Thursday, May 25, 2006

Christianity and capitalism

The Times May 25, 2006

A capital gain for everyone


IT IS A characteristically Anglican mixture of breast-beating, self-congratulation, waffle and wishful thinking. But in the 100-odd pages of Faithful Cities, the Church of England’s new report on urban poverty, there is one glaring absence. The real poverty-busters — the people who create wealth and jobs — feature nowhere at all. Business appears only as a greedy and unwelcome backdrop.

Mercifully, the committee of clerics, do-gooders and hand-wringers (not an entrepreneur among them) who wrote the report do not repeat all the pseudo-Marxist gobbledegook of Faith in the City 20 years ago. They grudgingly admit that Britain has got richer in the past 20 years, though their simplistic parody of economic history gives no credit to the benign effects of union-busting, privatisation and deregulation under the Conservatives, nor to the low inflation and sound money policies of new Labour.

Instead, they try to solve poverty by spraying it with jargon, of the kind produced by people trying to sound profound when hopelessly out of their depth.

“It is a salient fact that market capitalism goes into decline if the market is populated by people who exercise self-restraint, are aware of the needs of others and reflect on the wellbeing of the planet.”

That’s a bizarre misunderstanding of the economic system that has lifted billions of people out of poverty. Capitalism depends on rules (contracts, property rights) and self-restraint (if you don’t save, you don’t accumulate capital). And if you ignore the needs of others, you go bust fast.

Wealth does not mean selfishness. Private philanthropy is a huge force for good in America now, and used to be in this country too, before taxation eradicated the charitable instinct of the rich. Big government, by contrast, has a dismal record, and the ghastly slums and ghettos it has created are true temples of misery.

So, encourage prosperity, generosity and mobility. Capitalism brings all three. But instead, the report bangs on about “faithful capital” (which seems to mean a collective conscience). But using the C-word ties the authors up in knots. Archbishop Rowan Williams’s foreword to their report moans that it has a “doubtful aura”.

That queasiness is paradoxical. “Capital” is the only word in the report that is meaningful and counters poverty. Britain’s inner cities could do with more capital, and fewer reports.

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