Please note, this article represents Class Five of a series. Other Classes are available for viewing under the “Classes” tab.

“Another way to solve the traffic problems of this country is to pass a law
that only paid-for cars be allowed to use the highways.” —Will Rogers

I confess to being one of the worst, or greatest if you’re a man, car men ever. I even bought a car recently whose sticker price was a hundred thousand dollars. (Don’t stop reading. I didn’t pay that!!) While I struggled with the money I spent, I didn’t struggle at all with God. I’ve learned that may be the most important stewardship concept I share with Christians who’ve graduated from financial elementary school through university and want to mature to the financial seminary. Here’s why.

I became a teenager during the muscle car days of the mid-sixties. My first real car--that is one I didn’t have to share with my dad--was a slightly used 1968 Camaro SS 350 with bucket seats, four on the floor, red stripe tires, and Crager chrome reverse wheels. It was just the toy to bring a shy young country boy out of his shell. I bought it from a guy who’d re-upped in Vietnam and made me one very special deal on it. That is, I was a vulture capitalist who stole it. Yet my struggle had started earlier in life; so it wasn’t pure joy for me despite the rubber it would burn. 

That feeling began a couple years earlier when my dad literally walked away from a slightly used Cadillac by telling the salesman: “If I drove a Cadillac, they wouldn’t let us in the parking lot of our Baptist church.” And that wasn’t a negotiating tactic. We went to a tiny country church and there was only one neighbor we knew who drove a Cadillac. He was the only millionaire in our county and was no Christian. I’ve always wondered if he even wanted to be as he might not get to enjoy his Cadillac. (Let me quickly state that many fine Baptists now drive Cadillacs!) Anyway, dad then bought a slightly used (yeah, there’s a definite pattern there) Buick Electra 225 Limited for more than the Cadillac would have cost. I’ve always thought he really wanted the Cadillac. But at least he could go to church, which was far more important to him. I admired that but still thought it a shame.

The first stewardship lesson my parents taught me was that you can’t eat your seed corn and plant it too. It’s also the longest lesson as mom’s now eighty-two and still reminds me of that reality each time we get together. (God help Wendy’s if they mess with the dollar menu!) And they planted so much there were times we didn’t usually have all we might want to “eat” when I was a kid. That is, while they married penniless, they invested in a farm, John Deere dealership, gas station, trucking company and goodness knows what else I didn’t know about. But first, they always tithed at least ten percent. I’ll never stop hearing mom say, “God can do more with 90% than you can do with 100%.” If two Christians ever deserved to drive a used Cadillac if they wanted to after planting rather than eating their first twenty years together, it was mom and dad. 

When I got out of college before reporting to the Army, I worked for a few months doing economic research for the Federal Home Loan Bank Board in the shadow of the capitol building in Washington. I roomed with a soldier who worked in the Pentagon. Quickly learning my weakness for cars, he came home one night telling me I should buy his commanding officer’s old car. He had just made general and was going to buy a sporty new Mercedes. That meant he needed to sell his twenty year old Mercedes sport coup. Yes, a 1959 190SL; the two-seat convertible. It was white with red leather and four on the floor. So I sold the Camaro; bought the Mercedes for $1,800; drove it four years with no mechanical issues; and sold it to a friend for $10,000. That seemed like cheap transportation. 

When I married my VW bug-driving fiancée, we moved to Florida with no money. We literally could not afford insurance for two years on the old compact cars we had. But we started giving and planting. And by the mid-eighties, we could afford a very nice car as God had planted me on Wall Street at the beginning of a bull market. I noticed the dollar was unusually strong from the high interest rates of Paul Volker. That meant ours would buy a lot more overseas than it would here. So I imported a slightly used Mercedes 280 SL directly from Germany and paid cash for it. It was red with saddle interior; so my young son and I even got to drive the queen of the Strawberry festival in the parade each year! We put 160,000 miles on it and sold it for what we had paid for it. Again, that seemed like cheap, but fun, transportation.

It was about that time that I drove into the wall of Wall Street (having it “all” and realizing it was meaningless without God) and thought of going to seminary. When I didn’t and began studying stewardship instead, I thought I had to get rid of the Mercedes. It seemed like every Christian financial author I read made clear connections between righteousness and the make and age of the car I drove. But during all my soul-searching, my global perspective kept reminding me that hundreds of millions of my fellow Christians do not even own a bicycle. So when I wrote my first book, I included a throwaway line about knowing ethical Christians who drove expensive cars and ethically-challenged Christians who drove old cars, so I concluded God probably wasn’t all that concerned with what we drove. When Larry Burkett reviewed the book for Moody magazine, he emphasized that quip. After I got to know Larry, I learned his primary hobby was restoring cars and he was irritated by the car thing too.

I later worked with a fellow who had a picture of Jesus above his desk. He drove a VW bug but was still, let’s say, less than reflective of that fellow who rode that donkey into Jerusalem centuries ago. Despite his thrift with cars, he still owes me enough for me to buy a very nice car. But I haven’t heard from him in years. It wasn’t much later that I was invited to speak at an economic conference that Chuck Colson put on. Jack and Joanne Kemp were in attendance. As I had served on Jack’s board of advisors, he knew what I taught. So Joanne came to my session. When we all got together afterward, Joanne exclaimed rather excitedly, “He says we can drive a nice car.” I realized two of the most wonderful and successful Christians I knew were struggling with the car issue. Ironically, after Jack lost his bid with Bob Dole to be vice-president, we asked him when he knew it was over. He replied he didn’t until the morning after the election when he got into the back seat of his limo and realized there was no driver! 

About the same time, I was serving on Robert Schuller’s board at The Crystal Cathedral. It’s no secret that one of Bob’s very affluent friends gave him a limousine so Bob could read, write and chat while being driven around that parking lot called Los Angeles. Of course, I was expected to do a little fundraising for Bob. But virtually all my affluent Christian friends were friends or disciples of my mentor Sir John Templeton. And John famously insisted on driving old cars. A hotel I was staying at in Nassau once insisted I take its limousine to see John. I sweated all the way down the island and told him I’d rather a fearsome God see me in all my wretchedness than for a Calvinist like him to see me in a limousine! Late in his life when he was worth hundreds of millions, I strongly encouraged John to buy a new car. He had driven to meet me while holding the driver’s door shut with his left hand. He couldn’t even close the door once he got to his club, where we were to eat lunch. Not too much later, John splurged on a new Kia, as I remember. Humor aside, it seemed that each time I asked John or his friends for some funding for Bob, the subject of cars popped up.

Sir John also has a cousin who lives in my town. He is a devout Southern Baptist and a very successful Toyota dealer. So he has established a foundation that is quite generous to Christian causes. But my guess is he won’t be funding too many financial ministries that teach good Christians always drive old cars. He understands the “paradox of thrift”; that one man’s thrift can cost another man’s job.

And so it goes, seemingly in the lives of all American Christians, whether over cars, as in my case, or houses or something else. We might quote the Bible as saying man looks on the outside but God looks at the inside; but we don’t really seem to believe it. But I guess that’s why I still need to tell you that I only paid about a third of sticker for my Mercedes, even though it only has twenty thousand miles on it. I honestly intend for it to be my last car. (The sounds you hear are my wife and son laughing!) And my rationale is that with all the deficits Washington is running these days, it’s a fairly good hedge against the dollar. Yet deep in my soul, I know that’s not why I bought it. Truth is I’ve always figured I can live in my car but I can’t drive my house. (Sorry honey.) And I truly admire the human genius and creativity behind the automobile, foreign or domestic. It’s at least as impressive as all those tractors dad supplied to me when I was tending the farm after he became an entrepreneur. Yeah, I know I’ll little resemble Jesus to most of my Christian friends when I drive it to church. Guess we’ll always look on the outside. But I know where God is looking; and I’m all right with that these days. And I can always buy a John Deere cap to wear while driving. 

There is a legitimate financial message in all this. I believe that what is really changing in America is that consumerism is dying. We may become more European in that we may no longer be what we buy, as I thought I was when I bought that muscular and quick Camaro when in college. That could be very good for the budget and therefore spiritual life, of my son, even though he spends enough on cars to remind us that nut hasn’t fallen too far from the tree. But I still hope that he, and you, will always appreciate and enjoy the beautiful things of this world. the creativity of human beings, and that we are truly created in the image of an awesome God.

My awesome dad joined that God long ago. Dad died from cancer a few months short of retiring at age fifty-five. The only Cadillac he ever rode in was his hearse. And when I recently bought my awesome mother a slightly used Lexus, I found she’s afraid she’s now too old to enjoy it by actually taking it out of the garage. Let’s pray that “stewardism,” or the spiritually-infused capitalism I hope is coming, re-prioritizes spiritual riches over material riches in the decades to come. But let’s remember the incarnation of Christ insists they are eternally and intimately connected. 

Please note, this article is Class Four of a series. Other Classes are available for viewing under the “Classes” tab.

“Most people who time the market are terrible at it: Cash flows into stock funds hit peaks in early 2000 and ebbed as the market hit bottom. This kind of activity is incredibly costly. From 1989 through 2008, the S&P 500 gained a bit more than 8% a year, but the average equity fund investor earned less than 2% thanks to lousy market timing.”
Fortune
December 21, 2009

You’ve finally listened to the wisdom of ministries telling you to pay off your credit cards. You’re giving more. Like the typical American, your savings rate has increased from 2% to 6%. You read The Automatic Millionaire, as suggested by a major ministry a couple years ago and have even prayed for the stocks in your IRA to go up, as suggested by The Prayer of Jabez. But it’s smaller than it was two years ago. Has your faith failed you? Not at all. You’re simply learning the hard way what humanity has insisted on learning the hard way since Plato compared life to living in a cave. (Google “Plato’s Cave.”)

Plato essentially said most of us live as if we are sitting in a dark cave. There is a fire behind us and other people are making shadows on the walls in front of us. We believe the shadows are reality. Occasionally, someone like Jesus--but perhaps Lincoln, Gandhi, or Martin Luther King--strolls into the cave to lead us to the light. To paraphrase, Jesus was the way out of the cave, the truth rather than the shadows, and life in the light rather than the darkness.

Unfortunately two things prevent our following them: We are bound to our chairs by having grown accustomed to the darkness and shadows, and the people making the shadows usually kill the enlightened ones. They do so as they like the way things are. Their incentives can be political, which is usually about money sooner or later, but it’s usually about money directly, particularly in a capitalist society.

For example, The New York Times used to run a very effective ad. It was striking in its simplicity: a full page with a small world with a crack running through it. A tiny man was sitting on top. The caption below simply read “The Times Demand the Times.” The implication was that this investment counselor couldn’t survive the problems of life unless I subscribed to their publication.

But my mentor Sir John Templeton, the Rhodes Scholar turned legendary mutual fund manager who was often called the “Dean of Global Investing,” was telling us we’d never invest wisely if we read the popular press. He even suggested most newspapers would soon go out of business as they were almost exclusively focused on the bad news that sells papers rather than the good news that shapes a richer life for us.

Of course, we Christians know “the world,” operates that way. That’s why we can depend on religious leaders we know. Wrong. In fact, Jesus knew the Pharisees made so many shadows he never had time to fight with anyone else. But surely we know better as we have that biblical Truth. Wrong again. The more you listen to Christian media the more you are likely to think the Bible, our real source of Truth, is about how life was, rather than is.

For example, the January 2010 issue of Christianity Today contains a story entitled “Chicken Little Was Wrong.” It begins by cautioning cave dwellers that: “The statistics we most love to repeat may be leading us to make bad choices about the church.” It then quotes a leading religious sociologist as saying: “Why do evangelicals recurrently abuse statistics? My observation is that they are usually trying desperately to attract attention and raise people’s concern in order to mobilize resources and action for some cause….Evangelical leaders and organizations routinely use descriptive statistics in sloppy, unwarranted, misrepresenting, and sometimes absolutely preposterous ways.”

So what’s that got to do with your IRA? Everything. During the early nineties, the Dow was at 3000 and I was telling as many evangelicals as possible that John Templeton was predicting a strong economy and roaring bull market. And being an advocate of debt-free living, as well as a fan of “Austrian economics,” John was most aware of the federal debt. But few listened as they had been reading books about the federal debt being a giant that would prevent our entering the Promised Land.

In the late nineties, John began saying that even though he believed the Dow would rise to one million during the coming century, he thought investors would be lucky to break even during the coming decade. Good advice again. Sadly, few heard him as they were preoccupied with tapes and books about Y2K being another giant.

And in March 2009 when the Dow was in the dumps, Dick Towner asked me to come to Willow Creek and address perceptions that America was already in Great Depression Two. Fortunately, I explained why I thought John would be buying some stocks. The media was uniformly negative. Everyone seemed to “know” the federal debt had finally shook the economy to pieces. And the American consumer was “drowning in a sea of red ink.” So the stock market could go nowhere. Wrong again. It rose 70% during the coming seven months.

As we discussed the federal debt in class one, let me shine a bit of light on the American consumer being broke; for that is commonly accepted as truth when it comes to why we don’t give more, as well as why many of us are again fearfully hoarding trillions of dollars in very low-paying CD’s when they could be creating jobs and so on. 

There is a scholarly new book on the market entitled Passing the Plate: Why American Christians Don’t Give Away More Money. It finally explains what I’ve been trying to tell the church for years that analysts, like the Federal Reserve and Faire Isaac, routinely say about credit card debt.

“One commonly cited statistic in the media is that the average American owes more than $8,000 in credit card debt. That kind of liability, if true, would certainly get in the way of more generous religious and charitable financial giving. The evidence, however, suggests that, while a fairly small minority of Americans really is in serious credit card debt, the majority are not. Numbers like $8,000 are inflated in the calculation of mean averages by a relatively few people who are in huge debt.”

Reality is that the median credit card debt, the one that affects you, me and our charities, is much lower and very manageable. Now, I’m not saying credit management isn’t highly important. But it’s not enough. We need to be more holistic in our teaching. And it’s in our interests. If God’s people had heard as much from true economists and investment counselors, like John Templeton, as credit ministries, they might have more money to give today and invest to be able to give more in the future. 

Unfortunately, we won’t accomplish that if we simplistically ask “What would Jesus do?” He’d always sell anything he had and give it to the poor, as he advised the rich young ruler who was seeking perfection. Pretending we’re investing as Jesus would might boost the egos of some Christian investment advisors and
bring a few naïve dollars into their firms. But it dramatically distorts the nature of God by creating God in our own image. God knows any advisor and any company they might invest in have fallen far short of perfection.

But Jesus was realistic about human imperfection and respectful of the prophets. So I believe he wouldn’t mind if we imperfect investors ask: “What would Jeremiah do?” You may remember that Jeremiah once invested in a field (Chapter 32). But he didn’t do so when things looked sunny. He did when things looked very, very cloudy. That took a lot of faith. That’s why he did it at that time, rather than hoard his money until things looked sunnier. Still, I’m sure that he, as John Templeton famously preached, knew that prices are usually their lowest when things look their worst.

The corollary is that prices are usually their highest when things look their sunniest, as during early 2000. The political shadow makers were talking about Washington running surpluses that would allow it to pay off the federal debt. The financial shadow makers were talking about the “automatic” riches to be made in internet stocks as the Dow streaked toward 36,000, or even 100,000. So investors were telling the Paine Webber annual survey they expected to make 18% annually during the coming decade. But of course, when the market bottomed in March 2009, surveys revealed investors were their most pessimistic in history.

So how do you know in our media saturated world who is being prophetic and who is selling shadows? Begin by reflecting on Jeremiah 11 and 12. They talk about the plots on Jeremiah’s life just before he asks God why wicked men always prosper and succeed on this earth. Then remember Jesus’ caution to religious leaders to be careful when everyone speaks well of them as our Gospel of love is irritating to both those who want to fearfully hoard and/or greedily get rich quick. That is, Christianity’s hard but most enriching truth is that popular, successful shadow makers are very rarely prophets.

Please note, this article is Class Three of a series. Other Classes are available for viewing under the “Classes” tab.

“There are doubtless as many ways of associating Jesus Christ
with the responsible life as there have been ways of associating him
with the ideal life or the obedient one…The Christian ethos so uniquely
exemplified in Christ himself is an ethics of universal responsibility.”
—H. Richard Niebuhr
The Responsible Self

Last month’s column did a little preaching about the new philosophy of political-economics recently developed by secular libertarians. We focused on Ayn Rand who termed us Christians “sacrificial animals,” as well as Nobel economist Milton Friedman who taught the only social responsibility of a business is to make money.

Had either actually worked in the canyons of capitalism, or Wall Street, they might have better understood that even modern capitalism begins with us: 1) sacrificing consumption and 2) saving in a way that 3) creates a more abundant life for others as ourselves. Obviously, sacrifice, saving and ethical wealth creation are central concepts of the Christian faith. Trust lubricates the process. Lose them and you lose the foundations of the abundant life, as we learned in the recent credit crisis. 

There’s a scholarly new biography of Ayn Rand entitled Goddess of the Market. It’s written by Jennifer Burns, a professor of political science. She explains Rand’s philosophy very clearly: “Rand was blazing a trail distinct from the broader conservative movement, as indicated by the title of her second nonfiction book, The Virtue of Selfishness. Whereas traditional conservatism emphasized duties, responsibilities, and social connectedness, at the core of the right-wing ideology that Rand spearheaded was a rejection of moral obligations to others.”

Burns explains the political and theological battles between God-loving conservatives who believe we have a moral responsibility to love our neighbors as ourselves, and the elitist disciples of Rand who don’t think so.

For example, in the area of charity, Rand famously told Playboy magazine: “What I am fighting is the idea that charity is a moral duty and a primary virtue.” She consciously worked to turn her values, like selfishness, into virtues, as indicated by The Virtue of Selfishness.

The result, as we now know, was stated by Nobel economist Daniel McFadden in the August 21, 2008 edition of The Wall Street Journal is:

“What’s been lost is the idea that a banker has some responsibility to protect the client’s interest.”

Yet it wasn’t “lost”; it was moralized away so our cultural elite might make a buck on Wall Street and our politicians might maintain power. The rest of us are now quite skeptical, perhaps cynical, of not only them, but other elites as well. 

Yet you can still go to the website of Friedman’s contemporary at the University of Chicago, Nobel economist Gary Becker, and find he’s still preaching the philosophy that businesses basically have no social responsibilities other than to make money through whatever is legal. (http://www.becker-posner-blog.com/archives/ 2005/07/do-corporations.html.)

Adam Smith, who most businesspeople consider an advocate of laissez-faire economics as they’ve only read The Wealth of Nations, began his book The Theory of Moral Sentiments with this thought about being human: “How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortunes of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it.” It’s the ageless story of Scrooge and Tiny Tim. 

Now we should meddle by addressing our personal finances. We on Main Street and Church Street usually find Rand and Friedman’s philosophies to be abhorrent. Yet very few of us consider the social consequences of our investments. In the words of noted Wall Street critic Michael Lewis in The New York Times magazine on June 6, 2004:

“The investor likes to think of himself as a force for honesty and transparency, but he has proved in recent years that he prefers a lucrative lie to an expensive truth. And he’s very good at letting corporate management know it. Investors, in their short-sightedness, encourage companies to neglect their social responsibilities.”

In the church, this is accomplished by the theology of Andrew Carnegie that it’s no sin to get rich as long as we don’t die rich, or that we can make money even as robber barons assuming we give it all away before we die. That theology created enormous misery for Christian CEO’s like Ken Lay of Enron, Bernie Ebbers of Worldcom and several people I know. Yet some ministries still argue we can be Christian in portions of our lives, or times of our lives, without being in other portions and times. 

During the nineties, two of the most visible evangelical planners in the country, who always strongly advocated charity, actually discouraged the consideration of social responsibilities when investing. They usually made the case that ethics simply have to cost you money, not realizing that simply investing for the most money possible is precisely the philosophy of Rand. Today, the website of one of the most popular financial celebrities who promotes “Bible-based” debt management also discourages ethical investing.

The Bible suggests ethics must be a part of every act of wealth management. (See particularly Ex 21:28 which says the habitual failure to manage wealth, even the relatively small wealth of biblical times, in a responsible fashion was a capital offense, and Ex 21:33, 22:25, 23:4, 23:9 and 23:10). 

So how might we be faithful with stocks, bonds and CD’s rather than sheep and vineyards? First, imitate the holistic consciousness of Christ; and understand that’s not simply sound theology but sound economics. It’s highly doubtful the two hundred billion dollars of charity we give each year can repair the damage that can be done by the world’s two hundred trillion dollars of capital. Not only our giving but the use of our capital should be guided by the teachings of Christ.

There is peace of mind in understanding that we might need less welfare, government housing, and food banks if we invest in beneficial businesses that create jobs, affordable housing and so on. We might also need fewer bailouts if we invest in responsible banks and investment firms, rather than blindly seeking huge returns.

Second, do no harm to your neighbors. Simply look at the holdings of your mutual funds and see if you want your children utilizing their products. Are they irresponsibly creating problems for society, or taxpayers if you prefer that term? If so, consider socially/biblically responsible funds (socialfunds.com or dlsconsult.com.)

Third, do some good for your neighbors, particularly the jobless and poor. For example, there are smaller “community development” banks and credit unions that responsibly finance a better life for people from the inner-cities to Appalachian areas to Native Americans. You can now even earn market returns by lending your money to “micro-enterprise” or “micro-lending” organizations, including Christian ministries like Opportunity International on whose board I have served. It will lend your money as tiny loans to people who want to create absolutely life-changing jobs in the Third World.

Next, do this holistically rather than politically. You may hear conservative planners say you should assure the companies you invest in do not make contributions to liberal causes like Planned Parenthood. That’s fine. But the primary concern of biblical prophets was opposing the prophets of Baal. We might too if we’re not blinded by politics. 

For example, John Allison, the chairman of BB&T bank is a devout disciple of Rand. He recently told The New York Times that Rand’s philosophy will “be the dominant one in this country in 25 years.” According to Jennifer Burn’s book (page 297), the bank’s foundation helps that happen by being a major donor to the Ayn Rand Institute, which puts her philosophies into our schools, though Bibles are still unwelcome.

Of course, that funding originates with those who do business with the bank. In short, understand the Christ consciousness realizes we’ve all fallen short but we shouldn’t encourage that fallen nature. 

Finally, understand there is hope for America, as exemplified by the number of recent economic books suggesting some have learned their lessons about the need for our responsible morality. The senior editors of The Economist magazine have recently authored a book entitled God is Back and Robert Fogel, another Nobel-laureate, has authored The Fourth Great Awakening. Only one of those three authors is a believer but each sees major changes ahead that should be good for our nation’s businesses and financial system.

Peter Drucker’s Post-Capitalist Society specifically denounced Friedman’s teaching and suggested we are headed for a responsibility-based society. Last but not least, the Financial Times of London has recently published a series on The Future of Capitalism. One article by Lord Richard Layard entitled “Now Is the Time for a Less Selfish Form of Capitalism” said:

“Accelerated economic growth is not a goal for which we should make large sacrifices. In particular, we should not sacrifice the most important source of happiness, which is the quality of human relationships. We have sacrificed too many of these in the name of efficiency and productivity growth. Most of all, we have sacrificed values. In the 1960’s, 60% of adults said they believed ‘people could be trusted.’ Today, the figure is 30%, in both Britain and the U.S….So we need a trend away from excessive individualism and towards greater social responsibility. That is the kind of capitalism we want.”

I coined the word “stewardism” for our ancient kind of responsible capitalism to acknowledge its biblical roots and distinguish it from Rand’s new selfish and irresponsible kind. I hope, no pray, it’s the kind of capitalism Christians still want. 

Please note, this article is Class Two of a series. Class One is available for viewing under the “Classes” tab.

“Only compassion can save--the wordless knowledge of my own responsibility to whatever is being done to the least of God’s children. That is knowledge of the spirit.” —Peter Drucker

During the recent election, most of my conservative clients were concerned then-Senator Obama would try to “save” the world’s economy with greatly increased government spending. The senator even joked during the Al Smith dinner that it was not true that he had been born in Bethlehem; that he had instead been born on Krypton, where Superman was born. Few clients thought even that more humanistic role would save them. 

Yet no one seemed concerned when the cover of the November 8, 2008 Forbes, The Capitalist Tool, featured former presidential candidate Steve Forbes and the headline, “How Capitalism Will Save Us.” But despite my working on Wall Street and never having had a government job other than being an Army officer, it gave me pause.

During the mid-nineties, revered management consultant Peter Drucker wrote a prophetic book entitled Post-Capitalist Society precisely as he didn’t think capitalism would save us. Peter, as he liked to be called, had literally told Forbes magazine that executive compensation was “a disgusting spectacle” that reminded him of “pigs at the trough.” And he suggested there was anger brewing that would threaten our economic system. Though I was an advocate of moral markets and limited government, I had to sadly agree as I had too had witnessed egregious compensation at Wall Street firms. 

It was about that time I coined the word “stewardism” to distinguish markets integrated with The Puritan Gift, a book by two friends, from the “free” markets of modern capitalism. As St. Paul explained the paradox, we must be “slaves” to that ethic so we can live in true freedom and prosper.

During class one I mentioned that contrary to conventional wisdom, it was the earning of interest (Ex 22:25) and not debt itself (Lk 6:35) that was forbidden by the Bible. Yet Christianity has long grown along-side ideas that germinated in three soils of the Middle East: Greek, Roman and Judaic. Most Greeks, like Plato, were socialists, or communists, but essentially what we call “liberals.” Today, they’d favor governmental health care, Social Security and so on.

The Romans, like Cicero, were “conservative,” believing the only true role of government was to protect wealth with large armies. Today they’d also favor the FDIC, Homeland Security, border fences and so on. But the economic thought of Israel transcended both human approaches by claiming God owns wealth and we stewards should manage it within a Judeo-Christian moral framework. 

Faith & Wealth by Justo Gonzalez says those three ideas begat three different ideas about the earning of interest, and therefore capitalism. He quotes Socrates as saying the wealthy “do not want to prohibit the extravagance of the young (as) their intention is to make loans to such imprudent people…The money makers continue to inject the toxic sting of their loans wherever they can, and to ask for high rates of interest.” Apparently the Greeks allowed the earning of interest but considered it morally dubious. Yet Gonzales also wrote: “All the great writers of Roman antiquity are conservative (and) since the earliest of times, the maximum rate had been fixed at 1% simple interest per month, and this was generally the legal limit throughout the history of Roman legislation.” As the Bible attests, Romans weren’t known for loving their neighbors. C.S. Lewis confirmed Gonzalez’s perspective when he wrote these words in Mere Christianity:

“There is one bit of advice to us by the ancient heathen Greeks, and by the Jews of the Old Testament and by the great Christian teachers of the Middle Ages, which the modern economic system has completely disobeyed. All these people told us not to lend money at interest; and lending at interest--what we call investment--is the basis of our whole system [capitalism]…It does not necessarily follow that we are wrong. That is where we need the Christian economist. But I should not have been honest if I had not told you that three civilizations had agreed in condemning the very thing on which we have based our whole life.”

Notice three points: First, Lewis did not include the Romans as being concerned with charging interest. Second, he said the “great Christian teachers of the Middle Ages” had been. The Roman Catholic Church forbade earning interest until around 1500 AD. It was actually the Protestant Reformers who morally legitimated the earning of interest, if interest did not exceed 5% annually, the loan was for productive uses and not consumer purposes, and borrower and lender shared the risk equally. That change in moral thought helped legitimate banking, and therefore capitalism. Yet the Reformers continued to insist on interest-free loans to the poor. Luther actually taught: “Money lenders who do not want to put up with these terms are as pious as robbers and murderers.”

The Puritans brought that morality to America. In God and Mammon in America, Robert Wuthnow of Princeton tells the story of a Puritan merchant named Robert Keayne. In 1639, Keayne was thrown out of the First Church of Boston and was tried by the Commonwealth for dishonoring the name of God. His sin? Greed. He was earning 6%, 2% too much! 

Prominent mutual fund manager John Bogel recently began his book Enough with this quote: “The people who created this country built a moral structure around money. The Puritan legacy inhibited luxury and self-indulgence…Over the past thirty years, much of that has been shredded.”

Doug Meeks, who authored God The Economist, believes the church helped to shred that ethic. He wrote: “The way stewardship is practiced in North America often has little to do with the Bible. It stems primarily from the most influential American theologian, Andrew Carnegie.” Carnegie is famous for saying a man who dies rich dies disgraced. But during his time, he was considered a ruthless businessman.

Teddy Roosevelt once said: “I’ve tried hard to like Carnegie, but it is pretty difficult. There is no type of man for whom I feel a more contemptuous abhorrence than for one who makes a god of mere money-making.” It is no secret that some of the most notorious CEO’s of recent years--such as Ken Lay of Enron with whom I served on a Christian board; Bernie Ebbers of Worldcom; and Richard Scrushy of Health South--were highly visible CEO’s who also gave substantial monies to churches and ministries.

The summer edition of the most conservative Claremont Review of Books confessed other conservatives have consciously worked to keep
God out of American business: “Many of the most visible capitalist intellectuals--giants like Milton Freidman, Fredrich Hayek, and Ludwig Von Mises--embraced a new moral case for capitalism that decisively rejected the old one based on the natural and divine significance of the individual. This new moral case was, either explicitly or implicitly, utilitarian and anti-metaphysical.”

Freidman was the thinking man’s economist. But some of us wondered about his heart and soul. He once said, “The church tends to believe it should exercise control not only over the spiritual realm but also over the material realm, and that’s where all the difficulties arise.” In Post-Capitalist Society, Drucker pointedly termed as “futile” Freidman’s famous dictum that, “The only social responsibility of a business is to make money.”

I once wrote The Wall Street Journal that Freidman’s term for the Third World poor, “under-utilized labor units,” did little to encourage ethics, much less compassion, in global markets. And our credit crisis and recession were caused precisely by the new capitalism rejecting the Judeo-Christian ethic and foolishly believing lenders could charge even higher interest rates to sub-prime borrowers than to prime borrowers like myself. 

Yet the most secularizing of these capitalist philosophers has undoubtedly been Ayn Rand, mentor to Alan Greenspan, junk-bond king Michael Milken and tens of thousands on Wall Street and in corporate America. The Library of Congress has rated her book Atlas Shrugged the second most influential in America after the Bible.
That’s ironic as both Chuck Colson and Martin Marty agree they pretty much say the opposite, particularly about selfishness, which Rand deemed a “virtue.” At the end of Atlas Shrugged, Rand’s superhuman CEO savior makes the sign of the dollar across the world. It symbolized the moral purpose of our lives is now to make money, rather than to love God and neighbor. Yet in 1994, The Economist said Rand’s ideas were most popular with economic libertarians (who disdain government) and were instrumental in Reaganomics. Yet Rand taught “every argument for God rests on a false metaphysical premise,” charity is “not a moral duty,” and most importantly that capitalism and Christianity “cannot exist in the same man or in the same society.” She also taught that “abortion is a moral right” and had a very public affair. Not surprisingly, she died lonely and very depressed. Still, the head of BBT bank, a Rand disciple, recently told The New York Times that her philosophy of selfishness will soon dominate America. But while most church leaders ignore the root of all evil, evangelical leaders really avoid Rand. 

So what do you do if you too are frustrated about choosing between Nancy Pelosi and AIG for your health care and/or Barney Frank and Wall Street for your retirement? Begin by understanding the Claremont Review’s statement: “Nor did [these capitalist philosophers] have much to say to social conservatives, who are an indispensable element of the political coalition upon which capitalism’s survival depends.” It is a false political choice that we must become Greek if we’re tired of pagan Rome. There has always been a third way of stewardism. 

As Drucker wisely counseled, it’s a simple matter of accepting personal responsibility for what happens to neighbor, the least of these, the environment and future generations… when making money as well as giving money.  Wall Street calls that idea “socially responsible investing” (SRI) and “corporate social responsibility” (CSR). Drucker, who also taught theology, believed only that sort of love can save us. Finally looking up after all these years of looking left and right while studying political science and working on the Street, I can now see his point. 

“Whenever I tried to become wise and learn what goes on in the world, I realized that you could stay awake night and day and never be able to understand what God is doing. However hard you may try, you’ll never find out. Wise men may claim to know but they don’t.” —Solomon, Ec 8:16

I’m going to risk my credibility—and possibly your anger—in my first, and lengthy, article by suggesting few of us, myself included, really understand our nation’s finances, particularly our debts.

Why? I live a debt-free lifestyle, so I’m not encouraging more consumer debt. I’m a life-long Republican who’s served on a board of advisors to Jack Kemp and Bill Bennett, so I’m not trying to provide political cover for the Democrats. And I’ve been a critic of Wall Street ethics longer than most of my conservative friends have been critical of Washington’s ethics.

The simplest reason is that more of us simply must begin to pursue, rather than claim, truth about mundane matters, primarily as judgment begins in the house of the Lord. I deeply believe the theological, political and economic truth that a nation divided against itself cannot stand. And today, the church may be as divided politically, economically, racially and sexually as our nation.

That usually results in a huge deficit in grace, as demonstrated by the shouting in Congress, the rage on our roads and the anger on our radio stations and our athletic courts. Grace is destroyed whenever prideful humans claim the Godly characteristic of knowing it all. Historic Christianity deplored that; humanism has applauded it…to our spiritual detriment. 

Tap on a desk and ask your elementary school science class if it is a solid and they should answer “yes.” But ask students pursuing a Ph.D. in nuclear physics and they should respond: “No. It’s mostly space within rapidly vibrating atoms that are deteriorating according to the laws of thermodynamics.” Both groups are “correct” despite giving seemingly diametrically opposed answers. And despite many Christian’s skepticism of higher science, the second answer is actually closer to the biblical truth that our material world is passing away.

Similarly, some verses of the Bible seem to advocate the enjoyment of alcoholic beverages (Dt 14:26) while others seem to advocate abstinence (Pr 20:1). So while we can quote the verse we prefer and claim those who quote the other is wrong, in reality the Bible must say alcohol should be avoided by those for whom it is a problem but it can also enrich life for those with the maturity to enjoy it in moderation.

It’s much the same with debt. Most financial ministries deal with the very real pain it can cause day in and day out. So they quote Bible verses that seem to discourage it. I’ve even heard credit cards deemed “evil.” That’s one reason I’ve long preferred Willow Creek’s Good Sense Ministry’s approach. It cautions about debt without demonizing it, which is wise as credit can enrich life.

In the Sermon on the Mount, Jesus said we should lend to anyone in need at any time, especially the poor (Lk 6:35, also Dt 15:7). That means lots of borrowing, as Jesus demonstrated when he borrowed a donkey, upper room and tomb during Holy Week alone. What was actually forbidden in the Bible was charging interest, which no one now questions (Ex 22:25).) And some ministries suggest that if we do borrow, we have an absolute obligation as Christians to repay. Yet the true absolute of the Bible was seventh-year debt forgiveness (Dt 15:1, also Ne 5:10). There is no way a poor borrower can be worse off if he borrows interest-free and repays when possible.

It’s simply difficult for us to see those biblical concepts through the cultural screens of capitalism, with its golden rule that “he who has the gold makes the rules.” Yet our understanding of credit can still have dramatic consequences in the real world, particularly for the least of these, as demonstrated by the growing number of ministries doing micro-lending. 

Pragmatically, as an investment professional, I often witness Christians doing considerable good with their excess by lending money to growing cities that need water and sewer projects, schools, airports and so on. Yet I’d also argue our banks would be more careful in their lending practices if they understood more of us might default on loans that have become truly burdensome through no fault of our own. And one-half of bankruptcies are actually caused by medical emergencies. We need not add guilt to those pains.

Politically, it is rarely acknowledged in our age of cynicism toward government but some of us can remember that it was actually considered quite patriotic to lend to our federal government by buying war bonds during World War Two. And there is a case to be made that President Reagan wisely defeated the Soviet Union without firing a bullet by running up the federal debt for defense spending that bankrupted the Soviet Union when it tried to keep up. If you invested in a U.S. savings bond, Treasury bond or money market fund containing treasury bills during the eighties, you owned part of the federal debt. It helped enrich our nation’s future. And you considered it an asset that would help enrich your future rather than a debt that would impoverish it. 

Most of us can be forgiven for not understanding that financial version of nuclear physics. Yet for the sake of our spirits and finances, our Christian leaders, particularly stewardship leaders, simply must. Bruce Howard, who has chaired the economics department at Wheaton College, has written: “If there is one element in the market economy that has caused more confusion in the minds of Christians than anything else, it is the issue of credit…While it can be grossly misused, credit at its best is entirely compatible with traditional Christianity.”

While we have been focused almost exclusively on the morality of federal and consumer debt, our recent credit crisis and resulting recession were actually ignited by our Wall Street firms incurring excessive corporate debt in order to underwrite excessive mortgage debt for Americans. That is why Jesus taught the truth that we should remain on guard against all forms of greed, rather than simply politically correct forms. So despite credit cards causing some of us considerable pain and our federal debt threatening to increase sharply in coming years, let me explain why some knowledgeable experts haven’t lost all hope for the American economy. 

A new and scholarly book entitled Passing the Plate explores the sub-biblical giving in our churches. Crucially, it suggests economic perceptions can reduce giving as surely as economic realities. (As a man thinketh…) And it reiterated what the Financial Seminary has tried to say about credit card debt for years. “One commonly cited statistic in the media is that the average American owes $8,000 in credit card debt.” It concluded: “In short, while many Americans are no doubt ‘overspent,’ the possibility of most people drowning in credit card debt as the explanation for lack of generous religious and charitable giving lacks empirical support (page 64).”

Between those two statements, the authors explain the $8,000 figure is for those who have credit card debts they roll over each month. Yet 52% of us have no card or pay our balances each month. They also explain the affluent skewer the numbers higher so “the median balance was only $2,200.” That’s the reality for most of our members and the one we should be focused on as our nation obviously has far larger problems. 

As most politicians are as disinterested in good news as the media, our federal debt has probably been even more misunderstood. Most everyone knows the federal debt is now twelve trillion dollars. As a percentage of our national income (GDP), that is about half what it was at the end of World War Two at 60% verses 120%. And it is projected to rise to 120%, and possibly much more, again during my expected lifetime, assuming our wars and spending on retired boomers continue as is. It may even rise to the 240% level it was in Great Britain at the end of WWII.

Yet when we as individuals consider whether our mortgage is burdensome or not, we usually relate that debt to the value of our home, not simply our income. And I’ve never found one American Christian during twenty years of asking who knows the value of our American home. Yet that number is estimated each year by the same folks who estimate our debt. It simply isn’t the bad news favored by our media and politicians.

You can count your economic blessings as an American by going to this link and finding a balance sheet for our nation on page 199. It shows the latest estimate of our nation’s total assets as being $125.5 trillion. It also shows we owe other nations $7.2 trillion more than they owe us. So America’s net worth, after paying off all debts, at the end of 2008 was $118.3 trillion, or $388,100 per person. Noted economist Jeremy Siegel of Wharton recently wrote in The Financial Times: “Every dollar of US international indebtedness is matched by a dollar of assets abroad,” suggesting we can sell their equities if they sell our bonds.

Politically, we might more “honor and respect” our government if we notice the last line of the OMB balance sheet tracks our federal debt as a percentage of our assets. After the debt to income ratio, that may be the most important statistic for our policy makers in Washington to consider. Notice the trend has actually been in decline the past fifty years, from 10.3% in 1960 to 6.5% now.

That is similar to the condition of our affluent retirees in Florida. Some have relatively small mortgages. Yet as a percentage of their smaller retirement incomes, those mortgages are larger than they may have been a few years ago. Yet as a percentage of the retiree’s considerable assets, the mortgages are quite manageable.

Yes, as with a reverse mortgage for individuals, our nation will mortgage some of those assets to care for retiring boomers. Just remember that a lot of the spending will go to the medical professionals in our American family as, unlike cars, we don’t buy much medical care overseas. The balance will go to our fellow Americans as inheritances or our American charities as bequests. 

So what can you do with this knowledge? Simple: Proclaim the good economic news, perhaps simply by copying this article for your members. One affluent businessman I gave the nation’s balance sheet to keeps it on his desk to encourage visitors. Then the church might again be an oasis of gratitude and hope for our financially affluent but spiritually bankrupt culture grown cynical of politics, the media and Wall Street. 

Please continue your reading with Class Two, Salvation: A) Obama’s “Socialism,” B) Forbes’ “Capitalism,” or C) Neither?, available under the “Classes” tab.

“Behind it all was a man who could not bear to hear that Elvis still surpassed him, or that Madonna had won a Grammy when he hadn’t. He could force hard deals and millions of dollars out of Motown, CBS and Sony in face-to-face confrontations; he could fire his manager and his lawyer, after years of service, without a trace of sentiment; he could beat Paul McCartney to the Beatles’ back catalogue and exploit it ruthlessly, despite their friendship. He performed with his elder brothers for 18 years, then left them as brutally as he had always up-staged them…What show business required, Michael Jackson had also learnt, was to give them what they wanted. If they demanded fantasies, he would provide them. ‘The longer it takes them to discover who I am, the more famous I will be’…His glitter jackets, the tabloids claimed later, hid a body that was half-starved, subsisting on painkillers. Though he was worth $1.3 billion, said the Sun, he died with debts of $300 million. [More reputable sources put his assets at $500 million and net worth at $200 million.]”

The Economist
July 4, 2009

Yet disciples of Ayn Rand’s laissez faire capitalism to right-wing Internet conspiracy theorists are sure to beat Benedict’s ingredient of a “world political authority” to manage the global economy to froth. They don’t tend to be loyal diners at the Vatican café anyway. Right-wingers are sure to translate those three words into Benedict being the anti-Christ establishing one world government. Even Nobel-economist Milton Friedman wrote this after the Vatican’s last economic menu was published, which was far more limited in what it served up: “The church tends to believe that it should exercise control not only over the spiritual realm but also over the material realm and that’s where all the difficulties arise.” And sure enough, Benedict laid one egg squarely on Friedman’s plate with this sentiment: “Once profit becomes the exclusive goal, if it is produced by improper means and without the common good as its ultimate end, it risks destroying wealth and creating poverty.”

Friedman, of course, famously taught the only social responsibility of a business is to make money. That sentiment fueled the theory of “maximizing shareholder value.” That theory essentially subordinated customers, employees, citizenship and the environment to simple stock prices, though it did enrich many CEO’s during the great bull market. Largely due to Friedman’s Chicago School of Economics, the theory dominated our business schools, corporate executive suites and board rooms for decades. But even Jack Welch, former CEO of General Electric and a former high priest of the theory, recently termed it the “dumbest” business idea ever. Apparently, there is far less conflict between sound Judeo-Christian morality and sound business practices than some have taught during recent decades. For no other reason, business professors and leaders should chew on the encyclical.

From my perspective as the founder of The Financial Seminary however, the most important ingredient is not political, economic, or investment and management theory. Unfortunately, it is so subtle most are likely to miss the dynamic seasoning altogether. It is the Church’s responsibility for the current global economic crisis. Near the very beginning, Benedict confesses: “I am aware of the ways in which charity has been and continues to be misconstrued and emptied of meaning, with the consequent risk of being misinterpreted, detached from ethical living.” In other words, ask a hundred church-goers what charity means and ninety-nine, or more, will likely tell you it means giving money to the church and/or poor. And when charity, or the loving stewardship of our time, talent and treasure, is solely about money rather than ethical living, it is inevitable that business will be too. So our world may be suffering a credit crisis largely as “judgment begins in the house of the Lord” and that house has only expected one thing from businesspeople lately: money. So businesspeople only value that too. We should know better.

It hasn’t been that long since Pope John Paul II confessed: “The leading sectors of society have been neglected and many people have thus been estranged from the church. If evangelization of society’s leaders is neglected, it should come as no surprise that many who are part of it will be guided by criteria alien to the Gospel and at times openly hostile to it.” Morality also abhors a vacuum. That is why the Library of Congress says Ayn Rand’s Atlas Shrugged, which turned the Bible upside-down for Wall Street and corporate CEO’s, is the second most influential book in America, just after the Bible. That is surely a metaphor for a church-going but ethically challenged America.

Understanding the root of all evil affects even the Church, the U.S. Catholic Conference of Bishops once cautioned: “Concentrating on one specific obligation of stewardship, even one as important as church support, could make it harder—even impossible—for people to grasp the vision. It could imply that when the bishops get serious about stewardship, what they really mean is simply giving money.” I’m not sure we’d know how to talk about more than money if we even wanted to.

Noted Catholic theologian Michael Novak has written: “There exists no serious disciplined body of theological reflection on the history and foundations of economics. In few areas has Christian theology, in particular, been so little advanced. Corporate executives and workers, white-collar workers and teachers, doctors and lawyers—all have need of spiritual guidance. How can this be given until we have a theology as realistic as the work they do?” While “Charity in Truth” might encourage far more bishops, and a few more priests, to concentrate on more than fundraising, I’m not sure those in the pews will find it all that “realistic” in helping them with their everyday challenges at work.

That theological/realistic divide troubles far more than Catholicism, prompting the so-called “Sunday/Monday divide,” a term coined by Professor Laura Nash of Harvard, in the thinking of most Christian businesspeople. After studying mainline pastors, Professor Robert Wuthnow of Princeton concluded: “When we asked pastors to talk to us about stewardship, we encouraged them to tell us how they understood it in the broadest possible terms. Repeatedly, however, we found the church their only frame of reference. They immediately talked about serving the church, doing church work and giving money to the church.” Are businesspeople more morally challenged if they care only about their corporations and profits?

As with corporate leaders, the thinking of church leaders usually begins with our educational institutions. And evangelical stewardship leader Dr. Wesley Wilmer of Biola University has written: “The topic of finances is the one pastors most avoid. Fear of sermons on money is the chief excuse for not attending church and not bringing guests. And today’s seminaries, by their own admission, are extremely reluctant to take the lead in helping pastors and church leaders learn how to become better stewards.”

So if I might top off today’s eggs Benedict with a healthy serving of realism: If seminaries again teach holistic stewardship, future clergy may help business leaders remember there’s more to life than money; and we all, including future generations, might finally enjoy the more abundant life the Gospel promises.

“Another ideological god has failed. ‘Governments bad; deregulated markets good’: how can this faith escape unscathed after Alan Greenspan, pupil of Ayn Rand and predominant central banker of the era, described himself, in congressional testimony last October, as being ‘in a state of shocked disbelief’ over the failure of the ‘self-interest of lending institutions to protect shareholders equity.”
The Financial Times
The Future of Capitalism Series
March 9, 2009

“We act as though we are able to predict historical events, or, even worse,
as if we are able to change the course of history. We produce thirty-year
projections of social security deficits and oil prices without realizing that we
cannot even predict these for next summer—our cumulative prediction
errors for political and economic events are so monstrous that every time I
look at the empirical record I have to pinch myself to verify that I am not
dreaming. What is surprising is not the magnitude of our forecast errors,
but our absence of awareness of it.”

The Black Swan
By Nassim Nicholas Taleb

“As recently as Spring 2007, Mr. Paulson, among others, was arguing that onerous regulations were crippling American finance in intensifying global competition. Those cries are silenced. ‘The last twenty years saw people actually mouthing the idea that government should keep hands off,’ says Richard Sylla, a financial historian at New York University. ‘We had this free market ethos: Reagan’s ‘government isn’t a solution, government is the problem.’ Now people are saying, ‘The market is the problem. The government is the solution.’” The Wall Street Journal September 29, 2008