One of my concerns about Economy of Grace is that
most people who read it will probably not know economics or
economic history, and will be persuaded by the avalanche of
theological arguments that, among other things, private property is
unnatural and contrary to God's ordering of the universe, profits
are the result of workers being paid less than they are worth,
global capitalism is the cause of poverty in the underdeveloped
world, and, in the author's words, "capitalism is prone to
recurrent crises, crises that can be stopped only by the external,
nonmarket intervention of government."
 In the first half of the last century the economist Joseph
Schumpeter predicted the downfall of capitalism, not because of
inherent weaknesses, but because of its very success in creating
economies so strong that more people in a society will be freed
from the need to labor mightily just to survive. Some people
thus freed will become an intellectual elite that will be actively
hostile to the very system that makes their ivory-tower existence
possible. This book provides strong evidence that Schumpeter
 Tanner presents the interior life of the Holy Trinity, a life of mutual infinite, unconditional self-giving love, as the model on which all human interaction, including economic activities, should be conducted. The economist, in sharp contrast, begins by looking at the actual condition of the world, and makes the following observations:
All individuals and societies have wants.
Individuals and societies use resources (natural, physical capital, and human) to satisfy these wants.
Wants are unlimited and resources are limited.
Individuals and society must therefore choose what wants to satisfy and what resources to employ to satisfy them.
 Every society must answer three basic questions: 1) What will we produce? 2) How will we produce it? 3) For whom will it be produced? In all of human history, societies have found just three ways to answer these questions: Tradition, central planning and control, and the free market. This reviewer is very much a free-market economist, because he thinks the evidence is strong that the free market provides the best environment for satisfying wants under the constraint of scarcity. I will demonstrate what I believe and why I believe it with two examples:
 1) In 1991 The Catholic Archbishop of Panama asked if the market economy didn't "weigh most heavily on the poor." Argentine economist Juan Carlos de Pablos responded: "It is immoral to work outside the market system because this hurts the poor."
 2) In the old U.S.S.R. farm workers labored on huge
collective farms whose output was sold in price-controlled markets,
and the proceeds shared by all. When they had finished the
day's work on the collective farm, each worker was allowed an acre
or two on which to grow whatever they wished, and to sell it in a
free market for whatever they could get. These small plots
were three percent of all cultivated land, but they produced 30
percent of total output.
 I have not made any comments on whether people's wants are
"good" or "bad"; that is outside the domain of the economist as
"observer of behavior," not judge (those small farm plots in
the U.S.S.R. produced 70 percent of all Soviet potatoes-think
"vodka"). One basic postulate of modern, free-market
economics, is that the value of a good or service is "subjective,"
i.e., that it depends on the ability of the good or service to
satisfy wants, and wants (e.g., to watch Everybody Loves
Raymond, to read Playboy, to go to church on Sunday
and/or Wednesday, or just to be left alone) vary from individual to
individual. If, in a free market, you believe that too many
people want the "wrong" things, you are free to try to convince
them to align their beliefs and behavior with yours.
 I tell my economics students that there is no economics in
Heaven, because the Infinite Resource, God Himself, will satisfy
all of our wants. I believe economists, like everyone else,
can be challenged by thinkers like Tanner to examine our own
hierarchy or wants, but I also believe that the economist has
something to offer to the theologian. To once again quote de
Pablo, speaking this time to a Bishop from Peru: "We can tell
you how to make an economy work, you tell us how to make man act
morally within it." The American Catholic Bishops and other
Christian social-action advocates (including Tanner) have
frequently advocated government-imposed policies whose secondary
effects would be devastating to the economy. My goal, in the
marketplace of ideas, is to convince my students and Schumpeter's
intellectual elite that while good intentions are nice, and might
occasionally even be useful, they are a poor substitute for
understanding how a modern economy functions.
 About ten years ago I spoke to the Memphis Ministerial
Association, presenting the basic economic principles I have
discussed here. When I finished, a member of the Association
told me privately: "My heart disagrees with almost everything
you said, but my head tells me you're right." She could not
have given me a better compliment. I hope that Tanner, others
engaged in the great political and economic debates of the day, and
I, can attain and maintain a proper balance between heart and
© July 2006
Journal of Lutheran Ethics
Volume 6, Issue 7