by Charlie Self
Introduction: Toward a more just community
Community economic development that brings opportunities for all classes and cultures to flourish is an aim shared by thoughtful women and men of all religious and political persuasions. The integration of personal and social ethics, business and public sector leadership, and the influence of religious institutions are vital for sustainable uplift. Recent works by Luke Bobo (“Living Salty and Light-filled Lives in the Workplace”), Brian Fikkert (“Practicing the King’s Economy”), Tom Nelson (“Work Matters”), Amy Sherman (“Kingdom Calling”), Robert Woodson, Jr. ("Lessons from the Least of These") and others underscore the positive influence people of faith bring to the community – IF they see people holistically and evaluate social systems well.
Reflective Christians and thoughtful people of conscience often wrestle with the justice of economic systems. In the 20th and 21st centuries, complete collectivism/socialism, with the economy under centralized government control, has proven to be unproductive and destructive of human well-being. From the old Soviet Union (1918-1989), to Nazi Germany’s (1933-1945), to Mao Zedong’s Great Leap Forward in China in the 1950s and 1960s, hundreds of millions suffered under both ideological and economic oppression. More recent experiments in Cuba, North Korea, Venezuela, and Zimbabwe reveal the terrible cost of suppressing human freedom and incentives for work.
Many folks also are concerned about unregulated capitalism, with significant income gaps between the rich and poor and concerns about exploitation of labor. Historically, there has been much progress for workers since the early 19th century through effective reforms, economic growth, and the rise of collective bargaining. The unprecedented rise in global prosperity since 1950, with billions emerging out of poverty, is the result of access to global markets, technological innovation, and an increase in opportunity for people to access education and training, own property, make investments, and relocate when needed.
For any economy to work well, personal and social virtues are essential. Collectivism stifles creativity and incentives, while free market systems can leave entire classes of laborers behind as innovation outpaces professional skills. Economists around the world have affirmed that the conditions for sustainable economic flourishing include personal virtue, property rights, freedom of conscience, political liberty with just systems, and access to capital and markets.
The relationship of ethics to economics was inseparable until the 20th century. Until the last 130 years, economics was a subset of moral philosophy, as well as an emerging social science. Adam Smith’s famous affirmation of free markets in his 1776 classic, The Wealth of Nations, focused mostly on the virtues necessary for the “invisible hand” of the market to function well. But free market economics did not begin with Smith or with the “Protestant Work Ethic” of the 16th century championed by the modern thinker Max Weber (1864-1920). In the 14th-16th centuries, the university of Salamanca in Spain was a center of education in all fields, particularly economics. “Natural pricing” and free trade were promoted as the best pathways for all to flourish and for peace among nations.
The Angelic Doctor speaks
St. Thomas Aquinas (hereafter Thomas – 1225-1274) is the most influential philosophical and theological figure of the past millennium, and a major voice underlying these notions of economic and social virtue. Thomas’ theology is considered foundational for the Roman Catholic Church, hence the “Angelic Doctor” honorific. Orthodox and Protestant believers have benefited greatly from Thomas’ synthesis of philosophy and theology, his outstanding apologetics, and his masterful Christian mind on a variety of topics.
Thomas applied his mind to economic wisdom, especially the notion of the “just price” in trade and transactions. Thomas penned his ideas during an expansive historical moment, with Italian city states emerging as financial hubs and Western Europe awakening from her economic and social slumber. This context is important. The climate was in a warming cycle, and while the agrarian feudal system was at its height, there was a rising merchant class and increased trade among empires and emerging nation-states. The parallels with current changes are fascinating.
Thomas saw economics as the fruit of a virtuous life lived in community. The needs of the community take precedence over production and consumption, especially once basic necessities (daily food, clothing, and shelter) are met. Thomas does not, however, condemn commerce and profit per se. Community flourishing benefits from expansion of opportunity and trade. Leaders are stewards of the well-being of their families and societies. He defends both private property and the common good. He is promoting his thinking in an era of more static social classes, with the feudal idealism of the aristocracy protecting the peasantry and an emerging merchant class.
Buyers and sellers negotiate and settle on a price agreeable to each side: the market price. For Thomas, then, the market price is the just price if the buyer and seller are honest and not trying to take advantage of each other. The ethical problem arises when there are dishonest participants, especially when the civil law allows or encourages such dishonesty. A just price should reflect the worth or value of a good or service. How is such value determined? Usually quite subjectively, hence marketplace haggling. Thomas affirms just prices vary over time and place.
As a moral theologian and non-economist, Thomas understands the ethics of buying and selling as one part of a virtuous life. The laws and customs of a society can either help or hinder the pursuit of virtue. There can never be a “just price” between evil people or for nefarious ends. The moral character of the buyers and sellers is more important than the act of buying and selling itself.
Thomas’ teaching about economics cannot be separated from what he says about God, reality, and virtue. The just price is not simply a matter of economics or individual practices. While Thomas leaves room for subjective valuations of the just price and legitimate human freedom, these are inseparable from concerns for humankind’s eternal destiny and the temporal common good.
Thomas sees humankind as a political animal, with natural fulfillment only in community with others (our earthly communities are imperfect preparations for the eternal fellowship with God and each other) and with an axiomatic concern for justice. The virtuous man is fair in all his dealings, including economic ones, giving to each his due and perhaps even more, but he cannot be virtuous on his own. He needs friends who also love virtue, good laws and customs, and, above all, God’s grace. As with most Christian thoughtfulness, Thomas’ ideas will not fit in the ideological boxes polarizing much of our world.
Applications for our contexts
Rightly understood, economic justice does not mean the same exact outcomes for every person. Justice applied well includes access to capital, education, opportunities, and the personal and social relationships that empower flourishing. Thomas’ teaching on virtue is essential for integrating community flourishing, market opportunities and realities, and sustainable systems.
In our polarized world, there is an unbiblical tendency to separate personal and social ethics, and privatize moral and religious sensibilities. Ideological assertions are unhelpful when they do not factor in the complexity of the human person, family structures, and social realities. Collectivists do not understand economic risk and reward, and historically, once they control industries, they no longer flourish. Even well-meaning attempts to “equalize” only equalize scarcity, with the bureaucratic class living large and the masses poorer than before. Radical individualists focus exclusively on personal agency and forget the historical and systemic issues that undermine many entrepreneurs, especially the historically marginalized.
Thomas’ call for virtue can help business leaders decide ahead of time the moral vision behind their economic and social aims for their enterprises. A call to virtue will also hold political classes accountable for how their programs actually work. We have learned the hard way that government largesse alone is not sufficient for long-term flourishing. Thomas’ understanding the negotiable prices will help people understand the complexity of a price. For example, the $175/hour labor charge for auto repair must cover rent, environmental concerns, workers’ compensation, salaries, supplies, and much more before the owner takes home a dollar. That expensive smartphone may be a big profit center for a large company, but millions of working folks have retirement funds invested in such companies. This is why the “fair price” is not set by government fiat.
As we aim for wisdom in our changing world, sometimes it is good to go “back to the future” and learn from the saints upon whose shoulders we stand.
Dr. Charlie Self [BIO]. He also serves on the Board of Advisors for Faithful Presence.