Here’s an ugly side effect of America’s economic crisis: gloating French intellectuals.
One of them watching Wall Street’s woes said he felt a “shiver of pleasure that finally something serious is happening to the kingdom of liberalism”—a joy tempered only by his dread that the collapse could spread beyond America. That appeared in the newspaper Liberation, which the Los Angeles Times describes as “a voice of French intellectuals whose disdain for capitalism persists in the 21st century.”
Among European leftists “who have long predicted calamity for what they call the ‘savage neoliberal capitalism’ of Wall Street,” the Times wrote, “there were gleeful allusions to the stock market crash of 1929.”
Shivers of pleasure? Gleeful allusions to 1929? Ugh.
Granted, the idea that capitalism is the best possible economic system has taken a hit. But is Europe’s socialist model the answer?
It looks like America is about to find out, as it ventures into uncharted waters where apparently the solution to every crisis is government intervention.
For the moment, radical moves by Ben Bernanke, Henry Paulson and Timothy Geithner—the most sweeping government intercession in the economy since the New Deal—are generating cautious optimism. Perhaps total economic meltdown in the United States will be averted. At least for today.
The longer-term prognosis is far bleaker, however, for one simple reason. These remedies are failing to address what caused the problems to begin with.
Why is the U.S. financial system so diseased? It seems no one is willing to admit the real reason—even though it has been painfully evident for years.
The housing crisis involved a whole web of related problems with essentially a single cause. As Robert Morley wrote a couple weeks ago, you had “thousands of buyers lying on their mortgage applications; appraisers inflating valuations; lenders knowingly overlooking suspect documentation because they were just going to sell the mortgage to someone else anyway; credit-ratings agencies providing triple-A ratings to risky subprime mortgages even though they knew many were up to 10 times riskier than similarly rated investments; and the National Association of Realtors telling people it is always a good time to buy and vigorously denying the existence of a housing bubble—even as the bubble was clearly popping.”
Pretty repulsive stuff—up and down the chain.
What was the cause of this catastrophe? Any direct mention of it tends to raise people’s hackles. People fault the lack of regulation. Okay—but why do we need regulation?
Because of greed and its associated sins. Lying. Stealing. Coveting.
The love of money, Scripture tells us, is the root of terrible, terrible evil. And as Proverbs 28:20 says, “He that maketh haste to be rich shall not be innocent.”
Across the board people have been working the system to get all they can—regardless of right and wrong, regardless of the non-monetary cost, regardless of who gets hurt.
It has all been caused by the way of get. This breaks God’s moral, spiritual law, which establishes the way of give.
Whenever we write about this, many readers turn up their noses. Good article—until you brought the Bible into it! God and economics don’t mix, we hear. Why do you keep hammering at the Old Testament? That doesn’t apply to us anymore.
Oh, but it does apply. Our broken economy proves it.
No one doubts the existence of physical law. The skyscrapers on Wall Street couldn’t have been erected without a respect for it. Some even believe in a Creator who designed physical law. Why should we believe, then, that the moral law that He authored and codified to govern human relations is any less binding on us—even when we see mountains of evidence that it breaks those who break it?
God’s Ten Commandments prohibit lying and deceit. That would include fraudulent accounting practices, falsifying loan applications, misrepresentations of the health of mortgages to potential buyers, and so on. Man-made regulations and laws forbid most of these practices, but still, countless individuals and businesses felt they would come out ahead if they engaged in them anyway and got away with it. They overlooked the fact that they were also breaking a God-given moral law—something that always exacts a penalty.
The commandments proscribe stealing. A particularly egregious violation of the spirit of this law is the kind of severance packages we are seeing among the ceos of these failed Wall Street firms: $22 million for Lehman Brothers chief Richard Fuld; $60 million for Bear Stearns chairman Jimmy Cayne; $68 million for Citigroup’s Chuck Prince; $161 million for Merrill Lynch’s E. Stanley O’Neal. The recklessness of these men cost hundreds of thousands of people untold wealth. The fact that they are enriching themselves on the backs of the people they broke gives insight into how they conducted their business. No wonder their companies crashed. Though they are apparently violating no man-made laws, they are absolutely trampling on God’s spiritual law.
The commandments forbid coveting and greed. These sins have been at the very heart of this financial crisis. At every level.
The fact is, no financial system can stand for long when its foundations are compromised by such corruption.
People do not want to hear about sin. But whether or not they admit it, that is exactly what has caused their economic suffering. All those who are losing jobs and wealth are suffering the results of broken spiritual laws. Not necessarily their own sin, but sin just the same.
The loss of America’s global prestige and influence occurring as a result of this collapse is a curse that comes from breaking God’s law.
Many people believe God’s law is a curse. Actually, it is an incalculable blessing, because it reveals exactly which behaviors will inexorably lead to curses such as those we see today, and which will lead to blessings.
Deuteronomy 28 actually records the blessings that will accrue to a people that chooses to keep that law, and the curses that will befall a people that pays no heed to it. One blessing is especially pertinent: “The Lord shall open unto thee his good treasure, the heaven to give the rain unto thy land in his season, and to bless all the work of thine hand: and thou shalt lend unto many nations, and thou shalt not borrow” (verse 12). As recently as the 1980s, America was the world’s largest creditor nation.
Still, at that time, thanks to the government’s financial mismanagement, public debt began to balloon rapidly. As it rose from the mid-$1 trillion range up to $3 trillion, Plain Truth editor in chief Herbert W. Armstrong warned, “The U.S. and the entire world face a grave economic future from the burden of mounting debts” (letter, Oct. 25, 1985; emphasis mine).
That debt has since swelled to almost $10 trillion—not counting promised Social Security checks and other liabilities. In a single generation, America has become the world’s most indebted nation. It is suffering from the curse described in verse 44 of Deuteronomy 28.
An enormous amount of the government’s debt is owned by foreign nations that, you can be sure, are strategizing intensively about how to pull their money out of this spastic and sickly American system as quickly as possible without jeopardizing their investment completely.
Though the market is hopeful that the government’s intervention will stave off disaster, in reality the government itself is compromised with the same fundamental problems that the private sector is. Though it pretends to have the resources to fix these problems, the truth is that it too is a hair’s breadth away from requiring outside intervention itself.
Because of America’s epic indebtedness, other nations now have the power to decide America’s economic future! As Proverbs 22:7 says, “the borrower is servant to the lender.”
Ten years ago, the late Tim Thompson, the Trumpet’s financial writer at the time, spoke of this very inevitability. “On the international level, strength of character is equated with strength of economy, and both are extremely lacking today in America!” he wrote. “[G]lobal investors are becoming increasingly aware that an investment in America is no longer an investment in strength. There is only an illusion of strength being propped up by foreign capital” (Trumpet, November 1998).
The historic blows America’s economy has suffered this month have irreparably devastated its standing as a sound investment.
“Once a loss of confidence occurs,” Mr. Thompson continued, “the reaction is similar to the effect of adultery in many marriages today—victims of such a breach of trust start looking for a way out, and many times they take every financial advantage they can on their way out the door.”
The global system is still dependent upon America enough that this effect may take a little bit of time, but soon there will be a pile-up of sell orders on America’s “stock”—just as there were on the giants of Wall Street last week.
Mr. Thompson concluded, “America is going to be blindsided and totally shocked when she is rejected by the investors of the world.”
You can already hear them celebrating the inevitability of America’s fall. The shivers of pleasure—the gleeful allusions to 1929—as they anticipate the shift of global economic power away from a fatally diseased America.
Biblical prophecy tells us exactly which power is going to take America’s place, and the financial heights it will reach on America’s broken back. For an overview of that prophetic future, read Mr. Morley’s column from yesterday. For a more detailed study, read Herbert W. Armstrong’s The United States and Britain in Prophecy. •