How Conservative Politicians Wait for God to Fix the Economy, With Frightening Results

The theology embraced by American religious conservatives may render them immune to evidence and reason when it comes to economic management.

Is it merely partisan politics and the misguided ideology of "austerity" that leads conservatives to reject commonsense fixes for this miserable economy? Or is something else going on?

It may well be the latter. A study released last fall suggests that the theology embraced by American religious conservatives may render them immune to evidence and reason when it comes to economic management. The study found that a sizable minority share a uniquely faith-based view of how the economy functions, believing that both good and bad outcomes are an expression of God's will, and are therefore beyond the reach of mere mortals.

This may help explain the disconnect between the gravity of our economic crisis and lawmakers' – especially conservative lawmakers' -- decided lack of a sense of urgency in addressing it. Consider for a moment three related facts that, taken together, cast what appears to be the sheer madness of our nation's economic stewardship in sharp relief.

First, we have an “infrastructure gap” of over $2 trillion. According to a report by the American Society of Civil Engineers, the nation’s “deteriorating surface transportation infrastructure,” if not upgraded, “will cost the American economy more than 876,000 jobs, and suppress the growth of the country’s Gross Domestic Product by $897 billion by 2020.” That doesn't speak to energy or communications infrastructure – just roads and bridges and the like. 

Second, the construction industry was absolutely devastated by the bursting housing bubble. While the overall unemployment rate hovers around 9 percent, it's still at 13.5 percent for construction workers. The Architechtural Record estimated that 20-30 percent of the nation's architects were jobless as of last fall.

Finally, in effect, investors are now willing to pay the United States government to lend it money. That's right, after factoring in inflation, the real interest the government must pay on five- and seven-year bonds is currently in negative territory.

So we face a huge gap between our potential and actual output. People and equipment are standing idle, we have deteriorating infrastructure which, if left unrepared, the civil engineers tell us will cost the average American household $1,600 per year in higher prices and lower incomes, and the government has access to what is essentially free money to repair it -- a move that would get a lot of unemployed people back to work in the process.

Within the reality-based community, this situation represents a true no-brainer. As economist Dean Baker writes, “We know how to get out of this mess, we have known how for 70 years. We just need the government to generate demand. That means spending money."

But, according to the study -- commissioned by Baylor University, the National Science Foundation and the John Templeton Foundation -- only about one in five Americans adhere to a purely secular view of the economy. Almost three in four say, "I know God has a plan for me," and within that group, about half believe the government is “trying to do too many things” that should be left to the private sector, eight in 10 believe "able-bodied people who are out of work shouldn't receive unemployment checks” and more than 90 percent believe in the myth that the American economy represents a pure meritocracy in which people are limited only by their innate talents and appettite for hard work.

Within that larger group is a subset representing about 20 percent of the population who, as USA Today reporter Cathy Lynn Grossman put it, “combine a view of God as actively engaged in the daily workings of the world with an economic conservative view that opposes government regulation and champions the free market as a matter of faith.” Sociologist Paul Froese, co-author of the Baylor study, told USA Today, "They think the economy works because God wants it to work. It's a new religious economic idealism," with politicians "invoking God while chanting 'less government'."

According to Froese, the belief represents a cognitive barrier to assimilating worldly economic research. Over eight in 10 political conservatives surveyed thought there was one "ultimate truth in the world, and new economic information of cost-benefit analysis is not going to change their mind about how the economy should work," he said. That's consistent with other findings; a study conducted in 2009 by the Pew Forum on Religion and Public Life found that “the most devout are on average least willing to accept the evidence of reality.”

The researchers found that another 20 percent or so take a purely secular view of the economy, and they arrive at a very different view. Because they don't see the hand of God guiding our economic outcomes, they tend to be more likely to favor policies that result in less income inequality – a robust safety net, taxing the wealthy and corporations and other measures an earthly government can undertake.

This is not to suggest that worldly-minded anti-governmentalism doesn't still obtain or isn't keeping us mired in the Tea Partiers' “austerity recession.” But there is a difference between seeing the “hidden hand of the market” guiding our economy and the hidden hand of God. At least believers in Adam Smith's famous formulation are amenable to the government stepping in to correct market failures. The latter are embracing a truly dangerous fatalism. It's fine to say, “insha'Allah” before boarding an airplane, but leaving it all up to divine will rather than skilled aircraft mechanics is a formula for some frighteningly unsafe flights.

I recently wrote a piece considering whether modern American “conservatism” has become more of a religion than an ideology – a set of fixed beliefs that can't be moved just because objective reality contradicts them. The Baylor study offers an economic angle at the question. The authors concluded that this belief system represents “a distinctly American cultural finding” that is “specific to this point in history.”

Faith-based economics can have a pernicious effect on our recovery, and not only because it leads politicians down a path toward painful spending cuts at the wost possible time. It also hurts because, as New York Times economic reporter Catherine Rampell notes, “in order for government policy to be effective, people must believe it will be effective.”

Part of the reason that economic stimulus works is that it gives consumers and businesses confidence that the economy will improve. That belief becomes self-fulfilling as they feel more comfortable increasing their purchases and investments.

Likewise, if Americans believe that Congress cannot be counted upon to do anything that will help the economy, nothing that Congress does — no matter how well designed and well executed — will succeed in helping the economy. Perception matters.

Now consider a huge disconnect between common perceptions and the economic data. While there is something approaching a consensus among the experts that the 2009 stimulus bill saved somewhere in the neighborhood of 3 million American jobs (although the precise figures are subject to plenty of debate), a recent Washington Post poll found that almost three-quarters of those surveyed believed the government can "do little or nothing to solve the nation's economic problems.”

That divide is by and large based on economic illiteracy and the ideologically informed view that government is bad by definition -- and by partisan animus -- but among a subset of the population, it's also an article of religious dogma.

The tragedy is that, like some other religious beliefs (that women should be subservient to abusive husbands, or that condoms don't prevent the spread of AIDS), to the extent that it distorts our view of what's happening in the “kingdom of man,” it can lead to a lot of needless real-world pain.

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