In the United States, there have been a number of confrontations between established government policy and religious convictions. Christians in America have repeatedly thought that government policies contradicted their biblically-based moral values. During the 2008 economic crisis, there was also a lot of speculation about how the government handled its economic policies and obligations (Reisenbichler, 2020). Christians have raised a number of concerns about how most government economic organizations carry out their duties in light of biblical teachings.
Federal Reserve Functions and the Bible
The Federal Reserve is the central bank of the United States and the most powerful financial institution in the world. The US Congress established it in 1913 to provide the country with a stable, flexible, and secure financial and monetary system (Binder & Spindel, 2019). The following are the Federal Reserve’s main functions and activities. By adjusting interest rates and increasing or decreasing the cost of credit, it has an impact on the rate of inflation. The Federal Reserve determines the funds’ rate, which is the rate at which banks lend money to one another. To control the funds’ rate, the Fed uses securities to conduct operations and can buy them out, therefore expanding the money supply.
Despite the fact that the Federal Reserve is designed to assist the economy and the well-being of Americans, the institution has a number of moral difficulties. Furthermore, by establishing the Federal Reserve System and managing money demand/supply, the government has transgressed numerous biblical precepts and ideals. The current monetary policy is intended to counteract all of the ups and downs that occur in a free market economy by forcing the economy to develop at a set rate. “The Lord sends poverty and wealth; he humbles, and he exalts,” says the Bible (Samuel 2:7). However, the policy and functions of the Federal Reserve challenge the idea of accepting God’s will and His decisions to grant or take wealth. The central planning method to wealth redistribution breaches the free market principle, which can be considered as the expression of God’s will in this context.
There is one other very closely related violation of biblical precepts disguised in the government’s and Federal Reserve’s acts. The Bible emphasizes that prosperity is earned by hard effort rather than speculation or other forms of deception: “Lazy hands make for poverty, but diligent hands bring wealth” (Proverbs 10:4). The idea of expanding the money supply while maintaining inflation at a consistent level of 2% to 3% already clashes with the biblical approach of using honest and accurate scales and weights. The current approach to the money supply, in which the Fed purchases more securities in order to increase the total amount of money in the system, is morally inappropriate: wealth is separated from actual material value, and when the money supply is increased, the dollar’s value falls, and prices rise to match the new money supply.
The Federal Reserve’s third biblical principle breach is that the entire mechanism of dispersing money between banks necessitates several loans and results in indebtedness among all involved banks. The Bible, on the other hand, expressly forbids numerous debt sequences: “If you take your neighbor’s cloak as security for a loan, you must return it before sunset” (Exodus 22:26). Thus, all the debts and loans operations held by the Federal Reserve overstep the biblical principle.
In conclusion, there are a number of instances that show how the economic policies of the Federal Reserve overcome biblical principles. Some of the policies do not meet the idea about wealth and poverty as described in the Bible. Such activities as debts practiced by the Federal reserve are also controversial to the Christian ideas. The financial institution has created distinct approaches and strategies to the fluctuation, loans, and managing demand and supply, which do not always correlate with the principles described in the Bible.
Binder, S., & Spindel, M. (2019). The myth of independence: How congress governs the federal reserve. Princeton University Press.
Exodus 22:26. The Bible.
Proverbs 10:4. The Bible.
Reisenbichler, A. (2020). The politics of quantitative easing and housing stimulus by the Federal Reserve and European Central Bank, 2008‒2018. West European Politics, 43(2), 464-484. Web.
Samuel 2:7. The Bible.