More on Keller and Economics: A Transitional Post

Commenting on issues relating to wage and labor theory, as they pertain to contemporary discussions within the evangelical community at large, poses a certain number of difficulties. In my recent short post addressing the accusation of Marxism in Tim Keller, I wrote:

Now, I don’t hold it against Keller that he has not taken the time to meander through the three volume Capital and Interest, which was the first systematic treatise to, among a vast number of other things, lay waste to Marxian capital, wage, and value theory. After all, economics is a unique and niche discipline and Keller is focused elsewhere. But perhaps it is precisely because he hasn’t taken the time to study these matters that he does not recognize the similarities between his foundations and Marx’s. Or at the very least, he does not recognize that he unwittingly stumbled accidentally into similar conclusions as Marxians precisely because he does not recognize the distinction between Marx’s assumptions and Bohm-Bawerk’s.

Throughout the evangelical (inasmuch as this still has meaning) online world, I have seen the following sentiment at least half a dozen times from seminarians in “conservative” (inasmuch, again, as this means something), Reformed schools: Just because Karl Marx said it or identified some particular problem, does not make it untrue; neither does it constitute labelling Keller a Marxist. This is an observation that serves as a launching pad for a very important elaboration on my comment regarding Keller’s lack of knowledge regarding foundational economic principles. Or, to broaden the problem: Christians in general lack a proper understanding of wage and labor theory. They therefore don’t see the danger of adopting frameworks that undermine justice, prosperity, and ultimately a thriving society.

In the name of offering hope for society, they instead feed the ideas that have wrought the greatest digressions from a social arrangement that serves the benefit of the poorest. Let me not mince words: all the objectives relating to bringing the poor out of their poverty, supporting a rising standard of living for all social classes, and advancing a social order which renders justice impartially— all these objectives and their derivatives are to be most adequately fulfilled in the implementation of laissez-faire capitalism.

The great and devastating— truly devastating— assumption of those, like Keller, who offer “concerns” about pure free market capitalism is that we ought to instead prefer an arrangement that benefits the good of the whole. But the free marketers, who in previous generations were referred to as “liberals” (as in classical liberals), prefer exactly that end.  It is falsely assumed that the debate is over whether we ought to prefer the interests of the privileged classes over and above the interests of lower classes. But the claim of the capitalists is that, under an arrangement of the private ownership of the means of production and the legal authorization that the owners have to do with their property what they will, the society holistically grows in wealth. This is the means by which the poor will escape the ravages of natural impoverishment. After all, mankind in a state of nature (which merely means in a world without any capital or consumption goods) is by definition without this wealth and is therefore, for all intents and purposes, poor. The question is not how society becomes poor. The great question— answered by the youngest of the social sciences (economics)— is how society breaks free from this natural impoverishment.

Thus, Ludwig Von Mises once wrote:

There is a widespread opinion that liberalism is distinguished from other political movements by the fact that it places the interests of a part of society-the propertied classes, the capitalists, the entrepreneurs-above the interests of the other classes. This assertion is completely mistaken. Liberalism has always had in view the good of the whole, not that of any special group. It was this that the English utilitarians meant to express-although, it is true, not very aptly-in their famous formula, “the greatest happiness of the greatest number.” Historically, liberalism was the first political movement that aimed at promoting the welfare of all, not that of special groups. Liberalism is distinguished from socialism, which likewise professes to strive for the good of all, not by the goal at which it aims, but by the means that it chooses to attain that goal.

Now, because of the presumed audience of this essay, I should note quickly that this does not mean I am a utilitarian– but nevertheless I hope that this articulates the crux of my point: the debate is not over the goal at which we aim, but the proper means that will most completely attain the goal. Keller and those like him want to help the poor— but it must never be assumed, and their opponents must never let them get away with the notion, that this is the defining characteristic of their position.

For we free marketers hold quite seriously that only capitalism can achieve this. To say this in another way, the facts of economics teach us that charitable persons cannot, in their actions of charities, increase the social standards of living; they can only temporarily off-set immediate needs. This too is a vital point that must be understood: the role of charity, of immediate term solutions, of those with two coats giving one to those with none, is not to make society wealthier— it does not create more coats for more people. Therefore, we maintain that charity is good and beneficial; but there are other components to the alleviation of poverty. The only means toward long-term alleviation of poverty and a rising mass standard of living is capital investment— not current liquidity distribution. Charity serves a specific purpose and to expand the role of charity beyond this is to literally undermine the very activities which are needed for the next generation of poor to escape impoverishment.

The proponent of so-called and ill-defined “social justice” is not unique in his desire to see poverty eradicated. The capitalist too praises its eradication. But the capitalist understands that mankind was born into poverty and wealth is a result of human action over time. Poverty can only be eliminated if the wealth of the whole society grows to a point where it reaches all corners of a given society. But it is only capitalism, not socialism and its varieties, which can accomplish this.

Treating the accomplishments of capitalism as human rights undermines the very system that provided our higher (compared to thousands of years of human history) standard of living in the first place. The advocates of social justice take examples of the products and results of capitalism and make access to them a stipulation of true justice— but without the price and profit-system, their existence would never have been possible at all. The advancements in health care, medicine, travel, communication, widespread education, can only be observed precisely because of investment of capital in past eras. By preaching against capitalism, the Kellerites are laying the groundwork for unraveling and regressing to the social wealth levels that existed before these marvelous accomplishments were achieved.

The future of western civilization depends on the message of capitalism and free markets. It depends on people understanding that the wealth we see around us is a result of capitalism– of the “rich” seeking profits by investing their capital in hopes of profiting. In the words of George Reisman, “the protesters and all other haters of capitalists hate the foundations of their own existence.”

I am currently writing a post which seeks to unravel Keller’s attempt to lead to a mass rethinking of how we approach work, wages, and labor. I am going to address several themes:

1. That Keller holds to a misunderstanding of how the wage and labor system really work under both free market theory and in our present government-dominated arrangement. (That is, he follows the false notion that we live in a free market economy).

2. That Keller promotes a collection of straw men about what wage-work communicates about the value of work (he operates under the mistaken framework that working to pay the bills or put food on the table is inferior to work as a vocational “calling” and, as a related matter, that work should be done as a service to others rather than for personal benefit— this latter separation is a great deviation from the unity in social and individual interests discovered by the economics as a distinct social science).

3. That Keller:

  • Sometimes seeks to provide solutions to problems that don’t exist
  • Sometimes provides the wrong solutions to problems that were actually caused by variations of his proposed solutions
  • And sometimes misinterprets a healthy feature of the free market as the cause of some other problem, and therefore he seeks to intellectually undermine this healthy feature while interpreting his effort as battling the cause of that problem.

4. And finally, given number (3), he attempts to offer a systematic reconstruction of our social framework in a way that, on the surface, does not lead to the solutions offered by actual state-sponsored socialism of past generations.

What I have in mind on this final point is important because I want to discuss the development of Orthodox Marxism from its violent expressions to what we might call “sanctified socialism,” or, since Western evangelicals disregard the socialist label, but still want to keep some of the narratives, religious communitarianism, especially as it depended on the social justice contributions of the Jesuits and other left-evangelicals. Because, quite clearly, these Kellerites, who I do think adopt major fundamentals of the Marxist interpretation of wages, worker-capitalist relations, labor power, and so forth, are always quick to deny that they advocate brute government involvement (though other times— their opposition to low taxes, for instance— they contradict themselves). That is we who understand the true nature of capitalism, the true role of wages, the true function of the laborer, still have much to criticize in Kellerite economics, even if they claim they don’t need state-force as a means to their ends.