At Work & Economics 101 & Public Square

Do Free Markets Inherently Lead to Exploitation?

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No one ever likes being misunderstood. The Institute for Faith, Work & Economics (IFWE) believes that’s happened to us in the latest issue of Christianity Today.

In a September 2014 article, author Kevin Brown, an assistant professor at the Howard Dayton School of Business at Asbury University, writes about what he sees as the negative consequences of capitalism.

Brown quotes from IFWE’s three and a half minute video “I, Smartphone,” released in 2012. The video depicts the seemingly miraculous aspect of the free market exchange process which brings together the gifts and resources of the people and nations around the world to produce something as advanced as the smartphone.

The video is a rendition of a famous essay, “I, Pencil” penned by Leonard Read in 1958. The essay has had a lasting impact on how many people think about the market process.

Why would IFWE care about how a smartphone is made, and why did we even make the video? Because we want Christians to better understand that God has given us the market process as a powerful tool to be used to bring about flourishing in our communities, our country, and the world.

The market process is a “common grace” gift that God has given to not only Christians but to all of mankind. Yet as Christians we have an important part to play in the process by being salt and light in a way that supports scriptural principles like rule of law, human dignity, honesty, and property rights that are necessary for the market process to operate effectively.

After the discussion of our video, Brown points out some of the greed, corruption and horrific abuses to innocent people that have surrounded some of the illegal mining and smuggling of certain minerals from the Congo by militias. These minerals are required for smartphones.

In the way he’s written the article, it appears that IFWE is among those who overlook these abuses in an effort to “deify” the market system. This could not be farther from the truth.

In fact, markets require a well-functioning rule of law. Market processes cannot operate well where rule of law is non-existent. It is not the voluntary trade between individuals keeping the Congo under militia rule. It is precisely that the people living in the Congo lack an institutional environment allowing them to use their gifts and skills to mine precious minerals in a legal way.

What is happening in the Congo is an illegal use of the market in the absence of the rule of law.

Markets have not exacerbated poverty in the Congo. It is the lack of markets and rule of law keeping the militias in power and keeping people poor. The unique question at hand is how to best help those living under such circumstances. One way to do this is to find ways to trade and do business with legitimate Congolese businessmen and women.

Like Brown, IFWE sees that the market is not perfect. Yet it is the best known way to lift entire nations and peoples out of poverty. Based on current data from the World Bank, the percent of the world’s population living in extreme poverty has decreased from 52% to 21% over the last thirty years.

The World Bank report goes on to suggest if this trajectory continues, extreme poverty will amount to about 3% of the overall population (known as transitional poverty) by 2030. This is happening because of the expansion of free markets in a number of countries around the world.

However, this market system is as fragile as it is robust. We must remember that we live in a fallen world, and although the market system may be the best system, it is far from a perfect one. We strongly agree on this point with our friends at Acton Institute:

Markets display both the virtues and vices of a people. It is important to avoid the temptation to either idolize the market or to suppose that virtue is something that can be politically implemented by bureaucrats. Strengthening the moral content of a people through civil society is the best response to vice, rather than burdensome regulation that inhibits human freedom and stifles innovation and creativity.

That’s why we at IFWE focus on your work so much. We want believers in Christ to know and understand God’s call to them in the workplace and how it advances God’s coming kingdom. You play an essential role in promoting these Godly virtues of hard work, integrity, honesty, and caring for the dignity of every human being.

We are glad to see Christianity Today’s special series of articles on these topics depicting a Christian view of market systems such as capitalism and how to best serve the least among us. The issues raised are complex and there are no simple answers.

At IFWE, we aim to analyze these issues first and foremost through the lens of Scripture. We also seek productive and respectful dialogue with those well-intentioned Christian brothers and sisters who, like us, are seeking to find solutions but may end up with different conclusions.

In an effort to shed more light on this topic, we have asked a number of Christian professors across the country to speak to these issues. You’ll be hearing from them later this week, when we feature them in an online forum here on the blog.

We’d love to hear your thoughts, too. Feel free to leave your comments below.

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