February 7, 2014

Calvinist International and its “Third Way” Economics

By In Articles, Economics

In 1996, former Ron Paul Chief of Staff John W. Robbins (died in 2008), founder of the Trinity Foundation, wrote an essay called “The Reformed Assault of Capitalism.”  It was later published in his collection of essays called “Freedom and Capitalism.”  In this essay, the very Reformed Robbins took aim at the rising socialist economics influence at Calvin College.  Specifically, he gave an overview of the economics textbook that was being used during that time (I am not sure what they use now): Through the Eye of a Needle: Readings on Stewardship and Justice.  Robbins, as he was known so well for doing, lambasted the book as “socialist propaganda” and stated affirmatively:

Unlike even the mainstream textbooks, this book is a sustained attack on economic and political freedom.  It is a totalitarian and socialist tract, written with religious fervor by admirers of serfdom and the Dark Ages.

Later in the essay, he writes that the economics in this book should not be considered “Christian economics::

Far from being Christian, it is a good example of what even the atheist Ludwig von Mises recognized as “statolatry,” the idolatrous worship of the state.

Harsh words indeed, but any one who knows Robbins’ work knows that this is his style.  His point though was that in Reformed and Calvinist circles there was a brewing tendency to reject the Capitalism that people such as Robbins and more eminent figures such as Max Weber and Gottfried Dietz (under whom Robbins learned at John Hopkins University) show was founded in the Protestant tradition.  Robbins laments that fact that an institution sitting in the Reformed tradition can be so anti-political and economic liberty.

But it seems that for the Reformed Libertarian, that is, the Christian who is a Calvinist and a proponent of political and economic individual liberty, there is always more about which to lament.  The collectivist influence on the protestant church is alive and well. Enter Calvinist International.  A quick perusal of the site produced some immediate understanding of who they were and what they believed.  In their about section, they refer to themselves first as “Reformed Catholics,” and then more definitively under the name of “Reformed Irenicism.”  The influence of Catholic social and collectivist teaching is apparent everywhere on this site and there are many reasons that the Calvinist should be hesitant about its viewpoints.  But this blatant Irenicism makes it clear that their “Protestantism” is of a different cultural and political flavor than the Old Princeton/American Puritan tradition which influences TRL.

They are anti-capitalistic.  They heavily support, and often cite, Allan Carlson’s Third Ways.  This book, as the previously linked review indicates, is both an overview of “third way” movements and also an introduction to the idea that there are historic alternatives to the present capitalist/socialist divide.  The reviewer, who is also the founder of the site, writes of the book:

[Carlson] is simply trying to introduce a mostly unfamiliar audience to the possibility of alternatives to the late capitalist system.

In other words, “third way” refers to the quest to find a better system than capitalism and socialism.  Of course, we would raise our hand to ask: what “late” capitalist system?  The quasi-capitalism that died almost 150 years ago at the birth of American fascism?  Because if so, why are we referring to quasi-capitalism as capitalism?  I suspect though that people like this assume that the later twentieth century was proof of capitalist failure.  All the while Murray Rothbard and Ludwig von Mises were deriding the the United States for its socialism.

So what is wrong with Capitalism?  Is not Capitalism the system consistent with private property and individual human action?  Calvinist International and the Carlson disagree.  There are allegedly six flaws in “modern” capitalism.  What constitutes “modern” and what, exactly, are we comparing it to?  Regardless, below are the “six flaws” with some of my comments below them.

1. “Laissez-faire Capitalism rests on a distorted understanding of human nature”

This is a typical argument.  The first response is this: the idea that depraved humans acting in a role of coercive government power can be a deterrent to any evil that might arise on the market is self-contradictory.  “Power corrupts” and people in the role of government produce hundreds of times more evil than entrepreneurs in the free market.  Secondly, it assumes that the depravity of mankind means that people on the free market will necessarily seek to harm others.  But not only is this not what total depravity refers to, it is also ludicrous by the very nature of the market.  The market is where, in order to profit, one must first serve and satisfy his customer.  If anything, such interaction restrains the depravity of man.  It is no coindidence that in this age of the largest governments in history, there is also the most violence, civil unrest, and mass terror.

2. Despite claims to the contrary, the spread of capitalism has depended on forced centralization and the power of the modern state for its effective operation

This makes no sense because by definition “forced centralization” eliminates the presence of capitalism.  If capitalism refers to the growth of the economy via heterogeneous capital (as the Austrians describe it), how can a squelching of the economy by government power grabs spread capitalism?  Furthermore the “power of the modern state” is that very institution which stands antithetical to the “effective operation” of capitalism and it is therefore the main object of the libertarian complaint.  Eliminate the power of the modern state and let capitalism work!

3. Capitalism undermines true economic liberty and democracy

Using words without mentioning their definition is a dangerous thing.  What does democracy mean?  Is he referring to it in the Misesian sense (the free market is democratic because via the price system, all people can choose exactly what they want) or the political sense (majority rule and lobbyist influence of the majority to slap a one-size-fits-all solution to the entire nation)?  And what does liberty mean in his context here?  It is difficult to converse without definition.  In fact, without definitions, there is no proper way to offer a response at all.  But it is simple to point out that our view is that capitalism is naturally arising result of true economic liberty.

4. Modern laissez-faire capitalism thrives by embracing and promoting the deadly sins: wrath, greed, sloth, pride, lust, envy, and gluttony

This is laughable.  All these things (by the way, way to throw in Catholic doctrine of sins that have no justification to be called “The Deadly” ones –all sins are worthy of death) have nothing whatsoever to do with capitalism, modern or otherwise.  And second, would his “third way” solution to capitalism eradicate these sins from humans?  No!  Look, if I take my grain and trade it for my neighbor’s bike because I see it as an economic benefit, which sin could this possibly be?  These sins exist independently of the economic system and the individual is responsible to God for every single sin.  To say that affirmation of free trade is a promotion of sin is downright silly.  Capitalism thrives by individual action, which includes actions motivated by the “deadly sins” and also the fruits of the spirit as well.

For more on the nature of capitalism and greed, please see this post.

5. Capitalism undermines natural human bonds and wages a relentless war against tradition.

This is a standard leftist argument as well.  Fortunately though, it takes human interaction to trade on the market and capitalism allows for such peaceful relationships to exist.  Bonds are built, not undermined, as a result of business and trade.  As for tradition, perhaps these folks can get a lesson from Edmund Burke (a person they would more than likely appreciate) and his writings on tradition, namely, that tradition is a natural process and thus requires no coercion to arise.  Since capitalism assumes peaceful and natural interaction, it follows that traditions will certainly be built within the capitalist economy.

6. Capitalism’s relentless energy finally comes to rest, not in a regime of liberty, but in what British essayist Hilaire Belloc called “The Servile State,” a genial new form of slavery

Which is why, I suppose, that the more this nation has rid itself of its capitalist roots, the State has risen up, taxes have increased, and the entire Federal Bureaucratic arrangement of authoritarianism has been unleashed upon it.  Capitalism has been picked away over the last century as the State began to replace it with itself.

Several other remarks will suffice.  Here is a quote:

Christian citizens need to grow out of the idea, originally derived from anarchists of the atheist sort, that the State, as such, is an idol. That such an intrinsically un-Christian idea as radical libertarianism could be received by Christians as being the politics of the Bible indicates the depth of the pit into which we’ve fallen. Certainly we need a much smaller State, and one animated by natural and revealed law, but radical libertarianism is a fantasy-ideology which only serves the purposes of the giant corporations whose indirect rule has created the situation we’re in. But then, most “conservatism” now is definable as obsequious service to giant corporations.

If one advocates that the State replace the role of God in the society, it does not take any “anarchistic” theorizing to conclude that the State is an idol.  What else is the definition of idol?

Is libertarianism un-Christian?  Readers of this site will know how many articles have been written to show that “thou shall not steal” is not only Christian, but it applies to every person in society, yes, including the government.

Do we need a State “animated by natural… law?”  Well, are we talking Rothbard’s natural law, which leads to anarcho-capitalism, or Aristotle’s, which leads to fascism?  The problem with natural law, is that it is so broad and subjective that it really tells us nothing about what is just.  David Hume showed that the “is” cannot reveal the “ought.”  Alternatively, the Bible has given us specific principles: Don’t steal, don’t murder, etc.  It is astounding that a “Calvinist” wants to look outside the Bible to discover law.

Is radical libertarian a fantasy-ideology?  Perhaps in one narrow sense: there are so many socialists that it sometimes seems like we will never be able to scale back the State.  Does it serve the purposes of giant corporations?  Well, which “giant corporations” supported Ron Paul for President?  None.  And how many of “giant corporations” are “giant” because they feed out of the government’s trough?  All of them.  Libertarianism is dangerous to the giant corporations as they currently exist.  Does the libertarian allow for a giant corporation to exist at all?  Depends on if the market (the voluntary actions of people) support it with their spending habits or not.  If you want to get-rich-quick though, go lobby to the government, don’t become a libertarian!

Lastly, there is a long article over there against Mises, but not on the topic of economics.  We are Austrians and Misesians over here.  So we should be clear from the get go: we don’t endorse his atheism, only his economic methodology.  For a Christian analysis of Mises’ Human Action axiom, see my post here.

The reason I began with Robbins’ essay was to show that in every sect, every tradition, there are anti-capitalist and pro-capitalist mentalities.  Sadly, folks who call themselves Reformed are not exempt, neither fifty years ago, nor today on the blogosphere.  Robbins has two other essays worth reading in his collection as well: The Neo-Evangelical Assault on Capitalism and The Roman Catholic Assault on Capitalism.  When it comes to economics and policy, Christians in all denominations during the previous and present centuries have been led astray.  I agree with Robbins that the Protestant Reformation was foundational for the prospects of liberty in Western Society precisely because it rejected the old Catholic and collectivist traditions.  Calvinist International makes the mistake of assuming too much pre-reformation thought.  Finally, in his essay The Sine Qua Non of Enduring Freedom, Robbins quotes Hans Sennholz, who anyone familiar with Austrian economics and Mises.org will recognize:

[The economic system of capitalism rests] on the foundation of an ethical order that provides answers to questions such as: Why and when is an economic act called “good” or “bad,” “right” or “wrong”? What standard of conduct is acceptable and commendable or distasteful and repugnant?  What is virtue in economic life?

The market order of capitalism finds its answers in the Judeo-Christian code of morality.  Private ownership in production is squarely based on the Ten Commandments.  It obviously rests on the Eighth Commandment: Thou shalt not steal.  The private-ownership system also builds on the solid foundation of the Sixth Commandment: Thou shall not kill, which includes every form of coercion and violence…. To freely exchange goods and services, the contracting parties must not deceive each other.  They must not bear false witness, which is the Ninth Commandment of the Decalogue.

There is much more to say about this site.  It is very anti-libertarian and anti-Capitalistic and I will continue to watch what it puts out there.  But to be clear, it is not all bad.  It does quote from and link to The American Conservative magazine, which, as you may or may not know, is an awesome publication.   I don’t agree with everything in that magazine, but it has much that is good.  It is real conservatism, as opposed the crony post-Cold War and Buckleyite New Right.  Their lead editor is the brilliant Daniel McCarthy and one of their senior editors, Daniel Larison, is probably one of the best foreign policy commentators around (along with Justin Raimondo, Daniel McAdams, and John Glaser).  Let freedom ring.

Written by C.Jay Engel

Editor and creator of The Reformed Libertarian. Living in Northern California with his wife, he writes on everything from politics to theology and from culture to economic theory. You can send an email to reformedlibertarian@gmail.com
  • Making things even more complicated is Matthew Tuininga’s stance on property rights. Complicated because Tuininga is pursuing a PhD on Calvin’s two kingdoms theology in defense of VanDrunen and in opposition to the Calvinist International (the two went round and round at each other in blogs).

    Anyways:

    http://matthewtuininga.wordpress.com/2013/02/22/public-justice-for-the-poor-a-response-to-timothy-terrell/

    • cjayengel

      Yeah, I have read (but haven’t had to time to comment on) his essays. I have a draft up that needs some work still in which I address some of his claims and concerns about welfare and “social/public justice,” which I think is a deviation from Biblical justice. I look at these things by way of reviewing Ronald Nash’s book: http://amzn.to/1eIr9lp

      Nash is a great resource on Clarkian philosophy too. While not totally Clarkian, he was quite influenced by him.