Two young girls sit on the front porch of an idyllic suburban home, staring at the wonder that is the modern smartphone. After one girl lists all the things the smartphone can do—“I can watch movies on it, read a book, talk with my friends on the other side of the country, face to face!”—the phone comes alive.
In a cheery British accent, the smartphone names its seemingly unlimited features, prompting the other girl to say, “I want one; make me one!” The smartphone then explains that “no one knows how to build even one of these things”—that millions of inventors, designers, miners, oil drillers, and factory owners around the world are needed to create just one. The smartphone enthuses that the competitive forces between smartphone providers help “inspire my company to make me more fabulous!”
While the girls listen in awe, the smartphone concludes that its existence seems “magical.” And when it comes to grasping the reach and forces of the market system, magical seems the appropriate word. Markets have enabled progress and prosperity far beyond what anyone even a century ago could have imagined. Productivity per person, an enhanced standard of living, and the incentive for innovation all trace back to the forces of the market system (the producers, buyers, sellers, and others who participate in the creation, distribution, and use of a product or service). A well-functioning market offers lower prices and higher quality products. Indeed, as the smartphone reminds us, when we consider the various goods that emerge out of the “flowering of free cooperation, competition, and creation,” we have reason to marvel.
This is the lesson of I, Smartphone, a short film created in 2012 by the Institute for Faith, Work & Economics (IFWE). The film pays homage to economist Leonard Read’s 1958 essay “I, Pencil,” in which a pencil describes all the economic forces, materials, and human labor that combine in the production process (what economists call “spontaneous order”) to create him.
Read’s essay creatively illustrated Adam Smith’s invisible hand concept, and philosophers and political conservatives have canonized it as an apologetic for the free market. IFWE created I, Smartphone for similar reasons, but with an eye toward theology and vocation. As the Virginia-based think tank explains:
. . . God has given us the market process as the most powerful tool we have in a fallen world to serve each other by using our gifts.
Yes, that’s right.
Smartphones allow thousands of dispersed people from across the globe to bring their gifts to serve people they don’t even know, and most likely never will know.
At IFWE, we see Jesus in that: helping people without knowing who they are, without discrimination, but within the context of using your gifts as God has called you.
Is it really that simple?
The Coltan Conundrum
One thing that the chatty smartphone fails to mention are market externalities—a euphemism for unintended consequences. Here’s one: Nearly all smartphones (and many other electronics) contain a chemical element called tantalum, also known as coltan. The majority of coltan comes from the Democratic Republic of Congo, an utterly war-torn, poverty-stricken country, and one of the worst places in the world to be a woman. The DRC is also one of the most mineral-rich countries, and its resources have been aggressively, even savagely, plundered by other countries for centuries.
All this pillaging has helped create a corrupt DRC government, warring factions, and a general sense of hopelessness. The United Nations, in addition to other international groups, has documented the illegal smuggling of coltan from the Congo, a process often accompanied by rape and murder. These sobering realities clearly counter IFWE’s sentiment that “we see Jesus” in the process of creating smartphones, and that we are “helping people without knowing who they are, without discrimination.”
Some DRC citizens, such as coltan traders and miners, benefit from market forces. Others are tragically harmed in the process. This hardly seems like a faith-based approach to wielding the market system to serve others. That said, measures can and have been taken to distinguish between legitimate mineral mining and illegitimately obtained minerals (“conflict minerals”). One such example is the recent Dodd-Frank Act, which requires technology companies to report where their materials come from. But reactive legislation is hardly a praiseworthy outcome of markets; neither is the “magical” processor depicted in I, Smartphone a pure gift from God. At the very least, market externalities like rape and murder give us Christians reason to pause.
To be clear: I am an advocate for the market system. Better than any other economic system, it fulfills the goals of economics: to create, sustain, and distribute goods and services that benefit entire populations. However, what may be best is not the same as what is perfect. Those who want to sanctify the market often dismiss very real labor-ethics concerns (such as conflict minerals like coltan). We can easily note other repugnant effects of the global supply chain: child labor, fatal fires in clothing factories that lack appropriate exits, low wages, and large corporate demand for products unaccompanied by an eye toward workers’ rights. The market is regularly tempted to think of humans less as persons and more as “factors of production.”
What, then, is a Christian to make of this? Responses have been polarized. Some Christian ethicists criticize the hyperconsumerism, power relationships, and inequality produced by markets. Some have called for a totally new economy, advocating distribution systems that close the gap between rich and poor. Some see this as a function of the church (“radical orthodoxy”). Alternatively, others demand greater state intervention (“liberation theology”). Where the former tradition, in the words of theology professor Stephen Long, proposes that the “task of the church is to produce countless alternatives” to the reigning economic order, the latter patently rejects capitalism as an economic system because of the inequality and material poverty it allegedly produces.
Other Christians believe that the market system is the biblical ideal. The free enterprise mechanism, they argue, champions personal freedom, rewards virtuous behavior such as honesty and prudence, and best creates wealth as a tool to fight poverty. American Enterprise Institute president (and Christian) Arthur Brooks recently claimed that markets are not only a more efficient means of wealth creation and distribution (in contrast to government intervention)—they are a moral imperative. In a 2012 article, he writes: “Everyday Americans [need] to stand up for free enterprise—not just because it makes us better off, but because it makes us better.”
Is there a way to close this gap and find common ground? I believe there is. UK political philosopher Jonathan Wolff says that for an economic system to survive, it need not be optimal, just superior, to other systems. It doesn’t have to be perfect. It just has to be the best available option in an imperfect world. As an economist and a Christian, this strikes me as a helpful vantage point in moving the market debate forward.
To be sure, I do not think such a weighty and long-standing debate can be so easily settled. Still, I submit that this “superior system” argument offers several helpful perspectives for the Christian concerned about justice and the least of these.
First and foremost, we should begin by stripping markets of their spiritual labels. This does not mean we can’t morally evaluate the free-enterprise system. But describing the market system as either “evil” or “divine” is no more helpful than using such labels to evaluate an entrance exam or a train schedule.
If markets as such are not moral or immoral, good or bad, what is there left to say? This is where Christians can give critical and biblically minded scrutiny to market externalities—to outcomes and consequences. For example, those who dismiss markets altogether must answer: What is the alternative? Two responses are generally given, one practical and one theological.
At the practical level, most critics of the market system advocate some form of a planned economy, in which decisions regarding the production and distribution of goods and services are made by a central authority, usually the government. But this only introduces new problems. In planned economies, we do not see the same level of innovation or effectiveness. And it’s hard to imagine a planning authority successfully coordinating all of the productive resources necessary to create a smartphone, a nearly impossible task.
Planned economies also hinder the supply and demand forces that ultimately provide consumers with the best prices. The market price is one of the most important features of the modern free-market system, and its absence would lead to underproduction, a shortage of goods and services, a surplus of demand, and, in general, chaos. The economy of the former Soviet Union serves as a prime example, where overproduction of some materials, underproduction of others, slow growth, lack of innovation, limited trade, and social unrest became the norm.
We must also note that a paternalistic environment usually discourages human creativity, initiative, and industry. And these are all ways in which we bear the image of God. There is a spiritual cost to a planned economy.
The theological level offers other proposals. One example is Kathryn Tanner’s 2005 book, Economy of Grace. The Yale theologian calls for a “theological economy,” in which grace is the operative principle and unconditioned giving is the result. As admirable and kingdom-like as this perspective is, it’s hard to imagine its adoption in policy circles anywhere in the world.
Still, even if the alternatives to a market economy are found wanting, we must not (as some market champions are tempted to do) downplay or ignore what is sometimes called “collateral damage.” Some argue that if the market is inherently good, we don’t have to think too deeply about some of its horrific consequences, because the market itself will take care of all that. Sometimes it does—and sometimes it doesn’t. U.S. child labor laws were needed precisely because the market was not making appropriate corrections back in the day.
In addition, the “moral market” perspective risks relegating our deepest values to questions of “efficiency” and “growth.” Each semester I share an article with my students about how a young woman in New Zealand sold her virginity online in order to raise money for college. The winning bid was $45,000. Most students grimace or shake their heads as I detail this market exchange. But they often conclude that this was indeed a legitimate market: her need was met (money for college), and the value of virginity is, evidently, $45,000 in New Zealand. A “market” was present in the transaction: Two informed and consenting agents freely entered into a mutually beneficial exchange. And yet the externality is human degradation.
Or take the now infamous 1991 memo written by then–World Bank chief economist Larry Summers. In the memo, he suggested that an open market in toxic waste between developed and third-world countries was economically efficient and mutually beneficial for both groups. (In exchange for dumping their toxic waste, developed countries would pay cash to the less developed countries who would inherit it.) The memo referred to the economic logic of dumping toxic waste in low-wage countries as “impeccable.” Still, the moral logic is reprehensible.
More Than a Cleanup Crew
So, attending to the externalities provides a natural balance by which to appreciate the benefits of markets without deifying them. Of course, this risks Christians being merely reactive, serving as a cleanup crew for market hiccups, rather than challenging the very forces that created such infractions in the first place.
But nothing could be farther from the truth. Christians can, and should, actively advocate for the environment that best makes for free markets and allows them to flourish so that humans can flourish. In her book Why Some Things Should Not Be for Sale, Stanford ethicist Debra Satz says that in Adam Smith’s classical economic vision, markets flourish when they are grounded in property rights, with appropriate government regulation and social conventions. In other words, well-functioning markets do not so much
produce these attributes; they need to be grounded in them. Thus Christians can be actively involved in shaping the regulatory environment and the moral and ethical social conventions that allow for healthier markets.
One small but significant example: My wife contacts the companies from which she buys clothing and various household items. She does this to champion just and ethical labor conditions, wages, and workers’ rights. Additionally, she connects with the lawmakers active in corporate legislation. She participates in the market, but her advocacy, motivated by her Christian faith, aims to shape the regulatory environments of markets.
Small as this example may seem, a collective effort would have a significant effect. (I constantly remind my students that they are the economy.) If we understood ourselves as active members of the economic environment, markets would flourish in a healthier manner.
Economics is in the business of maximization, that is, of what is “best.” And there is good reason to advocate for a free-enterprise system. Whether it be a pencil, a smartphone, or any other innovative product or service, markets mobilize production, growth, and efficiency. They tend to allow for the most optimal distribution of scarce resources. In the grand competition of economic systems to achieve these outcomes, markets win.
Yet we live in a world of consequences, good and bad. In an increasingly globalized age that is still, in many ways, in its infancy, this is a crucial point. The Democratic Republic of Congo is mired in war, violence, corruption, and hopelessness. At home and abroad, we still see considerable poverty, which leads to a gross power asymmetry between the rich and poor. It would be tragic, not “magical,” if our consumption of goods and services only made matters worse.
As people of faith, we need not deify or demonize the market. Instead, I propose we focus on ensuring that the market’s consequences create the least possible damage and the greatest common good for our neighbors near and far. The market may be one gift from God, but he’s given us a greater gift in the church. Together, we can watch out for the most vulnerable members of society lest they slip through the cracks of our global marketplace.
Kevin Brown is an assistant professor at the Howard Dayton School of Business at Asbury University.
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