Update--October 25, 2001

Investing During A War Of Religious Ideas

The August 6, 1994 edition of The Economist magazine contained a sixteen-page special section entitled: "Islam and The West, The Next War They Say." Over the years, I've copied it several times to share. For it explained that true Islam, as opposed to the terrorists, and we spiritual investors in the West may share holy ground upon which our political leaders might find common ground for peace.

A section entitled "The Cash-Flow Of God" described it this way: "The good Muslim businessman should be guided by conscience--and by God's written instructions--to do the right thing by other people. There are obvious difficulties in this. But these difficulties are not peculiar to Islamic economics. They are shared by the people in the West who are trying to construct a new socialism, a de-Marxified alternative to the politics of pure individualism. These westeners also accept the market as the essential driving-force of any economy, but they too wish to set it within a moral framework that will ensure support for the weak through the compassion and self-discipline of the strong."

The report began: "The idea, Islam, ignores the frontier that most people draw between man's inner life and his public actions. It may be the last such idea the world will see. Or it may, on the contrary, prove to be the force that persuades other people to rediscover a connection between life and a moral order." It continued by describing the soil from which the West and Islam grew: "The Reformation released the great surge of individualism that created the modern West, including what we now call capitalism and democracy. But for the first two centuries this new dynamo of individualism operated inside a still generally accepted body of Christian discipline. Then, in the 18th century, this sort of discipline began to break down...[But] the distinguishing feature of Islam, which at the moment separates it from all of today's other would-be global cultures, is its belief not only that man's day-to-day life is surrounded by an invisible [spiritual] life but also that the two have to be kept in connection to each other. The West held the same combination of beliefs until not long ago; but at some time during the present century most people in Europe and many Americans have ceased to make such a connection. If the West puts the two together again, it may have a better chance of solving its own problems."

That 1994 article rang true to me as I had been invited to teach biblical principles of political-economy in Uganda the year before. Uganda had been destroyed by Idi Amin and was about to hold a constitutional convention to begin the rebuilding process. As Uganda is most religious, the Church of Uganda and the Church of England sponsored a two-week symposium to discuss how Christianity might play a role in that process. When I arrived, I was essentially told the many Christian evangelists in the country from the West knew how to get Ugandans into heaven but didn't seem to know how to pour the moral foundations of a political-economy, as Moses and other patriarchs of the Bible had done. Meanwhile, Islam was offering to build not only mosques but banks that didn't charge interest on loans, as the Koran suggests.

I knew that the Bible advocated the same concept but that the Protestant Reformers had essentially changed it for western Christianity almost five centuries ago, thereby enabling modern banking, capitalism and rapid economic progress. (The founder of my denomination, Martin Luther, preached so often on economics and money that a book of his sermon excerpts that I'm reading contains seventeen pages on the subjects. Four of those pages concern Luther's views about when interest can be charged, his belief that it should be limited to 5% and his view that oppressive loans must be forgiven out of Christian love.) I also knew that many modern Islamic bankers essentially find ways around the prohibition against charging interest, just as many Jewish and Christian lenders did centuries before Luther. But while most of us in the West don't worry about earning as much interest as possible, we should be aware that the central bankers of Uganda were struggling to make interest payments to western financial institutions. And the Ugandan leaders, along with many of their fellow third world leaders, were rather impressed that Islam considered their plight to be a matter for Allah's attention.

History is all too clear that fanatical devotion to such religious sentiments can bring out both the best and worst in people. If we're to avoid the worst during coming years as these sentiments reassume a more central role in world affairs, we might reflect on those sentiments that many Muslims and Christians share. For example, when the Taliban assumed control of Afghanistan, it began by hanging televisions from trees. That was its way of saying it rejected many Western values that it feels are being exported to an unreceptive world. While hanging televisions is extreme, the sentiment behind it is shared by many conservative Christian parents, and many American parents in general. Also, the growing number of us "socially responsible" or "values-based" investors in the West are essentially reconnecting our spiritual and moral beliefs to our investment activities. We should therefore appreciate that many Muslims prefer mutual funds, like the Amana Funds, that will not finance banks that charge interest, pork processors, alcoholic beverage companies, cigarette manufacturers and so on.

Finally, all peace loving Americans might acknowledge that when the terrorists struck at the World Trade Center, they did not strike at a symbol of our domestic economics, such as the New York Stock Exchange. They essentially struck at the symbol of an ostensibly religious nation that is comfortable disconnecting, or compartmentalizing, our religious beliefs from our economic activities and thereby exporting both missionaries and adult entertainment to the rest of the world.

Even friendly western observers have expressed concern about our comfort worshipping both God and mammon. Columnist William Pfaff has written: "The United States remains the most religious of industrial nations in terms of avowed belief in God and regular church-going, but religion has lost virtually all serious cultural and economic influence." The Wall Street Journal has observed that Christian financial planners do little different than secular planners. Billy Graham essentially explained that dichotomy exists in our land due to the split consciousness in our minds when he quipped: "Many leaders, I'm afraid, place their religious and moral convictions in separate compartments and do not think of the implications of their faith on their responsibilities." Dr. Bryant Myers of the Christian ministry World Vision has written: "This framework of separated areas of life is also deeply embedded in the Christian Church, in its theology and in the daily life of its people. On Sunday morning or during our devotional or prayer life, we operate in the spiritual realm. The rest of the week, and in our professional lives, we operate in the physical realm and, hence, unwittingly act like functional atheists."

Functional believers basically make the connections that allow the spiritual realm to infuse their secular activities. They also make a special effort to see the connections between their daily activities and the daily headlines. As Chaos Theory puts it: "When a butterfly flutters its wings in one part of the world, it can eventually cause a hurricane in another." For example, I visited Nassau a couple weeks after the attack on New York that had been masterminded by those in Afghanistan. So many waitresses, cab drivers and hotel employees had lost their jobs due to the drop in tourism that a major Bahamian insurance company had suspended its collection of premiums for six months as people were simply allowing their policies to lapse. Indeed, in our very interconnected world, the poor in developing countries are often most vulnerable to fluctuations in other parts of the world. Fortunately, the good news has long been that God or Allah brings order out of chaos when people choose to be connected by love rather than hate. So for many years, I've advocated that my more affluent clients keep a small percentage of their investments in mutual funds that responsibly finance the developing nations.

On a purely financial basis, that's been a break-even recommendation for several years. And it looked particularly bad until many of our technology stocks dropped ninety percent. But if we can see the connections in the larger picture--from God or Allah's perspective if you will--we might see that our world, including America, might be a more prosperous and peaceful place had more affluent Americans done the same rather than chase Internet stocks. The September 22nd edition of The Economist said: "Stockmarkets need to fall, not just to reflect the prospect of recession but also to correct their previous overvaluation. More generally, the American and world economies are suffering from overcapacity. Although governments should soften the pain of recession so far as they can by expanding demand, market forces are the best way to eliminate excesses in supply. They are also the best response to an attack that was, in one sense, aimed at the free-market system itself (emphases mine)."

Since the Garden of Eden, the great religions of the world have told us that to be truly free, markets must be responsible, operating with minimal fear and greed. We can have too many trees from which to choose our daily apples. And right now, The Economist believes we are "suffering" as we have too many apples from overinvesting in trees last year. Yet much of the world is growing increasingly irritable as it could use a few more apples. It might be most prudent if we'd plant a few of our excess seeds in their orchards. We might yet be enriched ourselves for patiently doing so. For while American stocks have been falling under the weight of inventory accumulations and still historically high price/earnings ratios in the mid-twenties, India's economy is projected to grow by a much needed six percent next year while its stockmarket sells at just over six times earnings. Similar or larger imbalances exist in the economies and stockmarkets of Australia, China, Hong Kong and Indonesia.

The Bible reminds us that somewhere between our over-flowing land of unwitting functional atheists and the poverty-stricken theocracy of Afghanistan, there is a promised land. It is a land where free people consciously practice St. Paul's "moderation in all things" mundane as they lovingly connect spiritual sensibilities to their daily activities. It is a land that our post-September 11th world yearns for as we approach another holiday season. As always, we will reflect on self and society, as well as make new resolutions for a better future. This season, my fondest wish is that more of us in the West discover new connections between our spiritual and financial lives while those is the East discover those progressive religious ideas that make all of us richer. After all, the true reason for the season is to connect with the one who said he lovingly invested a few years between East and West so that all the peoples of the earth might have life and have it more abundantly. Peace.

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