Category: Money & Economics

Economic opportunity in jeopardy

Dreams are big in Texas, and we like to think this is a place to make them come true. The numbers, however, say that is not necessarily the case. A new “Opportunity Index” ranks Texas38 out of the 51 states and the District of Columbia — not good for a state that likes to be the best.

The index uses a dozen data points grouped into three dimensions of opportunity — jobs and the economy, education, and community health and civic life — to determine the rankings.

It’s a product of Opportunity Nation, which is a “bipartisan, cross-sector national campaign made up of more than 250 non-profits, businesses, educational institutions, faith-based organizations, community organizations, and individuals all working together to expand economic opportunity and close the opportunity gap in America. . . .

“Opportunity Nation’s guiding principle is that the zip code you’re born into shouldn’t determine your chances for success, and that when social mobility grinds to a halt, we are in grave danger of losing the best of America.  That is the unfortunate predicament that our country finds itself in today, and we’re working to see that this tide is reversed immediately and permanently.”

Michael Gerson, a former speech writer for George W. Bush, sees a “social crisis” developing in America, with “growing divisions of class” that threaten the American ideal. “A number of problems among working class families—less parental time with children, less community and religious involvement, less academic achievement and social trust—are predicting a social mobility crash for millions of Americans.”

There are a number of causes, and the result is a “durable, deepening national divide, increasingly rooted in class,” Gerson says. “This is an attack on the self-image of America. Americans are generally comfortable with the existence of inequality in a free economy, as long as economic advancement is a realistic goal.  But economic inequality without economic mobility is just a caste system, in which birth is destiny.”

I added the bold. “Caste system” language has a ring of backwardness and oppression that we do not usually associate with America. And that is exactly Gerson’s point. The lack of economic opportunity affects our American self-image, and rightly so.

“Policy approaches in these broad categories will vary,” Gerson writes. “Some will require government. Others, churches and charities. Others, volunteers. But all of these efforts require the recognition that equality of opportunity is not a natural state, but a social achievement, for which all of us are responsible, in one way or another.”

Rome weighs in on global economics

The Pontifical Council for Justice and Peace has issued a critique of the global financial system this week that parallels many of the criticisms of unchecked capitalism that are surfacing around the world, including through the Occupy Wall Street phenomenon.

E.J. Dionne Jr., a self-described liberal Catholic writing in a Washington Post opinion piece, brought this to my attention. He writes:

“In a knock against those who oppose government economic regulation, the council emphasized ‘the primacy of politics — which is responsible for the common good — over the economy and finance.’ …

“But Vatican officials were careful to say that their report was not a direct response to the worldwide demonstrations. ‘It is a coincidence that we share some views,’ said Bishop Mario Toso, secretary of the council. ‘But after all, these are proposals that are based on reasonableness.’

“Indeed, and that may be a larger compliment to the ’99 percent’ activists. This document got more attention than it might have because the demonstrators have heightened concern about the problems it addresses.

“Moreover, the Vatican office’s intervention shows that those protesting against a broken and unjust financial system are not expressing some marginal point of view. They are highlighting worries shared by many, including the Roman Catholic Church. To challenge what the global markets have wrought is not extreme. It reflects, as Toso said, ‘reasonableness.'”

It is indeed reasonable to expect an economic system to function fairly and equitably for all people — the rich, the middle and the poor. It is even more than reasonable for those of us who fly under the banner of Christ — it is right and it is essential. I write this as a Baptist.

It appears, however, that not not all Catholics agree with the Pontifical Council for Justice and Peace. George Weigel, a conservative Catholic writing on a National Review blog, said:

“Bottom line (so to speak): This brief document from the lower echelons of the Roman Curia no more aligns ‘the Vatican,’ the Pope, or the Catholic Church with Occupy Wall Street than does the Nicene Creed. Those who suggest it does are either grossly ill-informed or tendentious to a point of irresponsibility.”

Weigel points out that, as stated by council officials,  the document was intended to “make a contribution which might be useful to the deliberations of the [upcoming] G-20 meeting.” It was intended to “suggest possible paths to follow.”

Now, the reason a conservative like Weigel is so upset is that the document proposes more than what I mentioned above. It suggests the need for a “world political Authority” in the light of increasing globalization. That is a rather frightful proposition to many people, not just conservatives.

Without accepting the “world political Authority” portion of this proposal, many more of us can accept its broader premises. The document says:

“The economic and financial crisis which the world is going through calls everyone, individuals and peoples, to examine in depth the principles and the cultural and moral values at the basis of social coexistence. What is more, the crisis engages private actors and competent public authorities on the national, regional and international level in serious reflection on both causes and solutions of a political, economic and technical nature.”

Two points: There is a crisis, and we all need to be engaged in addressing it. Those of us who follow Christ need to bring the voice of our Savior to the world table. It is a voice that always proclaims in defense of those most in need in our world. It is a voice that challenges all of us to be stewards of the resources at our disposal and not simply consumers. It is a call to love others as we love God.

Connecting the Arab Spring to Occupy Wall Street

The Arab Spring has come to America, and its banner flies under the name Occupy Wall Street and its many Occupy offspring around the country. This year, 2011, may become known as the Year of the Masses.

Most in America cheered in the Spring as people in Tunisia, Egypt, Libya and Syria rose up against the powers that had suppressed them. Some of those people who cheered the Arab Spring are not cheering Occupy. We can be thankful the American version has not turned violent, but we can thank our democratic form of government for that.

The reality is that people will be pushed down for only so long, then they rise up. Those who think they can accumulate power and wealth without responsibility for those who do not have power and wealth live in a world of delusion.

Umair Hague, writing in the Harvard Business Review, has made the connection between these various upheavals.

Something big is happening

(Originally posted on Facebook. Comments below.)

Occupy Wall Street and the Arab Spring are part of something much bigger. Like it or not, we are in the midst of something big. How will we respond?

Business bloggers at Harvard Business Review discuss a variety of business topics including managing people, innovation, leadership, and more.

· Share · October 18 at 12:56pm

    • Laura OwenJames and I have been having these discussions – our kids are having these discussions at college. I do think it is much bigger and most people don’t even begin to understand because they are only getting what the news feeds them. It can be very dangerous…..

      October 18 at 3:00pm ·
    • James OwenIts about injustice. It is a “different” injustice from culture to culture, but make no mistake this movement is about injustice.

      October 18 at 8:19pm ·

CCDA: Economic crisis has historical roots

Lowell Noble led a workshop titled “Our Current Economic Crisis Has Historical Roots,” and it challenges Christians to think about their faith in relation to our economic system. Lowell is a volunteer with the John Perkins Foundation, and he’s a sociologist and anthropologist. (Unless I use quotation marks, the notes are paraphrases of Lowell’s comments.) Here are some highlights; one of the things I really like are the references to books and articles:

Lowell wrote this on a pad at the beginning, with reference to giant financial firms — “To big to fail, too powerful to regulate effectively, too oppressive to continue.”

“Our historical past haunts our sociological present,” or you could say our economic present.
Justice has a strong economic component to it.

The American pulpit hasn’t had much to say about the economic crisis, even though the Bible has a lot to say about economics. …

Bush’s Treasurer secretary, Henry Paulsen, said in an interview during the ’08 financial crisis that raw capitalism (high risk, unregulated, speculative capitalism) is dead. … Bush’s economic advisors told the president if he didn’t act quickly we would have another Great Depression or worse. … It put the break on. … Obama continued with the bailout.

One of Lowell’s favorite authors is Kevin Phillips. … He is a conservative Republican. At the end of the Reagan he wrote, The Politics of Rich and Poor, which was a severe critique of the Reagan years. … Deficit doubled. … Pushed deregulation and dramatically widened the gap between rich and poor…. Read it now and it seems also to be about the ’08 crisis…

Phillips also wrote Wealth and Democracy. … He said one of the signs of a declining empire is when there are more people making money, handling money than there are people producing goods…. This is true today. … Money handlers are almost parasites of society. … We need a certain number, but it can get out of hand.

Now, Phillips has written Bad Money…. He is not an ideologue. … He has been one of my mentors.

Another mentor, Paul Krugman. … The Conscience of a Liberal… Krugman says the rich and powerful have dominated society for most of (a given time)…

Great Depression broke the hold of the rich and powerful. …

Can you regulate the system enough to control the abuse or does it have to be destroyed…. Destruction would have terrible consequences; it would mean unemployment doubles…. We almost have to have a catastrophe before the system can be turned around. …

I’m afraid corporate lobbyists will prevent Obama from solving the problem. If anyone can solve it, Obama is the one. …

A small town banker told Lowell that “my function is to make rich people richer.” … This banker thinks there may be a better way. …

Another book: Mark Noll’s God and Race in American Politics

Another book: Charles Avila’s Ownership….

Augustine…. He saw the prevailing oppression of his time as an assault on Christ…. He laid the blame on the exclusive right of private ownership… The Creator willed creation to that of all in common….

Basil the Great…. Says that land, grain and sun are the part of nature to be available to all… koina… common goods contrasted with one’s own things. … an idiot is one who piles up an excessive number of goods. … “excessive ownership is a form of theft”….

Sept. 21, 2009, Newsweek issue … The author says the problem is worse now than in ’08 when it almost failed. …

David Brooks…. Generally regarded as a conservative economist … Lowell says Brooks is moderate…. He’s a thoughtful capitalist columnist for The New York Times…. He’s been agonizing over this whole situation…. What went wrong? … the vast expansion of corporate influence…. Gauntlet of lobbyists and lies…

Krugman: year ago said he was terrified…

Now the really bad news: It’s worse than any of you think…. “Stupid and Unsustainable”…

Another book: “Black Wealth, White Wealth” by Melvin Oliver and Thomas Shapiro. … It’s discusses, among other things, the high rate of incarceration in the US…

There is a massive misuse of our resources in regard to incarceration….

Military budget…. US is spending as much as all of the rest of the world … If we keep spending like currently, we are digging ourselves a big hole…

An article: “For a Fairer America” by Mortimer B. Zuckerm in US News and World Report
In WWII the government controlled almost all economic activity of any consequence…. During the next generation we had the best equality … then began to dissipate with Reagan and afterward.

An article: The Nation, July 6, 2009: “The Most Important Financial Journalist of Her Generation”…. Gretchen Morgenson….

What happened last year was the result of a system of oppression. It was just greed or stupidity…

In Reagan and afterward, corporate American argued for deregulation….

Paul Krugman: The change in america’s financial world was Ronald Reagan’s biggest gift to the western world and it’s the gift that keeps on taking.

Warren Buffet 2005: US is becoming a sharecropper’s society

Another book: Ulrich Duchrow’s Alternatives to Global Capitalism

Lowell believes we will face another financial crisis in a few years. So what’s the implication for CCDA ministries: I suggest you have a subcommittee on your board that looks at this and says, if that happens to be true, what should we do in the meantime…. Out of the ashes what could we build? …

Years ago, in Mondragon, Spain… after a financial catastrophe, they created a whole society based on cooperatives …. Grocery stores, universities,

It is possible to design an economic system that is much more Christian than ours.

Book: The Moral Measure of the Economy by Chuck Collins and Mary Wright.
—- ——-
This was a side note: Economic professors in Christian colleges are very little different from others…. Maybe there is an opportunity there…. We need to take Acts 4 seriously…. Holding things in common…