Money and the Kingdom of God

The idea of kingdom implies a king and a domain over which the king reigns. Given a created universe and a sovereign Creator who wishes to rule, then the universe is the domain of the Creator.

From a Christian worldview, Christ is the Creator and King over the universe. This means that he is the sovereign Lord over everything, including monetary systems. For a monetary system to be submitted to the king, it must be aligned with his will and ways.

Prior to the twentieth century, monetary systems were largely based on precious metals, such as gold and silver, and on base metals, such as copper and nickel. Generally, governments issued money in the form of coins made from either precious or base metals. Such money had two sources of value: first, the fiat value defined by the issuing entity and second, the intrinsic value of the metal. At times the intrinsic value exceeded the fiat value. Money issued in the form of coins was—and is—called specie.

During the past millennium, the world’s monetary systems have slowly moved away from commodity-backed currencies (specie and paper convertible to specie or bullion) to unbacked fiat systems. Today there are ~167 currencies worldwide. As far as I know, all are unbacked fiat systems.¹

Economic challenges—such as the Great Depression of the 1930s—over time drove the ubiquitous conversion to fiat monetary systems. This transition was the by-product of a number of assumptions made by public policy officials, such as:

• Wisdom is no longer based on revelation from Scripture but on principles determined by naturalistic cause and effect.
• If the money supply was coupled to precious or base metals, the money supply would be limited by the current inventory and growth rate of mining these metals.
• Governments should stimulate economic growth through monetary policy. Growth can be stimulated through regulation of the money supply, tax policy, and government debt with few negative consequences.
• Since there is no day of reckoning, government does not have to pay back its debt. There is no reason, therefore, to be concerned about sovereign debt levels.

Biblically, all these assumptions are at least dubious, if not clearly wrong. Wisdom disconnected from Scripture is not true wisdom. Money supply connected to metals is the soundest monetary system. The role of government is not to stimulate economic growth but to provide a context for healthy godly economic activity. And there is a day of reckoning for all debtors—borrowers are accountable to lenders.

Monetary policy based on the above assumptions ignores biblical revelation and in particular it ignores the reality of “gold in the garden” noted in the above text. Based on this text, it appears that the Creator anticipated the need for monetary systems to facilitate mankind’s role of ruling his creation according to the Creation Mandate.² Given that God creates humans uniquely, which means no one has all the gifts necessary to be fully self-sufficient, then humans must be interdependent. Mankind needs, therefore, to have a way to trade goods and services.

How should mankind develop sound monetary systems? If the mention of “gold in the garden” is a clue, then commodity-backed systems will be superior to unbacked fiat systems. Ignoring the standard of the king of the universe is rife with risk. Consequently, unbacked fiat monetary systems—and the assumptions that justify them—will in time prove to be fatally flawed.

Here is your business tip. Management must be aware of the assumptions that underlie the world’s monetary systems and recognize the risk associated with nonbiblical monetary policies. The degree to which these policies are inconsistent with a Christian worldview is accordingly a measure of the risk. In the end, nonbiblical systems will prove to be flawed and will produce chaos, making orderly business difficult. Therefore, organizational management, in whatever way possible, must encourage public policy aligned with Scripture and be monetarily wise about debt, investments, and reserves for difficult times. Debt should be used with prudence. Investments should reflect the wisdom of diversification not faddishness. Reserves should be segregated from working capital and used only in the event of true emergencies.