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SAUL GONZALEZ: At the recent Worship Facilities Conference and Expo held in Long Beach, California, the business of marketing to places of worship was on full display. At this twice-a-year national convention, companies try to sell their products and services to churches and religious institutions.

UNIDENTIFIED SALES REPRESENTATIVE #1 (speaking to conference attendee): Maybe two cameras to cover the minister and the choir?

GONZALEZ: Their wares range from sophisticated video production gear to pews for churches and synagogues.

UNIDENTIFIED SALES REPRESENTATIVE #2: This is the Cadillac. This is our theater seat, a completely wooden theater seat.

GONZALEZ: Banks and credit unions that specialize in lending and financial consulting to houses of worship also attended.

UNIDENTIFIED BANK SALES REPRESENTATIVE (speaking to conference attendee): We don’t necessarily go by loan to value. We’re looking at cash flow.

GONZALEZ: Although there was plenty of hustle and bustle on the convention floor this year, the recession cast a pall over this expo.

STEVE KROH (Architect): In 25 years, it’s never hit us this hard before.

GONZALEZ: Steve Kroh is an architect whose firm specializes in church design. With congregations cutting back on expansion and new construction plans, Kroh is seeing his business plummet.

Mr. KROH: We’re not having to lay off a lot of people yet, but we’re cutting back on hours and just trying to hang in there right now. We are taking a lot smaller projects than we used to just to keep everybody busy.

ERIC KNOWLES (Founder and CEO, Church Brokers, San Diego, CA): The recession is hitting everybody, and it’s affecting churches just as much as it is the mom and pop homeowner.

GONZALEZ: Eric Knowles is the founder and CEO of Church Brokers, a San Diego firm that specializes in church real estate and financing.

Mr. KNOWLES: Right now, most of the churches we’ve been working with, probably the past year or least, they are all pulling the reins in. They’re not spending anything outside of the hard fast debt they have to pay. Salaries are getting cut back. People are getting let go. A lot of churches are letting their staff go or reducing their pay, going to part time. So it’s a challenging time for churches right now.

GONZALEZ: One house of worship struggling to keep its doors open in the down economy is Long Beach’s Immanuel Church, which is part of the United Church of Christ.

Reverend JANE STORMONT GALLOWAY (Pastor, Immanuel Church, Long Beach, CA): Foreclosure is a possibility and something that we are concerned about.

GONZALEZ: And to those out there who think of churches as being foreclosure-proof?

Rev. GALLOWAY: Oh, no. Forget it.

GONZALEZ: With revenues down, Reverend Jane Galloway’s church is struggling to pay off a more than $850,000 mortgage and loans used to pay for repairs of this more than 80-year-old building.

Rev. GALLOWAY (speaking at meeting): Talking with the mortgage — our mortgage broker. . .

GONZALEZ: To stay afloat the church has cut expenses, and Reverend Galloway has volunteered to slash most of her own pay. But despite the belt tightening, every bill that arrives brings a new challenge.

Rev. GALLOWAY: I mean we’re literally at a point where my husband walked in the other day and said this was on the side door, and it was a turn-off notice for the utilities. Now we are at a scary moment, and we know that each month, if we are unable to make our mortgage payment on time, we could be — the default process can be filed and a foreclosure proceeding could begin.

GONZALEZ: Although no single, hard number exists, banks and credit unions that lend to houses of worship report a steady increase in church bankruptcies and foreclosures. One of them is this 1,000-seat church north of San Diego. Built just in 2005, it closed last year after the church defaulted on loans. Even wealthy and powerful megachurches, such as southern California’s Crystal Cathedral, have had to cut staff and put millions of dollars worth of property up for sale to help pay off debts. Whether they’re big or small, many churches’ money troubles stem from s steady decline in giving. According to the Christian research company the Barna Group, American churches got between $3 and $5 billion less in donations than they expected to receive during the last quarter of 2008. That’s about a four to six percent decline.

Reverend PHIL HERRINGTON (Pastor, Pathways Community Church, Santee, CA, addressing congregation: I thank you to so many of you who have given faithfully using this envelope. It really helps us pay the bills and do what we do as a ministry — in helping people and loving God and loving people.

GONZALEZ: Phil Herrington is pastor of Pathways Community Church in Santee, California.

Rev. HARRINGTON: We have a number of people in our church right now that are unemployed, that have lost jobs. People who used to be significant donors in the church have just flat out lost their income. Maybe they can give in a smaller way, but that affects our overall income.

GONZALEZ: In response, Pathways has had to cut staff and fill more positions with volunteers. Houses of worship that face foreclosure and other financial troubles often get into their predicaments for the same reasons that homeowners and consumers do: borrowing and spending too much money when times are good and not being prepared when the economy goes from boom to bust.

Mr. KNOWLES: You know, churches are no different than, literally, business owners or homeowners. We all believed that everything was going continue to appreciate, that there was no turning of the curve, and so everybody was overleveraging, and churches are no different. They were not exempt.

GONZALEZ: Real estate broker Eric Knowles, a devout evangelical Christian, says churches’ financial problems are sometimes made worse by leaders who are unable to face harsh economic realities.

Mr. KNOWLES: There’s that faith, you know, that often we think that the Lord is directing us to go do something. Well, how do you refute that when I deal with a pastor that says that the Lord is calling me to buy this building? And I have many situations where it will not pencil. We run our analysis and we get real involved and detailed. But then the pastors continue to say, well, I believe God is directing me for this. Goodness. So what do you do? What do you do? We give the best counsel we can. We give it to them pragmatically, you know, documented in writing that this is where you are going to be, and often time the pastor will look me in the face and say, well, you know what? I understand what you are saying. I understand by earthly standards this will not work, but God has called me to do it. And that’s the trump card. What do you do? You’re just kind of like, okay.

GONZALEZ: In both good economic times and bad, some churches are supplementing what goes into collection baskets by finding new and creative ways to raise income. For instance, with assistance from investors Pathways Community Church purchased this once dilapidated shopping mall. The church occupies the space that was once a supermarket but rents out the rest of the center to other businesses. The revenue earned helps the church pay operating expenses and mortgage payments that total over $21,000 a month.

Rev. HARRINGTON: Right now it’s helping us survive. If we didn’t have that right now we would have to massively downsize staff and personnel and do a lot less ministry out in the community than we are doing right now. So it has opened up a lot of doors for us.

Rev. GALLOWAY (speaking at meeting): I think it could be shared space, perhaps like a collective office space . . .

GONZALEZ: But as they try to guide their churches through turbulent economic times, the strain is taking a visible toll on some religious leaders such as Reverend Galloway.

Rev. GALLOWAY: I really want this to work, and I feel a sense of responsibility. I’ll let myself be this vulnerable because you are asking me this. I feel a sense of responsibility to the people I am here for. People come here with broken hearts. People come here looking for food — looking for spiritual food, and I hear the kind of despair they are in, and I realize that it’s crazy for me to be this preoccupied with the finances of some place, when I’m here to create a place where people can come and find solace. So I feel a sense of responsibility to the people who come here for that kind of nurturance.

UNIDENTIFIED SALES REPRESENTATIVE #3: We’ve developed what we call our McDonald’s approach to church design. It’s our “church in a box.”

GONZALEZ: At the expo, those attending hoped the recession would soon end, allowing houses of worship to focus not on their money problems, but on their ministries.

For RELIGION & ETHICS NEWSWEEKLY, I’m Saul Gonzalez in Long Beach, California.

BOB FAW, correspondent: For 900 years this has been the hallmark, indeed, the passion, of Cistercian monks—prayer seven times every day. Nearly five hours each day are devoted, says the superior of this abbey, to the solitary pursuit of friendship with God.

THE REV. BERNARD MCCOY (Superior, Cistercian Abbey): It’s really about a relationship with God, and prayer is just the word we give to the conversation and the relationship that we have with the divine person.

FAW: On nearly 600 remote acres in south central Wisconsin, even private time, as when Brother Stephen Treat walks the Stations of the Cross, even that time is spent, he says, lifting his mind exclusively to God.

BROTHER STEPHEN TREAT (Cistercian Abbey): The main part of our business is going into that church seven times a day and praising God and praying for the safety and well-being of the world.

FAW: Even when Father Bernard relaxes with his Spanish hotbloods Alejandro and Tinaco, or with the ordinary Bert, there is meditation.

FATHER BERNARD: Theirs is about being and about awareness, and there is a quietness to them, obviously, for the most part, so they are a very contemplative presence in our life.

FAW: The rituals, the routines here are familiar, but what sets this abbey apart is that while it keeps one foot in the 11th century, the other is firmly planted in the 21st. On the grounds nearby, with a background of Gregorian chants, is a high-powered Internet operation run by two laywomen which permits the abbey to flourish.

CINDY GRIFFITH (Co-Founder, Monk Helper Marketing and Co-Author, “Laser Monks”): We allow them to be what they were put on the planet to be—to be monks, to do good, to pray for the world.

FAW: All this began seven years ago when Father Bernard went to buy toner for his printer.

FATHER BERNARD: I said, you know, wow, this is just way too expensive for a bunch of black dust or a few squirts of ink. There has got to be a better way.

FAW: So in 2002 Father Bernard started LaserMonks, selling ink and toner to charitable groups at prices far less than office supply stores. In Colorado, online marketing experts Cindy Griffith and Sarah Caniglia noticed and gave Father Bernard a call.

SARAH CANIGLIA (Co-Founder, Monk Helper Marketing and Co-Author, “Laser Monks”): He said come on out to Wisconsin. He said there is beer, you know, there is beer, there are brats, come on out—we’re on 600 acres—and see what you think.

FAW: Sarah and Cindy didn’t just visit; they stayed.

SARAH CANIGLIA: I saw an opportunity to take the monks where they needed to be and to relieve—to take a business idea, the germ of an idea which he had, and turn that vision into a success.

FATHER BERNARD: It’s a wonderful symbiosis that lets us use our talents, lets them use their talents, and helps us do a lot of good work.

FAW: I would regard that as serendipitous. I gather you regard it almost as providential?

FATHER BERNARD: Both. I would call it sacred serendipity.

FAW: Now they also sell deluxe coffee, Benevolent Blends, with profits supporting families who pick the coffee beans—also chocolates, creamy caramels, jams, and jellies made in other monasteries. Sales last year were nearly five million dollars. Eighty percent of that was for expenses, but ten percent went to fund the abbey, and the remaining ten percent went to charity, from a camp for kids with HIV to Buddhists in Tibet.

FATHER BERNARD: So we’re a for-profit whose bottom line is to not make any profit at the end of the year, because it’s all given away in some form or fashion. That’s social entrepreneurism, really, at its radical best.

FAW: Their product line also includes Benevolent Biscuits, treats for dogs prepared in the abbey kitchen, rolled, stamped, and baked by the Cistercians themselves and sampled by the abbey’s quality control officer, Ludwig, the abbey’s Doberman Pinscher.

Here no talent is kept under a basket. What Father Robert Keffer paints will someday be sold to help maintain the abbey.

THE REV. ROBERT KEFFER (Subprior, Cistercian Abbey): You work during the work hours. You stop, you go to prayer. It’s a very—regimented is the wrong word, but it is a very disciplined life. So that’s a little hard for an artist: Oh, I’ve got this great inspiration. I can’t stop and pray now.

FAW: But you have to.

FATHER ROBERT: Yes, you have to, and you most certainly can.

FAW: So here there is a balance between the rigors of monasticism and the demands of the marketplace in an abbey which is both in the world and apart.

FATHER BERNARD: We have cell phones. We have Wi-Fi. We have, you know, things like the normal world. But we know when to turn them off.

FAW: Even though that takes some getting used to, says Brother Stephen Treat, who left what he says was a satisfying job for a Quaker social service agency because he felt the need to do something more.

BROTHER STEPHEN: You do miss certain things, but you would be surprised with what you replace it with, that here I am in a community of six guys, that if all works out I will spend the rest of my life with them and whoever comes after, and I will be buried on that hill, and that falls into an 80-year history of this house and a 900-year history of this order.

FAW: And for those who contend this way of life, this withdrawal from the world, is ultimately selfish, Cistercians have an answer for that.

BROTHER STEPHEN: The Christian tradition understands places like this, contemplative monasteries, as these lighthouses, these beacons where people are joined together in prayer and praying on behalf of the whole world.

FAW: Theirs is a calling which appeals only to a few, but a calling which transforms those who embrace its rigors, just as being part of this community has changed a lapsed Catholic and a divorced grandmother.

CINDY GRIFFITH: Personally, I think I’m more grounded, more settled, more peaceful. The abbey has brought that kind of religious part of me that I didn’t have before I came here.

SARAH CANIGLIA: For me it’s been as much of a spiritual journey as it has all other types of journeys. It’s really brought me back into the fold in a really slow, step-by-step, peaceful way.

FAW: So here, in this oasis of serenity, seven times every day the Psalms, the chants will continue to echo.

FATHER BERNARD: In some ways we perch a little bit more lightly on this planet, and, you know, we have one foot firmly planted in the earth and another one off in the heavens.

FAW: Here, where they live both simply and smartly, having learned, as one put it, “only those who can see the invisible can accomplish the impossible.”

For Religion & Ethics NewsWeekly this is Bob Faw in Sparta, Wisconsin.

LUCKY SEVERSON:  Not too long ago, it would have been almost impossible for General and Candice Sutton to buy a home without violating their faith. They are both devout Muslims who want to finance their new home by following Islamic law, known as Shari’ah, which forbids paying interest.

CANDICE SUTTON:  For us, religion and our faith is — we’d like to incorporate it to every means of our life.

GENERAL SUTTON:  Islam is not just a religion — it’s a way of life.  So when you look at a way of life, you have, you know, different ethical things that you should do, should not do not do.  We are not supposed to be paying interest because that’s not in our way of life.

SEVERSON:  Ibrahim Warde is a professor at Tufts Fletcher School of Law and Diplomacy.  He teaches a class that’s increasingly popular on Islamic banking and finance and says it was the Prophet Muhammad, himself a merchant, who condemned the practice of charging or paying interest, called “riba” in Arabic.

Professor Ibrahim Warde

Professor IBRAHIM WARDE (International Business, Tufts Fletcher School of Law and Diplomacy): There used to be a very common practice of “riba,” which was periodic doubling of the interest.  So, in other words, if you owed money and were unable to pay it, then it would have to be doubled and the whole process would end with enslaving the debtor.  So with the advent of Islam, there was an end to that practice.

SEVERSON:  Candice, who is a transportation engineer, and General, a software developer, are looking for a home closer to work and closer to their mosque.  Their real estate agent is Roma Elhabashy, a Muslim himself, who felt guilty about buying his own home through conventional financing.

ROMA ELHABASHY:  I waited for a long time then I made a mistake and bought a house with regular financing and I couldn’t live with it so I actually had to sell the house for that reason.  Taking advantage of someone who needs money by charging them more money doesn’t make sense.

SEVERSON:  He says it’s not just Muslims who are inquiring about Shari’ah financing.  It’s non-Muslims as well who share General Sutton’s point of view.

Mr. SUTTON:  A lot of the finance companies who are not taking interest, you know, they don’t seem to be as hurt as much as these other companies.  And, you know it’s all driven by money. So it’s all about greed.  You charge interest, you want more money and that just leads to more things that leads to a bad path.

UNIDENTIFIED LOAN OFFICER (Guidance Residential, talking on phone):  How much of a loan are you looking for?

SEVERSON:  This is Guidance Residential, in Reston, Virginia, one of a growing number of companies catering to Muslim home buyers, by devising ways to finance mortgages without levying interest charges.  Candice and General plan to finance their home through Guidance.

Hussam Qutub

Here’s how it works: Candice and General would make a qualifying down payment and Guidance and the Suttons would then purchase the home as co-owners.  But instead of charging interest, Guidance would assess a monthly tax-deductible fee.  Hussam Qutub, is the Director of Communications for Guidance, which has financed more than 5,000 home purchases since 2002.

HUSSAM QUTUB (Director of Communications, Guidance Residential):  Now, in that monthly payment portion, there are two elements.  One is the acquisition element — acquisition portion of the payment.  And the second is the charge.

SEVERSON:  The fee?

Mr. QUTUB:  The fee.  With every payment the customer is increasing his or her shares in the property and ours are decreasing.  And at the same time, their fee is decreasing because we owning less.

SEVERSON:  Professor Warde says skeptics who argue that the finance fee is really not much different than interest are missing the point.

Prof. WARDE:  The example I typically give is religiously inspired dietary rules, in that if some people don’t want to eat food that is not halal or kosher, then a nutritionist can come to them and say, “Why are you doing that?”  But for these people, for religiously minded people, how the food is prepared is quite significant.

SEVERSON:  There are other significant differences.  For instance, the late fee at Guidance is never more than $50.  Shari’ah mortgage holders are also less likely to default on their payments.

Prof. WARDE:  If there’s nothing else you could do in terms of paying a debt and you’ve tried to repay it, then the logic of the Shari’ah is that the loses should be shared by both the borrower and the lender.  But it is definitely a sin to be able to repay and yet not to repay it.

SEVERSON:  But it would also be a sin for Guidance to foreclose on someone without trying to work things out.

Mr. QUTUB:  If for some reason the property value, just as we are seeing today, decrease and we are stuck with proceeds that are not even close to what we are owed on our share, we won’t pursue our partner.  We won’t pursue their savings accounts.  We won’t go after their personal assets.

Prof. WARDE:  One interesting statistic about Muslims in the U.S. is that although they tend to be wealthier than the average American, the rate of home ownership is lower, so most sociologists explain that in terms of some misgivings that Muslims might have about interest-based mortgages.

Zulikha Hussain

ZULIKHA HUSSAIN:  I know a lot of friends who were just renting homes and they were not comfortable because of the simple fact that they strongly had this feeling that it’s definitely a sin to do when you are taking interest or even giving back interest.

SEVERSON:  When Zulikha Hussain and her husband and four kids were relocated to Northern Virginia, she was aware of Shari’ah financing but her husband’s company required that the family use conventional mortgage financing.  Zulikha decided to refinance the house the Shari’ah way so she could perform the fifth pillar of Islam, the pilgrimage to Mecca, with a clear conscience.

Ms. HUSSAIN:  It’s recommended that you are free of debt before make that pilgrimage. That’s why a majority of the Muslims prefer not to get into that particular situation.

SEVERSON:  Shari’ah compliant financing is now moving beyond home mortgages to investments in things like mutual and equity fund.  For the past 10 years, there’s been a Dow Jones Islamic Market Index where investment opportunities are monitored to see that they comply with Shari’ah law.  Islamic market investors, it turns out, have not been hit as hard as conventional investors in the current economic meltdown.

Prof. WARDE:  Shariah compliant mutual funds do not invest in financial institutions.  And given the collapse in the value of financial institutions in the last couple of years, Islamic mutual funds have done quite well, which is also one reason why many non-Muslims have been attracted to Islamic mutual funds.

SEVERSON:  The Dow Jones Islamic index also excludes investments in things like gambling, alcohol, cigarettes, pornography and pork, as well as companies that are highly leveraged or that have shown ethical lapses.

Mr. QUTUB:  Certainly there was an incredible amount of speculation, incredible amount of unknowns and risks were taken.  And that is something that we know in Islam is really heavily prohibited, where you are in essence almost gambling, and gambling is something that is not permissible in Islam.  But for Muslims like Zulikha, Shari’ah compliant financing is about more than money.

Ms. HUSSAIN:  I feel like God’s showing me, “Hey, I’m giving you this opportunity to refinance.  I’m giving you this opportunity to see that this is out there for you.”  So when I do go and perform the pilgrimage, I’ll feel very good about myself that I have completed all the tasks that I needed to do.

SEVERSON:  Shariah financing and investments are still only a tiny portion of the financial market, but growing.

For RELIGION & ETHICS NEWSWEEKLY, I’m Lucky Severson in Ashburn, Virginia.

President BARACK OBAMA: “…a situation where greed, excessive compensation, excessive risk taking have all made us vulnerable and left us holding the bag.”

ABERNETHY: We want to pursue the moral issues of the meltdown with David Miller who teaches business ethics and directs the Faith and Work Initiative at Princeton University, after a career in corporate finance. His most recent book is “God at Work.”

David, welcome. Let’s begin with the enormous gap in pay between the richest few and the average employee. Is that difference in your judgment fundamentally unfair?

Dr. DAVID MILLER (Director, Princeton University Faith & Work Initiative): It’s a great question. In fact, the final exam topic I’ve given my students in the business ethics class is this: “Is executive compensation just or just obscene?” In some cases multiples of 350 times the lowest paid employee is outrageous and not just, not moral. But there are cases when people have added value to society, to their organization; created jobs; dealt in highly risky industries in prudent and responsible ways, and we should reward those people handily. But, indeed, there are some egregious examples, particularly those who get paid for it in non-performance.

ABERNETHY: And the consequences of that for young people, bright young people coming into the workforce? You’ve talked about that.

Dr. MILLER: Yeah, I think there’s a bit of a shift. People going to college and they’re bright and excited. They want to go out and change the world and make a contribution, and then they get lured to Wall Street. Indeed, I’ve been there myself, so I understand the attraction — the competition, the high salaries. But maybe this is a chance for people to rethink — that they ought to become teachers or dentists or scientists or technologists and use their great intellect and skills in ways to create value for society other than through financial engineering. I don’t want to minimize financial engineering, but there are other great ways that some of our minds have not been looking at over the past decade or two.

ABERNETHY: And President Obama has been talking this week, this past week about precisely that — some kind of change in the corporate culture, the business culture. What would that look like?

Dr. MILLER: Well, it’s such an important issue — how can we have a culture, a corporate culture that accents character, that accents the common good and not just earnings per share or a penny more per share per quarter? That’s a new culture. Is it possible that companies can make a decent profit — create wealth, create jobs, provide goods and services for society and maybe even be a moral community to develop its people? I think it can, but it will take leadership that’s committed to a new vision.

ABERNETHY: And when a corporation has enormous power, such power that if it messes up it can hurt the entire country and perhaps the entire world? Should that corporation have a special degree of regulation?

Dr. MILLER: I’m reluctant to pick out or single a particular corporation, but certainly, and we’ve done it historically, certain industries—the energy industry, the communication industry—some are so big and so important that we do regulate them. I don’t know yet if the problem with our current financial meltdown is that we need new regulation or that the existing regulators didn’t do their job — the SEC, the ratings agencies, the actuarial firms. A lot of people could of caught this and didn’t. Certainly people need to do their existing jobs better as far as oversight is concerned. Whether we need new regulation — the jury’s out on that.

ABERNETHY: You, as I said, you used to work in the financial business. What do your friends there, the friends that you have who’ve worked there — what do they tell you about what went wrong; how they feel about it; what they might have done wrong?

Dr. MILLER: Yeah, I work with a group up in Greenwich, Connecticut—we were known as the hedge-fund capital of the world—a group called Greenwich Leadership for people trying to connect their faith and their work and their morals and their values. Some people feel a bit beleaguered by the current situation, because they love their job and they’re good at it, and they are trying to do it in a moral, ethical way and create liquidity and creative instruments for companies. Others, however, realize they’ve bought into something. They’ve almost become addicted to the power and the money. One friend who recently was laid off by AIG, is part of their troubles, privately said he felt that he had made his company his false idol, if you will—that work had become, in his company that he is very proud of actually, had become a false idol, and he was now trying to reorient his life to have balance where faith, family, and other priorities, including his work, would have the right balance, the right perspective

ABERNETHY: David Miller of Princeton University, many thanks.

Dr. MILLER: Thank you, Bob.

Wendell Berry

The first thing that becomes apparent in times like this is how imaginary the economy is. Not imaginary in the sense of fake, necessarily, but in the sense of the way economic realities depend on how reality is imagined. So much of the panic selling of stocks, for example, is based on perception of reality, which then becomes the reality. When billions of dollars of wealth can vanish overnight, it becomes apparent how imaginary wealth is.

All of this is another way of saying that economics and theology have a lot in common. Both deal with how larger reality is conceived. Capitalist economics sometimes tries to deny this by separating questions of “fact” from questions of “value.” We are told, for example, that a market is “free” as long as transactions are informed and voluntary. It does not matter what people value; the economist claims neutrality on that question. All that really matters is if a transaction is free in the above sense. Regulation is usually considered an interference with freedom.

But of course this negative definition of freedom as freedom from interference is a deeply value-laden, theological notion. It assumes a view of the human person as essentially an individual, and it views the human will as sovereign and uncorrupted. Both of these ideas conflict with Christian theological notions of the human as essentially interrelated and in need of the healing of the will by God’s grace. For the Christian, true freedom is not just a lack of interference but is defined positively as an ability to flourish by being connected to God and to our fellow humans who are made in God’s image.

So the questions being raised now about regulation and deregulation and “interference” with the freedom of the market are theological questions, and the theological answer, I think, is that there is no such thing as a value-neutral “free” market. The question is always: “What kinds of economic arrangements lead to true human flourishing and freedom?”
Wendell Berry

We usually turn to the state to regulate the market when crises hit, but I don’t think the modern bureaucratic state is capable of giving real answers about true human flourishing. The best the state can do, as we’ve seen, is try to protect large financial interests. The state has been systematically undermining the interests of workers for a long time now, while politicians, especially on the right, distract the working class by emotional appeals to anti-immigrant sentiment and issues like gun ownership and reverence for the flag.

We have to begin, therefore, to create economic spaces that are not based on profitability and freedom from interference for those in power. There is just no way to avoid the deep theological questions about what makes humans really flourish. The churches should be cooperating with others to imagine and create economic spaces where true human flourishing can take place. The fair trade movement and providing markets for local farmers are a couple of examples. These create personal contact among people, where economic transactions take place within a community of people who are not simply trying to maximize self-interest, but are concerned for the flourishing of all parties involved. One of the lessons of the global economic meltdown, it seems to me, is that a stable economy is always essentially local, as the American writer and farmer Wendell Berry has been saying for years.

The Eucharist provides a resource for Christian imagination and practice here, because it connects people throughout the world but is always essentially local, a people sharing heavenly food around a table. The Eucharist is a kind of consumption whereby we are consumed by a larger body, the Body of Christ, in which, as Paul says, when one suffers, all suffer together, and when one rejoices, all rejoice together.

–William T. Cavanaugh is associate professor of theology at the University of St. Thomas in Saint Paul, Minnesota, and the author, most recently, of BEING CONSUMED: ECONOMICS AND CHRISTIAN DESIRE.

The recent economic debacle should cause us to reread, or perhaps read for the first time, the Christian theological tradition and how it inextricably relates economic exchange to morality (our quest for the good) and to God.

Alfred Marshall

British economist Alfred Marshall, well known for his Marshallian scissors of supply and demand, once said that the modern science of economics “puts man in the saddle.” In other words, all that now defines economic exchange is what humans decide. “Man” takes the place of God in driving history. Perhaps the wild speculation in the stock market that has come to a ruinous end for many (recall that some economists were predicting the Dow would reach 36000 by 2005 — do they still have their jobs? — and the impending fluctuations, where some would try to outguess the market and receive windfall profits, only accentuating the fluctuations) might cause us to reconsider Marshall’s wisdom.

What would it mean to think of economics in terms of God and the good? It would mean in part, I think, that we would take more seriously the problem of usury, which is often mischaracterized. Usury occurs when anyone thinks he or she can have an unlimited growth of money without it being related to validly productive enterprises. It is a sin against God’s created order. The vice of usury is greed, wanting a maximization of profit without relating it to any fruitful created product. Profit is permissible, but within a context of production that is good and can be rightly ordered to God. Once we have a system where an enterprise such as a corporation can be productive, that is to say, its workers produce quality products that serve the common good and better the lives of their neighbors and even turn a modest profit, and yet the first obligation of the CEO of that corporation is not to those workers or those neighbors but to the maximization of shareholders’ profit, then we have an improper disjunction between work, productivity, and money.

Diligence, loyalty, and work are no longer rewarded. What gets rewarded is speculation. We lose any relationship between what is produced and how it is rewarded.

We have seen this in the stock market, where there is little to no correlation between a corporation’s stock price and its earnings. I am no economist, but this seems to me inevitably to produce something of a Ponzi scheme that eventually comes back to haunt us. The individuals who benefit from this are not those who do the work, but those who speculate. They do not purchase goods. They purchase “time” — a speculative possibility of what might be in the future — and try to “sell” it to others, knowing that not all can benefit. The bubble will eventually burst.

As long as business, finance, and the “art” of management fundamentally serve only this one principle of economy, maximization of profit, we may very well continue to have such wild fluctuations every one or two generations, as we now seem to be experiencing. The result will be, as it currently is, that we will socialize the losses while we continue to capitalize the gains. Everyone becomes responsible to pay out when the Ponzi scheme fails. Only those who got in and out early reap the profits. The winners benefit at the expense of their neighbors’ good.

I don’t claim to know how to fix this, but I do think we have to rethink the role of the corporation, its managers, and its commitment to locality: to workers, neighborhoods, schools. Perhaps churches, synagogues and mosques could at least begin there, reminding people of God’s intentions for a profit related to the goodness of creation’s fruitfulness. They all share a fundamental assumption that unlimited growth for its own sake is usurious and that God gives us the opportunity for economic exchange in order to “sanctify” or “make holy” God’s name throughout creation.

What we have seen among CEOs as well as individual households is certainly unholy. It should at least be named for what it is. Greed, we have discovered, is not good.

–Steve Long is professor of systematic theology at Marquette University and the author of many books, including DIVINE ECONOMY: THEOLOGY AND THE MARKET.

The Seven Virtues

Ethics in the economy depends on character, not calculation. It depends on being a good person, not on “stakeholders” or other utilitarian considerations. The word “ethics” comes from the Greek word for “character,” and such an approach through what humans could aspire to be dominated Western — and for that matter Eastern — thinking for millennia. The old and honored approach is called “virtue ethics”: Be thou just, loving, prudent, courageous, temperate, hopeful, and faithful, said the ancients, and you will not make loans to people who cannot possibly pay or request bridges to nowhere from people who can. We are called by God to be virtuous — that’s the religious way to put it. But you can, instead, name the seven virtues the Seven Secular Commandments and note that an economy cannot get along without a modicum of all seven.

–Deirdre N. McCloskey is UIC Distinguished Professor of Economics, History, English, and Communication at the University of Illinois at Chicago and the author of THE BOURGEOIS VIRTUES: ETHICS FOR AN AGE OF COMMERCE.

Reverend Jim Wallis is an evangelical minister, a writer and the editor of Sojourners magazine. Father Jim Martin is a corporate executive turned Catholic priest. He’s an editor of the Jesuit magazine America. He joins us from New York.

Father Martin, welcome. What are the religious principles that all of us should bear in mind as we try to evaluate the different proposals for getting out of this crisis?

Father JIM MARTIN (Editor, America Magazine): Well, I’d like to go from the general to the specific. You can start with the Jewish and Christian principles of caring for the poor, which is very important in both the Old and the New Testaments. Jesus speaks about that very forcefully. More specifically, the Catholic tradition in their social teaching documents talk about solidarity with one another and the common good. It’s not just every man in it for himself, or every woman. You know, we Jesuits talk about not making decisions in a time when you’re freaking out. So there’s a sort of discernment that’s needed. And then, finally, I think that the role of conscience needs to play in this. There’s a reason why people feel uncomfortable with so many people making money and with the bailout possibly helping only the wealthy, and I think the reason people feel that sort of uncomfortable feeling is conscience. I mean, it’s telling us that something’s wrong when only the wealthy benefits, so I think those are some of the principles.

ABERNETHY: But, Jim Wallis, whatever we do has to be something that, first of all, is practical, perhaps. Does it work? Does it work for the whole economy, and does it also work for the very poor?

Reverend JIM WALLIS (Editor-in-Chief and CEO, Sojourners Magazine): Well, I’m an evangelical convert to Catholic social teachings, so I’m going to agree with Jim about all this. You know, this crisis is structural and spiritual both, and this has come about because private gain, greed, has prevailed over the common good. We’ve lost sight of what the common good is, and it’s true, there’s a conversation going on about rewarding the people who are indeed most responsible for the crisis.

ABERNETHY: And lots of people are very angry about that.

Jim Wallis

Rev. WALLIS: And they should be. I think God’s angry at that. Someone suggested the other day, I thought it was a good idea, the CEOs should be paraded down Wall Street in sack cloth and ashes. I think that’s true. So rewarding them while you leave people in my hometown of Detroit — my brother has a $130,000 mortgage; his house is worth $60,000 now, so this is wrong. So the principle is common good and justice. But also I would say this is a moment, a teachable moment to talk about habits, practices, assumptions about greed that we’ve lost conversation about for a long time.

ABERNETHY: Father Martin, there’s also a question about power and putting a lot of power in one person’s hands. I gather that that’s being addressed, that there is going to be, in whatever comes out of the negotiations, there is going to be a serious effort not to have one person solely responsible for what to do with all that money.

Fr. MARTIN: Well, I hope so. I mean, I think that, you know, you speak even to the experts who say they’re not sure how the plan would work. They’re not sure how much money is required, and so to put one person in charge to me just, you know, based on sort of simple economics doesn’t seem to make a lot of sense. You know, I also want to agree on what Jim Wallis said. You know, I think it is kind of a culture of greed. You know, I was thinking the other day, you have TV shows like “Flip this House” on A&E, and, you know, it’s something that everyone seems to have been infected by, and I think getting back to that notion of the common good, that this bailout should not just be from the top down but from the bottom up as well, is really important. I think that the people that also need some lobbyists are the poor.

ABERNETHY: Yeah, but to both of you, there’s a need, isn’t there? I mean greed is an important motivator in the kind of economy we have. So it’s not just a question of greed is it, Father Martin? It’s a question of unregulated greed, and if the greed is controlled, if that can happen, then that’s better, isn’t it?

Jim Martin

Fr. MARTIN: Right. I mean, I still believe in the capitalist system, and as Adam Smith would tell you, self-interest is what motivates that. So I’m not saying that needs to be set aside. What I’m saying is that the capitalist system, as we’ve seen, is not perfect, and you do need regulation, you do need the government to step in and care for such things. You know, we look at education, and people are fine with the common good there. I think we have to expand our notion on what the government, on what society needs to do in terms of their responsibility to the poor.

Rev. WALLIS: I think government should encourage innovation, but it must limit greed. Self-interest and success is one thing. Losing sight of what is best for the common good is another thing. So capitalism run amok here is really what’s happening, and so restoring a sense of what’s good for all of us is, in fact, the best business model. So we’ve lost something here.

ABERNETHY: So, which is to say oversight by Congress and by the firms themselves?

Fr. MARTIN: Right.

Rev. WALLIS: Yeah, and social regulation is going to be necessary. But I would say self-regulation will, too. Jim is right. We’ve all got into this culture of greed, the culture extolling greed as a value. In D.C., property values have doubled in four years. So what do they say? Take your equity value and take a loan against that and buy another house, and then you can rent that and pay for your mortgage and then buy a third house. The prophets say you add house to house to house to house — the whole thing falls apart, and that’s what’s happened, from Wall Street right down to a lot of our own families.

Jim Wallis and Bob Abernethy

ABERNETHY: Father Martin, just step back just a minute and, quickly, what are the big lessons here about, maybe, things that go beyond just the bailout itself?

Fr. MARTIN: Well, I think one thing is that, you know, these assets were highly valued because they were risky. In economics there’s a risk-return relationship, and I think one of the things we see that hasn’t been commented on is just that the CEOs sort of lost the sense of personal responsibility to their investors and, you know, to the people they were giving mortgages to. I mean, you know, you check out a lot of magazines in the past few months, they were talking about the coming collapse. It’s not, you know, it’s not as if people didn’t know this was going to happen, and yet the investment was still being made. So I think there’s a certain level, I agree with Jim Wallis, of personal responsibility that needs to be accepted by the CEOs. So in other words what I’m saying is it points out is that, you know, people really do have the responsibility for making conscientious decisions in the workplace.

ABERNETHY: Jim Wallis, quickly.

Rev. WALLIS: I think there’s an opportunity here for redemption. If our congregations begin to look at these questions — we ought to have adult Sunday school curriculum on money and how to be responsible in our economic lives. That could be a real opportunity for the pulpit to get involved here and start talking about what Christians and Jews and Muslims ought to do in responsible ways about how they live.

ABERNETHY: Reverend Jim Wallis of Sojourners and Father Jim Martin of America magazine, many thanks to you both.