Economics

A reporter from The Wall Street Journal spoke to several people about the economy. One was Kristine Funck, a nurse in Ohio, has won steady pay raises, built retirement savings, and owns her home. The other was Alfredo Arguello, who opened a restaurant outside Nashville when the pandemic hit, now owns a second one, and employs close to 50 people.

Economists are noticing that while economic measures are improving, Americans are feeling gloomier. “Unstable” is how Arguello describes it. Said Funck: “Even though I’m OK right now, there’s a sense it could all go away in a second.” There’s a striking disconnect that has puzzled economists and business owners.

But press Americans harder, and the immediate economy emerges as only one factor in the gloomy outlook. Americans feel sour about the economy, many say, because their long-term security feels fragile and vulnerable to wide-ranging social and political threats.

Interviews with Americans across the country—some affluent, some just scraping by; some with advanced degrees and others with blue-collar jobs; some Republican, some Democrat—show they are weighed down by fears of an unpredictable world in which no one in government or business is competent to steer the nation through precarious times.

“You could argue unemployment is 3.7%, but who cares with this level of uncertainty?” said Arguello. “Because that’s what people are feeling. They’re not feeling hope. They’re not feeling one country. They’re feeling a divisive, divided United States of America.”

An article in The Wall Street Journal warns: “Your 401(k) is up. Don’t let it go to your head.”

Checking your 401(k) is the feel-good move of the year. After the stock-market rally, it now feels safe to peek at your 401(k) balance again. That is a relief for the millions of people whose retirement accounts are still recovering from the bruising they took in 2022, when the S&P 500’s total return was -18.11%.

Don’t let your self-worth balloon along with your net worth, financial advisers warn. They say the overconfidence that comes with making big gains can cause people to take bigger risks with their investments. And that makes us feel like we’re savvier investors than we really are.

Neuroscience backs up the idea of overconfidence being a problem. Research on the brain has found that increases in dopamine, a brain chemical that likely gets released when you see large returns in your account, can lead to more financial risk-taking.

Possible Preaching Angle:

That’s good financial advice, but the Bible also warns that, more importantly, it’s good spiritual advice.

About seven in ten respondents in a survey said they strongly or somewhat agreed with the statement: “Having more money would solve most of my problems.” Similar proportions of people in each income bracket felt that way, including those with salaries of $200,000 or more.

Exactly how much more money do we think we need to be happy? A survey from the financial-services company Empower put the question to about 2,000 people.

In the survey, most people said it would take a pretty significant pay bump to deliver contentment. The respondents, who had a median salary of $65,000 a year, said a median of $95,000 would make them happy and less stressed. The highest earners, with a median income of $250,000, gave a median response of $350,000.

Even very wealthy people think like this. A 2018 study asked millionaires to rate their happiness on a scale from one to ten and, if they didn’t say ten, predict how much money they would need to move one point higher. Slightly over half of those with a net worth of $10 million or more said their wealth would need to increase by at least 50%.

The American dream—the proposition that anyone who works hard can get ahead, regardless of their background—has slipped out of reach in the minds of many Americans.

Only 36% of voters in a recent survey said the American dream still holds true. This is substantially fewer than the 53% who said so in 2012 and 48% in 2016 in similar surveys. When a Wall Street Journal poll last year asked whether people who work hard were likely to get ahead in this country, some 68% said yes—nearly twice the share as in the new poll.

The survey offers the latest evidence that Americans across the political spectrum are feeling economically fragile and uncertain that the ladder to higher living standards remains sturdy, even amid many signs of economic and social progress.

Daniel Skeel serves on the faculty of UPenn Law School, specializing in bankruptcy law. In recent years he has been increasingly bold in bringing his faith to bear on his scholarship. Much of that witness can be traced to what he sees as the New Testament’s inescapable—and inescapably radical—understanding of debt (and debtors).

Skeel reflects,

There came a point, where I realized that the story of the Gospel, and the idea of the fresh start with bankruptcy, are very closely parallel. The idea is that you’re indebted beyond your ability ever to escape that indebtedness (and) you can’t get out on your own. It’s almost exactly the same trajectory as the idea of who Jesus is from an evangelical perspective. (It) emphasizes that reconciliation with God can come only by embracing Christ as the Savior, not through a believer’s good works.

This sort of language might cause some hearers to balk (how simplistic!), but its pastoral traction cannot be denied. Not among those carrying student loans, not among those with mortgages, to say nothing of those asked to repay a “debt” to society. Debts weigh on people, and the prospect of the clean slate has a gut-level allure and immediacy, whatever your financial situation.

In other words, it’s not an accident that Jesus used so much debt language. It’s not something to be minimized. And not just because it’s timeless, but because it’s profound. What other type of imagery could make the burden of sin—and sin’s forgiveness—more concrete?

Should consumers who worry about the origins of their clothing, coffee, and chocolate focus on a more spiritual item: the Bible? Chances are good that your favorite Bible was printed in China. The over-whelming majority of Bibles sold are printed there, said Mark Bertrand of Bible Design Blog. He said: “A lot of people have misgivings about that. Some of it is, ‘Oh, our Bibles are printed in Communist China.’ Others are concerned about the economic situation, about what conditions these Bibles were produced under.”

The Chinese government’s restriction of Bible distribution is also troubling, said ChinaAid’s Bob Fu. “When brothers and sisters are being persecuted and arrested for their beliefs based on the same Bible, what does it mean to purchase an exported copy that says Made in China?”

China’s only legal printer of Bibles, Amity Printing Company, published its first Bible in cooperation with the United Bible Societies in 1987. Since then, more than half of the 100 million Bibles printed every year have been printed in China (50 million in 2019), making China the world’s biggest Bible publisher.

Printing Bibles is more difficult than printing other types of books, and requires a certain amount of expertise. That’s because of the specialized printing requirements for a complex book such as the Bible. Bibles require thin paper that cannot be fed into standard printing equipment, leather covers, stitched binding, color pages and special inserts such as maps. Most printers outside China do not have the range of facilities to manufacture the same Bibles.

Possible Preaching Angles:

1) Maybe Westerners seeing “Made in China” on their Bibles, can be a reminder to pray for those who made these Bibles. 2) God can use any instrument he chooses to spread his Word, even unbelieving, communist China (Isa. 55:11).

True or false: In general, bigger donors to churches, ministries, and charities give more because they have more ability to give.

Answer: It’s a trick question. The correct answer, to some extent, is both true and false.

The true part is that people with more money do tend to give away larger amounts of money. Grey Matter Research studied evangelical Protestants in 2021. Among donors, they found median giving to church and charity in the past 12 months was $2,200 when household incomes were $100,000 or more, dropping to just $200 when incomes were below $30,000. Clearly, higher-income evangelicals give more.

The false part is that when you evaluate giving amounts as a percentage of household income, they saw almost no difference in generosity between more affluent and less affluent evangelical donors. (Generosity is simply the proportion of household income that is given away.)

Donors with household incomes below $30,000 give away a median of 1.5% of their pre-tax income. The median is a nearly identical 1.56% when incomes are $30,000 to under $60,000. It does rise slightly to 1.85% with incomes of $60,000 to under $100,000, but then falls again to a median of 1.56% among donors earning six figures.

In other words, evangelicals who give money generally do so at a pretty consistent (and consistently low) rate, no matter what their income is like. But 1.5% of $100,000 is obviously twice as much cash as 1.5% of $50,000, so the amount of money rises as income rises.

Regardless of whether you consider tithing to be a biblical mandate or guideline, the chances are you’re not close to it: only about 13% of evangelical Protestants give anything close to a tithe.

Charitable giving went up nearly five percent during the economic trouble caused by record inflation in 2022, according to a Fundraising Effectiveness Project study of American nonprofits. The number of donors, however, declined by about seven percent—fewer people gave more money.

Number of megadonors -0.4%

Number of medium donors -1.4%

Number of small donors -13%

Money given +4.7%

Writing in the Atlantic, author and researcher Arthur C. Brooks says, “Money is one of the things Americans worry about most in the world.”

One survey found that even when the US economy is thriving more than half of Americans felt anxious or insecure about money sometimes, often, or all the time. And during the COVID pandemic, another survey found that workers were almost five times more likely to worry about money than their health.

But many of us really don’t need to worry about money. Only 11 percent of Americans live in poverty. And yet, according to a recent survey, more than half of Millennials with a net worth greater than $1 million feared losing their wealth “a great deal” or “somewhat,” as did more than a third of similarly wealthy Baby Boomers.

Brooks concludes, “For millions of people, then, worrying about money is not a reflection of whether their basic needs are being met. In fact, this anxiety reflects deeper concerns that money can’t solve.”

The pandemic has done a lot of strange things to the global economy over the last 14 months, from creating a massive shortage of semiconductor chips to a ballooning supply of hand sanitizer.

The US housing market has gone haywire too, as urbanites took advantage of remote work to leave expensive cities and resettle in smaller towns across the US. But it's not all that simple. Glenn Kelman, the chief executive of Redfin, broke down some of his observations of just how unusual the current US housing market is in a Tuesday Twitter thread:

Inventory is down 37% year over year to a record low. The typical home sells in 17 days, a record low. Home prices are up a record amount, 24% year over year, to a record high. And still homes sell on average for 1.7% higher than the asking price, another record.

It has been hard to convey how bizarre the US housing market has become. For example, a Bethesda, Maryland homebuyer included in her written offer a pledge to name her first-born child after the seller. She lost.

Possible Preaching Angle:

God’s people have no such worry. We have a guaranteed home in heaven, personally prepared by Christ, reserved in heaven for us. And, we should mention, it is fully paid for.

A thriving stock market (measured by the S&P 500 index) doesn’t translate to more charitable giving. According to a decade of data collected by the Evangelical Council for Financial Accountability:

• When stock value increased nearly 30 percent in 2013, giving to charity decreased by about 1.5 percent.

• Stock value went up more than 11 percent in 2014, and charitable giving from individuals and organizations increased by nearly 6 percent

• Stock value declined slightly in 2015, while giving increased another 5 percent.

• Rates of giving also appear to be disconnected from changes in median household income and gross domestic product.

The percentage of disposable personal income Americans spent on food in 1935: 24.2 percent

The percentage of disposable personal income Americans spent on food in 2005: 9.9 percent

The percentage of disposable personal income Americans spent on food in 2022: 11.3 percent

Editor’s Note:

Consumers spent 5.62 percent of their incomes on food at supermarkets, convenience stores, warehouse club stores, supercenters, and other retailers in 2022 and 5.64 percent on food at restaurants, fast-food establishments, schools, and other places offering food away from home. In 2022, the share spent on total food had the sharpest annual increase, 12.7 percent. This followed an 8.2-percent decline, the sharpest annual drop in total food spending since 1967, during the first year of the Coronavirus pandemic in 2020.

The recent volatility in spending was driven by consumers’ sudden drop in eating out at the beginning of the pandemic followed by a return to food-away-from-home purchases as pandemic-related restrictions and concerns eased.

Economists have long argued about whether theirs is a value-free science. Robert Nelson, an economist at the University of Maryland, emphatically says that it is not. Yes, he admits, economists provide technical knowledge. But, he contends, "Another basic role of economists is to serve as the priesthood of a modern secular religion of economic progress that serves many of the same functions in contemporary society as earlier Christian and other religions did in their time."

Our whole society ... is focused on the celebration of Christmas. With the excessive commercialism which begins in our country immediately after Halloween (once it started the day after Thanksgiving), with the secular gaiety and extravagant glitz, with the sickening efforts to sanctify profit-making, the "Reason for the season" (that's the by now too-commonplace cliche among evangelicals) is ignored more often than not. The mind-boggling mystery of God-in-the flesh tends to become a mere stimulus for our economy.

For the Christian, the bottom line can never be the bottom line.

American Puritans were hardworking but not capitalists in the modern sense. They placed common welfare ahead of self-interest and set modest caps on profit-making. Unemployment was virtually nonexistent in New England. A visitor from abroad testified, "In seven years I never saw a beggar."