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Blessed are the Rich: Monetarism and Christianity

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Michael Hudson wrote in Global Research that the University of Chicago (UC) was converting the Chicago Theological Seminary into the Milton Friedman Institute for Research in Economics, MFIRE, which might as well be Monetarism, Finance, Insurance and Real Estate—the providers of “free lunches” the Friedmanites celebrate. A UC press release even refers to the conversion of the seminary into “a temple of neoliberal economics”, contrasting the old religion of Christianity with the new one of unfettered capitalist economics, the doctrines of Friedman’s monetarist school, whom Hudson calls the “Chicago Boys”.

For classical economists the FIRE sector was unearned income, led by the capital gains of land rent and land price, what landlords made in their sleep, according to John Stuart Mill. In Friedman’s mythical world “there is no such thing as a free lunch”. Capitalism has nothing to do with grabbing free lunches, though it plainly does so, especially by perpetually discrediting the role of government as regulator, and selling off public assets on credit. Free lunch rentiers have economic victory when government regulators and economists are persuaded capital gains do not exist, and so do not need to be taxed, regulated or otherwise tamed. As the pious believer in Satan, Charles Baudelaire, told us:

The devil wins at the point where the world believes that he does not exist.

By “free market”, the Chicago Boys mean freeing the financial sector from all constraints. The classical economists’ idea was of freeing markets from rent and interest. One tenet common to our major traditional religions is opposition to the charging of interest!

  • Judaism called for Clean Slates (Leviticus 25)
  • Christianity banned interest outright, citing the laws of Exodus and Deuteronomy.

These old religions were laying down precepts for regulation, aiming to limit gross exploitation. The new one promotes deregulation, aiming to encourage it. The monetarist priests of the new religion have turned traditional Jewish and Christian morality on its head. The poor are not to be protected from the sharks but thrown to them.

Classical economists, men with a firmly Christian background, saw rent and interest as a relic of Europe’s feudal ownership of the land, and the privatization of money and finance. The leading universities were originally established to train men for the clergy. The teaching of economics as an academic discipline began in those Christian oriented universities in moral philosophy courses for those aspiring clergymen. Then moral philosophy evolved into political economy, dealing with economic reform and taxation of unearned income accruing to vested interests through legal privilege, all still with the implication of the need for business restraint to keep the poor from destitution.

In the twentieth century, the discipline was cut down to “economics” to separate it from its dangerous proximity to politics, and to distinguish productive from unproductive investment, earned income from unearned income, and value from price. The classicists aimed to tax away “unearned income” to regulate natural monopolies or shift them into the public domain. So, privatization of public enterprise, “freeing” markets from the usury laws and promoting deregulation is the antithesis of traditional religions, whose ostensible aims were to socialize their congregations and create a moral state. Needless to say, no history of economic thought like this will be taught at the Friedman Center.

The high tide of the Chicago Boys when Friedman’s economic doctrines first reached notoriety was in the Pinochet period in Chile. Given power after the 1973 military coup engineered by the US against Allende’s Marxist experiment in peaceful revolution, they immediately closed down every economics department in the country, and every social science department outside their own base at the Catholic University. For them, “free markets” for capital required total control of the educational curriculum, and of the cultural media—the opposite of freedom as conventionally understood, and as falsely propagated by the US propaganda machine. They could not have a “stable” free market—a market free for financial predators intended as donors to the UC’s Friedman Center—without a dictatorial authority, an inquisition.

Chicago School monetarists now have censorial power on the editorial boards of many refereed economics journals, publication in which is necessary for academic economists to have successful careers. So, the scope of economics is limited to their “free market” celebration of rational choice theory, and a narrow “law and economics” ideology contrary to moral justice and economic regulation, as we have seen, the stated bases of Western religion.

Even in the 1950s, the UC social science departments were extreme. Hudson reports that, at the UC Laboratory School he attended, a large banner was strung over the blackboard in a social science classroom, saying:

Give them all what the Rosenbergs got.

The Rosenbergs got the electric chair! Who would have anticipated that economics would end up more authoritarian, more explicitly opposed to the idea of human rights and distributive justice than theology? Or that the latter discipline itself would be so inverted from the aims of their founders? After the Freedom of Information Act opened up FBI files, the students read and laughed at the snooping surveyance reports their UC professors filed on them and their political views. But it is not at all funny. UC professors and those of its associated Shimer College were disciples of McCarthy’s rabid anti-communism yet acted identically to the propaganda image of the Stalinists in Eastern Europe.

The classical economists were reformers, seeking to free markets from the land rent of Europe’s hereditary aristocracies, their “free lunch”—unearned income—and from monopoly rents administered by the royal trading corporations created by European governments to pay off war debts. Now the Chicago monetarists seek to favor rentiers rather than the “real” economy of labor and capital, by deregulating monopolies and usury. Their focus is on financial and property claims on income and on assets pledged as collateral—bank loans, stocks and bonds—for which they urge tax cuts. And to increase the market for leveraged buyouts, the Chicago Boys, since Chile after 1973, advocate privatizing the public domain.

So what is inverted is not only the classical idea of free markets, but the economic core of early religion. Today, for the Chicago Boys, those most in need of salvation are high finance, real estate and monopolies in their fight to reverse seven centuries of classical economic reform since the 13th century when Churchmen debated how to define a socially necessary cost of production—a “Just Price”—for banks to charge.

Religions are always about fundraising, and the monetarist religion is no different. The University of Chicago was financed by John D Rockefeller, prompting Upton Sinclair in The Goose Step to call it “The University of Standard Oil”. And rewards! In 1961, Lawrence Kimpton who replaced Robert Hutchins as UC chancellor, became general manager of planning, and subsequently director, for Standard Oil of Indiana. Rockefeller at least gave something to “those in need”, whereas Milton Friedman is reported to have asked someone suggesting better public welfare and medical care, “Why do you want to subsidize the production of orphans and sick people?” Hardly the supposed American Christian spirit. But then Americans do not comprehend Christianity—“Blessed are the poor”. They think it is Friedmanite monetarism—Blessed are the rich!

Edited from Michael Hudson at Global Research online.

Written by mikemagee

1 August, 2010 at 8:45 pm

4 Responses

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  1. […] Blessed are the Rich: Monetarism and Christianity « Magi Mike’s Blog […]

  2. […] The devil wins at the point where the world believes that he does not exist. By free market, the Chicago Boys mean freeing the financial sector from all constraints. The classical economists’ idea was of freeing markets from rent … And to increase the market for leveraged buyouts, the Chicago Boys, since Chile after 1973, advocate privatizing the public domain. So what is inverted is not only the classical idea of free markets, but the economic core of early religion. …Click Here […]

  3. Hi, I discovered this blog once, then lost it. Took me forever to come back and discover it. I wanted to find out what comments you got. Good blog by the way.

    Car Cover

    6 August, 2010 at 6:28 am

  4. […] Blessed are the Rich: Monetarism and Christianity « Magi Mike's Blog […]

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