God, Man, and Money, or How to Succeed in Business
Without Going to Hell
Barter is undoubtedly the most primitive form of human exchange, and there
seems to be something wholesome about it. As long as most people were hunters
and gatherers, fishermen and farmers, the goods and services they exchanged
seemed "natural" and "basic." Obviously, the subjective
factor of a powerful lust for a particular object could lead to an exchange
that calmer and more judicious observers would judge as grossly one-sided:
the person with the stronger desire might give away goods worth far more
than the object of his desire. The native Americans are said to have "sold"
all of Manhattan Island to the first European settlers for strings of bright
beads; although of course the joke may have been on the Europeans, because
Native Americans made no pretense of "owning" anything, and may
have felt they got something rare in their world for something overabundantlandand
by nature belonging to all.
The invention of money as a medium of exchange was an enormously helpful
social invention. In the beginning, however, money was scarce and the temptation
to hoard itas in the fairy tales of misers "in their counting
houses counting up their money"was apparently powerful. In those
days, those who hoarded a scarce resource deprived others of its use. Thus,
misers were universally regarded as villainous, even evil, and "avarice"
seemed to be a particularly vicious sin against the whole society. It did
not harm merely the miser, as overeating harmed the glutton; it hurt all
those into whose lives it brought deprivation. In those days, "wealth"
[understood as pecunia, gold or silver coin] implied a zero-sum game. If
one person had all, others had zero. Any money one person had subtracted
from the sum available to others. To possess an excess, more than one needed,
felt to the miser or the avaricious man like security, power, and prestige.
Many of the parables of Jesus remind such persons that in wealth of this
sort lies no real security, or peace, or virtue.
There was one other feature to pre-modern times. Land was the main cause
of wealth, and agriculture and agricultural productsincluding cloth
of various kindswere the main goods of trade. Artisans worked in metals
and leathers and woods. Yet on the whole there was relatively little invention
and manufacture of new products. With few exceptions, such as the manufacture
of instruments of war, including warships, in the employ of the king, modern
institutions such as factories and the division of labor had few precursors.
Thus, money was almost entirely a medium of exchange. It had very little
role as investment capitalas a social instrument for the creation
of new wealth for the whole society through sustained invention and discovery.
In short, the role of money as an instrument of the creative human mind
did not really emerge until modern times, at least in sufficient density
to lend a new character to the era. Until that happened, the only real way
for a king or a baron or even a brigand to acquire new wealth was to mount
up an army and go seize it. No one knew how to "create" wealth
or cause "development" (as we say today), but only how to "take"
wealth. Getting wealthy was often a matter of seizing the property of others
by force. Wealthy people lived in fortresses and castles to protect themselves.
"Wealth" in the sense of takings meant more than money, of course.
It meant silver cups and armor and linens and jewels and fine garments;
it meant tapestries and horses and cutlery and movables of all sorts. But
it also meant the capture of hoards of silver and gold. In this context,
to speak of wealth was often to speak of ill-gotten gains. To say that "money
is the root of all evil" or, even more exactly, "cupiditas radix
malorum," was not far from looking at the behavior of the powerful
as the peasants and yeoman who suffered most from mayhem, plunder, war and
rapine must have looked at it. Wars of plunder were the curse of Europe
(and much of the rest of the world) for some two thousand years, at least.
Even in the Old Testament one finds plenty of tales of conquering armies
sweeping out of the plains.
Not until 1776 did any major thinker raise the question of wealth in a systematic
and practical way, with an eye toward shifting the worlds attention
from warfare to investment, from the taking of existing wealth to the creation
of new wealth. No one before Adam Smith asked about the cause of the wealth
of nations. The conventional wisdom held that wealth is given and taken
away, as in good years and bad years, years of plenty and years of famine,
and that nothing at allexcept almscan be done to alter the permanent
condition of the poor majority. "The poor ye shall always have with
you." Even in the nineteenth century, Abraham Lincoln, who had been
born among them, said: "God must especially love the poor, He made
so many of them." It was Adam Smiths dream to understand the
causes of wealth, so that new wealth might be created in a sustained and
systematic way until every last person on earth was lifted out of poverty,
and all might live in "universal affluence."
In the first fifty pages of his flawed but revolutionary Inquiry into
the Nature and Causes of the Wealth of Nations, Smith recounts the invention
of the pin machine. Until someone invented that machine, it took two artisans
many days of close work to fashion one or two suitable pins. With the machine,
one many alone could press out many thousands of perfect pins in a week.
The inventor of the machine, in effect, created immense new wealth, and
made it possible not only for baronesses and duchesses to afford pins, but
also their servant girls and peasant women in the countryside. This insight
is reflected in Centesimus Annus, where the Pope points out that
while, in the ancient world, land was the most important form of wealth,
in our time invention, discovery, knowledge, and know-how have become the
new cause of the wealth of nations, "and the wealth of the developed
world is mainly of this sort." (no. 32) It is important to be as precise
as CA here: It is not "capital" in the sense of machinery, as
in Marxist thought, but "capital" in the sense of human skill
and knowledge and innovation that is the main generator of wealth today.
In short, human capital.
In a famous speech, Abraham Lincoln pointed out that the historical turning
point in this respect was the Patent and Copyright Clause of the U.S. Constitution,
the only clause in the body of the Constitution proper (in 1787, before
the Bill of Rights was added four years later) to use the word "right."
This clause elevated this new cause of wealth to the status of constitutional
law and thereby gave new significance to the term "property."
By recognizing "the right of authors and inventors," for a limited
time, to the fruit of their own creations, this Constitution generated a
new form of property, emanating from the creative human spirit, that would
in time surpass land in its ability to create new wealth. This new form
of wealth is, in the first place, in the form of ideas, ideas that "reduce
to practice" some practical device for the improvement of everyday
human life. (Lincoln himself filed for, and won, at least one patentfor
a new and superior form of water buoy.) Practically all business corporations
in the United States today are built around a creative new idea for a good
or a service; most such goods and services did not even exist, were not
even dreamt of, when the Patent Law was voted on. Lincoln foresaw this dramatic,
transformative potential. [I have described Lincolns reasoning in
The Fire of Invention (1997).]
It is instructive to note that whereas the figure of the miser was a stock
figure in novels and short stories and fables from early times until the
middle of the last century, this figure has virtually disappeared. Why is
this? In the old days, when money had virtually no creative use as investment
for innovation and discovery, anyone who hoarded money was a villain, subtracting
financial liquidity from the scarce public store. Today such a personpiling
up his money in an attic strong-room would be less a villain than a fool.
What good is money that is sitting still? A wise man would invest it in
a reasonable, safe, creative project, and perhaps use a smaller portion
of it in riskier projects that may or may not work out, but promise larger
rewards if they do. Today, for example, there are all sorts of investment
opportunities in fiber optics, cellular and satellite technologies, internet
services, revolutionary software, and smaller and swifter and more efficient
computer hardware. Without investors, these new technologies would never
be tried. Investment is the waterfall that moves the mill of innovation.
(More than half of all the risk capital invested in innovation in the world
today is raised and spent in the United States, under the protection of
the Patent and Copyright clause.) Money, in the sense of investment capital,
is a new handmaiden of the creative human spirit, the investment capital
that enables human capital to flourish.
One consequence of this transformation is that today we see more clearly
than ever that the most important resource in any nation is the creative
minds of its own citizens. This resource is not only renewable, but (as
Aristotle said) in some sense without limit: The mind is in some way all
things. It is open, questing, always probing and asking questions.
This insight transforms arguments about population control. It is false
that crowded or "overpopulated" countries must be poor, and underpopulated
countries are more likely to be rich. In fact, some of the most densely
populated regions of the worldJapan, the Netherlandsare among
the wealthiest. The main cause of wealth is the training and the organization
of the human mind. This factor is even more important than natural resources.
The Swiss have few natural resources, but a great concentration of intelligent
application. Some of the regions of the world richest in resources remain
mired in great human poverty. This phenomenon is almost always related to
the maleducation or malorganization of human capitalthe neglect of
education and proper laws and proper incentives.
If in a country such as Bolivia a thousand pigs are born, an old-fashioned
economist might say that this expands the per capita income, while if a
thousand human babies are born, this is bad for economic growth, because
one thousand more mouths to feed lowers the per capita income. But human
babies are not just open mouths, consuming more than they create. Each is
born in the image of the Creator, and each is endowed by God with the capacity
to create more wealth in his or her lifetime than he or she consumes. This
is the very condition for human progress. Unless it were so, human progress
would not be possible, let alone likely. Everything depends, of course,
on whether the economic system in Bolivia (or any other country) nourishes,
or represses, the creative capacities of each child. Bolivias greatest
resource is each child. Everything depends on wise investments (education,
training, morals, good laws, etc.) in those childrenin the human capital
of Bolivia, in the technical language of contemporary economics [Cf. Gary
There is one more point that must be made before we reach our conclusions.
If you purchase new software for your computer todayWordPerfect, for
exampleyou may pay (say) about $90.00 for the computer disc. You will
then become aware that the material elements of your purchasethe silicon
of the chip, the alloy of the discis worth less than one dollar. What
you are paying for is predominantly spiritual, the intellectual content
embedded in the software codes miniaturized on the chip. Goods today tend
to become smaller, miniaturized, cleaner, and more spiritual, less material
by far than fifty or one hundred years ago. Factories and workstations are
cleaner now, too, as electronic processes replace mechanical.
Something similar is happening to money. In the United States, it has not
been necessary to use silver or gold in daily life for many generations.
Paper currencies, backed "by the full faith and credit of the United
States Government," are in fact promissory notes that pledge convertibility
into silver or gold. This is mostly a matter of faith. It is a not unreasonable
faith. But it is certainly a promise of things hoped for more than a visible
More impressively still, less and less is it necessary these days to carry
even paper currency around in ones pocket. One carries neither silver
nor goldnor paper promises of same. Instead, one carries a "credit
card" or "debit card" linked by computer code to a bank account.
The form of wealth in ones pocket is a form of faith in the reliability
of computers and in a purely human (and fallible) institution, a bank. Money
today is mostly an account, a set of computer numbers always rapidly changing
with entries and withdrawals (and occasionally a computer error or a mistaken
manual entry by a computer clerk). Money has become more of an intellectual
artifact than a physical thing. Moreover, to an extraordinarily high degree,
its current value is based on spiritual attitudes such as faith and trust.
Burst these like a pin prick in a bubble and the value of money can collapse
very quickly. Consult the Asian crisis of early 1998, or the collapse of
the Russian ruble.
These two examples, Asia and Russia, indicate that more is involved in the
value of money held on accounts these days than purely economic factors.
In Asia, the lack of truly democratic accountability, the lack of transparency,
the phenomenon of one-party rule and the rewarding by political authorities
of relatives and cronies, and severe problems of transition upon the death
of dictators, and other chiefly political factors undermined confidence
in economic transactions. Too many unseen hands manipulate economic factors
beneath the table. Imputed valuations collapsed.
In Russia, the repression of all religious and moral inspirations during
seventy long years of Communist Party rule deeply injured the moral ethos
of the nation, and the failure of the political system after 1991 to establish
the rule of law; to suppress violence, extortion, murder, and gangsterism;
and to tie the value of money to real and universally dispersed assets,
gravely wounded trust in normal economic life. As Centesimus Annus
points out (no. 42), to work for true human liberty, an economic system
requires both a constitutional political system and a moral/ cultural system
that protect human liberty, too. Without a supportive political system and
a wisely shaped moral ethos, a creative and orderly economic life is not
possible. Economics does not live by economics alone.
All these complex considerations lead us to the reflection that "money"
today is a far more profound and spiritual concept than we would have thought,
even fifty years ago. It is worth no more than the faith people put in it.
That faith depends on political factors, moral factors, and cultural factors
(such as the quality of education and the high, or low, standard of morals
and mores). The work ethic that has become a tradition in Japanese families
over the past six or seven generations, for example, is of very great economic
value, even though it seems far remote from "money," and its continuing
vitality is a source of realistic hope for the recovery of the Japanese
economy and the renewed strength of the yen. Let me add to that the relatively
new concentration of the Japanese upon sustained innovation.
In Italy, too, ancient habits of enterprise and economic creativity, especially
in small and mid-sized firms, is making Italy one of the top two or three
nations in Europe in terms of entrepreneurial vitality and innovation. The
cultivation of creativity in Italian schools, not least aesthetic creativity,
gives Italian products a distinguishing flair that most of the world finds
attractive. Behind currencies, in short, lie entire ways of life, replete
with moral, spiritual, and psychological habits of infinite variety.
In Europe, the Euro is an attempt to enforce a certain continent-wide common
economic discipline, while reaching for the rewards of more efficient international
accounting transactions. Reflection on the Euro brings out even further
the new level of moral and spiritual common life for which Europe is now
reaching. Money and spirit, or at least money and deeply rooted human habits
and acts, are far more tightly interlinked than we have heretofore thought.
Preachers, therefore, need to be intellectually careful in speaking about
"materialism." The more common vices today are likely to be spiritual:
preoccupation, hyperactivity, a failure even to heed the natural rhythms
of the body and the senses, distractedness, an instrumentalizing of people
and time and activity. Ironically, many people today need to slow up a little
and smell the roses, enjoy the sunshine, go slowly over a good meal, pay
real but relaxed attention in conversations, make more space for their contemplative
instincts and all these things might seem to be a kind of self-pampering,
a form of self-indulgence, even a preoccupation with material pleasures.
But their real point is to heal our spirits, which a fast modern life too
much mortifies. Living life by the wrist watch and an electronic bombardment
of messages and a daily rush through "fast food" outlets can be
a mortification of the flesh that would have taxed a Desert Father, and
thrown him exhausted into his prayers.
Besides, it is my experience that more people today are led to God by the
emptiness they find in success than through being broken by hard experiencesalthough,
of course, the ways to God are infinite, and there is no shortage of the
latter. Just when they attain what they always dreamed of, when they get
to the position they have long worked for, they find themselves restless
and unsatisfied. They ask themselvestell themselves "There
must be more than this!" It really is true that humans do not live
by bread alone. Those who find an abundance of bread quickly taste boredom.
Finally, I must answer one question I am always asked. "Isnt
it idolatrous that on the dollar bill and on some U.S. coins it is written
In God we trust?" Actually, that inscription is actually
a reflection of a profoundly American belief in original sin. The American
experiment in self-government is no utopian or rationalistic experiment.
We know that every human being without exception sometimes sins. When we
say, therefore, "In God we trust," what we really mean, operationally,
is: "In nobody else. For everybody else there are checks and balances."
Executive power is checked by legislative and judicial, and each of those
also by the other two, and all other offices in the Republic are also divided,
so that the interests of each part become a sentinel over the ambitions
of the other. In other words, "In God we trust" is an expression
of biblical realism.
Perhaps this seems quaint to Europeans, I grant that. But maybe it is not
a bad thing to say even on paper money that our trust is not in it, that
even its value depends on multiple factors of the human spirit and human
practice, and that it, too, rests on many kinds of checks and balances.
Money is a far more complicated realityand more tightly related to
matters of the spiritthan we usually recognize.
It is useful to meditate on the humble realities of daily life. They all
do, in the end, lift the mind to God, dont they?
[This article originally appeared in the May/June 1999 issue of Catholic
Novak holds the George Frederick Jewett Chair for Religion and Public
Policy at the American Enterprise Institute, and was awarded the 1994 Templeton
Laureate for Progress in Religion. Many of his columns and articles can
be read on his website,
This article previously appeared in an Italian publication, Nuntium,