By Jesse Sumpter
Thursday, April 9, Acton Institute hosted a live conversation on Zoom between David Bahnsen and Fr. Robert Sirico about the current Covid-19 Economic situation.
David Bahnsen is the Managing Partner and Chief Investment Officer of The Bahnsen Group, managing over $2.25 billion in client assets. Bahnsen was recently on CrossPolitic to talk about the Stimulus Package (link below).
Thursday’s conversation began with Bahnsen expressing concerns at the latest news that the Federal government was getting heavily involved in the market, even to the point of buying junk bonds. He said this new action is problematic because it will hide the true value of production from businesses and producers so that they will not know how to price things. The government would be artificially keeping prices high which would hide what Bahnsen called price discovery. This means that producers will be flying blind.
Bahnsen also expressed concern that the federal government will not rest with just stimulating the market but will take over the market and actually become the market.
Fr. Robert Sirico, President of Acton Institute, asked Bahnsen about how the government might grow in power during this time of crisis.
Bahnsen said he agrees that there is a concern. He then pointed out that the government’s power will grow in this time, not because the government is taking the power but because the people are giving the power. He said that was what happened with the New Deal and Franklin Delano Roosevelt. Fr. Sirico followed up saying that he points people back even farther in history to the book of Samuel where the people ask for a king. Bahnsen agreed that it is there where we see the seductive nature of statism. The people specifically asked the state to grow.
The live discussion also took several questions from attendees.
One question asked about the situation in South America. Banhsen said that the United States is in a different situation from South America. While the recent practice of the United States is to carry lots of debt, the rate of production is still high. This production rate balances things out and it puts the United States in a different place than other countries. In South American countries, the problem is one of production. The government of Venezuela and Argentina can try to stimulate the economy but it won’t help because they are not producing enough. America does not have that problem. So the situation is different. Bahnsen said that there is still a problem in the United States but it will fall out differently than South America.
Another question asked about America’s relationship with China. Bahnsen said that this is a great time to make the right moral case against China. Our relationship with China is not about economics; this is a moral issue. Bahnsen insisted that the right argument against China is that it is an evil communist regime. That is why we should not be doing business there. He said he thinks that the American government will give incentives to companies in order to bring them back to America. That will have some impact on China but it will be a slow process.
Another question asked about other parts of the recent government stimulus bill. The issue of Small Business loans came up. Fr. Sirico expressed concerns that religious organizations will take the loans. He said that the Acton Institute and his own parish have decided to decline those loans. He expressed concern that the loans would force these religious organizations to accept the government’s regulations and policies about various practices. He didn’t want to get entangled in that.
Then Fr. Sirico said even if there were no strings attached to the loans, he would still be concerned by the mentality behind these loans. The assumption behind the loans is that people should never have to make sacrifices. But that is not true. In hard times, we need to recognize that we need to make sacrifices. He said that Acton has had to do that. We cannot think that we must run to the government every time something goes wrong.
Bahnsen agreed and said that the principle of thrift is a key element in the human economy. People must learn that now.
The last question was about the church’s role in the crisis. Fr. Sirico said that he has been concerned about how the government has treated churches as not essential. He said in Grand Rapids, Michigan where he lives, chaplains were not allowed to go into hospitals to minister to people even at the point of death. He said thankfully that has been corrected now. But that was a problem.
He also discussed how church officials should really have been in the discussions earlier on. Bahnsen agreed that states should have issued guidelines and then allowed the churches to decide how to implement them in their own particular situations.
Fr. Sirico said he is also concerned at this time that churches are sending the message that they are closed down. But he said the church is not closed down. There is much to do.
He also said that he is concerned with how the government has presumed the church to be not an essential service. That is concerning when pizza places and grocery stores are allowed to be open. Churches can follow the same rules as these places so why should churches be closed?
He finished by saying he is concerned about the impact this will have on church practices in the future.
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Crosspolitic Interview with David Bahnsen: