From Serfdom to the Middle Class

The majority of Europeans during the middle ages lived as serfs on land owned by Kings and Lords who ruled from fortified castles. They were trapped in subsistence living, but this was accepted because people had no concept of advancing from one class to a higher class. The medieval church even wrongly supported this system with their teaching. But the Judeo-Christian truth of God desiring for people to advance, began to take hold and bring change.

The principles of Biblical capitalism eventually led to the triumph of the Judeo-Christian ethic over Greek and Roman thought. Capitalism was the system, which freed the Western world from the greater oppression of the powerful over the mass of humanity by giving each person the opportunity to advance. Capitalism allowed a middle class to arise and displace the ruling class. It also catapulted the Western world ahead of other civilizations, creating economic inequality in the world. Should those with means be punished or should those without means be lifted up?

Today some advocate that government should tax the rich and give to the poor to reduce inequality. However, this ignores how “growing the economy” seems to be a better answer to help the poor. Between 1990 and 2010, the number of people worldwide living in extreme poverty (i.e. on less than $1.90 a day) was cut in half, and has continued to decline since then. This is 20 years of enormous progress. Two economists, Tomas Hellebrandt and Paolo Mauro, studied this and concluded, in a 2015 paper published by the Peterson Institute for International Economics, that global income inequality declined between 2003 and 2013 due to rapid economic growth in poor nations.

There are two ways to close the gap between the rich and the poor. The first is to concentrate on making the poor better off. The second way to reduce inequality is to make the rich worse off. In a relatively free economy, the main way to get wealthy is to produce something that people value. This has been a basic economic insight at least since Adam Smith’s “The Wealth of Nations,” published in 1776. Wealth is one of the main rewards for productive work. High taxes on wealth and the wealthy reduce the incentive to produce.

For example money to be invested in business and commerce will tend to move to the place where taxes are the lowest. So raising taxes will tend to move capital investment, the associated jobs and a rising standard of living, away from those that the “taxers” are trying to help.

Sources:

Compassionate Capitalism – A Judeo-Christian Value by Harold Eberle, 2010, Worldcast Publishing.

A War on the Rich Won’t Help the Poor by Henderson; Wall Street Journal, Feb 9, 2018. Mr. Henderson is a research fellow with the Hoover Institution, and an editor of the Concise Encyclopedia of Economics. Appeared in the February 9, 2018, print edition.

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Biblical Ethics Lead to Prosperity

In the New Testament we find biblical ethics that make it easier to prosper in business and commerce. Where the Ten Commandments said, “Thou shalt not lie”; the New Testament took this honesty a step further when Jesus presented the golden rule in Luke 6:31, “Do to others, as you would have them do to you.” Honest business dealings will cause you to prosper. Dishonest business dealings will cause you to go out of business.

In a relatively free economy, the main way to get wealthy is to produce something that people value. A good example would be the Microsoft’s computer software that changed the world and made it easier for a lot of people to do their jobs and live. Producing something people value and are willing to pay for has been a basic economic insight at least since Adam Smith’s “The Wealth of Nations,” was published in 1776. Wealth is one of the main rewards for productive work.

Lets say a business owner is selling a desirable product to an individual at a certain price. If the product does not deliver as advertised, the purchasing individual will not buy the product again; and they will tell all their acquaintances to not buy this product from the business owner. If the purchaser finds the same product at a better price elsewhere, they will not purchase it again from this business owner. And they will tell their acquaintances to buy this product at the place it is available for a cheaper price. But if the product delivers and the price is fair, this purchasing person will buy more from the business owner and tell their relationships to do the same.

Jesus stating of the Golden Rule works for all of life. But is it especially helpful in business and commerce. Biblical ethics lead to prosperity.

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Christianity Spurred Technology Gains in the Ancient World

After Constantine legalized Christianity, it began to spread into Europe. When Rome was sacked in 410, Christianity emerged as the largest coherent group and gradually increased its influence. People began to see they were not enslaved to their fatalistic lot in life as taught by the Greeks and Romans, and that they could advance. Christianity brought advancement and growth with developing technologies. Watermills were developed and built across Europe. This provided for them what our modern motor does for us. People were enabled to efficiently cut lumber, turn lathes, grind knives, cut stones, mechanize cloth making, hammer metal and make pulp for producing paper.

Windmills were also employed to pump water for irrigation and to drain wetlands. Chimneys, glass and clocks were invented. New plows opened up areas for farming. Round ships and compasses were developed and opened up the world to shipping. Land transportation was revolutionized by the invention of horse collars and wagons with brakes and front axels to swivel. Harold Eberle describes the change from just one of these inventions:

Consider how the invention of the chimney changed society. Before homes had chimneys, people lived in unheated shelters or in homes filled with smoke. Without chimney’s people smelled like smoke, breathed toxic air and often ate uncooked food. With chimney’s as only one of many advances we can be assured that life for the common people in the Middle Ages was better than it was for them during the Greek and Roman empire.

The church began to displace pagan views and replace them with what we would consider a civilized world. For example, the advancing church stopped the murderous entertainment of the Roman world. Advancing Christianity quickly transformed the Coliseum, which was famous for public death in the name of entertainment. It went through many transitions at various times; including providing space for housing, workshops, churches and a religious order. Much of the tumbled stone was removed and then used to build palaces, churches, hospitals and other buildings elsewhere in Rome. Pope Sixtus even tried to turn the building in to a wool factory to provide employment for Rome’s prostitutes. Though not fully developed into Christianity as we see it today, the impact of Christian values was profound and brought advancement to society.

Next blog…how the Biblical principles of capitalisms raised the masses out of serfdom.

 

Source: Compassionate Capitalism – A Judeo-Christian Value by Harold Eberle, 2010, Worldcast Publishing.

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Land Lifts the Poor Out of Poverty

One of the first things God did for Abraham and the children of Israel was to give them land. Abraham’s ancestors were pagans and wondering nomads. Today we would call them homeless. Why did God give them land? It is because he wanted to teach them to prosper. He wanted to teach them to nurture and use capital.

As I have traveled to many developing nations, one thing is clear. The rich and middle class own land and the poor do not. In a lot of countries there is no middle class. Land and home ownership is the one thing that will permanently lift the poor out of poverty and in to the middle class. However, in many of these nations there is no legal basis to get a title to show that you own a property. In many cases, there can be five or six people claiming to own a piece of land.

Enter the Biblical worldview. Generally speaking, people fail to appreciate the relationship between private property rights and economic development. Karl Marx saw private property as the source of wealth and called for its elimination to promote equality, though it meant equally poor. A country without a formal system for registering property rights limits its own economic development. It also prevents its citizens from realizing their full potential. If it can’t be legally proved that an individual owns the land, they will never defend it or borrow against it to start a business. Simply stated…the road to economic development runs through the local land registration office or courthouse.

The great economic divide in the world today is between the 2.5 billion people who can register property rights and the five billion who are impoverished, mostly because they can’t. Outside the developed world and some advanced regions of developing countries, there are no accessible records detailing who owns land.

Instead of destroying private property to promote a Marxist equality in poverty, perhaps we can bring property rights, and prosperity, to all mankind. Where property rights are ensured, so are the prosperity, freedom and ownership of wealth that brings real stability and peace. So for all the money that goes to help the poor around the world, perhaps some money should go to a more practical solution like helping develop a legally bound system that can identify and maintain records of property ownership. Then pastors and church leaders can teach the poor how to own land.

Source:

How Blockchain Can End Poverty: Two-thirds of the world’s population lacks access to a formal system of property rights. Wall Street Journal by Phil Gramm and Hernando de Soto, 1-26-18.

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Abraham Lincoln’s Encouragement to Industry and Enterprise

We find personal incentive and reward to be at the core of Biblical economics and also central to the principles of capitalism. In looking at what the New Testament says about personal incentive and reward, we find the following words in 1 Timothy 5:18.

For Scripture says, “Do not muzzle an ox while it is treading out the grain,” and “The worker deserves his wages.”

Here Timothy is speaking of financially rewarding church leaders for their service, but the principle extends to all. Timothy quotes from Paul in Corinthians where he references the Old Testament talking about not muzzling an ox. Timothy also quotes Jesus talking about a worker deserving his wages. A clear theme Biblical theme emerges teaching us the importance of personal incentive and reward.

Fortunately for those of us living in the United States, this Judeo Christian worldview was present at its founding and incorporated throughout. Consider the following quote from Abraham Lincoln…

Property is the fruit of labor. Property is desirable, is a positive good in the world. That some should be rich shows that others may become rich and hence is just encouragement to industry and enterprise. Let not him who is houseless pull down the house of another, but let him work diligently to build one for himself, thus by example assuring that his own shall be safe from violence… I take it that it is best for all, to leave each man free to acquire property as fast as he can. Some will get wealthy. I don’t believe in a law to prevent a man from getting rich: it would do more harm than good.”

So work. Be blessed. Live joyfully. Save expectantly. Give generously.

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The Ten Commandments for Making Money

At the beginning of the year many of us are thinking about resources to better ourselves. As our regular readers know, one of the resources I use for this blog is the book by Rabbi Daniel Lapin, Thou Shall Prosper: Ten Commandments For Making MoneyIn this book he explains the Biblical Hebrew worldview of making money we find in the Old Testament. If you have already read my book and want to read just one book to add value to your understanding of making money, this is the one I recommend.

However, for the many who will not read this book, I have summarized his 10 Commandments below to stir your thinking for this year. Perhaps one of these commandments will stir some practical steps you can take to change your finances this year.

Rabbi Lapin’s 10 Commandments:

  1. Believe in the Dignity and Morality of Business.  Recognize that you are in business, and that the occupation of business is moral, noble and worthy.
  2.  Extend the Network of Your Connectedness to Many People. Only by actively and perhaps even joyously interacting with other people can the circumstances of wealth creation be set in place.
  3. Get to Know Yourself.  Even if you work for someone else, prosper in it by seeking new responsibilities and over deliver to exceed others expectations.
  4. Do Not Pursue Perfection.In both business and your personal life, try to become comfortable with the second best solution if the very best solution is unattainable.
  5. Lead Consistently and Constantly. Don’t try to become a leader; start leading!
  6. Constantly Change The Changeable, While Steadfastly Clinging to the Unchangeable. Convert change from enemy to ally by understanding when to enjoy the exhilaration of change and when to fight it and steadfastly defend the unchangeable.
  7. Learn To Foretell The Future. Wisdom is seeing tomorrow’s consequences of today’s events.
  8. Know Your Money.Your money is a quantifiable analog for your life force- the aggregate of your time, skills, experience persistence, and relationships.
  9. Act Rich: Give Away 10 Percent of your After Tax Income. Don’t live beyond your means: instead give beyond your means.
  10. Never RetireIntegrate your vocation and your identity by thinking of life as a journey rather than a destination.

Rabbi Daniel Lapin’s book Thou Shall Prosper: Ten Commandments For Making Money.

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All Vocations Are Holy

The New Testament is clear that work is a good and godly thing. The apostle Paul encourages work ethic and productivity.

For even when we were with you, we gave you this rule: “The one who is unwilling to work shall not eat.”                                                                        2 Thess. 3:10

Anyone who does not provide for their relatives, and especially for their own household, has denied the faith and is worse than an unbeliever.   1 Timothy 5:8

Work for what you eat and posses. Provide for you family. Be productive. Enjoy the fruit of your labor. The incentive too work and enjoy the product of your efforts is a good thing. The early Christians confronted a Greek and Roman value system that had a low regard for manual labor and the dignity of man. Plato and Aristotle wrote that slaves should do all manual labor. Slaves were thought to be slaves by fate, and inferior to free men. They had no concept of labor or commerce being a virtuous thing until early Christians started to teach this truth.

In the late middle ages, Church monasteries played a role in setting a new standard of work. The Benedictine monks lived by the Benedictine rule, which demanded that brothers lived by the labor of their own hands. During the Protestant Reformation capitalism emerged in a significant way. John Calvin and Martin Luther taught that all vocations are holy. A person could be a priest, a merchant or a mason and still be pleasing to God as long as they were fulfilling their calling. It was no longer necessary to join a religious order to please God. It lifted the self-identity and stature of the common person.

Later the Puritans took it a step further, emphasizing the importance of fulfilling one’s God given calling or vocation. Calvin and other Protestant reformers also encouraged the aggressive pursuit of wealth through honest, hard work. The emergence of capitalism to impact and provide an economic lift to society was an unexpected by product of the Protestant Reformation.

So what does this mean of us? Work and be productive. You have ideas that will help your place of business or employment be more productive. Create…make yourself and those around you better.

 

Source: Compassionate Capitalism – A Judeo-Christian Value by Harold Eberle, 2010, Worldcast Publishing.

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