Review of “Theology and Economic Ethics: Martin Luther and Arthur Rich in Dialogue” by Sean Doherty

Sean Doherty, Theology and Economic Ethics: Martin Luther and Arthur Rich in Dialogue (Oxford: Oxford University Press, 2014), 228 pp.

Sean Doherty seeks to compare the pre-industrial age thinking in Martin Luther’s 1520 Sermon von dem Wucher (Sermon on Usury) with that of the modern era’s Arthur Rich, a Swiss systematic theologian and social ethicist whose two-volume magnum opus, Business and Economic Ethics: The Ethics of Economic Systems, was completed in 1990. Doherty’s aim is to present not so much a study in economic ethics but an understanding of the methods of these particular thinkers. The quick takeaway is that the reformer comes off with far more direct and real-world guidance to business practitioners than the ever circumspect Rich.

In the first chapter, Doherty explains Luther’s method as trying to first understand something correctly (that is, in the light of Scripture), in order to know how to act rightly with respect to it. The core of this method is to restate the absolute character of Jesus’ commands on the basis of an exegetical engagement with the original text. When Luther had an opinion, he expressed it, however harshly. He would address the injustices in society. When Luther saw merchants taking advantage of buyers, he’d call them out as Geytzige blassen (“greedy, bloated fellows”).

Doherty does well in his extensive coverage of Luther’s opposition to Zinskauf (which Luther also covers in his major economic writing, On Trade and Usury). A Zins was a fixed return provided to an investor with surplus funds who enters into an agreement with a merchant short of funds. The merchant uses the investor’s money to expand his business. Then, whatever amount the merchant’s future income exceeded the fixed Zins payment would become profit for the merchant. While such Zinskauf was not illegal, Luther’s Scripture-based perspective on usury and awareness of widespread abuses by lenders led him to condemn it. Today we may question Luther’s conclusions on interest and finance, but we can understand his biblical intentions expressed in what he called Nächstenliebe, the necessary love and care for those together with us in society, our fellow citizens, our neighbors. Of interest is that Luther’s analysis of Zinskauf demonstrates an implicit understanding of compound interest; remarkable, being that it’s a concept two-thirds of Americans still don’t understand five hundred years on.

The second chapter reviews Arthur Rich’s deep scholarship and survey of modern political and economic thought in a significant two-volume tome. However, Rich provides little guidance for real-world managers in business decisions, and his Wirtschaftsethik is a pedantic read. He goes so far as needing to explain the difference between “software” and “hardware” in computer science. To this reviewer, and perhaps too for Doherty, multa sed non multum (many things but not much). Doherty correctly criticizes Rich’s ethical relativism and frustrating aversion to taking any firm positions on normative behavior. It recalls the adage, “If you laid out all economists end to end, they’d still not reach a conclusion.” Though Rich set out to address business ethics, he himself admits that “[t]he specific questions of business management, which are of direct relevance primarily to the practitioner… are discussed at best marginally” (Rich, 267).

The third chapter summarizes Luther’s approach to addressing specific personal behavior in contrast to Rich’s talking broadly about economic orders. Doherty suggests that Rich is far too ready to take economics for granted as a morally neutral science and that Luther’s ostensibly more individual approach to ethics enables him to adopt far more socially radical conclusions than Rich. Doherty notes that the question Luther addresses is not, “What should society be like?” but rather “What should particular people in a particular office (such as soldier, merchant, prince) do?” Rather than concerning himself with improving the whole of society, Luther seems more modestly concerned. His goal is a pastoral one: the moral guidance and salvation of those in his care, and to alleviate the particular injustices which he sees before him.

Doherty says his “surprising discovery” is that less may be more in social ethics. While Luther lacks Rich’s grand design to make society as just as possible (a state that Rich defines with the vague term of optimum outcomes), Luther retains a laser focus on securing obedience to God’s commands which will do justice in society.

To conclude, the author has a fine familiarity with Luther and the breadth of economic writings that inform Rich’s work, no small achievement. The jacket of Doherty’s book notes, “In the wake of the financial crisis of 2008, few questions are more pressing than those around the ethics of finance and economics.” Doherty’s strong sections on Luther carry the book. However, both he and Arthur Rich could have done more to step outside the academy and provide guidance to practitioners. Many in business exhibit a utilitarian morality: as ethical business practices have a financial benefit, business therefore should be conducted ethically. This is of course shallow, and a Christian business ethic should be offered in its place, one that reflects Luther’s foundational approach of Nächstenliebe.

Doherty would do well to note the approach of CEO Indra Nooyi, who leads Pepsico to care about more than just profits; the focus is also on good corporate citizenship and how it operates to make those profits. This is in stark contrast to the managers of the now failed Lehman Brothers that helped crater the U.S. economy in 2008. Lehman was a place where greed and avarice prevailed with a pathetic lack of concern for Nächstenliebe. This is the reality of the financial crisis that Doherty mentions. As was his way, bombastic Luther would have called out the Lehman managers as Stuhlräuber (“seated thieves”). Economics and business can have a hard edge. If he were with us today, Luther would not be equivocating on the sidelines like Arthur Rich but right in the middle of the fray.

Christopher J. Nagel is Professor at the School of Business at Concordia University Irvine and author of the chapter “Luther on Trade and Commerce” in The Idea and Practice of a Christian University: A Lutheran Approach (Concordia, 2015).

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