Two Cheers for the Free Market

Two Cheers for the Free Market

Shortly after coming home from one of our trips to mainland China, I read a report by an ecumenical group about economic issues.  It featured a rather unnuanced condemnation of “the global market.” It struck me that the Christians I had just been with in China would have found that critique ludicrous. The market system had been working wonders in their country, and the results had been quite visible to us. Only a few years before much of what we saw in China had been drab and depressing. Now, however, things were vibrant and colorful. More importantly, economic freedom was bringing with it  more religious freedom, and even signs of new political liberties.

Not that things are perfect in China. With the free market has come new manifestations of human sin, both individual and collective. But it is difficult to deny—when looking at conditions in China up close—that capitalism has brought many blessings to the Chinese people.

It made me wonder what was going on in the minds of the theologians and church leaders who  had issued the document that I read. These are the kinds of folks who often accuse those of us in the evangelical world of lusting after simplistic perspectives on complex issues in the human condition. Yet what they said about economics was sheer naitvete.

Nor am I judging that kind of perspective on the basis of one document—the naivete shows up often. A few years ago at a gathering of theological educators, for example, a scholar from a well-known liberal seminary provided us with a rant on the evils of capitalism.  He concluded with this prophetic word: “We need to break the grip that the global market has on theological education.” He was asked how he thought theological schools like his would support themselves if they refused to profit from the market system. The answer, he said, was to find alternative sources of funding. Again, a question was posed: And where would we find those sources of funding? His answer—I kid you not!—was that we should form partnerships with organizations like Amnesty International.

Now, I have great respect for Amnesty International.  I have even sent them money on occasion. And that makes my point. Amnesty International is itself dependent upon the good will of people who have benefited from the free market system.

In 1978 Irving Kristol published a fascinating book, Two Cheers for Capitalism. In that book, Kristol—who died recently—made the case that “bourgeois capitalism” has two important things going for it. One is that it succeeds in making life better, in material terms, for many people. The other is that it fosters a significant degree of personal liberty. Those are precisely what we are seeing in China as a result of the introduction of capitalism.

Kristol was not, however, uncritical of the market system. He also saw it imposing a signficant “psychic burden” on people. There are fundamental human needs that cannot be met by a consumerist culture—and because we tend to look for material remedies for our spiritual  ills,  we experience a “spiritual malaise” that can easily undo us.

Kristol later argued that it was precisely the recognition  that capitalism fails to deserve a third cheer that is a mark of the “neo-conservative” perspective of which he was seen as a major proponent. I’m not ready to line up with the “neo-cons” on all of their points, but on this matter I believe Kristol had it right. The problem is not with the market system as such. Indeed, there is much to cheer about as we think about what it contributes to human life.

I have been told by Chinese academics that one of the books being read by scholars in China these days is Max Weber’s classic, The Protestant Ethic and the Spirit of Capitalism. I am glad that Weber is being read in China. In that pioneering work, Weber argued that capitalism functions best when it is undergirded by such qualities as honesty, thrift, a commitment to hard work, a sense of calling, a charitable spirit, a commitment to the common good, and the like. Whether all of that is uniquely “Protestant” has been much debated. But that it comprises a necessary moral-cultural infrastructure for sustaining a healthy free market seems to me undebatable.

The global market must not be viewed in messianic terms. It functions properly when it draws on virtues and worldviews that it  cannot generate on its own. It fails us when we look to it to solve all of our needs. We need to resist its lure when it makes promises beyond its capacity to fulfill. Then it does become a false gospel.  And it also fails us when it withholds its benefits from those who are genuinely needy. What we Christians need to be thinking much  about these days is how the free market system can be undergirded by the promises and hopes—including the yearning for justice— that can only be met by the true Gospel.


  1. Jay Richards recently wrote an article for Houston Baptist University’s quarterly “The City” winter 2009 entitled “Christianity and Capitalism” A very excellent article in which he points out that the idea of self interest must not be equated with selfishness. We all, even Christians, may properly look after our own self interests, i.e. brushing our teeth, taking our vitamins, etc. Additionally the entrepeneur is the opposite of the miser, the selfish hoarder. The entrepeneur spends his money (and other’s!) for a future benefit. His benefit, of course, but in so doing the entrepeneur must, to some degree, be other oriented. He/she must think enough about the other person’s needs / wants so that they can create a product / service that they would freely buy. The Bible has a lot to say about misers / hoarders, and this is different from an entrepeneur. Mr. Richards tackles head on a number of myths about captilalism quite well, I think. He is a visiting fellow at The Heritage Foundation, which will automatically disqualify him, I suppose, in the eyes of a certain segment of the population.

    Comment by Mike Cheek — February 23, 2010 @ 11:27 am

  2. Lord Rabbi Jonathan Sacks wrote an excellent article in First Things entitled “Markets and Morals” that deals with the reason why capitalism doesn’t get that third cheer. Those interested can read it at

    Sacks contrasts the “this-worldliness” of Judaism with the “other-worldliness” of Christianity. He then discusses five features of Jewish life that oppose the market ethic, and, if observed, keep it from being viewed in messianic terms:

    1) Sabbath
    2) Marriage and family
    3) education
    4)the concept of property
    5) the Law

    “Socialism is not the only enemy of the market economy. Another enemy, all the more powerful for its recent global triumph, is the market economy itself. When everything that matters can be bought and sold, when commitments can be broken because they are no longer to our advantage, when shopping becomes salvation and advertising slogans become our litany, when our worth is measured by how much we earn and spend, then the market is destroying the very virtues on which in the long run it depends. That, not the return of socialism, is the danger that advanced economies now face. And in these times, when markets seem to hold out the promise of uninterrupted growth in our satisfaction of desires, the voice of our great religious traditions needs to be heard, warning us of the gods that devour their own children, and of the temples that stand today as relics of civilizations that once seemed invincible.”

    Sacks wrote this a decade ago, when the Market was idolized and Alan Greenspan was its Prophet. Perhaps our current economic recession is God’s way of reminding us He alone is God.

    Comment by Beth — February 23, 2010 @ 11:45 am

  3. Very well stated.

    It’s unfortunate to see so many clergy, lay people, and even theologians jumping onto the “capitalism is evil” bandwagon. If we are honestly committed to the Gospel, church leaders should avoid the polarized rhetoric of America’s political landscape, and instead seek to engage topics of social justice with open minds.

    At the same time, I’m hesitant to join you cheering for the Free Market, if merely because the phrase itself has been co-opted primarily by economic extremists arguing against anything that implies government intervention.

    Don’t misunderstand me: Markets are great ways to exchange goods and services, especially when we use fiat money to aid the process. But even Adam Smith (the intellectual father of the Free Market) argued that society needed government to deter corruption, prevent monopoly, and build infrastructure for the social welfare of a nation.

    In many ways, Capitalism has made China a better place. But let’s hope that you are right, and that with their new found wealth, the spread of the Gospel will move China to act on behalf of the poor and oppressed.

    Comment by Caleb — February 23, 2010 @ 8:04 pm

  4. China will rise and fall according to the degree of their investment in the “Image of a capital economy”. When did capital simply equate to money anyway. China is slowly beginning the climb into the resource drain on resource rich countries and nations. Think about the shark industry. I also find it hard to believe that all of China is really thriving. Is anyone asking the important questions about how wealth is created? Is there a difference between real wealth and market based phantom wealth, which by it’s very nature is exclusive?
    I love the mention of Jonathan Sacks and his synopsis of the ‘enemy of the market is the market itself.’ Also, there is a difference between a true “free market” and capitalism, because of corporate “bondage trade” (I just made up that term). Corporate interests hate the free market, because isn’t it supposed to diminish the hyper-inflated price of goods? Also, if people read Max Weber, why are they not coming to the conclusion that as individual vocations post-industrial revolution became the ministries of Christians, it minimized the importance of the church. I hope China doesn’t follow the example of the U.S.
    BTW–I love everything Dr. Mouw writes. :)

    Comment by Paul — March 5, 2010 @ 11:56 am

  5. Dr. Mouw, would you please define what you mean by “the market system” and “the free market” and “capitalism”?

    You are aware, I assume, that certain free market economists consider it quite an absurd opinion that there is a genuinely free market system globally, in the U.S., or elsewhere.

    If you are identifying the current economic “system” in operation today, these same free market economists argue that this current system is indeed “as such” a serious problem (exactly because it is not a free market).

    Comment by Baus — March 9, 2010 @ 1:22 am