Morality, Society and the Economy
by L. Carlos Lara
Francis A. Schaeffer’s description of the problem with Christians in this country in the last one hundred years can also appropriately be applied to all of the citizenry of the United States, Christian or non-Christian; in that we have all seen things unfold in bits and pieces. We have not only been born into an existing social, economic and political system not of our own choosing, but we have very gradually become aware of specific areas of grave error, but have not seen this as a “totality”—each thing being a part, a symptom of a much larger problem. This strange phenomenon also includes our brothers and sisters in Canada.
In his book, “A Christian Manifesto,” Schaeffer goes on to point out that the problem stems from the abolition of Truth and Morality.1 And, though we can remain reasonably calm and agreeable to the word “truth” in his statement, it is the word “morality’ that will begin to give us all kinds of mental twists and turns. For instance, he specifically mentions over-permissiveness, pornography, the public schools, the breakdown of the family, and finally, abortion as exclusive examples of gross errors brought about by “a fundamental change in the overall way people think and view the world and life as a whole.” To his list we could take our individual turns at adding to it, or subtracting from it, and finally winding up with a universally recognized list of major human failings–the Seven Deadly Sins of pride, greed, lust, anger, gluttony, envy, and sloth.
My point, however, is that just the mention of the word “morality” or its opposite “immorality,” let alone “sin,” can open up a cauldron of debate among Americans in this day and age and not surprisingly with serious disagreements even within Christendom and certainly outside of it. These disagreements can vary with some of these issues being classified as pockets of social maladjustments, serious violations of moral laws and principles, or simply God-given instincts, so necessary for our existence, exceeding their proper functions.
This article is about a different kind of focus on morality. As the title suggests, it is about the correlation between morality, society and the economy. A correlation repeatedly found in the study of Economics. And, since our main concern in these articles is with “making a living,” which is what economics is all about; our focus needs to be concentrated here in order to illuminate the morality and immorality to which we will speak to.
The problem this article will eventually point to does have its origin in “human nature,” however, I will warn you in advance that the manifestations of its particular evil has even far greater consequences on us as Americans than those outlined in Mr. Schaeffer’s book. The evil that great thinkers of centuries past pointed to and, which is the subject of this article, sets up as its ultimate goal the total enslavement of society and its eventual destruction. It was this view and of this evil in particular that eventually lead to the embodiment of economics as a science and should make us take note as to how important it is for us to undertake it as a personal study. With such a concentration of human thought in this one area, beginning with Aristotle, one begins to see support for the oldest exploitation known to man.
“Yes, man is endowed with the gift of reason, but he is also possessed of appetites and an aversion to labor, and too often his reason bends to his other characteristics. The failure of utopians to accept this fact, or accept man as he is, not as he ought to be, gives their schemes a dreamlike quality.” Aristotle
Aristotle points to utopianism for a reason. As a general rule the belief that an ideal society can be achieved falls into two main polar extremes, the anarchist and the communistic. What is significant of these two extremes is that all utopian programs pay considerable attention to the political organization of man. The anarchist believing that the perfection of man can be reached through education and that once fully educated or, that he comes to his senses, the need for government can actually be removed. The communist, on the other hand, would have the government control everything. In fact, it wants the removal of man’s natural inclination to own anything at all. You and I, of course, fall somewhere in between these two extremes.
This article may help you pinpoint more accurately where you actually stand.
I should clarify that when I admonish you to take up economics as a personal study you may be envisioning the type of economics you most likely studied in college. This is not what I mean at all. I am not and never have been enamored, nor do I have a fascination with the study of cost curves, equations, graphs and other similar complicated mathematics that make up the modern economist.
This type of economic hyper-specialization, in my opinion, and in the opinion of many others like me, has totally lost touch with the political and social problems of our day. That type of economics, though pervasive in our country and which literally makes up the foundations of our current political and economic environment, is cracking badly because it was doomed to fail from the start.
There is, however, a classical school of economic thought which refuted this falsehood when it first appeared in America in the early 1900s and it has stood its ground ever since. This school of thought, this sleeping giant, lying dormant for so many years, is awakening and it is the school of thought to which I point you to. By using verbal logic i.e., deductive reasoning and “praxeology” (the study of ‘human action”), this school of thought alone enables us to see with clarity the right correlations between morality, society and the economy that are most needed for us and our family. This is Austrian Economics.
How can we see in totality, in a big-picture format, this correlation of morality, society and the economy which the Austrians see? How can I bring to you into full view the significant and particular evil of this discussion for closer inspection? This is where my challenge begins.
I should first start with a couple of blanket statements regarding this subject which we can all agree upon; when immorality and lawlessness become pervasive, the continued existence of any society is threatened.
In addition to this, we must emphasize that the framework of any economy is quite extensive and it includes not only the institution of government, money, property, etc., but also social institutions such as customs, traditions and beliefs. Without virtues such as honesty, integrity, kindness, thoughtfulness, punctuality, diligence, respect for legitimate authority and so forth, an economy cannot function
Bottom line, moral values are fundamental for trade and production to take place. Men must respect the property rights of others. If there is a constant abuse and trespass of the rights of others, people will spend all of their energy and time trying to protect themselves rather than spending their time in productive work.
However, by far the most important fact to bring out with regards to this subject is that there are questions of morality in government action as well as in individual action. Paraphrasing Austrian thinker Frank Chodorow from his excellent book, “The Rise and Fall of Society,”2 we can get to the central theme of the intellectual argument which goes something like this:
Starting with man we find his inner urge to improve his circumstances and expand his horizons. His wants drive him from one form of gratification to another which represents a cost, an expenditure of labor which because it produces weariness, man finds it distasteful. Man’s inclination is to bypass work as much as possible without giving up his place of betterment. Utilizing a uniquely human gift, the faculty of reasoning, he determines that the endeavor of multiplying satisfactions is best accomplished by cooperation with his fellow man. In this way a society is born. Within it you find specialization of labor, exchange, capital accumulations, and competition. Society, then, is a labor-saving device which comes about instinctively. It is not a contractual arrangement any more than the family is, but like the family, it germinates in the composition of man.
The price paid in the marketplace for goods and services is always paid with reluctance; there is no way of getting around that. Out of that inner conflict between cost and desires, the drama of organized man is revealed and, in his efforts to realize the impossibility of “getting something for nothing,” man frequently turns to theft.
Since man only works to satisfy its desires, the pain inflicted in the transfer of possessions and enjoyments from producer to non-producer cause the producer to set up protection mechanisms. In the most primitive societies, man relies on his own strength or weapons he has at his disposal. However, this constant surveillance and protection over his property, not only is frequently ineffective, but it takes time away from the primary business of producing satisfactions. As a society and its wealth grow, man soon becomes ready to turn the protection service over to a specialist, thus government is born.
The distinctive feature of the service of government is a complete monopoly on force. This is the necessary condition for its business; otherwise it defeats its entire purpose for being. But now here is the real catch, the fact remains that government is a human organization consisting of men exactly like the men they serve. That is, they too seek to satisfy their desires with the minimum of exertion and they too are insatiable in their appetites. Most essentially is the fact that, in addition to the desires which possess all men, government personnel have one distinct feature to their occupation and that is the adulation showered on them because they alone exercise force. They are a people set apart.
The temptation for the expansion of power is strong for men of ambition, the function of protection is too confining. History demonstrates that governments soon turn to invading the market place, to regulate, control, manage, and manipulate it under the guise of positive interventions for its betterment when in fact the techniques are already self-operating. Its real purpose is to control human behavior and will demand compliance by threat of physical force. That is the crux of the matter, the be-all and end-all of political power.
In its pursuit of power, government takes on the inescapable “something for nothing” passion and proceeds to win the support of segments of society, i.e., favored individuals or groups bent on improving their lot. In other words, government sells privilege, which is nothing more than an economic advantage gained by some at the expense of others. Without the support of privileged groups, government would collapse and vice versa. The instrument that puts government into a bargaining position with its favorites is “taxation.”
In the beginning, when society is small and a government is formed, no one disagrees that the service must be supported and paid for by the market place. The manner in how government services are paid for, however, poses a great problem in that they are compulsory charges, not voluntary payments. Furthermore, the power entrusted to government officials for the collection of these taxes happens also to be the collection of their own wages. As long as government is under constant surveillance by society, the urgency of government to increase its taxes for the enlargement of political power can be held in check, but this starts to become ineffective as the size of society increase in complexity. With interests and centralization, it acquires self-sufficiency with the ability to meet its enforcement payroll and to invest in power accumulating enterprises.
When, eventually, government has the market place under its complete domination, it becomes the only privileged class. Custom and necessity reduce society to a condition of subservience to the officials of the government. This condition we all know as “totalitarianism,” which is the final conquest of society by government. Society is enslaved.
Is this then the end? Not yet. We must not forget that governments have no wealth of their own and must support itself from the productive efforts of the members of society. It thrives and grows from what it expropriates; the general decline in production which it induces by its avarice foretells its own doom. Its sources of income dry up. Therefore, in pulling society down, it pulls itself down. The records show that its ultimate demise is usually occasioned by a disastrous war, but preceding that event is a history of increasing and discouraging taxation on the market place, causing a decline in the aspirations, hopes and self-esteem of its victims. Therein lays the real crime, the evil and immoral aspect of it all.
Herein are the issues and questions that you and I must answer and must be ultimately answered in terms of morality. Answering them now rather than later could make all the difference in our society in terms of where it will eventually end.
The following three main points may be of some help.
Point No. 1: All humans fall short of the goal of perfect self-government.
Moral values are inculcated primarily within the context of family life. Children are taught the rudiments of morality and acceptable behavior in the home. They are taught within the framework of parental authority first. The dos and don’ts as well as the things that may endanger the child or harm someone else are all taught in the early years before school age. At some point the child begins to question why he should do this and not do that. The parent may need to invoke other authorities for certain prohibitions because reason alone is often an uncertain authority. If there are siblings in the home, they may assist the parent as counter authorities. From there, school, playmates and peer groups come into play. Then there is Church or Bible which can become supplemental or ultimate authorities. The idea of wrong doing by an appeal to conscience may be made and that certain things are against the law. This can have the effects of building up a trustworthy and virtuous society where people can be trusted to perform according to their word and is one key potential for economic success in a society. All this initial teaching is to suggest how people come into contact with morality and the authorities. However, it is by no means an easy matter to inculcate morality. In dealing with this subject Austrian Economist and Professor Clarence Carson has written, “As an infant, man is observably self-centered, concerned only with his own desires and gratifications. Only slowly, and often painfully, does the child learn more sociable and thoughtful behavior, and if enlightened self-interest replaces self-centeredness as an adult, considerable progress has been made. In truth, man is subject to strong emotions, to fits of temper, may become violent, aggressive and destructive… it is these potentialities in the nature of man…that make government necessary.”3
Even with ultimate religious sanctions, the teaching by parents of upright and moral behavior, and legal punishments for many kinds of wrong doing, there has always been more than a small amount of lying, cheating, stealing, killing, and trespassing. Sometimes it is more widespread, and in some specific places even rampant. In such chaotic times, the evil of which men are capable becomes apparent to everyone.
Point No. 2: There will never be a perfectly good government.
“Let every person be subject to the governing authorities. For there is no authority except from God, and the authorities that exist are appointed by God. Therefore, whoever resists the authority resists the ordinance of God, and those who resist will bring judgment on themselves. For rulers are not terrors to good works, but to evil. Do you want to be unafraid of the authority? Do what is good, and you will have praise from the same, for he is God’s minister to you for good. But if you do evil, be afraid; for he does not bear the sword in vain; for he is God’s minister, an avenger to execute wrath on him who practices evil” Romans 13:4
Upon thoughtful consideration of this passage it is clear that the Apostle Paul is not leading us to believe that all laws made by government were or are good. In other words, he did not believe that governments did good all the time. What he makes clear is that the proper role of government is to punish evil doers in order to protect the life, freedom and property of its citizens under its authority. As long as the individual keeps himself from trespassing unlawfully against the rights of his fellowman, he has no reason to fear the policing force of his government. And, so long as the government goes about its business of protection and the punishing of evildoers, the Christian is compelled to obey.
About this passage Professor Paul Cleveland expounds further: “There is nothing in Paul’s words that indicate that there isn’t some appropriate time to refuse submission to government, or that a ruler should not be removed from his position if he neglects too much the good purpose of government, or if he abuses too greatly the power of his office. In fact, there are many passages in Scripture which condone civil disobedience. But, it was not Paul’s intention in this passage to develop the theory of civil resistance against an unjust government that has been presented thus far. In particular, governments exist for the good of those who do good. When this is the case, government is pursuing its appointed end of securing the rights of life, liberty, and property of those subject to its rule.” 5
No government can be a perfectly good government from the simple fact that governments are run by people and people are flawed individuals. In the end, no perfectly good government can exist in this world. From this follows that we can never hope to have or expect to have perfect justice in this life. Are we to conclude that since this is the reality of our situation that no amount of resources committed to protect us would ever rid us of crimes committed against us? The answer is yes. They can never be completely eliminated. Insisting that government intervene for these purposes may be costlier than the gains achieved.
Point No. 3: When Government Turns Evil
At the time the United States was founded, the Founders believed that Americans were suffering far beyond what should justly be expected under the power of the British crown. Professor Paul Cleveland writes:“In their view, the English government had overstepped its bounds that it could no longer claim its God given position to rule. As a result, they believed that the Declaration of Independence was warranted. After the revolution, they went on to hammer out the Constitution. In doing so, they demonstrated their understanding that the government they were fashioning would also fall short of perfection. In the Preamble to that document we read the following phrase…”in order to form a more perfect Union…” they understood how easily power could be used for evil ends. Therefore, they set up a government that was held in check in several ways.”5
For the most of the 19th century, Americans generally still believed in the need for a contingent institution to secure the peace and order of society. At the same time, they believed strongly in an order of the universe. They also believed that it was a moral order for it had been created by God. It was virtuous to act in accord with this order. Such a belief was conducive to faith and an abiding belief that the order of the universe brings about harmony out of the diverse activities of men if government does not interfere with it. It was beliefs such as these that underlay the great achievements in America.
There followed, however, the introduction of new ideas from the middle of the 19th century onward that the market and unhampered economic activity worked for some classes of people, but not for others. Therefore, some so called economists began to champion various interferences in the economy by advocating government intervention. By the arrival of the 20th century the government that was designed with extensive checks and balances had begun to weaken and move away from its Constitution. By then of course, economists were making a living by advising government in what ways to intervene in the economy. In fact, the President of the United States now had its own Council of Economic Advisers. The election of Senators by popular vote, the introduction of the income tax in 1913 and the establishment of the Federal Reserve System in that same year opened the door for many more abuses of government power.
In the 1930s there was an all-out assault on the Constitution during the presidency of Franklin D. Roosevelt. The end result has been a massive increase in the size of government and severe intrusion into the lives of the American public. The current institution is now more vulnerable than ever to be easily abused by unprincipled men. History demonstrates that the centralization of power such as that of our current government is dangerous. Concentrations of such power will ultimately lead to disaster.
Message of Hope
Were it not for Austrian Economics I would not be able to see the reason behind why I must always oppose government intervention. Were it not for Ludwig Von Mises, the champion of liberty and Dean of the Austrian School, I would not feel the inspiration to stick to principle and to argue quietly and with confidence as he did in favor of the superiority of a decentralized, consumer-oriented market, in contrast to a bureaucratic, centrally planned economy.
So long as this is true we have a duty to speak even more clearly and courageously, to work hard, and to keep fighting this battle while the strength is still in us.
REFERENCES
(1) Francis A. Schaeffer, A Christian Manifesto, Copyright 1981, revised edition 1982. published by Crossway Books Westchester, Illinois 60153
(2) Frank Chorodov, The Rise and Fall of Society, Copyright 1959, The Devin Adair Company, New York
(3) Clarence B. Carson, Basic American Government, Copyright 1993, American textbook Committee, 3105 Fourth Avenue, Phoenix City, AL 36867-3309
(4) Paul of Tarsus, Bible, New Testament, Romans Chapter 13
(5) Dr Paul A. Cleveland, The Journal of Private Enterprise, Fall 1997, pp 81-99