Wednesday, November 23, 2005
On God and Riches.
While far away from me the idea of even remotely criticizing the rightful place of religion in society in terms of history, education and anthropological value, one recurrent economic theme is the change of perspective that today’s distribution of wealth has created vis-à-vis secular religious beliefs. This is so because the tenets of wealth and economics have changed, so that the religious values of yesterday relating to wealth may not be necessarily applicable to our world . That, of course, does not mean that religion has no relevance in today’s world – only that religion must be used carefully when applying its general principles to judge the economic life of our times.
The concept of wealth as seen through religion – especially Christianity - is tempered by the belief that all property belongs to God and that we are trustees – and only temporary at that – of God’s property. The purpose of this entrustment on the part of God is not so much for our own personal satisfaction but, rather, for fulfilling God’s purposes such as, for example, helping the poor and the needy. The pursuit of wealth in the ancient world was fraught with potential problems which made it easy to view those who possessed wealth with moral and spiritual skepticism. However, there are recognizably some important differences between ancient and modern economic systems that account for the strong cautions about wealth as they relate to the past.
The ancient economic system was largely centered around agriculture, limited commerce and trade with real estate as the predominant productive asset. More specifically, the pool of economic resources was relatively fixed, so that when one person became wealthy it was usually at the expense of someone else. Such an arrangement, naturally, set up numerous opportunities to attain wealth abusively by theft, taxation, or extortion. One of the most common instances of this abuse in the Roman World, for example, was for those who had resources to loan money to the poor at terms they could not repay, requiring what little land the poor owned as collateral. Then when the debtors inevitably defaulted, the lender appropriated their land. The debtors became tenant farmers or slaves or were reduced to dependence on charity. This form of taking advantage of the poor occurred regularly in the ancient world and is possibly the main reason as to why religion came to so frequently condemn exploitation of the poor. In these cases, literally, the rich became richer at the expense of the poor, and when someone was wealthy, more often than not, they acquired their riches through some immoral means. Thus, the wealthy were viewed with suspicion and great emphasis was placed on the potential temptations of becoming wealthy, because society then had so few morally legitimate avenues to acquire wealth.
This is obviously no longer the absolute case in the Post-Industrial Revolution era. Although it is certainly true that the poor continue to be exploited to a certain extent, we have shifted from a relatively immobile economy to a more versatile, vibrant model where wealth is being created instead of simply being transferred. In our economies of scale where the cost of producing an additional good is less than the good produced before it, every time a company manufactures or otherwise produces a certain good wealth is created, and every time a company sells that certain good that it has produced wealth is being redistributed. This is the main reason as to why, in contemporary society, the rich can become wealthy while at the same time the poor can also be better off.
It follows, therefore, that in a modern market economy wealth is constantly being created, so that it is possible for someone to become wealthy without necessarily succumbing to the temptations about which religion has warned humanity for centuries. Which, therefore, in a certain respect balances the Fear of God religion has instilled in man as it relates to wealth with the possibilities created by the redistribution of the Power of Money.
And which, furthermore, if memory does not falter me is precisely what brought the schism between spiritual and temporal powers and separation of Church and State – only said differently ...
Luigi Frascati
Real Estate Chronicle
