for redress if need be. When government wrongs you, where can you go?
Ultimately, the key advantage of Capitalism is that it focuses on the creation of wealth rather than its redistribution, resulting in a better standard of living and providing the means to being more generous. The results of this are seen in the fact that since 1970s the worse form of poverty has fallen by 80% as a result of the introduction of capitalist programs such as micro-credit.
Thus while not really Christian, Capitalism reduces poverty, allows people to live better and happier lives, and results in people who are more generous in their giving to those in need. Not bad for a system who primary focus is the efficient creation and distribution of resources.