I do not usually discuss issues like this in this blog, but I do want to share my thoughts on the Bible and Free-Market Capitalism because I have degrees in, and interest in, both economics and theology. In this I am like James D. G. Dunn and Andreas Kostenberger, though the similarity may end there.
Anyway, I often have thought that seminaries ought to teach some basic economics since I hear not a little nonsense coming out of some seminary-trained ministers. And I do not mean that it is simply that I disagree with their conclusions, but that they betray a poor understanding of how economies and markets work. In fact, I could do several posts just about some of the poor assumptions and analysis in this regard, but for now I will (try) to restrict myself to what the Bible may, or may not, say about our own economic system.
The above question could be simply be answered "no, the Bible does not explicitly say that free-market capitalism is the right or the best system" since there was no such thing as capitalism in that day and the Bible does not prophesy that it would come into being. With that being stated, we can still examine whether our economic system meets certain biblical standards.
The first question that we would ask an economist is "what is capitalism?". Capitalism is, simply, the private ownership of the means of production. In an agricultural society, the means of production was the land. The vast majority of society were farmers and they needed land to grow crops and tend animals. In an industrial society, far fewer farmers are needed as technology has made it possible to produce far more crops on less land and with fewer people.
Since the Bible was obviously written in the agricultural age with capital goods playing a relatively minor role, we would expect that the Law of Moses, which gave the Israelites laws about how to govern their society, should tell us how an agricultural society should act justly. But we also might find principles that would apply to our own situation. That is what I will attempt in the these next few posts.
The two basic systems in our day are capitalism and socialism. Capitalism is the private ownership and control of the means of production; Socialism is the public ownership and control of the means of production. Which one does the Bible support - if any?
First of all, does the Bible teach private property rights? The answer is emphatically, yes! One on the ten commandments says, "Thou shalt not steal". A person cannot steal if nobody owns it. One could complain that terms like "property rights" do not appear in the Bible, but neither does the expression, "free will", but both are biblical concepts. God holds us accountable for our choices, so that implies that we can choose freely despite what my Calvinist friends might say. Likewise, the fact that the Bible says that we should not steal implies that we have property rights.
The question, then, is does the Bible teach that the means of production should be privately owned. Well, in the Bible who owned the land (the means of production)? The people owned the land. Now this may not seem like a big deal since we are accustomed to owning land, but in that day it was not simply a place to live and have a house, but it was the families' way of making a living. In fact, the Law of Moses gave the people the right only to sell their family's land only for a period of time before it must be returned to the original family. So the family's right to the property was actually stronger for them than it is in America today.
In 1 Kings 21, we read of how King Ahab desired the vineyard of Naboth. He was sad because Naboth did not want to give up his family's land. Jezebel, who was Canaanite, could not believe that a king could be refused by one of his subjects. In her native country, the king could take any land he pleased. So Jezebel falsely accused Naboth and had him stoned. Then she seized his land and gave it to Ahab. We need to notice something here. Even Ahab, a wicked Israelite king, did not presume to take land belonging to another without their consent. Unlike Jezebel, he knew that Naboth had a right to keep his land and do with it as he pleased. And notice that the land was productive as well. The means of production was in private hands.
Let's look at some examples in our own time: Argentina and the Lakota Indian Reservation. Argentina has struggled economically for the past fifty years. The IMF (that's the International Monetary Fund not the one from Mission Impossible) helps countries get their act together economically. They have worked with Argentina over and over to give them a better economy. They do what is suggested to them, but they always falter.
This is well known by economists, but the IMF cannot fix the main factor in their continuing failure - secure property rights. Many people do not know that a hundred years ago Argentina was the tenth leading economy in the world. Then, in the 1950s, the Perons came to power and undermined property rights. They took what belonged to others and gave it to friends. Even today, their courts will easily take away property on the smallest of pretexts. That means that corporations will not invest in factories, etc., that would help them to become strong economically once more. Until that is fixed, Argentina will continue to flounder.
Another example of this is our Indian reservations. Just before a friend of mine moved to South Dakota to do mission work on the Lakota Indian Reservation, I read an article which studied their economic problems. It is just about the poorest place in our country. Why? Because the reservation does not ensure individual private property rights for land. The reservations are self-governing. They are not a democracy. Traditionally, the chiefs make decisions such as what can be done on any property on the reservation. This is their custom and culture.
Their culture, where property is controlled by the chiefs and not individuals, is keeping them in abject poverty. In the nineties, Gateway Computers wanted to build their computers on the reservation, providing jobs for thousands of Indians. They couldn't do it because they would not have secure rights to the land. They could purchase the land and then the chiefs could take it back whenever they pleased. Nobody is going to invest in that kind of situation. An individual who wants to run even a convenience store cannot do so because they might run afoul of the chiefs. Of course, the chiefs take the money that our government gives them and they build themselves real nice homes. They drive real nice vehicles and they eat sumptuously. The people scrape by and are often cold and starving.
Okay, I have gone beyond the biblical text and given some examples that I hope will help us see that not only does the Bible support the private ownership of the means of production, but show that the lack of property rights hinders economic growth and can even cause oppression. In the latter case, it should be clear to us that that is unbiblical.
So we can see that without property rights there is no prosperity. I could rail against the injustices of the chiefs, but that is not our purpose here. Our purpose is to see whether free-market capitalism is biblical. I think that we have shown, so far, that at least the capitalism part is biblical.