This article originally appeared on the blog of Heretic, the magazine of We Are Libertarians.
The idea of “Jubilee Economics” has been appearing in the public discourse more and more since the onset of the COVID-19 pandemic. But what exactly is Jubilee? Who does it help? Why should it be implemented?
Through this eight-part series, Heretic editor Ryan Lindsey gives an ethics- and faith-based case for the radical economic and social concept of Jubilee.
Inequality Leads to Financial Crisis
Before diving into this part of the series, I want to urge you to first watch this brief video about global wealth inequality. It’s slightly less than four minutes long, but does a great job of providing some context for the rest of this piece.
If you’re anything like me, many of the figures in that video are shocking. 300 people have more wealth than all the other inhabitants of China, India, the U.S., and Brazil combined? How can this be? And how have so many of us accepted this state of inequality as normal, and even as right and morally justified?
The ancient Jewish laws and customs had strict rules against charging interest on loans. The very concept of interest would have been foreign and even repugnant to many in that society. Their entire understanding of loaning was that loans were given to those in difficult times who did not have enough – loans were a way for the haves to help the have-nots, and the Jewish scriptures made it clear that the haves not be seeking profit from the misfortune of others in the form of interest (Leviticus 25:35-38).
Turning to the Gospel of Luke, we can see that this anti-interest sentiment was clearly endorsed and espoused by Jesus. (Keep in mind that Luke wrote this gospel with a rather bourgeoisie audience in mind – the fact that there are so many instances of radical social and economic teachings in the book attests to the unrivaled radicalness of Christ, given that if any of the Gospels were to have watered down that aspect of Jesus’ teachings, it would have been this one.)
First, here is a passage from Luke 6:
32 “If you love those who love you, what credit is that to you? For even sinners love those who love them. 33 If you do good to those who do good to you, what credit is that to you? For even sinners do the same. 34 If you lend to those from whom you hope to receive, what credit is that to you? Even sinners lend to sinners, to receive as much again. 35 But love your enemies, do good, and lend, expecting nothing in return. Your reward will be great, and you will be children of the Most High; for he is kind to the ungrateful and the wicked. 36 Be merciful, just as your Father is merciful.
A common refrain of those who oppose Jubilee economics and the cancellation of debts is that cancelling debts would result in the end of lending, and this will ultimately hurt the poor and desperate who need loans the most. The late Mennonite theologian John Howard Yoder addressed this claim in his seminal work, The Politics of Jesus:
But how can one avoid the freezing of credit if one rejects the bait of profit? In the Sermon on the Plain Jesus gives the answer. The rich should be generous, rejecting the fear of not being repaid, because God will take care of them.
Rev. John Howard Yoder, The Politics of Jesus, 1968
Jesus tells a Parable in Luke 12 that shows the opposite of “the rich being generous” happening:
13 Someone in the crowd said to him, “Teacher, tell my brother to divide the family inheritance with me.” 14 But he said to him, “Friend, who set me to be a judge or arbitrator over you?” 15 And he said to them, “Take care! Be on your guard against all kinds of greed; for one’s life does not consist in the abundance of possessions.” 16 Then he told them a parable: “The land of a rich man produced abundantly. 17 And he thought to himself, ‘What should I do, for I have no place to store my crops?’ 18 Then he said, ‘I will do this: I will pull down my barns and build larger ones, and there I will store all my grain and my goods. 19 And I will say to my soul, Soul, you have ample goods laid up for many years; relax, eat, drink, be merry.’ 20 But God said to him, ‘You fool! This very night your life is being demanded of you. And the things you have prepared, whose will they be?’ 21 So it is with those who store up treasures for themselves but are not rich toward God.”
This parable tells of a rich man who rejects generosity in favor of ever more hoarding. Jesus spoke this parable to crowd made up of already-hungry people, many of whom were impoverished themselves. The injustice of hearing of the rich building ever-and-always larger barns to store their excess would have been all to real for these folks.
The Bible is full of lessons about the morality of being satisfied with enough, rather than always striving and conniving for more. We can see this in the story of the manna sent to the desert for the wondering Hebrew tribes, as they were told to only gather what they needed for that day. We can see this in the story of Jesus feeding the 5,000. We can see this when Jesus prayed for all to receive their daily (not weekly, or monthly, or yearly) bread.
One of the many lessons of the Bible is that the earth is abundant. There is more than enough for everyone, so long as we all share, reject greed, and embrace radical generosity. As William Tyndale, the man who translated the Bible into English in the 16th century, said: “Whatever we have that is superfluous we owe to those who do not have enough.” The mirror of this lesson is that acquiring and holding on to more than you need while others’ needs are unfulfilled causes problems.
Woe to you who join house to house,
who add field to field,
until there is room for no one but you,
and you are left to live alone
in the midst of the land!
While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation.
Pope Francis, November 2013
One of the several causes of the global financial crisis that began in 2007 is the ride of wealth and income inequality. In the lead-up to that crisis, the richest 85 people on earth – enough to comfortably fit on most passenger airplanes – had as much wealth has the poorest half of the world’s population. That’s over 3,500,000,000 people. When incomes increase across all wealth levels, generally speaking the rich spend less of that increase than poor people do. Rather than spend the bulk of that income increase, the rich are more likely to “save”. The trick is that in our financial system, saved money doesn’t just simply sit in a bank account waiting to be used. No, “saving” is not an accurate term at all. Rather, “savings” are lent out to people – many of whom are poor or middle class – in a variety of ways.
And of course, that money is lent out with interest (which Jesus opposed). As the interest compounds and is paid on without end, more and more money is funneled to the rich from the rest of us. This leads to an increase in inequality, which leads to more money being lent out to those on the short end of inequality, which leads to more money being transferred to the rich. etc.
This awful cycle continues until lenders begin to worry that they’ll lose the money they’ve lent out, and so they stop or slow down their lending. Of course, this leads to an overall slowdown of economic activity (due to our system being built on fiat and debt), which causes a recession. And of course, recessions lead unemployment and stagnant or falling incomes.
Now, I’ll be the first to own that that is a simplified version of the 2007 economic collapse, but I still believe it holds valuable truth and can help shed light on what happened and what will continue to happen. Former Canterbury Archbishop Rowan Williams as warned of the danger caused by income inequality and debt for years, saying that the two cause “a spiral of asymmetry, which is where the gap between the creditors and debtors gets wider and wider. There is no particular reason why this should ever stop, that is unless we decide to try and stop it.”
The 20th and 21st centuries have (so far) been a continuing story of financial crises across the entire planet.
- The Great Depression of the 1930s and 40s
- The energy crisis of the 70s
- The developing world debt crisis of the 1980s and 90s
- The East Asian financial crisis in the 1990s
- The American and European Financial Crisis of the late 2000s
- The economic collapse brought on by the 2020 COVID-19 pandemic
In the 1950s and 60s, the number of governments that struggled to pay their national debts averaged four every 20 years. Since the 1970s, that number has risen by four almost every year. Similarly, the number of times that banks required bail-outs worldwide has increased from once in the 1950s and 60s to nearly 30 times at present.
These crises are not inevitable!
Without resorting to aggressive and inefficient government tax policies, or to the idealistic notion of Jubilee that I advocate, one way to help reduce inequality is through unions and workers advocacy groups. A revival of blue and white collar unions (and a strong alliance between the two) would do wonders to raise wages for the workers of the world.
Of course, inequality is not just linked to economic problems. Try to take in this staggering fact: according to the United Nations, nearly 1 billion people do not get enough food to eat. Think of that fact beside the massive amounts of food waste and decadence that many of us exist in every single day.
Kate Pickett and Richard Wilkinson, in their book The Spirit Level, show that richer countries with more equal societies tend to do better than rich and unequal societies in areas like physical/mental health, child well-being, and crime and violence. This is good news, gospel. More equality is better for everyone. Maybe not financially better for everyone, but better all the same.
Go back and re-read the passages from Luke 6 and 12. Put aside your preconceived notions about wealth, inequality, capitalism, etc. and ask yourself: What was Jesus saying about inequality, greed, and generosity?
How does economic inequality affect different demographics of people? What (if anything) do you think Jesus would have to say about this?
How can you help make your society more equal?