An interview with the author of Economic Parables:
Author David Cowan states, “The debate about the economy is more out of control than the economy itself. This talking down of the market is creating a self-fulfilling prophecy.“There is an illusion that the economy will look after us. It is not a function of the economy to do this. Ever since God sent Adam into the garden and told him, ‘Life’s gonna be tough!’, we have had to find ways to negotiate conflicting wants and needs in the world. This is what the economy does. We need to use the good times - as a country, as households and as individuals - to prepare for the bad times. We have lost the habit of our grand-parents of doing this, which is why we have such a mess today. In downturns we can get economically punished, but remember that in the alternatives of Socialism and Communism, and in high tax regimes, we get punished ALL the time.”
Below, Cowan addresses questions that many of us are asking about the current economic situation:
Who is responsible for this mess?
We all are. The current crisis has to be put into perspective. In some ways, we have become a spoiled society, only happy in the good times and unprepared for the bad times. Unlike our parents and grandparents, we only think of things getting better, but this is unrealistic. The economy has its own rules of gravity, what goes up will come down. We didn’t hear complaints when it was easy to get loans, without backing it up with any assets, but now the markets have gone against us we don’t want to take responsibility.
Will the bail-out work?
The bail-out will have to work. Not because it is wise, sadly, but because that is what the loudest voices are baying for. On the plus side, there is an opportunity for government to make money and return a profit to the America taxpayer a year or two down the line. This was done back in the 1930s, the Home Owners’ Loan Corporation, and again in the 1980s with the Resolution Trust Corporation in the Savings & Loans bank failures. On the negative side, there is the possibility the profit could just get squandered by various lobbied interests and government bureaucracy.
Is this is all the fault of bankers?
It’s easy to attack the fat cats of Wall Street, and they deserve a lot of criticism. But what about the big pay-outs to sports stars, movie stars, celebrities and others? Isn’t it the case that we have a culture of greed? This is a tough thing to say, which is why you won’t hear the politicians say it, but we all share the blame. There is a gambling mentality in our economic behavior. We’ve all - not just the banks but all of us - been putting our chips on red and now the market has gone black we look for someone to blame. Too many of us, on Wall Street and Main Street, have been managing our desires unwisely.
Is this proof that Capitalism doesn’t work?
This is not the time to question the future of Capitalism. It is not a question of whether Capitalism works or not. It is not a time to go back to the tired old debates of the last century about Capitalism. The alternatives like Socialism and Communism caused oppression, and they were unsuccessful. We still believe in democracy, even when elected leaders have become dictators. Equally, we still have to believe in Capitalism, even when we see irresponsible leadership in the market.
What is the way forward?
This is the question to ask: what kind of market do we want? The answer should not be a kind of European Socialist-lite. It should be about robust Capitalism, made robust by effective regulation, increased individual responsibility by all, and greater accountability of financial institutions and businesses so that managers actually know what is going on in their organizations.
What should we do as individuals?
What is happening right now is a bleak message to us all; we know that. But there is a bleaker message when we do not listen to Jesus when he says in the parable “You can’t take it with you”. If you are hurting right now from this economic crisis, you have to ask yourself what you have left, and you should see indeed there is much left, for there is the love of Jesus in your life. Just like the economy, this is an opportunity for you show Him that you can go through the bad times with him, not just the good times.
What questions should I ask of myself?
Many people, as they find their material life difficult, will also find they have nothing left in the spiritual bank, because they have based their life on material things. If we base our life on the parables, we learn that Jesus tells us to use our worldly wealth wisely, so this is a time to ask, did we do that? Did we do that economically? And more importantly, did we do that spiritually?
I’m surviving, what should I do?
The faithful who have managed both their economical and spiritual wealth wisely, this is a time for you to reach out into your community and see how you can help people in trouble. Help people with debt counseling, and give people spiritual counseling. When 9/11 and New Orleans happened we knew we had to reach out. This is an economic storm we are in, we need the same approach, money doesn’t make it different.