Archive for category: Wealth and Poverty

If you would like to comment on the March topic as a whole, please do so below.

My intellectual hero, Peter Maurin, once wrote about what happened when he went to a university looking for advice on his project to animate the economic order in line with Christian tradition:

A few years ago,
I asked a college professor
to give me
the formulation
of those universal concepts
embodied
in the universal message
of universal universities
that will enable
the common man
to create
a universal economy.
And I was told
by the college professor:
“That is not my subject.” 

So with Peter Maurin and Dr. McMullen both reminding me that an appeal to disciplinary specialization is not an adequate response, I’m happy to be pushed to say more about directions for action. But first I want to respond to Dr. McMullen’s interesting challenge to my focus poverty. He points out that my approach neglects the significance of the growing disparity of wealth between the middle class and the wealthiest. It’s a smart question, and I appreciate the chance to engage it.

Which inequality?

My emphasis on poverty is a function of my concern that no political party in the US is seriously campaigning to address poverty. Fighting for the middle class is a winning cause; fighting to end poverty —  to address food insecurity, lack of funding for educational systems in areas with lower property values, housing and medical care as human rights, a living wage, the rights of low wage workers to organize, and environmental justice — is not. In fact, it seems we have come to a situation where poverty is such a matter of shame that even people of good will prefer to talk about policies that will support the middle class rather than policies that support people living in poverty. Being a member of the middle class who is being driven into poverty is honorable, and trying to assist such a person in keeping and advancing that hard-won place is an appealing struggle. Being poor just doesn’t have the same cache. The Poor People’s Campaign, which is giving voice and public support to people in poverty, is turning the tables on that logic, amplifying the energy and intelligence of people who live in poverty, instead of brushing them under the table.

As I’ve thought about Dr. McMullen’s point, I’ve come to agree that this question— whose inequality we are focusing on— does indeed have to do with what we think a good outcome would look like. Are we still dreaming of a bourgeois respectability for everyone, or are we looking for a society that values its actual members, all of them, in our broken, pieced-together lives? I’ve been reading and re-reading Arundhati Roy’s new novel, The Ministry of Utmost Happiness, a powerful of that “new world” that Roy’s name is so tiresomely associated with. But the new world, as it’s found in that novel, is hatched in the breakdown of a traumatized misfit person who ends up living in a graveyard. Slowly the place where she has fallen off the edge of the world becomes a home she shares not only with the dead but with a host of others who have also fallen off the edge. It’s the island of misfit toys, with a cast of three genders and three religions, characters united by the tragedy and ordinariness of human life in their place. Meaning no disrespect to the author, it’s the most moving literary account of the kingdom of God I’ve seen in years.

So addressing inequality by starting with the humanity of those who have been discarded is precisely a matter of what we are aiming for. Rather than aiming for a society of self-enclosed individuals, I’m operating from a desire for a society of rooted in shared humanity, including sharing the irresolvably flawed, heartbreaking humanity we share.

Having said that, I will also say that I find Dr. McMullen’s reasoning about the civic importance of attention to the growing gap between the middle class and the wealthy quite compelling. I mentioned earlier the variety of studies that have shown a negative correlation between wealth and empathy, and the results of that alienation writ large indicate a profound civic problem. I have to revise my view in light of that. What is hidden by the frequent appeals for support for the middle class is the need not only to support those living in poverty as well as those being driven from the middle class into poverty. It is also the necessity of addressing the moral and social sickness of excessive wealth, particularly the damage it does to the persons who have it, to the society fascinated by it, and to the civic order that suffers from the alienation it produces.

Getting real

What about the importance of engaging particular policy questions?  Dr. McMullen argues that this work is important because it is the principle area of disagreement, because our efforts to craft solutions leads to a better understanding of the problems, and because in the end good intentions simply won’t get it done. He argues that theological thinking matters not only in setting ends for the economy, but in helping to determine right means, which is the really juicy question.

I appreciate the compliment paid to the discipline of theology. Too often the presumption, on all sides of the issue, is that theology, properly speaking, stops with the articulation of values or ideals and really has little to offer beyond that. That presumption is rooted in the belief that theology is about ideas rather than historical action or human communities. Some theologians will argue that that is exactly what theology is. I am not one of them. Christian theology is about God as known by a historical revelation and the community that lives by it and through the gift of the Spirit. So for Christian theology, a focus on God is a focus on events, people, and a social organization, as well as the texts, stories, and principles that animate those people.

So the beginning of my answer to the challenge to be more practical about “what we are to do” is to note the ambiguity in that “we.” Whose action am I going to talk about? I do not mean by this that I am concerned for the poverty and wealth of some people and consider other people simply outside the fold. I mean that it matters a great deal within what social, political, and eschatological framework we are proposing action.

The church has the framework and is the human community that most concerns me. Christian communities form a global communion that is a material and social network, but which for the most part imagines itself somehow as having no material power, no economic influence, no body in the world. Identifying that problem does not automatically produce solutions, but it leads to an entirely different set of questions, policy problems, and possibilities.  So here are a few suggestions I have about how that worldwide communion might recognize itself as participating in God’s incarnation in the world and take up the challenges of economic inequality.

First, in lieu of stewardship programs, churches should have offices of redistribution, their work re-envisioned in line with that title. The error of treating, in theory and in practice, the property of Christians as given to them individually by God and under their sole authority (before God, who is not on hand and therefore needs stewards) has to be confronted. Wealth can and should be identified as an ecclesial question: some members of the Body of Christ have far too much and some have far too little.

Discernments about what to do with that will be complex, so complex that I rather think avoiding them may be the real reason we have for so long accepted the theologically unsatisfying language of stewardship. Who will have the authority to lead this process, and what sorts of pressure would be used to bring about wealth transfer? The state has the power to compel. The church will be wise to follow a quite different approach, through catechetical, homiletic, and sacramental efforts, working structurally and intentionally to create a culture in which mutuality is constitutive of the joy of the gospel. One wise teacher of mine liked to say that when a person joins a Christian community, a step in admission should be disclosing his or her income and wealth. That would not require you to divest yourself of any of it, but it would be a necessary step toward communal discernment of what those who share in the Body of Christ ought to do about disparity of wealth in their midst.

Such local policies would make other kinds of ecclesial action more imaginable and more substantial. They could be associated with congregational-level work to understand the causes of poverty and to commit to collective work to address those causes. Such judgements, no doubt, will not always be easy to reach. They will open up conflict within congregations, requiring practices of conflict resolution. When reached, they may not be wise. The actions they lead to will not always succeed. Nevertheless, failure would be better than our current practice, which is leave all such questions to the preference of the individual believer, to leave our shared life at a superficial level, and to neglect the scriptural witness that calls for mutual love and material sharing among those who are members of the one body.

Likewise, once such local policies are in place and congregations are encountering wealth disparity in their midst (or the lack of it in their own congregation, which is another problem this approach would require us to address) and examining its causes, they will be better situated to be encountering those not in their own congregation who are also struggling to get by. In fact, the pagan emperor Julian complained that in his day that all of the poor were becoming Christian because Christians were more generous in their efforts to address poverty than the pagans were. What if all of the the poor of the US began to turn to Christian communities, wanting to join them because of their generosity? This would be a fantastic problem to have.

Again, in the US Christian congregations should be leading efforts to talk frankly and seriously about reparations for slavery. Christians are supposed to know something about confession, penance, and reconciliation (in that order), and so should be particularly well-situated to begin the work of examining the collective conscience concerning inherited injustice and structural supports for continuing inequality. The scandal that in spite of the role white Christian communities played in supporting poverty, those communities have typically not made racial justice a priority will not simply disappear on its own— nor should it. Part of our larger project of contending with inequality within the Body of Christ will have to be contending with a legacy inherited from Christians who believed the curse of Ham (or natural law, among Catholics) authorized slavery.

A slightly more abstract but enormously important policy change would be for congregations in the US to shift their talk about freedom, especially religious freedom, in a direction more attentive to economic realities. As I indicated in my first post, I see this as a key way in which we have not yet come to understand what the problem is. On the contrary, too often appeals to freedom actually obfuscate the issue. If instead of the churches carrying a banner for freedom as defined in the Bill of Rights, they argued for freedom as the freedom from sin encountered when participate in the life of Christ, we might be able to identify individualism and consumerism as obstacles to freedom. We might be able to talk about defense of the common good (as it affects congregations, neighborhoods, cities, the nation, and the world) as an act of freedom.

I grant that these proposals seem unlikely to succeed, at the moment. I take that to mean my fellow theologians and I, along with pastors and practitioners, have a lot of hard work to do.

But US policies?

The foregoing is not an attempt merely to evade questions about US policy. I am not oblivious to the power of government to affect economic inequality. It is  an undeniable force shaping not only the economic prospects but also the moral imaginations of its citizens, and so of course it cannot simply be ignored.

Engaging US policy questions theologically is a different project altogether than engaging ecclesial policy. The scale of ecclesial policy is both more global and more personal, but the difference is more difficult than that. The US, while always overwhelmingly Christian in number, has never been Christian in principle. Policies in the US are formed by what we like to hope is a fair procedure, a representative democratic process (aka sausage-making) in which consent of the majority is the functional standard. To be clear, that means the standard is not justice, and it is certainly not the gospel.

Advancing theological arguments in that context requires facing certain choices. Will we “translate” the theological argument into something more philosophical or better yet pragmatic? In that case, it is surely more efficient to make the philosophical or pragmatic argument directly, since that is what will actually matter. Will we make the theological argument to those who might be persuaded by it, in hopes that they can become an interest group or a voting block big enough to advance the agenda?  In that case, we have to face the accusation of politicizing the faith, dividing our ecclesial communities for the sake of judgments on which there can be conscientious disagreement. Given how polarized Christian communities already are, it’s probably more accurate to say that we would be making use of the divisions that clearly already exist, for the sake of party politics? Some of my colleagues  have gone this route, doing conscientious, brave, and hard work, hoping to use political struggle to address injustice and awaken Christian conscience.  I cannot bring myself to embrace that approach when I see the damaged Body of Christ, torn ever more by our attempts to fit the gospel into the alternatives currently available.

If I will not take those options, will I accept the designation of lending support to certain vague values and principles, and leave matters of means to other modes of reasoning? As Dr. McMullen has pointed out, that is abdicating the juiciest part of the work, the part that shows what our ideas are really made of.

I do not despair of influencing US policy. I am, however, highly skeptical of theological attempts to circumvent the work of discernment, formation, and organization within Christian communities themselves. Taking theological ideas directly into the practice of US policy-making without attending to the community for whom this is the world of God reinforces the paradigm by which Christian community has no body in the world, in which Christians only act as individuals in public life. I have seen some attempts to turn a creedal conviction (Incarnation, Trinity) into the basis for a particular policy, without a church movement behind it. These did little to help the policy and much to diminish the creedal conviction. The route I favor for influencing US policy is to work on healing the church–by which I mean all Christian communities united by baptism, though their division makes such appeal even more complicated than it already is– so that it can better play its role, for the life of the world and even for the life of the US. That role would involve economic creativity in practice, energetic work to analyze and address the causes of poverty affecting the church around the world, and a fresh encounter with the good news.

I admire Dr. McMullen’s posts. His initial proposals for tax reform, in particular, seem to me not only smart but also driven by a proper sense of the common good and human dignity. I could write a fine account of why I think that is so, with an eye to Catholic social teaching. I annually attend a conference full of scholars who do that sort of work. Watching them for the past twenty years has led me to think theology needs to take a different route, a route that is more rooted in the reality of how Christian language can meaningfully work in our polity. Once, moral theology and political economy were not distinct disciplines. What are they now? In a secular US economy, the work of sustaining a community of Christians who engage in discernment and organization on their own terms, which is to say in their own kind of politics, is the long-term struggle where I think theology can and should have legs.

Dr. McMullen and I could have fruitfully engaged a number of other questions related to wealth disparity: the logic and effects of war come to mind, as does the operation of debt (student debt looming large on the horizon), the Christian tradition of voluntary poverty (and its relation to peacemaking), and the language of hospitality. We have only touched on questions of power, especially labor organizing, and of state boundaries, as in questions of migration. Nevertheless, I do not regret the turn our exchange took. Dr. McMullen’s challenges to me have helped me to articulate and re-examine fundamental intellectual and vocational convictions. A strong challenge like that is an accomplishment and a treasure. I am grateful to him for this engagement.

First , I want to offer my appreciation for Dr. McMullen’s post, which avoids ideological home bases in favor of practical and serious work to promote human well-being. I know, because I faced it, what a challenge it is to respond to these questions, and I applaud both the clarity and attention to complexity that he captured.

A key area on which we agree is that questions of poverty and wealth are questions of moral import, political questions in the sense that they require discernment by a community about what is good. The economy is not just a procedure, a quasi-mechanical system; it serves an end. Economic interests do not necessarily create good results, if left to themselves, and some very important goods, particularly public goods, need to be fostered by means other than the market. Such goods are beneficial in ways that have to do both with a good business climate and also with humanity. In short, I found much in Dr. McMullen’s vision thoughtful and clearly driven by moral concerns as well as scholarship.

But that is not to say that I agree on all points. Some of our differences are a matter of disciplinary formation, but I want to begin by exploring some points on which I think we disagree, in hopes that Dr. McMullen might explore them further.

 

A story of global progress

I am aware of the numbers showing a significant reduction in extreme poverty in India and China, with rather different results in Sub-saharan Africa and Latin America. The danger is in turning those measures into the story that opening to the global economy reduces poverty. Dr. McMullen did not embrace that story, but he also didn’t repudiate it. In this case as in the others he referred to, there are reasons to be skeptical.

First, and principally, climate change means that path, as it has been trodden, cannot continue. In particular, fossil fuels, as he recognized in comments about the coal industry, are doomed to extinction, though they are dug in and clinging for all they are worth. While alternative fuels are ramping up, it is far from a given that global trade will be able to continue as it has, for the simple problem of transporting goods over great distances without fossil fuels. And poverty, driven by, for example, rising sea level,  extreme weather, ocean acidification, and drought, seems doomed to rise. Factors outside the usual economic indicators ones will have a grave effect on the safety and longevity of humans in the next century.

Second, when we note that in the US at the same time inequality— not just inequality, but that inequality that means people have sunk into more insecure lives and lost more ability to flourish— it becomes dubious to claim that this system, climate considerations aside, can continue to produce such results and that worldwide. I’m not arguing for an anti-business position: good work, in which people have not only a wage but some access to power so that the control of that work is in local hands, is key to ending poverty and honoring human dignity. Efforts that promote locally-controlled, sustainable business are important steps. But that sort of work is not what opening to the global economy is best at producing.

Third, there are qualitative issues involved as well, both for those in poverty and for the rest, and while they fall outside the boundaries of wealth disparity as such, they certainly are part of human flourishing. The damage done by the global economy credited with reducing poverty is soul-deep, insofar as to profoundly transforms our relationships to our producing and to other producers, to our land, and to our desires. Here I know I may be charged with raising a point of criticism without a constructive proposal, and I admit that it’s true. I don’t have the fix. But the point has to be made as well, that further growth of the global consumer economy is not good news, including for many of those in poverty, whose families and traditions and home places maybe their last wealth.

I am not happy to rain on such an important parade. Changes that result in more people getting an adequate diet and shelter has to be welcome news. But it’s important not to present this happy news as a simple win for the good guys, much less as a prescription for the future.

 

On the working of the market

Does our market economy create value and distribute wealth? As Dr. McMullen might point out, the answer is only partly yes. It’s the way the system is set up, to encourage production of goods people will buy, so that producers, by competing with each other, become more efficient and also earn profit. But that is theory, and the evidence in reality is far from that rosy. Producers are incentivized to produce what will sell for as profit, and that does not necessarily mean they are incentivized to produce what is actually good for human life. Schemes of planned obsolescence are one illustration; the existence of Kap’n Krunch would be another. Goods are sold and payment is made in return, but that is not to say that human needs are met, certainly not efficiently or prudently for the longterm.

In fact, insofar as the great economic problem is no longer that we have to encourage production in order to meet needs but that we produce so much that we have to stoke demand among those who have means to buy, it can be more accurate to say that the market economy has to create desires that can be profitably met in the short term. We can call that ‘creating value.’ But it that isn’t the same thing as filling human needs.

The way the market creates value is more dubious than it appears, on its face. And so is the way it distributes wealth. I’ll go ahead and admit that I have not read Picketty. But I would be curious to know what Dr. McMullen thinks of his evidence that wealth tends to accumulate more wealth, rather than to spread it around. I realize that his support for an estate tax would go some significant way to help address that dynamic. That corrective is necessary because of the functioning of the system, not because of its failure.

Dr. McMullen has been clear that he recognizes the limits of the market, that there are public goods and human needs that cannot be met by the market. Obviously, I agree. I think where we differ is that I don’t see how we can maintain a system where those are only a margin around a material order that is in the main organized by this system. Fundamentally, I worry that relying on the logic of growth to serve human well-being seems like relying on a cancer to sustain health.

Three alternate stories

I appreciate Dr. McMullen’s attention to the power of simple stories to shape our thinking, especially to shape it in such a way that we ignore contrary evidence. I’d be interested in hearing which parts of these stories he judges to be true and which false. As to his first story, people with little wealth are often risk averse, for the reason that even a modest loss could be devastating for them. When, in the early 2000s, many people of modest means were persuaded to take a risk by buying a house they would not have thought they could afford, part of the rhetoric that persuaded them to sign on was the claim that they should not be so risk-averse that they miss opportunity. Of course, when those loans went bad, the talk turned against them: what sort of foolish or immoral people had signed on for loans that they couldn’t pay? I cannot see that there is any the idea that poor people choose poverty (a few religious orders excepted)? Meanwhile, although some risk-taking is part of any successful business, investors are also very cautious about risk, and hedging to manage risk is a key element of finance.

As to the second story, dishonesty and manipulation are human characteristics, and no class has a monopoly on them. People who have superfluous wealth are not necessarily evil geniuses, any more than people lacking in what they need are necessarily always honest and caring. But corruption and injustice does play a role in causing poverty. As my own focus on historical injustices indicates, I think accountability for a history of such corruption is morally necessary. More worrying, because it indicates a more subtle and pervasive problem, are studies showing that greater wealth can be correlated with a lack of empathy do exist.

Meanwhile, every person who is poor has a story, and those may involve foolish choices, a lax work ethic,  or taking one step too many on the road to addiction. So may the stories of those who have plenty, for whom such choices have less drastic effects. 

While story #1 blames the poor and story #2 blames the rich, story #3 claims that it is no one’s fault. The appeal of this story, intellectually, is that it avoids simple good guy/ bad guy plot lines. Sometimes, things just happen. Economics, after all, specializes in unintended consequences.

In that way, then, the story indicates that technology and its social impact are in some sense out of human control. There’s good reason to say that: technology has a logic within itself, and our claims that we can control it, that we can use it for our own good, have repeatedly been shown false. We are creatures caught in “the technocratic paradigm,” (Laudato Si, Chapter 3) thinking initially that we are seizing control of natural power so that it would serve us, only to find after a time that we ourselves are the ones being controlled. I remain not quite satisfied with the usual solution, that we need to develop our moral abilities to catch up. But it is the best answer on offer.

What I want to flag here is that saying this was not a matter of human control is no consolation. There were human decisions, human actions involved. Sometimes we find ourselves in a moment of moral tragedy, where we have no good option. In such cases, honesty about our limits and courage in facing the results of our actions may be the best we can do. That is mitigation, but it is not exoneration. Since those who had the power to make the choices that had hard-to-predict or impossible-to-avoid consequences are not the poor who suffer from them, I find the claim that story #3 is about something that is no one’s fault less than convincing.

 

Last but not least, the Christian story

While I agree with much that Dr. McMullen says about Christianity, my reading of scripture and tradition differ in two significant ways.

One is in reading scripture as in the first place the church’s book, a book about the life of the church in the world. And so I give greater attention to the question of wealth disparity within the community of faith and as a matter of evangelical witness to the world. I take that approach not so much because I see something wrong with considering global economic relations without reference to the church, but because it is so rare to see anyone identify economic inequality as an ecclesial matter. It is, and for those of us who hold that the church lives from God’s presence with it, that that presence is a ministry for the sake of the world, the frustrations and vast possibilities of the church are at the center of the story.

The second has to do with the language of blessing and stewardship. Dr. McMullen points out, rightly, that land, herds, and children are counted as blessings in the Old Testament. They are distinguished by their ripple effect, their expansion to foster more life, more relationship, and the laws of the Torah (like the Jubilee) promote redistribution to ensure poverty does not become generational.

But the Bible certainly does not assume that all wealth is a blessing given by God. It can be wrongfully gained, and it can be related to vices of envy, hatred, and luxury.

When in the New Testament, we hear that the poor called blessed, while the rich hear “woe,” when the Blessed One himself has no place to lay his head, when he tells his followers to take up their crosses and follow him, to die to self, that is a development, not a contradiction, of the earlier view.  God intends humans to have full life, but we live in a world of sin. Often, when sin is invoked in discussions of economic matters, it comes up as part of an appeal to modest expectations. Sin is thought o mean that we cannot have a world in which there are no poor among us because sin prevents it, and attempting to correct that would create worse errors— totalitarianism, among them. I read the presence of sin to mean something quite different: it means Christians are called to bear with one another patiently, to endure the injustice of the world in a way that proclaims something new within it, to do penance for their own sins and for the sins of all in a spirit of confidence, in joyful hope.

That is not a claim that one could make for all of the world, since those who have not died and risen in Christ might find it simply bizarre (or might find something in it attractive, as can happen). It is perhaps not an economic claim, insofar as economics has since the late18th century begun to operate on philosophical grounds separate from the theological and even later from the political. It is, nevertheless, a claim Christians ought to hear. It’s costly, and it’s grace.

The most famous opponent of the view I just espoused would be Reinhold Niebuhr, who made a very persuasive case that such Christian ideals may influence individuals sometimes, but are useless in social ethics, as social bodies operate quite differently. Needing to protect their own, relying on the encouraging feedback from others in their group, social bodies will not be able to give up anything of their own power, unless they are forced to do so. After Niebuhr, the naive hope that Christian ideals could renew the world became the domain of the pious and ignorant. Real social ethics abandoned that path.

The evidence on Niebuhr’s side is impressive. On the whole, he was right to identify the way self-interest and self-deception operate in social groups. The exceptions are those cases in which Christians have acted as social bodies that are the corporate body of Christ. Christianity is not an individual calling, to be exercised in such limited ways as might be possible within ‘reality,’ which is not Christian. It is a corporate calling, to be a different people. This people cannot be a niche market, a utopian escape from the profane world. That’s not their calling, for one thing, but it would be impossible anyway. A third of the world’s population identify as Christian, across continents and social classes and races; that is not a small group who can withdraw into an enclave of delicious unanimity.

With that in mind, it may be clearer why I criticize “stewardship.” As a term Christians used to describe responsible ownership of wealth, stewardship took off during the English reformation, and from the beginning, it was a way of ensuring people that the wealth they had gained in questionable ways could be put to good use anyway. Whatever good that terminology may have done— and it may have done some real good in encouraging people to think of their ownership as limited by God’s more fundamental authority— it has conveniently displaced other Christian claims, such as the community of goods in Acts, the call to leave all and follow Christ, the penitential redistribution of Zaccheus, and the communal feasting required in the Torah.

Interestingly, the universal destination of goods is not the language used when my church calls for my contributions. The reason, I’m sorry to say, seems to be that the universal destination of goods is less liable to comfort and flatter those who have superfluous wealth.

Not all wealth has been gained unjustly. Not all business ventures are exploitative. But until the church is able to talk honestly and hopefully about real injustices, historical and present and looming into the future, it has not yet awakened the full moral sensibility needed to address our reality in boldness and joy.

There are few questions about economics that garner as much attention as those surrounding inequality. Over the last 30 years in particular, as we have watched income and wealth inequality rise in the United States, there has been considerable scholarly and popular attention to questions about fairness in our economic system. This attention is well-warranted. Christians, in particular, live in a tradition that has long questioned the morality of wealth and poverty, and has prioritized concerns about justice in the economy. Moreover, there have been dramatic changes in inequality in our lifetimes, both in the U.S. and globally, that are worth paying attention to. In this first part of our conversation I would like to set the stage by describing some recent trends in economic inequalities, then examine a range of explanations that are given for these trends, and then finally offer some suggestions for Christian thinking about inequality.

 

Domestic Divergence and Global Convergence

There are two broad trends in recent history that are worth understanding, just to set the stage for the conversation.  First, inequality in the U.S. has increased by a variety of measures since the early 1970’s. The trend is consistent enough that, while there is debate about the magnitude, significance, and cause of the change, the trend is not in dispute. For those who like to examine the numbers, a recent detailed report of income, poverty, and inequality statistics is available from the U.S. Census bureau here. One descriptive comparison from this report is characteristic of the last 40 years in the U.S.: between 1976 and 2016, the average household income in the lowest-earning fifth of the U.S. grew 7% after inflation, whereas the average income in the highest-earning fifth of the U.S. grew 71%. While the standard of living has generally increased for the whole population, the income and wealth of the most wealthy have increased far more dramatically. The incomes at the very top of the income distribution (those in the top 1%) grew much faster, moreover, than those in the top 5% or 10%.

At the same time, globally, inequality has been diminishing and there has been faster economic growth, on average, in historically poorer parts of the world than in historically richer parts. While inequality had grown worldwide for some time, since the 1980’s, there have been consistent declines in absolute poverty and improving circumstances for the many of the poorest parts of the world. In recent years, in fact, world-wide extreme poverty has declined faster than ever before. As a counterpoint to the statistic I offer about U.S. growth in inequality, based on calculations I made using numbers from this study, between 1988 and 2008 the average income of the lowest-earning fifth of the world’s population increased by close to 30% while the average income of the richest fifth of the world population increased by only 13%. While the very richest people in the world saw incomes grow faster than anyone, the incomes of those in 70% to 90% percentiles grew slower than the rest of the world.

In short, there is a broad trend toward inequality within the U.S. and in other countries as well, but at the same time, there is a parallel trend toward more equality worldwide, driven by rapid gains among the poorer parts of the world, and very slow gains by those at the bottom and middle of the income distributions in richer countries. The fact that the world is becoming more equal does not, of course, give us reason to ignore the dramatic differences in standards of living around the world, but it does offer hope that things can get better. For much of the remaining part of this essay, I will focus on the growing domestic inequality. We can come back to the positive global trends later in the discussion.

 

The Stories We Tell about Inequality

As we start to think about a Christian response to these issues, I would like to first note that there are three different kinds of narratives about inequality that are common. The kind of story that we think is the most accurate will also often determine the degree to which we think inequality is a problem, and what, if anything, should be done about it. Consider each of these in turn.      

1. Rich people are productive risk-takers, poor people have chosen poverty.

If we believe that people who are wealthy got to their position, most of the time, through hard work, talent, and delayed gratification, then it is easy to see them as heroic figures. Similarly, if we believe that people who are wealthy usually get that way by providing valuable goods that people need and want, then wealth creation is pro-social and laudable. Along the same vein, if we believe that the primary reason why people are poor is that they have made poor choices, it is easy to dismiss their hardship. This combination of assumptions will usually lead to the conclusion that inequality is not a moral problem. On the contrary, it might be the sign of a just system. To be consistent with this narrative, the rapid in equality growth over the last is usually explained by social breakdown in the U.S. among those with low income and education. While it is rare for this kind of story to be told in a form this blunt outside of the pages of an Ayn Rand novel, many of the arguments of economic conservatives in the U.S. follow this kind of narrative.

2. Rich people are corrupt, poor people are exploited victims.

If on the other hand, we flip the script, and make those who are rich the villains of the story, it is easy to argue, instead, that the richest Americans, usually those in finance or in the leadership of large corporations, have worked to rig the economy in their own interests, and against the interests of the working class. Poor people, on the other hand, are painted as the victims of this corrupt capitalism, with little bargaining power and few advantages in a winner-take-all game. In this story, income inequality is sign of injustice. Under this narrative, the domestic rise in income inequality is likely to be explained by political and economic victories by those who serve the interests of the wealthiest citizens. While, again, the narrative is not always painted this starkly, a story of this type is often told by those most economically progressive.

3. Structural economic changes have caused economic inequality to increase

The last kind of story we tell about inequality is that there is some large shift, largely outside of our control, that has changed the economy and caused increased inequality. For example, some have explained inequality in terms of broad trends in education and technology, arguing that technological developments have tended to reward those with the right set of skills and education, and have replaced workers with less education. Sometimes described as “skill-biased technological change,” this explanation is exemplified in a 2010 book by two Harvard economists. Other stories in this genre include references to increased international competition, immigration, the rise of internet commerce, and declines in aggregate productivity as explanations for the rise of economic inequality. This kind of story about inequality is usually favored by economists, and it tends to leave issues of justice outside of the story altogether.

One of the reasons why this topic is so difficult is that all three of these narratives about inequality are true, in some respect, and all of them are also problematic. First, consider the first two narratives. There plenty of anecdotes and statistics to support both stories, and so it is easy to fall into one camp or the other and assume that the other side is horribly mistaken. Part of the temptation of these kinds of narratives is that they each give convenient cover for a political program, either on the right or the left, and they identify clear heroes and enemies. People on the right can dismiss concerns of those on the left as being motivated by envy, people on the left can, in turn, assume that the concerns of those on the right are motivated by privilege and greed. Both of these stories see the economy as exemplifying a struggle for justice.

While I find all three stories convincing on different days, I usually lean toward the third kind of narrative. In the midst of our ideological battles, it is easy to miss that there are big structural changes in the economy that are slowly pushing us toward inequality. Moreover, we can usually have a more productive conversation about how to address inequality if we avoid the kind of characterizations in the first two stories, and pay close attention to broader economic forces.  The danger in this third kind of story is that it allows scholars to pretend that inequality is merely a technical problem, and ignore the fact that these broad trends are made up of smaller story arcs about hardship, discrimination, luck, lifetimes of hard work, unemployment, crime, exclusion from community, and culpable opulence. That is to say, there are substantial moral questions at stake.

 

How should Christians think about inequality?

Christians can be found across the political spectrum, making many different arguments about inequality. I cannot speak for the Church broadly, but I can draw upon a few themes that have motivated Christian thinking about the economy and explain my current approach to the topic.

In the Bible, and the Old Testament in particular, property and wealth are often framed as a blessing that allows someone to provide for their own needs and the needs of those around them. Moreover, the treatment of wealth in the Sabbath laws seems to prioritize the inclusion of everyone in the economic community. Anyone who had more than they needed was obligated to include others by giving loans, jobs, or gifts to sustain them. Extraordinary wealth, moreover, clearly gives one the power to include others in the community or exclude others from their calling, a danger is highlighted throughout scripture. In the bible, it seems that the economy is a system that has a particular end: the sustaining of the life of a community, and the inclusion of everyone in that community. In Catholic theology, this has been summarized in the principle sometimes called “the universal destination of goods.” My Reformed friends have usually included this all under the theme of “stewardship.”

An emphasis on this starting place pushes my thinking toward the theme of participation in the economy as a key element of economic justice. In particular, much of the recent trends in inequality can be thought through in terms of people’s ability to participate in the process of wealth creation. The wide global divergence, and now convergence in income follows a long period in which many people around the world were politically and geographically excluded from the global economy. The recent declines in global inequality have resulted from the inclusion of huge populations in China and India, where trade, specialization, and education are dramatically changing the lives of millions in a short period of time, and where extreme poverty is on a fast decline.

Within the U.S., much of the reward from dramatic increases in production have gone to those who are able to take advantage international trade, advances in technology, and mass markets. Those with little education or those separated from global markets by geography or social standing are left with fewer opportunities and increased international and domestic competition. There is a real long-term danger that, left to current trends, we would find that there is ever less investment in common public goods, and less investment in those institutions that create broad opportunity. To counter this, Christians should serve their neighbors by devoting their resources and political energy toward sustaining those institutions — like education and health care — that allow us to invest in people’s ability to pursue their own calling. We should likewise be careful to limit the ways in which the rules of the economy can be rigged against those without economic power, such through regulation that favors established corporations, or an excessively punitive justice system that locks people out of the economy through debt, incarceration, or deportation.

 

Redistribution of Wealth?

What we call “capitalism” or a “market economy” is a way of doing two things at the same time: it is a method of allocating people, technology, and resources to create things that people value, and it is also a way of distributing the wealth that is created. It is tempting to separate these two: leave the market in charge of making stuff, but let the government step in when it comes time to distributing the gains, so that the result is more equal.  The problem, of course, is that one of the reasons that our economic system is so good at making goods and providing services, is that we tend to reward people (with income) as a result of doing something that people find valuable and scarce. This means that sometimes when we redistribute wealth, we also end up decreasing the total amount of wealth there is to share. We fight, politically, about which is more important: creating more valuable goods and services, or equalizing the distribution of rewards.

Given my concern about participation in the economy, I tend to be most concerned about people being left behind despite hard work. It may be that creating institutions of opportunity is not enough. Even among those with an education who work full time and who obey the law, there is still rising inequality. Unfortunately there is no guarantee in economics that trends in technology and trade will always bend toward rewarding hard work. I tend to think, then, that in the U.S., we should move toward more redistribution in the economy, following two principles:

1. Survival of the fittest for products and production methods, not people.

 There is an element of a market economy that has a Darwinian flavor. The competition and innovation that drives progress and productivity is an unforgiving force. The once dominant tech giant, Kodak, was reduced over my lifetime to a fraction of its former size, largely replaced by new products and technologies. People can build up long successful careers, only to find that their skills have become obsolete and jobs scarce. While we count on competition to make sure that resources are used efficiently, and to drive the development of new and better processes, too often the casualties of this competitive process are people, not just bad ideas or obsolete organizations. If we are going to embrace market competition, and fast-changing technologies, then we should also embrace a robust safety net for the individuals whose lives are turned upside down. In addition to our current programs, I would like to see universal health care coverage, cheaper college education and training, as well as a more robust guarantee against hunger.

Too often, our political efforts flip this principle, trying to save corporations and industries rather than people. Our current administration, for example, seems intent on saving the coal industry, despite the fact that the decline of coal is well-warranted in the face of cleaner and ever-cheaper energy alternatives. This is a really inefficient way to help coal workers, since propping up this industry will only delay the transition to other industries that could serve these people much better.

2. Progressive Taxation

Taxation is a means to an end, and is never popular. In order to fund the kind of safety net and investment in public institutions, however, it is an important element. I start with the premise that material wealth has a purpose, and that those blessed with wealth have a calling to support and care for creation and the people nearby. Those who have an abundance of wealth and who are not using it to support those in need, therefore, are not “owning” their property properly. The moral claim that they have on their property is weaker. This sets the stage for a three-fold justification of progressive income or wealth taxation, when combined with a generous charitable giving exemption.

• Those with greater income or wealth have a greater ability to contribute to taxes without suffering comparable loss.
• Those with great greater income or wealth, if not putting it to good use, have a weaker moral claim to their wealth, and thus can be taxed more.
• Progressive income or wealth taxation pushes against inequality, even if it does not address the underlying causes.

The other large check in our tax system on economic inequality has traditionally been the estate or inheritance tax. It is only in recent years that this has become the target of conservatives, to the point where the estate tax is much lower than it had been. While there can be a legitimate debate about whether people should have a protected right to leave large amounts of wealth to their children, the estate tax on large estates is preferable to other methods of taxation, for two reasons.  First, there is a lower efficiency cost to this kind of tax than there is a comparable tax on income, since people are less likely to adjust their productivity and earnings because of the estate tax.  Second, this tax can limit people’s ability to become wealthy solely through birth. When comparing those who earned and saved their money to those who inherited it, the former has a stronger moral claim. A high estate tax, a progressive income tax, and comparable taxes on income-generating assets, therefore, are good ways to fund the kind of redistribution of wealth that makes up a reliable social safety net and investment in public goods.

 

Economic Opportunity?

Sometimes, when we imagine a “land of opportunity” we immediately jump to inspiring rags-to-riches stories. I would like to conclude by reiterating that the rising inequality among a population measured in the hundreds of millions cannot be explained by the virtues or vices that make up these kinds of stories, however, and instead probably reflects a growing divergence of opportunities and higher stakes across the board. Like some of my colleagues, I fear that people are less able to participate in society in a reasonably secure and healthy way because of these changes, and that the power and position of the wealthy will only become more pronounced. We can make choices that will counter this trend, but they require a political consensus behind paying the price for broad investments in the whole population.