Jump directly to the content

Q & A: Dave Ramsey

The popular Christian financial adviser on why he thinks the bailout is a disaster.

The government has rushed to aid several corporations in recent months, hoping to contain an economic crisis. President Bush urged Congress to pass a proposed $700 billion plan for the government to purchase troubled mortgage assets. Dave Ramsey tells Christianity Today why he is against the bailout and how Christians can prepare during an economic crisis. Ramsey's show is carried on 350 radio stations nationwide, and he is the author of several personal finance books.

What do you think of the bailout?

I think it's a disaster. It's the largest government department ever formed in the history of man, and they are doing it in five days, and they are doing it based on a spirit of fear.

There are other things we could be doing to calm markets. All of the Bush administration appears to be in a dead dog panic. I'm afraid it's going to pass, but that doesn't mean we're going to like it.

What do you recommend instead?

Change the market accounting rules. Do away with the capital gains tax, which will cause money to flood into the market instantaneously in 24 hours. Last, if we do need to do some insurance of some of these bonds, we can insure them rather than just buying them all. Only 7 percent of them are in foreclosure, while 93 percent of them are paying, so why are we buying them all—so we can make Paulson king?

Will the economical crisis affect how Christians will vote?

It translates into which person they think will go to Washington and give them the economy that they want. As a believer, I think that's a mistake. I think we're taught that God is to be our source. We've really got to stop looking to Washington to fix our problems. It obviously doesn't have the ability to do that. People who are successful are not successful because of the President.

You meet people who think Sarah Palin is the Second Coming. People who say, 'If we can get John McCain and Sarah Palin in the White House, everything's going to be okay," and it's not.

Should this affect how Christians give? For instance, should Christians give to nonprofits that have lost money through investments?

I think giving priorities should never have anything to do with investments anyway. It should be the ministry that is doing God's work, and what you feel God leading you to be attached to.

What will the crisis do to people's lifestyle?

Hopefully some of this will scare people straight. Some of the consumption level will go down, some of the debt level will go down, and people will save more money.

God's ways of handling money work: in the house of the wise are stores of choice food and oil (Prov. 21:20). Having cash on hand is a good thing, always having some money. Get out of debt; the borrower is a slave to the lender. These are things that worked 1,000 years ago, they worked 20 years ago, and they worked 20 minutes ago. They will work for the next 20 years.

The emotions in the last two weeks have been more related to fear that their bank is going to close, that somehow the mortgage company is going to take their house even if they pay their bills. The other emotion has been anger at the government for talking about passing this ridiculous bailout of Wall Street.

I don't know that I have necessarily heard anyone say, "I'm now convicted to straighten out my life." I think the net result is that when the emotional moment leaves, people will hopefully find some contentment in what they currently have and not have to constantly own something bigger and better just to feel good about themselves.


More from Christianity Today
Star Trek Into Darkness

Star Trek Into Darkness

Lots of explosions but not much heart makes this a film that will please most but might leave fans disappointed.
Forgiving Iran

Forgiving Iran

Long before I knew the true God, he helped me release my hatred.
Perdonando a Irán

Perdonando a Irán

Antes de conocer al Dios verdadero, Él me ayudó a liberar mi odio.
Get Instant Access
Christianity Today Magazine
Subscribe now for a year (10 issues) at $24.95 for print, iPad, and instant web access.

International Orders

Comments

Displaying 1–3 of 13 comments

Tim

October 05, 2008  9:13am

Dave Ramsey is a smart and wise individual financial counselor who has helped many. But if he thinks that removing the capital gains tax and providing mortgage insurance is going to unfreeze the credit markets and reduce the unwillingness of banks to loan money in this downward moving economy, I think he'd better go back and study macroeconomics again. While I agree that the bailout of the mortgage markets will not necessarily normalize bank lending practices, it might remove some of the anxiety of bankers so they'll provide the lending that businesses need to build inventory for the Christmas season of buying. Since 25% of annual retail buying takes place during the Christmas season, can you imagine what would happen if businesses could not provide the array of products necessary to feed the demand? Jobs would be lost, inflation would sky rocket, and GDP for the last quarter would plunge. The resulting recession could become a depression.

Gregg

October 01, 2008  2:28pm

Grumpy is right that the Defense Department has a large budget, fy 2008 with supplementals may reach 700 Billion. The base budget for 2009 is estimated at 515 billion. Perhaps he meant "trillion" but getting facts right goes both ways. The idea of being responsible, spending less than you make and having a good reserve is a wise course of action. Not expecting the government to fix everything is also a wise statement.

Jim Lagnese

September 30, 2008  3:18pm

What you left out Dave was getting rid of the CRA. If it wasn't for that, we wouldn't be here. Secondly, banks (or any other individual or entity) that make bad decisions should not be rewarded. In the free market sometimes a correction is needed and we'll be better off for it. What is the fear here, that you won't have cable for a year? Operating out of fear usually produces bad results. Slow this train down and lets have some rational talk. Jim http://www.therightguyshow.com

See All 13 Comments
You must be a Christianity Today subscriber to post comments
(on articles open to the public, you must at least register for a free account).
Login
or
Subscribe
or
Register

Don't Miss

Forgiving Iran

Forgiving Iran

Long before I knew the true God, he helped me release my hatred.
Why Willpower Fails

Why Willpower Fails

Your willpower is limited, so use it wisely.

Great Humility

Great Humility

The power of a neglected virtue

more | current issue

Books & Culture

A Measure of Forgiveness

A Measure of Forgiveness

Memories of a British...

Today's Christian Woman

Amy Grant: How Mercy Looks from Here

Amy Grant: How Mercy Looks from Here

The Queen of Christian...

Small Groups

Mental Illness Is Mainstream

Mental Illness Is Mainstream

We must help the one...

Facebook

CT eBooks & Bible Studies


Shopping