It Takes More Than Markets to Address Poverty
A frequent critique of market economies is that some people end up poor. Depending on your definition of “poor,” this is a truism. If “poor” means the bottom 1%, 10%, or 20% of the wealth distribution, and you aren’t going to equally distribute wealth to all members of society, then by definition you will always have poverty. There is no way to eliminate it.
But, if by “poor” we mean insufficient resources to be reasonably well fed, clothed, and sheltered, and to have basic customary amenities, then we can talk about eliminating poverty. We can compare economic systems based on incidence of poverty.
When it comes to the two dominant economic systems of the 20th Century, Winston Churchill quipped:
What he says of socialism could be expanded to most other economies prior to the rise of market economies. Across cultures and time, the historical norm has been bare subsistence living for the masses, with a very small group controlling nearly all the wealth. With market economies we see a wide continuum in the size of wealth holdings with even the vast majority of people living at the low end of the continuum better off than the subsistence level existence of masses in our ancestors’ days. Some will no doubt bring up an isolated case like Scandinavian socialism. It is an interesting comparative debate but I want to ask a more fundamental question. Is elimination of all vestiges of poverty in society a realistic measure of an economic system’s validity? Let’ apply this criteria to the Bible.
There is no systematic economic model laid out in the Bible but the Old Testament Law books are filled with instruction about economic issues. Deuteronomy is one such book. It is a long discourse on the covenant God made with Israel. Toward the end (chapters 27-30), God spells out the curses and blessings that come from not following or following the covenant. One aspect of the blessing is promises like this one:
But as we read through books like Deuteronomy and Leviticus we see specific laws pertaining to treatment of the poor as the Israelites live out this covenant. There are laws requiring farmers to leave uharvested grain at the edge of the fields so the poor can glean some food. There are laws requiring the periodic collection of offerings for the poor. There is the provision for a kinsman redeemer where Israelites could redeem a relative who had been sold into slavery.
Of course the most striking provision is the Jubilee Code in Leviticus 25. If someone fell into need, they could “sell” their land and labor to cover their need. I put “sell” in quotation marks because in the strictest sense it wasn’t a sale.
God had apportioned the land of Israel to the tribes and clans as a permanent inheritance. Every fifty years, all agreements to indentured servitude were to end and all land was to revert back to the original owners. The purchase price of labor was limited to the amount of labor that could be done between the transaction and the next jubilee. The purchase price of land was limited to the number of crops that could be harvested between the transaction and the next jubilee. These were essentially lease agreements, not sales. The labor or property eventually reverted back to the owner. Similar limitations existed for debts.
Now keep in mind that these provisions existed as part of a world where the Israelites were living by God’s covenant and God was blessing them with “abundant prosperity.” Yet in this abundance, it is clearly assumed that some people will fall upon hard times. Whether though events out their control or through having made imprudent decisions, the economic system was assumed to result in poverty for some. The economic system did not result in equal outcomes and poverty occurred. If elimination of all vestiges of poverty in society is a realistic measure of an economic system, then the biblical system that God gave under his covenant fails. Other provisions outside the mode of economic exchange were needed.
All through the Old Testament law we see admonitions toward generosity toward the poor. Benevolence is key. The kinsman redeemer custom allowed for families to rescue less fortunate members. Leaving grain at the edge of the field was a mandated provision for the poor at large. There were mandatory offerings that were brought into a storehouse and then used to aid the poor. So there were some parallels to our present methods for assisting the poor today, including a mandatory collection of resources to assist the poor. But the Bible goes far beyond subsidizing the material needs of the poor. Just look at the jubilee.
The jubilee is frequently characterized as a redistribution of wealth. This is false. The jubilee prevented the permanent alienation of Israelites from the economic means of production (i. e., land and labor.) Real estate within cities was unaffected as was the wealth families had amassed through their own prudent behavior. God’s vision was to have each Israelite family participating with him in co-creative dominion over creation. His vision was to have each Israelite participating in his or her own material provision and in the material provision for others. This was the ultimate vision.
Thus, the covenant instructions providing for those who did not come out well in the economic system were not aimed at achieving a sub-culture of subsidized consumers, as though they were so many cattle to be fed and cared for. It was rather to restore each person to their image-bearer calling. Yet failure to grasp the limitations of economic systems (and thus solve all distribution problems by managing market outcomes) and the tendency to reduce assistance to the poor to a mere exercise in increasing their consumptive powers, is prevalent inside and outside the church. More on that in the next post.