Friday, December 19, 2008

Reflecting on the Economic Crisis

We have all been hearing it for the past 2 months. Bailouts, business downturn, recession, layoffs and negative reporting about the economy. Chances are, reading the news each morning is like consuming a daily dose of depression. If we want to find hope and encouragement in the media, we will need to look hard and invest some effort. Recently, three helpful articles were written by Jim Coggins, associate editor of The first deals with a diagnosis of the situation. The second identifies possible solutions on a government and corporate level. The third exhorts Christian leaders to act. In this article, I will briefly discuss the three and then suggest a bailout, proverbs style.

In the first article entitled "Crisis due to more than greed," (Dec 5th, 2008) Coggins collects a sampling of opinions to help make sense of what is going on. In what is more a diagnostic of the problem, Coggins argues that the crisis is not a simple matter of greed. Rather, it is something far more 'complex.' Without dismissing the greed factor altogether, Paul Williams of Regent College helpfully points out the short-term and long-term causes. The short term was attributed largely to the collapse of the housing market, known as the sub-prime problem. The longer term problem is caused by ill-conceived systems such as the pyramid structure affecting housing, stock market and others. The recent Madoff scandal where a pyramid style fund structure meant that in order to pay out older investments, newer and larger investments must be found. As long as new and larger investments are available, the profits for older investments are significant. However, when the credit crunch occurs, the structure crumbles like a stack of cards. Another view is that the current crisis is precipitated by 'over-consumption,' 'over-valuation' and materialism. As to the latter, it is a false idol which sooner or later will fall. Coggins ends the article by reminding people of the folly of trusting in false gods of materialism, and possessions. Such a disease affects both rich and poor.

The second article "Fixing the Economic Crisis," (Dec 11th, 2008) talks about fixing the problem. Here, it tries to suggest different ways which the different players can contribute toward stabilizing and helping the recovery of the economy. Governments must 'bolster consumer confidence.' At the same time, corporations should take the opportunity to level the playing field in the sense that having felt vulnerable like the poor and marginalized, future policies should be aimed away from any forms of exploitation. Badly managed companies should not get off scot-free. Inefficient companies should be allowed to fail. Governments should employ both short and long term solutions. Regulation is necessary and it is also noteworthy that any government intervention or financial stimulus should be temporary. Hopefully, when the economy of the rich is fixed, it will take a newer shape in that policies that come out of it will be fairer and gentler on the rest of the poor developing countries. Coggins concludes again with another reference to the economic divide between the rich North and the poor global South.

The third article "The economic crisis: What should Christians and the church be doing?," (Dec 18th, 2008) touches on the role of Christians and the Church. 8 points were suggested.
  1. Get Out of Debt: All Christians ought to make a point to get out of loans, to avoid spending borrowed money long-term.
  2. Teach: Churches to continue to teach about money and possessions, otherwise the church risk becoming irrelevant. There is a real battle to teach against making materialism a god.
  3. Sabbath-Keeping: I like this emphasis where each time we practice a day of rest, we take back control of our lives from the daily routines in the world, to pause at 'sabbath, jubilee and hospitality.' Not only should the Sabbath help us note self-control and our boundaries, it makes us celebrate the good creation God has given us. The first tells us how to say enough. The second urges us to point toward God.
  4. Practise Jubilee: This frees people from bondage of the past and help free those in bondage.
  5. Practise hospitality: he argues that if Christians have been prudent consumers all along, they are the ones most able to help drive the economic recovery.
  6. Prudent Spending: That one does not panic but spend wisely. For me, this also means not hoarding our wealth.
  7. Pray: Unfortunately, Coggins did not go far enough, and I sense that this is added as an after thought.
  8. Preaching the Gospel: People are more open to the gospel during this period, an opportunity to engage people with the good news.

I like Coggins' articles. The three parts neatly summarized the probable reasons for the current crisis, some solutions and some useful actions we as Christians can take. However, I will like to add one thing, that the way we see the current economic crisis reflects the kind of our relationship with God. Christians ought to be people who can live with plenty and also to live with very little, even nothing. Like what the Apostle Paul write to the Romans:

"If we live, we live to the Lord; and if we die, we die to the Lord. So, whether we live or die, we belong to the Lord." (Rom 14:8)
Whatever it is, Christians with a mind focused on God will not be easily distracted by commercial realities or economic uncertainties. Of all the actions suggested by Coggins, I feel that the one on prayer is least developed but the most potent. I will prefer to give Coggins the benefit of the doubt, that given time and space, he would have expanded on prayer.

Bailing Out - "Proverbs Style"
Perhaps a brief example how we can pray from Proverbs will suffice.
7 "Two things I ask of you, O LORD;
do not refuse me before I die:
8 Keep falsehood and lies far from me;
give me neither poverty nor riches,
but give me only my daily bread.
9 Otherwise, I may have too much and disown you
and say, 'Who is the LORD ?'
Or I may become poor and steal,
and so dishonor the name of my God. (Proverbs 30:7-9)
This remarkable prayer request recognizes the weakness of men to fall into either extreme poverty or excessive possessions. Both are not desired at all. The former tempts one to steal. The latter seduces one to ignore God altogether. Perhaps this is the prayer that Jesus is trying to teach us when he says: "Give us this day our daily bread." We do not need a 9-course dinner for a satisfied stomach. Neither do we deserve starvation that lasts for days. One of my favourite authors, Parker Palmer, suggests 3 ways to combat the dual extremes of scarcity and abundance. They are a) Education; b) community and c) Prayer. Bingo! That's the prayer emphasis again.
"...I do not mean 'saying our prayers,' ..... I mean a life that returns constantly to that silent, solitary place within us where we encounter God and life's abundance becomes manifest."
(Parker Palmer, The Promise of Paradox, San Francisco :Jossey-Bass, 2008, p114)
Today (Dec 19th, 2008) is another bailout day, when President Bush announces US$13.4 billion to bail out the troubled US auto industry. To date, $350 billion has been used in bailing out Wall Street and Main Street, ie over 77 days.

My question will be: Will the money be used to bring the whole system back to its unhealthy beginning? Or will it be a humbling experience for all the players to start repenting from bad governance and make an effort to reform their companies, and themselves? Much remain to be seen. For Christians, we have this clarion call: Go ye therefore and make disciples of all nations. I believe this includes the economy as well. Pray without ceasing.


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