by Ashutosh Jogalekar
Religion has always had an uneasy relationship with money-making. A lot of religions, at least in principle, are about charity and self-improvement. Money does not directly figure in seeking either of these goals. Yet one has to contend with the stark fact that over the last 500 years or so, Europe and the United States in particular acquired wealth and enabled a rise in people’s standard of living to an extent that was unprecedented in human history. And during the same period, while religiosity in these countries varied there is no doubt, especially in Europe, that religion played a role in people’s everyday lives whose centrality would be hard to imagine today. Could the rise of religion in first Europe and then the United States somehow be connected with the rise of money and especially the free-market system that has brought not just prosperity but freedom to so many of these nations’ citizens? Benjamin Friedman who is a professor of political economy at Harvard explores this fascinating connection in his book “Religion and the Rise of Capitalism”. The book is a masterclass on understanding the improbable links between the most secular country in the world and the most economically developed one.
Friedman’s account starts with Adam Smith, the father of capitalism, whose “The Wealth of Nations” is one of the most important books in history. But the theme of the book really starts, as many such themes must, with The Fall. When Adam and Eve sinned, they were cast out from the Garden of Eden and they and their offspring were consigned to a life of hardship. As punishment for their deeds, all women were to deal with the pain of childbearing while all men were to deal with the pain of backbreaking manual labor – “In the sweat of thy face shalt thou eat bread, till thou return unto the ground”, God told Adam. Ever since Christianity took root in the Roman Empire and then in the rest of Europe, the Fall has been a defining lens through which Christians thought about their purpose in life and their fate in death.
For the longest time after the Roman Empire collapsed, human beings engaged in toil on their farms and feudal estates without an appreciation of anything resembling what we today call the national or global economy. There was also a great deal of inequality built into this system, with landlords squeezing their serfs for all they were worth and the serfs having very little bargaining power. It was not just an unfair system but also an inefficient one, certainly for the serfs but also ironically for the landlords who were not always getting access to the best labor. It’s also very hard for us today to appreciate how much of a role religion played in people’s lives then. Essentially every aspect of their existence, every transaction they made, every small task they did, was somehow justified or frowned upon by something said in the Bible. If you wanted guidance on how to do an economic transaction, you would just as easily go to your priest as to anyone else. The basic understanding that people had of their lot in life was that if it was wretched or blessed, it must be because God had foreordained it.
The Protestant Reformation started by Martin Luther in 1517 changed everything profoundly. There were two important developments that Luther ignited. One was a movement against the Church. The other was his translation of the Bible into German and insistence that ordinary people read it so that they can have a personal relationship with God that is unconstrained by the whims of priests in Rome. The Reformation made literacy rates in Europe spike; there is plausible evidence that as you moved away from Wittenberg where Luther lived and preached, literacy rates correlated with whether a region was Protestant or Catholic. This religious rift between Protestants and Catholics led to centuries of religious wars in Europe in which millions of lives were lost and the countryside decimated. It also led to economic depressions from loss of material goods and the labor force.
Luther’s revolution led to an unexpected meld between religion and economics via two significant avenues. One was the second Protestant revolution started by John Calvin in Geneva. Calvinism spread like wildfire throughout Europe and particularly in England, where it fell on fertile soil just as Henry VIII was engineering a momentous break with the Catholic Church. The next few decades saw the English monarchy playing ping pong with Catholics and Protestants; starting with Mary Stuart and ending with James II and the Glorious Revolution, the Anglican Church finally became established as the mainstream church in England. A momentous impact of these developments was the migration of Puritans who were persecuted under James I and Charles I to New England. But an even more significant development, and one that was to have an unexpected impact on economics and religion, was brewing under the surface.
In the 16th and 17th centuries, a group of thinkers including Francis Bacon, Galileo Galilei, Isaac Newton, Robert Boyle, Robert Hooke, Christiaan Huygens, Gottfried Leibniz and others started what was the single most important transformation in the history of human thought – the scientific revolution. They showed us that the world around us can be understood – and improved – by doing experiments and calculations. Mathematics was found to be the language in which nature speaks. But the philosophical impact of the scientific revolution was even bigger than its specific elements. The revolution brought a mechanistic way of thinking to the forefront. Human beings were now thought to be marvelous levers in a great clockwork universe engineered by God. It’s worth noting that almost all of these early scientists – or natural philosophers as they were called back then – were devout men of religion. Some were deists who believed that God has set the machine into motion and then stepped away from its actual workings; others believed that God continues to actively intervene. But all of them saw no conflict between their worldview of science and religion.
This mechanistic worldview was very much in the air as the scientific revolution spread to Scotland. Its beneficiary was a Scotsman who probably deserves credit for lifting more people out of poverty than anyone in human history, all through a single work of genius. Adam Smith grew up steeped in an education that included both a history of Europe’s religious wars and the mechanistic, Newtonian worldview. With his friend David Hume who was much more skeptical of religion than him, he wanted to see how Newton’s universe could be applied to human transactions. The result was his seminal book, “The Wealth of Nations”, in which he carefully laid out how society could benefit entirely and unexpectedly from human beings acting in their self-interest. Most importantly, while French thinkers before Smith like Nicole and Mandeville had also explored this relationship (Mandeville citing a very charming example of a beehive), Smith actually provided a mechanism, that of the market, competition and specialization. But “The Wealth of Nations” along with Smith’s earlier “The Theory of Moral Sentiments” also hinted at how competition, self-interest and the resulting societal benefits made economic transactions not just practical but also moral. Smith’s opinion was that God has given each person a desire to improve not just their own lot but that of others (in his book Smith called this desire “sympathies”). Smith’s thinking galvanized economics in Europe and spread across the Atlantic. Prophetically, his book came out four months before the Declaration of Independence was written and the American Revolution began.
But Smith’s contributions still had to overcome the harsh constraints of Calvinist thinking. When the Puritans migrated to New England in 1630 to escape religious persecution, they brought with them a brand of religion that was almost as restrictive as what they were trying to escape. The essence of Calvinism that dictated both theory and practice in the New England settlements was predestination. Predestination refers to the belief that God has already decided who will go to heaven and who to hell. It also tells us that because of Adam’s original fall, all have sinned. The predestinarian doctrines were preached with great force by preachers like George Whitefield and Jonathan Edwards in the religious revivals of the mid 18th century. Predestination was a depressing and fatalistic idea – if God has already decided where you will be in the afterlife, what could you do to change this? But, goaded by the Enlightenment, predestinarian Calvinist thinking ran up against the idea of human agency. John Locke – who along with Voltaire and Newton, was one of Thomas Jefferson’s heroes – rejected the notion of sin dictated by Adam’s fall. Locke said that all men could not have been born in sin just because Adam sinned, simply because Adam never gave them his consent. Every human being thus starts their existence anew – in Locke’s famous phrase, as a tabula rasa or blank slate – which means that everyone has the moral and practical agency to dictate their own destiny. Along with Locke, the 16th century Dutch theologian Jacobus Arminius had also rejected Calvinist predestination in tolerant Holland and his ideas were highly influential. Arminianism was the basis of Methodism which was to spread significantly in the United States two centuries later.
With the challenge to traditional Calvinism came the notion that “self-love” or self-interest were not antithetical to religion. This thinking was spread from the mid 18th century onwards in the United States by a number of theologians and political thinkers, including the founding fathers themselves who saw trade and economic transactions as key to growing a new nation. Calvinism was also diluted by the many other denominations including Baptist and Methodist that sprung up over the new few decades. Goaded by freedom of religion, just like the economic marketplace the United States developed a religious marketplace in which anyone was free to leave their church and join another should they find the tenets of their present church unpleasant. Not surprisingly, depressing Calvinist predestinarian doctrines of eternal damnation and hellfire started becoming unpopular. The new religious sects saw no conflict between religion and money-making. Echoing Adam Smith for instance, Francis Wayland, a Baptist who was president of Brown University said that the laws of demand and supply were an expression of God’s unity and protection. Theologians like him were going even beyond Smith who didn’t try to form explicit connections between religion and capitalism.
It was also fortuitous that this questioning of Calvinism and reaffirming of a harmonious relationship between Christianity and religion came just as the United States was explosively expanding to the West and the industrial revolution was moving capital and human labor away from rural to urban centers. Opportunities for “self-love” were becoming limitless, and for a young country which wanted to expand its frontiers while also expanding its religious diversity, disavowing self-interest for the sake of religious objections would have been, well, a sin. But as far as sins went, there was one original sin that the growing nation was steeped in, and that was slavery. The relationship between slavery and religion is at least as complex as that between capitalism and religion; slavery was both justified and opposed on Christian grounds. But a movement that saw self-interest and demand and supply as compatible with Christianity also could not escape the inconvenient fact that slavery, while multiplying labor, also kept true demand and supply and wages muted. It might be benefiting slave owners but it wasn’t benefiting society as a whole, a goal that theologians of the day were realizing more and more should be the proper goal of a Christian ethic. Not surprisingly, abolition and temperance movements soon started arguing against slavery both on religious as well as economic grounds.
By the end of the Civil War, the relationship between capitalism and religion was apparent. Henry Ward Beecher, perhaps the most famous (and soon to be infamous because of an affair) minister of his day, preached at Brooklyn’s Plymouth Church that was attended by New York City’s rich and famous. Beecher not only saw no conflict between making money and worshipping God, but he also had a view of income inequality that would be unpopular today. Beecher did not think inequality was a problem because in his mind, those who were poor or unsuccessful largely deserved their fate because of a lack of personal responsibility – echoing a curious throwback to Calvinist predestinarian thinking, it was what God had intended for them. But views such as Beecher’s changed as a series of economic depressions and labor strikes, along with photographs of the plight of the poor in city tenements, made clear how wretched a system of winner-take-all could be. This was the era of the robber barons, after all. Soon both ministers and educators like Washington Gladden and Walter Rauschenbusch started to preach what they called the “Social Gospel”, a gospel that taught Jesus’s original message of trying to love thy neighbor even when you are trying to love yourself. Many of these reformers taught at leading universities like Columbia and Dartmouth, facilitating the spread of their thinking in the new generation. Businessmen like Andrew Carnegie who also became great philanthropists further drove home how important it was for the rich to give back to society. The Sherman Antitrust Act of 1890 and Teddy Roosevelt’s crusade against big business turned into law what was previously the province of writers and preachers.
In the 20th century – the American Century – the United States emerged as the world’s foremost economic and technological power. American self-love reached its pinnacle under Calvin Coolidge who acknowledged a truth that had been evident for a long time – the business of America was business. The Depression put a dent in how well this business worked, even as World War 2 rescued it and put American economic growth on steroids. For most of this time the relationship between personal, religious and economic freedom had been taken for granted, but it suddenly became conspicuous as American faced a new foe which didn’t just stifle personal freedom but which didn’t even believe in God in the first place. Truman and Eisenhower both railed against the Soviet Union’s godlessness while a young student at Yale named William F. Buckley was putting the finishing touches on his book, “God and Man at Yale”, which among other things made a case for why economic success went hand in hand with social and religious conservatism. Because of the Soviet Union’s triple failures of personal, religion and economic freedom, it became easy for Americans to tie the regime’s economic failures to their lack of faith, concomitantly highlighting the same connection in the United States as a counterexample. Ronald Reagan probably exemplified this paradigm more than anyone else, appealing to religious conservatives and railing against the Evil Empire. As Friedman says, the whole idea was that communism was a different and failed economic system because it was a different religion.
Today many people in the United States like to joke that capitalism has become a religion. Freidman’s book demonstrates that there is more than a shred of truth in that remark. But today that relationship is very different from what it was before. One of the big present conundrums Friedman discusses in the book is why Americans have consistently started voting against their self-interests; voters in states which are the beneficiaries of Democratic social safety nets voting against Democrats for instance, or voters voting against the estate tax even when there is no chance of it ever impacting them. Current thinking is that this opposition to economic policies is rooted in cultural policies; for instance, Republican voters who vote to dismantle Democratic safety nets are actually voting against Democratic policies on immigration or gay marriage. Democrats also like to think that the success of Republican candidates in recent years has come from low-income, mostly white voters without a college education massively voting Republican. But Friedman is skeptical of this premise, and I find his questioning of the conventional wisdom refreshing. As he points out, contrary to belief, the percentage of low-income voters without a college degree who vote Republican has actually stayed fairly consistent between 50 and 60 percent in the last fifty years. In addition, the evidence seems to indicate that social issues matter more to highly educated voters than to less educated ones. So, what explains voting patterns?
In Friedman’s opinion, religion which has rarely been discussed as a vote driver should be put back on the table as an explanation. For instance, both in 2004 and 2016, the tendency of voters to vote Republican depended not so much on their incomes as on their religiosity; in 2016, among voters who attended church more than once a week for example, 61 percent of those with higher incomes voted for Trump. The importance of religious conviction also shows up in preferences for economic policies. Opposition to policies like higher taxes, more government and having the estate tax seems to be explained better by religion rather than incomes, and particularly by whether voters are evangelical Protestants. As Friedman’s history indicates, evangelical Protestants going back to the Puritans and Henry Ward Beecher are much more likely to believe that success in life is the result of individual effort and agency. This applies to both lower and higher income voters. Thus, it’s not surprising that they seem to oppose policies that involve government intervention, even when that intervention will help them. The centuries old opposition to Calvinist predestination is alive and kicking.
The major problem we face today is the same problem that people at the turn of the 19th century faced, with some having too much and some having too little. Opposition to communism in the 20th century cemented the importance of free enterprise, but we also must not go too far and forget the currents of religious thought that advocated taking care of those who are unfortunate. As the physicist Freeman Dyson once put it, we need a system that combines the best of both capitalism and socialism: big fortunes for risk-takers and winners and parental leave and social safety nets for the losers. Friedman’s book indicates that religious thinking provides a guideline to both actions.
Karl Marx famous called religion the “opiate of the masses”. Today we would like to believe that in especially countries like the United States, religiosity has gone down. Popular surveys do indicate this. And yet Marx was right about this one. We would like to believe that modern capitalism which has lifted so many out of poverty and made them prosper is a direct result of the great progress in rationality of the 17th and 18th centuries. That is undoubtedly true. But what is untrue is to believe that seemingly irrational religious faith had nothing to do with it. While we continue to be the children of the Enlightenment, somewhere deep inside, we remain in thrall to gods and spirits in a cave.