Let there be markets:
The evangelical roots of economics
By Gordon Bigelow
When evangelical Christianity first grew into a powerful movement,
between 1800 and 1850, studies of wealth and trade were called
“political economy.” The two books at the center of this new learning
were Adam Smith’s Wealth of Nations (1776) and David Ricardo’s
Principles of Political Economy and Taxation (1817). This was the period
of the industrial transformation of Britain, a time of rapid urban
growth and rapidly fluctuating markets. These books offered explanations
of how societies become wealthy and how they can stay that way. They
made the accelerated pace of urban life and industrial workshops seem
understandable as part of a program that modern history would follow.
But by the 1820s, a number of Smith’s and Ricardo’s ideas had become
difficult for the growing merchant and investor class to accept. For
Smith, the pursuit of wealth was a grotesque personal error, a
misunderstanding of human happiness. In his first book, The Theory of
Moral Sentiments (1759), Smith argued that the acquisition of money
brings no good in itself; it seems attractive only because of the
mistaken belief that fine possessions draw the admiration of others.
Smith welcomed acquisitiveness only because he concluded—in a
proposition carried through to Wealth of Nations—that this pursuit of
“baubles and trinkets” would ultimately enrich society as a whole. As
the wealthy bought gold pickle forks and paid servants to herd their pet
peacocks, the servants and the goldsmiths would benefit. It was on this
dubious foundation that Smith built his case for freedom of trade.
By the 1820s and ’30s, this foundation had become increasingly troubling
to free-trade advocates, who sought, in their study of political
economy, not just an explanation of rapid change but a moral
justification for their own wealth and for the outlandish sufferings
endured by the new industrial poor. Smith, who scoffed at personal
riches, offered no comfort here. In The Wealth of Nations, the shrewd
man of business was not a hero but a hapless bystander. Ricardo’s work
offered different but similarly troubling problems. Working from a basic
analysis of the profits of land ownership, Ricardo concluded that the
interests of different groups within an economy—owners, investors,
renters, laborers—would always be in conflict with one another.
Ricardo’s credibility with the capitalists was unquestionable: he was
not a philosopher like Adam Smith but a successful stockbroker who had
retired young on his earnings. But his view of capitalism made it seem
that a harmonious society was a thing of the past: class conflict was
part of the modern world, and the gentle old England of squire and
farmer was over.
The group that bridled most against these pessimistic elements of Smith
and Ricardo was the evangelicals. These were middle-class reformers who
wanted to reshape Protestant doctrine. For them it was unthinkable that
capitalism led to class conflict, for that would mean that God had
created a world at war with itself. The evangelicals believed in a
providential God, one who built a logical and orderly universe, and they
saw the new industrial economy as a fulfillment of God’s plan. The free
market, they believed, was a perfectly designed instrument to reward
good Christian behavior and to punish and humiliate the unrepentant.
full: http://www.harpers.org/archive/2005/05/0080538
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