At Work & Economics 101 & Public Square & Theology 101

Is Wealth Created or Transferred?

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Last week we asked whether or not free enterprise is a “win-lose” proposition. This is the myth of the Zero Sum Game, and it’s a myth closely linked to the next one in our series on the eight most popular myths about wealth, poverty, and free enterprise.

Myth #4: The Materialist Myth – believing that wealth isn’t created; its simply transferred.

A common image of this “Materialist Myth” is a pie. The economy is a fixed pie, and if one person gets too big a slice, someone else will get just a sliver. If you gain wealth, someone else lost it.

The “Materialist Myth” is rooted in materialism, a worldview stating that matter is the fundamental reality, that everything derives from matter, that matter is all that matters.

Christians acknowledge that matter is real and useful. God did declare his creation “good.” However, the opening chapters of Genesis give us a more robust view of the material world than materialism provides.

Matter Isn’t All That Matters

In Genesis chapter one, we see God speak creation into existence, creating it out of nothing. On the sixth day, God creates humans in his own image. Genesis 2:7 offers the details of this particular creative act:

The LORD God formed the man from the dust of the ground and breathed into his nostrils the breathe of life, and the man became a living being.

We’re made of dirt, and we’re made to work with dirt – and yet we have in us the very breath of God. We’re drawn from the ground but still transcend it. The way we work, then, should reflect the fact that we are a unity of matter and spirit, of heaven and earth, neither pack animals nor angels.

What’s more, the cultural mandate stated in Genesis 1:28 tells us that as Creator, God has made us with the awesome power and responsibility to create. God commands us to create according to our power to “be fruitful and multiply, and fill the earth and subdue it.”

Thus, Genesis tells us that:

  • Man lives in a reality that is both material and immaterial.
  • We were created with the ability to create.

This bears implications for our ability to create wealth. The “Materialist Myth” denies that wealth can be created. What exists is all that exists. We can bring nothing else into existence. This myth stands in contrast to what Genesis 1-2 tell us about human nature.

These chapters of Genesis aren’t economics texts, but they still cast light on the most important truth in economics: not only do we create wealth, but, in the right circumstances, we create even more and more wealth. We can look back on history and see this. Our ancestors slowly transformed the material world around them to create new wealth. The “Materialist Myth” makes this easy to miss.

Wealth & The “Materialist Myth”

Materialism is in the air we breathe, so it shows up in our thinking without our even realizing it. Most of us naturally think of wealth as purely material.

Although we link wealth with material possessions – with stuff – the essence of wealth, even though it involves matter, is immaterial. New wealth comes not from matter alone, but from how we represent, inform, and transfer matter. For instance:

  • Property laws allow physical assets like land to take on a parallel existence in the abstract realm of legal representation. In this way, land becomes property, then capital that can be used as collateral for loans, or to be compared or combined with other assets.
  • Money is the physical reality that represents wealth or capital. Units of currency measure how much capital someone has accumulated.
  • The modern computer revolution developed from discoveries in coding information. We now use material like sand to make computer chips and fiber-optic cables – the brain and nervous system of the immaterial, global information system.
  • Most of the vast new wealth created in our economy relies on symbols and information such as calculations of interest in a bank, modulations of radio waves and microwaves in the air, and laser beams riding tiny tubes of glass – fiber-optic cables – across the bottom of the ocean.

Using our creative capacities, we’ve figured out how to combine the material and the immaterial to create new wealth. This means that the “pie” isn’t fixed. We can create wealth, not only for ourselves, but for others as well.

How do you view the economy? Do  you think it’s a fixed pie, or do you think wealth can be created? Leave your comments here

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