4. Augustine and the Economy

In the centuries following the rise of the Early Church, dozens of thinkers and writers have taken prominence, offering many interpretations of Christ and his apostles’ words. Some of the teachings would greatly influence the Catholic tradition and thought process. But only a few thinkers would truly rise above their time, such as Origen, Justin Martyr and others. But few stand out as Augustine of Hippo. Augustine is known primarily for his thoughts on theology and the kingdoms of man and God. But underlying his views on cultural and theological development is a rather unique view of economics; a view that has actually influenced modern economics.

According to John D. Mueller, director of the Economics and Ethics Program at the Ethics and Public Policy Center, Augustine’s thought process is still very relevant in light of past popes, including the former Pope Benedict XVI.

According to Mueller, Benedict drew primarily from Aquinas’ thought on scholastic natural law (the practice of using classical philosophy and Christian theology to argue for some form of moral law outside of man’s constructs), but Aquinas himself draws heavily from Augustine’s work. Mueller explains:

In scholastic natural law, economics is a theory of rational providence that describes how creatures who are “rational,” “matrimonial,” and “political” animals choose both persons as “ends” (expressed by our personal and collective gifts) and scarce means that are used (consumed) by or for those persons, which we make real through production and exchange. Thomas Aquinas was the first to integrate these four key elements of scholastic economic theory: Aristotle’s theories of production and justice-in-exchange, Augustine’s theory of utility (which describes consumption), and the scholastic theory of distribution (which comprises Augustine’s theory of personal distribution” gifts and their opposite, crimes” and Aristotle’s theory of domestic and political distributive justice).

In other words, man is naturally a being who can argue, develop relationships and communities, and as such, one must be able to act and express the economic attributes in a meaningful way, something that Augustine does partially with the help of Aristotle. Mueller goes on to note that many aspects of Augustine’s theories eventually transferred on into the work of Smith and Marx, albeit with modification. Smith in particular “de-Augustinized” economics by dropping both distribution and utility, launching classical economics with production and exchange alone.”

But what are these ideas that Smith apparently adopted from Augustine of Hippo?

The first is Aristotle’s concept of fairness in exchange. Aristotle expressed in his Nicomachean Ethics that in order for the Good to be served, exchanged goods and services must have equivalent amounts, otherwise it has no Good.

The second idea mentioned by Mueller is Augustine’s idea of utility, or function. In Augustine’s mind, physical objects have two primary purposes, either they make us happy, or they provide us ‘use’ or purpose. The best way to understand this is in regard to food. Suppose for a second that we are offered one of three things, a sandwich, a salad and a piece of cake. If you eat the meat, you would get all the benefits, but you may not enjoy it. If you eat the cake, you will suffer calorie/ingredient-wise but you will enjoy the food. And if you eat the sandwich, you enjoy both. According to Theology professor John H. Wright:

From an anthropological perspective, the distinction bears an inherent teleology: “To enjoy something is to cling to it with love for its own sake. To use something, however, is to employ it in obtaining that which you love” (I.4). The distinction helps Augustine provide, in terms of ancient philosophy, a “therapy of desire” for human action in which human desire may be formed rationally towards the unity of what is True, what is Good, and what is Beautiful.

In other words, it is the fusion of a heart’s desire and an object’s usefulness that determine its viability.

Finally, Wright mentions the scholastic theory of distribution. In essence, this theory establishes how one’s view of an object’s value and its relations to any significant actions. If the product is willingly given with higher value in exchange for lower or even no value, it is a gift. If a product is taken unwillingly, then it is a crime.

Now, all of this does not exist by itself. Augustine’s thoughts exist in a governmental framework all on their own.

The Internet Encyclopedia of Philosophy describes Augustine’s view of government as follows:

The state is a divinely ordained punishment for fallen man, with its armies, its power to command, coerce, punish, and even put to death, as well as its institutions such as slavery and private property. God shapes the ultimate ends of man’s existence through it. The state simultaneously serves the divine purposes of chastening the wicked and refining the righteous. Also simultaneously, the state constitutes a sort of remedy for the effects of the Fall, in that it serves to maintain such modicum of peace and order as it is possible for fallen man to enjoy in the present world.

In other words, the government is what regulates trade and punishment and protects the rights of the owner, just as the limited forms of Jewish government kept things operating beyond the standard religious leadership. It is, however, a weak yet necessary system due to man’s fallen nature, along with eventually becoming unnecessary after the Second Coming of Christ.

So government is not necessarily something that will continue into the next Kingdom, but is a requirement to moderate life in this sinful world. After all, “What are kingdoms without justice? They’re just gangs of bandits.” (City of God)

This is also partially due to Augustine’s notion regarding the duality of the two Kingdoms. Augustine views the world and the relations between governments as two cities: the City of Man and the City of God. The City of Man is what regulates life on the mortal level, including issues of justice and mortal affairs. In contrast, there is the City of God, which rules over all spiritual and religious affairs. These two cities exist separately and yet in unison. What is the exact nature of their relationship? For Augustine, he sees the two as overlapping and intertwined, albeit with the City of God influencing the goals of the City of Man, even if the residents of the City of Man do not realize or desire it.

Now, will trade continue to occur in the next kingdom? While the act itself relies heavily on human regulation, the goods and services are not necessarily negated in that kingdom, outside of statements from Augustine about living in full community. So trade and economic levels may be less necessary for managing life needs, but they serve the positive functions listed in our earlier piece on Jewish views on economics; including the dominion mandate and service to the poor.

While Augustine is first and foremost a theologian, he provides a simple framework to think through some level of economic activity, primarily by way of providing some language to talk about the way we trade goods and how moral concepts play into it. The bishop also lays out government as a flawed human concept, albeit a necessary one enforced by God in order to keep his people in line and honest.