THE GOVERNMENT’S ROLE IN ECONOMICS

As Europe shudders with the death throes of its client economies, it is hard to imagine a better time for us than now in which to take a look at those ingredients that are most likely to bring a sound and bountiful economy to a people, for if we in America do not soon alter course, we will in short order follow our friends into the ruin brought on by that modern economic thought so deeply laced and sanctioned with governmental involvement.  Fortunately for us, these simple ingredients are not hard to understand and attain, for (as should be expected) the Scriptures detail them clearly and easily for us.

In my previous article (The Redistribution of Poverty) I outlined those duties specifically given to government by Scripture and its Author, and it is worth noting that nowhere within those duties is economic interference or control mentioned.  Simply put, government has no business flirting with the economy of its people, but is instead tasked only with establishing certain beneficial conditions, as we shall now discuss.  If government does these things simply and well, a robust economy will have the greatest chance of occurring within its borders.

The first condition to be established by government is that all land is to be privately owned by the citizens of the nation.  The only authorized public land (land owned by the government) should therefore be that which is the absolute minimum needed to accomplish those few tasks of government that we have already described, and not an acre more.  This is precisely how God apportioned the Promised Land in Joshua 13-19, with the only public land being that set aside for the Tabernacle in Shiloh (Joshua 18:1) and the roadways leading to the Cities of Refuge (Deuteronomy 19:3).  Once the land was put into the hands of private citizens, each land owner was free to do with their land as they desired.

Secondly, by enforcing the Eighth Commandment (you shall not steal), government was tasked with protecting private property, which also meant that it was not allowed to redistribute land or wealth in any manner (as we have already discussed).  In this sense, government is to act only as an impartial referee between contesting parties, desiring only to protect rightful ownership in all instances (Deuteronomy 1:16,17).

This idea cannot be stressed deeply enough, for the right to control of one’s property (whether as land, wealth or goods) is the basis for order and productivity within a nation.  Regarding order, if someone’s property may be taken without fear of serious reprisal, all cohesion among a people will quickly be lost, resulting in anarchy (Judges 21:25).  Regarding productivity, no one will for long work for that which he cannot keep, resulting in little to no stimulus for work or innovation among a people.

We next see that government was meant to neither regulate business nor the marketplace, for we must remember that Israelites were free to do with their property as they wished, and the marketplace is the same concept on a larger scale.  This point is not made directly in Scripture, but is made instead by the thundering silence of the absence of regulatory netting in the Law of Moses, which was so short and simple that it could be memorized in its entirety by the average citizen of the day.  People were essentially free to provide innumerable goods and services for one another without government involvement in any way.

We must now touch briefly upon the idea of national sovereignty and security, since few things will despoil an economy like being overrun by a conquering military.  A substantial portion of government’s responsibility toward economic soundness is therefore ensuring the safety of its people and the integrity of its land, which essentially is protecting property rights on a national scale.  It was not by coincidence that Israel’s most bountiful years were those of Solomon, for he had peace and security on all sides (1 Kings 4:20-25; 5:3,4).

Finally, there is the means by which government raises the funding necessary to fulfill its few but important functions, for this must in some way be done.  The Bible allows for this in one of two manners: either everyone pays the same amount (Exodus 30:15), or everyone pays the same percentage on income (Leviticus 27:30).  The rich are not to pay more nor the poor less, for all have an equal stake in the necessity and benefits of good government, and few things will destroy economic incentive faster than forced redistribution (progressive taxation), since it legally enshrines theft.  Simply put, no one gets a free ride.

The essence, then, of the government’s role in economics is therefore actually quite easy to understand: Make land available for private ownership; solemnly protect private ownership of goods, land and wealth; regulate nothing outside of government’s Biblical charter; keep your land and people safe; and collect an equal share from all citizens in order to carry out those functions deemed absolutely necessary to government.  If an even shorter version is desired, try this: Ensure private ownership, keep your nose where it belongs, secure the borders and tax equally.

When a people limit their government’s involvement in its economy to within these compact guidelines, the stage will be set for economic blessing.  This blessing, however, is by no means certain, for it also hinges upon the moral character of a nation and its people, as economic depth cannot for long run deeper than moral depth.  But for the exploration of that idea we shall have to wait until next time.  God bless, and see you then.