The following is a brief response to Dr. Banescu's discussion on capitalism and its compatibility with Orthodoxy in The Illumined Heart, a wonderful podcast on Ancient Faith Radio.
Impact of the Welfare State on Living Standards
Dr. Banescu claims that social democratic countries are associated with lower living standards. However, there is an abundance of empirical research that reveals the contrary. Below is a sampling of recent findings:
1.) Leftist political institutions reduce relative poverty (David Brady, 2003, “The Politics of Poverty,” Social Forces, Vol. 82).
Dr. Banescu claims that social democratic countries are associated with lower living standards. However, there is an abundance of empirical research that reveals the contrary. Below is a sampling of recent findings:
1.) Leftist political institutions reduce relative poverty (David Brady, 2003, “The Politics of Poverty,” Social Forces, Vol. 82).
2.) Social-Democratic welfare states prevent income poverty (Muffels & Fouarge 2004, “The Role of European Welfare States in Explaining Resources Deprivation,” Social Indicators Research, Vol. 68).
3.) Public entitlement programs reduce both relative and absolute poverty (Scruggs and Allan, 2006, “The Material Consequences of Welfare States,” Comparative Political Studies, Vol. 39).
4.) The welfare state enhances life satisfaction (Pacek & Radliff, 2008, “Assessing the Welfare State,” Perspectives on Politics, Vol. 6)
Capitalism and its Relationship to Theism
The U.S. is unique among advanced industrialized democracies both for its high degree of religiosity and its highly capitalistic economy. Dr. Banescu assumes that these unique qualities must be causally related. In other words, there is something inherent in capitalism that enhances or sustains the level of religiosity in a country. This may or may not be true, but it strikes me as a theoretically-undeveloped thesis (as a social scientist, I could never get away with arguing that two or more variables are causally related unless I could explain that relationship theoretically).
I saw no mention of alternative explanations, such as the following two (I quote these verbatim from U.S.A. Today, which reported on a recent AP-Ipsos poll):
1) “Many countries other than the United States have been through bloody religious conflict that contributes to their suspicion of giving clergy any say in policy.”
Capitalism and its Relationship to Theism
The U.S. is unique among advanced industrialized democracies both for its high degree of religiosity and its highly capitalistic economy. Dr. Banescu assumes that these unique qualities must be causally related. In other words, there is something inherent in capitalism that enhances or sustains the level of religiosity in a country. This may or may not be true, but it strikes me as a theoretically-undeveloped thesis (as a social scientist, I could never get away with arguing that two or more variables are causally related unless I could explain that relationship theoretically).
I saw no mention of alternative explanations, such as the following two (I quote these verbatim from U.S.A. Today, which reported on a recent AP-Ipsos poll):
1) “Many countries other than the United States have been through bloody religious conflict that contributes to their suspicion of giving clergy any say in policy.”
2.) “A long history of religious freedom in the United States created a greater supply of worship options than in other countries, and that proliferation inspired wider observance.”
The posited relationship between capitalism and theism reminds me of the inverse relationship between the latter and I.Q. (of which many atheists are so fond), and I find both to be spurious. On the contrary, I believe a case can be made for a relationship between capitalism, on the one hand, and secularization and immorality, on the other (please take this with a grain of salt, though, since I don’t have time to elaborate on this argument here).
Orthodoxy and Capitalism
If I remember correctly, Dr. Banescu argues that although the Byzantine Empire behaved in ways analogous to the modern welfare state, we mustn’t forget that it was also capitalistic. Yet this is less of an argument than it is a matter of grammatical preference. After all, one wishing to enhance social democracy’s appeal could simply argue in the reverse; that is, although the Byzantine appear was capitalistic, it also behaved in ways analogous to the modern welfare state. Indeed, Nikolas Gvosdev (Emperors and Elections: Reconciling the Orthodox Tradition with Modern Politics, Troitsa Books) notes “parallels between the principles espoused by the Byzantines with the operations of the modern welfare state” (p. 130). Gvosdev goes so far as to argue that there is “a tendency within Orthodox economic thought that lends support to socialism, based on conciliarism” (p. 128).
“Creating Value”: Dispelling the Nature Myth
The posited relationship between capitalism and theism reminds me of the inverse relationship between the latter and I.Q. (of which many atheists are so fond), and I find both to be spurious. On the contrary, I believe a case can be made for a relationship between capitalism, on the one hand, and secularization and immorality, on the other (please take this with a grain of salt, though, since I don’t have time to elaborate on this argument here).
Orthodoxy and Capitalism
If I remember correctly, Dr. Banescu argues that although the Byzantine Empire behaved in ways analogous to the modern welfare state, we mustn’t forget that it was also capitalistic. Yet this is less of an argument than it is a matter of grammatical preference. After all, one wishing to enhance social democracy’s appeal could simply argue in the reverse; that is, although the Byzantine appear was capitalistic, it also behaved in ways analogous to the modern welfare state. Indeed, Nikolas Gvosdev (Emperors and Elections: Reconciling the Orthodox Tradition with Modern Politics, Troitsa Books) notes “parallels between the principles espoused by the Byzantines with the operations of the modern welfare state” (p. 130). Gvosdev goes so far as to argue that there is “a tendency within Orthodox economic thought that lends support to socialism, based on conciliarism” (p. 128).
“Creating Value”: Dispelling the Nature Myth
Imagine yourself instantly transported to a plot of land dotted with apple trees. The fruit of this land is available to all who are willing to work for it. Suppose you expend the effort to pluck two apples from one of the trees. The enjoyment of those apples is the natural consequence of, or reward for, your labor. And if someone were to come along and take an apple or both against your will, he would rightly be accused of stealing. The proponent of laissez-faire capitalism likens this to the state of affairs in a “free” market economy. One’s wealth is imagined to be the direct, natural, result of his personal efforts alone. To the very last penny, one’s wealth is believed to measure the extent of his labor with the same precision that a thermometer gauges the temperature outside. Hence, to take any portion of that wealth (i.e., in the form of taxation) would be tantamount to stealing. This explains why, of the three possible ways “of creating and obtaining value”, Dr. Banescu places taxation in the same class as stealing.
However, wealth accumulation in a capitalist economy is quite different from picking apples. In reality, “wealth is not simply the result of an individual’s efforts, but exists within the context of a larger community which has supported and protected these efforts” (Gvosdev, p. 125). Further, the government (far from being the enemy of laissez-faire mythology) is the instrument through which these efforts are supported and protected. If government policy benefits the wealthy, and if wealth production is a collective effort, why should it not also benefit the working class? The individualism that pervades our culture encourages the myth that the rich C.E.O. arrived at his position on the basis of his personal efforts alone, as if workers are no more deserving of credit than a conveyor belt.
However, wealth accumulation in a capitalist economy is quite different from picking apples. In reality, “wealth is not simply the result of an individual’s efforts, but exists within the context of a larger community which has supported and protected these efforts” (Gvosdev, p. 125). Further, the government (far from being the enemy of laissez-faire mythology) is the instrument through which these efforts are supported and protected. If government policy benefits the wealthy, and if wealth production is a collective effort, why should it not also benefit the working class? The individualism that pervades our culture encourages the myth that the rich C.E.O. arrived at his position on the basis of his personal efforts alone, as if workers are no more deserving of credit than a conveyor belt.
