Echoes in Eternity

I don't drink coffee, but I know plenty who do. As many people are aware, there is a big push in the coffee industry to promote "fair trade" coffee which supposedly gives higher wages to the poor workers who produce it in Third World countries. The problem is, that's not really the case. Furthermore, as Jay Richards pointed out in his great book Money, Greed, and God, fair trade tends to prop up industries beyond their natural free market equilibrium, which will eventually result in too many people in those coffee-growing countries investing in the coffee market. Fair trade coffee is just one more example of a "progressive" idea that is meant to make people feel good about themselves while actually doing little good or even doing harm to those it purports to help. If you have previously supported fair trade coffee, please reconsider!

John Stossel has a great piece on the importance of property rights in growing and sustaining wealth and prosperity. It all comes down to the simplicity of having one's own mailing address... something Americans take for granted. I have an address because I own a plot of land in Crystal, Minnesota. As Stossel points out, because of that, I can borrow money for investment and any business I start out of my home can be legally recognized. In developing countries, due to the lack of rule of law, property rights are either non-existent or capricious in nature. You may live in a home, but nothing is legally stopping the government or an individual from claiming that home for himself**. That is why if poor countries are ever going to begin to prosper, they need property rights. And to get those rights, they need a stable rule of law. And to get that rule of law, tyrants and dictators need to be removed and struggling democracies need to be strengthened. Which is why a simple government military intervention can sometimes do more long-term good in one day in a particular country than all of the Western charties can in a year. Or it can do much harm.

** Of course, in this country, we're steadily losing our property rights. Because of serious abuses of eminent domain, American bodies of government (local or federal) have been taking people's homes and property from them without consent and sometimes without proper compensation.

[O]ne of the great contributions of the first Christendom was the development of free markets. And I would want to maintain that one of the great results of the next Christendom will be the restoration and preservation of them. Free markets are the economic expression of the apostolic teaching that we are to serve one another in love.

Wealth is the ability to summon the labor of another, and to enjoy the fruit of that labor. Back in the olden time, the opulent could do this by owning a bunch of slaves, or servants with no options, which meant that one man's wealth meant another man's lack of it. In such settings, wealth and poverty really were a zero sum game -- if one person got a larger piece of pie, then somebody else got a smaller piece.

But in a system of free markets, God has given us the gift of being timeshare servants, and the privilege of being timeshare bosses. A young woman can save up her tips waiting tables, and go out with her friends to another restaurant and be waited on. We can do this because of division of labor. One guy makes roast beef sandwiches for 8 hours a day, and I can rent his service for 45 seconds of that time. Again, back in another time, getting a roast beef sandwich would have taken half the day. "In 1900, the average American spent $76 of every $100 on food, clothing and shelter. Today he spends $37" (The Rational Optimist, p. 34).

Many whiners spend a lot of time complaining about this state of affairs for some reason, and unfortunately many Christians have accepted the idea that we should express our ingratitude with a similar attitude, but in the name of Jesus. - Doug Wilson

Dalrymple has an absolutely brilliant piece on the hazards of excessive sympathy for the poor, particularly when applied to politics.

To sympathize with those who are less fortunate is honorable and decent. A man able to commiserate only with himself would surely be neither admirable nor attractive. But every virtue can become deformed by excess, insincerity, or loose thinking into an opposing vice. Sympathy, when excessive, moves toward sentimental condescension and eventually disdain; when insincere, it becomes unctuously hypocritical; and when associated with loose thinking, it is a bad guide to policy and frequently has disastrous results. It is possible, of course, to combine all three errors.

No subject provokes the deformations of sympathy more than poverty. I recalled this recently when asked to speak on a panel about child poverty in Britain in the wake of the economic and financial crisis. I said that the crisis had not affected the problem of child poverty in any fundamental way. Britain remained what it had long been—one of the worst countries in the Western world in which to grow up.
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My remarks were poorly received by the audience, which consisted of professional alleviators of the effects of social pathology, such as social workers and child psychologists. One fellow panelist ... dismissed my comments as nonsense. For her, poverty was simply the “maldistribution of resources”; we could thus distribute it away. And in her own terms, she was right, for her charity stipulated that one was poor if one had an income of less than 60 percent of the median national income.

This definition, of course, has odd logical consequences: for example, that in a society of billionaires, multimillionaires would be poor. A society in which every single person grew richer could also be one in which poverty became more widespread than before; and one in which everybody grew poorer might be one in which there was less poverty than before. More important, however, is that the redistributionist way of thinking denies agency to the poor. By destroying people’s self-reliance, it encourages dependency and corruption—not only in Britain, but everywhere in the world where it is held.
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The British state is today as much a monopoly provider of education to the population as it is of health care. The monopoly is maintained because the government and the bureaucratic caste believe, first, that parents would otherwise be too feckless or impoverished to educate their children from their own means; and second, that public education equalizes the chances of children in an otherwise unequal society and is thus a means of engineering social justice.
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As in Tanzania, the state-dominated system became self-reinforcing. Because of the high taxation necessary to run it, it reduced the capacity and inclination of people to pay for their own choices—and eventually the habit of making such choices. The British state now decides the important things for British citizens when it comes to education and much else.
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The only time I ever saw [President] Nyerere in person was in Dodoma, the dusty town designated to become Tanzania’s new capital. He was expected to drive by, and by the side of the road sat a praise singer—a woman employed to sing the praises of important people. She was singing songs in praise of Nyerere, of which there were many, with words such as: “Father Nyerere, build and spread socialism throughout the country and eliminate all parasites.”

The great man drove past in a yellow Mercedes. The praise singer was covered in dust and started to cough.

John Stossel has a great piece this week on the topic of racism and the Civil Rights Act.

This controversy started when Rand Paul, who had just won a senatorial primary, told TV talker Rachel Maddow that the part of the Civil Rights Act that bans discrimination by private business is improper interference with property owners' rights. He, too, condemned racism.

But the chattering class's reaction to Paul's statements must have made him uncomfortable. The next day, he issued a statement saying that he would have voted for the entire act because federal intervention was needed.

Maybe. At the time, racism was so pervasive that such an intrusive law may have been a good thing. But, as a libertarian, I say: Individuals should be surrounded by a sphere of privacy where government does not intrude. Part of the Civil Rights Act violates freedom of association.
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America's fundamental political philosophy has deteriorated quite a bit if we can't distinguish between government and private conduct. I enthusiastically support the parts of the civil rights act that struck down Jim Crow laws, which required segregation in government facilities, mass transit, and sometimes in private restaurants and hotels. Jim Crow was evil. It had no place in America.

Racist policies in private restaurants are also evil, but they do not involve force. Government is force, so it should not be used to combat nonviolent racism on private property, even property open to the public.

I just don't trust government to decide what discrimination is acceptable. Its clumsy fist cannot deter private nonviolent racism without stomping on the rights of individuals. Today, because of government antidiscrimination policy, all-women gyms are sued and forced to admit men, a gay softball team is told it may not reject bisexuals and a Christian wedding photographer is fined thousands of dollars for refusing to take photos of a homosexual wedding.

I'll say it again: Racial discrimination is bad. But we have ways besides government to end it. The free market often punishes racists. Today, a business that doesn't hire blacks loses customers and good employees. It will atrophy, while its more inclusive competitors thrive.

In the pre-1964 South, things were different. But even then, private forces worked against bigotry. White owners of railroads and streetcars objected to mandated segregation. Historian Jennifer Roback writes that in 1902 the Mobile Light and Railroad Company "flat out refused to enforce" Mobile, Alabama's segregation law.

In cities throughout the South, beginning in 1960, student-led sit-ins and boycotts peacefully shamed businesses into desegregating whites-only lunch counters. Those voluntary actions were the first steps in changing a rancid culture. If anything, Washington jumped on a bandwagon that was already rolling.

It wasn't free markets in the South that perpetuated racism. It was government colluding with private individuals (some in the KKK) to intimidate those who would have integrated. {emphasis added}

It was private action that started challenging the racists, and it was succeeding -- four years before the Civil Rights Act passed.

Government is a blunt instrument of violence that one day might do something you like but the next day will do something you abhor. Better to leave things to us -- people -- acting together privately.

HT: Steve M.

Marvin Olasky has an excellent response to the dust-up between Jim Wallis and Glenn Beck over the issue of "social justice."

Let's review the history: Was "social justice" born as a Catholic term? Yes, Jesuit theologian Luigi Taparelli tried to stem a socialist surge in the 1840s by arguing that religious and civic groups could justly improve living conditions without relying on governmental force.

Did Communists and Nazis flip "social justice" into a promotion of government power? Yes. Communist Party USA leaders instructed me in 1972 and 1973 to use those words. I haven't personally researched Nazi usage, but a leading Nazi sympathizer during the 1930s, radio priest Charles Coughlin, established a National Union for Social Justice and published a million-subscriber magazine, Social Justice. His radio audience of 16 million heard him attacking an "international conspiracy of Jewish bankers."

Do those historical wrinkles mean that the term should not be used? No, but it should certainly be defined. We can study the 150 or so times that mishpat in Hebrew and kreesis in Greek—words commonly translated as "justice"—appear in the Bible. Biblically, justice—tied to righteousness—is what promotes faith in God, not faith in government. Prophets criticized not entrepreneurs but those who combined economic and political power to lord it over others, as today's bureaucrats and corporate/government partnerships tend to do.
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Furthermore, modern usage by liberal preachers and journalists is thoroughly unbiblical: Many equate social justice with fighting a free enterprise system that purportedly keeps people poor but in reality is their best economic hope.

How to respond? I'd suggest four possible ways, one of which is a variant of Beck's: Challenge those who speak of "social justice" in a conventionally leftist way. If your local church is committed to what won't help the poor but will empower would-be dictators, pray and work for gospel-centered teaching. If necessary, find another church.

A second: Try to recapture the term by giving it a 19th- (and 21st?) century small-government twist. The Heritage Foundation and the American Enterprise Institute are trying to do this. I wish them success.

A third way: Accept the left's focus on systemic problems but not its faulty analysis. Learn about the biggest institutional hindrance to economic advance for the poor: the government's monopoly control of taxpayer funds committed to education and welfare. Work for school vouchers and tax credits that will help many poor children to grow both their talents and their knowledge of God.

Fourth and best: Tutor a child. Visit a prisoner. Help the sick. Follow Christ.

Since I'm on an economic kick these days, here is a brief discussion on the need to abolish the minimum wage and how that would significantly help the economy and soaring unemployment. Also, the author has links to a couple longer pieces at the end of the post which go into more detail on the issue.

From Money, Greed, and God:

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The Zero-Sum Game Myth is believing that trade requires a winner and a loser.
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Everything I Needed to Know About the Market I Learned in Kindergarten

It was sixth grade. We played the "trading game"... The teacher passed out little gifts to all of the students... [she] probably picked them all up in the dollar aisle at the local Kmart.

After giving every kid one gift, our teacher split the class into five groups of five students each. She then asked us to write down, on a scale of one to ten, how much we liked our gift. That was it. We didn't talk to anyone else. We just decided how much we liked our toy. Our teacher then compiled all the scores and added up the total.

Then she said we could trade with the other kids in our group. No one had to trade... Of course, a few students kept or got stuck with their original gift, but many ended up with a toy they liked more. Again, we graded our toys and the teacher added up the scores. The total score went up.

Then she told us that we could trade with everyone in the room. Now we all had twenty-four possible trading partners rather than just four...

After everyone had a chance to trade, we again graded our toys and added up the scores. The total number had gone way up. Almost everyone ended up with a toy he liked more than the one he started with. No one had a score that had gone down. The only kids whose scores didn't go up were the ones who happened to get gifts they really liked at the beginning...

I didn't get the point of the game until I played it again twenty-five years later. As it happens, the game teaches some of the most important lessons of economics.

Lesson One: Trading freely can add value even though the traded items remains physically unchanged.
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Lesson Two: Normally when trading freely, the more trading partners there are, the better.
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Lesson Three: A free exchange is a win-win game.
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Think about it. The trading partners wouildn't trade if each did not perceive himself as better off as a result. [This is what John Stossel calls the "double thank you."]
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Lesson Four: The game is win-win because of the rules set beforehand.

The players aren't allowed to coerce or steal from each other. A free market is not a free-for-all in which everybody can do what they want... Ideally, the players would be virtuous enough to play by the rules. But in the trading game, as in real life, you can't count on the virtue of others... So you need an outside enforcer. In the game... the teacher played this role. In real life, it includes parents, teachers, churches... and the government.

Lesson Five: Scarcity is almost always real.
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The peaceable kingdom of God with limitless plenty isn't one of the options. The basic options are a win-lose society based on the laws of the jungle, a lose-lose society of coercive socialism..., or a market where win-wins are possible...

Lesson Six: Opportunity costs.
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[N]o one gets to have more than one toy. In the real world, if I only have ten grand, I can't buy both a ten-thousand-dollar Chevy Impala and a ten-thousand-dollar first-issue Tales from the Crypt comic book... Trading can make me better off than I was before, but it can't give me everything.

Lesson Seven: Economic value is in the eye of the beholder.

I have to say, we need more of those teachers today as mentioned above. She was brilliant. Unfortunately, you're probably more likely to find a teacher who derides capitalism than actually understands it.

From Money, Greed, and God:

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The Piety Myth is focusing on our good intentions rather than on the unintended consequences of our actions.
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"Piety," said the Christian philosopher Etienne Gilson, "is no substitute for technique." What he meant is that having the right intentions, being oriented in the right way, doesn't take the place of doing things right. A pilot's caring deeply for his passengers and wanting to land a plane safely are no substitute for his learn how to actually land planes safely. Jesus suggest the same thing. "Love the Lord your God with all your heart and with all your soul and with all your mind." Don't forget the third item: love the Lord with all your mind. And don't misunderstand heart. Your heart isn't just your feelings. In the Bible, heart refers to the seat of your will and your emotions. I hope you already have a heart for the poor. Lots of Christians do. But do you have a mind for the poor? Unfortunately, that's in rather short supply.

God knows your heart. Spiritually you're better off a little mixed up about economics than indifferent to human suffering. Economically, though, only what you do is important, whatever your reason. Buying a bunch of bananas at Costco will have the same economic effect no matter why you buy them.
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In fact, it's morally self-indulgent to feel good about our motives when it comes to actions that affect the world... when it's time to roll up our sleeves and actually try to help someone, fixating on our motives can become a stumbling block. It can distract us from discovering the right action at the right time.
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Henry Hazlitt, an economic journalist, thought this was so important that he defined economics in terms of consequences. "The art of economics," he said, "consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."

This is one of those principles that are easy to get and even easier to forget. Unfortunately, Christians have supported all sorts of policies that were well motivated but that made matters worse, not better. Let's look at a few popular policies that are long on compassion but short on prudence.

A "Living Wage"
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Fair Trade
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Foreign Aid
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Government-Run Welfare

(p. 35-49)

The Piety Myth concept is so important in all areas of life, not just economics. While liberals tend to be the worst violators of the idea that as long as you do something, it doesn't matter what you do, everyone (especially Christians) should remember to guard against it daily. Spend your time, money, and effort on useful things. Be discerning!

Doug Wilson has an excellent piece today on the motives behind the new Marxist push in America to take from the rich and give to the "poor."

The word envy enters a lot of political and economic discussion, but it is usually referred to the envy of those who stand to gain materially after the smoke of redistribution all clears away. When someone runs on a platform of free choocolate milk for everybody, envy is driving the whole thing, and it is barely disguised. When those without money outnumber those who have it, and the question of equitable distribution comes up for a vote, how does that vote usually go? As the wise man said, it is two coyotes and a sheep voting on what to have for lunch. Like I said, that is how political envy is usually thought of, and it ought to be thought of a lot more. That is a big part of our problem.

But envy also operates at another level, a much higher level. This is what we find on display in the behavior of the pampered and privileged who wrap themselves in the dogmas of the hard left. Why would they do that? Envy doesn't explain it, at least not the kind of envy outlined above. These people already have all the chocolate milk they could want. Correct that -- they actually have all the carob-flavored coconut water that they want, which is another subject, albeit related.
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[M]en envy more than material goods. They also envy power, and the ability to dispose of others with the flourish of a pen. And when the envious are driving a nation down, each new economic crisis is used as an excuse to fix what they believe to be the real problem, which is lack of personal political control. The crisis is used, not to address the economic woes, which are simply the presenting problem, but rather to address what they believe to be the real crisis -- the fact that they cannot control everything. Yet.

From Money, Greed, and God:

The Nirvana Myth is not simply the belief that good will triumph in the end or the belief that the kingdom of God is already present in history. It's the delusion that we can build utopia if we try hard enough, and that every real society is intolerably wicked because it doesn't measure up to utopia.

We learned in the twentieth century that acting on this myth can be disastrous. Never has there been a greater gap between ideals and outcomes than in communism. In fact, so many people would not have been led astray if communism had advertised baser goals. No, communist brutalities needed the cover of some grand moral vision. Communism appealed to, even if it inverted, man's moral impulse. This is the worst outcome of the Nirvana Myth.

But the myth can have subtle effects even if we reject utopian schemes. To avoid its dangers, we have to resist the temptation to compare our live options with an ideal that we can never realize... It doesn't do anyone any good to tear down a society that is "unjust" compared with the kingdom of God if that society is more just than any of the ones that will replace it.

Compared with Nirvana, no real society looks good. Compared with utopia, Stalinist Russia and America at its best will both get bad reviews. The differences between them may seem trivial compared to utopia. That's one of the grave dangers of utopian thinking: it blinds us to the important differences among the various ways of ordering society... The free exchange of wages for work in the market place starts to look like slavery. Tough competition for market share between companies is confused with theft and survival of the fittest. Banking is confused with usury and exploitation. This shouldn't surprise us. Of course a modern capitalist society like the United States looks terrible compared with the kingdom of God. But that's bad moral reasoning. The question isn't whether capitalism measures up to the kingdom of God. The question is whether there's a better alternative in this life. (p. 31-32)

"This global-warming frenzy has all the marks of a classic sociological phenomenon known as groupthink. As a rule, when partisans appeal to "consensus" in a scientific dispute, chances are that: (a) there's not a consensus; (b) the partisans are trying to silence dissent and marginalize dissenters; and (c) the evidence for their view isn't that great. No scientist worth her salt would appeal to consensus in making a case for, say, the theory of continental drift." (Jay Richards, Money, Greed, and God, p. 195)

I ordered this book as soon as I heard about it yesterday. I've been waiting for a good book from a Christian perspective on the topic of economics; especially one that addresses capitalism and shows how it is ultimately the most Biblical economic system known currently to FALLEN man. I will likely post at least some thoughts on the book later this summer (or whenever I get around to reading it).

A writer for the New York Post went undercover to see what it was like to work at the evil Wal-Mart. Turns out, it's a pretty sweet place to work.

Some people, usually community activists, loath Wal-Mart. Others, like the family of four struggling to make ends meet, are in love with the chain. I, meanwhile, am in awe of it.
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Yet still the company is rebuked and reviled by anyone claiming a social conscience, and is lambasted by legislators as if its bad behavior places it somewhere between investment bankers and the Taliban.

Considering this is a company that is helping families ride out the economic downturn, which is providing jobs and stimulus while Congress bickers, which had sales growth of 2% this last quarter while other companies struggled, you have to wonder why. At least, I wondered why. And in that spirit of curiosity, I applied for an entry-level position at my local Wal-Mart.

Getting hired turned out to be a challenge. The personnel manager told me she had received more than 100 applications during that month alone, chasing just a handful of jobs. Thus the mystery deepened. If Wal-Mart was such an exploiter of the working poor, why were the working poor so eager to be exploited? And after they were hired, why did they seem so happy to be there?
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A week later, I found myself in an elite group of 10 successful applicants convening for two (paid) days of training in the same claustrophobic, windowless room. As we introduced ourselves, I discovered that more than half had already worked at other Wal-Marts. Having relocated to this area, they were eager for more of the same.

Why? Gradually the answer became clear. Imagine that you are young and relatively unskilled, lacking academic qualifications. Which would you prefer: standing behind the register at a local gas station, or doing the same thing in the most aggressively successful retailer in the world, where ruthless expansion is a way of life, creating a constant demand for people to fill low-level managerial positions? A future at Wal-Mart may sound a less-than-stellar prospect, but it's a whole lot better than no future at all.

In addition, despite its huge size, the corporation turned out to have an eerie resemblance to a Silicon Valley startup. There was the same gung-ho spirit, same lack of dogma, same lax dress code, same informality - and same interest in owning a piece of the company. All of my coworkers accepted the offer to buy Wal-Mart stock by setting aside $2 of every paycheck.

They were less enthused about health benefits, which offered minimal coverage during our first six months. The full corporate plan would kick in after that, but seemed to require significant employee contributions. Still, my fellow trainees assured me that health plans at other retail chains were even worse, and since the federal government had raised the limits for Medicaid eligibility, that was an option for people with children.
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We were given only a handful of outright prohibitions. No swearing in the store, for instance - not even the word "damn," because some people might be offended. No funny-colored hair or blatant skin piercings, because some people might be offended. In fact almost all the rules devolved to the sacred principle of never, ever offending a customer - or "guest," in Wal-Mart terminology.

The reason was clearly articulated. On average, anyone walking into Wal-Mart is likely to spend more than $200,000 at the store during the rest of his life. Therefore, any clueless employee who alienates that customer will cost the store around a quarter-million dollars. "If we don't remember that our customers are in charge," our trainer warned us, "we turn into Kmart." She made that sound like devolving into some lesser being - a toad, maybe, or an ameba.
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My amiable, laid-back department supervisor had been doing this kind of thing for 15 years. When I asked him why, he took a moment to process the question. He had to think back to other employers he'd worked for in the distant past. None of them, he said, had treated him so well.

What exactly did he mean by that?

His answer lay in the structure of the store. "It's deceptive, because Wal-Mart isn't divided into separate stores like a mall," he said. "But really, that's how it works. Each section is separate. This is - my pet store! No one comes here and tells me how to run it. I could go for weeks without a supervisor asking any questions." Here was the unseen, unreported side of the corporate behemoth. Big as it was, it was smart enough to give employees a feeling of autonomy.
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My starting wage was so low (around $7 per hour), a modest increment still didn't leave me with enough to live on comfortably, but when I looked at the alternatives, many of them were worse. Coworkers assured me that the nearest Target paid its hourly full-timers less than Wal-Mart, while fast-food franchises were at the bottom of everyone's list.

I found myself reaching an inescapable conclusion. Low wages are not a Wal-Mart problem. They are an industry-wide problem, afflicting all unskilled entry-level jobs, and the reason should be obvious.

In our free-enterprise system, employees are valued largely in terms of what they can do. This is why teenagers fresh out of high school often go to vocational training institutes to become auto mechanics or electricians. They understand a basic principle that seems to elude social commentators, politicians and union organizers. If you want better pay, you need to learn skills that are in demand.

The blunt tools of legislation or union power can force a corporation to pay higher wages, but if employees don't create an equal amount of additional value, there's no net gain. All other factors remaining equal, the store will have to charge higher prices for its merchandise, and its competitive position will suffer.

This is Economics 101, but no one wants to believe it, because it tells us that a legislative or unionized quick-fix is not going to work in the long term. If you want people to be wealthier, they have to create additional wealth.
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In fact, the deal at Wal-Mart is better than at many other employers. The company states that its regular full-time hourly associates in the US average $10.86 per hour, while the mean hourly wage for retail sales associates in department stores generally is $8.67. The federal minimum wage is $6.55 per hour. Also every Wal-Mart employee gets a 10% store discount, while an additional 4% of wages go into profit-sharing and 401(k) plans.
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Based on my experience (admittedly, only at one location) I reached a conclusion which is utterly opposed to almost everything ever written about Wal-Mart. I came to regard it as one of the all-time enlightened American employers, right up there with IBM in the 1960s. Wal-Mart is not the enemy. It's the best friend we could ask for.