The point was made by secretary of state Cardinal Tarcisio Bertone who, at a Vatican meeting of European Bishops’ Conferences on the New Evangelisation yesterday said: “The [global] crisis illustrates clearly the untenability of a market that has become totally self-referential . . .

“This present difficult situation prompts a whole series of new questions about the responsibilities and the ethics of the marketplace; it urgently asks a fundamental question about the destiny, dignity and spiritual vocation of man . . . ”

http://www.irishtimes.com/newspaper/world/2011/1123/1224307999115.html

http://www.radiovaticana.org/EN1/Articolo.asp?c=531752

While the Vatican document focused on financial issues, it envisioned a much wider potential role for the global political authority. The agenda also includes peace and security, disarmament and arms control, protection of human rights, and management of migration flows and food security, it said.

Establishing such an authority will be a delicate project and will no doubt come at a cost of “anguish and suffering” as countries give up particular powers, the document said. The authority should be set up gradually, on the basis of wide consultation and international agreements, and never imposed by force or coercion, it said.

The authority should operate on the principle of subsidiarity, intervening “only when individual, social or financial actors are intrinsically deficient in capacity, or cannot manage by themselves to do what is required of them,” it said. Countries’ specific identities would be fully respected, it said.

The authority should transcend special interests, and its decisions “should not be the result of the more developed countries’ excessive power over the weaker countries” or the result of lobbying by nations or groups, it said.

“A long road still needs to be traveled before arriving at the creation of a public authority with universal jurisdiction. It would seem logical for the reform process to proceed with the United Nations as its reference,” it said.

http://www.catholicnews.com/data/stories/cns/1104173.htm

VATICAN CITY,Oct 24 (Reuters) – - The Vatican called on Monday for the establishment of a “global public authority” and a “central world bank” to rule over financial institutions that have become outdated and often ineffective in dealing fairly with crises.

http://uk.mobile.reuters.com/article/idUKL5E7LO1LS20111024?irpc=932

From the Vatican document:

“Of course, this transformation will be made at the cost of a gradual, balanced transfer of a part of each nation’s powers to a world authority and to regional authorities, but this is necessary at a time when the dynamism of human society and the economy and the progress of technology are transcending borders, which are in fact already very eroded in a globalizes world.”

This situation allows small groups of people to have a profound impact on public attitudes and policy discourse, provided that they are well-organized, well-funded, and stay on message.

– Stephen M. Walt

Read the full article

Here is a brief excerpt from this book:

Perhaps some are asking, “What does an economic collapse have to do with the Second Advent? Answer: The coming international economic meltdown, coupled with natural disasters, will drive governments to find scapegoats for the escalating calamities.

The religious card will be played. Something like this will be said, perhaps by the president of the United States: “We are in an enormous crisis. We need unity as never before. We need to restore our common values, our religious roots. We need fewer divisions, less hate talk. In fact, we are going to outlaw any group talking negatively about anyone else. This is a time to come together and fulfill the American dream. Remember, ’Righteousness exalted a nation.’ Let’s restore peace to our communities, at least for one day of the week. Let’s restore America to the way it used to be.”

Bingo! Sunday will be the day of choice, and the plea for tolerance and national unity will trump all negative talk about anyone’s sexual orientation, ethnic origin, or religious beliefs.

So what? someone may ask. These unprecedented conditions we have been reviewing in these pages will soon compel frightened citizens to enact strict government laws that will evaporate the basic freedoms on which this country was founded. For instance, no longer will it be permissible to argue for which day is the Sabbath or to point out who changed it-that will be considered intolerant, divisive, and subject to rapid, legal incarceration.

These unprecedented conditions we have been reviewing in these pages will soon compel frightened citizens to enact strict government laws that will evaporate the basic freedoms on which this country was founded.

…
Bottom line–such a time will come, when loyal, patriotic citizens will not be able to buy or sell. And if they continue to be divisive with their appeal to freedom, as guaranteed in the Constitution, Revelation 13 comes into play. Verse 15 predicts that the law will say they should be killed! We are not there yet, but the stage is surely being set. Really, it has never been this late before!

Does anyone still doubt the accuracy of the predictions in Revelation 13 and 18 that we have just reviewed, and Testimonies, volume 9, page 13? In this chapter, we have briefly flown over the current economic/political distress primarily in the United States. Only a fool is saying, “All is well!” But the U.S.A. comprises only part of the world’s predicaments.

In our next chapter we will focus on the quiet, though extraordinary methods being used to globalize all aspects of our lives, no matter what country we may live in. “All the world is a stage, and all the men and women merely players,” Shakespeare said so well in “As You Like It.” Never before in earth’s history has Planet Earth become such a world theater! Yes, we all are “bit” players! For the world to be bankrupt, “when great riches came to nothing”-that is still ahead.

—

Order your copy of Red Alert: Hurtling Into Eternity by Herbert E. Douglass from the Pacific Press Publishing Association at http://pppa.com/index.php?pgName=prodBooks&sku=0816324883

During his 60 year ministry, Dr. Herbert Douglass has served as a college theology professor, Atlantic Union College president, vice-president of a publishing house, president of Weimar Institute, vice-president for philanthropy at Adventist Heritage Ministry, and most recently, as consultant for Amazing Facts Ministry.  Author of many books and articles, Dr. Douglass earned his doctorate in 1964 at the Pacific School of Religion, Berkeley, California. 

 I’m not willing to pick cocoa beans or cotton for a dollar a day, so who is? Trafficked boys on the Ivory Coast and factory children in Asia whose fingers are small enough to work intricate and dangerous machines fill this gap.

Spending four dollars on a candy bar seems irrational. There are so many great tasting candy bars for 90 cents, why would I spend three more dollars for this Alter Eco specialty chocolate? In the end, they’re both equally bad for me and I won’t remember the difference tomorrow. Plus, I’ll be able to buy a cup of coffee at Starbucks with the leftover change. Being a business major, I began wondering if these “socially conscious” products like Alter Eco chocolate, Threads for Thought clothing, and other specialty made products were all cutting edge ways for people to make money with the front of caring about the sustainability for the world and people. It seemed to me that it was a great marketing scheme, and that these people in the companies focused on promoting a cheaper product for a greater cost to consumers because they put the emphasis on the individuals making them. The government already has regulations, like labor laws, in place so maybe all this hype about building “sustainable communities” is just a fad or another way for small companies to make it against these transnational corporate giants.

To make things clear, I really am all about supporting the local coffee shop or book store instead of always flocking to big corporations; but when Amazon has the same product for less, it has been my impression that I would be a careless buyer to go somewhere else. This is a question that has been introduced to us with globalization. Growing up in a consumerist society, I’ve repeatedly been taught to find the best product with the lowest cost, it’s Business 101. Gobbling up my 90 cent chocolate, I started worrying about how many insects the FDA allowed per candy bar, realizing that maybe that was the downside to cheaper chocolate. My business professors teach that the bottom line is what matters the most, but I have grown up in a family immersed in mission work and advocating global consciousness. I have started wondering what is most important in order to simultaneously be successful and yet not cross my personal ethics. Is there a way to be both? Is money the only way to success? Surely there was a way to balance both sides instead of veering off in just one direction.

With these thoughts mulling through my head and chocolate lingering in my mouth, I walked into the Freedom Summit conference hear about all the forms modern day slavery takes, and how globalization has created prime breeding grounds for the vulnerability of the masses. The speakers included Condoleezza Rice—former Secretary of State and National Security Advisor, Bradley Myles—CEO of Polaris Project, and David Batstone—a Professor of Ethics at USF and founder of Not for Sale Campaign. In the hardest days as Secretary of State under the Bush Administration, Condoleezza turned to the Founding Fathers biographies and came to the conclusion that with every large struggle, “what seemed impossible one day, seemed inevitable the next.” She introduced us to the idea that anti human trafficking is the social justice movement of our century and what is happening behind the backs of the general public is far worse than slavery in the past. There are more slaves today than in any other time in history, and we are all doing our part to help propel it forward.

Much of this shocked me—while not being completely ignorant to the struggles of people globally, I still had the rude awakening that every person is participating in this victimization process, where the marginalized people of society always become the victimized, from sex slavery to forced labor. As middle-class consumers, we want to support our families and ourselves while still having our 401ks and Baskin Robbins family night. The great disappointment to us is not having the fudge sauce on our two scoops because they ran out; but where does the chocolate Baskin Robbins buys come from? Consumerism doesn’t leave much room for humanity. It turns people into self-centered buying machines. Instead of being praised for finding the best deal, maybe we should be praised for being globally aware.

Nathan George, founder of Trade as One, switched from working at a lucrative software company to starting his fair trade company and discussed the business side of slavery. Common sense shows that resellers want the best price, and distributors want to make money, so somebody needs to make up for the gap at the bottom line. I’m not willing to pick cocoa beans or cotton for a dollar a day, so who is? Trafficked boys on the Ivory Coast and factory children in Asia whose fingers are small enough to work intricate and dangerous machines fill this gap. At the other end of the sheltered world, people want more chocolate and twenty t-shirts from Costco, therefore creating a demand for this work. All traffickers need to do is provide children to employers who solely care about money, and the cycle keeps going.

Most human traffickers tend to be ex drug traffickers who have realized that unlike cocaine, people are a resalable commodity. This creates a higher earning power for the trafficker and minimal risks because in developing countries, people cannot search after every child. With a high reward and low risks, it is a perfect business set up; that is, if you just look at numbers. The chocolate didn’t taste as sweet in my mouth as I heard about how I was eating slave-produced products and wearing a shirt made by 10 year old hands.

Realizing that my demand is directly correlated with the amount of their exploitation was not satisfying. Instead of being a savvy shopper by looking for the yellow smiley faces on weekly deals, maybe the valued knowledge actually comes in knowing the product’s supply chain. The advertising for a product tasting the best or being the cheapest shouldn’t trump what is happening on the underside of their business. I don’t see a change coming in my chocolate addiction, but the 30 minutes more of work to buy the slave-free chocolate won’t strain my body as much as theirs. This conference probed me to think about the validity of these brands that I was a skeptic of. One of the careful statements that Nathan George, founder of Trade as One, made during the conference was that we as consumers may be overwhelmed at the prices of actually buying socially responsible items, but the first step is to reduce what we consume in order to balance it out. Do I really need to have a candy bar and Starbucks? Aren’t both of those luxury items anyways? By living responsibly, I’m giving others a higher chance of simply living.

This is easier stated than done. With opportunities for “deals” surrounding us daily, it’s hard to not fall into a pattern that we, as free people, are used to. One of the biggest reminders and strongest points I repeat daily is that I have done nothing to secure the position I have in life of being in a free country, just like these modern day slaves have done nothing to have their entire lives indebted to us because of the harsh demands we put on them with our high consumerist behavior. These socially conscious products contain more than just a new age aura or a better selling point; they represent a desire for the priority of humanity instead of selfish search for profit. The balance that fits in my life is one that requires awareness of what I consume, learning to live on less, and realizing that I can be socially active this the model and with my voting power. What changes can you make in your life to leave room for others?

Kate Case, a Global Studies major at La Sierra University, is a campaign strategy intern for California Against Slavery, a non-profit, non-partisan human rights organization working to get an anti-human trafficking initiative on the 2012 ballot for California. Case is the founder of the blog, The Priority of Humanity (http://www.priorityofhumanity.com), which is a compilation of books, documentaries, and other resources related to human trafficking. The blog also has information on current and pending legislation on the issue. This fall, she will be interning with Seventh-day Adventist Public Affairs and Religious Liberty Department in Washington, DC where her duties  will include research and advocacy.

The delivery of mail on Sundays in the United States has a fascinating history, and most people do not know that until 1912, the Postal Service routinely delivered mail on Sundays. It was only under pressure from religious and labor organizations that the USPS gradually transitioned to the now-familiar Monday through Saturday schedule.

The Postal Service is as old as the nation itself, beginning with the kite-flying, bifocal inventing, and noted Renaissance man Benjamin Franklin who organized the USPS at the direction of the Second Continental Congress on July 26, 1775. The founders then gave Congress the power to establish and maintain the postal service as one of the enumerated powers in Article One of the Constitution. The mail was the sole communication lifeline of the newly formed nation, and the Postmaster a cabinet position and the final position in the presidential line of succession until the USPS was reorganized in 1971.

Between its inception in 1775 and 1912, postal employees delivered mail seven (7) days a week. In the early 1800s, religious leaders became concerned that employees were forced to work on the “Christian Sabbath,” or Sunday, and began to petition Congress to use its Article I powers to disallow Sunday delivery. This concern reached a fevered pitch in 1810 when Congress required post offices to open at least one hour on Sunday.^[1] Outraged that Congress had thus “enforced Sunday desecration,” religious leaders began to clamor for legislation that would outlaw Sunday operations.

This stemmed, in part, from the fact that prior to the passage of the equal protection clause of the Fourteenth Amendment which was one of the post-Civil War Amendments which applied the establishment clause of the First Amendment to the states, state and local governments were able to regulate Sunday closings of businesses and even regulate what private activities a person could participate in on Sundays. The post office, however, was Federal territory and people could go there and conduct business, or socialize and the local religious leaders had no jurisdiction to interfere.

In response to the petitions, in January 1811, Postmaster Gideon Granger issued a report to Congress describing his approach to the law requiring at least one hour of postal operations and expressing his concern that it might compel his employees to violate Sunday sacredness.  Writing in the third person, he stated, “to guard against any annoyance to the good citizens of the United States, he carefully instructed and directed the agents of this office to pass quietly, without announcing their arrival or departure by the sounding of horns or trumpets, or any other act calculated to call off the attention of the citizens from their devotions . . . .” After describing additional methods whereby he intended to mitigate Sunday desecration, the Postmaster concluded on a religious note, “that compelling the Postmasters to attend to the duties of the office on the Sabbath, is, on them, a hardship, as well as in itself tending to bring into disuse and disrepute the institutions of that holy day.”^[2]

“[C]ompelling the Postmasters to attend to the duties of the office on the Sabbath, is, on them, a hardship, as well as in itself tending to bring into disuse and disrepute the institutions of that holy day.” Postmaster Gideon Granger

In 1815, the United States House in Committee of the Whole held hearings on the petition of citizens from five states to prohibit Sunday transportation and opening of mail. After reviewing the petitions, the committee responded that communication was necessary, particularly since the nation was at war, and resolved that, “at this time it is inexpedient to interfere and pass any laws” prohibiting mail transportation and opening on Sundays.^[3]

The debate continued and in 1830, 75-year-old John Leland, a prominent Baptist minister who had championed liberty of conscience at the founding of the nation, addressed the issue. After describing America’s religious diversity, ranging from Islam to Judaism, paganism to Christianity, he stated that he believed that in deciding to close on Sunday, Congress would be making a theological decision in deciding which day was holy. After all, he reasoned, Congress should also recognize that Saturday was holy to Jews and “Sevendarian Christians.” Leland concluded:

“The powers given to Congress are specific-guarded by a ‘hitherto shalt thou come and no further.’ Among all the enumerated powers given to Congress, is there one that authorizes them to declare which day of the week, month, or year, is more holy than the rest-too holy to travel upon? If there is none, Congress must overleap their bounds, by an unpardonable construction, to establish the prohibition prayed for. Let the petitioners ask themselves the question. If Congress should assume an ecclesiasticopolitical power, and stop the mail on the seventh day, and let it be transported on the first, would that satisfy them? If not, are they doing as they would be done by?”^[4]

A group of citizens from Salem, New Jersey, including some Saturday-Sabbath keepers also wrote to Congress in 1830, concerned that the proposed Sunday closing would favor some religions over others, and called for the continued separation of church and state. “We cannot be too thankful,” they wrote, “that the Constitution of the United States guarantees to every one the rights of conscience and religion; . . . the proposed [Sunday closing] measure would operate as a violation of these rights . . . would pave the way to a union of church and state, against which our horrors are excited by the awful admonitions of history; which would be the death blow to our civil and religious liberties . . . and end in the worst of all tyranny ‘an ecclesiastical hierarchy.’”^[5]

Near the turn of the century, religious leaders once again sensed the need for greater observance of Sunday sacredness, and pushed for legislation that would prohibit various types of work on Sunday. On August 24, 1912, President William Taft signed H.R. 21279 (Mann) into law, closing all post offices on Sundays an introducing a six-day work week for postal clerks and letter carriers. The bill provided “that hereafter post offices . . . shall not be opened on Sundays for the purpose of delivering mail to the public.”^[6]

The bill was put into effect on September 1 of that year, and although it was hailed as a victory for workers’ rights by the American Federation of Labor, Sunday sacredness advocates viewed it as a spiritual victory. Among the many religious groups who claimed victory, the Federal Council of the Churches of Christ in America, in its quadrennial report noted that “it is gratifying to know that through the co-operation of the associations of letter and postal clerks, under the leadership of the Lord’s Day Alliance of the United States, a bill passed the last Congress, which closed to the public all the first and second class post-offices in the United States on Sunday.”^[7]

However, the Postmaster cited scheduling difficulties, particularly the requirement that those employees fulfilling necessary work on Sunday be granted compensatory time in the next six days, and said that the new law “has greatly increased the difficulties of efficient post-office service.”^[8] This would seem to indicate that religion, not efficiency, was the primary reason for closing on Sundays.

Today, all United States Post Offices are closed for Sunday delivery except for two: Angwin, California and Collegedale, Tennessee where a significant percentage of people observe the Sabbath on Saturday and where private post offices, owned by the Seventh-day Adventist Church which operate universities in these towns, have contracts that guarantee no Saturday deliveries.

[1] “11th Congress, 2nd Sesssion, An Act Regulating the Post-Office Establishment, Enacted April 30, 1810.” American State Papers Bearing on Sunday Legislation, Revised and Enlarged Edition, compiled and annotated by William Addison Blakeley, Revised Edition edited by Willard Allen Colcord, The Religious Liberty Association, Washington, D.C. 1911, 176.

[2] Harmon Kingsbury, The Sabbath: A Brief History of Laws, Petitions, Remonstrances and Reports with Facts and Arguments Relating to the Christian Sabbath, S.W. Benedict, Printer, New York, 1840, 26.

[3] Blakeley, 393.

[4] The Writings of John Leland, Edited by L.F. Greene, Arno Press & The New York Times, New York,  1969, 564-66.

[5] Blakeley, 298.

[6] American State Papers and Related State Papers on Freedom in Religion, compiled and annotated by William Adison Blakeley, Published for the Religious Liberty Association by the Review and Herald, Washington, D.C., 1949, 273.

[7] Christian Unity at Work,  The Federal Council of the Churches of Christ in America in Quadrennial Session at Chicago, Illinois, 1912, Published by the Federal Council of the Churches of Christ, edited by Charles S. Macfarland, 1913, 242.

[8] Post Office Department Annual Reports for the Fiscal Year Ended June 30, 1914: Report of the Postmaster General, Government Printing Office, Washington, D.C., 1914, 143

photo credit: Ksayer1

###

Michael Peabody is the editor of ReligiousLiberty.TV.

The architects of our nation took great care to constitute a limited government founded on personal responsibility and individual liberty. Do our internal revenue laws promote or undermine these founding principles? Are they an appropriate vehicle for implementing sweeping social policy? These and other questions will be the focus of our conference.

Panel II: Charity: Whether and, if so, How Our Tax Laws Affect Charitable Activities, Religious Institutions, and Free Speech
–Mr. Lee E. Goodman, Esq., LeClairRyan
–Mr. Kevin Hasson, The Becket Fund for Religious Liberty
–Ms. Anne D. Neal, American Council of Trustees and Alumni
–Moderator: Mr. Matthew Vadum, Capital Research Center

One of the items on the hit list of the new majority in the House of Representatives to “balance the budget” is the Community Action Program (CAP) or what is currently labeled Community Service Block Grants. This is a program begun in the 1960s in the Lyndon Johnson administration. It is a nearly unique program in that it empowers local, grass-roots organizations made up of partnerships of citizens and local elected officials. It is perplexing that the same party that wants to encourage solutions outside of government bureaucracy also wants to do away with one of the few examples of this kind of strategy actually being implemented.

I have personal knowledge of CAP because I worked in it for 18 months in 1971-72 while in graduate school. It was launched with the idea that it would help local citizen groups reduce or end poverty in their communities and it never really provided much that is in the self-interest of politicians or political parties. Over the years it has been weakened by every administration and both parties. Yet there are hundreds of local Community Action Agencies (CAA) that continue to work as best they can.

There are those that argue that CAP is a government program, despite the fact that each of the CAA are locally controlled and almost all of them are incorporated as nonprofits with 501c3 tax-exempt charity status. The law originally required that the majority of the board members be people living below the poverty line and some CAA still follow that guideline. The Federal funding is simply a catalyst, not the major source of the budgets for most CAA.

The savings to the Federal budget from cutting these funds is miniscule. It cannot make any difference in the deficit or repaying the debt. This is actually a good example of how budget cuts are often just a cover story for getting rid of things for other reasons. In fact, both parties have already agreed to not cut the items that are necessary if anything significant is going to be done about budget deficits or the national debt.

There are three kinds of opponents to the Community Action Program:

(1) Those who do not believe in doing anything about poverty. These are often people who believe that the economy will take care of itself and if no one helps the poor they will get jobs and take care of themselves. In my opinion, this view can only be sustained out of ignorance, even if it is willful ignorance. Any significant experience with entrenched poverty reveals that intervention is necessary to overcome it.

(2) Those who think private nonprofit organizations can fight poverty more cheaply than government. This category includes people who really do not care about the poor, but feel that civilization demands that something be done about poverty and want the cheapest possible solution. They choose to ignore the fact that the cheapest solution is not always the best solution.

(3) Those who think private nonprofit organizations can fight poverty more effectively than government. It is tragic that there are people who want to defund CAP on the basis of this logic. This is the very purpose for CAP. The inventors of CAP believed this precisely and designed the CAA on this basis. The Federal funding is simply a catalyst and the CAA are weak enough (especially at this moment in our economic history) that without the catalyst the whole structure could collapse in many communities where it is most needed.

In 1927 the great Mississippi flood demonstrated to Americans that the country had become too large and complex to continue a policy of non-involvement by the Federal government in issues related to disaster response, unemployment and poverty. It is unfortunate that most Americans have such a limited knowledge of history that we seem fated to relearn important lessons every 80 years or so.

—————

Monte Sahlin is chairman of the board for the Center for Creative Ministry, a research organization and resource center helping pastors, congregations and other organizations understand new generations and how to engage with them. He is also chairman of the board for the Center for Metropolitan Ministry, a “think tank” and training organization based on the campus of Washington Adventist University in Washington, DC, as well as an adjunct faculty member at the Campolo Graduate School at Eastern University in Philadelphia and in the DMin program at Andrews University. In addition, he serves on the steering committee of the Cooperative Congregational Studies Partnership, a coalition of researchers from more than 40 denominations and faiths who produce the Faith Community Today (FACT) research.

Sahlin is an ordained pastor in the Seventh-day Adventist Church, currently serving in the Ohio Conference of the denomination.  He is the author of 20 books, 56 research monographs and hundreds of magazine articles. His most recent book is entitled “Mission in Metropolis.” Others currently available are “Ministries of Compassion,” “One Minute Witness,” “Understanding Your Community,” “Trends, Attitudes and Opinions” and “Adventist Congregations Today.” In 2005, he coauthored with Harold Lee, “Brad: Visionary, Spiritual Leadership,” a history and evaluation of the career of Charles Bradford, the first African American to serve as president of the Seventh-day Adventist Church in North America.

This article was originally posted on his blog at MonteSahlin.com.

EXCERPT:

It was a year and one-half ago we told you that $800 billion in stimulus wasn’t enough. That is now proving to be the case. Get ready for another liquidity barrage, called quantitative easing. It will also mean real interest rates will rise again. The backbone of most all nations of the world is debt not gold, silver or a basket of commodities. Greece is being blamed, but all told, 19 nations are on the edge of bankruptcy. In fact, central banks in these countries are among the biggest speculators. In the euro zone countries cannot print money so they sell bonds in spite of the rules of the bailout. Many are having a hard time selling bonds. Thus other nations are secretly doing so.

There is talk of another Northern European currency backed by gold. If that happens the dollar will fall because it won’t be able to compete. Those in the southern tier will have to return to their own currencies and do as Argentina did ten years ago. Those long dollars do not get too comfortable.

In high school, the only sports I played to any significant extent were soccer and basketball. A lot of my friends went snowboarding or skiing, but it was a long drive to the mountains and I could not really afford all the equipment, which cost hundreds of dollars. So I never spent much time on the slopes. However, I have always been fascinated by winter sports. The Winter Olympics in Vancouver was the first of two major international sporting events this year, the other being the soccer World Cup, to be held in South Africa in June. Both events feature the best athletes in the world in their respective sports and enthrall millions across the globe.

However, after watching the Germans steer their bobsleds, the Russians twist and turn in figure skating, and the French ski down steep mountain slopes, I began to realize that the true reason that many athletes from cold-weather countries succeed in this frosty quadrennial competition is not climate or topography or even, dare I say it, talent, but rather privilege, economics, and wealth. Of all the stunning statistics that were tossed around during the fortnight of games in British Columbia, one stat was not mentioned, although its omission is hardly surprising. Of the 238 total medals that were up for grab in Vancouver, over 50 percent were won by eight of the world’s wealthiest nations. The United States, Canada, Great Britain, Japan, Russia, France, Germany, and Italy—industrialized market economies, who together make up the world’s main economic council of wealthy nations, the exclusive Group of Eight, or G8—took home 130 medals and nearly half of the first-place finishes. In addition to the success of the G8 nations, China, widely considered the second wealthiest nation in the world after the U.S., and South Korea, another powerhouse economy in Asia, took home just under 10 percent of remaining medals. It is also worth mentioning that Norway, which the International Monetary Fund places three positions higher than the United States in GDP at purchasing power parity per capita, and Switzerland, which also ranks in the top ten and is just one place behind the U.S., brought home approximately 9 percent and 3 percent of the Winter Olympics medals respectively. If you are doing the math, that means that 72 percent, nearly three-fourths, of all the medals in Vancouver were won by twelve incredibly wealthy nations. While similar patterns were displayed in Beijing and other summer Olympic games, one must remember that the Beijing 2008 Summer Olympics were a competition where poorer nations like Ethiopia, Romania, Jamaica, Kenya, and Ukraine walked away with a half-dozen gold medals each. With the exception of Austria, hardly a nation of impoverished citizens, and Yugoslavia, the Winter Olympics has never been held outside of these twelve countries since the competition began nearly ninety years ago.

The lack of success among underdeveloped nations in the Winter Olympics is not for want of trying. Take, for instance, the story of Tugba Karademir, the young figure skater from Turkey, where the capital city Ankara has the country’s only real ice rink. Karademir’s father and mother, who is a certified aerospace engineer, immigrated to Canada and accepted jobs doing menial labor just so their daughter could have a chance to compete in the Olympic Games. While geography could be considered a significant challenge to athletes wanting to ski in the Pacific islands or snowboard in the heart of Africa, a large number of events occur indoors or on manmade ramps and tracks, and more often than not, poorer countries do not compete because they lack the finances to compete in sports that require such a large amount of equipment. Is it surprising that most kids in Brazil have never played ice hockey but are always seen with a soccer ball at their feet? Or that children in Cuba play baseball with a simple wooden bat instead of curling? Or that the best skiers in your dorm usually come from the most privileged families? Understand that I am not insinuating that there is a vast conspiracy in winter sports against poorer nations, but that among all of the athletic competitions in the world, it is the most inherently unequal. While I enjoyed watching ice hockey and the rest of the winter games, as a liberal and a lover of equality, they pale in comparison to the World Cup, where 32 nations from across the globe compete on a much more equal playing field in a truly international competition, where success is determined not by how much equipment you or your country can afford, but by your skill kicking a ball on a field of grass.

Martin Surridge is the associate editor of Religious Liberty TV and a freelance journalist who writes for the Walla Walla Union-Bulletin. He is currently working on his M.A. in Teaching at Walla Walla University.

China has recently been calling for an international one-child policy as an answer to global warming, with perhaps the most chilling observation from http://www.chinadaily.com.cn/china/2009-12/10/content_9151129.htm, being a statement from Zhao Baige, vice-minister of National Population and Family Planning Commission of China (NPFPC), “Although China’s family planning policy has received criticism over the past three decades, Zhao said that China’s population program has made a great historic contribution to the well-being of society. . . . . She admitted that China’s population program is not without consequences, as the country is entering the aging society fast and facing the problem of gender imbalance.”

The issue of “gender imbalance” in China has occurred as female babies are disproportionately aborted in response to the policy. We will be watching these developments closely.  RLTV Editor

 Editor

EXCERPT:

The fix is simple. It’s dramatic. And yet the world’s leaders don’t even have this on their agenda in Copenhagen. Instead there will be photo ops, posturing, optics, blah-blah-blah about climate science and climate fraud, announcements of giant wind farms, then cap-and-trade subsidies.

None will work unless a China one-child policy is imposed. Unfortunately, there are powerful opponents. Leaders of the world’s big fundamentalist religions preach in favor of procreation and fiercely oppose birth control. And most political leaders in emerging economies perpetuate a disastrous Catch-22: Many children (i. e. sons) stave off hardship in the absence of a social safety net or economic development, which, in turn, prevents protections or development.

China has proven that birth restriction is smart policy. Its middle class grows, all its citizens have housing, health care, education and food, and the one out of five human beings who live there are not overpopulating the planet.

For those who balk at the notion that governments should control family sizes, just wait until the growing human population turns twice as much pastureland into desert as is now the case, or when the Amazon is gone, the elephants disappear for good and wars erupt over water, scarce resources and spatial needs.

Read the full article at: http://www.financialpost.com/story.html?id=2314438

The Declaration, drafted by Chuck Colson, Dr. Robert George, and Dr. Timothy George, is in direct response to the recent gay marriage debate and is designed to provide a common base of support for activities such as the Catholic Church’s recent high pressure lobbying of Congress to eliminate language from the national health care bill that would have funded abortion.

 While they have claimed they will commit “civil disobedience,” essentially this amounts to refusing to perform activities inconsistent with their faith while enjoying non-profit 501(c)(3) status, and signals a willingness to withdraw from providing humanitarian public services if the government makes such activities a prerequisite for non-profit status or funding. In other words, a Catholic adoption agency may shutter its doors rather than provide services for same-sex couples.

Although the groups have not been able to agree on fundamental theological issues, their unity around these points held in common may initially seem to be an admirable step forward in reasserting the Christian voice in America’s culture wars.  

So far so good – churches shouldn’t be compelled by the government to do things that violate their sincerely held beliefs.  However, the Declaration does not stop with three issues that many American Christians would easily agree upon as protective of their faith. In the midst of the statement on promoting a “thriving marriage culture,” the writers tuck in an ominous sentence that seemingly comes out of nowhere, “But if we are to begin the critically important process of reforming our laws and mores to rebuild such a culture, the last thing we can afford to do is to re-define marriage in such a way as to embody in our laws a false proclamation about what marriage is.” (Emphasis added.)

 The writers do not clearly define what they mean by a “thriving marriage culture.” Since same-sex marriage is merely a hindrance to achieving this goal, there must be something beyond defining what constitutes marriage. Culture is a broad sweeping concept, and passing laws would affect not just adherents but everybody in society.

And what does it mean to “rebuild” such a marriage culture? Despite the imperfections of modern family life, what laws could be passed to restore a “thriving marriage culture”? There are two things that families could use more of: money and time. Tax breaks might help families by relieving a portion economic stress but such changes might only increase family budgets by at most 10% and would require cuts in government services benefiting low income families. Time is a much more valuable commodity and if the supply and demand chain were broken one day a week, families would have opportunity to relax because there would be no reason for the majority of people to go to work that day.

Declaration signers know that it is impossible to pass a law requiring people to “be nice.” However, things can be done to help families. If they are to reinvigorate a thriving marriage culture, sweeping changes must be made across the board to empower families. Right now, with 24/7 commerce it is difficult to give employees a uniform day of rest that they can count on each week so that they can plan family time.  (See http://www.keepsundayspecial.org.uk/research/index.php?id=38 for the secular health and safety benefits of a uniform day of rest.)   Promoting the family time inherent in Sabbath rest would appear to promote a thriving marriage culture, and would at least require economic penalties against those businesses who required their employers to lose this family time by engaging in commerce.

Such efforts are underway in Europe where Germany has passed a national day of rest for most sectors of the economy. (See http://www.spiegel.de/international/0,1518,462439,00.html to read where the law is being used as a mechanism to block a minority group from practicing its faith.)

In America we are quickly reaching the critical point where expansion of freedom is viewed by some as a threat to religious liberty. Advocates for religious freedom who once took an almost permissive approach so long as the rights and safety of innocent third parties were protected are now actively calling for those types of freedoms to be curtailed.

It is a delicate balancing act, and churches do well to protect their integrity. But if they are also using the power of this unity to “reform laws” and “rebuild the culture” then we are witnessing the emergence of a new threat to liberty. After all, if the problems we face are resulting from too much freedom, a restoration of a prior culture would mean a rollback in freedom.

From a strictly human perspective, the document is troubling as well. It focuses on human power to effect changes in human laws which will in turn effect the hearts of the people – an approach that Christ repeatedly rejected in His earthly ministry. If Christians want to rebuild a moral culture, they must be willing to preach the gospel but rely on the power of God to change hearts – they should not hide behind the power of government.

We are dancing on shifting sands. It may be tempting and even seem safer to join the crowd and push for new laws to change society. It can be frightening to run the risk of appearing in favor of “immorality” if you stand for the principles of separation of church and state, and try to protect the rights of both the religious and the secular.  It is true that there are tremendous forces coming at churches from the left but the answer is not for the people of faith to become the threats themselves. Those on left and right should seek to protect themselves and their organizations from those on the opposite side, yet not force their will on the rest of society.  

I am afraid we are seeing the emergence of a snowball effect – the forces now assembling will do whatever it takes, and say whatever they need to in order to gain power, adherents, and confidence and will eventually threaten the well-being of all who refuse to conform.

We have no reason to doubt that those who drafted and are signing the Declaration are sincere and trying to do what they believe is best for America.  There are many good reasons why it may seem a good idea, but we should raise a voice of caution regarding the unintended consequences of this approach.  Christians tempted to set aside theological differences, which include differences in how grace and salvation are viewed so significant that they led to the battles of the Reformation and Inquisition, and unite on points held in common in order to change society should recall the unholy results of such unions. From a Christian perspective, government and even church edicts cannot change hearts, only God can.

As we are admonished in 2 Timothy 3:5, “They will act religious, but they will reject the power that could make them godly. Stay away from people like that!” (New Living Translation)

1. One
4. Nobody spends somebody else’s money as carefully as he spends his own. Ever wonder about those stories of $600 hammers and $800 toilet seats that the government sometimes buys? You could walk the length and breadth of this land and not find a soul who would say he’d gladly spend his own money that way. And yet this waste often occurs in government and occasionally in other walks of life, too. Why? Because invariably, the spender is spending somebody else’s money. Economist Milton Friedman elaborated on this some time ago when he pointed out that there are only four ways to spend money. When you spend your own money on yourself, you make occasional mistakes, but they’re few and far between. The connection between the one who is earning the money, the one who is spending it and the one who is reaping the final benefit is pretty strong, direct and immediate. When you use your money to buy someone else a gift, you have some incentive to get your money’s worth, but you might not end up getting something the intended recipient really needs or values. When you use somebody else’s money to buy something for yourself, such as lunch on an expense account, you have some incentive to get the right thing but little reason to economize. Finally, when you spend other people’s money to buy something for someone else, the connection between the earner, the spender and the recipient is the most remote — and the potential for mischief and waste is the greatest. Think about it — somebody spending somebody else’s money on yet somebody else. That’s what government does all the time. But this principle is not just a commentary about government. I recall a time, back in the 1990s, when the Mackinac Center took a close look at the Michigan Education Association’s self-serving statement that it would oppose any competitive contracting of any school support service (like busing, food or custodial) by any school district anytime, anywhere. We discovered that at the MEA’s own posh, sprawling East Lansing headquarters, the union did not have its own full-time, unionized workforce of janitors and food service workers. It was contracting out all of its cafeteria, custodial, security and mailing duties to private companies, and three out of four of them were nonunion! So the MEA — the state’s largest union of cooks, janitors, bus drivers and teachers — was doing one thing with its own money and calling for something very different with regard to the public’s tax money. Nobody — repeat, nobody — spends someone else’s money as carefully as he spends his own. Six
6. Government has nothing to give anybody except what it first takes from somebody, and a government that’s big enough to give you everything you want is big enough to take away everything you’ve got. This is not some radical, ideological, anti-government statement. It’s simply the way things are. It speaks volumes about the very nature of government. And it’s perfectly in keeping with the philosophy and advice of America’s Founders. It’s been said that government, like fire, is either a dangerous servant or a fearful master. Think about that for a moment. Even if government is no bigger than our Founders wanted it to be, and even if it does its work so well that it indeed is a servant to the people, it’s still a dangerous one! As Groucho Marx once said of his brother Harpo, “He’s honest, but you’ve got to watch him.” You’ve got to keep your eye on even the best and smallest of governments because, as Jefferson warned, the natural tendency is for government to grow and liberty to retreat. You can’t wind it up and walk away from it; it takes eternal vigilance to keep it in its place and keep our liberties secure. The so-called “welfare state” is really not much more than robbing Peter to pay Paul, after laundering and squandering much of Peter’s wealth through an indifferent, costly bureaucracy. The welfare state is like feeding the sparrows through the horses, if you know what I mean. Put yet another way, it’s like all of us standing in a big circle, with each of us having one hand in the next guy’s pocket. Somebody once said that the welfare state is so named because in it, the politicians get well and the rest of us pay the fare. A free and independent people do not look to government for their sustenance. They see government not as a fountain of “free” goodies, but rather as a protector of their liberties, confined to certain minimal functions that revolve around keeping the peace, maximizing everyone’s opportunities and otherwise leaving us alone. There is a deadly trade-off to reliance upon government, as civilizations at least as far back as ancient Rome have painfully learned. When your congressman comes home and says, “Look what I brought for you!” you should demand that he tell you who’s paying for it. If he’s honest, he’ll tell you that the only reason he was able to get you something was that he had to vote for the goodies that other congressmen wanted to take home — and you’re paying for all that, too. Seven
8. Liberty makes all the difference in the world. Just in case the first six principles didn’t make the point clearly enough, I’ve added this as my seventh and final one. Liberty isn’t just a luxury or a nice idea. It’s much more than a happy circumstance or a defensible everyday concept. It’s what makes just about everything else happen. Without it, life is a bore at best. At worst, there is no life at all. Public policy that dismisses liberty or doesn’t preserve or strengthen it should be immediately suspect in the minds of a vigilant people. They should be asking, “What are we getting in return if we’re being asked to give up some of our freedom?” Hopefully, it’s not just some short-term handout or other “mess of pottage.” Ben Franklin went so far as to advise us, “Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety.” Too often today, policymakers give no thought whatsoever to the general state of liberty when they craft new policies. If it feels good or sounds good or gets them elected, they just do it. Anyone along the way who might raise liberty-based objections is ridiculed or ignored. Today, government at all levels consumes more than 42 percent of all that we produce, compared with perhaps 6 percent or 7 percent in 1900. Yet few people seem interested in asking the advocates of still more government such cogent questions as, “Why isn’t 42 percent enough?”; “How much more do you want?”; or, “To what degree do you think a person is entitled to the fruits of his labor?” ~~~~~~~~~~~~~~~~ I yearn for the day when all Americans practice these seven principles. I think they are profoundly important. Our past devotion to them, in one form or another, explains how and why we fed, clothed and housed more people at higher levels than any other nation in the history of the planet. And these principles are key to preserving that crucial element of life we call liberty. Thanks for the opportunity to share them with you today and thanks for whatever you may do from this day forward to put these principles into common practice. whatever you may do from this day forward to put these principles into common practice.   Free people are not equal, and equal people are not free. First, I should clarify the kind of “equalness” to which I refer in this statement. I am not referring to equality before the law — the notion that you should be judged innocent or guilty of an offense based upon whether or not you did it, with your race, sex, wealth, creed, gender or religion having nothing to do with the outcome. That’s an important foundation of Western civilization, and though we often fall short of it, I doubt that anyone here would quarrel with the concept. No, the “equalness” to which I refer is all about income and material wealth — what we earn and acquire in the marketplace of commerce, work and exchange. I’m speaking of economic equality. Let’s take this first principle and break it into its two halves. Free people are not equal. When people are free to be themselves, to be masters of their own destinies, to apply themselves in an effort to improve their well-being and that of their families, the result in the marketplace will not be an equality of outcomes. People will earn vastly different levels of income; they will accumulate vastly different levels of wealth. While some lament that fact and speak dolefully of “the gap between rich and poor,” I think people being themselves in a free society is a wonderful thing. Each of us is a unique being, different in endless ways from any other single being living or dead. Why on earth should we expect our interactions in the marketplace to produce identical results? We are different in terms of our talents. Some have more than others, or more valuable talents. Some don’t discover their highest talents until late in life, or not at all. Magic Johnson is a talented basketball player. Should it surprise anyone that he makes infinitely more money at basketball than I ever could? Will Kellogg didn’t discover his incredible entrepreneurial and marketing talent until age 46; before he struck out on his own to start the Kellogg Company, he was making about $25 a week doing menial jobs for his older brother in a Battle Creek sanitarium. We are different in terms of our industriousness, our willingness to work. Some work harder, longer and smarter than others. That makes for vast differences in how others value what we do and in how much they’re willing to pay for it. We are different also in terms of our savings. I would argue that if the president could somehow snap his fingers and equalize us all in terms of income and wealth tonight, we would be unequal again by this time tomorrow because some of us would save our money and some of us would spend it. These are three reasons, but by no means the only three reasons, why free people are simply not going to be equal economically. Equal people are not free, the second half of my first principle, really gets down to brass tacks. Show me a people anywhere on the planet who are indeed equal economically, and I’ll show you a very unfree people. Why? The only way in which you could have even the remotest chance of equalizing income and wealth across society is to put a gun to everyone’s head. You would literally have to employ force to make people equal. You would have to give orders, backed up by the guillotine, the hangman’s noose, the bullet or the electric chair. Orders that would go like this: Don’t excel. Don’t work harder or smarter than the next guy. Don’t save more wisely than anyone else. Don’t be there first with a new product. Don’t provide a good or service that people might want more than anything your competitor is offering. Believe me, you wouldn’t want a society where these were the orders. Cambodia under the communist Khmer Rouge in the late 1970s came close to it, and the result was that upwards of 2 million out of 8 million people died in less than four years. Except for the elite at the top who wielded power, the people of that sad land who survived that period lived at something not much above the Stone Age. What’s the message of this first principle? Don’t get hung up on differences in income when they result from people being themselves. If they result from artificial political barriers, then get rid of those barriers. But don’t try to take unequal people and compress them into some homogenous heap. You’ll never get there, and you’ll wreak a lot of havoc trying. Confiscatory tax rates, for example, don’t make people any more equal; they just drive the industrious and the entrepreneurial to other places or into other endeavors while impoverishing the many who would otherwise benefit from their resourcefulness. Abraham Lincoln is reputed to have said, “You cannot pull a man up by dragging another man down.” Two
9. What belongs to you, you tend to take care of; what belongs to no one or everyone tends to fall into disrepair.
10. Three
11. Sound policy requires that we consider long-run effects and all people, not simply short-run effects and a few people.
12. Four
13. If you encourage something, you get more of it; if you discourage something, you get less of it. You and I as human beings are creatures of incentives and disincentives. We respond to incentives and disincentives. Our behavior is affected by them, sometimes very powerfully. Policymakers who forget this will do dumb things like jack up taxes on some activity and expect that people will do just as much of it as before, as if taxpayers are sheep lining up to be sheared. Remember when George Bush (the first one) reneged under pressure on his 1988 “No New Taxes!” pledge? We got big tax hikes in the summer of 1990. Among other things, Congress dramatically boosted taxes on boats, aircraft and jewelry in that package. Lawmakers thought that since rich people buy such things, we should “let ‘em have it” with higher taxes. They expected $31 million in new revenue in the first year from the new taxes on those three things. We now know that the higher levies brought in just $16 million. We shelled out $24 million in additional unemployment benefits because of the people thrown out of work in those industries by the higher taxes. Only in Washington, D.C., where too often lawmakers forget the importance of incentives, can you aim for 31, get only 16, spend 24 to get it and think that somehow you’ve done some good. Want to break up families? Offer a bigger welfare check if the father splits. Want to reduce savings and investment? Double-tax ‘em, and pile on a nice, high capital gains tax on top of it. Want to get less work? Impose such high tax penalties on it that people decide it’s not worth the effort. Right now in both state and federal legislatures, much attention is being given to the question of how to deal with deficits due to recession and declining revenues. At the Mackinac Center, we believe that government ought to deal with such circumstances the way you and I and families all across the state deal with similar circumstances: curtail spending. That’s especially true if we want to stimulate a weak economy so it will produce more jobs and more revenue. When the patient is ill, the doctor doesn’t bleed him. Five

If you encourage something, you get more of it; if you discourage something, you get less of it.

You and I as human beings are creatures of incentives and disincentives. We respond to incentives and disincentives. Our behavior is affected by them, sometimes very powerfully. Policymakers who forget this will do dumb things like jack up taxes on some activity and expect that people will do just as much of it as before, as if taxpayers are sheep lining up to be sheared.

Remember when George Bush (the first one) reneged under pressure on his 1988 “No New Taxes!” pledge? We got big tax hikes in the summer of 1990. Among other things, Congress dramatically boosted taxes on boats, aircraft and jewelry in that package. Lawmakers thought that since rich people buy such things, we should “let ‘em have it” with higher taxes. They expected $31 million in new revenue in the first year from the new taxes on those three things. We now know that the higher levies brought in just $16 million. We shelled out $24 million in additional unemployment benefits because of the people thrown out of work in those industries by the higher taxes. Only in Washington, D.C., where too often lawmakers forget the importance of incentives, can you aim for 31, get only 16, spend 24 to get it and think that somehow you’ve done some good.

Want to break up families? Offer a bigger welfare check if the father splits. Want to reduce savings and investment? Double-tax ‘em, and pile on a nice, high capital gains tax on top of it. Want to get less work? Impose such high tax penalties on it that people decide it’s not worth the effort.

Right now in both state and federal legislatures, much attention is being given to the question of how to deal with deficits due to recession and declining revenues. At the Mackinac Center, we believe that government ought to deal with such circumstances the way you and I and families all across the state deal with similar circumstances: curtail spending. That’s especially true if we want to stimulate a weak economy so it will produce more jobs and more revenue. When the patient is ill, the doctor doesn’t bleed him.

Russian President Dmitry Medvedev may discuss his proposal to create a new world currency when he meets counterparts from Brazil, India and China this month, Natalya Timakova, a spokeswoman for the president, told reporters by phone today. Russia’s proposals for the Group of 20 meeting in London in April included studying a supranational currency.

“We need some kind of universal means of payment, which could create the basis of a future international financial system,” Medvedev said in a June 1 interview with CNBC. “Naturally, because of the crisis in the American economy, attitude to the dollar has also changed.”

Regional reserve currencies are an “unavoidable” part of “regionalizing” the global financial system, Deputy Finance Minister Dmitry Pankin said in Moscow today.

Read the full article at http://www.bloomberg.com/apps/news?pid=20601087&sid=a3X76sjV801Y&refer=worldwide

 Click here for a print-friendly PDF version of this article.

Introduction

The main purpose for writing this article is to respond to the relentless attempts in recent times to legislate in the European Union, Sunday as an official weekly rest day. The lobbyists championing this cause have been among other associations, the Roman Catholic Bishops (COMECE), some Protestants church representatives and certain Members of the European Parliament (MEPs).[1] I will now provide a synopsis of the background on this issue and show how it has developed to the present day.

The Working Time Council Directive 93/104/EC of 23 November 1993, Article 5, second paragraph stipulated that a minimum weekly rest period ‘shall in principle include Sunday.’[2] Sunday as a weekly rest day was enshrined into European Community Law, but it was annulled by the European Court of Justice (ECJ) after a legal challenge from the United Kingdom government on 12 November 1996.

Based on the Court’s application of Article 137 (ex Article 118a) of the Treaty of the European Union, it was concluded that in so far as the Council was concerned “the connection between the health and safety of workers and the requirement that the weekly rest period ‘shall in principle include Sunday’ in the second sentence of Article 5 of the Directive, had not been established.”[3] There was no satisfactory explanation given “why Sunday, as a weekly rest day, is more closely connected with the health and safety of workers than any other day of the week.”[4] And accordingly the ruling was that the sentence be annulled.

In September 2004, the Commission submitted a proposal to review Council Directive 2003/88/EC. The European Parliament voted the submission at its first reading in May 2005. After a three year period of stalemate, an agreement was only reached in June 2008 at which seven MEPs supported by Catholic Bishops initiated an amendment aiming yet again at attempting to include a Sunday weekly rest day clause previously annulled. The new amendments were not entertained even after the first and the second reading in the House of Parliament due to procedural reasons.[5] And since then, five parliamentarians on 2 February 2009 launched a Written Declaration to lobby the House for its adoption. A majority of 394 MEPs need to sign, before 7 May 2009. The main purpose of the Declaration is to call on “the Member States and the EU institutions to protect Sunday, as a weekly rest day in the forthcoming national and EU working time legislation in order to enhance the protection of worker’s health and the reconciliation of work and family.”[6] I will now proceed to argue that the attempts to enshrine Sunday as a weekly rest day in the European Community remains unlawful, in spite of the launch of a Written Declaration initiative.

Background

The European weekly rest day legislation initially was linked more to the health and safety measures of employees in the work place. The legal basis for it was the Treaty of the European Community Article 137 (previously Article 118a). The Community organisation was to support and complement the endeavours of the Member States to improving primarily ‘the working environment to protect workers’ health and safety.[7] To accomplish its objectives, the Council was to “adopt by means of directives, minimum requirements for gradual implementation…”[8]

The Council of the European Community adopted a Resolution on 21 December 1987 entitled “Safety, hygiene and health at work.”[9] There was no link made between the protection of the worker’s health and safety and Sunday as a weekly rest day nor was it raised as an issue. This argument is supported by the Council’s own affirmation when it officially adopted the measure as a formal Directive on 12 June 1989. It stated that “the objective of this Directive is to introduce measures to encourage improvements in the safety and health of workers at work.”[10] However, Sunday as a weekly rest day with a sociological connotation in Europe began to emerge when the Commission requested the Economic and Social Committee (hereafter ECSOC) to appraise the elements of the Community Charter of Basic Rights. [11] In order to expedite time, ECSOC’s recommendation was for a list to be drawn of basic social principles to be enacted and adhered to by all Member States.

Furthermore, the Community Institutions were to “take the procedural steps necessary to ensure that the scope of these basic principles and rights is interpreted with due respect for the standards already recognised in other international social legal instruments.”[12] The International Labour Conventions 14[13] and 106[14] were cited and reference was made to the weekly rest period but no particular day was suggested. Further, the Council of Europe, Social Charter, Article 2(5) stipulated that “The weekly rest period shall, whenever possible, coincide with the day of the week established as a day of rest by the traditions or customs of the country or district.”[15] Article 2(5) again did not specify the actual week rest day but left it to each country to determine.

The International Labour Convention 106 noted that “The traditions and customs of religious minorities shall, as far as possible, be respected.”[16] The short guide to the Social Charter provided an addendum on respect of Article 2(5) that cited Sunday as the day which all states that had ratified the Charter should incorporate as an official day of rest. At this point, not all Member States had ratified the Charter and therefore the European Parliament could not legislate it. It was left to the discretion for each Member State to decide on the issue.

On 5 October 1990, the Council approached ECSOC for its opinion on the proposal for a Council Directive on the organisation of working time. ECSOC made reference to health as defined by the World Health Organisation which was to be understood as signifying the physical, mental and social conditions and in so doing linked the worker’s health and safety measure to Sunday as a weekly rest day.”[17] In justifying this stance, ECSOC stated that “in countries with Christian traditions the day of rest has to be Sunday.”[18]

The European Parliament debate on the subject of organisation of working time pertaining to Sunday as a rest day followed. I will now provide brief extracts of some arguments put forward by MEPs.

Van Dijk (NL) argued that “The premise that night work ought in principle to be forbidden is, in my opinion, much more important than preserving Sunday as a day of rest. After all, you do not get sicker through working during the day on Sunday than on Mondays, but the same cannot be said of about night work.”[19]

Pronk [PPE]-(NL) said “It remains a day for the family. It is a day of rest in our increasingly hectic societies. We have tabled amendments on this point. We consider it important to preserve that day of rest. After all, one cannot sacrifice everything to society. Certain values remain that we always keep sacrosanct.” [20]

And, Van Der Waal (NI)-(NL) said “I do not wish to plead for EC regulations of Sundays. Sunday legislation is eminently a matter for Governments of Member States and ought to remain so. But it would be important if, in the Directive before us, it were clearly stated that Sunday, as the Christian day of rest, as God’s day, merited a place apart in the internal market.”[21]

However, Papandreou, a Member of the Commission (GR) argued “I do agree, of course, that the week end is the usual acceptable time for rest but given that the proposal is concerned with the health and safety of workers and that there is no direct connection between heath and safety and the weekend. I do not think that we can rightly establish this assumption in the proposal.”[22]

After considering all the arguments, Parliament and the Council of the European Union adopted Directive 93/104/EC of 23 November 1993 inserting Article 5b which included the provision that the minimum rest period ‘shall in principle include Sunday”.[23]

The Sunday weekly rest day in Europe was by law anchored into the European Union in 1993. It must be noted that recital 10 stated that “with the respect to the weekly rest period, due account should be taken of the diversity of cultural, ethnic, religious and other factors in the Member states.”[24] It was “ultimately for each Member State to decide whether Sunday should be included in the weekly rest period, and if so to what extent.”[25] Here again the issue of Sunday law legislation was left for the Member States to decide. But no sooner was the Council Directive in operation, that it faced a legal challenge from the British Government.

Legal Challenge

In March 1994, the United Kingdom of Great Britain and Northern Ireland brought an action under Article 230 (ex Article 173) of the Treaty for the annulment of Working Time Council Directive 93/104/EC of 23 November 1993.[26] The UK Government requested the European Court of Justice to annul the Directive in its entirety or failing which in the alternative to repeal selected provisions which included Article 5, second paragraph (the minimum weekly rest period shall ‘in principle include Sunday’). However, the Council’s rebuttal was that the UK application was unfounded.

The UK Government based its legal challenge on four pleas alleging, (1) defective legal basis (2) breach of the principle of proportionality (3) misuse of powers and (4) infringement of essential procedural requirements.[27] In the first instance, the applicant observed that “Directives adopted under Article 118a(2) of the EEC Treaty must have a genuine and objective link between health and safety, on the one hand, and the situation to be governed by those Directives, on the other.”[28] However, it argued that “In the present case, the link between health and safety is too tenuous for the Directive to be properly based on Article 118a of the EEC Treaty. Thus, for example, the link between the rule of Sunday rest … on the one hand, and on the other, health and safety of workers is as remote as the link between the health of employees and generous conditions of pay.”[29]

However, the UK and the Council of the European Union both recognised the social dimension of the Directive as it comes under the title of Social Policy. Whereas the UK saw a dichotomy between Article 118a, health and safety on the one hand and the social dimension on the other, the Council did not. The UK argued that “the legislator should explain that numerous elements of the Directive were concerned with improvement of the living and working conditions of employees and/or with the social dimension of the internal market rather than with health and safety considerations.”[30] The Council stated however that “any measure adopted on the basis of the Article 118a will thus necessarily pursue a ‘social’ objective” due to Chapter 1 of Title VIII of the Treaty which includes Article 118a.[31]

The most crucial point to bear in mind, especially as relates to the current debate to legislate Sunday as an official weekly rest day by the European Parliament is to seriously consider the legal reasoning and subsequent judgment of the Court of Justice delivered on 12 November 1996.

The European Court of Justice in this leading case considered both arguments and counter arguments from the UK (applicants) and the Council of the European Union (respondents) respectively. It summed up that “In order to deal with those arguments, a distinction must be drawn between the second sentence of Article 5 of the directive and its other provisions.”[32] There was a clear intention by the Court to seek to separate Article 5 second sentence.

The Court concluded in its judgement as follows:

“As to the second sentence of Article 5, while the question whether to include Sunday in the weekly rest period is ultimately left to the assessment of Member States, having regard, in particular, to the diversity of cultural, ethnic and religious factors in those States (second sentence of Article 5, read in conjunction with the tenth recital), the fact remains that the Council has failed to explain why Sunday, as a weekly rest day, is more closely connected with the health and safety of workers than any other day of the week.”[33]

Based on the above the Court upheld the UK government’s alternative claim and annulled the second sentence of Article 5.

Article 5b Annulment and its Compliance

Subsequently, the European Community institutions immediately complied with the judgment of the Court of Justice. At its sitting, the European Parliament on Thursday, 12 December 1996 adopted a Resolution on Sunday work. The adopted measures called:

“Member States and social partners in their transposition of the working time Directive to pay due regard to the traditions and cultural, social, religious and family needs of their citizens and to recognise that special character of Sunday as a day, as usually all family members are free on that day; reaffirms the right of workers to a weekly day of rest…” And also “Member States to recognise that in a multi-cultural society there are also religious communities who may have preference for an alternative rest day.”[34]

Here again, it is important to note that the European Parliament reiterated the discretion of Member States but significantly stated it was imperative that each Member State in their consideration of Sunday as a weekly rest day should take due regard to minority religious groups who may have an alternative rest day.

The Commission concurred with the European Court of Justice for it noted “Article 5 (weekly rest): the second sub-paragraph of Article 5, which refers to Sunday rest, is deleted. This formalises the decision of the European Court of Justice.”[35]

Directives 93/104/EC and 2000/34/EC were both codified.[36] The changes came into force on the date of the Directive’s publication in the Official Journal of the European Communities.”[37]

Attempts to reinstate Article 5b of Directive 93/104/EC

Directive 2003/88/EC of the European Parliament and the Council of 4 November 2003 concerning certain aspects of the organisation of working time without Article 5 subparagraph two was in operation. In 2008, during the revision of the Working Time Directive 2003/88/EC, seven MEPs supported by Catholic Bishops (COMECE) initiated two amendments aiming at including a Sunday weekly rest clause.

The first amendment was a new recital (6a) which sought to explain that “the likelihood of sickness in companies that require staff to work on Sundays is greater than in companies that do not require staff to work on Sundays. The health of workers depends, among other factors, on their opportunities to reconcile work and family to establish and maintain social ties and to pursue their spiritual needs. Sunday, as the traditional weekly rest day, contributes to the objectives more than any other day of the week.”[38]

What then followed was the current proposal amending Article 5(2a) to include “The minimum rest periods referred to in the first paragraph shall in principle include Sunday.”[39] It should be noted this would constitute the introduction of the previously annulled Article 5(2). The justification for these amendments lay in “… Eurofound findings demonstrate that absenteeism and sick-leave increase significantly in companies working on Sunday…””[40]

The amendments aimed at including the protection of Sunday as a weekly rest day were neither debated nor voted on by the European Parliament for procedural reasons.[41] However, the Catholic Bishops appealed to churches and various organisations to stay mobilised on the Sunday issue.

Law Infringement

On 31 January 2000, Jorge Hernandez Mollar (PPE DE), a European Member of Parliament in a written question (E-0170/00) to the Commission sought clarification on the Community’s position on the subject of weekly rest days on religious grounds.

Given the influx of immigrants from Maghreb countries working in various EU states, inquired what provisions were in place considering that “the rest days generally given are Fridays and Saturdays, allowing them to keep these days sacred.”[42] And furthermore, that they be the opportunity “to extend the regulation of weekly rest days on religious grounds and introduce the necessary coordination with the practice usually followed in the Member States of the EU of keeping Sunday as a day of rest.”[43]

The legal response from Mrs Dianantopoulou on behalf of the Commission on the 15 March 2000 reiterated that it was not for the European Parliament or Council to legislate but rather to support and complement Member States.[44] . To the contrary, the Commissioner underlined legal obligations the European Community was expected to adhere. She wrote:

“On 25 November 1999, the Commission adopted a package of two legislative proposals and a proposal for a programme to combat discrimination in the Community based on Article 13 (ex Article 6a) of the EC Treaty.”

“One of these initiatives is a proposal for a horizontal directive to combat discrimination, inter alia, on grounds of religion. Article 12 of this proposal requires Member States to encourage social partners to contribute to the implementation of the principle of equality of treatment by adopting collective agreements, codes of conduct, research or exchange of experiences and good practice aimed at preventing discrimination.”[45]

The ethos of the European Union is therefore to fight religious discrimination. To ignore the annulled Article 5(b) of the Council Directive 93/104/EC as argued by the Court of Justice would be tantamount to an infringement of the Community Law on discrimination.

Submissions

• In the light of the annulment of Article 5(b) of the Council Directive 93/104/EC, I argue that as long as Article 137 (ex Article 118a) is linked to health and safety measures, Sunday law legislation whatever form it may take will be anchored into the European Union by default and thus render it as unlawful. Notwithstanding it is for this reason UK and the Council seemed to have invoked the sociological approach, which seems to provide the current preoccupation on the part of those intending to anchor Sunday law in the European legislation.
• European Member States by law are to decide whether to have Sunday as a weekly day of rest and not the European Community institutions or any other religious group or associations. It is the Member States who must “pay due regard in particular to diversity of cultural, ethnic, and religious factors in those Member States.”[46]
• Religious discrimination is prohibited by European Community law. According to Case 13/63 Italy v Commission “Discrimination may consist not only in treating like cases differently but also in treating different cases alike.”[47] And as such to enact a law that treats the minority groups, who worship on alternative days such as Fridays and Saturdays in the same way as those who worship on Sundays is to discriminate against those minority religious groups.
• Sunday as a weekly rest day violates the human rights against those who may want to worship on an alternative day. Article 9(1) of the Convention provides “the right to freedom of thought, conscience and religion...”[48] But also continues “freedom to manifest one’s religion or beliefs shall be subject only to such limitations as are prescribed by law and are necessary in a democratic society… for the protection of the rights and freedoms of others.”[49]

The Convention has three measures to test the limitations of Article 9 and these are:

(1) when prescribed by law

(2) legitimate aim and

(3) and when is ‘necessary in a democratic society’

Legislation of Sunday as a weekly rest day in the European Union fails on all three counts.

Conclusion

I sincerely applaud efforts to enhance the protection of workers’ health and safety at their workplace and the reconciliation of work and family life, but there is no correlation between these objectives and the need for a legally instituted Sunday rest day.

In my view, the attempt to enshrine Sunday Law in Europe currently in progress through the Written Declaration procedure still remains unlawful. This issue was last before the ECJ in 1993 and it was decided that although the Working Time Directive was properly adopted and in keeping with the Treaty, the second sentence of Article 5 was not, and so was annulled.[50]

The Written Declaration is merely repetition, wrongly adopted and at variance with Article 137 (ex 118a) of the Treaty of the European Union and as such manifestly falls outside of the scope of the Directive. Those pushing for this motion are misdirected in arriving at the inference that their efforts to amend the Directive would be successful by a mere explanation as to why Sunday as a weekly day of rest contributes more than any other day of the week to the health and safety of workers. The fact remains that the explanations submitted with the Written Declaration are repetition of the arguments rejected in previous attempts to amend the Directive and therefore must fail even today.

MEPs are earnestly requested to consider the fundamentals upon which the Union is founded as follows:

• “The Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms and the rule of law, principles which are common to the Member States”.[51]
• “The right to equality before the law and the protection of all persons against discrimination constitutes a fundamental right and is essential to the proper functioning of democratic societies”.[52]
• “The right of individuals not to be discriminated against on arbitrary grounds has long been recognised by International Organisations, the European Union and its Member States”.[53]

My concern is that those advocating for this proposal have again failed to consider the implications of this Legislation. It remains unclear how this law would be monitored, enforced and whether there will be penalties for non compliance. Europe is a multi- cultural and diverse region.

Removing the cloak on this issue, it appears to me that this is just another attempt to use Parliament to make laws which benefit only (Sunday worshippers) and to discriminate those that do not fall within this Criterion. In my view it is clear that accepting the proposed amendment will only serve to infringe the rights conferred by Article 9 (1) of the Convention and will thus discriminate against those that worship on alternative days. None of the measures put in place by the Convention to test the limitations of Article 9 have been established.

Whilst it is wholly appreciated to provide legal protection to ensure that every individual has the right to observe any day of their choice for worship it is entirely inappropriate to force a doctrinal position on all Union Citizens. This matter deserves a full debate engaging all the parties concerned and in particular the minority groups so that the legal position is made clear and that the possible future religious ramifications of this proposed Legislation are considered in light of the aims and objectives of the European Union.

I respectfully ask for a stay of the Written Declaration for reflection and consultation.

[2] Official Journal of the European Communities, Vol.36, L307, 12 December 1993

[3] Case-84/94 United Kingdom v Council of the European Union, Industrial Relations Law Reports, Vol.26, No.1, January [1997] IRLR 32.

[4] Case 84/94 United Kingdom of Great Britain and Northern Ireland v Council of the European Union. Court of Justice of the European Communities Reports of Case before the Court of Justice and the Court of First Instance. ECR 1-5805 and 1-5806, para, 37.

[5] http://www.comece.org/comece.taf?_function=news&_sub=&id=1&langauge=en 18/12/2008

[6] European Parliament Written Declaration DC763921EN.doc

[7] Nigel Foster, Blackstone’s EC Legislation 2005-2006 (Oxford: University Press, 2005), 16^th Edition, p.42

[8] Ibid

[9] Official Journal No. C28/1 (88/C28/01) 3^rd February 1988 – The Council Resolution of 21 December 1987.

[10] Official Journal of the European Committees No. L183/1 (89/391/EEC), 26 May 1989

[11] Official Journal of the European Communities No. C126/4 (89/C126/04), 23 May 1989.

[12] Ibid

[13] Convention 14 Weekly Rest (Industry), 1921, Article 7, International Labour Conventions and Recommendations, Vol.1, 1949-1951, International Labour Office, Geneva, International Labour Organisation. (This Convention came into force on 19 June 1923).

[14]Convention 106, Weekly Rest (Commerce and Officers), 1957, Article 6, International Conventions and Recommendations 1952-1976, Vol. 11, International Labour Offices, Geneva, International Labour Organisation, p.91

[15] European Social Charter, collected texts (3^rd edition) 2002, Council of Europe Publishing, 2003, p.13

[16] International Labour Conventions and Recommendations 1952-1976 Vol. 2 Convention No.106 (Weekly Rest in Commerce and Offices) Article 6(4), p.93

[17] Official Journal of the European Communities, C60, Vol. 34, 8 March 1991, Information and Notices

[18] Ibid

[19] Official Journal of the European Communities, Debates of the European Parliament 1990-1991 session, Report of Proceedings form 18-22 February 1991, Europe House, Strasbourg, p.30. Note that the ILO did not specify the day of the week.

[20] Ibid, p.32

[21] Ibid, p.36

[22] Ibid, p.38

[23] Official Journal of the European Communities, Vol. 36, L307, 12 December 1993

[24] Ibid

[25] Ibid

[26] Case 84/94 UK v Council of the European Union, Court of Justice of the European Communities, Reports of Case before the Court of Justice and the Court of First Instance (ECR 1-5755). In details see also Case 84/94 United Kingdom v Council of the European Union, Industrial Relations Law Reports, Vol.26, No 1. January ([1997] IRLR 1-76)

[27][1997] IRLR 30

[28][1997] IRLR 33

[29] Ibid

[30] UK (Applicant) v Council of the European Union (Defendant) Case 84/94, Industrial Relations Law Reports, Vol. 26, No.1, January 1997, pp 30-31

[31] Ibid

[32] Case 84/94 UK v Council of the European Union, ECR 1-5805

[33] Case 84/94 UK v Council of the European Union, ECR 1-5806

[34] Official Journal of the European Communities C20 Vol. 40 20/01/1997 Minutes of sitting of Thursday, 12 December 1996 B4-1354, 1368,1413 and 1433/96 – Resolution on Sunday Week.

[35] Official Journal of the European Communities, C249, Vol.42, 1 September 1999 (1999/C249/04), Information and Notices

[36] Official Journal of the European Union, C61, Vol. 46, 14 March 2003, Information and Notices

[37] Ibid.

[38] www.cec-kek.org/pdf/CSCProtectionofSunday_EN.pdf 30/03/2009

[39] www.cec-kek.org/pdf/CSCProtectionofSunday_EN.pdf 30/03/2009

[40]www.cec-kek.org/pdf/CSCProtectionofSunday_EN.pdf 30/03/2009

[41] www.cec-kek.org/pdf/CSCProtectionofSunday_EN.pdf 30/03/2009

[42] Official Journal of the European Communities C280 E 03/10/2003 P.0193-0193 http//eur_lex.europa.eu

[43] Ibid

[44] Ibid

[45] Ibid see also Commission of the European Communities, Establishing a General Framework for Equal Treatment in Employment and Occupation, COM (1999) 565 Final, Brussels.

[46] ECR 1-5785 to 1-5786 ECR para.139. see also tenth Recital in OJ L307 Vol.36 13.12.1993

[47] Case 13/63, Italy v Commission [1963] ECR 165 and also Case 130/75, Vivien Prais v Council of the European Communities [1976] ECR 1-1592 and 1-1593.

[48] Henry Steiner and Philip Alston, International Human Rights in Context, Law, Politics and Morals (Oxford University Press, 2000) p.1425

[49] Ibid

[50] Case-84-94 United Kingdom v Council of the European Communities [1996] ECR 1-5809 para.49 and [1997] IRLR 57 para.49. For Actions of Annulment see http://europa.eu/institutions/inst/justice/index_en.htm

[51] Nigel Foster, Blackstone’s EC Legislation 2005-2006 (Oxford: University Press, 2005), 16^th Edition , p.92.

[52] Commission of the European Communities, On Certain Community Measures to Combat Discrimination, COM (1999) 564 Final, Brussels, p2.

[53] Ibid.

An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense — perhaps more clearly and subtly than many consistent defenders of laissez-faire — that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other.

In order to understand the source of their antagonism, it is necessary first to understand the specific role of gold in a free society.

Money is the common denominator of all economic transactions. It is that commodity which serves as a medium of exchange, is universally acceptable to all participants in an exchange economy as payment for their goods or services, and can, therefore, be used as a standard of market value and as a store of value, i.e., as a means of saving.

The existence of such a commodity is a precondition of a division of labor economy. If men did not have some commodity of objective value which was generally acceptable as money, they would have to resort to primitive barter or be forced to live on self-sufficient farms and forgo the inestimable advantages of specialization. If men had no means to store value, i.e., to save, neither long-range planning nor exchange would be possible.

What medium of exchange will be acceptable to all participants in an economy is not determined arbitrarily. First, the medium of exchange should be durable. In a primitive society of meager wealth, wheat might be sufficiently durable to serve as a medium, since all exchanges would occur only during and immediately after the harvest, leaving no value-surplus to store. But where store-of-value considerations are important, as they are in richer, more civilized societies, the medium of exchange must be a durable commodity, usually a metal. A metal is generally chosen because it is homogeneous and divisible: every unit is the same as every other and it can be blended or formed in any quantity. Precious jewels, for example, are neither homogeneous nor divisible. More important, the commodity chosen as a medium must be a luxury. Human desires for luxuries are unlimited and, therefore, luxury goods are always in demand and will always be acceptable. Wheat is a luxury in underfed civilizations, but not in a prosperous society. Cigarettes ordinarily would not serve as money, but they did in post-World War II Europe where they were considered a luxury. The term “luxury good” implies scarcity and high unit value. Having a high unit value, such a good is easily portable; for instance, an ounce of gold is worth a half-ton of pig iron.

In the early stages of a developing money economy, several media of exchange might be used, since a wide variety of commodities would fulfill the foregoing conditions. However, one of the commodities will gradually displace all others, by being more widely acceptable. Preferences on what to hold as a store of value will shift to the most widely acceptable commodity, which, in turn, will make it still more acceptable. The shift is progressive until that commodity becomes the sole medium of exchange. The use of a single medium is highly advantageous for the same reasons that a money economy is superior to a barter economy: it makes exchanges possible on an incalculably wider scale.

Whether the single medium is gold, silver, seashells, cattle, or tobacco is optional, depending on the context and development of a given economy. In fact, all have been employed, at various times, as media of exchange. Even in the present century, two major commodities, gold and silver, have been used as international media of exchange, with gold becoming the predominant one. Gold, having both artistic and functional uses and being relatively scarce, has significant advantages over all other media of exchange. Since the beginning of World War I, it has been virtually the sole international standard of exchange. If all goods and services were to be paid for in gold, large payments would be difficult to execute and this would tend to limit the extent of a society’s divisions of labor and specialization. Thus a logical extension of the creation of a medium of exchange is the development of a banking system and credit instruments (bank notes and deposits) which act as a substitute for, but are convertible into, gold.

A free banking system based on gold is able to extend credit and thus to create bank notes (currency) and deposits, according to the production requirements of the economy. Individual owners of gold are induced, by payments of interest, to deposit their gold in a bank (against which they can draw checks). But since it is rarely the case that all depositors want to withdraw all their gold at the same time, the banker need keep only a fraction of his total deposits in gold as reserves. This enables the banker to loan out more than the amount of his gold deposits (which means that he holds claims to gold rather than gold as security of his deposits). But the amount of loans which he can afford to make is not arbitrary: he has to gauge it in relation to his reserves and to the status of his investments.

When banks loan money to finance productive and profitable endeavors, the loans are paid off rapidly and bank credit continues to be generally available. But when the business ventures financed by bank credit are less profitable and slow to pay off, bankers soon find that their loans outstanding are excessive relative to their gold reserves, and they begin to curtail new lending, usually by charging higher interest rates. This tends to restrict the financing of new ventures and requires the existing borrowers to improve their profitability before they can obtain credit for further expansion. Thus, under the gold standard, a free banking system stands as the protector of an economy’s stability and balanced growth. When gold is accepted as the medium of exchange by most or all nations, an unhampered free international gold standard serves to foster a world-wide division of labor and the broadest international trade. Even though the units of exchange (the dollar, the pound, the franc, etc.) differ from country to country, when all are defined in terms of gold the economies of the different countries act as one — so long as there are no restraints on trade or on the movement of capital. Credit, interest rates, and prices tend to follow similar patterns in all countries. For example, if banks in one country extend credit too liberally, interest rates in that country will tend to fall, inducing depositors to shift their gold to higher-interest paying banks in other countries. This will immediately cause a shortage of bank reserves in the “easy money” country, inducing tighter credit standards and a return to competitively higher interest rates again.

A fully free banking system and fully consistent gold standard have not as yet been achieved. But prior to World War I, the banking system in the United States (and in most of the world) was based on gold and even though governments intervened occasionally, banking was more free than controlled. Periodically, as a result of overly rapid credit expansion, banks became loaned up to the limit of their gold reserves, interest rates rose sharply, new credit was cut off, and the economy went into a sharp, but short-lived recession. (Compared with the depressions of 1920 and 1932, the pre-World War I business declines were mild indeed.) It was limited gold reserves that stopped the unbalanced expansions of business activity, before they could develop into the post-World War I type of disaster. The readjustment periods were short and the economies quickly reestablished a sound basis to resume expansion.

But the process of cure was misdiagnosed as the disease: if shortage of bank reserves was causing a business decline — argued economic interventionists — why not find a way of supplying increased reserves to the banks so they never need be short! If banks can continue to loan money indefinitely — it was claimed — there need never be any slumps in business. And so the Federal Reserve System was organized in 1913. It consisted of twelve regional Federal Reserve banks nominally owned by private bankers, but in fact government sponsored, controlled, and supported. Credit extended by these banks is in practice (though not legally) backed by the taxing power of the federal government. Technically, we remained on the gold standard; individuals were still free to own gold, and gold continued to be used as bank reserves. But now, in addition to gold, credit extended by the Federal Reserve banks (“paper reserves”) could serve as legal tender to pay depositors.

When business in the United States underwent a mild contraction in 1927, the Federal Reserve created more paper reserves in the hope of forestalling any possible bank reserve shortage. More disastrous, however, was the Federal Reserve’s attempt to assist Great Britain who had been losing gold to us because the Bank of England refused to allow interest rates to rise when market forces dictated (it was politically unpalatable). The reasoning of the authorities involved was as follows: if the Federal Reserve pumped excessive paper reserves into American banks, interest rates in the United States would fall to a level comparable with those in Great Britain; this would act to stop Britain’s gold loss and avoid the political embarrassment of having to raise interest rates. The “Fed” succeeded; it stopped the gold loss, but it nearly destroyed the economies of the world, in the process. The excess credit which the Fed pumped into the economy spilled over into the stock market, triggering a fantastic speculative boom. Belatedly, Federal Reserve officials attempted to sop up the excess reserves and finally succeeded in braking the boom. But it was too late: by 1929 the speculative imbalances had become so overwhelming that the attempt precipitated a sharp retrenching and a consequent demoralizing of business confidence. As a result, the American economy collapsed. Great Britain fared even worse, and rather than absorb the full consequences of her previous folly, she abandoned the gold standard completely in 1931, tearing asunder what remained of the fabric of confidence and inducing a world-wide series of bank failures. The world economies plunged into the Great Depression of the 1930′s.

With a logic reminiscent of a generation earlier, statists argued that the gold standard was largely to blame for the credit debacle which led to the Great Depression. If the gold standard had not existed, they argued, Britain’s abandonment of gold payments in 1931 would not have caused the failure of banks all over the world. (The irony was that since 1913, we had been, not on a gold standard, but on what may be termed “a mixed gold standard”; yet it is gold that took the blame.) But the opposition to the gold standard in any form — from a growing number of welfare-state advocates — was prompted by a much subtler insight: the realization that the gold standard is incompatible with chronic deficit spending (the hallmark of the welfare state). Stripped of its academic jargon, the welfare state is nothing more than a mechanism by which governments confiscate the wealth of the productive members of a society to support a wide variety of welfare schemes. A substantial part of the confiscation is effected by taxation. But the welfare statists were quick to recognize that if they wished to retain political power, the amount of taxation had to be limited and they had to resort to programs of massive deficit spending, i.e., they had to borrow money, by issuing government bonds, to finance welfare expenditures on a large scale.

Under a gold standard, the amount of credit that an economy can support is determined by the economy’s tangible assets, since every credit instrument is ultimately a claim on some tangible asset. But government bonds are not backed by tangible wealth, only by the government’s promise to pay out of future tax revenues, and cannot easily be absorbed by the financial markets. A large volume of new government bonds can be sold to the public only at progressively higher interest rates. Thus, government deficit spending under a gold standard is severely limited. The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit. They have created paper reserves in the form of government bonds which — through a complex series of steps — the banks accept in place of tangible assets and treat as if they were an actual deposit, i.e., as the equivalent of what was formerly a deposit of gold. The holder of a government bond or of a bank deposit created by paper reserves believes that he has a valid claim on a real asset. But the fact is that there are now more claims outstanding than real assets. The law of supply and demand is not to be conned. As the supply of money (of claims) increases relative to the supply of tangible assets in the economy, prices must eventually rise. Thus the earnings saved by the productive members of the society lose value in terms of goods. When the economy’s books are finally balanced, one finds that this loss in value represents the goods purchased by the government for welfare or other purposes with the money proceeds of the government bonds financed by bank credit expansion.

In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.

This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.