Law and Dominion
How the Christian Will Reconquer through Economics: The Problem & the Very Great Hope
Professor: Dr. R.J. Rushdoony
Subject: Law
Genre: Speech
Track: 06
Dictation Name: RR264A1
Location/Venue: ________
Year: _______
[Clint Miller] Good morning everybody, my name is Clint Miller and both my wife Elizabeth and I would like to welcome all of you to the second annual Northwest conference for Christian reconstruction. Can all of you hear me okay? We’re very gratified to have so many people; I think this year we have more than twice what we had at last years conference. And I know that some of you have come from very distant places, I think there are some people here from Florida today and also Alaska! And some places in between as well.
Our first break will be at 10:30 for thirty minutes and coffee and tea and I believe cookies also will be served here in this room. Lunch will be served at 12:30 and then we’ll meet back here at 1:30. Another thirty minute break is scheduled at 3:00 and then at 5:00 o’clock we will set aside some time for questions and at 5:30 we will officially adjourn. But we will be able to stay in the room for thirty minutes or so, maybe a little bit longer. Just to talk among ourselves. Um, I should mention our restrooms are located -some of you have already found them but if you go down the steps outside the entryway to the ballroom and turn right there is a sign that points downstairs to the restrooms. And there also are a set of restrooms upstairs on the mess and eat.
Our purpose for these conferences continues to be to bring people interested in Christian reconstruction together under God to learn, to discuss, and to meet and pray together. We plan to continue the conferences and anticipate future ones to be on law, the family, education, the church, health and medicine perhaps, and government.
Last year I mentioned at the beginning of the conference that we in the northwest are blessed by a very beautiful environment that is marred perhaps only slightly be erupting volcanoes... [audience chuckles grimly] But spiritually it has been very dormant. Now we still have our erupting volcanoes, in fact, something happened yesterday I guess I’m not exactly sure what at Mount Saint Helens; but we also hope and pray that God’s cause is steadily strengthening here.
There are many books for sale which I think all of you are aware of at this point, down by this end of the room, and we hope you have time during the breaks to peruse these. The second volume of Doctor Rushdoony’s Institutes of Biblical Law called Law and Society is just off the press, as is also another book by him called The Roots of Inflation. If any of the books are sold out during the day, which I imagine some of them will be, we will have a notebook down there where you can sign up and we’ll see that that gets sent down to Chalcedon.
Also, I encourage you to look among the literature, on the tables adjacent to the book tables. There are some really interesting items there, including some information of the Chalcedon tape ministry also...okay.
At this time I’d like to ask Mr. Joe Green to step forward and he will give the invocation.
[Joe Greene] Shall we pray? Almighty God, our heavenly father. As we assemble to hear your servants today we delight to acknowledge you as the only true and living and sovereign God. Now, our father, we confess that we have a great deal to learn, a great deal of land to possess in our walk with you, a great deal of learning as to how to live out our profession of faith in Christ. To the end that you might be honored in each of our lives as we have one bond in your son, our redeemer, we pray that you will bless this day’s teaching and ministry to the deepening of our walk with you. Help us, O Lord. And now, with thanksgiving to you for this opportunity to meet together we commend our way, we ask for your blessing upon our speakers, your use of them to the honor of your name. Be with us, we pray through Jesus Christ. Amen.
[Clint Miller] Okay, and at this time I’d like to call on Judge Beers, who will introduce our first speaker. Judge Beers?
[Judge Beers] What a joyous occasion! And all the people said?
[audience] Amen!
[Judge Beers] The question came to my mind, how does one properly introduce our first speaker. How do we decently recognize and acknowledge the fact that within his lifetime he has written and published nearly thirty books, innumerable monographs and articles, the majority of the latter appearing from time to time in the Chalcedon Reports and the Chalcedon position papers. How do we express our gratitude for his unselfish attitude in not only permitting the reproduction of the copyrighted work of his hands but also actively encouraging its wide distribution by others in their own spheres of influence. What can be said in an adequate manner about his courage and his aggressiveness in accepting and acting upon the challenge that God gave to Ezekiel in the twenty-second chapter.
Where he was seeking a man to stand in the gap. And in Isaiah in the sixth chapter, when he sought a messenger to carry his clear word to the people. How do we present one who is, whose strength is in quietness and confidence in the Lord. A man whose life manifests this truth. Well. Maybe in a sense to paraphrase our speakers own words “it will not be done acceptably with pious gush.” [audience laughs] Rather, we can do it by pointing out that Doctor Rushdoony’s life manifests that which the Lord speaks to us in Psalms 3:7, verses 23:24, 3 ,and 31. “The steps of a good man are ordered of the Lord and he delighteth in his way. Though he fall he shall not be utterly cast down, for the Lord upholdeth him with his hand.” “The mouth of the righteous speaketh wisdom and his tongue talketh of judgement. The law of his God is in his heart and none of his steps shall slide.”
It’s trite to say that it’s a pleasure to introduce Doctor Rousas John Rushdoony. It is a blessing to me to be able to do this.
[audience applauds]
[Rushdoony] Our subject in this first section is How the Christian Will Reconquer through Economics; The Problem and the Very Great Hope. We shall be laying the theological foundations in this first session so that we can consider the problem more carefully in the subsequent hours. I think it is obvious that economically we are in trouble. That economically our country in the world today represents an entrenched stupidity. The extent to which our world has drifted off into bureaucratic and statist insanities comes home to me constantly as I go to court rooms where churches, Christian schools, Christian parents, and Christian school children are on trial.
Earlier this week I was not entirely sure I was going to make it here because I was in Texas to testify at a trial and the air traffic in the state was halted by tornadoes which were all around the state, were not dissipating, had disrupted all air traffic, and to confound matters even worse my flight reservations were on Braniff. [audience laughs] But at the trial I saw what I have seen again and again. The extent to which our modern world order has departed from sanity. The church was on trial because in their nursery for their Sunday morning worship services and for their Monday through Friday nursery school they had not only failed to secure a license from the state -which on principle they refused to do- but they had in that nursery an innocent bowl of goldfish. They were cited for that bowl of goldfish because there was no veterinary doctor certificate on the wall behind the goldfish to indicate that that species of animal life had been examined by a doctor and properly inoculated.
And for that, a church was in court. Now it’s people like that who are giving us the economics we have, so we should not be surprised at what we are getting.
Before we embark on the theological foundations I’d like to read a passage of scripture that is particularly relevant. As I do I’d like to call attention to the fact that this passage like so much else in the bible has been filtered to us through centuries of Hellenic thought. Of the philosophy and faith of ancient Greece. We cannot understand Greek thought if we fail to appreciate the fact that for the Greeks the world of mind or spirit was a higher realm and the material world a lower and inferior realm. We are often told about Greek science and Greek inventions; what we are not told is that the men who produced those inventions were almost invariably slaves! Brought in from other countries, given Greek names, who produced everything worthwhile in Greece.
“Because for any good Greek to deal with things that were in the realm of matter and practicality was emphatically lower class. Now to this parable in Luke 16:1-13 which a century ago Dean Alfred said was perhaps the most misunderstood parable in scripture and certainly one of the misunderstood texts. To read.
“1 And he said also unto his disciples, There was a certain rich man, which had a steward; and the same was accused unto him that he had wasted his goods.
2 And he called him, and said unto him, How is it that I hear this of thee? give an account of thy stewardship; for thou mayest be no longer steward.
3 Then the steward said within himself, What shall I do? for my lord taketh away from me the stewardship: I cannot dig; to beg I am ashamed.
4 I am resolved what to do, that, when I am put out of the stewardship, they may receive me into their houses.
5 So he called every one of his lord's debtors unto him, and said unto the first, How much owest thou unto my lord?
6 And he said, An hundred measures of oil. And he said unto him, Take thy bill, and sit down quickly, and write fifty.
7 Then said he to another, And how much owest thou? And he said, An hundred measures of wheat. And he said unto him, Take thy bill, and write fourscore.
8 And the lord commended the unjust steward, because he had done wisely: for the children of this world are in their generation wiser than the children of light.
9 And I say unto you, Make to yourselves friends of the mammon of unrighteousness;--”
Now the term mammon of unrighteousness was an idiom of the day which we have in English today as filthy money. Because it was commonly regarded as filthy. And the term mammon of unrighteousness is exactly the same term.
“--that, when ye fail, they may receive you into everlasting habitations.
10 He that is faithful in that which is least is faithful also in much: and he that is unjust in the least is unjust also in much.
11 If therefore ye have not been faithful in the unrighteous mammon, who will commit to your trust the true riches?
12 And if ye have not been faithful in that which is another man's, who shall give you that which is your own?
13 No servant can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.”
Now first of all this is called the parable of the unjust servant, or the unjust steward. That is very wrong. He was not unjust, the parable never says so, he was wasteful! And there is a difference. He was not a competent steward by and large. The Lord ordered an accounting, the steward to prepare for employment after his discharge went over all the accounts receivable and discounted them by about fifty percent. As a result he had a great many very grateful people all over the community, men of substance. He had assured himself of a position with them after his discharge.
Now comes the matter that is surprising to so many people: why did the lord commend the man? Why did he praise him? Why does our Lord say the children of this world are wiser than the children of light, and why, even though he says you cannot serve both God and money he also says you must learn how to use it wisely! Or else who will trust you, including God, with anything else?
Our Lord’s point is the commendation of practicality and of prudence. Our Lord commends practicality and he condemns an otherworldliness that pays no attention to matters of practicality and money in this world. It tells us something about our culture which is still very Hellenic Greek in its character in that although every one of us beginning as children deal with money, with economics, at no stage in our education K-12 nor in nine hundred and ninety-nine universities and colleges out of a thousand is economics ever required. Perhaps we should be grateful for that because what is taught as economics is certainly not deserving of that name.
But it tells us something about our lack of reality, in fact, the two key subjects that we have to deal with all our lives, law and economics, are at no point required by any student. Is it any wonder that modern man is incompetent as he faces the world? Is it any wonder that our politicians face the pressing problems of our time with incompetence, or that with social security likely to be bankrupt by next year, August, we have so many men in Washington insisting the problem does not exist? All that needs to be done they say is make an appropriation out of the general fund. Well, what’s happening to the general fund?
Our Lord commends practicality. Our Lord requires a faithful stewardship of money from us, not on the same terms as this steward, but he says the steward knew what money could do for him! And we need to recognize what money, what economics, means to us! If we do not we are building disaster into our lives, into our institutions, and into our countries.
Now there are two approaches to economics, two basic approaches. One so humanistic, it is a do it yourself world, a multiverse not a universe. There is no law, there is no order in the universe and man therefore can create by fiat everything in his world. And so, we have fiat money, we have fiat economics, we have fiat laws, laws that have no relationship to the moral order in the universe. In every area of life the humanistic fiat governs us today, and it is a prescription for disaster.
Last week I was in Washington, DC. I heard a congressman say in our council meeting, it was congressman Jack Kemp, and he spoke of the coming monetary crisis. And he made this statement: “Either we will monetize gold or very soon gold will demonetize the paper dollar.” That’s what we’re facing, and very few are aware of it.
The other approach to economics and to life generally is theistic. Biblical. We have a given order in the universe, we have a given laws in every sphere, and if we try to go contrary to those laws whether they be the laws of physics or economics there is built in disaster in the very nature of things so that man’s only hope is to live in terms of the nature of reality which is God created, law regulated, so that as the ancient Hebrew proverb has it: “Whoso breaketh a fence a serpent shalt smite him.” Meaning that even as fences then were hedged fences and were a place of burrs and poisonous snakes -cause that was where the food was- and anyone who tried to break through a fence in order to let his cows into his neighbor’s field was taking the chance of a snake bite.
And so the proverb tells us, likewise when we break the fence of God’s law we are smitten. And the bible pronounces blessings and curses upon us for obedience or disobedience to God’s law. What we face today is a world economic crisis, among other crisis. It is a crisis for the present world order, for the humanistic order for the world of man made fiats. And all our current efforts to resolve the growing economic crisis begin and end with the premise that man made -statist made- solutions are possible.
Hence we have more planning, more of man made fiat rather than a return to God’s order and to freedom. The result is a growing bad news. Last November we passed in our federal deficit a trillion dollars. We have for this fiscal year and for the budget which is in process now a likely deficit -no matter what the administration says- of a hundred billion that very competent economists have estimated that it will be in the calculation of off budget items two hundred billion!
At the same time there is no money in the banks for you to borrow. They may complain in Washington about high interest rates, as though that were a purely artificial device, but the fact is inflation rates are reflected in interest rates! You’re not going to loan out money at a loss. You have a high interest rate if it is more than one and a half percent above the inflation rate. If you lower it below one percent of the inflation rate it’s very cheap money. But the banks do not have the money to loan. Why?
Because today eighty percent of the money put into savings accounts is borrowed by the federal government to meet it’s deficits. What is left then for industry in the way of capital? In order to expand or develop it’s operations. Money is not now available for private enterprise. Moreover the bankruptcies in nineteen eighty-one were five hundred and twenty-two thousand and the indications are that in nineteen eighty-two it will be much higher. Last month, April 15, eighteen and a half million Americans according to the Wall Street Journal filed their income tax reports and paid nothing because they had no money to make their income tax payment.
Eighteen and a half million. Meanwhile you have a growing tax revolt as well because people simply, whether they agree with the tax revolt or not, have had it and are fed up with what is going on. The farm loan delinquency is approaching sixty percent, meanwhile one area after another is becoming so costly... homes, cars,... that they are being priced out of the market for most people. How many people can afford a new home today? In one city an estimate was made of how many actual homeowners could afford to buy their homes today at the current value of the home. Ninety percent of the homeowners could not afford their homes today!
Most young couples are priced out of the new car and new house market, and a lot of us who are older too. This year we saw energy costs rise in terms of inflation, and energy is pricing itself out of the market. In areas that are cold, including ours, a lot of us were burning wood because we have wood available and we’re buying long johns or ski underwear in order to avoid turning up the thermostat or turning it on. Meanwhile, because people cannot afford to operate their cars fifty oil refineries have been shut down and the rest are operating at sixty-three percent 4of capacity.
We have been living in terms of debt, and debt living now is in crisis. By nineteen-eighty, according to Wice, the total debt in the United States was 4.4 trillion dollars in bonds, mortgages, and loans. The corporate debt was one and a half trillion, the federal debt at that time was still 949 billion and it is now past a trillion. Building mortgages came to 1362 billion in debt. Add to that the debt of cities, counties, and states... the corporate scene is one of disaster. Of the five hundred major corporations, industrial corporations listed annually by Fortune four hundred and ninety-nine have a liquidity crisis. They’re head over heels in debt.
General Motors, the biggest industrial corporation in the United States in nineteen seventy-three of every dollar of net profit paid out thirty-six cents to interest. By nineteen seventy-nine, still a good year for general motors ninety-three cents out of every dollar of net profit went just to pay interest not principal. Your can see the crisis.
And where are they going to borrow more money when eighty percent of the available money is now taken by the federal government?! We have two major trends. One, a tremendous mountain of debt. We have bankrupt nations and bankrupt people, and no funds for growing anything. The stage is set for bankruptcy, a money panic and a collapse. But second, the federal government is determined to run up greater deficits. President Reagan has called a deficit a good thing... it was bad when he was candidate Reagan and now as president Reagan running up a deficit it suddenly has been converted into a good thing.
And most Americans are demanding that Washington do something so we have a built in prescription for more inflation, as though this were the answer. And so as we face bankruptcy our attitude is not “we’re going to have to pay for our sins” but “let us try to defer with more inflation the payoff for our economic sins”. The fact of debt is central to our worldwide economic crisis.
Men and nations have alike borrowed against the future and now they are running out of future! The socialist countries have an answer: monetary reform. On a given day, all currencies are exchanged for a new currency, the old rubles for new rubles, at a ratio of ten to one, a hundred to one or whatever the case may be in a particular country. But in time, the new rubles also disintegrate and countries facing massive inflation want -as countries often do- some kind of cheap answer out of the crisis. Cheap in terms of irresponsibility.
We do know that the Falcan Islands have a tremendous oil potential; we need to know also that Argentina went into this with an inflation rate of one-hundred and forty percent. And now the people are caught up in patriotic fervor and hatred of Britain. But they have, at the same time, withdrawn their moneys from the bank. So interest rates have shot up to two hundred percent. Now think of doing business under conditions like that! Because you’re looking at what may be the near future.
People who are debt ridden, as most people are today, have a vested in4terest in more inflation! The free market provides an alternative bankruptcies but it does not eliminate the debt problem, it penalizes others. All debts have social implications and effects, when a factory closes it is not only the thousand men who worked there who are out of work, but the suppliers, and the stores where those people traded. The domino effect is considerable. And the sad fact is that while our problem is debt- personal, corporate, and especially federal statist, most people see more debt as the answer, as the solution rather than more problems. After all if you’re a corporation and you’re paying out ninety three cents of every dollar of net profit just in interest of your loans, nothing on the principle, you will want more inflation. Because how else are you going to pay off the debts except with bad money? And how else are people who are debt ridden going to get out of their holes?
I was in Michigan three weeks ago for a trial, I was there for a week. In a great convention a hotel that looked like a morgue there were so few there. The thing that interested me as I asked people what was happening there was that they said this is worse than the depression because the workers then did not have a mountain of debt on their backs and now everybody owes for everything... and they’re scared to death. The captain of the Braniff plane I was on had a house to make payments on and a summer cabin up in the mountains to make payments on and I don’t know what else. Consider his predicament, multiply it by millions.
Proverbs 22 verse 7 tells us “The rich rules over the poor, and the borrower is servant to the lender.” Both halves of that proverb mean the same thing, and the meaning of the rich there is those who are debt free. Deuteronomy 15:6 says “The Lord thy God blesseth thee as he promised thee, and thou shalt lend unto many nations and shall not borrow, and thou shalt reign over many nations but they shall not reign over thee. The bible limits debt to six years, and as a general principle we are told by Paul “Owe no man anything save to love one another.”
That is the product of improvident living on the national and the personal scale. It reorders the economic scene and it penalizes the thrifty and helps the debtor. It alters the moral outlook of a people. It begins in bad morality and it produces even worse morality. The Christian thus, by way of conclusion, must recognize that God’s judgement is inherent in all things. The wages of sin always have been death. For persons and for economics.
We live in a doomed order, we will be affected. But we must recognize the judgement, the economic judgement, that faces us is from God and it is a salvation judgement. The ground will be cleared for righteousness. Second, and finally, we must recognize that reconstruction requires recapitalization and recapitalization first of all means that we must capitalize ourselves. Not only in terms of gold and silver, house, land if we’re farmers, the tools of our trade, but recapitalization is also religious and moral. We must get back to ways of thinking that are oriented to hard money, to work, to thrift, to character, to capitalization across the boards.
This is our concern at Chalcedon. The creation of a new people to live in a Christian order. [audio ends]