Virtue in Capitalism

Manuscript: 2009 Marketplace Speech

In 1977 at the University of Zurich, one of my personal heroes, Margaret Thatcher, said:

“We must not focus our attention exclusively on the material, because, though important, it is not the main issue … The economic success of the Western world is a product of its moral philosophy and practice. The economic results are better because the moral philosophy is superior.”

Lady Thatcher is still with us today, unlike some of my other heroes – great champions of freedom like Milton Friedman, Ronald Reagan, and William Buckley, all of whom have passed on over the last several years. What has surely survived even these great men, and will survive the extraordinary Margaret Thatcher, is the belief that a moral society will enjoy greater prosperity than a non-moral one. Freedom and virtue are not at odds with one another, but in fact, depend on each other. Tonight, we explore the integration of economic liberty and Christian morality. I believe I am not exaggerating to posit tonight that very few issues command greater attention in the contemporary context than that of a virtuous market system.

The discussion of morality and markets may seem to the casual observer to be too philosophical of a discussion for a Marketplace Ministry – a group focused on re-motivating believers to excel in their careers, and glorify God in their callings. But of course, there is no dilemma here. In fact, it is the absence of a visible presence of Christians in the workplace (and by Christians, I do not mean nominal Christians who may or may not attend church; I consciously mean those who hold to a world and life view of Christianity; those who seek to live out our great catholic faith in all spheres of life) that I believe has undermined the moral nature of our free marketplace. The economic woes the global economy presently suffers through were most certainly caused by a lack of virtue in the free market system, and the solution to this shortcoming can not come until men and women of faith and conviction re-occupy the highest professional seats in the marketplace. Tonight I hope you will see this connection, feel this conviction, and apply these tenets to your own worldview and daily practice.

It is no secret to those who know me that I am a committed capitalist. Admittedly, I see free market capitalism as a fundamental part of my personal political belief system, leaning towards the great political heritage of our founding fathers who sought to protect the pursuit of prosperity, and as Walter Russell Mead has demonstrated, built a country around the pursuit of a better life. But beyond the political orientation of my own capitalism, I actually see it as a very important component of my own faith. The Biblical commandment, “thou shalt not steal,” mandates the existence of private property, and with private property, comes a system of thought around it. The book of Proverbs serves as a sort of ancient manifesto for what we now call capitalism, decrying those who seek gain without work, and commending those who create prosperity and wealth through ingenuity and hustle. Our brilliant speaker last year, Dr. John Schneider, has laid out the exegetical case for the nobility of affluence in his remarkable book, The Good of Affluence, a book that I remain willing to send a copy of to anyone who asks. Tonight, I am not as interested in making the exegetical, or theological, case for wealth, as I am interested in connecting the dots between the moral worldview of the Christian, and the market economy of the capitalist.

We live in remarkable times. The nearly universal collateral for the global economy, various forms of real estate, has collapsed under the weight of the biggest bubble burst in recorded history. A worldwide banking system has been forced to the abyss, reaping what they have sown through excessive leverage, the lack of underwriting standards, and remarkably inaccurate projections about the direction of asset prices. More incredible than the malaise we suffer through, though, is the horrific response to this malaise from a democratic country governed by a Constitution, and rooted in the Judeo-Christian ethic. One has to search far and wide to see commentators who do not blame the present malaise on a failure to regulate, or a failure of Wall Street, or on a failure of the free market to properly work. Many criticisms contain half-truths, and the half of the criticism that is true warrants reflection and agreement. But it is the part being ignored that petrifies me, for I fear that an inability to understand the root cause of what has happened ideologically will doom us to repeat the same mistakes. Even worse, I fear that ignoring this topic we are to address tonight exposes us to potential “solutions” that are even worse than the “problems” themselves. We can not fix the free market by getting rid of the free market. Secular economists and clueless politicians can explore this in perpetuity, but it is all for naught apart from one thing: A marketplace rooted in virtue and Christian morality.

Adam Smith is often portrayed as a secular British philosopher who created a secular system of thought known as capitalism. His notion of an invisible hand in the marketplace allowing for the exchange of goods and services is not inherently “secular”, any more than two people telling each other the truth is inherently “Christian.” What we as believers need to advocate is not just the economic merits of the free movement of the “invisible hand”, but we also must begin advocating the moral demands of the God whose invisible hand it is that is actually controlling the affairs of mankind. Smith was right that businessmen and women acting in their own self interests serve the initial foundation of a free and prosperous marketplace. But the story does not end there. The system breaks down to calamity when vice is not overcome by virtue. The Bible does not condemn the pursuit of wealth, and I risk sounding like a broken record in my constant (and needed) advocacy of this message. But the Bible is not silent about what type of people God wishes to see pursuing wealth either- and repeatedly, also at the risk of sounding like a broken record, the Biblical narrative is for a marketplace filled with people of character, who honor and obey the Ten Commandments, and who treat one another with respect and dignity in their transactional dealings.

Few organizations are doing more to advocate the integration of markets and morality than the Acton Institute, co-founded by our keynote speaker tonight, Reverend Robert Sirico. What they champion is a capitalism that recognizes transcendent truths as fundamental prerequisites to a cohesive outlook of economics. Their work reinforces liberty as man being free to do what he ought to do, and not merely what he wants to do. Acton has have done innovative work in these subjects, and I commend them as highly as I commend any organization out there.

But tonight, I want to plead with you not just to balance your beliefs about the free market with your appreciation for the Ten Commandments. I want to exhort the audience to apply this to your daily lives. There is no global economic calamity right now without people who failed to live up to their personal micro commitments. There is no banking collapse without a systemic dishonesty that favored commissions and instant gratification over prudence and honest measures. There is no leveraged destruction of assets without people taking reckless bets with other people’s money, callously ignoring the risks their decisions posed to the community of mankind. We do not suffer through a failure of free enterprise tenets; we suffer through the failures a depraved human nature can perpetrate when it is not bridled by the renewing grace of a triune God. I adore the work of the great capitalist innovators of the free market tradition, but ultimately, it is a house built on a sandy land that ignores the nature of mankind, and ignores the story of redemption.

Ours is a system of thought rooted in Scripture, and Scripture demands that mankind obey rules far stricter than anything a self-serving politician or regulator could ever successfully legislate. The effectiveness that Christians have in living careers of character will determine the effectiveness that Christians have in living careers of dominion, success, and prosperity. The future does not belong to the wicked, the crafty, and the self-serving. As believers who know full well the concept of moral progress, the future belongs to those who integrate Christ, and His righteousness, into all aspects of their lives. The “city on a hill” I long to see created will be visible to the world when that city’s inhabitants commit themselves to a virtuous capitalism. No system ever created has done more to create liberty and prosperity than good old-fashioned capitalism. Tonight, as a believer passionate about Christians in the marketplace, we offer a distinction between capitalism that is purely secular and humanistic, versus capitalism rooted in character and transcendent truth. It is the latter that has staying power, it is the latter that speaks to the great challenges of our day, and it is the latter that brings glory to our Father in heaven.