Wealth and Poverty

Though one could argue that it is bad for business, it has been my habit of late to emphasize a rather simple point- that wisdom is rather simple. God has not hidden His Word, but revealed it, and anyone laboring in too many complexities to reveal it is, more likely than not, actually concealing it. If your exegesis of a passage ends up looking like one of those equations from Good Will Hunting, or A Beautiful Mind, you know the kind, where there are more letters (often Greek) than numbers and it takes up the whole chalkboard, then you’re probably doing it wrong.

The same is true about economics. The dismal science is neither dismal, nor a science. Rather, it is simple common sense. The way to prosperity is not complicated. You need not acquire specialized tools that are in high demand. What you need to do is to work hard, and to consume less than you produce. That is the way to wealth. The way to poverty is to be lazy, and to produce less than you consume. These two principles apply for the individual, the family, a business, a government and a nation. Here’s a simple corollary. If you find yourself behind the financial eight ball because you’ve been consuming more than you’ve been producing, consuming more won’t help the situation. Debt does not solve debt.

Foolishness, on the other hand, can be horribly complicated. Things got real ugly during the Carter administration, fiscally speaking, because the government had figured out a way to turn debt into more debt by turning it into money. They borrowed money, then borrowed on the IOU’s. That’s a rather expensive wind and smoke machine designed to tell us all with all the thundering majesty of the Wizard of Oz, “PAY NO ATTENTION TO THE DEBT BEHIND THE CURTAIN!!!” Which is precisely what we’re being told now. Prices are going up, not because businesses have gotten more greedy. They’ve gone up because the government has been printing more money like it’s going out of style. It’s not Putin’s fault. It is the fault of the United States government that has racked up a debt in the tens of trillions.

Smoke and mirrors will not change hard realities. And foolishness cannot defeat wisdom. Regular people like you and me have for too long thought we could borrow our way to prosperity. Your local bankers and mortgage brokers thought they could borrow their way to prosperity. The Gordon Gekkos who walk the caverns of Wall Street thought they could borrow their way to prosperity. The Beltway Bandits thought they could borrow their way to prosperity. The piper is at the door, waiting to get paid, from all of us.

What can you do in these complex and troubled times? The simple things. You can work hard. You can produce more than you consume. You can refuse to get caught up in all the foolishness. And you can teach your children to do the same.

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