Immorality of Inflation
By: Evil Inflation
Tags: Christianity, Inflation, Bitcoin, Inequality

Does God care about the economy of a nation? Is he interested in the systems of society or in his examination of the heart does he excuse people for the circumstances in which they were born? Everyone recognizes that the global economy does not provide equal opportunity to all people, but no one alive today was responsible for the creation of this economic reality right? Actually in a broad historical context, the western individual has unparalleled freedom and God does promise that he will hold individuals and nations accountable for the choices they make about trading, investing, and consuming in their economies. As we will see, inflation, or the systematic and intentional devaluing of a currency, is an abomination to the Lord because it coerces a manipulated standard measure of value, it enslaves the poor in a descending spiral of debt and inequality, and it facilitates government spending on morally objectionable policies. This is not an inescapable reality for the western religious person. We can make daily choices that tear at the fabric of this injustice and build new structures that provide greater fairness.

Jesus talked extensively about money and God gave the Israelites many commands in the Old Testament about how they were to conduct trade. In Leviticus 19:35 he says “You shall do no injustice in judgment, in measurement of length, weight, or volume. You shall have honest scales, honest weights, an honest ephah, and an honest hin: I am the LORD your God, who brought you out of the land of Egypt.” Later in Proverbs 11:1 God inspired Solomon to write, “The Lord detests dishonest scales, but accurate weights find favor with him.” Clearly, God’s instruction for us today is not about cheating our kids with an underserviced cup of chocolate chips in the first batch of cookies (or maybe it is😊). What God is saying is that standard by which we measure value should not change. Evil Israelite businessmen would carry different weights in their sacks to market so that at the right opportunity they could extract more value from their counterparty than the agreed price of the trade. Nowhere in the Bible does God mandate stable prices, in fact he seems to take great pleasure in the free trade of goods. When the prophet Isaiah speaks of the everlasting kingdom God will create one day, he says his people will bring him honor through trade returning to Zion with great profits.[i] Throughout the Bible, God has blessed many righteous people with wealth through their trade, but the manner in which they conduct their business is critically important to him.

Our current fiat monetary system enforces the use of fiat through legal tender laws and capital gains taxes while manipulating that money’s value in the government’s favor. Money is not a good to be consumed, but is in fact just an instrument to measure, store, and exchange the value created by labor. Anyone who possesses the power to create money effectively reserves the right to change the scales at any moment post transaction. All money is amoral. It is the use of money that is important to God, and the intentional manipulation of inflation is contradictory to Biblical commands (see Amos 8:4–6[ii], Amos 5:11–12[iii], Proverbs 20:10[iv]). It is irrelevant at this point that inflation-financed expenditures may be intended to assist the individuals who exchanged value. The point is that the standard by which they valued their labor was changed without their consent or full understanding to their detriment. They were effectively cheated by the creators of money. You may agree that inflation unjustly steals value from people, but perhaps you might argue that the benefits of government spending and the resulting social programs restore more balance to an unjust system than freedom possibly could.

Richard Cantillon was an Irish-Frenchman who addressed this very question in the 18th century. His principle states that money that is subject to government inflation is non-neutral and benefits those closest to the source of the new money more than those lower in the economic strata. The bankers and stock investors with the closest access to the 0% Fed interest rates can buy stock and other financial instruments with the new money thus propelling it out into the economy. The lower-class wage earners will see prices rise for the goods and services they purchase long before their wages start to rise. This phenomenon is known as friction. To survive the onslaught of inflation many of them take on credit card and pay-day loan debt at interest rates astronomically higher than those available to the wealthy. Do we need any further proof of the Cantillon Effect than a stock market hitting all-time highs coincident with near all-time highs in unemployment? What about the levels of campaign funding spent at the federal level (the source of monetary creation) compared to the aggregate of those for local elections? Primary dealer and accredited investor statuses have only enforced this injustice. Reference the below charts that indicate that the impact of inflation on the inequality in America is far greater than a “2%” pricing power loss to all citizens. James is clear is in message in chapter 2 about giving preferential treatment to the wealthy: “But if you show favoritism, you sin and are convicted by the law as lawbreakers.”

The Gini Coefficient is a measure of wealth inequality

Inflation is not only morally reprehensible in the manipulation of value standards and in the resulting inequality, but also objectionable in the purposes that it finances. Without the fiscal restraint of the natural laws of chemistry, gravity, or mathematics; governments do not require broad consensus for the approval of most budgetary spending. In fact, the entire system incentivizes the inclusion of as much pork barrel spending in each piece of legislation as is necessary to ensure its passage. Many Christians would never fathom giving their own money to support abortion clinics, foreign wars, or corporate bailouts for the wealthy; but the continual indifference or support for the inflationary policies of their own currency does exactly that. The Lord promises in Isaiah 10 that he is not indifferent to immoral spending. [v]

As Christians, we must obey the Biblical command to ensure that our financial system provides a fair value standard whose supply is governed by natural laws, that releases the poor from the bonds of debt slavery through an accessible store of value, and that curbs the Christian financing of immoral practices. We can do this most effectively by carefully choosing where we save and invest our money. There are many forms of money today in the world and not all of them are effective stores of value. We must remember that apparent security of one form over another does not imply moral superiority. Choosing to risk security for the sake of justice is terrifying for most people, particularly me. I write this article as a moral challenge to myself, someone who has benefitted from the injustice of inflation all his life. Finally, it is interesting to note that downfall of most kingdoms throughout history has coincided with the greatest rises in inflation. Can we escape God’s judgment if we do not commit today to use just scales?

[i] Surely the islands look to me; in the lead are the ships of Tarshish, bringing your children from afar, with their silver and gold, to the honor of the Lord your God”

[ii] Hear this, you who trample on the needy and bring the poor of the land to an end, saying, “When will the new moon be over, that we may sell grain? And the Sabbath, that we may offer wheat for sale,

that we may make the ephah small and the shekel[d] great and deal deceitfully with false balances,that we may buy the poor for silve and the needy for a pair of sandals and sell the chaff of the wheat?”

[iii] You trample the poor, stealing their grain through taxes and unfair rent. Therefore, though you build beautiful stone houses, you will never live in them. Though you plant lush vineyards, you will never drink wine from them. For I know the vast number of your sins and the depth of your rebellions. You oppress good people by taking bribes and deprive the poor of justice in the courts.

[iv] Unequal weights and unequal measures are both alike an abomination to the Lord.

[v] Woe to those who make unjust laws, to those who issue oppressive decrees, 2 to deprive the poor of their rights and withhold justice from the oppressed of my people, making widows their prey and robbing the fatherless. 3 What will you do on the day of reckoning, when disaster comes from afar? To whom will you run for help? Where will you leave your riches? 4 Nothing will remain but to cringe among the captives or fall among the slain. Yet for all this, his anger is not turned away, his hand is still upraised.