America’s Level of Prosperity Is Not Sustainable
The proposition that the level of prosperity the U.S. enjoys is unsustainable will inevitably draw scorn from patriots and economists alike. Wealth creation, to many, has no fixed ceiling. Whether because of faith in the idea of American exceptionalism or in Yankee ingenuity or that America possesses an unsurpassed entrepreneurial spirit, or in our military might or that the good times will continue because we are the recipients of God’s favor, many cannot be convinced that our fortunes will decline significantly and for a considerable length of time.
Whatever one may think about the United States, one thing Christians should know is that the U.S. is not special enough to violate God’s principles without repercussions. The borrower is still slave to the lender (Proverbs 22:7) and the wicked borrow and do not repay (Psalm 37:1). And that is the problem – we are a debtor nation, have been for a long time and may not be able to repay what we owe.
IOUs and You
We must reap what we have sown (Galatians 6:7).
The United States has had a trade deficit each of the past 40 years. Simply stated, on a net basis, we have obtained goods and services from other nations in exchange for IOUs in the form of dollars. Essentially, what this means is that we have enjoyed a portion of the fruit of the labor of people in other nations in addition to the fruit of our own labor. We consume more than we produce. If we ever intend to pay them back, we must reverse the process and produce more than we consume with the excess production going to our creditors. This obviously requires a lower average standard of living in the U.S.
Another option to make good on our IOUs, and one that is occurring now, is for people of other nations holding dollars to buy up our real estate and corporations. Certainly we are not as wealthy or prosperous when foreigners own our land and factories and we possess our returned IOUs.
A third option is to not repay or at least not repay everything we owe. This is why, in my opinion, the Federal Reserve targets an inflation rate of 2%. When successful, the value of our debt is reduced by nearly half after 30 years. Whatever circumstances Psalm 37:1 includes, it certainly must mean that those with a planned goal to continue consuming other’s goods and not fully repay the debt they owe are acting wickedly.
Postponing the Inevitable
When illuminated by the light of Scripture, our nation’s current economic policies and monetary maneuvers can be seen for what they are – attempts to deny the consequences of debt and postpone the inevitable day of reckoning.
We really don’t have to look very hard to see that we are already beginning to reap a harvest of misery. The decrease in our standard of living is evidenced by increased underemployment, increased inequality, stagnating wages and an intractable dependence on entitlements even as we continue to increase our indebtedness.
A Christian Response
How should we, as American Christians, respond to the unpleasant facts of our economic situation? Even though changes could be made to our nation’s fiscal policies or to the global economic system that would, over time, improve our debt burden; and even though it is true that increases in productivity lead to increases in living standards, we still have this reality facing us – our standard of living is going to decrease.
If it is true that we should repay our debts, and I believe it is, then even if our leaders make wise economic choices from here on, we still face a major reduction in our prosperity.
How will hard economic times affect your walk with the Lord?
May I suggest a few ways one’s faith can increase? What if hard times help deliver us from our idols and lead to a greater trust in God? What if we learn contentment instead of covetousness and generosity instead of greed? What if, having been stripped of our security blanket of riches, we become free in the arms of Providence to love fully and fearlessly?
Would these things not make us richer than we are now?
We adhere to a faith that teaches us to be thankful for and content with much less wealth than we have now (1 Timothy 6:6-10; Philippians 4:12-13; Proverbs 30:8; Matthew 6:11). Would it really be a disaster if we had to live with less? Can Christians not, if prepared to do so, be beacons of light amid the darkness of whatever economic trouble lies ahead? I pray we will be.
If you study economics at all, then you probably won’t be surprised to hear that some economists claim that we needn’t worry about the next generation because government debt cannot be passed from one generation to the next and that it is impossible for the United States to default on its debt because it can always print money. This article and this article make these claims. An interesting exercise, for anyone so inclined, is to discover and expose the non-biblical worldview lying beneath these assertions.