Squeezed - A Review

Even before the Great Recession and the slow climb out of it, many people expressed angst over their economic situation. As long as I can remember, and likely for all of human history, most people have expressed a sense that they can’t get ahead and that true financial stability is just out of reach. One thing that has shifted in the last few generations, however, is that people have argued that having a family is financially out of reach because of their current economic situation.

A desire for economic stability is leading many young people to delay marriage until their late 20s or early 30s. Then, once couples do get married, they often decide to wait to have children “until they can afford it.” The frequent, repeated news articles that tell people it costs a quarter million dollars or more to raise a child tend to entrench such arguments.

In her recent book, Squeezed: Why Our Families Can’t Afford America, Alissa Quart attempts to make these arguments in a book length format. She uses a journalistic-style, with supporting statistics interwoven with sympathetic anecdotes to make her case. The style itself is useful for convincing either (a) non-critical readers or (b) those already convinced. For those skeptical that centralized government solutions like UBI are the best solution for people’s feelings of dis-ease, the content of Quart’s book tends to make quite the opposite case that Quart intends.

There are certainly problems within our current economic system. Some of the cases that Quart outlines help to show what those problems are. For example, the injustice of our broken immigration system is evident in Chapter 5 of Squeezed and, in some ways, represents reality. However, what Quart actually shows is that consumerism is a miserable disease and that, in general, life would get a whole lot better for people if they turned off their televisions, got off the internet, and focused on living the life they can afford and loving the people around them.

A couple of the stories Quart highlights show the main problems with Americans that keep them from feeling they can afford a family are (a) a lack of permanent commitment in marriage and (b) covetousness.

The Damage of Impermanent Marriages

Quart begins the book with her own story. She and her husband were freelance writers living in a rent-controlled apartment in New York City when they had their first child. She describes the burden of paying $1,500 for the medical care she and her daughter incurred during delivery. Subsequently, they experienced “financial vertigo” because, “We first hired a nearly full-time sitter and most of my own take-home earnings as an editor went directly to her. Eventually, my earnings also flowed to my daughter’s cheerfully boho day care . . .” (pg. 3). The financial pressure they felt was primarily self-induced fear of “tumbling out of [their] class position.” (pg. 4) Contributing to this is the apparent sense that one must maintain one’s career even if it is financially unwise to do so.

Though it is not clearly defined, “middle class” in this book appears to be defined as living above your means without fear of financial repercussions. So, for Quart, it was essential for her to be able to fund a nanny so she could retain professional pride and independence from her husband, no matter what the financial burden or social cost to her offspring.

There are several cases throughout this volume that illustrate that fear of being left or getting divorced is what drives a lot of the financial pressure on her subjects. In other words, when a spouse fears that his or her marriage is impermanent and the spouse and their income may disappear at any moment, then there is terrific pressure to maintain a career at any and all costs. Quart does not identify this fear explicitly, but it is an obvious undercurrent throughout the book for those with eyes to see it. This is why the supposed 70% gender pay gap is so insidious in the eyes of many progressives.

If couples both valued and were committed to the permanence of marriage, much of the angst that Quart describes about finding suitable and cost-effective child care would diminish.

Covetousness

The other major problem illustrated by this book is not injustice, but covetousness. This is apparent in Quart’s story again, as she requires a personal baby sitter and then “boho daycare” for her child.

A more striking example of the problem of economic myopia and covetousness is documented in Chapter 2. Quart describes a case of “modest oppression” of a couple who made a combined household income of “around $160,000” as the department chair at a college (wife) and a part-time music composer, director of a music organization, and church organist (husband). Even given the high cost of living in New York City, it is hard to describe a couple making north of $150K as being oppressed in meaningful sense. Apparent in Quart’s description is that their unhappiness was largely due to the existence of people that appeared to be more comfortable and have fewer financial worries. Absent from Quart’s telling of their story is the idea that they might consider making different decisions (e.g., having the husband stay at home with the kids) that might alleviate the problem and result in better outcomes for everyone.

Similarly, in the same chapter Quart tells the story of an adjunct professor whose PhD was in avant garde poetry. She has a disabled son, conceived in a fling with a member of an indie rock group. There are multiple commendable aspects of the story: the adjunct was willing to work hard and she was committed first to not killing her child in utero and then to seeking proper care for him. The covetousness in this story is apparent because the adjunct believed herself to be entitled to the career of her choice––that is to be fully supported through adjuncting––because she had chosen to get an advanced degree in a particular field. There is some hope in this story because the chapter closes noting that Bolin had decided to pursue more regular employment.

Quart’s telling of these stories is intended to illicit the response that there is obvious injustice in the struggle of both of these families. However, it is clear to the casual reader that the greater portion of the financial distress in both these situations is a desire for something that is just out of reach: the idealized existence as a career advancing professional in the exact job one desires. The underlying assumption is that the world owes everyone their personally preferred lifestyle and existence. As long as people base their happiness on hanging on to social positions that are just above their income level or seeking the perfect working situation, their covetousness is destined to enhance their unhappiness.

Positives of the Book

The general premise of Squeezed is flawed, but there is value in the book.

First, there are multiple anecdotes that illustrate how significant the family and community are for financial stability. Though Quart does not draw the conclusion (instead calling for government intervention at nearly every level), it is apparent that stronger nuclear families and mediating institutions like the local church are essential to the flourishing of society. In many of the examples Quart provides, the reader can see how a strong connection to a local congregation that is functioning as the body of Christ could alleviate a great deal of stress.

Second, as noted above, the permanence of marriage tends to alleviate a lot of cost and stress. Both spouses need not pursue their careers full-bore if they trust each other to remain around. Additionally, the cost of living can be substantially reduced when both parents and children live together in the same house.

Third, in Chapter Ten, Quart highlights the work that television (or other versions of video entertainment) does in making people believe they are not well-off. Supposed “middle-class” families in SitComs are really incredibly rich. Everything on the set is in perfect condition, no one is really struggling for money, etc. The old puzzle about how the characters in Friends were able to live such apparently lavish lives in New York City is still a real phenomenon. Part of the work of the Church, then, should be to disabuse people of the fantasies of contemporary entertainment.

Conclusion

Ultimately, this is a popular-level book that will tend to convince the already convinced that a bigger government is needed to fix supposed injustices in the economy. What it really highlights is that much of our ongoing social misery is self-induced. If we readjust our expectations toward reality and focus on enjoying the relative wonders most of us experience on a daily basis, our satisfaction in life is bound to be enhanced.

NOTE: I received a gratis copy of this volume from the publisher with no expectation of a positive review.

Economics of Neighborly Love - A Review

Our economic activity, when done properly, is primarily about loving our neighbors. Neighbor love is not merely a description of so-called spiritual activities, like those done under the umbrella of a local church. Rather, neighbor love should shape everything we do in the home, in the marketplace, and in our neighborhoods.

In a helpful, recent book, Tom Nelson helps bring theology and economics together in a way the average Christian can understand it. His volume, The Economics of Neighborly Love: Investing in Your Community’s Compassion and Capacity, weaves together many of the themes in the Faith and Work movement in a single, digestible bundle.

Nelson’s basic assumption is that we live in a fundamentally economic world. His is not, however, an attempt to reduce humans to homo economicus. Instead, he argues for understanding humans to have the imago Dei, which leads to a demand to live compassionately among others. His basic argument in the entire book is that the best workers make the best neighbors, as long as they are working for reasons that matter.

Humans are made to flourish. Part of that flourishing is having our material needs met. Another component of flourishing is pursuing a purpose higher than ourselves. Work is a primary means by which humans flourish.

One sign of flourishing (though not the only or even best sign) is material wealth. Such wealth is a resource to be stewarded for the glory of God and the good of neighbors. It is neither the reward for holiness as the prosperity gospel argues, nor is it intrinsically evil. It is a simply one way that God provides for humans to be fruitful.

Lest Nelson be guilty of reducing flourishing to the accrual of wealth, he quickly explains that intimacy with other people, godly character, and productively contributing to the world around are vital ways that humans are fruitful. Being fruitful and productive are ways that we love the world around us by making this world a better place.

All of the productivity in the world does not do any good, however, unless it is directed toward our neighbors. Nelson explains a vision, consistent with Scripture, of how godly people can engage in a relatively free market for the glory of God.

One way humans engage wisely in economic activity is to be generous, using our wealth to provide the means for the church to do good works in the name of Christ. Another way is to actively pursue the good of the materially poor around us. In the process of helping the poor, however, a biblically shaped worldview recognizes there are forms of poverty that no amount of material support will resolve. People are desperately need of the gospel, so we are called to demonstrate it through our actions and verbalize it through our language.

As part of our economic activity, Nelson also urges Christians to fight economic injustice, to show grace to the communities around us. Most of all, people simply need to get moving. It is altogether too easy to stay cooped up in our homes, never meeting our neighbors, and thus never learning how best to meet their needs. By making personal connections and seeking the common good in all of our economic activities—not just the ones where we spend and earn—Christians can demonstrate what hope looks like to the world.

The Economics of Neighborly Love is the sort of volume that makes a great introduction to a biblical view on faith, work, and economics. Nelson shows how the ordinary lives of ordinary Christians can be leveraged to make this world a better place for the love of God and the good of our neighbors. He presents a practical vision for Christians to be salt and light in the world.

Perhaps the most important takeaway from this volume is that there is a way for Christians to show neighborly love not despite our economic system, but because of our economic system. Though Nelson recognizes that sometimes sinful people oppress others in a free market economy, he also recognizes that freedom is an important part of allowing people to fulfill their potential as beings imbued with the image of God. The freedom within the market system helps make financial prosperity accessible to many more people, which helps provide the resources for many forms of productive engagement with society.

Nelson’s book, however, will fall short of its final purpose if it fails to encourage Christians to live their lives for the good of the world around them. This is a book that deserves to be read, discussed, and shared widely as the body of Christ seeks to fulfill the greatest commandment by living out the second greatest commandment in a world of people who desperately need to be loved. The Economics of Neighborly Love is a volume that needs to be applied wholeheartedly, too.

Note: I received a gratis copy of this book from the publisher with no expectation of a positive review.

Letter to a Young Farmer - A Review

I was first exposed to Gene Logsdon in the 1990s when my father brought home a book from the library. It was recommended, I believe, by a columnist in the Buffalo News. In At Nature’s Pace, Logsdon presents his idea for the small family farm as a lifestyle and not merely a career choice. That book talks about the economic viability of small farms—particularly horse farms—arguing that success is, perhaps, more likely on a small scale.

21562.jpg

In his recent, and final, book, Letter to a Young Farmer: How to Live Richly without Wealth on the New Garden Farm, Logsdon further develops some of his elegiac essays on the life of a rural farmer with something like an epistolary exhortation to someone who feels irrepressibly drawn to cultivate the earth. This is a collection of essays, with a conversational tone. Just the sort of tone you would expect if you stopped by to visit your aging curmudgeonly neighbor for a few minutes while leaning on his split rail fence. It is, in fact, the sort of book you would expect someone who claims to be a “contrary farmer” to write as a swan song. Logsdon has recently died and this book represents something of a last will and testament for the folks he’s been writing for during the past half century.

Logsdon’s writing style is comfortable and enjoyable to read. He adds a good dose of facts and figures, with a dash of common sense, and a large dollop of opinions. The mixture that results enables the reader to politely disagree at points while still enjoying the experience and getting some helpful information along the way.

Letter to a Young Farmer is not an extended argument, but a series of discussions that surround a cogent theme. This makes the book an easy one to read piecemeal over the course of several weeks or even months. There are essays about managing the politics and economics of a farmer’s market, about the uses and failures of big data, and about the joy of living in one local area for most of one’s life.

The central topic in all of the essays is how to make a go of it as a small farmer. Thus, the subtitle is more descriptive of the content than the title. Logsdon is not writing to the person who inherited a vast tract of land and is putting thousands of acres under plow. Neither is he writing to someone who is necessarily chronologically young. Instead, Logsdon is writing to someone who has decided to engage in agriculture on a small scale—often for the fulfillment of the act itself—who lacks the benefit of his decades of contrarian experience.

Some of Logsdon’s earlier books make is sound like the small farm is the only way to go. This book, however, is more balanced. Logsdon acknowledges that there are many ways to farm and many reasons to farm. Though he still acts as an apologist for the small, “garden” farm, he does not come of a polemical in this book as before. Just persistently contrarian.

Most of the wisdom in Letters to a Young Farmer represents the sort of common sense that seems so uncommon today. He argues that young farmers should avoid debt, diversify assets and income sources, save for the future, avoid social vices like smoking and drinking (they are exorbitantly expensive), minimize eating out and the purchase of non-essentials, build trustworthy relationships with mechanics and other service providers, live in a reasonable house, and so on. These lessons are essential for someone trying to build up a new garden farm, but they are equally useful for those who live in the suburbs—so much of the angst of the modern worker is due to grasping for a lifestyle that has been advertised on television.

The moral of the book, so to speak, is that life is much better when you live within your means and pursue contentment in the place you are. For Logsdon and many of his readers, this translates to finding satisfaction in farming 10, 50, or 200 acres. Often it means being content to do so while working another job, whether full-time or part-time. This is a book that marries up the idea of a sense of vocation with the sense of place.

Even if you aren’t a garden farmer—as I am not—this is an enjoyable book. Logsdon—a lapsed Roman Catholic—is somewhat caustic about the value and durability of Christianity, but if you filter his occasional snide remarks, what you have is a collection of essays that are a pleasure to read on a cold winter evening. The end result may well be a deeper appreciation for where you are, what you do, and perhaps a growing desire to plant a decent sized vegetable garden in your backyard.

NOTE: I received a gratis copy of this volume from the publisher with no expectation of a positive review.

Economics in One Lesson

If I could recommend one book for everyone to read to grasp the connection between economics and public policy, it would be Henry Hazlitt’s volume, Economics in One Lesson. It offers a basic, accessible explanation of why so many attempts to regulate the economy don’t work. Though laws are certainly necessary, the failure of many laws is due to a focus on the legislature’s immediate intentions rather than the long term impact of the proposed policy.

Though the book is not a theology of economics, its main thrust resonates with scriptural principles. The reader does not have to agree with all of Hazlitt’s policy preferences to recognize the value of his long-term view of the universal good and see how they help fulfill authentic justice.

Hazlitt’s One Lesson goes like this:

“The art of economics 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.”

Basically, Hazlitt’s lesson boils down to two principles: 1) thinking about the long term good instead of the short term good and 2) taking everyone’s good into consideration. Both of these principles resonate with Scripture.

First, let’s look at taking the long view on economic decisions:

Some advocates of so-called social justice, including some Christians, argue that immediate action to change significant economic policies in order to provide a rapid solution to a perceived economic problem is necessary. In many of these cases, however, the long term impacts of the new policies are not fully considered.

Looking for long term consequences instead of focusing on short term effects is biblical.

For example, Proverbs 21:5 states: “The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to poverty.” (ESV)

Interpreting Proverbs is a bit tricky since they are not absolute, universal laws, but general truths that may have apparent exceptions. However, without pushing this text beyond its primary meaning, it is clear that long term planning is being lauded by the author of this proverb.

download (11).jpeg

For another example, consider Luke 14:28–30: “ For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it? Otherwise, when he has laid a foundation and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish.’” (ESV)

The context of these verses is about the cost of discipleship, but Jesus is urging his audience to consider the long term costs of their discipleship, not just the apparent immediate benefit. That Christ uses an economic example to illustrate his spiritual point demonstrates the validity of the economic principle.

Second, the concept of the good of all, not just a favored group, should be considered:

Some Christians try to argue that social structures should be preferential toward the poor or others who have real or perceived disadvantages. For example, in the minds of some activists, social justice requires progressive taxation and redistribution of wealth in order to benefit the poor. The rising tide of socialism among the “young and woke” crowd seeks to confiscate and redistribute wealth according to their desired social order, which is intentionally designed to harm the rich (or those that they choose to label as such).

The Bible, on the other hand, indicates that social structures should be oriented toward even-handed justice. Consider Exodus 23:2–3: “You shall not fall in with the many to do evil, nor shall you bear witness in a lawsuit, siding with the many, so as to pervert justice, nor shall you be partial to a poor man in his lawsuit.” (ESV)

The passage then goes on to explain that you can’t passively ignore the good of your enemy by failing to return his lost property (vv. 4–5), that you should not lean toward the benefit of the rich against the poor in seeking justice (v. 6–8), and that the sojourner, the foreigner in your midst, should not be oppressed. Justice is the main theme.

As a second example, consider Proverbs 22:16: “Whoever oppresses the poor to increase his own wealth, or gives to the rich, will only come to poverty.” (ESV)

It is apparent that manipulating social structures for the benefit of a special interest group is not a path for universal justice. This means that creating a system that benefits the rich is bad (and this is a major danger of our current system of crony capitalism), but that attempting to punish the rich through taxation (as socialism tends to do) is also evil.

The basic thrust of these passages is that social systems, including economic systems, should be oriented toward even-handed justice.

Though more could be said about Hazlitt’s One Lesson, I have come to the conclusion that there is warrant for claiming that Hazlitt’s principles resonate with biblical justice. His examples help show why some of the well-intentioned policies proposed by so-called social justice advocates are really detrimental to a holistic system of justice.

It is important, therefore, that we begin to seek a system that does not intentionally harm one group for the benefit of another and that we look at long term consequences, including systemic incentives created by social programs or convoluted tax systems. Only when we begin to ask these important questions will we be able to find legitimate answers to them.

Toxic Inequality - A Review

In the last decade or so, economic discourse on the left has begun to focus on inequality rather than poverty alleviation. Thomas Shapiro’s recent book, Toxic Inequality: How America’s Wealth Gap Destroys Mobility, Deepens the Racial Divide, and Threatens Our Future, explores that theme. Analysis like that in Shapiro’s volume relies on catching people at the stage after the Great Recession before they had fully recovered and blaming their lot on insufficiency of government regulation. Books like this do well for their cause to claim a crisis for their advantage.

51N71QJlUEL._SX327_BO1,204,203,200_.jpg

There are basic ideas that Shapiro relies upon that are flawed. He speaks of “tax expenditures” when dealing with exemptions, cuts, and other deductions in the tax code. This is indicative of an underlying assumption that the state is the primary owner of all property and has the right to determine who should get to keep it or not. He also simply assumes that inequality is fundamentally immoral, which he makes no effort to defend.

Despite these assumptions, the book does highlight problems that deserve common concern, even if the solutions differ from those that are likely to be successful in the long run. The fundamental problem is not that rich people have too much, but that the poor are significantly disadvantaged by their poverty. The poor are, in many cases, cut off from adequate (there will never be equal) opportunity to flourish merely because of their poverty.

That should raise concerns among people across the political spectrum. Some of the case studies that Shapiro highlights reflect the logical outcomes of choices made by the subjects of the study. There are several instances that his subjects made irrational decisions and reaped the whirlwind during the financial crisis. However, there are many more cases where circumstances beyond the control of the individual or family drove negative outcomes or closed doors.

Shapiro’s book emphasizes the ongoing changes in the job market, which should be a significant concern to us all. Upper and lower skill jobs are increasing in number while middle skill jobs are largely being outsourced or automated. This is creating a narrower window for people to climb the social ladder, as the gap between low and high skill often involves a significant capital investment for a college education. This represents a challenge our factory-style schools need to adapt to, but also one which lower income, lower funding districts will increasing have difficulty overcoming.

The data in this book is sound and points toward the need for meaningful action on the part of society to seek to increase opportunities for success for those on the bottom end of the financial spectrum and their children. Some of the means that Shapiro suggests to solve the dilemma are likely to lead to worse conditions and be financially unsustainable. For example, Shapiro argues for the creation of make-work jobs by the government designed to inspire full employment. He also argues for increasing the already often unsustainable defined benefit pension plans, like those offered by many municipalities. Additionally, increasing the ability for unions to force people to join is a proposed solution. This assumes that unions always use their dues well, represent the interests of their members effectively, and facilitate authentic human flourishing. In short, many of Shapiro’s suggestions are more likely to exacerbate the negative attributes of our present economy, though they are well-intentioned.

Although the solutions are questionable, Shapiro reveals are real societal problems that need to be addressed. These are just the sorts of issues Ben Sasse was attempting to address in his recent book, The Vanishing American Adult. This conversation needs to continue as we work together across political lines to address the significant problem of the dissociative impact of poverty in our society.

The Road to Serfdom - A Review

One sign of a classic book is that the critiques it offers remain valid for years after being penned. F. A. Hayek’s famous book, The Road to Serfdom, demonstrates that quality. As the battle continues to rage between advocates of free market systems and various forms of socialism, Hayek’s diagnosis of the likely end of directed economic systems—namely, tyranny—illustrates why advocates of markets have not simply rolled over and played dead, despite the economic and social realities of economic problems.

41Cjd718ofL._SX331_BO1,204,203,200_.jpg

Another sign of a classic book is that it has explanatory power and offers brief summaries that could have been expanded to book length treatises. The Road to Serfdom contains dozens of examples of succinct statement of a deep, complex economic and social problems that arise from attempts to plan the economy.

The book, overall, is a masterpiece that deserves to be read and that contemporary supporters of socialism should be forced to reckon with. A few points, however, arise from the wider tapestry of the work that deserve especial note.

First, contrary to popular representations that attempt to associate free markets to National Socialism, Hayek shows that the fascism promoted by the Nazi’s was an exacerbation of the socialist ideals that had been embedded in German society for several generations rather than a market response. This, of course, violates Godwin’s Law by invoking the Nazis. However, to be fair, the volume was written during World War II. However, the close connection between the totalitarianism of Nazism, much like Italian fascism and Stalinist communism, is a significant point of the entire volume. Attempts to plan the economy centrally lead to tyranny of various degrees.

Second, Hayek is careful to differentiate the welfare state from economic socialism. He actually lauds the work of the British safety net in helping to ensure the basic needs of people are met when they are out of work. At the same time, he cautions against welfare efforts that that undermine the market.

An element that is missing from Hayek is a discussion of why liberty is a worthy end. That is, after all, the great advantage he lauds in the market system. Despite its inequities, the market system enables a greater freedom of choice for people. He argues for individualism, which is not quite the bogeyman contemporary opponents of markets make it out to be, but an effort to value the individual and to assert the rights of the individual even amidst the collective. Because of this lack, this work by Hayek is open to criticism that it can result in atomistic selfishness, but there are answers that are implied by the context. Hayek represents there are limits to human freedom, which should be enshrined in law. He is, therefore, not arguing for a Randian version of anarcho-capitalism. Hayek also recognizes there are externalities (like pollution) that may need to be regulated apart from market influences.

In short, despite the lack of explicit reasoning about certain moral assumptions, the market economy that Hayek lauds in this text is a far cry from the strawman constructed by many of capitalism’s critics. It is also quite a distance from the dangerous individualistic vision of market participation that is offered by some of the free markets popular supporters. There is a moral thickness to Hayek that, while still falling short of biblical adequacy, represents a better foundation than many, both supporters and detractors, assume.

A strength of the text is that Hayek shows that good intentions in economic planning do not make up for the inability of humans to adequately plan. The range of social goods that are valued by different people make it impossible for central planners to prioritized the preferred goods of the population, since there will always be competition between those goods. The priority of goods must, therefore, be imposed rather than derived and will thus lead to the constraint of reasonable and warranted freedoms of many to meet the goods of the empowered few planners.

Here again, the lack of an ethical consensus that can drive the social action of the planners reveals that economic reasoning is second order. That is, moral virtue must precede the economic system. Any economic system is doomed to reveal the moral failings of its constituent members. Hayek’s argument and historical economic evidence reveals that markets have the best internal mechanism for mitigating vices apart from centralized planning. Still, a market driven by an immoral people will merely enlarge their immoralities. There is, perhaps, greater danger in enforcing evil as an intended “good” in collectivist economics that makes the ability in a market system of to refuse to participate in immorality preferable.

Hayek also reveals that today’s arguments that “socialism must be implemented because of impending doom” is nothing new. There is nothing new under the sun. Human nature is consistent in any economic system. Our task is to work toward the best possible system of economics that will encourage human flourishing. There are many who believe, as Hayek does, that free markets tend to do that better than various forms of collectivist economics.

The Conservative Heart - A Review

The term “conservative” has taken significant hits to its credibility in the last few years as it has become identified with many things that, when examined truthfully, are not either not worth conserving or, in fact, romantic idealizations of something that never really existed. It does not help that in the American two party system “liberalism” has been claimed by Democrats on the left, which naturally leaves the opposite of that to become Republican “conservatism.”

Perhaps with a wink and a nod, we can assume that Republicans still represent something akin to fiscal conservatism (though that is highly in doubt given the most recent budget proposal). However, accepting there is a higher likelihood of fiscal conservatism on the right than the left, that leaves Republicans as the killjoys of the welfare state, more often presenting lectures on the economic infeasibility of radical redistributionism than a vision for the good of the nation. It is in the latter that a true conservatism would reside.

Arthur Brooks seeks to recapture and rehabilitate true conservatism in his book, The Conservative Heart. Among thoughtful conservatives, there is a strong desire to pursue human flourishing broadly. In fact, the vision of truth, beauty, and goodness is at the very center of traditional conservatism.

Many contemporary conservatives have lost their way and become drawn into merely not being socially progress and fiscally irresponsible. However, when your greatest argument is an appeal to the cultural sentiments of the 1950s (which were pretty hellish for people of color in these here United States) and a bunch of charts and figures that reveal the inevitable demise of a culture that is rampantly financially irresponsible, you will rapidly lose your audience.

Brooks is arguing that true conservatives need to work to regain a holistic vision of human flourishing that builds on economic reality, but focuses on a virtuous ideal of mutual flourishing of everyone in society. That is, he is arguing that conservatives reveal their heart for the well-being of all citizens our world, especially those who are at the bottom end of the economic scale.

Like most advocates of market economics, Brooks sees individual pursuit of happiness with enrichment of the common good. He addresses the futility of our current spending on welfare, but, to be clear, he favors a robust safety net. However, he argues the conservative vision for a social safety net should emphasize equipping to get out of poverty. Too often, social assistance has been structured in ways that make it difficult. At the same time, some on the political right have begun to see attacking the down and out as a winning strategy (on the left they insult “guns and religions” of the “deplorables”); this needs to be rejected by true conservatives.

Instead, Brooks argues conservatives ought to work to make work meaningful and readily accessible.  We should discuss our vision for easy access to markets, especially for the poorest of the poor. This includes rolling back unnecessary protectionist laws that are designed to disadvantage need entrants into the market; it is the poor who often lack the resources to get licenses required for jobs they often have the skills to perform. Enabling economic participation is a better path to social justice than pure redistribution: it both assists and ennobles; conservatives have that vision in their past and need to make it happen.

Ultimately, Brooks is arguing that conservatives lack vision and spend too little time communicating the bits of vision they actually have. In some ways, self-styled conservatives need to change their positions to be more consistent with their historic roots. In many other way, the same people need to spend more time working and speaking for positive outcomes rather than heaving rocks across the aisle for the people who have often captured the hearts of the needy, but have a deficient plan to assist them.

Brooks is a winsome communicator who consistently believes the very important ideas that there is a true, good, and beautiful that conservatives should be pursuing. He actually wants to see lives improve and the world made a better place, which is different than the common partisan quest for power. In short, the ideas of this book represent some of the best aspects of conservatism and provide some practical steps for real, principled conservatives to step up and begin to make changes for the better.

Note: I received a gratis copy of this volume with no expectation of a positive review.

Just Capitalism - A Review

A lot of public debate about economics deals in caricature, particularly of capitalism. Critics of markets tend to argue that it is fundamentally unjust and based primarily on greed.

Some beneficiaries of capitalism tend to sheepishly agree with the injustice of the system but either shrug their shoulders because they feel they can’t change it or support it anyway because they like the prosperity that comes through the market system.

Brent Waters takes a significantly different approach. He writes,

My principal contention is that globalization is the only credible means at present for alleviating poverty on a global scale. Consequently, a well-ordered global capitalism is compatible with such core convictions as the preferential option for the poor and promoting human flourishing. To be naively anticapitalism is thereby to effective opt against the poor and diminish human flourishing. Therefore, an ethic of globalization necessarily entails a defense of capitalism.

This is, in fact, why I am pro-markets and anti-socialism. No economic system is perfect because they all involve imperfect, sinful humans. The free market economic system will not prevent all human suffering; however, it has proven to be a better tool to alleviating human suffering than various attempts at socialism.

Summary

Waters argues his thesis in two parts. The first five chapters of the volume outline the necessity of exchange and the place of Christians to argue for market systems. His first chapter summaries some of the historical arguments about wealth and poverty. Chapter Two defines what Waters means by markets and argues for the good in competition and cooperation that are necessary for a market economic system. In the third chapter, the author addresses the topic of creative destruction, the relationship of markets to governance, and an argument that markets represent the best means for improving human flourishing on a broad scale. Chapter Four makes a case for the good of affluence as a pathway to flourishing. The fifth chapter, which closes out the first part of the book, makes the case that affluence is the best means of eradicating poverty on a wide scale.

Part Two of Just Capitalism builds on the general affirmation of free markets, as offered in the first part, but critiques the failures in most current forms of capitalism.  The upshot of the last five chapters is that free markets without virtuous people engaged in exchange are no less evil than socialism. In Chapter Six, Waters argues that exchange is necessary for human flourishing, but it must be oriented toward that end rather than simply focusing on increasing one’s economic status. The seventh chapter shows that for markets to achieve their purpose, they must function within the context of a civil society with the purpose of sharing the goods of creation. Chapter Eight offers some provisional thoughts on possible relationships between a free, civil society that enables exchange with political orderings that prevent abuse. The ninth chapter fleshes out the concepts of freedom and justice, making an implicit case about the differences between positive and negative rights and their relationship with justice. Chapter Ten functions as a conclusion, where Waters draws together the threads of his earlier arguments to further emphasize the good that global capitalism can do to alleviate poverty.

Analysis and Conclusion

Waters is clearly not arguing that every instance of capitalism is good. Neither is he arguing that the present instantiation of global capitalism has no flaws. Many contemporary critics of global capitalism assume that the abuses that arise within existing markets are necessarily a feature and not a bug of the system. On the other hand, some proponents for markets insufficiently critique the sin that is evidenced in current markets and often make a similar assumption that some of the worst aspects of global capitalism are a necessary evil.

This book challenges assumptions on both sides. Economic systems are not inherently unjust or just. However, Waters carefully argues that free markets have a higher probability in resulting in just outcomes due to the self-corrective nature of the market system. At the same time, simply accepting capitalism without working to morally form the members of the market will lead to exclusion of potential market contributors due to social injustices. Waters’ book explains that markets can be good, but we have to work at keeping them moral.

This is the best moral case for the free market economic system that I have seen. There are points where one can disagree with Waters, but he realistically examines the benefits and risks of capitalism, showing that in the balance global capitalism is the best means of alleviating poverty.

Just Capitalism
$31.70
By Brent Waters

Note: I received a gratis copy of this volume from the publisher with no expectation of a positive review. The above link is an affiliate link.

Is Governance Apart from Government Possible?

How much government is sufficient? What sort of governance is appropriate?

Contrary to popular belief, the common view even among free market advocates is that some government is good. Most people argue government is necessary to enforce contracts, ensure market participants act in good faith, maintain law and order in the street, etc.

Edward Stringham’s recent book, Private Governance: Creating Order in Economic and Social Life, seeks to upend that common view. What he ends with is a thesis that points toward valuing and celebrating private governance, which is an idea vastly different that anarchy.

Summary

The book is divided into three uneven parts. Part One consists of three chapters that explain what private governance is and why it is often preferable to government. Part Two contains eight chapters in which Stringham walks through historical and modern examples of private governance in action. Part Three has three chapters attempting to summarize the lessons learned about private governance from the previous eleven chapters.

As Stringham outlines in his introduction, “Private Governance describes some of the major mechanisms that private parties use to produce social order and highlights how modern markets would not be possible without them.” Basically, he is describing the reality that the government cannot effectively regulate the market, no matter how hard it tries. That, however, is something entirely different than saying the market is unregulated.

The “legal centralist” view, as Stringham calls it posits the law as a sort of Deus ex machina that can step in to settle disputes, enforce contracts, and make everything go just right. Even among free market advocates, there is still a strong acceptance of legal centralism.

Instead, Stringam argues, club rules are both more effective, more fair, and more likely to result in mutually acceptable outcomes. Voluntary associations, which are a bedrock of a free society, are typically more effective in governing because they tend to be interested in overall success, not merely seeking self-justification or simply unconcerned for the outcome as much of the government can be.

This is a bold thesis, so Stringham provides a number of case studies to illustrate when private governance worked well in the absence of legal support. The most startling example is of the world’s first stock market, which was founded in the early 17th century in Amsterdam. The early market had a wide range of securities with contracts that the government expressly refused to enforce. And yet stock in the East India Company and other ventures were traded successfully between willing market participants. New derivative forms of stock were invented and futures contracts arranged, all without legal enforcement.

Similarly, the London Stock Exchange arose as a club designed to self-regulate to ensure fair play among its members. Because access to the market was not guaranteed, it encouraged right dealing. So, Stringham is showing, it isn’t that there was no governance, it is that the governance came from non-legal, club-style regulations.

Self-governance led to the creation of mandatory reporting requirements and audit requirements in some stock exchanges. However, those who were willing to accept more risk could form different privately regulated exchanges that managed risks less rigorously.

Stringham provides several other very interesting examples where, undeniably, private governance worked more effectively that legal structures could have. He recounts how PayPal uses private governance to ensure good faith on the vast majority of transactions; transactions that are too small to make legal recourse worthwhile. He recounts the successful use of private police forces in San Francisco when the government was unable or unwilling to deal with threats. He also spends a chapter talking about self-governance, which can be more successful than we allow often simply because of common grace. Stringham spends a chapter outlining the role and benefits of arbitration. He also helps to explain how private governance actually helped mitigate the 2008 financial crisis and how government action significantly contributed to the problems.

Whether you accept his final thesis or not, the examples he provides all illustrate the possibility of significant, complex forms of private governance that help markets and the people who engage in them flourish.

In the last few chapters, Stringham seeks to show how government strips away agency from the customer by intruding in the relationship between the customer and the company. He argues that more often than most acknowledge, governments cross over the threshold from helping to hurting those in the market. Surprisingly, he applies his thesis to the economic philosophy of Hayek and argues that Hayek was too strongly reliant upon government to regulate the market. Stringham concludes the book with an appeal to continue to value private governance, to argue for it, and to seek to reduce imperial entanglements in the market as much as possible.

Analysis and Conclusion

Stringham’s thesis is thought provoking. He argues it well and provides a number of case studies that illustrate clearly how private governance succeeded when most people would expect it to fail. While he didn’t pull me all the way into his camp in eschewing reliance on government enforcement, he does provide a great deal to reflect upon.

Significantly, it isn’t clear that Stringham adequately considers that lack of parity between customers and many corporations. For example, mandatory arbitration clauses are now included in many contracts as a standard feature. So, for example, customers defrauded by Wells Fargo’s malicious creation of accounts on their behalf were prohibited from legal action because of an arbitration clause. When there are no other legitimate options (most banks use some form of this clause), it creates a situation where the customer gets a far worse deal by some accounts. There is more to deal with on this topic, so I hope to conversation continues in the future.

Private Governance: Creating Order in Economic and Social Life
$34.48
By Edward Peter Stringham, Edward P. Stringham, Edward Stringham

Note: I was given a gratis copy of this volume with no expectation of a positive review.

Basic Economics - A Review

Thomas Sowell recently announced his retirement from writing regular columns. As an advocate of realistic economics with a free market emphasis who dealt with facts rather than political talking points, his common sense approach that relies on economic realities rather than wishful thinking made him a helpful voice in contemporary economic discussions.

Having just finished reading the fifth edition of Sowell’s Basic Economics: A Common Sense Guide to the Economy, I would advocate that this book be read widely. For those unschooled in economics (or who haven’t read anything about it since High School), I would recommend beginning with Henry Hazlitt’s Economics in One Lesson, followed closely by Gwartney and Stroup’s Common Sense Economics. Those books are helpful because they are much shorter and even more basic than Basic Economics, but Sowell’s volume belongs on the reading list because it more closely follows the syllabus of a basic economics course and is thus more comprehensive.

As an economics textbook, Basic Economics does not differentiate itself by having a unique table of contents. Sowell covers prices and markets, industry and commerce, work and pay, time and risk, national economics, international economics, and some select special economic issues. This is little different than any other college level text.

Sowell distinguishes his volume in three ways:

(1)      There are no equations in this volume. Even my high school economics course (which was a while ago) included graphs and equations that were supposed to demonstrate the validity of what the author(s) were writing. However, Sowell is not equipping his readers to become economists, but to become economically literate. For some who learn better through visual representation, the absence of graphs may make this book a bit less helpful.

(2)      To compensate for the absence of graphs, Sowell includes a multitude of plain language, everyday examples to illustrate the principles he is describing. Given the number of examples and the basic connections he makes with every day concepts, the absence of graphs and equations is well compensated for. Rather than leaving the concept in the abstract, Sowell makes the effort to give concrete examples, which helps convey the message more clearly than other texts I have read.

(3)      Sowell’s Basic Economics is written largely in plain language. Certainly there are terms that have particular meanings that Sowell takes pains to define. However, the number of those terms is small. This is a book that, despite its impressive length, is intended to communicate economic reality to an audience that is not familiar with the terms. Sowell does quite well in writing so that even a theologian or an ethicist with little training in economics can understand the concepts.

These distinctions make Sowell’s book a great way for non-economists to learn about the principles that undergird financial systems, markets, and political decisions related to the economy.

As the number of advocates for socialism rise, having people that understand economics and why socialist systems inevitably collapse will be increasingly necessary. Sowell provides the tools that help the reader understand why rent control creates housing shortages, minimum wage hikes keep low skilled workers unemployed and impoverished, and general attempts to establish government control of markets tend to have deleterious effects in the long term on everyone. These aren’t political statements as much as evidential arguments from historical data. Sowell’s book helps to provide a framework and language so that everyday people can understand why government interference in markets tend to make things worse.

Basic Economics is a book for our times. It is somewhat imposing with over 600 pages of content, but there’s a lot to talk about. The chapters are fairly evenly divided with enough headings and subheadings that the book is readable in short sittings. And this is a book that deserves to be read.

Basic Economics
$27.19
By Thomas Sowell