« January 2009 »
S M T W T F S
1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31
You are not logged in. Log in
Entries by Topic
All topics  «
F unAQs
idiosyncratic egotism
legal matters
my books
Political and economic
Positive prayers and posi
Pure Satire
reviews
Where in the Bible
Blog Tools
Edit your Blog
Build a Blog
RSS Feed
View Profile
Are conservative Christian theology and liberal politics compatible?
Sunday, 11 January 2009
The Bank Bailout and the Parable of the Unforgiving Servant

A few months ago, Congress agreed with the President to give a collection of large financial institutions that were in severe debt trouble an obscenely large quantity of cash, with almost no strings attached, to get them out of their financial trouble.  Our leaders publicly expressed hope that, after they provided for the big institutions' debts and so saved them from destruction, the recipient institutions would start to make credit available again and would also cut some slack for the ordinary debtors that owed them money, thereby averting any larger crisis.

However, to date, none of the things our leaders publicly wished for have happened as a result of their generosity to wealthy corporate institutions.  The institutions given the money have used part of it to pay their debts to other large entities (but defintely not to unimportant "little" people), have used part of it to pay huge bonuses and golden parachutes to their top executives, and have sat on the rest.  The big institutions that received the infusions of public money have proceeded with their plans to lay off large numbers of their employees.   Credit has become tighter since the bailout, leading to business closures and layoffs throughout the economy.  The infusion of cash into the banks does not seem to have helped the economy at all, just those at the top of the financial entities that received the infusion. 

And, perhaps worst of all, the very same financial entities that were bailed out are now systematically putting the screws to all of the "little" (a/k/a real) people who owe them money. Banks have started to raise interest rates, late fees and other miscellaneous fees on existing balances wherever they can.  Average interest rates for existing credit card balances are already heading for 25%, and some experts believe they will reach 30% or above in the next year or so.  (This used to be called "usury" or "loan sharking," but it's now "business as usual").  They have made it clear that collection will be strictly enforced.

All I can say about this is that it could have been predicted.  The President and Congress were acting on a pipe dream.  Our large financial entities were acting the way most large debtors act when they are forgiven--by interpreting the forgiveness as favor to do whatever they want and consequently oppressing those who owe them money.  Even Jesus recognized this tendency.

In Matthew 18:21-35, Matthew recounts a story Jesus told about two debtors who were both subjects of the same king.   The first debtor owed the king a huge debt, much more than he could ever repay in a thousand lifetimes.  The second debtor owed the king nothing, but owed the first debtor about three months' wages.  Both debtors defaulted on their debts.  When the king called in the first debtor to pay his huge debt, the first debtor pleaded for mercy, and the king graciously forgave his astronomical debt.  After the king forgave his huge debt, the first debtor went out, found the second debtor, took him by the throat and threatened him with debtor's prison if he did not pay immediately.  The second debtor pleaded with the first debtor for mercy--or even for just a little more time to make payment--but the first debtor would not listen.  He had the second debtor put in prison until his full debt was paid.  The point of the parable was the king's response to the situation when he heard what the first debtor had done--"You evil servant!  I forgave you that tremendous debt because you pleaded with me.  Shouldn't you have mercy on your fellow servant, just as I had mercy on you?"  He then had the first servant cast into prison until he fulfilled his obligation to forgive the servant who owed him money.  The lesson is that we are to freely forgive others for their sins against us, not holding against them the debt of their sins, because God has forgiven us an immeasurably larger debt. We are to forgive others as God has forgiven us.

However, the important point for purposes of this discussion is that Jesus' story resonated with his listeners because they recognized that the first servant, the one who was forgiven the gigantic debt, behaved in exactly the same way most wealthy people forgiven a large debt would behave.  That is, he undestood the forgiveness as the king's permission to make a profit for himself however he could, even if this meant oppressing poorer people who owed him money. This is, and always has been, the way of the greedy when they are forgiven their debts.

Of course, there are some individual debtors who will choose to have mercy on their debtors when forgiven their own financial debts, just as there are some individual sinners who will follow Jesus' instructions to forgive their grudges against others when God forgives their own sins. 

But both of these statements only apply to individuals, not corporations.  Corporations, as artificial, soulless, non-human entities, are incapable of compassion and mercy.  They exist only to make the largest profits possible for their shareholders.  Yes, corporations are run by groups of real, human officers and directors.  But those officers and directors have a fiduciary duty to the artificial, soulless corporation that employs them to only make decisions that will maximize its profits.  If any officer or director of a financial corporation that recived the government's bailout largesse had actually attempted to do what the President and Congress publicly expressed hope the big banks would do--i.e., by making more credit available (to a "bad," risky market) and by having some mercy on the corporation's indiviadual human debtors--that corporate officer or director would either have been removed from office, subjected to a shareholder derivative suit to recover the losses of profits occasioned by his decision, or both. 

Thus humans who make the decisions for the financial corporations are not free to make the kinds of decisions Congress and the President hoped for.  They are free to do only exactly what they have done--pay their own debts, give themselves a cut of the action (to the extent permitted by their own employment contracts), put the screws to their debtors because of the increased risk in the market right now, and sit on the rest of the bailout money until the market improves.  Neither mercy nor risk-taking are on their agenda.  Our leaders would have known that if they had read the book of Matthew before proceeding with the bailout!    


Posted by ian_j_site2 at 10:38 AM EST
Updated: Sunday, 11 January 2009 11:36 PM EST

View Latest Entries