When inflation rates rise, the Right often makes demagogic appeals to the Gold Standard accompanied by denunciations of fiat currency and central banking policies. Some go much further and speak of conspiracies. Others focus on the ethical side of things and how inflation is a form of theft in that it decreases the value of money that people have worked for, saved, and invested.
There's an element of truth to all of these things but as is
often the case the discussions become distorted by reductionism and are further
distorted when viewed through the lens of other erroneous and immoral
commitments such as nationalism, politics, and false ideology.
It's an open secret – in fact no secret at all, that the
Federal Reserve acting at the behest of Wall Street wants a low rate of
inflation, right around 2%. This is viewed as 'healthy' as it drives
investment. What they don't want is people parking their money in a shoe box,
under the mattress, or in a coffee can out in the yard. They want the money
invested in the system. It's very Bestial one might say. This ought to raise
some profound questions for Christians and even generate something of an
existential crisis for the Church and how it interacts with this mammon-driven society
– but it doesn't. The Scriptures have almost no bearing on these issues in
modern Christian thinking. Capitalist orthodoxy has been thoroughly assimilated
by the overwhelming majority of the Christian community even in defiance of not
just the Scriptures but centuries of historical testimony.
What the Right often misses is the fact that Capitalism
itself is what drives the inflation and this is true from multiple angles –
only a few will be mentioned here.
To begin we have to provide some context and widen the
discussion. In the present circumstance the Federal Reserve policy of raising
interest rates is being employed to slow the economy – yes, even to the point
of recession.
Why? Why would Wall Street want this? Why would the banks and
the corporations engage in such a policy?
To ruin America? Is it a communist plot? Some people have
been led to think so, but these arguments can be summarily dismissed.
With the conditions that emerged with Covid, such as the
labor shortages and the supply chain disruptions – a workers economy emerged.
Wages went up and have continued to climb. Workers in such an economy can make
demands and this represents a dire threat to the interests of Wall Street and
its bottom line. Profits and stock values can be manipulated and costs can be
absorbed, passed on, and negotiated, but a steep increase in wages and
worker-related overhead, let alone worker influence, can spell disaster not
just for the bottom line but for corporate control. Workers cannot be emboldened.
They need to be kept down, in debt, and distracted – consuming not contending.
Between the rise in costs, shortages, and higher rates of
labor, Wall Street is screaming for a correction. An economic slowdown will
mean a restriction in credit. Higher prices will lessen demand and the result
will be a worker glut. Businesses will shrink and indeed a bad holiday season
will result in another retail implosion, but this only strengthens the hands of
the monopolies, the businesses on top of the pyramid. As the analysts moan, the
suites on the top floors will resonate to the sound of clinking glasses and
cigar smoke.
All the way around, the inflation/interest rate dynamic will
lead to short term loss and pain, but long-term gain. The architects of the US
economy want to see the present situation change and soon.
The Gold Standard anti-inflation argument ignores the
destructive nature of the unrestrained business cycle and deflation. An
inflation/deflation cycle will allow currency to seek its own level as it were
but in a Capitalist economy built on credit – deflation is disastrous and very
destructive. Values are destroyed, collateral is diminished, and borrowers and
lenders can find themselves underwater. The man in the street has a dollar in
his pocket that's worth more but to expect the powers that be to simply
acquiesce to this as some kind of macro-economic law of nature is not
realistic. And as seen during the Great Depression, that dollar in the pocket
gets spread pretty thin when there's no work and the economy comes to a
grinding halt. And when banks are collapsing and the dollar gets buried in the
back yard, the economy further seizes up.
Contrary to the Capitalist orthodoxy that many Christians
seem eager to defend, powerful interests are not going to simply bow to losses
when they can combat this tendency. The market is supposedly regulated by
supply and demand but the monied class realized long ago that the supply-demand
dynamic is something that can be manipulated and managed. It is in fact
something of an illusion. The entire advertising industry is built around this
– not to help consumers make informed decisions, so they can 'vote' by making
or not making purchases. On the contrary, their aim is to deceive, promote
covetousness, and in every way manipulate the demand in order to conform with
available supply – with an end result of maximised profit.
Further the Gold Standard argument fails to take into account
the bubbles created not just by credit, but speculation in the markets, as well
as market and real estate bubbles. The cycle demands corrections to the value
of the currency and yet these corrections can be devastating to not just
markets but whole societies and communities. Lending and share growth
effectively create money and yet if that money is limited by the available
stock of the precious metal standard that backs the currency – deflation is
inevitable, or even a collapse if there's a run on the bank or a massive attempt
to redeem the said currency and exchange it for gold. Now factor in all the
possibilities when it comes to international investment and loans and you have
a very precarious situation. This is why in the post-Depression landscape the
Gold Standard was progressively abandoned – Nixon completing the process in
1971.
And further, with the advent of industrialisation, the
military-industrial complex, and total war, the idea of leaving core economic
concerns to the unstable forces of the market becomes unthinkable. Industries
and infrastructure (which includes banking and currency) become strategic and
as such corporatism (whether state or market dominated) becomes inevitable.
Corporatism along with all the inflation-related problems becomes inevitable
under the aegis of developed or late-stage capitalism.
This is not to defend the present system. By no means! It's a
wicked and immoral system built on exploitation and usury. My concern is with
regard to those Christians who have drunk deeply from the poisoned wells of
capitalism but fail to understand its implications and how it works, not on
paper in an Ivory Tower paradigm, but in the real world – a point we will
revisit momentarily.
And while many libertarians decry corporatism and monopoly,
once again they fail to understand that these are the inevitable result of
capitalist economics. As such their economic system as well as their own
thinking and commentary are rife with internal contradiction. They also fail to
understand how this system relies on the nation state and as such (as a system)
it eventually becomes predatory, militaristic and imperialist. The monopolistic
impulse does not stop at the border nor is it limited to pure economics. It
reaches a point where it begins to transcend these categories – the globalist point that some on the Right
have misunderstood as a form of socialism but in reality is monopolistic
capitalism transcendent, imperial, oligarchic, and bestial.
And when it comes to 'Corporatism' there is a great deal of
confusion as both Left and Right point to this as an evil. Right-wing free
market and libertarian types usually speak of it in terms of Mussolini-style
fascism with the state domination of the economic sector. They view
state-corporate partnerships in this capacity and this is their means of
critiquing the great monopolies – they become indiscernible from the state. By
identifying this tendency as a form of 'statism' they can divorce it from their
libertarian capitalist models – or so they think.
Indeed, Corporatism can be represented by a fascistic or
authoritarian state dominating business – which is still allowed to invest and
seek profits but it must subordinate its policies and interests to the state. One
thinks of Krupp and IG Farben in Germany, or Fiat and IRI in Italy. We see this
sort of thing at present in a place like China, which is not communist in the
least (and hasn't been for over forty years) but represents a kind of
Corporatist-Authoritarian Capitalism.
But at the same time Corporatism can also refer to businesses
that become so powerful that they can wield tremendous influence over the state
and indeed as a form of oligarchy they can dictate policy to it. We think of
not just JP Morgan, Rockefeller, and men like them during the Gilded Age but
modern Robber Barons like Musk, Bezos, and Gates in our own day – not to
mention the Walton family or the titans within the oil industry and the
military industrial complex. In this Corporatist model, the state becomes
subordinate and serves the interests of these companies and their 'demand' for
markets and resources.
In both cases the power paradigm becomes very blurry and the
functional difference between these types of corporatism can and often
disappears. This is the stuff of dystopian books and films. I always think of this
'blurring' as I drive into Washington DC or New York City. Which is the power
centre? Which is the true capital? It's a question that cannot be answered.
They both are and it's the people who sit astride these spheres that are the
real rulers of the American Empire.
Again, the Right has great faith in a capitalism that exists
only on paper, only in theory – the kind of capitalism represented by the
writings of Thomas Sowell or what you might encounter in a misleading and
dumbed down YouTube video, like the kind put out by Ron Paul or PragerU.
Ironically they often don't like what capitalism becomes when it's placed in
the context of a real economy – one that interacts with politics and
geopolitics. Monopolies are going to seek to dominate the markets and regulation
can both help and hurt. In the end they actually want regulation, they simply
want it crafted to their benefit – and to the detriment of small competitors.
That's 'competition' taken to the next level. You can stop this kind of abuse
of the system but that requires the state to intervene and impose regulations –
something Libertarians do not want to see.
Inflation also serves an important purpose. It can be used as
a form of coercion – and for those who give in to the demands and enticements
of mammon, it can be used as a weapon, which is what we're seeing at present.
The storms of the stock market and even recession are viewed in terms of the
big picture. And the financial elites are not all powerful. They cannot manage
everything and there's always a risk. They too rise and fall, form alliances
and turn on one another. These things can spiral out of control and there are
always dozens of other factors at work – wars, politics, elections, and the
like.
In Europe which is also dominated by its capitalist class,
there are still some remnants of real democracy and as such the ruling class
does not have as free of a hand. This is in part explained by the economic
devastation of World War II and the fact that economies had to be rebuilt and
societies re-ordered in its wake. Great public sacrifice was made during and
after the war and the architects of the new order did not have carte blanche. They had to answer to the
Americans – and the public. In much of Europe, the workers still possess some
potency as governments and financial centres fear resistance. Parliamentary
systems afford more opportunity for change (with party coalitions and snap
elections) as does the threat of a general strike – both virtually unthinkable
(if not impossible) within the US system.
In 1945, the US was the most powerful nation in the history
of the world and its economy was dominant. There was prosperity to be sure but
its absolute dominance didn't last long and once profits were challenged by the
rebuilt (and frankly vibrant) industrial sectors of Europe and Japan, the war
on workers began with a vengeance. Profits had to be squeezed from wages,
leading eventually to the rise of offshore sweatshops – and lost jobs and
destroyed communities in the American Rust Belt.
In the American Wall Street-dominated order, the markets
wield near absolute power and as such they are unwilling to leave the margins
of the field ungleaned. Profits reign supreme and both elements of the
contrived two-party duopoly are servants of this Capitalist order. Neither of
the extremes within the dominant parties (on either the Right or Left)
represent any existential challenge to the existing system – not even the
handful of so-called socialists. As such, democracy in the United States is
largely a sham. It's theatre on a grand scale to be sure, but it's largely a
charade. There is no socialism in the United States and there is no threat of a
general strike. And the Democratic Party which supposedly is on the side of the
unions worked decades ago to subvert the unions. Rather than represent workers
the unions now serve a liaison function, occasionally allowing workers to let
off some steam for a day or two. Their main task is to represent the interests
of the companies (which they now work for) and the interests of Wall Street.
All of these things are part of the mammon game that is the
world system. It is corrupt through and through. I have yet to find any sector
of the economy that is not rife with deceit and corruption from top to bottom.
It's a game of musical chairs, a shell game, a case of mass deception –
especially for those who really believe in it and its purported integrity. One
trick that makes it work is that everyone only sees their sphere and by means
of internal reasoning they can ethically justify what they do. Those that see
corruption are able to project it on to someone else in the system either up or
down the line.
Diogenes would find no honest man in this society and his
lantern (undoubtedly made at Wal-Mart) would probably break after just a few
days.
Now we can be wise and understand that the world order is
just that – a game and an evil one at that. As such we can pilgrim-fashion take
a step back, retain moral standing, and offer a robust Christian critique of
this evil order. We can follow Christ and as such refuse to serve the mammon
order.
Or we can buy into its patterns of thought, its ethos, and
its values and as such we will ride its waves, invest in the system, and be
subject to manipulation. The end result is slavery, idolatry, and a faith
choked by the cares of this world as well as foolish and hurtful lusts that
drown men in destruction and perdition. We are to flee this lust for mammon which
is the root of all evil. Once this is understood, the tortured patterns of war,
upheaval, idolatry, madness, and self-destruction come into focus and are
easily understood.
The first option (the New Testament option) is easy on paper
– but a little harder in real life. It will mean marginalisation and even
ostracisation and this is why Evangelicals and other mainstream Christians will
never have any interest in it. Jehovah Jireh is not their God. Jehovah Tsidkenu
provides them no comfort. The only 'Jehovah' they're interested in is
Jehovah-Mammona – the god some early Church Fathers identified with Beelzebul.
We can get worked up about inflation and Federal Reserve
policy and like drooling fools cast blame at the other party, following a
script provided by politically bought television producers. Or we can think
like Christians and say, it's Caesar's coin in the end (which is what Christ
taught) and be content even if it means tightening our belts and prayerfully
adjusting our thinking. The adjustments are a lot easier when you're not
invested to begin with.
Faithfulness means we will not flourish in this society or
any in this age. Those that do have made compromises and in many cases have
fallen into dangerous patterns of self-deception.
Get used to it, and these economic ups and downs begin to
wash over you and play little part in shaping your daily life and thought.
Taking a step back affords you the ability to see how foolish this all is and
how men under the power of these idols drive themselves mad. And you will also
see how these agents of the Abyss are at work in the Church and have already
influenced (and in other cases control) many pulpits and ministries. Didn't the
Scriptures tell us as much?