Thursday, May 31, 2012

Community-based Banking (11) Trust

A Christian community should be full of trust. This is a huge advantage, as money functions best when people trust the other people in their community. When people accept money, they are trusting other people in their community to accept it in exchange for goods or services. They do not have to trust everyone in the community, but they will need to know there are enough trustworthy people in the community to give credibility to the community-based money. They also need to know that the record-keepers in the community can be trusted.

Money represents a debt of the community. The value of money depends on the people of the community honouring its obligation. There is a strong biblical basis for honouring community-based money. Paul said,

Give to everyone what you owe them… Let no debt remain outstanding, except the continuing debt to love one another (Rom 13:7-8).
These are commands to the Christians community to honour its obligations. They are the basis for a money recording system.

The transactions recorded by record-keepers are the obligations of the community. They are not the obligations of the record-keeper, or the bank. The record-keeper just records the debts and obligations of people in the community. If the community breaks down and ceases to honour its obligations, or fobs them off to someone else, the obligations that have been recorded may prove to be worthless.

The leaders of a community will want to protect the reputation of their community. They will ensure that all debts of their community are met. The stronger the community, the greater will be the trust in money records of the community.

Wednesday, May 30, 2012

Community-based Banking (10) Christian Banks

When the time is right, many churches will need to start a recording-keeping services as an alternative to failing banks. A banking system is just a network of information systems that record debts and obligations between people. These debts and obligations change as people buy and sell goods and services. The church is a network of relationships, so it would be well-placed to establish a transaction-recording network. A banking system is a network of networks. A network of churches established by true apostolic leadership could fulfil the same role.

When the Kingdom of God advances, human society will naturally form into in Tens, Hundreds and Thousands. A network of honest banks could develop within these communities. All that is needed is a few record-keepers who are trusted by the other people in their community. A trusted trader within a Hundred could start keeping records on behalf of the people that belong to their community. Alternatively, a Ten might take responsibility for maintaining records on behalf of the Hundred in which they participate.

A Ten would probably not need to keep money records, because its relationships will be governed by love. Most transactions will be gifts with nothing expected in return. This works fine in a small community, but it is not practical for a larger social group.

The trader who kept records for their Hundred could establish links with other Hundreds, as traders with a reputation for honesty replicate this role within their own community. Apostles will help them establish links with other record-keepers. Provided trust exists between the leaders of these communities, trade between Hundreds and Thousands should flow easily.

The various record-keepers will maintain good relationships with the record-keepers in other Thousands. They will be able to transfer debits and credits to other record-keepers, because they are not shifting money, but simply transferring the record of a debts and credits.

This full series is at Community Banks.

Tuesday, May 29, 2012

Community-based Banking (9) Gold

Money requires trust to function effectively. Gold is not real money. It is actually a form of barter. When a person makes a purchase with gold coins, they have exchanged one good for another. Gold is easier to barter than most other goods, because most people will accept it. Gold works well in in a society where trust has broken down, as it does not require any trust. People do not have to hand over the things they are selling until they have seen the coins they will receive exchange. Carrying round gold coins is quite inefficient, but it allows free exchange of goods to take place in a society where trust is gone.

During times of war or social tumult, trust naturally declines. Gold become more important for trade, because no one knows who can be trusted. Someone accepting gold or silver in exchange for goods trusts nothing but the accuracy of the scales and the quality of the metal.

The use of gold coins usually leads to a gold standard where bankers store the gold and their notes circulate as money. People trust the bankers issuing the money, but they do not need to trust the rest of their community, because they can always go and withdraw their gold and use it for trade, if people stop trusting the banker’s notes. The gold standard is not based on trust, so it is a money system for communities with no trust.

When trade and exchange take place between people in different communities and nations, the transactors do know each other, so they will not usually be able to trust each other sufficiently to give credit. Gold and silver were always important for people travelling to different countries, because it enabled them to make payment for purchases from people who did not trust them. Coins were not much use in this situation, because even if their genuineness was authenticated by the mark of a banker or king, they would be trusted outside their own territory. In the traditional world, travellers would use scales to measure the gold or silver they used to make purchases while on their journeys.

Monday, May 28, 2012

Community-based Banking (8) Portable IT


Record-keepers will initially record transactions on a slate or in a notebook. As their business grows, they might transfer their records onto a laptop or iPad. Eventually, a networked system that links up all the record-keepers might be built by one of the Thousands and leased to other record-keepers.

Money is really portable information technology. A coin is a token recording the obligation of the community to the person holding it. A banknote is a paper record of the same obligation. Notes and coins are a record of the obligation of the community to the person holding them. When that person receives goods or services from someone in the community, the obligation is cancelled, so the notes and coins are handed over. They are handed over to the person who supplied the goods of the service, as a record the obligation of the community to provide goods and services to them.

When a purchase is made using EFTPOS, the obligation is recorded using electronic information technology. Efficient electronic information technology is better for recording this type of information than notes and coins, provided it is accessible wherever people want to buy and sell.

Sunday, May 27, 2012

Community-based Banking (7) No Contract

Money is a debt obligation of the entire community, not a particular individual, so there is no formal contract as is the case with a debt owed by one person or business to another. Money records are a commitment by a community. The right to receive goods in return for money is personal, residing with the person who holds it, but the obligation to provide goods in return for the money is not belong to a specific person, but rests with the entire community.

A particular person will supply goods in exchange for money, if they are confident that other people in the community will give do the same for them. At the time when they give up something in return for money, they probably do not know who in the community has the goods or service that they want to buy with it. They rely on the fact that most people in their community are willing to accept money and presume that someone one will be willing to receive money for goods or services, when they are ready to buy something. If individuals stop trusting their community, they will be unwilling to give up for goods and services in return for the money that circulates in the community.

Saturday, May 26, 2012

Community-based Banking (6) Created by the Community


Money is not created by the government. Money is created by the trust of the people in the community in which it is issued and accepted. The value of a currency only extends as far as the authority and reliability of the group that accepts it is trusted.

Trust fosters trade. If trust in is limited to immediate neighbours and friends trade will be almost impossible. If trust extends to larger communities, trade and specialisation will increase. If trust spreads across many communities, trade will expand.

State money only has value within the boundary of the state. Most coins have a picture of the king on them. People assume that the king’s coins have value anywhere that the king has control. This is an illusion. A coin is only of value as far as the king is trusted and most kings are not trusted, because they have frequently debased their coins.

A king cannot make money valuable. A king cannot force a people to trust his money. All he can do is demand that people pay taxes using their coins. This creates some demand for the king’s coins, but it does not establish trust in the king’s money. A king’s money will only be used throughout a nation if the people know that other people within the community will accept in exchange for goods and services. If that trust disappears then the money will stop being used as people find safer ways to trade. A king cannot stop this from happening.

The fiat money that we currently use is backed by the government. Most people assume that it can be trusted because the laws require everyone to accept it for the settlement of debt and for the payment of taxes. Trust in fiat money is really trust in the government. Unfortunately, governments cannot be trusted. Throughout history, they have debased their currencies and their people have suffered terribly.

The truth is that money only has value, if people of the community accept it as having value. It will only be trusted, if the people of the community trust it. They will only trust it, if the key traders in their accept it. If people stop honouring the obligation it represents, its value disappears, regardless of whose picture is on it or the laws behind it. If traders stop accepting money, then its value will disappear, regardless of who has issued the money?

When I have a hundred dollar note in my pocket, I feel confident, but what am I trusting? I am not assuming that the paper has value. I am not trusting the bureaucrat who signature is on it. I am trusting the people in my community. I am relying on some in the community to exchange the note for something that I need.

Friday, May 25, 2012

Community-based Banking (5) Savings

Initially people would try to minimise their risk by quickly making a purchase to eliminate their credit balance. Once they learnt to trust the record-keepers, some might leave some of their credit with the record-keeper until they needed fresh goods later in the week. Over time, they might leave their positive balances longer and longer, as they match the timing of their purchases to their needs. If they trusted the record-keeper and their community, they might build up their credit balance over a couple of years, to save up for a big purchase.

Other members of the community could set up as loan brokers. They would offer those with positive balances a monthly interest rate, if they would lend it to someone with a more immediate need. The loan broker would need to establish the trustworthiness of the person borrowing. They might need to guarantee compensation, if the borrower defaulted.

Record-keepers would not become loan brokers, as they would lose their independence and people would stop trusting them. Trust would be so important to their business that they would need to avoid any activity that would put it at risk. A record keeper who lost trust would have lost their business, before they could recover their trust.

Thursday, May 24, 2012

Community Based Banking (4) Money Records

The task of the record-keeper is to keep a record of who in the community is owed something and who owes something to the community.

In an act of charity, one person gives and another receives. There are no outstanding debts.

In barter, both people give and receive at the same time. The transactions are reciprocal, so there is no outstanding obligation.

In a market transaction, giving and receiving are not reciprocal.

  • After a sales transaction, the seller has given, but has not received.
  • The buyer has received, but has not given.
The record-keepers will record that the buyer has received, but not yet given. The buyer has taken on an obligation to give something to someone in the community. More likely, they will have had a previous obligation from the community wiped out. The seller has given, but has not yet received. The community now has an obligation to give something to them. More likely, he will have had a previous obligation to give someone to the community wiped out.
If someone has a positive record, they have given things to other people in their community without receiving anything equivalent in return. They are not someone wanting something for nothing, so people in the community should be willing to supply them.

The person who has given but not received will be recorded as plus x. The community has an obligation to that person. The person who has received, but not given will be recorded as negative x. They will have the agreed to the price of the purchase that they have deducted from their account. They have an obligation to the community that can only be settled by giving something of similar value to someone else in their community.

The unit that debts are recorded in does not matter, provided everyone understands it and uses it. It can relate to a particular commodity or to a currency that has existed in the past. People can look around and see goods and services priced in the units adopted, so they can see what the unit is worth.

Historians record that pounds, shillings and pence were used as units of account in Western Europe hundreds of years after these coins had stopped circulating. Coins in these denominations did not exist, but people still used these units for recording debts and other market valuations. When I was growing up, guineas were used at stock auctions even though these coins have not existed here for more than a hundred years.

Wednesday, May 23, 2012

Community Based Banking (3) Auditors

The various record-keepers in a community would be competing with each other to have the most trust. If one lost a bit of trust, people would quickly shift their business to another recorder. To maintain trust, record-keepers would need to allow anyone who wanted to examine their records to do it. Most would not have time to do it, so someone with spare time might regularly go round and check the records of everyone undertaking this business in the community. These record-auditors would regularly add up the net balance on each record keepers books and check that they netted to zero. This would quickly expose any fraud. The auditors would support the community by publishing their findings.

At first, record communicated would be very simple an manual. As the economy expanded, the record keepers would develop electronic systems. They would eventually develop distributed and mobile systems that would record transactions anywhere in the community. The result would be a fully functioning money system.

Tuesday, May 22, 2012

Community Based Banking (2) Multiple Recorders

In some communities, several people will operate this transaction recording service. The next step in the development of community banking would be the cancelling out of countervailing debts and credits between different recorders. If a person had a credit with one record-keeper, that person could get them to another pass the credit to another record-keeper to assign to another person that has supplied the first person with for goods or services.

The record-keeper would be happy to pass a positive balance to another recorder, because it does not belong to them, but to the person they recorded it for. They would not mind if the person who was previously positive went negative in the records, because it is not a debt owed to the record-keeper, but to the rest of the community. The debt would only fall to the record-keeper, if the person owing it cheated by keeping on taking, but refusing to give anything to anyone else. This would be a risky course to take, because once the record-keeper alerted the rest of the community to what is going on, that cheat would either be ostracised or intimidated into settling their debt.

A wise record-keeper would stop recording their own debts and credits and get another trusted recorder to do it. That would reduce the temptation to cheat and add extra transparency to their operation.

Once several people have entered the record-keeping business, the negative and positive balances recorded by particular record keepers would no longer balance. One might have negative exceeding positives. Another might have positives exceeding negatives. However, the negatives and balances would balance out across the entire community. For everyone in the community who is owed something, there would be another person in the community who owned the same amount. If all the records were put together, the balances should net to zero.

Monday, May 21, 2012

Community Based Banking (1) Recording Transactions

Most modern people assume that a money system has to be established and regulated by the government. Those who reject this view tend to assume that money must be based on a precious metal like gold. Both these views are wrong.

A money system can emerge in any community where people trust each other. All that is needed is a few people that are trusted by everyone in the community. Christians need to understand this. The money systems of the world are shaking and may eventually collapse. Christian communities should be strong on trust, so they will be well placed to develop to stable money systems to replace the ones that have failed. In this series of posts I will describe how a community-based money and banking process could emerge and grow.

Recording Transactions
A community-based banking service would most likely start when a trustworthy person starts supplying goods and services to other people in exchange for things that they need. The trustworthy person might begin recording their economic transactions. The process would not need to be sophisticated. A slate or exercise book would suffice. If the trustworthy person trusts some of the people being supplied, they might be given them credit by allowing to buy goods without paying for them straight away. The trustworthy person would keep a slate recording the amounts that various people owe. Keeping records in this way would enable the trustworthy person to become an active trader in the community.

Provided they trust the person keeping it, a person clearing their slate might provide more goods and services than they owe. Their record on the slate would be changed from a negative to positive. By recording negative and positive values, the slate would develop into a record of debits and credits. The trustworthy trader would owe things to some people and be owed something by others. These economic transactions would be recorded on the slate or exercise book.

The next step in the development would be for person who has received something from another to settle their debt by asking the trustworthy person to reflect this transaction on the slate by changing their balance to negative and changing the record for the person supplying the goods to a positive value. The trustworthy person would facilitate trade within the community by recording debits and credits and shifting them between people as they exchange goods and services.

The trustworthy trader could extend their business by providing the same recording service for other producers and traders. Many of these would not have sufficient trust in the community to be able to do this for themselves. People could then start bringing their surplus goods to the market and sell them to any other trader in return for a credit with the record-keeping trader. They could then use the credit to purchase goods from the traders who had what they wanted.

Once their service is widely accepted, the record-keeping trader might start recording the purchases and sales for everyone living within the community. Some might leave some of their credit with the record-keeper until they needed fresh goods later in the week. More people would use this record-keeping service when they see that many people trust the record-keeper trader and this way of doing business offer greater flexibility than barter.

If the recording business grows, the trustworthy person might need to charge a small fee for the service, but this specialisation would allow other people to focussing on doing what they did best. They would eventually give up trading and make their living from record-keeping. The trusted person could only specialise in this way, if they were scrupulous about maintaining the trust of the community. If the record-keeper were to start making mistakes, or was to shift credits onto their own account, people would quickly stop trusting them, and their business would die very fast.

Money emerged this way in many traditional communities. Most people would be self-sufficient for food. If they wanted to buy shoes from a local cobbler or clothing from a local garment maker, they would often buy it on credit, because, they might not be able to pay for it until the harvest had come. The cobbler would know his neighbours, so he would only give credit to those he knew to be creditworthy, ie those he trusted. The garment maker might buy some shoes by swapping some debts with the cobbler. Trade emerged with local traders keeping a slate of those who owed payment to them. Banking emerged when responsibility for recording uncompleted exchanges was taken over by a specialist.

The full series is at Community Banks.

G8 Wishful Thinking

President Obama urged the G8 leaders meeting in Chicago to implement policies that will achieve grow and financial stability. This is a noble sentiment, but there is one small problem.

  • Economists struggle to identify policies that would produce grow in the current environment.
  • Economists do not agree on what policies will produce financial stability.
No economist can point to policies that are certain to produce both growth and financial stability.

Friday, May 18, 2012

Christchurch Cathedral Collapsed

The men and women who established Christchurch saw the lights going out across Europe during the revolutions of 1848, so they developed a vision for a city where the Kingdom of God could be preserved. This vision was good but their implementation failed, because their understanding of the kingdom was distorted by a Christendom outlook. God’s plan had an empty cross at the centre with the Holy Spirit flowing through city to bring his life. The square at the centre of the city is not a square, but a cross. The river flows through the centre of the city in the shape of an S representing the Spirit.

The church leaders imposed their vision by building a cathedral on the cross at the centre of the city.
This symbolised the church dominating the institutions around it. This was the Christendom vision that shaped society in the early days of Christchurch.
This situation did not last. As society secularised, the key institutions moved out of the square and out of the shadow of the cathedral.

The cathedral took a serious hit from the earthquake and the tower tumbled to the ground. The church is now demolishing the cathedral and the cross at the centre of the city will soon be empty again. This is what God intended. This opens the way for a different type of kingdom. The old vision where the church controlled the institutions of society has died. The collapse of the cathedral in the centre symbolises that death and opens the way for a different type of Kingdom.

This Kingdom will come in Christchurch through a network of small groups of people listening to the voice of the Spirit, sharing their brothers and sisters, suffering in the face of persecution and serving the people of the city. As the Holy Spirit is given freedom to do his work, the kingdom will flow out and be welcome throughout the city.

Thursday, May 17, 2012

Christchurch - Centreless City

The February 2011 earthquake caused severe damage to the central city. Over the last year, the Earthquake Recovery Authority has worked vigorously to demolish the damaged buildings. Eighty percent of the buildings in the central city have not been demolished. In a few months, all high-rise buildings will be gone.

The city fathers have embarked on an ambitious plan to rebuild the central city. Blinded by big insurance payouts and election promises from the central government, the city council is creating a grandiose plan for a bigger brighter city. My expectation is that just as this project gets under way, the cold winds of economic change will sweep across New Zealand and the money will dry up. The city leaders will discover that all the money that is left will be used up repairing the sewage, water and roading system.

The city council will push on regardless, but will eventually fall into the hole it has created, with liabilities that far exceed the values of its assets. The government in Wellington will not have the resources to come to its aid.

The rebuild of Christchurch will grind to a halt, leaving an empty hole in the centre of the city. A centreless city fits with God’s plan for Christchurch. He will build his kingdom from the outside in. He has been building small groups of kingdom seekers throughout the city. They are an Invisible Spiritual Army that will take back the city for him.

The centre of the city is the place where political power and the powers of evil meet together to leverage their control. With the central city destroyed, their base of power will be gone, opening the way for God to build his kingdom from the edges.

Wednesday, May 16, 2012

Austerity and Growth

Austerity is not a political policy.
It is an economic reality, that cannot be voted away.

Economic growth not a political policy.
It is an actual reality, that cannot be spoken into being by politicians.

Voters and politicians should be clear about the difference.

Monday, May 14, 2012

Ethnic Nationalism

Pat Buchanan wrote these words about the election in France.

Nationalism – be it economic nationalism or ethnic nationalism – is ascendant. Transnationalism and multiculturalism are in headlong if not irreversible retreat. The European project is itself imperiled.
The Red Horse of Revelation represents ethic nationalism.

Wednesday, May 09, 2012

Top Down Society Buiding

Real society is built from the bottom up by people coming together for mutual support. Society emerges as people in local communities connect with each other, support each other and watch out for each other. Attempts to create society from the top down usually fail.

Moses and Joshua knew that society has to be established from the bottom up. Moses put people together in families and tribal groups, so they could take care of each other and support each other.

Moses acted as a temporary supreme court judge to teach people how to apply the new laws that God had given them, but he disestablished the position when he died, because he knew that justice is best established by local judges emerging in local communities.

Joshua acted as a temporary military commander while the children of Israel were going in to the promised land, but he disestablished the position when he died, because he know that communities must be protected at the local level. Groups of communities may need to come together to defend against a larger enemy, but the process must be controlled from the bottom and be temporary.

Jesus knew that his new society had to be built from the bottom up. He turned down the opportunity to bungee jump from the temple without angels instead of bungee cords in order to be appointed as king with top down power in Israel. He instead chose twelve men and established them in a replicatable community that would multiply and grow until the top down authority of the Roman Empire was exposed and redundant.

The American people used to understand this.

When the first settlers moved out from the east coast, they moved with families and friends. They looked out for each other, shared resources and helped each other to build houses. When attacked, they joined together to protect themselves.

The same thing happened when during the later moves into the west. Groups of people travelled together. In times of trouble, they shared their equipment and supported each other and came together for protection.
However, they very quickly forgot.

The constitutional congress was really a coup in which a group of clever men pretended to put in place bottom up institutions, buy actually sowed the seeds which would emerging into a top down society.

Abraham Lincoln really pushed along the idea of establishing society from the top down. The old idea that the central government can only exercise powers that had been given to it died. He finished the job (according to the movies) by sending his taliban generals to destroy what was left of bottom up society and followed them up with carpetbagger politicians to impose top down political power.

Americans can no longer circle the wagons because they have driven their cars into the suburbs and retreated into isolation among people they do not know. During tough times, they do not go to their neighbours for support, but get food stamps from government officials.

At the same time, they get into deep arguments about which of several messianic presidential candidates can establish the best society. They just assume that society must be changed from the top down.

The zeal for guns is a residual from the old order when society came together from the bottom to defend themselves from and external attacker. Now guns are used to shoot neighbours that they don’t know and do not trust.

This explains why most American efforts to export social order fail. Most attempts try to establish society from the top down. The process begins with the people voting in a purple finger election to appoint a president to control society from the top. This top down power allows the president to take half of everything produced in the economy, obstensively to create a better society, but mostly to look after the president’s mates.

The second prong of the American nation building approach is to establish national defence forces (including military, police and security forces). This takes all the best young men out of their own society and productive life and turns them into a burden and a nuisance. Those so do not join the army join the revolution and become a destructive burden on their local community.

This two-prong approach produce economic chaos and military destruction that tears apart the local communities needed to establish strong societies.

Saturday, May 05, 2012

Dying Money

I have recently read When the Money Dies by Adam Fergusson. He tells the story of the Weimar Hyperinflation in Germany that climaxed in 1923.

Just before the First world Wart in 1913, the German mark, the British shilling, the French franc, the Italian lira were all worth about the same, and four or five of any were worth about a dollar. At the end of 1923, it would have been possible to exchange a shilling, a franc or a lira for up to 1,000,000,000,000 marks, although in practice by then no was willing to take marks in return for anything. The mark was dead, one million-millionth of its form self. It had taken almost ten years do die (1).
These were amazing and disturbing events.
  • The main problem was the inflationary policies of the German Reichsbank., Rudolf Havenstein, its long-serving President, did not under that link between loose monetary policy and rising prices. He thought his responsibility was to provide plenty of currency, but he could never catch up.

  • Huge printing presses were run day and night trying to print sufficient banknotes, but they could not keep up.

  • Banknotes declined in value so fast that a basket was needed to carry sufficient money to by some bread. On more than one occasion, a thief stole the basket and left the banknotes behind, because they had lost their value.

  • Workers in the large industrial plants initially survived quite well, because unions were initially able to push through wage increases.

  • Unemployment eventually escalated and workers suffered with the rest of society.

  • People on fixed incomes suffered terribly. Pensions declined in value. Savings and government bonds sold to support the war effort had their value destroyed. The middle classes lost everything that they had.

  • People sold furniture and jewellery to purchase food.

  • People with mortgage debt found that their debts had disappeared.

  • The country folk were better off, because at least they had access to food.

  • Farmers were reluctant to supply food to the cities, because they were unwilling to exchange it for money that quickly became worthless.

  • Groups of desperate people wandered around the countryside looking for food to steal.

  • Food riots were frequent in the cities. They had to be put down using military force.

  • Retailers were frightened to buy good to sell, because by the time they sold them, the money they received would be less than what they had paid. They were reluctant to set prices because they did not know what money would be worth by the time the goods were sold.

  • Many industrialists and financers prospered (this created hostility to Jews).

  • Government departments like the railways and post office could not put up prices quickly enough, so they were constantly losing money.

  • The tax base was eroded by inflation, so the government was always short of money.

Friday, May 04, 2012

Taxing the Rich

Taxes on the rich make poor people (and some Christians) feel better, but they are unjust because the treat righteous and unrighteous wealth the same. The gospels define unrighteous wealth and provide a solution for dealing with it: repent and give it away. Zacchaeus demonstrated how this works.

Zacchaeus stood up and said to the Lord, “Look, Lord! Here and now I give half of my possessions to the poor, and if I have cheated anybody out of anything, I will pay back four times the amount” (Zech 19:8).
When the people saw Zacchaeus doing this, they thought "the Kingdom of God was going to appear at once (Luke 19:11). They were right.

When the church preaches the gospel effectively in a wealthy nation, there should be a large number of Zacchaeuses and a massive flood of unrighteous wealth flowing to biblical deacons who are working with those who care for the poor. If the gospel is also being proclaimed to the poor there should be an even greater number of people being lifted out of their situation into a better life.

Thursday, May 03, 2012

Poverty and Politics

The left and the right positions on poverty are both a cop-out, to avoid dealing with the deeper issue.

The left assumes that a bit more tax on the rich, a couple of laws and a few extra programs can solved the problem. That is totally unrealistic. Dealing with poverty requires personal commitment and a huge amount of sacrifice. Governments programmes just do not have the capability to get the job done, no matter how much they tax the rich.

The right wants the government to keep out, but they forget that the government has got in, because Christian are not doing the job that they are called to do. Create a community where wealth flows down to those at the bottom who are struggling, and the government would not need to be there.

I find it odd that Christians keep looking over the fence for a solution to poverty, when the grass is greener on our side.

The free market is great for producing goods and services effectively through the division of labour and economies of scale. This benefits everyone by making the things that they need cheaper to buy. However, those who produce most effectively are rewarded with growing incomes, while other people are left at the bottom of the heap, so free markets cannot eliminate poverty.

Government programs to deal with poverty have been expanded now for more than sixty years, but the problem is getting worse, because the solution is personal. Government bureaucrats simply do not have the wisdom, love, discernment, compassion and commitment that is required.

The gospel is the best solution to poverty. Mary understood this (Luke 2:53) and the early church seemed to see the results (Acts 4:34). Christians should stop arguing about whether government or market is best for dealing with poverty and get on with the good news.

I have described some of the ways that the gospel works for the poor at caring for the poor.

Tuesday, May 01, 2012

Afghanistan

I do not understand the purpose of the American invasion of Afghanistan. They have trained military forces of more than one hundred thousand and security forces of a similar size. The Afghans were already skilled fighters, so what is the point. Training and equipping Afghans for war is sending an alcoholic to a martini making school.

The Afghanistan economy cannot afford to support military and security forces of this size. Once the foreign aid dries up, these forces will be a deadweight on the economy by taking the best young people out of productive activity and leaving them with nothing to do but cause mischief. Not a recipe for peace and prosperity.

The war has torn apart a family- and tribal-based culture and turned it into a political culture. That is a problem in itself, but worse still, it is a political culture dependent on foreign aid. A political culture can only work if there are coffers full of tax revenue ready to be distributed by political largesse. The Afghan economy is so poor that it cannot support a political culture. The war has destroyed the tribal culture and put nothing its place, except a dependence culture.