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Environmental sustainability is a central challenge for humanity. In areas of the United Kingdom water has been rationed in two of the last four years, partly because we have not managed to build a major reservoir for over 30 years. Not only greenfield, but also brownfield land on which housing could be built to ease our chronic shortage lies undeveloped. Fish stocks in some important species have dropped to dangerously low levels with high government-set catch levels aiming partly to preserve the UK’s fishing fleet. The carbon emissions strategy pursued by all recent governments has put the goal of achieving net zero by 2050 within reach, albeit at considerable, but perhaps now reducing, cost.
The first fruits of CEME’s programme on the economics and ethics of the sustainability challenge are published today. Markets and the Environment, by our Senior Research Fellow, Dr John Kroencke, considers what economic theory and the history of environmental policy tell us.
If we accurately grasp the scale of the challenge, we will immediately have strong feelings. One reason is that, once the fragility of the ecosystems in which we live is exposed, we see how precious they are. In Christian ethics we express this by saying that humankind and the world in which we live our earthly lives is part of a single created order, which the Creator lovingly holds in being. In the poetry of Genesis 1, God saw all that he had made, and it was very good.
A second reason is that sustainability challenges give us an insight into our own mortality and limitedness. In the earthier imagery of Genesis 2, our earthly bodies are of the same stuff as the dust of the earth. In that sense dust we are, and to dust we shall return.
A third reason is that we see stark trade-offs. The goods of conserving or regenerating ecosystems appear to conflict with other social goods. That is certainly a feature of all the UK challenges mentioned above. In these trade-offs we seem to face a certain loss, either of one kind of good, or of the other. We fear these losses in prospect. When they happen, they grieve us.
These strong feelings can lead us into one of two unhelpful responses. The first could be called environmental absolutism. We all feel that sometimes. Looking at some part of the planet, which particularly strikes us at that moment in all its preciousness and fragility, we have what seems like a moment of moral clarity. We can make no trade-offs. The very idea of cost-benefit analysis seems out of place. ‘Conserve or regenerate this at all costs,’ we feel, ‘and let the heavens fall.’
Yet we do have to make trade-offs, not only between environmental and other social goals, but even between different environmental goals. So we need not only moments of moral clarity, but also a worked through ethics and theology which is integrated with, not insulated from, economic thought.
Another unhelpful response is at the other extreme: what could be called laissez-faire fatalism. I suspect we all have moments of that too. It’s just too difficult, we feel, to work out these difficult trade-offs. If we try, there will be too much conflict, too much ‘politics’. Or, in a different version, the costs of environmental protection seem just too vast to contemplate: intuitively ‘it is just not worth it’. Surely ‘the market’, if left to itself, can work it out. Or can’t the economists just make the problem go away?
But that response will not work either. When we talk to economists about ‘leaving it to the market’, or indeed to them, they will first tell us that the losses in value caused by environmental harm will be in many cases far higher than the potential gains from the activities that cause it. They will tell us also about externalities and market failures. They will be disinclined to tell us what our environmental goals should be, and instead offer us efficient ways to achieve goals which we put to them.
They will also tell us that this kind of fatalism risks legitimising positions which have nothing to do with economics at all, but are rather forms of political posturing and the instrumentalisation of environmental policy for a broader ‘culture war’. This is one way one could see the 2024 manifesto pledge of the Reform Party to axe the UK’s Net Zero target, or the pause on renewable energy projects on federal land in the US. Economists can help us to get the economics right, but only if the politics and ethics of the debate permit that.
Once we accept that we need to think both economically and ethically, we then need to avoid two mistakes in how we do so. The first could be described as market-phobic. It is markets, some might say, which have created these problems. Do we not all agree that environmental goods are often public goods? Do they not often function as externalities to markets in other goods, which therefore inevitably fail to value them? Should we not then use market mechanisms as little as possible in addressing them? Should we not look instead to decisions by politicians and government officials to design the necessary actions, such as reductions in pollutants or emissions, and command and enforce them through the coercive power of the state?
The problem with this response is that it both exaggerates the ability of the state to do this with any efficiency, and overlooks the potential gains from well-shaped markets. A well-shaped market will harness large amounts of real-time information, even as that remains decentralised. It will summarise this in the rich, responsive information of price signals. These will enable diverse and dispersed individuals and groups to align their voluntary actions. By preserving existing property rights, or generating new ones, it will provide incentives for enterprise and innovation.
This type of potential has often been lost due to crude regulation, such as: opposition to zonal pricing for energy; regulated prices for water use; and the failure to develop more than an embryonic market in credits for nutrient run-off caused by much-needed house building. On the other hand the extraordinary growth of solar energy generation in Texas, stereotypically a place of ‘cowboy’ spirit and free-market principles, illustrates the power of a well-shaped market.
A second mistaken response could be described as market-fundamentalist. Have we not learned from other sectors of the economy, others might say, of the perils of government control of economic activities? Do we not know the challenges of intermittent, centralised decision-making, and the likelihood of political capture of the process? Therefore a market solution is always to be favoured. The role of government should be as limited as possible, shaping a market with the largest possible scope, and leaving it to run.
The problem with this response is that it confuses a general, ideological claim with a specific, empirical one. Ideologically one can believe that markets generally have great benefits, while at the same time insisting on the need to consider what institutional arrangements will in fact best address each specific environmental challenge.
A better way than these is suggested by the insights which won Ronald Coase a Nobel Prize in Economics. These are considered by John in Chapter 2 of his report. If we consider the relative merits of addressing an environmental challenge through governmental command and control, or through community-based self-governance, or through a market system, this should be seen as a choice between institutional arrangements.
The relative efficiency of these depends in large part on what economists call transaction costs. Coase’s contribution was to emphasise their significance. They include costs: to gather information about needs, counterparties, costs and prices; to establish property rights, whether over fish or water; to draw up, negotiate, monitor and enforce agreements; and to resolve disputes. These costs exist in all kinds of institutional arrangements, but in different patterns.
In Chapter 3 John develops Coase’s insight and applies it to environmental regulation. Since the pattern of transaction costs differs in each context, different institutional arrangements will be superior in different contexts. The arrangement selected can best be seen as an emergent solution to a specific environmental problem.
This has implications for business-people. Sometimes they fear they will be perceived as complicating political solutions designed to cut-through and connect with the strong feelings mentioned at the outset. But John’s report implies that a more complex and nuanced debate is likely to be in the public interest. There is no substitute for close, comparative analysis. We need to relinquish the doctrinaire stances through which someone might try to short-circuit decision-making by, for example, putting trust always in the state, or always in an impersonally and abstractly conceived market.
At other times business-people fear that policy-makers or the public will see them as advocating for market solutions only because they suit them. Coase’s thought yields a framework for policymakers and citizens to distinguish proposals which offer efficient solutions, from narrowly self-interested arguments. This enables the formation of the durable coalitions needed to support long term investments. For example, on nutrient neutrality a well-designed market overcoming barriers to win-win trades between existing polluters and homebuilders could attract broad support.
The need is for a real-world approach which keeps initial assumptions down, takes the trouble to understand the context without pre-emptively ruling anything in or out, and prioritises arrangements which best promote flourishing and welfare.
That allows the re-integration of economics with ethics. It certainly introduces an ‘anthropological’ element. In choosing between state, community or market solutions we will need to attend to what kind of state, community or market will in practice exist. That will depend in part on what kind of people are making decisions in the state, community or market, and how they relate to one another.
As Christians we have particular insights to offer. The impossibility of outsourcing our personal ethical responsibilities wholly to state or market arises from the irreducibly personal call God makes on our lives. Each of us must respond to the call to follow the way of Christ. We have each been given a will and a mind. With these comes the ability to make our own decisions – and an accountability for them.
The primary commitment to the welfare of our neighbours, rather than to any form of ideology, including economic ideology, is seen in the command to God’s exiled people to attend to their context and to work to improve it: to ‘seek the welfare of the city where I have sent you… and pray to the Lord on its behalf’ (Jeremiah 29.7). Indeed our cities in all their diversity do need our prayers – as does the City and its economic and commercial institutions – as well as our government and other communities.
We know that markets work, but also that they work in different ways in different contexts. Perhaps it’s time for some of us to stand up as ‘Christian Coaseans’, committed to tackling environmental challenges, and committed also to the hard work of comparing solutions and championing the most effective.
Revd. Dr. Philip Krinks is the Director of CEME.
The Centre for Enterprise, Markets and Ethics was pleased to hold an event on 13 November 2025
Bishop of Oxford’s Office and the Church of England’s specialist on AI and tech within the Faith and Public Life Team
Tech Entrepreneur
It has been reported that executives within the motor industry have expressed frustration at the Chancellor’s intention to end the provision of luxury cars through the Motability scheme, which assists those in receipt of disability benefits with funding to lease a new vehicle. Motability itself is a private company and accounts for about a fifth of sales of new cars in the UK, last year having spent £2.8 billion in the provision of vehicles for about 815,000 users. Of the 700,000 vehicles that constitute Motability’s stock, around 50,000 are considered luxury brands, such as BMW, Audi or Mercedes-Benz. In addition to removing luxury vehicles – defended by Motability as representing only seven per cent of its offering – the government is considering other reforms, including reducing the tax breaks available through the scheme, such as exemptions from VAT and insurance premium tax.
While Motability itself has pledged to crack down on potential abuse of the scheme, figures from within the motor industry have criticised the possible reforms. They argue that reform will reduce the size of the market for new cars, increase prices, deter investment, cost jobs and reduce the number of vehicles subsequently moving into the used car market, with knock-on implications for pricing. In addition, it is claimed, the planned changes will affect social mobility and cost the Treasury revenue.
The two latter claims have arguably been addressed. On the matter of tax revenue, it has been estimated that ending the tax relief on Motability vehicles will save the Exchequer over £1 billion per year. With regard to the question of social mobility, a reformed scheme would still deliver that. As the Transport Secretary indicated in a recent radio interview, the government considers the scheme to provide important support for those with mobility needs and believes that it should continue to do so. At issue, therefore, according to a Treasury official, is the question of whether the scheme has lost sight of its original purpose and whether, by providing premium vehicles rather than essential transport, it is making good use of public money. As such, the government’s concern is essentially with matters of fairness.
The other concerns raised by industry figures – concerning jobs, investment, prices and the state of the market more broadly – are interesting in so far as they focus entirely on issues within the automotive sector. What, precisely, is being sought? It is natural for businesses to wish for certainty and consistency, without which it is difficult for them to make plans or operate with any confidence. This, however, does not appear to have been mentioned. Rather, what seems to be at issue is the financial support provided to the sector by way of the Motability scheme.
One might wonder, therefore, whether this constitutes an example of the kind of rent-seeking behaviour deplored by Adam Smith in his comment that ‘People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the publick, or in some contrivance to raise prices.’ While this observation was made in the context of a discussion of trade corporations and competition in employment, it reflects Smith’s concern at the tendency of those in business to seek monopoly advantages or government regulation that favours their own operations. Such behaviour – whether in the form of lobbying for special tax exemptions or using a dominant market position to exclude competitors – aims to increase one’s own profits without offering any additional productivity in return. Is this what figures within the automotive industry are engaged in, essentially seeking government financial support for their own advantage? Are they arguing that the proposed reforms should be abandoned because they are ‘bad for the sector’?
It could be argued – and perhaps this is the contention of the executives in question – that helping the motor industry is in the public interest. Maybe there are grounds for continued government support – in effect by leaving the scheme to operate as it is – based on the wider economic benefits. Through the Motability scheme in its current form, the argument might run, the government supports investment and research within the motor industry, or at the very least the provision of jobs. It thereby restricts unemployment and encourages spending, thus stimulating economic activity more broadly and contributing to economic growth.
There may be an argument of this kind to be made, but it invites the question of whether a scheme designed to assist those with mobility problems represents the best means by which the government could provide a stimulus to growth via the automotive sector – and why via this sector rather than any other? We might wonder whether the Motability scheme has accidentally become part of the UK’s industrial strategy. That is to say, a scheme intended to support those with mobility problems – that is, a supposedly targeted form of welfare provision – appears to be serving as a form of demand support for the automotive industry, to which some within the sector feel entitled or believe is essential to their economic success.
The purpose here is not to adjudicate the merits of either the Motability scheme or the effectiveness of any form of government-funded demand support for industry. However, an arrangement that seems to function as both, without necessarily doing either well, surely requires revision, particularly if, to follow Smith, those who benefit commercially come to see the provision as something to which they are entitled – all the more so if that form of unintended support is in danger of collapse when government thinking on welfare provision is revised.
A more effective approach would be to consider the UK’s welfare needs independently of any industrial strategy and to implement policies designed to achieve the best outcomes in each area respectively. Such an approach could reflect a coherent economic vision aimed at yielding the economic goods of labour market participation, increased prosperity and targeted and effective welfare provision.
To develop this kind of economic vision, we must engage with fundamental issues concerning our values, the kind of society we want to build and the kind of economic arrangements which will support it. Do we seek simply an increase in wealth, or are there other outcomes to be pursued, too? Are we hoping simply for growth, or growth of a particular kind? How should the increased wealth be distributed? What kind of employment do we wish to see provided: simply ‘jobs now’, or sustainable, productive work that is conducive to human flourishing in the long run? These questions oblige us to consider what kind of prosperity we seek.
Ultimately, we are brought to reflect on our conception of the good – both for individuals and society more broadly – for it is only with a grasp of such notions that we can make sense of the question of whether a particular sector ought to receive support from government, or whether measures to grow the economy are appropriate.
Without this, there is the possibility that economic support from government will always be subject to the competing claims of self-interested groups seeking their own advantage, used haphazardly to address one crisis after another as each arises, or spent on various projects to ‘promote growth’, without coherence or overall purpose.
Neil Jordan is Senior Editor at the Centre for Enterprise, Markets and Ethics. For more information about Neil please click here.
You may work, but are you a working person? This might just sound like an annoying exam question: probably one from the exams once sat by CEME’s philosophers and theologians, rather than by our economists. In fact it now appears to be crucial. It could determine your, and Britain’s, prosperity.
Back in 2024 page 21 of the Labour Party election Manifesto pledged not to ‘increase taxes on working people, which is why we will not increase National Insurance, the basic, higher, or additional rates of Income Tax, or VAT.’ In other words, while there would be tax rises after the election, there was a pledge to protect a defined group of ‘working people’. This made good sense as an electoral strategy, even if depended partly on vagueness. A lot of people assumed, perhaps naively, that the protected group included them. Because they worked, they were a working person.
A year ago, as the new government’s first Budget neared, the Prime Minister was pressed to clarify the definition. In an interview on 23rd October 2024 with the BBC’s Chris Mason he was asked whether ‘those who work, but get additional income from assets such as shares or property, would count as working people’, Keir Starmer said, no, they did not count. What he meant was a person who ‘goes out and earns their living, usually paid in a sort of monthly cheque’ and who can’t ‘write a cheque to get out of difficulties’.
The problem was that this definition now excluded anyone with a small amount of savings. A Number 10 spokesperson rushed to clarify. People with a ‘small amount of savings’ were included in the protection. This was not quantified, but included ‘cash savings, or stocks and shares in a tax-free Individual Savings Accounts (ISA)’. (Depending on the punctuation, that example may prove to have been a hostage to fortune, given rumoured changes to Cash ISAs.)
The next day on the Today programme the very capable Exchequer Secretary (now Chief Secretary) to the Treasury, James Murray, was asked five times whether landlords were also protected. Do they work? With grace and admirable resilience he declined to answer. He may have understandably felt there ought to be easier questions on the exam paper. Entrepreneur and broadcaster Steph McGovern pointed out wryly on The Rest Is Money that caring for tenants as a landlord had been the toughest job she ever had.
Later that day the Chancellor was asked on LBC, perhaps mischievously, whether the Prime Minister, already lavishly pensioned after retirement as Director of Public Prosecutions, counts as a working person. ‘The Prime Minister gets his income from going out to work and working for our country,’ she said. ‘He’s a working person. He goes out to work.’
Ultimately the major tax measure in the 2024 Budget was a rise in Employer National Insurance Contributions. To preserve the manifesto pledge, the Chancellor relied, not on a definition of the group of people involved, which was wide, but on the type of impact. She made a distinction between payment and incidence. Still not to be raised were taxes where the payments were actually made by working people: happily for her this was not true of Employer NICs. Able to be increased, however, were taxes where the incidence fell on working people: unhappily perhaps for them this was true of Employer NICs.
Fast forward a year and the approach of the 2025 Budget has raised the definition again. It appears the definition of working people may be about to narrow considerably. Sky News obtained last week what it described as ‘an internal definition of “working people” used by the Treasury’, where ‘officials have been tasked with protecting the income of the lower two-thirds of working people’, estimated as people earning below around £46,000. If so the Manifesto pledge would be being retrospectively redefined as applying to only this sub-group of working people.
In addition the concept of ‘protecting income’ could also drastically water down the pledge for everyone. It would shift it from the level of each individual tax to the collective net impact of tax changes. The pledge had been understood as capping the level of individual taxes: ‘we will not increase National Insurance, the… rates of Income Tax, or VAT.’ That may no longer hold, even for the lower two thirds of workers. Rather, one or more of the broad-based taxes could be raised on the lower two thirds of workers, so long as the net impact of tax, or even overall fiscal, changes leaves the lower two thirds of workers no worse off. (This is the kind of thinking used in the ‘distributional analysis’ tables which accompany UK budgets, showing the net impact of budget measures on each percentile of income.)
Much could be said about the economic wisdom of all this. No doubt it will be, including by us at CEME. For now I want rather to make a theological point about the whole debate. Theologically I would certainly give the government credit for their original pledge and their willingness to wrestle with a definition.
That is because they are acknowledging that work matters. And that is right. It matters to each of us, and to our neighbours, and to God. As Richard Turnbull puts it in Work as Enterprise: Recovering a Theology of Work, ‘Christian theology provides both a moral and a spiritual language about work – a language that conveys principles of enterprise, beauty and relationships’ (page17). There is a trace of this in the government’s pledge: an instinct to valorise work, to encourage it and to preserve as much as possible of a worker’s share of the fruits of their labour.
On the other hand the pledge, even as originally framed, has three drawbacks. First it risks creating a divisive narrative. It identifies one group, the real workers, who will be protected from tax increases, and an out group, who will not be. By making pledges only about income and consumption taxes, it also implies that the wealth which some work generates is somehow a particularly legitimate target for additional taxation, as Neil Jordan suggested last week. Perhaps the language was even intended to carry a hint of Marxist class analysis. But certainly it was about ‘othering’. (In that way it recalls equally unhelpful attempts in the past to distinguish the ‘deserving poor’ from those taken to be less deserving.) Of course choices have to be made about who pays what. Of course the argument of broader shoulders bearing heavier burden always has merit in any community. But setting the issue up in the language which hints at class conflict has many downsides.
Secondly identifying a sub-group as working people encourages a debased view of work. Surely most of the population aged 8 to 88 are working people. Retired people supporting charities with their time and wisdom are doing work. Family members who care for their loved ones are doing work. Even our young people at their studies and training are doing work, if of a preparatory kind. Richard Turnbull suggests definitional features of work (page 17) include: human activity which carries both intrinsic and extrinsic value; requiring physical, emotional or intellectual energy; resulting in human development; and providing for human need. Of course another important characteristic of much work is that it relates in some way to economic exchange, and that is also to be celebrated. But when the concept of work is deployed within a potentially divisive narrative about differential tax policy, it risks being narrowed. Something which should be seen as having, to use Tom Holland’s favourite word, a ‘sacral’ element, is reduced to the financial element of paid employment.
Finally the understanding of paid work which underlies this policy narrative seems outdated, if not nostalgic. Like the Prime Minister, I grew up with a cheque book. Now ‘just Monzo me, bro’, as the younger generation would say. But, more fundamentally, as Richard Turnbull’s thoughtful introduction also suggests, ‘work is not a static concept’ (page 7). Payroll employment remains the most significant form of paid work, but it is no longer the only form available. We have now had four industrial revolutions, not just one. To look ahead, at CEME we have already been working on, and are about to discuss, the issues raised by a fifth: the use of Artificial Intelligence, which has the potential to change the world of work.
Over the next month it looks like some or all British working people may need to prepare for unwelcome fiscal news. Looking even further ahead, as the AI revolution accelerates, perhaps we will have to adopt Bill Gates’ suggestion and ‘tax the (Working) Robots’. I don’t know what political leverage robots will have, working or otherwise, but I fear they will find that Benjamin Franklin’s rule applies no less to them. If so they had better prepare like us for the two certainties of death (or at least obsolescence) and taxes.
Revd. Dr. Philip Krinks was recently appointed as Director of CEME.
In March this year, I raised the question of whether the council tax premium on second homes constituted a solution to difficult problems – namely shortages of housing in some areas and straitened local authority finances – or was in effect a sumptuary law of sorts.
The Moral Issue
An important question was whether there was any ethical justification for the premium. One justification might be that investing earnings in a second home is in effect acting against the public interest, such that councils use the premium to discourage ‘hoarding’ of a scarce resource (housing). In response, however, some argue that such an outlook is naïve: second homes are often unsuitable for local residents, particularly first-time buyers, usually because of their age or character and cost, while in other cases, owners who renovate very old properties, far from diminishing the stock of habitable homes, actually add to it in the long run.
A further justification would be that the council tax premium helps to fund local services, yet critics argue that second home owners are thereby charged disproportionately for services – services that they do not even use all year round. As such, the rate charged appears to constitute supranormal taxation, legitimated by the additional wealth represented by possession of a second home. The suggestion here is that there is an ethical justification for taxation at a higher rate, as though wealth (or certain ‘lavish’ uses of it) is somehow immoral – a notion which historically lay behind certain sumptuary laws and which appears to be finding support at present. Recent discourse has suggested growing interest in new wealth taxes and there has been discussion of tax rises to target the wealthy in the forthcoming budget.
Interestingly, the government has not so far taken the view that wealth is unethical, the Chancellor having stated in the past that hers was now the party of wealth creation and written that wealth creation would be the defining mission of the government. While this was questioned from both sides of the political divide, as to whether it the proper role of government or even a desirable objective in itself (when perhaps wealth distribution might be considered a more pressing issue), there was clearly no suggestion on the Chancellor’s part that wealth was ‘unethical’.
The Economic Issue
On the economic aspects of the premium, I suggested that these would need to be observed before any conclusions could be drawn about their success as policy measures, and noted that historically, sumptuary laws, in addition to being difficult to assess, tend to have unintended consequences. The results of any council tax premium are likely to differ according to the area in which they take effect, as well as the manner in which they are implemented – and it is probably too early to make any kind of general judgement regarding their success or otherwise – but developments in one council are interesting.
A Local Case
It has been reported that Pembrokeshire County Council, which has the second highest number of second homes in Wales, has reduced its council tax premium on second homes twice in the space of 12 months. Having been increased to 50 per cent in 2017 and then 100 per cent in 2022, the rate has been reduced from a high of 200 per cent in 2024, to 150% and in recent weeks, to 125%.
It would appear that hundreds of second homes have been offered for sale in recent months, which would suggest that as a measure designed purely to increase housing stock, the premium could be considered successful. However, such properties have been slow to sell because prices are too high for local residents to afford. To date, therefore, the measure could not be said to address the lack of suitable available housing in the area, though there remains the question of market dynamics will lead to a longer term ‘correction’ of prices.
Unintended Consequences
It is evident that the premium as implemented has had unintended consequences. There is anecdotal evidence that the reduced number of holiday homes is having a negative impact on tourism in the area, Pembrokeshire being home to popular holiday destinations such as Tenby. Those in favour of the premium question its effects on tourism but any such decline in economic activity is likely to result in reduced tax revenues. It is of interest that a public consultation revealed a majority of non-second home owners (64 per cent) preferring a reduction in the premium on second homes.
Furthermore, the latest reduction in the council tax premium, effective from April 2026, will cost the council £1.4 million in potential income next year, which makes higher council tax increases for permanent residents more likely.
Conclusion
There are indeed serious challenges to be addressed by local authorities. Suitable, affordable housing is often in short supply and many are facing serious budgetary difficulties. A higher charge on second homes suggests itself as an obvious measure for addressing both but it is possible that the effects will not be as anticipated. A final assessment of the council tax premium would need to consider both broader moral questions and whether it accomplishes its economic aims. In areas where there is no strong tourist industry, perhaps a premium will have a minimal effect on local economic activity, or second homes offered for sale will not be out of reach of local buyers. Even where the policy shows signs of success, however, it is likely that other measures will be needed to address problems with housing supply. Where the desired outcomes fail to materialise, there remains the question of what grounds exist for a second home premium, beyond disapproval.
Talk given at the Danube Institute’s Conference, Budapest, 2nd October 2025. Brian also gave an interview about related topics.
Mrs Thatcher became Prime Minister in May 1979 at a time when the UK economy was suffering from ‘the British disease’ and known as ‘the sick man of Europe’.
We had just emerged from the ‘Winter of Discontent’, during which there had been constant industrial disputes and strikes, many unofficial, uncoordinated and local. Some years earlier inflation had reached 27%. The Chancellor of the Exchequer Denis Healey had been forced to go, cap in hand to the IMF to avoid defaulting on our debts; no one would lend us money. We were bust. Inflation was still 13% in 1979 rising to 18% in 1980. Over the decade mismanagement of the economy and trade union militancy had led to the downfall of three governments: those of Wilson in 1970, Heath in 1974 and Callaghan in 1979. There was in British society a sense of helplessness, a feeling that the country had lost its way.
Mrs Thatcher set out to find practical remedies for the problems facing the British economy. She realised that not all could be achieved at once and I believe she thought of the response to the challenge in terms of three major steps.
First inflation must be defeated.
Second the size of the state in the economy must be reduced.
Third the market economy must be strengthened.
To start with it would be impossible to improve the standard of living without bringing inflation under control and establishing financial stability.
Inflation had been accompanied by rising unemployment which was not the Keynesian expectation. Inflation created uncertainty. It deterred business investment. It was hated by the public. Unexpected rises in the cost of living led to hardship with consequences such as higher interest rates which continued long after inflation had come down.
Although she was a practical politician, Mrs Thatcher was always interested in ideas. She was genuinely intellectually curious. She invited people into Number 10 from all sorts of different fields in order to explore ideas: historians, environmentalists, educationalists, theologians, architects and so on. And the field of economics was no exception. She valued meeting economists from abroad such as Milton Friedman, Fredrick von Hayek, Karl Brunner, Allan Meltzer as well as central bankers such as Otmar Emminger, and Karl Otto Pöhl (Bundesbank Presidents) and Fritz Leutwiler (Chairman of the Swiss National Bank).
Unlike many economists in the UK and senior officials at the Bank of England, these academic economists and practical central bankers saw inflation as a monetary phenomenon. They claimed they had achieved price stability in their countries because they had successfully controlled money supply growth, not because they had introduced prices and income policies. (Incidentally, money growth had been the traditional explanation for inflation in the writings of David Hume, Adam Smith, and Alfred Marshal – and even Keynes had spent six years in the 1920’s producing two large volumes entitled A Treatise on Money (1930), analysing the Quantity Theory of Money). This approach was also that of a small number of contemporary British economists such as Professor Alan Walters, whom she appointed as a special adviser based in No10, and Professor Harry Johnson, who held a joint chair of economics at the London School of Economics and the University of Chicago. By contrast these were not the views of the Bank of England or the UK Treasury which were still strongly influenced by Keynesian thought.
However, recognising that inflation was a monetary issue proved to be far easier than controlling the growth of money itself. How was it to be measured? How easily was it to control in the short term? How stable was the demand for money? How might it change when there were changes in the regulatory structure of the banking system, such as Competition and Credit Control 1971? Or external shocks to the system such as the Great Financial Crisis in 2008-9? These were difficult existential challenges for the Bank of England tasked with controlling money supply growth and financial stability. Controlling money supply growth however ensured that by 1986 retail price inflation had fallen to 3.4%.
Mrs Thatcher recognised that for the monetary policy to be successful, fiscal policy should accommodate monetary tightening and not work against it. This it did through the creation of a Medium Term Financial Strategy (the first ever for the UK Treasury) which linked targets for money supply growth to public sector deficits, public sector borrowing and the annual Budget. Alan Walters claimed that
It is difficult to exaggerate the importance of the commitment to the MTFS. It provided a frame of reference for all financial and economic policy. Never in the post-war history of Britain had the spending programs and the revenue and taxation consequences been so closely associated at the highest level of government decision making.
(p.83, Britain’s Economic Renaissance, OUP, 1986)
This framework provided effective fiscal discipline and led to the notorious 1981 budget. This was condemned by 364 UK academic economists in a letter The Times following a ‘round robin’ initiated by two Cambridge University professors, Frank Hahn and Robert Neild. For them, the uncomfortable fact was that this budget proved to be the turning point for Britain’s economic renaissance.
After having set out on a policy to introduce monetary discipline the second element in her policy was to reduce the scale of the state.
The case she made was that the state took too great a share national income, so government spending as a proportion of GDP needed to be reduced. The public sector borrowing requirement was crowding out private sector borrowing, so it, too, needed to be cut. In addition, state owned industries would be much better managed as commercial entities rather than being answerable to elected politicians in parliament.
This led to the policy of privatisation – steel, airlines, telecommunication, cars (Jaguar), gas, electricity, aerospace, petroleum, coal and so on. What was remarkable about privatisation was the way in which the policy, once shown to work in the UK, was adopted in the following two decades by so many countries throughout the world.
The scale of the state was also reduced by a housing policy which allowed the sale of council houses by local authorities to their tenants at considerable discounts, ranging from 33-50%, depending on their tenure. This meant a highly significant transfer of wealth and the ability of new house owners to pass their property on to their children.
The third element of Mrs Thatcher’s economic policy focused on strengthening the market economy.
In 1974 Mrs Thatcher and Keith Joseph had set up the Centre for Policy Studies to make the case for a market economy. By enabling prices to change and firms to enter or exit markets, they believed a market economy could achieve a more efficient allocation of resources than state planning, public ownership or government bureaucracy ever could.
They were also convinced that markets should be placed in the broader context of social responsibility. Many of the criticisms of the market economy were that it produced a culture of greed, individualism, and ‘dog-eat-dog’. They thought the creation of greater wealth through the market economy must be achieved alongside greater resources being available for those in need, whether due to ill-health, advanced age or deprivation.
Strengthening the market economy involved the abolition of rent controls, the abolition of foreign exchange controls, the removal of constraints on competition in banking and the London Stock Exchange – permitting foreign companies to enter London’s financial market – the removal of general controls over prices and wage growth and an almighty battle against trade unions to allow management to manage their firms without constant interruption from militant unions. This last required bitter battles in parliament and confrontations between police and protesters.
Her economic policy focused on wealth creation was part of a wider policy framework which increased parental choice and standards in education and training and increased expenditure in health and welfare. The social market economy provided the safety net for those unable to benefit directly from greater wealth. Standards in schools were improved. Scientific research dealing with technology and radical innovation was supported.
Thatcher’s economic policy had a coherence to it. It set out to achieve stable prices, reduce the size of the state and create a vibrant but socially responsible market economy. She succeeded in some areas: the importance of monetary policy in defeating inflation, reducing the size of government spending in GDP from 43% to 35%, strengthening an enterprise culture, extending home ownership and privatising state-owned industries. In others she did not succeed: the privatisation of water and railways, the imposition of the community charge for local services (the ‘poll’ tax) and increasing charitable giving.
There is one final point I would like to make.
While Mrs Thatcher engaged with the specific details of monetary policy or trade union legislation, this was in the service of an underlying moral world view. However, the idea that she had an ‘unidentified morality’, as Shirley Letwin has suggested, is somewhat misleading.
What she had was more than an intellectual framework or worldview. It is perhaps better understood by the German word Weltanschauung, which means not just an intellectual framework, but a driving force animating one’s being and generating a purpose for life’s work.
This for Mrs Thatcher was undoubtedly her Christian faith, something she made very clear in her speech to the General Assembly of the Church in Scotland on May 21st, 1988, in which she identified ‘three beliefs’ of the Christian faith.
First, that from the beginning man has been endowed by God with the fundamental right to choose between good and evil. Second, that we are made in God’s image and therefore we are expected to use all our own power of thought and judgment in exercising that choice; and further, if we open our hearts to God, he has promised to work within us. And third, that our Lord Jesus Christ the Son of God when faced with his terrible choice and lonely vigil chose to lay down his life that our sins may be forgiven. (Christianity and Conservatism, edited by The Rt Hon Michael Alison MP and David L. Edwards, Hodder & Stoughton, 1990, p.334)
She also spoke of ‘my personal belief in the relevance of Christianity to public policy’, recognising both the importance of the teaching of the Old and New Testaments and especially the importance of the family, on which ‘we in government base our policies for welfare, education and care’. (Speech by Mrs Thatcher to the opening of the General Assembly of the Church in Scotland, 21st May 1988, Christianity and Conservatism)
I believe you will never really understand Mrs Thatcher’s economics or politics unless you grasp her Judaeo-Christian worldview.
In conclusion, I believe this is ultimately the greatest legacy which Mrs Thatcher gives us today on the Centenary of her birth.
Brian Griffiths (Lord Griffiths of Fforestfach) is a Senior Research Fellow at Centre for Enterprise, Markets and Ethics (CEME) and Founding Chair of CEME (serving as Chair until 2023). Among other things he served at No. 10 Downing Street as head of the Prime Minister’s Policy Unit from 1985 to 1990 and Chair of the Centre for Policy Studies (CPS) from 1991 to 2001.
How We Found Our Callings
While all definitions of calling share in common the notion that work becomes meaningful within a person’s life, they differ on whether the source of the calling is internal, based on one’s own values, needs, and preferences, or external, based on either a calling from a higher power, a ‘transcendent summons,’ or a sense of fulfilling one’s destiny. Our own academic work together – which began with research on how the work of 9/11 victims was seen in the eyes of their close relations, and which has led to the publication of two books and several scholarly papers – feels secular in origin. We were both called to academia within a year of 9/11, when we were both living and working in New York City as management consultants, and although the call came from both a world in need of repair and from inside of us, it did not in our experience come from on high.
Religious and Secular Callings in the Financial Capital of the World
The first name on the New York City Medical Examiner’s list of casualties of the September 11, 2001 terrorist attacks is that of Father Mychal Judge. He died carrying out his calling amid danger, praying to God over victims when he was killed by falling debris. Many people who died that day in a variety of uniforms were characterized as having lived out their callings, according to research we conducted. Most obviously, included are first responders like Jonathan Ielpi, a firefighter who followed his father into a profession in which he was ‘more concerned about others than he was about himself,’ Whether or not those callings were equally heroic, their origins were not always overtly religious.
Some callings sounded decidedly secular in origin, such as those of trader Frank Garfi, who ‘found a job that suited him precisely…fast-paced, demanding and as power-filled as an extreme sport,’ and trader Atsushi Shiratori, who was ‘so obsessed with the stock market that he once spent a two-week vacation in a day-trading salon. Sheryl Rosenbaum, who had known since her childhood visits to her father’s accounting office that ‘this was what she wanted to do,’ continued while she raised two young children of her own.
The History of Religious Callings
The notion of work as a calling has religious origins. As fellow management scholars Stuart Bunderson and Jeff Thompson detail in one of the foundational academic studies of calling toward work, the Protestant Reformation – and specifically the writings of Martin Luther – witnessed the transition of ‘calling’ from a narrow association with clergy work to a broader association with potentially any type of work. The important part was performing one’s work diligently and faithfully, laying the foundation for Max Weber’s notion of the Protestant Work Ethic.
This historical period also marked the culmination of a gradual transition of perceptions of work ‘from curse to calling,’ in the words of philosopher Joanne Ciulla. In Ancient Greece, work – especially manual labor – was seen as drudgery, punishment, and a distraction from one’s main goal of living a good life which was fully experienced in the life of the mind and certain types of leisure pursuits. When work becomes a calling, it becomes not a means to an end, but a meaningful end unto itself, a way to make a unique contribution to the world. The religious view of calling still has purchase in today’s conversations, in both scholarly writings and in the popular press. However, a different view has also emerged more recently that takes this same spirit into an explicitly non-religious context.
The Rise of Calling as a Secular (and Managerial) Concept
In another study, Thompson and Bunderson suggest that religious callings are typically ‘outside-in,’ emphasizing ‘destiny and duty’ and anchored in ‘societal obligations or an external summons.’ They contrast them with secular conceptualizations of calling that are typically ‘inside-out,’ emphasizing ‘passion and self-fulfillment’ and anchored in ‘internal preferences.’ Proponents of the former may express skepticism about whether the latter constitute ‘true’ callings. Proponents of the latter may doubt whether duty absent the passion to carry it out is sufficient to constitute a calling. Proponents of both tend to recognize that the best callings are those in which one feels to called in one’s heart to do what one is called by the world to do – or, in the words of theologian Frederick Buechner, ‘where your deep hunger and the world’s deep gladness meet.’
By the mid-1970s, when the field of management and organizational behavior was gaining traction as an academic discipline, scholars and other writers were increasingly considering work as a calling in a non-religious sense. For example, Studs Terkel’s famous compendium of interviews, Working, had a section titled, ‘In Search of a Calling’ that featured an editor, an industrial designer, and a nun-turned-massage therapist.
Jobs, Careers, and Callings
The presence of calling in management research – where we first encountered it – originated with a book by Robert Bellah and colleagues, Habits of the Heart. This book was not about callings or even work – the section on work was just over five pages long, the same length as a section on ‘leaving church’ – but rather about understanding how Americans’ private lives contributed to or detracted from their civic engagement. Yet, the writings about work proved to have a profound and outsized impact in codifying how ordinary people relate to their work. Based on interviews, the authors distinguished between work as a job or a means to make money, a career or a means to climb a career ladder, or a calling where work is a meaningful end in itself and ‘morally inseparable from [a person’s] life.’
These categories were further popularized and disseminated when they became the subject of study within organizational psychology by Amy Wrzesniewski and colleagues as one of three work orientations. In a pioneering study, Wrzesniewski found that, compared to a job or career orientation, employees who viewed their work as a calling reported greater satisfaction with work and with life and missed fewer days of work. As in Martin Luther’s view, any work could be viewed as a calling by the person holding it – even seemingly low-paid, low-status, and/or ‘dirty work,’ from hospital cleaners to zookeepers to administrative assistants. As a psychological construct, work orientation held that two people with the same position in an organization could come to view their jobs in wildly different ways: one a job, the other a calling.
What Do We Know Today?
Callings Can Be Sacred And/Or Secular
Academic research on work as a calling has exploded in the past two decades, which almost exactly mirrors a focus in the popular press on finding one’s calling through work. Reviews of calling research are quick to note the dual (if not dueling) perspectives on whether callings are sacred or secular. The neoclassical view of calling preferred by Bunderson and Thompson aims to build directly on the classical, religious view put forth by Luther and later Weber, defining calling as ‘that place in the occupational division of labor in society that one feels destined to fill by virtue of particular gifts, talents, and/or idiosyncratic life opportunities.’ The modern view, articulated by Dobrow and Tosti-Kharas, defines calling as ‘a consuming, meaningful passion people experience toward a domain, such as work.’
Both Kinds of Calling are Paths to a ‘Good Life’
A recent meta-analysis, of which Jen was a coauthor, examined more than 200 empirical studies of calling over the past 20 years, finding that experiencing a strong calling toward one’s work was related to a sense that one’s life was good. Whether a function of our work-centered modern culture, or of some jobs becoming objectively ‘better’ in post-industrial society, work is no longer necessarily a curse. The meta-analysis authors then looked at whether the type of calling, internal/modern or external/neoclassical, related to different types of well-being, hedonic (happiness or pleasure) or eudaimonic (meaningfulness, purpose, and self-realization). Both internal and external callings related to both types of well-being; however, internal callings were more strongly related to hedonic well-being, while external callings were more related to eudaimonic well-being.
What Does This Mean for Workers?
Callings Have Great Benefits…
In any case, possibly because we spend so much of our waking time at work, feeling that work has positive meaning has the potential to enhance our own and others’ flourishing. This is especially so with eudaimonic well-being, which can be supported by callings whether they are religious or secular in origin.
…And Can Come at Great Costs
Yet, the picture of how callings contribute to our lives is complicated, because they often demand sacrifices that can have deleterious effects on our well-being. The zookeeper study, which employed a neoclassical lens, portrayed calling as ‘a painfully double-edged sword.’ On one hand, a sense of calling elevated the importance and meaningfulness of work in subjects’ lives; on the other hand, it required sacrifices in the form of pay, long hours, and even social esteem. Further research supports that, regardless of whether callings are seen as secular or religious, they are intensely-felt and may involve a host of irrational behavior, from over-estimating one’s ability at work to ignoring the advice of trusted mentors to sacrificing money. A study of church ministers found that those with strongest callings had the hardest time disengaging from work at the end of the day, which in turn negatively affected their sleep quality and their vigor the next morning.
Callings are Worth Pursuing…
All of this is to say that, if we are fortunate enough to have a choice in the matter, we should choose wisely about whether to pursue work as a calling and which callings are worth pursuing. We should be realistic about what to expect of a calling, because even people who love their work may not be happy about the sacrifices and demands it requires every day. The cliché that if you ‘do what you love and you’ll never work a day in your life’ is often false, as anyone who has so much passion for their work can attest when the lines between their personal and professional lives blur to the point that they cannot escape work. We should also be mindful about whether some callings are ‘better’ than others. In our 9/11 research, which was based on close relations’ idealized reflections of how they wished their loved ones’ lives to have been, we found not only that a disproportionate share of victims were depicted as having worked at a calling but also that those callings which emphasized helping others and cultivating relationships with them were particularly admired. In those portraits of victims’ lives, their close relations found reasons for why even the most mundane or low status work – including that of receptionists and security guards and window washers – might have been worth loving.
…But Are Not a Panacea
As university professors, we counsel students not to feel undue pressure to ‘find their callings,’ especially as a surefire path to a perfect life. We teach them that some people are born knowing exactly what they were called to do and others search their entire lives in vain for a calling. They can’t control which one they might be, but it is within their control to carefully consider what pursuits are worth undertaking in a life worth living.
Jennifer Tosti-Kharas is the Camilla Latino Spinelli Endowed Term Chair and Professor of Management at Babson College.
Christopher Wong Michaelson is the Barbara and David A. Koch Endowed Chair in Business Ethics and Academic Director of the Melrose and The Toro Company Center for Principled Leadership at the University of St. Thomas and on the Business and Society faculty at NYU’s Stern School of Business.
Jen and Christopher are the authors of Is Your Work Worth It? How to Think About Meaningful Work (New York: Public Affairs, 2024) and The Meaning and Purpose of Work: An Interdisciplinary Framework for Considering What Work is For (London: Routledge, 2025).
There are growing concerns that capitalism and democracy are in crisis. Despite the success of free markets in creating global prosperity over two centuries, the recent slowdown in growth in Western economies, the persistence of inflation, increasing economic inequality, financial instability and the explosion in debt have called into question the value of market capitalism. Moreover, trust has been eroded in liberal democracies because of dysfunctional governments, a perceived lack of commitment to truth and political leaders playing the game to the edge of legality. Added to these concerns are the growth of a post-modernist culture with steadily increasing social fragmentation, divisiveness and the lack of a unifying and accepted source of appeal.
We are living in the 21st century in Western societies in which religion has not just been replaced by secularism, but the one God of the Christian religion, with its deep roots in Judaism, has been replaced by the pluralism of the many gods of modernity. As a society we require those in leadership and authority in business and politics to have a moral compass and as Adam Smith set out regarding the virtue of prudence and Burke regarding the role of religion, our fellow citizens need values of honesty and sympathy if we are to seek the common good.
Against this background and under the auspices of the Centre we have decided to launch a series of colloquia in which to explore a Christian perspective on contemporary issues of political economy. On each occasion a small panel of experts will present their thoughts on the chosen topic, and other participants will then have the opportunity to make their own contributions to a free-flowing discussion. Participants will be invited from across the political spectrum and the number kept to around twenty. Following the links below you will find the contributions made to each meeting. We hope you find the papers stimulating.
The fifth Fforestfach Colloquium took place on Monday, 17 November, 2025 in Committee Room G of the House of Lords. Once again, an invited audience of around 20 people gathered to hear our speaker, The Rt Hon. Lord Biggar of Castle Douglas, CBE, (Professor Emeritus Nigel Biggar) address the topic of whether theology has a role in public life.
In his remarks, Lord Biggar pointed out that theology often shapes public debates, albeit sometimes implicitly. Christians can help maintain civility by modelling virtues rooted in their beliefs about human nature and moral order, such as courage, justice, charity, openness to learning, humility, forbearance, and a steadfast commitment to truth. While such virtues are not unique to Christianity, they are seldom discussed in modern Western society, where rights-based language tends to dominate moral conversations. This absence makes virtue harder to name, share, or promote, which can allow vice to thrive.
By embodying and openly discussing these virtues during contentious cultural debates, Christians can highlight their value and help foster a more rational, liberal culture. Lord Biggar’s points were discussed and expanded by our audience, led by a particularly thoughtful and insightful set of comments from Jason Cowley, the former editor of The New Statesman.
Our fourth Fforestfach Colloquium focused on the subject of ‘Covenant’. It was held in Committee Room G in the House of Lords on the morning of Thursday, 26 June.
Our two principal speakers came from opposite sides of the political spectrum, both of whom have studied and written about the concept of covenant: Danny Kruger, MP, the Conservative member for East Wiltshire, and Lord (Maurice) Glasman, who founded the Blue Labour movement.
Danny Kruger published in 2023, Covenant: The New Politics of Home, Neighbourhood and Nation. In the book, he describes the key difference between the ‘social contract’ of Hobbes and Locke, and the ‘social covenant’ that he conceives: covenant, he writes, is a set of relationships built on love rather than on reason, an ‘artificial brotherhood’, expressing unconditional love between unrelated individuals, the foundational example of which is the covenant of marriage, ‘the union of two unrelated people that forms the nucleus of a new blood relationship, a family.’ Covenants also underly communities and nations.
Maurice Glasman, in his 2022 book, Blue Labour, points out that ‘…covenant requires that human beings are not treated as commodities, and that there is an inter-generational commitment to the common good between classes and regions based on the renewal of place… Neither the state nor the market is sufficient to generate a good society: it requires the renewal of society…’
Before the meeting, we had circulated a set of four questions on the topic for attendees to consider for themselves. We were delighted to be presented with some deeply thoughtful responses to those questions by our third contributor, Rabbi Benjy Morgan, who is the Chief Executive of the Jewish Learning Exchange in Golders Green. His reflections on our questions provided us with a number of very helpful Old Testament insights regarding the biblical concept of covenant.
As in our previous Fforestfach Colloquia, the invited audience of about 20 guests engaged enthusiastically with the presentations and the ensuing discussion, responding to points made by the speakers and also developing new lines of thought over the course of the morning.
Our third Fforestfach Colloquium took place in the House of Lords on the morning of Thursday, 30th January 2025, on the topic of Postliberal Political Economy, and brought together three speakers from academic, political, economic and media backgrounds.
Liberalism enjoyed a renaissance in the second half of the twentieth century. At the beginning of the 1960s, we saw the development of a socio-cultural liberalism on the left of UK politics, while in the 1980s, we experienced a growing economic liberalism from the right. Both those trends have given rise in the present century to the growth of post-liberalism, as explored in publications such as The Politics of Virtue (2016) by Adrian Pabst and John Milbank and Postliberal Politics (2021) by Adrian Pabst.
These publications, among others, provide a blueprint for a national, communitarian renewal, emerging from both the centre-left and centre-right. Importantly, postliberalism recognises the importance of the Christian heritage and Judeo-Christian ethics in providing a foundation for the renewal of a civic covenant, in the form of a partnership between generations and regions, and with nature.
At our Colloquium, we were addressed first by Professor Adrian Pabst of the University of Kent, who is also the Deputy Director of the National Institute of Economic and Social Research. His contribution pointed to the recurring crises experienced in advanced capitalist economies such as the UK, Germany, France, Italy, and Japan, which have struggled with low growth, high inflation and stagnant real wages ever since the 2008-09 financial crisis. Professor Pabst argued for a shift towards a social market economy, anchored in a greater sense of purpose and virtue.
He was followed by two distinguished speakers, his co-author, Dr John Milbank, Professor Emeritus at the University of Nottingham, and Miriam Cates, the former Conservative MP for Penistone and Stocksbridge in Yorkshire. They discussed alternative approaches to the postliberal economic challenges of our time, with Dr Milbank exploring the historical relationship between Christianity and Political Economy, suggesting that a truly Christian approach would seek to marry up what is practical and useful in modern economics with a more ancient humanism that does not surrender its ethical values. Miriam Cates, on the other hand, argued that many of the socio-economic crises we have experienced arise from the breakdown of Christian family values in the postliberal era, and called for a political economy based on a foundation of pro-family policies and a welfare state that encourages and supports families as a building block for a modern human society.
The second Fforestfach Colloquium took place in the House of Lords on Monday 29th April. We were privileged to welcome as our lead speaker an eminent professor from Harvard University, Professor Benjamin M. Friedman, who is the William Joseph Maier Professor of Political Economy and the former Chairman of the Department of Economics. Professor Friedman’s newest book, published in January 2021, is Religion and the Rise of Capitalism, and we invited Professor Friedman to speak to our invited audience about the theme of his book, to be followed by two highly-respected commentators, Professor Emeritus Forrest Capie of the Bayes Business School, and Lord (Mervyn) King of Lothbury, former Governor of the Bank of England.
Centre for Enterprise, Markets and Ethics
On Monday 14 July, CEME held an event with guest speaker Dylan Pahman (Acton Institute).
Organised in partnership with Blackfriars Hall, Pahman spoke on his forthcoming book The Kingdom of God and the Common Good.
The event was chaired by Andrei Rogobete.
Speaker Bio:
Dylan Pahman is a research fellow at the Acton Institute for the Study of Religion & Liberty, where he serves as executive editor of the Journal of Markets & Morality. Dylan recently completed his PhD from St. Mary’s University, Twickenham on the basis of his published works on Orthodox Christian social thought and asceticism. He is the author of Foundations of a Free & Virtuous Society (Acton, 2017) and The Kingdom of God and the Common Good: Orthodox Chrisitan Social Thought (Ancient Faith, forthcoming 2025). In addition to Orthodoxy, his research also touches on the Dutch Neo-Calvinist Abraham Kuyper, the Anglican Christian socialist F. D. Maurice, and the intersection between ethics and economics. Dylan is a member of the Greek Orthodox Metropolis of Detroit and resides in Grand Rapids, Michigan with his wife Kelly and their four children.
This is a repost of a consideration of religious principles in political life by CEME Fellow, Professor Philip Booth, first published on the Catholic Social Teaching blog of St Mary’s University
The idea that government should be based on Christian principles is continually under attack – not least on several occasions in the assisted suicide debate. Not only is that proposed law itself incompatible with Christian principles, but many of those proposing it have suggested that Christians should not be involved in the debate or that Christian principles should not determine our views on the issue.
The atheist-humanist call to keep God out of the public square seems to resonate intuitively with many people today. Even some religious people seem to think that religion and politics should not mix. The argument is often made that, if only we have a broadly liberal state, then we can have a pluralist society in which people can practise their religion in private whilst it is kept out of politics.
But this argument fails, even at the level of logic – never mind the level of practice. Just consider the concept of a ‘broadly liberal and pluralistic state’. Such beliefs assume a set of values that must come from somewhere. Why, for example, a broadly liberal and pluralistic state rather than a totalitarian state or total anarchy?
In fact, we have a better answer to that question than atheist-humanists do. It is because we believe in God-given free will. And we also believe in original sin. So, we understand the dangers of totalitarianism and anarchy; and we understand why the state should serve individuals, families, and civil society and not the other way round.
The atheist-humanists (and their fellow travellers) argue that our politics and law should be based on reason and empirical evidence alone. They espouse this as a neutral world view. But it is not neutral. Arguing that there is nothing to life beyond reason, evidence and physical experiences is just as much an act of faith as believing that God is a reality who should influence our public life. Indeed, 90 per cent of the world’s population, and most of our country’s population, believe that there is something beyond reason and empirical evidence. And it is a matter of fact that our laws and institutions – including the monarchy – are based on Christian principles. The degree to which this was explicit in the coronation service for King Charles III was very notable.
And we can ask the question: ‘Where does government without God lead?’
Pope Benedict, in his address to parliament in 2010, said: ‘The central question at issue, then, is this: where is the ethical foundation for political choices to be found? The Catholic tradition maintains that the objective norms governing right action are accessible to reason…According to this understanding, the role of religion in political debate is not so much to supply these norms, as if they could not be known by non-believers…but rather to help purify and shed light upon the application of reason to the discovery of objective moral principles.’ In other words, faith and reason complement each other, and faith helps purify reason.
Indeed, as the same pope pointed out, when we try to perfect society by reason alone, we can end up with tyranny – as in the example of the terror of the French Revolution, or the millions killed by communist regimes. These were the result of radical atheists trying to build heaven on earth and ending up inflicting hell. We see this in smaller ways in the policies of modern-day atheist-humanists. They explicitly call, for example, for Catholic schools not to be funded by taxpayers – as if Catholics are not taxpayers and there can, somehow, be a school which has a neutral set of values. In reality, this is a call by atheist-humanists for state monopoly secular schooling dictated by their values.
A society built on rightly ordered religious principles is nothing to fear, even if you are not religious. We believe in original sin and so reject the idea that we can coercively build the perfect society or allow anarchy to prevail. We believe in free will and so do not want to build a theocracy. But we also believe in the God-given human dignity of all persons, so we reject the utilitarian idea that some people can be sacrificed for the greater good of the whole. And we also reject the idea that a free society should degenerate into a state in which the weak are simply left to fend for themselves.
If I were a non-religious person and realistic alternatives were put before me about how to order a state, I would choose this religious conception. We should not be shy in pointing out that our conception of the state is a great gift to the world.
So, this leads to the question: ‘What is the purpose of a government with Christian principles?’
There is much debate amongst Christians about how best to use the structures of the state to promote human dignity in a general sense. But worth mentioning in the context of recent debates is that human dignity is not protected if the lives of the most dependent, voiceless and weakest (for example, the unborn and the disabled) and those nearing death are not properly protected: human dignity applies to all. The common good is often thought to be (because even Christians tend to absorb a secular narrative by osmosis) a kind of substitute phrase for the ‘general welfare’ (as opposed, for example, to my own individual interests). But we are not Benthamite utilitarians. The common good is about what is good as well as what is common. The common good in the political domain relates to that set of common conditions which can lead us, individually and collectively, to effectively strive for perfection or fulfilment. And social justice, that often used – and rarely defined – phrase, is the form of justice that promotes the common good.
In the Catholic tradition, the role of government is to promote human dignity and the common good.
Again, there is the possibility for both misunderstanding and different perspectives here. But the first thing to say is that the idea of a society where everybody can reach perfection might not sound much better than the communist or French revolutionary ideal which ends in tyranny. It might sound like a theocracy, but it isn’t. We believe in free will and original sin. Our belief in original sin informs us that the power of government must be limited. Our belief in free will informs us that we do not really reach perfection until we can choose what is good. So, the role of government here is to develop institutions that nurture freedom in the best sense of the word: the freedom to choose what is good. The first of these institutions, of course, is the family; another is the Church and all her charitable works. Indeed, there has to be a wide variety of free institutions which have their own common good whilst contributing to the common good of the whole.
A government that allows violent crime, political corruption or rampant inflation or inflicts cruel punishments without the possibility of reform and redemption is not promoting the common good or human dignity. These point to obvious responsibilities of government. Whether, and to what extent, and in what circumstances, we should ban or regulate pornography, fatty foods or gambling or regulate labour markets are matters for what we call ‘prudential judgement’.
What might be the role of civil servants or government administrators in this scheme of thinking? I am a great fan of the TV series Yes Minister. Many civil servants regard it as a training series to help them do their job better. But it isn’t. It is the opposite. In fact, Yes Minister has academic roots. One of the authors attended seminars given by an economics Nobel Prize winner on the discipline of public choice economics: these seminars were about how interest groups and civil servants were able to pursue their own interests in a democracy against the interests of the people.
It is not the job of civil servants to set the policy agenda by imposing their views but to help the government implement policy. But civil servants can be tempted to pursue their own agenda. And there is a danger, of course, that good civil servants and regulators understand their role and fulfil it appropriately and with restraint whereas those with an agenda antithetical to the Christian one overstep the mark and pursue their own agendas and thereby abuse their powers.
As Pope Francis’s wrote in Fratelli Tutti: ‘Others may continue to view politics or the economy as an arena for their own power plays. For our part, let us foster what is good and place ourselves at its service.’
Civil servants do, of course, face tricky issues. What should they do if it is their job to implement legislation that is clearly immoral? Might civil servants be able to make secondary legislation better – from a Catholic point of view – by hiding something from the minister or telling him or her lies? What if a civil servant sees dishonesty and their job may be in peril if they report it?
After the financial crisis, many Catholics in business reflected on the Catholic cardinal virtues – this way of thinking has resonance amongst non-believers. They thought about how they should bring the virtues of courage, justice, prudence and temperance into their daily work. That is something that could be brought into the work of those who serve government too – perhaps by creating case studies.
We have the example, of course, of St. Thomas More who exhibited all these virtues and, in the end, had to choose to go against the king – and lose his head. Again, to quote Pope Benedict XVI: ‘In particular, I recall the figure of Saint Thomas More…who is admired by believers and non-believers alike for the integrity with which he followed his conscience, even at the cost of displeasing the sovereign…because he chose to serve God first.’
If we are going to bring God into government, Christians working for government should bring God into their daily work. Bishop Richard Moth, chair of the Catholic Bishops’ Conference of England and Wales said in his statement for the jubilee for workers: ‘I also ask Catholics to try to find some time for prayer during the working day – even if it is only a moment or two.’
Stalin asked how many divisions the pope had. If we truly believe that the world is governed by more than reason and empirical evidence, those who work in government should never forget to call upon our heavenly divisions in daily work: including, of course, for the intercession of St. Thomas More.
Philip Booth is professor of finance, public policy, and ethics and director of Catholic Mission at St. Mary’s University, Twickenham (the U.K.’s largest Catholic university). He also works for the Catholic Bishops’ Conference of England and Wales as Director of Policy and Research.
Cover Image: Created using ChatGPT
