The Poverty of Nations E-Book

Barry Asmus

• Herausgeber: Crossway
• Kategorie: Religion und Spiritualität
• Sprache: Englisch

Seitenzahl: 674

Veröffentlichungsjahr: 2013

Beschreibung

The whole world has a stake in the war against poverty and leaders across the globe are looking for a permanent solution. That's why economist Barry Asmus and theologian Wayne Grudem have teamed up to outline a robust proposal for fighting poverty on a national level. These two experts believe the solution lies in a comprehensive development plan that integrates the principles of a free market system with the Bible's teachings on social ethics. Speaking to the importance of personal freedom, the rule of law, private property, moral virtue, and education, this book offers a clear path for promoting economic prosperity and safeguarding a country's long-term stability—a sustainable solution for a world looking for the way forward.

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“The Poverty of Nations shows what not only poor nations but also America itself must do to create jobs, opportunities, and a more rewarding and better future. This is a very good book!”

Pete du Pont, former U.S. Congressman and former Governor of Delaware

“The religious leaders of the world wonder why poor countries remain poor. Key figures from Billy Graham to Pope Francis and the Dalai Lama have often urged the rich of the world to care for the poor—but how to do it? How to organize government and business to ‘remember the poor’? Now, theologian Wayne Grudem and economist Barry Asmus bring forward a book to explain how free enterprise and, crucially, biblical teaching combine to illuminate the path to progress for the poor. Every legislator—every voter—needs to read this.”

Hugh Hewitt, nationally syndicated radio talk show host; Professor of Law, Chapman University

“This book will become a standard text that we will use to train every mission team we have in 196 countries. It should be required reading in every Christian college and seminary, by every relief and mission organization, and by every local church pastor.”

Rick Warren,New York Times #1 best-selling author, The Purpose Driven Life; Pastor, Saddleback Church

“Many excellent authors over the past dozen years have felt the elephant’s trunk, legs, and tail. Wayne Grudem and Barry Asmus are the first to show the whole behemoth. They explain clearly and simply what we must know to love truly those in need. The Poverty of Nations should be required reading at every Christian college.”

Marvin Olasky, Editor-in-chief, World News Group; author, The Tragedy of American Compassion

“The authors have written clearly that the sustainable solution to the poverty of nations is the free-market system—the most moral and successful economic arrangement and the only one capable of enabling people to produce their way out of poverty and to personal well-being.”

Jon Kyl, former US Senator (Arizona)

“Grudem and Asmus show how the science of economics can be combined with a morality rooted in religious belief to help us understand why some nations are rich and others poor.”

John C. Goodman, President and CEO, National Center for Policy Analysis

“The grinding poverty of hundreds of millions of people made in God’s image ought to be of deep concern to every believer. Most Christians I know are generous to the poor without really thinking about the causes of poverty. This vital contribution from Wayne Grudem and Barry Asmus will help us think theologically about poverty. May it inform our prayers, giving, and actions.”

Andrew Evans, Minister, Christ Church, Liverpool; Tutor, Wales Evangelical School of Theology

“Relying upon a thoughtful combination of objective economic history, a clear understanding of human nature, accurate economic analysis, and a moral code based on personal freedom and the pursuit of happiness, the authors delve into means for alleviating the poverty of nations. The writing style is highly approachable and draws the reader into a realm of ideas that envisions hope for the downtrodden if government authority is properly exercised. Like The Wealth of Nations, it demands the attention of good-hearted citizens and hardened government officials to appreciate free markets in their moral light.”

Stephen Happel, Emeritus Professor of Economics, W. P. Carey School of Business, Arizona State University

“There are not many Christian books on this subject. Even less those that integrate a Christian worldview with economic systems, free markets, freedom, and prosperity, besides poverty. Grudem and Asmus offer a thorough analysis of several economic systems that went wrong and offer a plausible defense of the biblical basis for the free-market solution and how it could change a nation. There may be some question as to whether such a system would work for Latin American countries. But because of the underlying biblical principles, this book should be translated and studied in other parts of the world besides America. It will help Christians engage the social, economic, and political issues of today in a more significant and effective way.”

Rev. Augustus Nicodemus Lopes, Vice President, Presbyterian Church of Brazil

“Economics is too important to leave to economists alone. Theology, likewise, is too important to be left to theologians alone. This book, written for non-specialists by an economist and a theologian, must therefore be taken seriously and used to stimulate debate and action that will address the scourge of poverty.”

Peter S. Heslam, Director, Entrepreneurial Leadership Initiative, University of Oxford; Senior Member, Trinity College, Cambridge

“Grudem and Asmus provide a comprehensive set of principles for reducing poverty around the world. Seldom does one find such a complete and thoughtful integration of sound economics with good theology. The Poverty of Nations is strongly recommended for anyone concerned with world poverty.” 

P. J. Hill, Professor of Economics Emeritus, Wheaton College; Senior Fellow, Property and Environmental Research Center, Bozeman, Montana

“For the longest time, in Christian circles certainly, the crisis of poverty has deserved a thorough and practical response. Comprehensive in scope and practical in style, this book offers insights that cannot be taken lightly.”

Mutava Musimi, former member of Parliament, Kenya National Assembly

“There are many secular books on poverty, and there are many books on the Christian response to poverty. But Wayne Grudem, a theologian, and Barry Asmus, an economist, have done something far less common and far more valuable. They have successfully integrated Christian ethics and theology with sound economics. The result is a comprehensive and deeply satisfying synthesis. If you want to understand and help alleviate poverty, rather than merely supporting feel-good policies that may do more harm than good, you should read this book.”

Jay W. Richards, author, Money, Greed, and God, and co-author, Indivisible; Visiting Scholar, Institute for Faith, Work, and Economics; Senior Fellow, Discovery Institute

“Given the plethora of myths and misconceptions that so many people hold with regard to the importance of a free economy, its moral foundation, and its practical benefits, especially for the poor, The Poverty of Nations provides an easy-to-read, sensibly organized, and morally clear argument on behalf of a free society. Merely reading the table of contents will provide clearer thinking than many graduate students get in economics courses.”

Fr. Robert A. Sirico, President, Acton Institute; author, Defending the Free Market

“All right-thinking Christians are deeply concerned about the seemingly intractable problems of global poverty and inequality. Many view free-market economics as the cause of the problem rather than the solution, and assume with the best of intentions that aid, debt cancellation, wealth redistribution, environmentalism, and trade protectionism are what is needed. Wayne Grudem and Barry Asmus provide a compelling account of how nations can alleviate their poverty by means of development, increasing the production of goods and services, within a free-market model that guarantees the right to property and personal freedoms. This clear and accessible book is grounded in solid economic theory, historical analysis, and, above all, faithful biblical exegesis. The result is not a call for untrammelled capitalism, but for responsible development shaped by core cultural values that lie close to the heart of the Christian faith. Not everyone will agree with their approach, but anyone concerned to help those affected by poverty in our world will have to take their arguments seriously.”

Rev. John Stevens, National Director, Fellowship of Independent Evangelical Churches; former Deputy Head of School, Senior Lecturer in Property Law, and Senior Honorary Research Fellow, University of Birmingham, UK

“I became an economist because I fell in love with the idea that a nation’s choices could determine whether citizens faced wealth or poverty. Thirty years of research has led me to believe that wealth comes from a choice to support freedom and limited government. I became a Christian because I fell in love with Jesus Christ. The Bible says we were created in God’s image and that while we should love our neighbor, we are also meant to be creators ourselves. I never thought these were mutually exclusive beliefs. In fact, I believe biblical truth and free markets go hand in hand. I have searched far and wide for a book that melds these two worldviews. Asmus and Grudem have done it! A top-flight economist and a renowned theologian have put together a bullet-proof antidote to poverty. It’s a tour de force. The church and the state will find in this book a recipe for true, loving, and lasting justice.”

Brian S. Wesbury, Chief Economist, First Trust Advisors LP; former Chief Economist, Joint Economic Committee of the U.S. Congress

The Poverty of Nations: A Sustainable Solution

Copyright © 2013 by Wayne Grudem and Barry Asmus

Published by Crossway

1300 Crescent Street Wheaton, Illinois 60187

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form by any means, electronic, mechanical, photocopy, recording, or otherwise, without the prior permission of the publisher, except as provided for by USA copyright law.

Cover design: Faceout Studio, www.faceoutstudio.com

Cover image: Luke Shuman

First printing 2013

Printed in the United States of America

Unless otherwise indicated, Scripture quotations are from the ESV® Bible (The Holy Bible, English Standard Version®), copyright © 2001 by Crossway, a publishing ministry of Good News Publishers. 2011 Text Edition. Used by permission. All rights reserved.

Scripture quotations marked NET are from the NET Bible® copyright © 1996–2006 by Biblical Studies Press, L.L.C. www.bible.org. All rights reserved. Quoted by permission.

All emphases in Scripture quotations have been added by the authors.

The photograph and figures following page 192 are used with the permission of:

Photograph 1: Landiscor Aerial Information.

Figure 1: The Heritage Foundation. Reprinted from 2012 Index of Economic Freedom, ed. Terry Miller, Kim R. Holmes, and Edwin Feulner (Washington: Heritage Foundation, and New York: The Wall Street Journal, 2012), 24.

Figure 2: Transparency International. Reprinted from the Corruption Perceptions Index 2011, copyright 2011 by Transparency International, http://www.transparency.org/cpi2011/results/.

Figure 3: The Cato Institute. Reprinted from Stephen Moore and Julian Simon, It’s Getting Better All the Time: Greatest Trends of the Last 100 Years (Washington: Cato Institute, 2000).

Trade paperback ISBN: 978-1-4335-3911-4 Mobipocket ISBN: 978-1-4335-3913-8 PDF ISBN: 978-1-4335-3912-1 ePub ISBN: 978-1-4335-3914-5

Library of Congress Cataloging-in-Publication Data

Grudem, Wayne A.

The poverty of nations: a sustainable solution / Wayne Grudem and Barry Asmus.

1 online resource

Includes bibliographical references and index.

Description based on print version record and CIP data provided by publisher; resource not viewed.

Trade paperback ISBN: 978-1-4335-3911-4 Mobipocket ISBN: 978-1-4335-3913-8 PDF ISBN: 978-1-4335-3912-1 ePub ISBN: 978-1-4335-3914-5

1. Church work with the poor—Developing countries.

2. Poverty—Religious aspects—Christianity. 3. Economic development—Religious aspects—Christianity. 4. Developing countries—Economic conditions. 5. Sustainable development—Religious aspects—Christianity. I. Title.

BV639.P6

261.8'325—dc232013007190

Crossway is a publishing ministry of Good News Publishers.

To Bret Edson and Brad Edson, who believed in and supported this project from the beginning

Contents

Foreword by Rick WarrenPrefaceIntroduction1The GoalProduce More Goods and Services2Wrong Goals Approaches That Will Not Lead to Prosperity3Wrong Systems Economic Systems That Did Not Lead to Prosperity4The Economic System The Free Market5The Mechanics of the System How Does a Free Market Work?6The Moral Advantages of the System A Free Market Best Promotes Moral Virtues7The Government of the System Leaders Who Use Their Power for the Benefit of the People as a Whole8The Freedoms of the System Essential Liberties for Economic Growth9The Values of the System Cultural Beliefs That Will Encourage Economic GrowthAppendix:A Composite List of Factors That Will Enable a Nation to Overcome Poverty

DETAILED CONTENTS

Foreword by Rick Warren

Preface

Introduction

A.  

National focus

B.

Steps from within a nation

C.

Not a simple solution

D.

Written for ordinary readers, not economists

E.

Written to leaders, especially Christian leaders, but also those who are not Christians

F.

Written for students

G.

Why don’t economists agree on a solution to poverty?

H.

Why should we help the poor?

I.

The responsibility of leaders

J.

Material prosperity is a secondary issue

Chapter 1. The Goal: Produce More Goods and Services

A.  

What makes a country rich or poor?

1.

The standard measure of wealth and poverty: per capita income

2.

The standard measure of what a country produces: gross domestic product (GDP)

3.

What will increase a country’s GDP?

B.

Other goals that have been suggested

C.

The amazing process of creating value that did not exist before

1.

Examples of the creation of products of value

2.

Transfers of goods from one person to another do not increase GDP

3.

Printing money does not increase GDP

4.

How can a nation create more goods and services?

D.

Examples of nations that have become prosperous by producing more goods and services

1.

Britain: cotton manufacturing and the Industrial Revolution

2.

Nations that have grown more prosperous today

E.

Biblical support for creating more goods and services

F.

What goods and services can your country create?

Chapter 2. Wrong Goals: Approaches That Will Not Lead to Prosperity

A.  

Dependence on donations from other nations

1.

The harmful results of dependence on foreign aid

2.

The reasons foreign aid is harmful

3.

Biblical teaching about dependence on donations from others

4.

“Earned success” is more important than money

B.

Redistribution of wealth from the rich to the poor

1.

In some nations, people are rich because of abuse of government power

2.

In other nations, people are rich because they have rightfully worked and earned more money

C.

Depletion of natural resources

D.

Blaming poverty on outside factors or entities

1.

Colonialism

2.

Agencies that lend money to poor countries

3.

The world economic system and international terms of trade

4.

Rich nations and multinational corporations

E.

Conclusion: what the goal is not

Chapter 3. Wrong Systems: Economic Systems That Did Not Lead to Prosperity

A.  

Hunting and gathering

B.

Subsistence farming

C.

Slavery

D.

Tribal ownership

E.

Feudalism

F.

Mercantilism

G.

Socialism and communism

H.

The welfare state and equality

I.

A better solution: the free-market system

Chapter 4. The Economic System: The Free Market

A.  

The free-market system defined

1.

Definition

2.

The rule of law

3.

Are all economies “mixed”?

4.

Are we really talking about capitalism?

5.

The economic success of free-market systems

6.

Biblical support for human freedom in economic systems

B.

The wonder of a pencil: the free market, without a human director, makes complex products that no one knows how to make

C.

The economic foundation of a free market: private ownership of property

1.

The justification of private property from the Bible

2.

Private property implies an obligation for responsible stewardship

3.

Governments both violate biblical principles and hinder economic development when they prevent people from owning property

4.

Historical evidence of the economic damage that occurs when governments prevent private ownership of property

5.

The importance of legal titles to property

6.

Government rules that make property ownership impossible

7.

Establishing an easy path to documented property ownership

D.

The legal foundation for a free market: the rule of law

E.

Two crucial economic factors for a free market

1.

The government must establish a stable currency

2.

The government must maintain relatively low tax rates

F.

TwoDoes your country have a free-market system?

Chapter 5. The Mechanics of the System: How Does a Free Market Work?

A.  

“No one” decides what, how, and for whom a national economy will produce

B.

Specialization is the key to greater prosperity

1.

The benefits of specialization

2.

Specialization works because everyone has some comparative advantage

3.

Specialization in a nation changes over time

C.

The remarkable signaling system of the free market

D.

Prices are an amazing worldwide source of instant economic information

E.

Profits and losses are the green and red lights of the system, by which customers signal “go” or “stop”

F.

Competition leads to interpersonal cooperation, better products, more choices, and lower prices

G.

Entrepreneurship: many try, few succeed, but all of society benefits

H.

Summary of how a free-market system functions

I.

How wealthy people in rich nations can genuinely help poor nations

Chapter 6. The Moral Advantages of the System: A Free Market Best Promotes Moral Virtues

A.  

Promoting personal freedom

1.

Promoting freedom of choice for moral actions

2.

Promoting freedom for abstract or spiritual pursuits

B.

Promoting personal virtues

3.

Promoting personal integrity and truth-telling

4.

Promoting accountability

5.

Promoting earned success

6.

Moderating selfishness and greed, and using them for good

7.

Promoting wise use of the environment

8.

Curbing materialism and promoting personal charity

C.

Promoting interpersonal virtues

9.

Meeting the needs of others

10.

Prioritizing the wants of others

11.

Treating others humanely

12.

Truly helping the poor

13.

Promoting “lesser virtues” such as punctuality, courtesy, tidiness, and a job well done

D.

Promoting societal virtues

14.

Promoting a peaceful and harmonious society

15.

Promoting a fair society

16.

Promoting a productive society

E.

Moral objections

1.

Objection: free markets do not work

2.

Objection: free markets depend on greed

3.

Objection: free markets result in inequality

4.

Objection: in some countries, free markets become “bad capitalism”

5.

Objection: we don’t need more “stuff”

Chapter 7. The Government of the System: Leaders Who Use Their Power for the Benefit of the People as a Whole

A.  

Protections against corruption in the government

1.

Rule of law: all people are equally accountable to the laws

2.

Fair court system: courts show no favoritism or bias, but enforce justice impartially

3.

Absence of bribery and corruption in government offices

4.

Adequate power of government

5.

Limited power of government

6.

Separation of powers in government

7.

Government accountability to the people

B.

Protections government should provide

8.

Protection against crime

9.

Protection against disease

10.

Protection against violations of contracts

11.

Protection against violations of patents and copyrights

12.

Protection against foreign invasion

13.

Avoidance of wars of conquest and civil wars

14.

Protection against destruction of the environment

C.

Things government should promote

15.

Compulsory universal education

16.

Laws that give protection and positive economic incentives to stable family structures

17.

Laws that protect freedom of religion for all religious groups and give some benefits to religions generally

D.

Conclusion

Chapter 8. The Freedoms of the System: Essential Liberties for Economic Growth

A.  

The importance of freedom for economic growth

B.

The types of freedom the government should protect

1.

Freedom to own property

2.

Freedom to buy and sell

3.

Freedom to travel and transport goods anywhere within the nation

4.

Freedom to relocate anywhere within the nation

5.

Freedom to trade with other nations

6.

Freedom to start businesses

7.

Freedom from excessive government regulation

8.

Freedom from demands for bribes

9.

Freedom for a person to work in any job

10.

Freedom for workers to be rewarded for their work

11.

Freedom for employers to hire and fire

12.

Freedom for employers to hire and promote employees based on merit

13.

Freedom to utilize energy resources

14.

Freedom to change and modernize

15.

Freedom to access useful knowledge (freedom of information)

16.

Freedom for all people to be educated

17.

Freedom for women as well as men

18.

Freedom for people of all races and all national, religious, and ethnic origins

19.

Freedom to move upward in social and economic status

20.

Freedom to become wealthy by legal means

21.

Freedom of religion

C.

Conclusion

Chapter 9. The Values of the System: Cultural Beliefs That Will Encourage Economic Growth

A.  

Beliefs about religious matters

1.

The society believes that there is a God who holds all people accountable for their actions

2.

The society believes that God approves of several character traits related to work and productivity

B.

Beliefs about moral standards

3.

The society values truthfulness

4.

The society respects private ownership of property

5.

The society honors other moral values

C.

Beliefs about human nature

6.

The society believes that there are both good and evil in every human heart

7.

The society believes that individuals are responsible for their own actions

8.

The society highly values individual freedom

9.

The society opposes discrimination against people on the basis of race, gender, or religion

D.

Beliefs about the family

10.

The society honors marriage between one man and one woman

11.

The society values permanency of marriage and has a low divorce rate

E.

Beliefs about the earth

12.

The society believes that human beings are more important than all other creatures on the earth

13.

The society believes that the earth is here for the use and benefit of human beings

14.

The society believes that economic development is a good thing and shows the excellence of the earth

15.

The society believes that the earth’s resources will never be exhausted

16.

The society believes that the earth is orderly and subject to rational investigation

17.

The society believes that the earth is a place of opportunity

F.

Beliefs about time and change

18.

The society believes that time is linear, and therefore there is hope for improvement in the lives of human beings and nations

19.

The society believes that time is a valuable resource and should be used wisely

20.

The society manifests a widespread desire to improve on life—to do better, to innovate, and to become more productive

21.

The society is open to change, and the people therefore work to solve problems and make things better

G.

Beliefs about work and economic productivity

22.

The society honors productive work

23.

The society honors economically productive people, companies, inventions, and careers

24.

The society’s business owners and workers view their companies primarily as means of providing customers with things of value, for which they will then be paid according to that value

25.

The society manifests a widespread desire to improve on life—to do better, to innovate, and to become more productive

H.

Beliefs about buying and selling

26.

The society believes that mutual gains come from voluntary exchanges, and therefore a business deal is “good” if it brings benefits to both buyer and seller

I.

Beliefs about knowledge and education

27.

The society values knowledge from any source and makes it widely available

28.

The society values a highly trained workforce

29.

The society assumes that there must be a rational basis for knowledge and recognized channels for spreading and testing knowledge

J.

Beliefs about humility and the value of learning from others

30.

The society demonstrates a humble willingness to learn from other people, other nations, and members of other religions

K.

Beliefs about government

31.

The society believes that the purpose of government is to serve the nation and bring benefit to the people as a whole

32.

The society believes that government should punish evil and promote good

L.

Beliefs about the nation itself

33.

The society values patriotism and reinforces a shared sense of national identity and purpose

M.

Beliefs about economic, relational, and spiritual values

34.

The society counts family, friends, and joy in life as more important than material wealth

35.

The society counts spiritual well-being and a relationship with God as more important than material wealth

N.

Conclusion

Appendix: A Composite List of Factors That Will Enable a Nation to Overcome Poverty

Bibliography

FOREWORD

By Rick Warren

There are more than two thousand verses about the poor and poverty in the Bible, yet most evangelical pulpits are strangely silent on a subject that God cares about so deeply. I’m both shocked and saddened to admit that although I attended a Christian college and two seminaries, I cannot recall ever hearing a single message about God’s plan for the poor, except that we ought to be personally generous with them. Unfortunately, due to this shortage of clear, biblical teaching on economics, many believers have, without thinking, subscribed to the most common unbiblical approaches to poverty, economic justice, and wealth.

The results have been devastating. Today, more than half of the people in our world live on less than $2 each per day, and one billion people are mired in extreme poverty, living on less than $1 each per day. In a world that God created with a superabundance of resources, the fact that so many live in poverty is not only inexcusable, it is sinful, and we Christians need to repent. The solution lies with neither Marx nor the market, but in the words of the Master.

Big government is certainly not the solution. In many countries, it has made the problems worse. Unfortunately, so have many well-meaning, but misguided, Christian humanitarian programs. Having traveled the globe for thirty years and trained leaders in 164 countries, I’ve witnessed firsthand that almost every government and NGO (non-profit) poverty program is actually harmful to the poor, hurting them in the long run rather than helping them. The typical poverty program creates dependency, robs people of dignity, stifles initiative, and can foster a “What have you done for me lately?” sense of entitlement.

The biblical way to help people rise out of poverty is through wealth creation, not wealth redistribution. For lasting results, we must offer the poor a hand up, not merely a handout. You spell long-term poverty reduction “j-o-b-s.” Training and tools liberate people. Trade, not aid, builds the prosperity of nations.

I’ve been waiting for a book like this for a long time. Wayne Grudem and Barry Asmus have brilliantly written a work that is at the same time completely biblical, historical, and practical. Every so often, a book is written that you know will become a classic. The Poverty of Nations is such a book. It should be required reading in every Christian college and seminary, by every relief and mission organization, and by every local church pastor. At Saddleback Church, and in all churches participating in the P.E.A.C.E. Plan, this book will become a standard text that we will use to train every mission team we have in 196 countries.

Don’t just read this book. Study it! Reread it and make notes, then put it into practice and teach it to others. It could change the world.

Rick Warren Senior Pastor, Saddleback Church, Lake Forest, CaliforniaFounder, Global P.E.A.C.E. Plan

PREFACE

“Why is Africa so poor?” asked the woman from Kenya. “Are we under a curse?” She and her husband were successful business owners in Nairobi, but the continuing poverty in their nation troubled them deeply.

I (Wayne Grudem) had no answer. After a stunned silence, I had to say, “I’m sorry, I don’t know.” But the question continued to trouble me.

Eventually, I talked about it with my friend Barry Asmus, a professional economist. He had some helpful insight, but no complete answer. Then, as we continued to talk, we discovered that the two of us had a combination of academic resources that might enable us to find a much more complete answer and a solution.

One of us (Barry) is an economics professor with decades of experience in bringing economic analysis to national economic problems. The other (Wayne) is a theology professor with decades of experience in demonstrating how a detailed analysis of the teachings of the Bible can apply to modern-day real-life situations.

Our subsequent conversations led to a rewarding several-year project to combine the findings of modern economics with the teachings of the Bible in an attempt to solve the age-old problem of world poverty. We increasingly found that, despite our vastly different academic backgrounds, the conclusions from our two fields of study matched quite closely, giving the overall solution greater clarity and persuasiveness.

At first, we found just a handful of factors that will lead to prosperity or poverty in a nation. After more study, we had a list of thirty-seven factors. Further research and feedback from seminars in Albania and Peru added more factors, and we began to make presentations on “fifty factors within nations that will lead to wealth or poverty.” Finally, this book concludes with a composite list of seventy-eight distinct factors within nations that, we believe, will enable any poor nation to overcome poverty (see Appendix, here).

We are not aware of any other book like this, one that addresses poverty not at the personal or community level, but at the whole-nation level, and that proposes a solution based on a combination of conclusions from economics and theological ethics. We hope that readers will find the book both enlightening and persuasive.

Many people have helped us greatly in the production of this book. We appreciate the valuable comments and suggestions on earlier drafts or sections of this work from Scott Allen, Cal Beisner, John Coors, Ardian Fullani, Toni Gogu, Elliot Grudem, Stephen Happel, P. J. Hill, Ben Homan, John Kitchen, David Kotter, Ernst Lutz, Jeff Michler, Darrow Miller, Christopher Morgan, Severin Oman, Robb Provost, Nancy Roberts, Brad Routh, Rich Shields, Keith Wright, and another reader who prefers to remain unnamed. We received valuable feedback from participants in our seminars in Tirana, Albania; Lima, Peru; Eger, Hungary; Beijing, China; Cambridge, England; and Phoenix, Arizona, and from scholars at the annual meeting of the Evangelical Theological Society. We also appreciate the valuable suggestions and comments from the adult enrichment class at Scottsdale (Arizona) Bible Church, where we presented this material.

In addition, I (Wayne) wish to express appreciation to Potter-Brock Associates, who long ago supported my initial attempts to research the Bible’s teaching on economic issues; to the members of the board of Trinity Evangelical Divinity School, who several years ago approved a sabbatical research project on the Bible and economics; and to the members of the board of Phoenix Seminary, who approved a sabbatical term in the fall of 2003, during which I was able to study economics at Arizona State University under the excellent instruction of professors Stephen Happel and Nancy Roberts.

Teri Armijo, Jenny Miller, and Angela Yang cheerfully and skillfully typed various sections of the manuscript. Jenny Miller also helped with numerous tasks in the editing process, and Angela Yang helped extensively with research. Joshua Brooks, Jeff Phillips, and John Paul Stepanian also provided excellent research help. Jeff Phillips and John Paul Stepanian helped with proofreading and indexing the manuscript. We appreciate the skillful design help we received on the cover from Josh Dennis, Oliver Grudem, and Christopher Warrington. Greg Bailey at Crossway Books helped the manuscript significantly with his edi­torial skills.

We have dedicated this book to two friends, Bret and Brad Edson of Market­place One, who have firmly believed in this project from the beginning and have graciously supplied both office space and financial support to make this project possible. Their lives are a clear demonstration that committed Christians can work in the business world with integrity and create products and services that bring new economic value to an entire region of a country. They are now devoting their lives and resources so that more people in this nation and other nations can also experience the same kind of earned success.

Our deepest appreciation and gratitude goes to our wives, Margaret Grudem and Mandy Asmus, who have patiently supported, encouraged, and prayed for us as we worked month after month to complete this project. We love them greatly and they continue to bring great joy to our lives.

Wayne Grudem and Barry Asmus March 2013

Blessed is the one who considers the poor! In the day of trouble the LORD delivers him.

PSALM 41:1

INTRODUCTION

The goal of this book is to provide a sustainable solution to poverty in the poor nations of the world, a solution based on both economic history and the teachings of the Bible. We use the word sustainable because this solution addresses the long-term causes of poverty in nations. If those are changed to become long-term causes of prosperity, the solution will last.

Our solution does not claim that everyone can be equally well-off. Some people will always be richer than others, and therefore some will be (relatively) poorer. But the solution we propose explains practical steps that any poor nation can take. These steps will lead the nation out of the poverty trap and into a path of ever-increasing prosperity that will often lift almost everyone in the nation to a better standard of living. This solution will permanently open opportunities for even the very poor to gain increasing prosperity.

The solution we propose is not new. Many parts of it have already been put into practice in nation after nation over the last 240 years with amazing results. It can still bring remarkable results in every poor nation today.

At the outset, it is important that we state clearly what kind of book this is.

A. National focus

The title of our book is The Poverty of Nations because its focus is on the poor nation as a whole. We focus on national laws, national economic policies, and national cultural values and habits because we are convinced that the primary causes of poverty are factors that affect an entire nation. The solution we propose in this book must include changes in these national laws, policies, and cultural values and habits.

We do not discuss how to help individual poor people, businesses, or communities, because we understand our book as supplemental to those efforts. We recognize that charitable organizations, churches, and governments around the world are already helping individuals and communities, often in very effective ways. For example, our own church in Arizona, Scottsdale Bible Church, has carried out multiple programs to dig wells, provide medical and dental clinics, and build schools, in addition to supporting evangelism and Bible teaching in several nations.

We also applaud the success of microfinance projects in helping individuals in many countries, and we are thankful for thousands of other development projects that have brought access to clean water and sanitation systems, improved crop yields, promoted educational advancement, and made progress toward the eradication of diseases in many nations.

But in spite of all these efforts, it seems to us that something is still needed: a focus on the nationwide laws, policies, and cultural values and habits that determine so much of the course of economic development in a nation.

We recognize that other organizations and other writers have lifetimes of experience and far more wisdom than we have for helping individual poor people and communities. We especially appreciate the wisdom of many Christian charities, such as Food for the Hungry (located in the Phoenix area, where we live), which has as its stated mission “To walk with churches, leaders and families in overcoming all forms of human poverty by living in healthy relationships with God and His creation.”1 We also appreciate the whole-person, societal-transformation emphasis in programs such as the P.E.A.C.E. Plan instituted by Pastor Rick Warren, with its emphasis on church-to-church ministry. The acronym stands for: Plant churches that promote reconciliation, Equip servant leaders, Assist the poor, Care for the sick, and Educate the next generation.2 Many other such worthwhile programs could be mentioned.

Other writers have already provided excellent Christian perspectives on helping the poor. We commend especially When Helping Hurts: How to Alleviate Poverty Without Hurting the Poor and Yourself, by Steve Corbett and Brian Fikkert,3 which explains how to help the whole person while humbly learning and respecting local wisdom, and Discipling Nations: The Power of Truth to Transform Cultures, by Darrow Miller,4 which gives an extensive and insightful explanation of a Christian worldview particularly as it affects economic questions.

Our book is different in that it is aimed at the level of the whole nation. It is also different because it is co-authored by a professional economist (Barry Asmus) and a professor of theology (Wayne Grudem). Therefore, this book combines an economic analysis (based on the history of economic development for more than two hundred years) with a theological analysis (based on the teachings of the Bible about economic issues and government policies). From this dual perspective, we address entire national systems—first, types of economic systems (chaps. 3–6); second, government laws and policies (chaps. 7–8); and third, national cultural values and beliefs, including moral and spiritual convictions (chap. 9). We are not aware of any other book that approaches the question of world poverty at a national level from this combined perspective.

B. Steps from within a nation

The various steps we propose must be implemented from within a nation, by its own leaders. They are not steps that can be imposed by anyone outside the poor nation.

There is a great advantage to focusing on changes that must come from within a nation itself. This follows the sound counsel of Corbett and Fikkert in When Helping Hurts. Theyrecommend a good rule of thumb that cuts through much of the complexity of alleviating poverty: “Avoid Paternalism.” That is, do not do things for people that they can do for themselves. They say, “Memorize this, recite it under your breath all day long, and wear it like a garland around your neck . . . it can keep you from doing all sorts of harm.”5

Because we emphasize steps that a nation can take to help itself overcome poverty, we hope that our book will be a source of hope and encouragement for leaders in poor nations. Instead of telling such leaders, “You need to depend on people in other nations to solve your problem of poverty,” we are saying: “We believe that you can solve this problem yourselves, and here are helpful steps that other nations have taken in the past and that are supported by the teachings of the Bible as well. We believe that you can implement these steps in your own nation, and that when you do, they will bring many positive results.”

Other recent studies also emphasize that the solution to poverty in poor nations must come from within those nations. William Easterly, economics professor at New York University, who was for many years a senior research economist at the World Bank, explains that Western “Planners” cannot solve the problem of poverty in poor nations. He says: “A Planner believes outsiders know enough to impose solutions. A Searcher believes only insiders have enough knowledge to find solutions, and that most solutions must be homegrown.”6

Similarly, Oxford economics professor Paul Collier, who was formerly director of development research at the World Bank and is one of the world’s leading experts on African economies, writes:

Unfortunately, it is not just about giving these countries our money. . . . Change in the societies at the very bottom must come predominately from within; we cannot impose it on them. In all these societies there are struggles between brave people wanting to change and entrenched interests opposing it.7

However, Collier also says that the policies of rich nations can make a difference in the ability of poor nations to overcome their poverty. He writes, “Change is going to have to come from within the societies of the one billion, but our own policies could make these efforts likely to succeed, and so more likely to be undertaken.”8

We do not discuss such policy changes at length in this book (but see pages here and here on harmful trade policies). We recommend Collier’s book, with its insightful analysis of ways in which wealthy countries can do more to help the poorest countries of the world, especially the fifty-eight countries that he calls “the bottom billion” (the people in these countries comprise the poorest one billion people on the earth).

The policies of wealthy nations that Collier proposes to change include: (1) limited, targeted use of foreign aid (see here); (2) military intervention to maintain peace after conflicts and to protect against coups (see here); (3) the adoption by the wealthy nations of laws and charters to help catch and prosecute criminals from poor nations who deposit their money in those wealthy nations, including investment protections and insurance (see here); and (4) trade policies that use strategic decisions to lower trade barriers and give special help to extremely poor nations (see here). Collier speaks from decades of experience and outlines specific strategies in each of these four categories.

However, whether wealthy countries adopt such changes or not, the seventy-eight steps toward prosperity that we outline in this book still need to be pursued by poorer nations.

C. Not a simple solution

The solution that we propose is not a simple “quick fix,” one that says, “Just do this one thing and poverty will go away.” Our solution is a complex one made up of seventy-eight specific factors, as explained in the following chapters (see complete list in Appendix, here). These factors affect economic policies, governmental laws, and cultural values (including moral values and spiritual beliefs). Therefore, we are not proposing a simple approach such as “just give more money” (promoted by Jeffrey Sachs), or “just stop the foreign aid” (promoted by Dambisa Moyo). We are not even saying that the solution is “just establish a free-market economy” (though we do recommend a free-market system), because we point out multiple other legal and cultural factors that affect whether a free market actually functions effectively in a nation.

The solution we propose is complex because economic systems are complex. That is because economic systems are the result of millions of human beings making millions of choices every day. Who can ever expect to understand all of this?

In fact, writer Jay Richards explains why economics can be thought of as more complex than any other field of study:

In biology . . . we enter a higher order of complexity than in physics and chemistry. We are now dealing with organisms, which resist simple mathematical explanations. . . . From biology we move to the human sciences. Here the effects of intelligent agents appear everywhere. So it’s no surprise that it’s harder to use math to model human behavior than it is to use it to model, say, the movement of a ball rolling down a hill. By the time we reach economics, we are dealing not only with human agents, but with the complexity of the market exchanges of millions or billions of intelligent agents. As we go from physics at one end to economics at the other, we are moving up a “nested hierarchy” of complexity, in which higher orders constrain but cannot be reduced to lower orders.9

Therefore, it should not be surprising that the solution to poverty must be complex. This book discusses seventy-eight factors because all of them influence human decision making. Some of those factors are purely economic, but others have to do with laws, cultural values, moral convictions, long-term habits and traditions, and even spiritual values. Everything plays a part, so everything must be considered.

The fact that we have seventy-eight factors for a nation to consider might at first seem overwhelming. But there is another way of viewing this long list of factors. We hope that leaders in poor nations will approach the factors we discuss by asking, “What is our nation already doing well?” With so many factors, every nation will find it is strong in some areas.

This positive approach, starting by listing the areas in which a nation is strong, is consistent with what Corbett and Fikkert call “asset-based community development” (ABCD). They say:

ABCD puts the emphasis on what materially poor people already have and asks them to consider from the outset, “What is right with you? What gifts has God given you that you can use to improve your life and that of your neighbors? How can the individuals and organizations in your community work together to improve your community?” Instead of looking outside the low-income individual or community for resources and solutions, ABCD starts by asking the materially poor how they can be stewards of their own gifts and resources, seeking to restore individuals and communities to being what God has created them to be from the very start of the relationship. Indeed, the very nature of the question—What gifts do you have?—affirms people’s dignity and contributes to the process of overcoming their poverty of being.10

D. Written for ordinary readers, not economists

We have written this book for ordinary adult readers. We have not written it for professional economists (though we hope that many of them will read it and agree with it). The book is therefore written mostly with ordinary language instead of technical economic terminology. Where specialized terms are needed, we explain them in the text where they first occur.

E. Written to leaders, especially Christian leaders, but also those who are not Christians

Our primary audience for this book is Christian leaders in poor nations(but also non-Christian leaders—see below). We are writing especially for Christians who believe the Bible and are willing to follow its principles for economic development. And we are writing to leaders, because they are the ones who can bring about the necessary changes in their countries.

By “leaders” we mean government leaders, business leaders, education leaders, non-governmental organization (NGO) leaders, charitable organization leaders, and certainly church leaders, especially pastors (because their preaching and teaching can eventually change a culture). We also hope that some who read this book will be inspired to seek to become leaders in their nations so that they can begin to implement the changes we outline.

However, we also hope that Christians in more prosperous nations will read this book, because many of them can have influence on poor nations through mission organizations, mission trips, friendships, development organizations, and denominational networks. We hope that some readers in wealthy nations might even be moved to devote their lives to helping poor nations escape from poverty in the ways we outline here. (Also see some practical suggestions at the end of chapter 5, here.)

If you are reading this book and do not consider yourself to be a Christian, or do not think of the Christian Bible as the Word of God, we still invite you to consider what we say here. Many of our facts and arguments are taken from economic history, not from the Bible. As you read the parts that are based on the Bible, we invite you to at least think of the Bible’s teachings as ideas that come from a valuable book of ancient wisdom, and consider whether the ideas seem right or not.

Our book also has some application to wealthier nations today. History shows that many wealthy nations have failed to remain prosperous (think of the once-wealthy kingdoms of Egypt, Babylon, Persia, Greece, Spain, and the Ottoman Empire). We hope that readers in wealthy nations will see applications of this book to their own countries, especially those that are in danger of abandoning the policies and values that made them economically prosperous in the first place.

To anyone in a leadership role in a poor country, the message of our book is this: there is a solution to poverty that really works. It has been proven again and again in world history. And it is supported by the moral teachings of the Bible. If this solution is put into place, we are confident it will lift entire nations out of poverty (not just a few individuals). We are asking you to consider this solution for your own nation.

At this point, someone might object that renowned developmental economist Paul Collier has demonstrated that one billion of the world’s poorest people live in fifty-eight smaller countries that are essentially caught in four different “traps” that make it much more difficult for them to escape from poverty than for four billion other people in developing economies. Those traps are: (1) the conflict trap, (2) the natural resource trap, (3) the trap of being landlocked with bad neighbors, and (4) the trap of bad governance in a small country.11

We find Collier’s book remarkably well informed and insightful. We recognize that the factors he points out make the task of overcoming poverty more difficult in these nations. But even Collier is hopeful about the possibility of progress, for he wrote his book to explain some steps that wealthy nations can take to help the countries where “the bottom billion” live. We believe that, though the task is difficult, the steps we propose in this book will eventually bring even these poorest of nations from poverty toward more and more prosperity

F. Written for students

We hope that many college students, especially those who are Christians, will find this text helpful as they seek to determine their own convictions about appropriate methods of addressing world poverty. We have both spent many years in classroom teaching at the university level, and we hope that this book will prove helpful as an assigned text in college and seminary classes dealing with care for the poor and a Christian approach to economic questions.

G. Why don’t economists agree on a solution to poverty?

Someone might raise an objection at this point: “If there is such a clear solution to poverty, why do economists not all agree about it and write books explaining what the solution is?” In response, we would cite several points:

(1) Some do agree. Several respected economists have written books that agree in large measure with the solutions we propose in this book. For example, much of what we have written here is indebted to the work of David S. Landes, The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor.12 Landes is professor emeritus at Harvard University and one of the world’s most respected economic historians.

Readers may notice, especially in chapters 7–9, that we cite Landes’s book more than any other source. We do this because his massive study (658 pages, including 126 pages of fine-print documentation) is an unparalleled source of historical information about the economic development of all the nations (or regions) of the world in the last five hundred years. The first sentence in his book reads, “My aim in writing this book is to do world history.”13 And world history, on a grand scale, is what he does. John Kenneth Galbraith said this book “will establish David Landes as preeminent in his field and in his time.” Nobel laureate Kenneth Arrow says the book is “a picture of enormous sweep and brilliant insight . . . [with] incredible wealth of learning.”14

In addition, we agree with several other economists and developmental historians in key sections of our book, especially regarding the economic and legal policies that are necessary to overcome poverty. For example, we cite with approval several key sections from the writings of Hernando de Soto; William Easterly; Paul Collier; P. T. Bauer; Lawrence Harrison; Niall Ferguson (a historian); Daron Acemoglu and James A. Robinson (though we also differ with them on the importance of culture; see below); and William Baumol, Robert Litan, and Carl Schramm.15

Of course, many economists do not advocate the solution we propose in this book. They propose only partial solutions or even incorrect solutions because of their underlying assumptions.

(2) Professional donors. For example, some economists are “professional donors.” They spend much of their time giving away other people’s money, and their primary solution to world poverty is to give away more money (even though they admit that giving away money has not solved the problem so far). The most prominent representative of this approach is Jeffrey Sachs in his book The End of Poverty.16

(3) Pure economists. Others are “pure economists” (at least in their solutions). They do not address cultural, moral, or spiritual values at any length, presumably because they think that these topics are outside the realm of legitimate study for economists. One example of this approach is that of Dambisa Moyo in her book Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa.17 Moyo offers a perceptive analysis of the harm caused by foreign aid to Africa, but her solution is simply to stop the foreign aid, assuming that after aid is stopped, “good governance . . . will naturally emerge.”18 She mentions cultural values in passing but minimizes them.

(4) Cultural equalizers. Other economists are “cultural equalizers.” They are convinced that it is misleading or even wrong to say that any one culture is “better” than any other, even “better” at producing economic growth. Therefore, there must be some other reason, or perhaps it is an accident, that some countries have become wealthy and others remain poor. We should not try to explain the disparity by saying that one country’s cultural habits and values are better than another’s.

For example, more than a dozen scholars, each with outstanding credentials and publications on economic development and foreign aid, contributed to Making Aid Work, a 2007 symposium on foreign aid. There was hardly a word in the entire book about the need for cultural transformation within countries.19

(5) Fatalists. Still another approach has been taken by those we may call “fatalists.” They claim that economic prosperity came about simply because some nations had the good fortune of favorable geographic factors, such as moderate weather, abundant natural resources, and useful animals, from the beginning, so it was inevitable that they would become rich while others would remain poor. The primary example of this approach is Jared Diamond in his book Guns, Germs, and Steel: The Fates of Human Societies.20 According to Diamond, geography is more important than everything else, and his analysis gives no room for the impact of differing human choices, cultural values, and moral and spiritual values.

(6) Socialists and other “planners.” Still other economists are “socialists,” of stronger or weaker varieties. In their view, the solution to poverty is more planning—wise government “experts” should plan and direct most everything in an economy. If it is pointed out that government control of factories and businesses has not worked well in the past, their response is that the wrong government experts were in charge. We simply need different experts, better ones, they say. In fact, if asked, they might even humbly suggest that they themselves might just be available to serve as these new experts—in a limited capacity, of course—at least initially. Easterly refers to these economists as “Planners,” and says they usually do more harm than good.21

With these six viewpoints in mind, consider the predicament of leaders in poor nations. They have at least six radically different opinions, all from economic “experts.” With all these “experts” telling poor nations how to solve their problems, it is no wonder that their government leaders find it hard to know whom they should trust. Are the professional donors right? The pure economists? The fatalists? The socialists? The messages are contradictory and confusing.

Abhijit Banerjee, professor of economics at the Massachusetts Institute of Technology and a director of the Abdul Latif Jameel Poverty Action Lab there, summarizes the current confusion in academic studies of aid and economic development:

Instead of a handful of simple and clear-cut laws that tell us what to do and what to expect, we have a hundred competing tendencies and possibilities, of uncertain strength and, quite often, direction, with little guidance as to how to add them up. We can explain every fact many times over, with the result that there is very little left that we can both believe strongly and act upon.22

Robert H. Bates, professor of government at Harvard, agrees: “In truth, there is no theory of development that is logically compelling and demonstrably valid. One good indicator of this deficiency is the very abundance of theories. . . . The field of development responds less to evidence than to political fashion.”23

That is why we think this book can play a unique role. It combines economic analysis with biblical teachings. Once we are able to set aside limiting assumptions and look honestly at results (asking, “What has worked in the past?”), it seems to us that the economic analysis points clearly in the direction that we propose.

On the biblical side, we argue in this book that the moral and economic teachings of the Bible can give confidence to leaders in poor nations that our solutions are supported by the very teachings that God himself gave to the human race. This provides a strong reason for leaders, especially Christian leaders, to follow these principles rather than others that have been proposed.

H. Why should we help the poor?

More specifically for purposes of this book, why should Christians want to help the poor? The Bible gives us two kinds of reasons.

First, there are the general commands of Scripture. Jesus says, “You shall love your neighbor as yourself” (Matt. 22:39). If we love someone who is poor, we will want to help that poor person.

Jesus also said, “Let your light shine before others, so that they may see your good works and give glory to your Father who is in heaven” (Matt. 5:16). If we want to let the “light” of our conduct shine before others, we certainly should give help to those in need. In fact, the apostle Paul says that God has called us to live lives that are characterized by “good works”: “For we are his workmanship, created in Christ Jesus for good works, which God prepared beforehand, that we should walk in them” (Eph. 2:10). Certainly one of the good works that God wants us to do is helping those who are in need.

Second, we should want to help the poor because there are numerous specific commands in Scripture that tell us to do so.24 Here are some of them:

If among you, one of your brothers should become poor, in any of the towns within your land that the LORD your God is giving you, you shall not harden your heart or shut your hand against your poor brother, but you shall open your hand to him and lend him sufficient for his need, whatever it may be. (Deut. 15:7–8)

For there will never cease to be poor in the land. Therefore I command you, “You shall open wide your hand to your brother, to the needy and to the poor, in your land.” (Deut. 15:11)

Blessed is the one who considers the poor! In the day of trouble the Lord delivers him. (Ps. 41:1)

Whoever oppresses a poor man insults his Maker, but he who is generous to the needy honors him. (Prov. 14:31)

Only, they asked us to remember the poor, the very thing I was eager to do. (Gal. 2:10)

But if anyone has the world’s goods and sees his brother in need, yet closes his heart against him, how does God’s love abide in him? (1 John 3:17)