<> Presentation to begin a discussion on the Global financial Crisis; to the ‘God Talk’ series at the the Cathedral Church of St Peters, Hamilton Cathedral, May 3, 2009.
<>Keywords: History of Ideas, Methodology & Philosophy; Macroeconomics & Money;
<>I thought context for this evening’s discussion would be a biblical text – verses 6 to 10 of chapter 6 of the first pastoral epistle from Paul to Timothy
<>6: But godliness with contentment is great gain.
7: For we brought nothing into this world, and it is certain we can carry nothing out.
8: And having food and raiment let us be therewith content.
9: But they that will be rich fall into temptation and a snare, and into many foolish and hurtful lusts, which drown men in destruction and perdition.
10: For the love of money is the root of all evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows. <> <>The last verse is often misquoted as ‘money is the root of all evil’. The difference is important. Paul is not ruing out that money may be a useful part of an economy and society, a means to an end. The evil arises when it becomes an end in itself. <> <>Money is, of course, vital for a modern economy, because a medium of exchange makes specialisation possible. Without money, exchange would depend upon barter and a coincidence of wants. Without it we would have to be largely self-sufficient in our production and consumption; our standard of living would be much lower. <> <>There is a difference between money today and two millennia ago. In those days the money was – in the jargon – ‘fully backed’. Its coins were made of metal equal to their face value. Thus the denarius of the bible was made of silver – it was a day’s pay for a labourer. We have since realised that the material content of a coin – or even more so a note – need not be equal to its face value. What is required is that the community trusts that the money will be valued at its face value – thus saving the use of gold and silver and copper in the coin. Ultimately, a currency’s value is that the government will accept it in payment of taxes – giving an unexpected meaning to ‘Render unto Caesar the things which are Caesar’s.’ <> <>While the monetary system works is a complicated story, the epistle’s direct message is that while money may be an integral part of a complex economy, it should not be an end in itself. <> <>It is not a great stretch of Paul’s meaning to replace the term ‘money’ with ‘wealth’. The epistle says we need sufficient to live with, but if we pursue wealth after that sufficiency we tread a path of destruction and perdition. That is not a bad description of what has increasingly happened in recent years. Instead of using money as a means to help attain a sufficiency, it has become an end in itself. <> <>What strikes one about the bonuses that those in financial systems paid themselves is that they could not possibly spend them. A million dollar bonus was not unusual – what an unskilled worker earns in a lifetime. <>Those with such wealth thought it somehow indicated that they were of greater value, ignoring the epistle’s cautions. To display their wealth they practised conspicuous consumption, the lavish spending on goods and services acquired mainly for the purpose of displaying their wealth in order to achieve a social status – not just on food and raiments. <> <>The strategy succeeded. We attribute to them desirable characteristics such as wisdom, beauty, intelligence and virtue which would not be evident, were they ordinary citizens. We rarely mentioned that their achievement certainly had an element of luck, and that they may have – as the epistle says – gained their goals in ungodly ways. <> <>This cult of the pursuit of monetary wealth and its accompanying driver of greed has become the religion of the modern capitalist state, peaking in those extraordinary bonuses and the power and deference which were given to the captains of finance. As it unwinds we know not where we are going. We may be on a path of destruction and perdition, <> <>The ‘we’ is not just the rich, insofar as others honour the goals of the rich, even if they cannot attain them. The entire society has adopted monetary goals as appropriate social goals – consider the demand that we should accelerate the economic growth rate to join the top half of the OECD. That is not what Paul is counselling Timothy as the way to godliness. <> <>We face one of those moments in history where there are doubts about the path we are on. It is not simply a moment in economic history, as the world economy goes into what may be the worst experience it has ever had. It is not just a matter of technicians worrying about how to fix it, while the rest worry about what will happen to them. <> <>It is also, potentially, a moment of an ethical crisis, one which two millennia ago we were warned against. While we have had vigorous ethical disputes, they have rarely touched on the economic system, other than concerns about the poor. What is the purpose of an economy, is rarely addressed. Is money a mean to an ends or the end itself? By not addressing such questions we implicitly answer that what the economy is doing broadly meets our approval. Would it have met Paul’s approval? <> <>If we treat the Global Financial Crisis as merely a technical one, we will, I’m afraid, once more fail the ethical challenge. The crisis is not just a matter of having pierced ourselves through with many sorrows. As Paul cautioned Timothy, we have erred from the faith – of what is really important about being a human. <> <>Go to top