The answer the question in the title is yes, capitalism has its roots in Scripture. We will delve into that question further down in the article. First we must lay some groundwork.
Capitalism works because it stimulates people’s creativity and natural desire to succeed. Socialism or communism does just the opposite. It steal’s people’s drive for success and destroys their creativity. I am not saying that capitalism is perfect; it is not. I am saying, however, that socialism/communism is evil.
Capitalism is not perfect because this is a fallen world and sin is prevalent in this world. Even so, capitalism has provided unmatched prosperity wherever it flourishes.
Capitalism is responsible for the eradication of many diseases because it encourages innovation and advancement in the medical field and has increased our health, our longevity, has lessened pain in our lives, and has markedly decreased infant mortality. Because of Capitalism in the West, those medical breakthroughs have been exported to and benefited the entire world.
Innovation in agriculture has vastly increased the amount of food produced in capitalist cultures. Western countries where capitalism has flourished have been able to feed the entire world because of the freedom agriculturists have to experiment. Development in technology alone has made the farmer’s job easier and much more productive. High-tech powered equipment prepares the soil, furrows and plows the soil, plants the seeds, irrigates the soil, helps to keep unwanted pests like weeds and parasites on livestock at much lower levels that in the past. After the crops are grown, powered equipment quickly harvests many crops.
Improvement in soil conservation has been beneficial in increased use of land and in better management of crops and crop yields. Advancements in genetics has increased disease resistance in crops, and has provided a great variety of hybrids that give us a vast number of choices in the foods we have available. In addition to the sheer variety of fruits, nuts, and vegetables available to us, these hybrids have also increase crop yields.
I have been around for a few years. When my wife and I started dating, we had one telephone in our houses. It was connected to a wire that was permanently wired into the wall telephone outlet. The phone was in one location in the house and to use it you had to go to that location and stay in that location while conversing. There were three television networks to choose from and all their programs came to us via a television antenna usually mounted on the roof of the house. Television networks usually signed off at midnight and started programming again at 6 AM. Other than a few who used CB and Ham radios, that was the extent of household electronic communications.
Still that was more electronic technology that our parents had. They only had broadcast radio and telephones. In generations prior to that there were no electronics and no electricity available to folks. There were no electric fans, air conditioning, refrigeration, no cars, trucks, or buses, no airplanes or airlines, etc. Before trains and steamships, people either walked or used breasts or burden for land transportation, and used sails or oars for sea transportation.
Look at the massive technology we have available to us today: superhighways, fast, efficient, comfortable cars, GPS navigation, the Internet, desktop, laptop, and tablet computers, mobile smart phones, which are also very powerful computers, social networks, cable and satellite TV and extremely high-speed Internet, smart kitchens, smart houses, ability to view what is going on in our homes while we are away through modern very tiny cameras in our homes viewed from great distances on our mobile phones, PCs, tablets, or laptops. I could go on and on. There is so much technology available to us today that one person could not possibly know all of it. One last thing, my small, hand-held, battery operated mobile phone has computing power in it that is a quantum leap over the computing power that the Apollo moon lander used.
So, how did all this constant innovation, invention, and improvement come about? Did governments bring it about? Did governments pay for it? Did governments build it? Did governments market it? The answer to all these questions is no, the free market, which is “an economic system that allows supply and demand to regulate prices, wages, etc, rather than government policy1, not the government, brought it about. When this marvelous trek in technological innovation began, it was not governments that began it or promulgated it. It was people. The only government involvement in it was to get out of the way and allow people to excel on their own. We can trace this current technological trend to the Renaissance. It was then that the old feudal system was waning and people began to experiment in a variety of venues, art, technology, and science being the most well-known. It was due to the freedom people increasingly had after the serfdom of the Dark Ages and Middle ages declined.
The government does not produce. It produces no goods; earns no income; and it stifles creativity. All money the government has, it takes from citizens through taxation. Yes, governments print and mint currency, but currency alone has no intrinsic value. Its only value is in the printing, minting, and materials used to produce it. For example a hundred dollar bill or a hundred pound note is not worth a hundred dollars or pounds. They are only worth the few cents or pence that were used to produce them. The only value in money is what it represents.
Currency represents work. Period. If a person’s work is worth a hundred shekels, then a hundred shekel note represents that hundred shekels of work the person did. It is even deeper than that. The work that person does must produce something that is of worth to others in order for it to have value. If a person makes a piece of furniture and is able to sell it for currency, or trade it for barter, then it has intrinsic value. If it is exchanged for currency, then the currency represents the work the person did.
Governments do not produce tangible products that are worthy of value. Yes, government workers do work and that work is worth value to the government and to the people, such as highways and bridges, but most value comes from the production of tangible products. The works that government workers produce for government are not products that will earn the government any money. The products of government workers do have value but not value that can be traded for work outside of the government. In other words the government worker earns nothing of value on the market, so in order for the worker to get paid for his or her work, the government must get the money from the market where the public is.
How do governments get that money? They get it from the people who earn value in the marketplace. They get it not from producing products of value on the market, but from the value that the public earns. The only way governments get money, it through tariffs, taxes, fees, and fines for disobeying the law. To be fair, governments do get some money from the sales of government surpluses, however, the value of those surpluses was originally paid for with taxpayers’ money.
Capitalism defined: an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.
Capitalism has greatly decreased poverty wherever it is has been instituted. Yet there are still those in poverty in capitalist societies. The reasons are varied. Many are in the beginnings of developing their skills earning money thus are still below poverty level; these folks will progress out poverty. Some are unable to work due to physical impairments. Others have not the skills to earn any income above the poverty level. Some are receiving government benefits that exceed poverty levels, but if they were to get a job, the benefits would end thrusting them into poverty. Finally, there are the lazy—those that simply do not want to work. There may be other reasons not listed here. We have a myriad of charitable and government programs that are aimed at preventing poverty. Poverty is in the world in all societies because of the sinfulness of the world. There will always be people in poverty as Scripture tells us. But note that the Scripture also provides a remedy for the poor. We are to provide for the truly poor and needy in this world:
Deuteronomy 15:11 For the poor shall never cease out of the land: therefore I command thee, saying, Thou shalt open thine hand wide unto thy brother, to thy poor, and to thy needy, in thy land.
Matthew 26:11 [the words of Jesus] “For ye have the poor always with you; but me ye have not always.”
Mark 14:7 [the words of Jesus] “For ye have the poor with you always, and whensoever ye will ye may do them good: but me ye have not always.”
Capitalism allows individuals, who desire to earn a comfortable living, or who wish to reduce tedium, who aspire to help others, or simply want the world to be a better place, the ability and freedom to experiment, innovate, invent, or improve upon technology, medicine, agriculture, transportation, art, etc. Capitalism allows men to dream and use their own abilities to succeed in their endeavors. Capitalism also allows people to fail and to learn from their failures and then try again to do better. Capitalism brings a classless society where people many move upward in to what would have at one time been considered higher classes.
In our Western cultures we have three basic unofficial classes, the lower, the middle, and the upper classes, or basically the poor, the middle income earners and the rich. There is no limit to what class one may want to be a part of. In a capitalist society one can move back and forth into of out of whatever class they wish. They do so by their own efforts.
Socialism had two classes, the egalitarian poor (or the masses), and the super-rich elitist ruling class. These are sometimes known as the proletariat and apparatchiks. It is the apparatchiks that own the villas, drive the better cars, have access to the best medical facilities, have the highest incomes, etc. The proletariat are the egalitarian masses made up of the equally miserable, which is what the socialists consider to be fairness.
In a capitalist system, people are free to be whatever they wish to be and whatever they have the drive to be. Capitalism allows for rich and poor. But it does not force anyone to be either. It allows individuals to make choices that will keep them in poverty, to allow them to become rich, or to allow them to remain in between. It is their choice.
Socialism purportedly does away with the poor because of the Marxist adage “from each according to his ability, to each according to his needs.” Unfortunately that only works for a short time. Let us take, for example, a productive man (or woman) who works hard and has three quarters of his income taken from him though taxation while he watches the non-working person receive from the government the same amount of money the government allows him to keep. That, my friend, is socialism in a nutshell.
How long would that man continue to produce under those circumstances? It would probably not be long before he would join the non-working population. That is the problem with socialism. It provides disincentive for people to be productive and production in the market place is where value originates. Without it, there is no money for government. Margaret Thatcher’s (and others’) words come to mind: “The trouble with Socialism is that eventually you run out of other people’s money.” Here is a direct quote from her on the subject, “It’s the Labour Government that have brought us record peace-time taxation. They’ve got the usual Socialist disease—they’ve run out of other people’s money.2“
This has been proven in multiplicity throughout history. It is being proven even today. All the purely communist or socialist societies in the world today are proof of this. Venezuela is the latest example. What was once an “unfair” prosperous capitalist nation where there was plenty for all, including the poor and needy, has become place where services such as clean water, electricity, garbage disposal, sewer systems, food, housing, clothing, medicine, etc. etc. etc., have become nonexistent or unreliable. Hunger and poverty reign for the masses, while the elite, who live in high style and luxury, purposely keep the masses in poverty. Other examples are Cuba, North Korea, and many Chinese provinces that are outside of the minimally capitalist big cities.
There are those that argue that socialism is the best system. They maintain that the people own the means of production and thus they fare better. Yes the pie-in-the-sky theory of socialism sounds great in principle and on paper, but in reality, the people all become equal; equally miserable, that is. Socialism is against human nature; it is evil. Simply stated, SOCIALISM DOES NOT WORK.
Is capitalism Biblical?
Yes. Though the word capitalism is not it the Scriptures, the concept is seen in both the Old and New Testaments. The concept is gleaned from many passages in the Scriptures. Let us look at a few of them.
Genesis 1:28 And God blessed them, and God said unto them, Be fruitful, and multiply, and replenish the earth, and subdue it: and have dominion over the fish of the sea, and over the fowl of the air, and over every living thing that moveth upon the earth.
To aid our understanding of this verse, let us define dominion. It is the “power to direct, control, use and dispose of at pleasure; right of possession and use without being accountable; as the private dominion of individuals.” (Webster’s 1828 Dictionary of American English). According to Brown-Driver-Briggs’ Hebrew Definitions the definition of the Hebrew word translated dominion is to rule, have dominion, dominate, tread down, or subjugate.
In context this means the humans are to have dominion over the earth. We are to use its resources, to multiply humanity, subdue the wildness of the earth, have authority and rule over the flora and fauna. Having dominion gives us the right to own property. We know from the context of the Bible that humans have the right to own property (e.g. Gen 23:17; 2 Sam 24:25; Jer 32:8-9), and this verse gives humans the right to own property and have control over the property in our possession. Property ownership also applies to our money, our possessions, our intellectual property, our abilities, etc.
The Bible, provides a caveat. It does not allow people to have dominion without accountability; we are accountable to God. That accountability keeps us from the excesses of unaccountability. Such excesses have been seen in innumerable dictatorships throughout history.
Genesis 23:16-18 And Abraham hearkened unto Ephron; and Abraham weighed to Ephron the silver, which he had named in the audience of the sons of Heth, four hundred shekels of silver, current money with the merchant. 17 And the field of Ephron, which was in Machpelah, which was before Mamre, the field, and the cave which was therein, and all the trees that were in the field, that were in all the borders round about, were made sure 18 Unto Abraham for a possession in the presence of the children of Heth, before all that went in at the gate of his city.
This is a prime example of the free market, which is “an economic system that allows supply and demand to regulate prices, wages, etc, rather than government policy3.” Abraham wished to purchase the Field of Macphelah from its owner, Ephron, who had set the price of the field at 400 shekels of silver. Abraham gave the silver to Ephron, with the sons of Heth as witnesses to the deed. As the payment was made, the contract between Abraham and Ephron for the purchase of the land, and the deed of the land were transacted in front of many witnesses at the Hebron city gate.
This was capitalism. The field was the product and the silver was the capital. Notice that no government was involved. Ephron decided what he wanted for the property and offered it to Abraham; Abraham accepted the offer and paid it.
Matthew 20:1-8 “For the kingdom of heaven is like unto a man that is an householder, which went out early in the morning to hire labourers into his vineyard. 2 And when he had agreed with the labourers for a penny a day, he sent them into his vineyard. 3 And he went out about the third hour, and saw others standing idle in the marketplace, 4 And said unto them; Go ye also into the vineyard, and whatsoever is right I will give you. And they went their way. 5 Again he went out about the sixth and ninth hour, and did likewise. 6 And about the eleventh hour he went out, and found others standing idle, and saith unto them, Why stand ye here all the day idle? 7 They say unto him, Because no man hath hired us. He saith unto them, Go ye also into the vineyard; and whatsoever is right, that shall ye receive. 8 So when even was come, the lord of the vineyard saith unto his steward, Call the labourers, and give them their hire, beginning from the last unto the first.”
This was a parable that Jesus used to teach about who would enter the kingdom. In this parable, Jesus used an illustration of a farmer that hired men to work in his vineyard. Jesus does not tell us what kind of work it was; it could have been pruning, weeding, soil preparation and maintenance, harvesting, etc. What we do know it that the farmer hired men for a wage. The wage was negotiated between the owner and the workers and agreed upon. At the end of the day the farmer had his foreman pay the workers their wages.
This is another example of the free market and capitalism. The market was free because the farmer and the laborers negotiated the contract—the farmer for their work and the workers for their pay. There was no government or minimum wage involved. This was an agreement between men for a job to be accomplished and a wage to be earned. The workers agreed to work for one denarius for a day’s work.
The determining factor for the wage was how critical the need of the farmer was for the workers versus the availability of workers. Had there been fewer willing to work for that wage, the farmer may have increased it; had there been more, he may have paid less. From the worker’s point of view, if more skill was needed than the workers could provide, the wage may have been increased to attract more skillful workers. It is a win-win for all involved. It was fair because all agreed to the terms. No one was forced.
I’ve given you a Old Testament example of capitalism and the free market and a New Testament example. There are many other verses and passages that show the approval of capitalism and the free market. In the Law (Exodus-Deuteronomy), there are regulations about how an employer should act and how a worker should act. Those laws are designed to prevent excesses, fraud, dishonesty, cheating, etc. They are prudent laws that do not suppress the flow of capitalism and the free market. So, yes there are some prudent laws that are designed to keep people honest.
Here are examples of such a laws:
Deuteronomy 24:15 At his day thou shalt give him his hire, neither shall the sun go down upon it; for he is poor, and setteth his heart upon it: lest he cry against thee unto the LORD, and it be sin unto thee.
Leviticus 19:36 Just balances, just weights, a just ephah, and a just hin, shall ye have: I am the LORD your God, which brought you out of the land of Egypt.
Capitalism is the best course. Laws are needed and do exist that are designed to protect consumers and purveyors from harm in the normal progress of day to day commerce. Contract laws are examples as are weights and measures standards. Many of the standards we have in industry to protect consumers and purveyors were agreed upon by the industries themselves and were not instituted by government.
Examples are SAE tools and hardware, standard pipe sizes and threads, standard wire sizes, standard concrete blocks, standard tire sizes, light bulb sockets, paper sizes, power designations, cans, ice trays, etc. The list could go on. Every one of these standardizations has made it easier to produce and move products in the free market and are based on capitalism.
Do you know Jesus Christ as your Savior? He is going to return to the world soon. Are you ready? When He does if you do not know Him as your Savior, you will join all those who do not know Him in “Outer Darkness where there will be weeping and gnashing of teeth.” (Mat 22:13-14).
- Merriam-Webster.com. 2011. https://www.merriam-webster.com (8 May 2011).
- From a speech given by Margaret Thatcher at Winter Gardens, Blackpool, UK, Oct 10, 1975, Copyright © Margaret Thatcher Foundation 2018. All Rights Reserved.
- Collins English Dictionary – Complete and Unabridged, 12th Edition 2014 © HarperCollins Publishers 1991, 1994, 1998, 2000, 2003, 2006, 2007, 2009, 2011, 2014