Part 1 of A Discussion of Thomas D. Simpson’s Capitalism versus Socialism Chapter 1 “Pillars of Economic Systems”
It seems like a bold statement to say the Bible can tell us what economic system we should have. In fact, Simpson does not think it can directly, but if we define each economic system by its stance on each of the four pillars, he says we can determine biblical teachings on those.
I write this not for bible scholars only but really for anyone who may be curious what the Bible could have to say on this topic, whatever your faith tradition may be. There are a lot of cultural misunderstandings around this topic.
Four Pillars Define the Four Economic Systems
Every economy rests on four pillars. (p. 3)
- Who owns property?
- Who decides what is produced?
- Who decides how it is produced?
- Who decides how to allocate the goods that are produced?
Many economic text books open with this sort of discussion because economics is the study of the allocation of our scarce resources. These questions will be answered one way in a socialist system and another in a free market system.
The answer for all 4 questions for socialism (and communism) is the State, also called the government, while private individuals are the answer for all 4 questions for the free market system. (p. 5)
With this definition, we can see socialism/communism and capitalism are the two extremes. Simpson is examining the repercussions of both of these systems and is also including a look at two other systems, fascism and the welfare state.
Fascism is in between socialism and capitalism. There is private property in fascism so private individuals own property and decide how to produce. However, it is the state that decides what should be produced. Then it is a combination of the state and private individuals who decide who the goods should be distributed to.
Even though he answers these 4 questions the same way for communism and socialism, he later writes a chapter on socialism by itself and groups communism and fascism together in a chapter.
It seems a little confusing why he might do that, other than he considers both communism and fascism as deriving from socialism. (p. 4)
Communism agrees with socialism on the answers for all four of the pillars, but it differs from socialism because of its ideology which posits the state would eventually cease to be as people’s motivation changes from self-interest to what is best for the collective. (p. 4)
And fascism shares with socialism the central planning of production, though the means of production are privately owned.
Many advocates of socialism today — such as Bernie [Sanders] and AOC [Andrea Ocasio Cortez] — actually seem to favor something more akin to fascism. They advocate a highly taxed and highly regulated economy but haven’t made a big pitch for widespread state ownership of property. (p. 5)
That seems like a surprising statement to make, but if he is right that they are fine with private ownership, then they could be seen to be answering the four pillars in line with fascism:
- private individuals own property,
- the state decides what is produced through taxation and regulation,
- private businesses produce the goods, and
- the output is earned by private individuals with generous state reallocation through taxes.
Fascism can be recognized in a country when you see a lot of public/private partnerships. The businesses are privately owned but they are responsive, or even beholden, to the preferences of the state.
Finally, he will write about one more economic system, the welfare state. For the four pillars, he says the welfare state is similar to the market economic system by pointing to private individuals for answering each question. The one difference is the state also plays a role along with the private individuals in answering who decides the allocation of the goods.
What Does the Bible Have to Say?
Many people have a sense the Bible does call for socialism, at least in the New Testament and thus Christianity. Chapter 2 of Acts is most often pointed to.
Acts 2:44–47 (ESV): And all who believed were together and had all things in common. And they were selling their possessions and belongings and distributing the proceeds to all, as any had need. And day by day, attending the temple together and breaking bread in their homes, they received their food with glad and generous hearts, praising God and having favor with all the people. And the Lord added to their number day by day those who were being saved.
This sentiment is bolstered a couple of chapters later.
Acts 4:32 (ESV): Now the full number of those who believed were of one heart and soul, and no one said that any of the things that belonged to him was his own, but they had everything in common.
What’s missing here for this to be socialism is a role for the state. Remember, socialism answers each of the four pillars with the state as the deciding party. Here, private individuals are choosing to pool their goods together.
It’s noteworthy that members of this community gave up their personal property to share with others voluntarily — indeed cheerfully. Coercion isn’t suggested. (p. 8)
To better answer the question of what kind of economic system is supported by the Bible, Simpson says we need to see what support there is for each of the four pillars.
It should be noted that the Bible doesn’t specifically prescribe any of the economic systems introduced above. Nonetheless, there are certain conclusions that we can reach from Scripture that can help guide us to an understanding of which system is most consistent with biblical teaching. (p. 7)
In the next blog, we will examine what the Bible has to say regarding each of the four pillars.
Reference: Simpson, Thomas. D., 2020. “Pillars of Economic Systems,” Chapter 1 of Capitalism versus Socialism, Thomasdsimpson.com.
