The Hebrew Bible is a unique and remarkable source of ageless knowledge in many subjects. In addition to its theological and philosophical virtues, it contains many storylines about the history, customs, traditions, and laws in the promised land. And although the Bible cannot be considered a precise textbook on the abovementioned subjects, it contains essential imprints of the memory of the ancient people and their way of living. I always was fascinated in economic interpretation of the Bible. On what legal and economic principles did God intended to shape a human society? Were there any economic concepts that can be understood from the point of view of modern science?
The main features of man and the economic principles of society are clearly emerging from the first pages of the holy book. In Genesis, God was depictured as the creator of all things; he established the laws of nature, and through them he created the universe, earth, flora, fauna, and, finally, man. Creative and productive work was conceived by God as a form of human existence. Accordingly, God is the creator of the world, and man is the creator in the world. Since man was founded in the image of God, he was predisposed to various skills inherent in the creator, which should be used efficiently to sustain his life. This theologically implies that every man received a piece of unique abilities from God, which serves as the basis of organic inequality that drives the processes of the division and cooperation of labor.
Unlike in Mesopotamian creation stories, in Genesis, God did not create people as slaves; instead, they were granted freedom. They were hired afterward as workers, bound by contractual obligations with the employer – God himself. Even in paradise, the first people did not lead an idle lifestyle. Depending on the nuances of translation from ancient sources, Adam and Eve were either cultivators or curators in the Garden of Eden. In any case, they had to dedicate some time to productive work.
Paradise was an affluent place, but it too could be characterized by the category of scarcity. The time was a scarcity as Adam and Eve had to distribute it between the work and recreation rationally. The fruits of the Tree of Knowledge and the Tree of Life were unique, rare, sacred, and banned from consumption. Moreover, Adam and Eve were duly owners of their bodies and places they occupied in any particular moments of time. But not only that. Humans were endowered by their own state of mind, so even God had trouble to impose his will on humans. In other words, scarcity is a natural phenomenon, and even paradise was not an exception.
With the advent of the first people, the question arose of maintaining social order. It is known that the scarcity of goods and simultaneously occupied places in conjunction with the individual consciousness that governs one’s wants inevitably could lead to the conflict between people. The biblical text encourages readers to realize and accept that the cornerstone of conflict avoidance and peaceful coexistence is the respect for others’ property rights. As God was the ultimate creator and appropriator of the universe, he undoubtedly was the full-fledged owner of everything on earth and in heaven. He had every right to dispose of his property at his discretion. God outlined the rights and obligations of Adam and Eve, prohibiting them from the use of the fruits of the one-of-a-kind Tree of Knowledge of Good and Evil.
In the Bible, private property is elevated to the rank of the sacred, and its violation is punished severely. God even frightened the first people that if they taste the fruit of the forbidden tree, they will die. And nevertheless, despite this, it must be admitted that the very first attempt to establish a social order was a failure. Adam and Eve bridged the contract almost immediately, thus violating God’s private property rights. Even though God did not kill Adam and Eve, he sentenced them to cruel punishment, which had a significant economic component as well. “And to the human he said … the ground is cursed on your account. You’ll eat from it with suffering all the days of your life. And it will grow thorn and thistle at you, and you will eat the fields vegetation. By the sweat of your nostrils you’ll eat bread…” (Genesis 3:17-19).
Accordingly, the original sin was the sin of violation of private property rights. The protection of the private property was understood as an essential element that motivates humans to engage in the innovative and creative process and guaranteed a peaceful social order. The same concept had been yet again articulated and included in the Ten Commandments: “You shall not steal” and “You shall not covet your neighbor’s house… his ox or his ass or anything that your neighbor has.” (Exodus 20:15,17).
The Bible teaches the ways of a peaceful resolution to the conflict through the example of the saga of Abram and Lot. The dispute between Abram and Lot arose during the original appropriation of the land. “And the land did not suffice them to live together, because their property was great, and they were not able to live together.” (Genesis 13:6). Abram suggested departing their ways in order to avoid quarrels between brothers and their herders, “Separate from me: if left then I’ll go right, and if right then I’ll go left.” (Genesis 13:9). As we can see, collectivism was not considered as a solution, but rather the appropriation of individual plots of land and regard to the private property of others was the Bible’s answer.
The Bible clearly demonstrates that not all skills and work performed would be appraised equally at all times. For instance, Cain toiled the land, and his brother Abel was a herder. One day “Cain brought an offering to LORD from the fruit of the ground. And Abel brought, as well, from the firstborn of his flock and their fat. And LORD paid attention to Abel and his offering and did not pay attention to Cain and his offering. (Genesis 4: 3-5). In terms of modern economics, this passage can be interpreted that the value of the good is determined not by the time spent on its manufacture, but by a subjective assessment of the utility of the good on the market in a certain period of time. In the Marxist world, God would have shown an equal appreciation for both offerings. Or as an alternative, he would have chosen Cain’s donation as it is more time-intensive, and according to the Marxist theory of value would be more worthwhile.
The Bible unambiguously warns about the threat of power concentration in the hands of the state and inefficiency of government intervention into economic affairs. The evil nature of centralized authorities was revealed by the prophet Samuel. He scolded Israelites when they decided to follow a world trend and request a king as their neighbor had done. The narrative described a transition from the period of the biblical judges to the institution of a kingdom under Saul. “These will be rights of the king who is to reign over you. He will take your sons and assign them to his chariotry and cavalry, and they will run in front of his chariot… He will make them plough his ploughland and harvest his harvest and make his weapons of war… He will take the best of your field, of your vineyards and olive groves and give them to his officials. He will tithe your crops and vineyards to provide for his eunuchs and his officials… He will tithe your flocks, and you yourselves become his slaves. When that day comes, you will cry out on account of the king you have chosen for yourself, but on that day God will not answer you.” (1 Sam. 8:11-18).
In other words, the prophet urged that the principles of inviolability of private property and the ability to freely dispose of it contradict the principle of centralization of power in the hands of governmental officials. Samuel had not even hinted that a state would somehow be a guarantor of the untouchability of private property and enforcer of social order. Thus, a state could not smooth out the causes of social conflict but also would strengthen it to some extent. And such troubles that people poured on their heads cannot be corrected even by calls to God.
There are lots of examples in the Bible that support the existence of free-market relations among people until one runs across controversial Jubilee laws. From the first glance, these laws run counter to the libertarian understanding of economics but suit nicely with the egalitarians’ point of view. It seemed that people were deprived of the free land market – the main factor of production in ancient times. The land purchase was declared to be a temporary transaction, “But the land shall not be sold permanently, because the land is mine, because you are aliens and visitors with me!” (Leviticus 25:23).
Thus, one of the principal decrees of the Jubilee is that land purchase transactions during the previous 50 years are nullified, and all countryside real estate reverts to its owner without any compensation. Besides, all slaves must be released. These bailout laws, if understood literally and widely applied, can seriously hinder the economic life of people, as they will restrain commercial initiative, prevent the accumulation of land and human capital and, as a result, slow down economic growth. Moreover, practical enforcement of these laws on a large scale for every real estate and land sale would lead to severe difficulties. Just imagine a sheer number of transactions needed to be accounted for and then reversed to establish proper former owners of the property for the duration of the last 50 years. There would be a magnitude of sharp disputes among transaction agents that would have shaken society from top to bottom.
From the economic point of view, these laws do not have any sense, unless one pays attention that these laws touched a particular kind of situation – a bankruptcy of the household. If considering Jubilee laws in this framework, it is plausible to suggest that they were a biblical version of Chapter 11 bankruptcy law. The seller only sold the use of the property; that is, he rented out his land for the lump sum amount upfront. The price was estimated by the projected amount of agricultural yields before the Jubilee. Therefore, it becomes clear that when “your brother will be low,” in other words, declare bankruptcy, the land went under the new lease management, where a bankrupt could become an employee with “benefits.” It is said, “And when your brother will be low with you so that he is sold to you, you shall not have him work a slave’s work. He shall be like an employee, like a visitor, with you …You shall not dominate him with harshness, but you shall fear your God.” (Leviticus 25: 39-43). In that sense, the sell was not permanent as the decrees outlined a way out of bankruptcy either at the expiration of time or when improving the financial position before the maturity date. But in any case, the debt was not forgiven but was restructured and paid off.
Egalitarians have always mistakenly assumed that over time, inequality would result in the impoverishment of the entire population, except few elites that accumulated all wealth. They regard Jubilee decrees as a way to achieve a certain degree of equality in society by means of wealth redistribution and supposed debt forgiveness. But, in line with the out-of-debt mechanism discussed above, it could be concluded that wealth redistribution was not implied in the Jubilee laws. Jubilee laws, on the contrary, protected the private property of the household in dare straits situation as the property title did not pass into the hands of the buyer but remained with the seller.
The Bible describes a human society in exciting times, that is, the transition from hunting and gathering to agriculture, sedentarization and original appropriation of land, the introduction of state, and formation of mechanisms of peaceful coexistence between the members of society. Thus, starting already in Genesis, God established such socio-economic conditions that are well described in terms of the market economy and especially in the Austrian understanding of it. These are primarily such essential elements as private ownership of the means of production, the inviolability of private property rights, scarcity of resources, productive work, organic inequality, division and cooperation of labor, the voluntary and free exchange of goods, state non-interference in the economy, and market pricing. These key concepts completely fit the paradigm of the Austrian School of Economics, which posits that human action by itself creates and regulates markets, and respect for private property rights is a foundation for peaceful social order. In this sense, the Old Testaments portrayed God not only as an omnipotent deity but also revealed in him an Austrian economist by trade.