Jay Richards, a distinguished fellow at the Institute of Faith, Work, & Economics, and a senior fellow at the Discovery Institute, has written numerous books and articles since receiving his Ph.D. from Princeton Theological Seminary, on subjects ranging from theology to Intelligent Design to economics. Richards and his wife Jenny have 10- and 14-year-old daughters whom they teach at their home in Potomac Falls, Va.
I like your book Money, Greed, and God. Have you given it to your 14-year-old? I have just started her on it, although I’ll reserve their junior and senior years for heavy economics. But it is books like that or Henry Hazlitt’s Economics in One Lesson, more than standard college macroeconomics classes, that can teach students to think in terms of costs and benefits or trade-offs.
What’s the most important economic discovery made in the 20th century that students don’t learn about? Probably the disconnect between intentions and consequences. Once you understand that, and you hear, “Congress wants to raise the federal minimum wage to $20 an hour,” you say, “That sounds nice, and then what will happen?” Ironically asking and then answering that question is probably the most important economic and intellectual discipline.
Consequences trump intentions? God cares both why we do something and what we do. If I give my wife two dozen roses and it’s not our anniversary or her birthday, that’s an intrinsically nice thing to do. But what if I want to go on my fourth golfing outing weekend of the year, and I want to grease the skids? The internal matters to the moral act. That’s not true in economics. The motives of the members of Congress who vote on a bill do not matter. They could have 535 different motives, but that policy is going to have the same effect either way.
As Adam Smith said, the bread maker is not making the bread that day because he feels nice or wants to be nice to us. He wants to make money. He wants to feed his own family by helping us feed our own families. And Smith was not saying what Ayn Rand said, that selfishness is a virtue. His point is that in a market economy with the rule of law, people’s actions—even if they’re self-interested—will be directed toward socially beneficial outcomes. It’s a hugely important insight. The human race is fallen and so the best we can do is say, What are the economic systems that will fit human beings as we actually exist in the world, prior to the consummation in the kingdom of God?
So we have to learn to distinguish economic ideology from empirical reality? That’s especially difficult in economics because a lot of people don’t think you discover things about economics. People often just think economics is just ethics, so I can get my way to a conclusion intuitively. I would maintain that part of reality is scarcity. There is a known relationship between supply and demand. We know what the function of prices are in a market; and so you can either know those or not know those, accept them or ignore them, but you can’t legislate them away—and if you ignore them you’re likely to get into trouble.
Scarcity does not exist outside of God’s sovereignty? Exactly.
So people who can make use of stuff that would otherwise be wasted are heroes. Tell us about Brad Morgan. Morgan is a Michigan dairy farmer who was paying $70,000 a year just to have the manure hauled off his farm. He figured out a way to turn manure into compost in a month, rather than the many months it used to take. Entrepreneurs inevitably have intimate knowledge of things that other people might consider boring: Practical wisdom allows them to use their skills and their creativity in a way that other people can’t, and now Morgan sells his stuff, called Dairy Doo.
He has about 15 different varieties, right? Different grades or different roasts. It’s the perfect metaphor for entrepreneurship because he literally takes waste and creates wealth with it. It’s a prefect parable to explain the reality that human beings are a unique hybrid of the spiritual and the material, able to take the material world that God has created and transform it into wealth that wasn’t there before.
And journalistically specific rather than ideologically abstract. We need to ask: What are the real discoveries about the economic realm that we need to take on board, when we are thinking about these subjects?
When conservative Christian parents are concerned about what their kids are learning about economics, what do they typically do? Parents try one or two things. Some think, I’ll quarantine my children. That is a temptation among some homeschoolers: Protect them from the world. But if the virus is still out there in the world: Unless you keep them locked up, they are getting exposed at some point, and they will not have built up their resistance. I saw this in seminary. I went to a couple of liberal theological seminaries, and kids would come from Bible colleges where they just hadn’t been exposed to the arguments that are out there. They lost their faith in a semester or two semesters. So quarantining is a bad idea, I think, for preparing our kids.
What’s the other common tendency? Overexposure. That’s the other extreme where you cast them as sheep among wolves and hope they’ll toughen up.
Can we find a golden mean? Inoculation: measured exposure to a pathogen. We can be inoculated against smallpox by getting an injection of cowpox to which your body reacts. It develops antibodies and then protects itself from the more harmful pathogens. We need to think about ideas in the same way. You don’t want your kids to get off to college and just then hear the best arguments for Darwinism. That’s the wrong time to have that happen. They need to have been taken through those things beforehand and not in a cranky, one-sided fashion.
How should parents inoculate their children against wrong ideas without setting up straw men or caricatures? Always look for the very best arguments on the other side. That also works in college: Kids should learn to ask professors, “What would be the best argument I could go read against what you’ve just told me?” They never know the answer to this question—but that’s what intellectual honesty requires. Imagine a jury in a trial that only heard the prosecution but didn’t hear the defense.
That’s often how we are intellectually. We might know the defense or the prosecution, but we don’t know both. So we want to know the best arguments on both sides, and then frame our own arguments in light of the best objections on the other side.