Economics
The parable of the talents: the Bible and entrepreneurs
The parables of Jesus teach eternal truths, but they also offer surprising practical lessons for worldly affairs. In the Gospel According to Matthew (chapter 25, verses 14-30) we find Jesus' Parable of the Talents. As with all the biblical parables, it has many layers of meaning. Its essence relates to how we are to use God's gift of grace. As regards the material world, it is a story about capital, investment, entrepreneurship, and the proper use of scarce economic resources. It is a direct rebuttal to those who see a contradiction between business success and living the Christian life.
A rich man who was going on a long journey called his three servants together. He told them they would be caretakers of his property while he was gone. The master had carefully assessed the natural abilities of each servant. He gave five talents to one servant, two to another, and one to the third – to each according to his ability. The master then left on his journey.
The servants went forth into a world open to enterprise and investment. The servant who had received five talents went into business and made five more. The servant who received two made two more. But the servant who received one hid the master's property in a hole in the ground.
The master returned to settle his accounts. The servant who had received five talents came forth. "My lord," he said, "you entrusted me with five talents; see, I have made five more!"
"Well done, good and faithful servant!" the master responded. "You have been faithful over a little, I will set you over much. Enter into the joy of your lord!"
Then the servant who had been given two talents approached the master. "My lord," he said, "you entrusted me with two talents; see, I have made two talents more!" The master praised the servant in a like manner.
Then the one who had been given one talent approached his master. "My lord," he said, "I knew you to be a hard man; you reap where you have not sown, and gather where you have not scattered; and being afraid I went and hid your talent in the ground. See, you have what is yours!"
The master's response was swift and harsh: "You wicked and indolent slave! You were aware that I reap where I have not sown, and gather where I have not scattered; you ought for that reason to have invested my money with the bankers; then, on my return, I should have received my own with interest."
The master ordered that the talent be taken away from the lazy servant and given to the one with the ten talents. "For to every one who possesses not," said the master, “even that which he has shall be taken away. Cast that useless slave into the outer darkness; there shall be weeping and the grinding of teeth!"
This is not a story we often hear from the pulpit. Our times still exalt a socialist ethic where making a profit is suspect, and entrepreneurship is frowned upon. Yet the story relays a readily apparent ethical meaning, and even deeper lessons for understanding human accountability in economic life.
A Closer Look
The word "talent" in this parable has two meanings. It is a monetary unit: it was the largest denomination of the time. Biblical scholar John R. Donovan tells us a single talent was equivalent to the wage of an ordinary worker for fifteen years. So we know the amount given to each servant was considerable.
More broadly interpreted, the talents refer to all of the various gifts God has given us for our use. This definition embraces all gifts - natural, spiritual, and material. It includes our natural abilities and resources our health, education - as well as our possessions, money, and opportunities.
One of the simplest lessons from this parable is that it is not immoral to profit from our resources, wit, and labor. The alternative to profit is loss, and surely the loss of wealth, especially when due to a lack of initiative, does not constitute good stewardship.
Matthew's parable presupposes a local understanding of the proper stewardship of money. According to rabbinical law, burying was regarded as the best security against theft. If a person entrusted with money buried it as soon as he had it in his possession, he would be free from liability if anything should happen to it. The opposite was true for money that was tied in a cloth. In this case, the person was responsible for covering any loss incurred due to the inadequate care of the deposit.
Yet in this story, the master turned this understanding on its head. He considered burying the talent - and thus breaking even - to be a loss, because he thought that capital ought to earn a reasonable rate of return. In this understanding, time is money (or interest).
The parable also contains a critical lesson about how we are to use our God-given capacities and resources. In the book of Genesis God gave Adam the Earth with which to mix his labor for his own use. In the parable, in a similar manner, the master expected his servants to seek material gain. Rather than passively preserve what they have been given, they were expected to invest the money. The master was angered at the timidity of the servant who had received the one talent. God commands us to use our talents towards productive ends. The parable emphasizes the need for work and creativity as opposed to idleness.
The Quest for Security
Throughout history, people have tried to construct institutions to provide perfect security, as the failed servant did. Such efforts range from the Greco-Roman welfare states, to full-scale Soviet totalitarianism, to the Luddite communes of the 1960s. From time to time, these efforts have been embraced as Christian solutions to future insecurities. Yet in the Parable of the Talents, courage in the face of an unknown future is rewarded in the first servant, who has been given the most. He had traded the five talents, and in doing so, acquired five more. It would have been safer for the servant to have invested the money in the bank to receive interest. For his faith in his master he is allowed to keep what had been entrusted to him and what he earned, and he is invited to rejoice with the master.
This implies a moral obligation to confront uncertainty in an enterprising way. No one does this better than the entrepreneur. Long before he knows if there will be a return on his investments or ideas, he risks his time and property. He must pay out wages long before he has any idea if he has accurately predicted future events. He looks to the future with courage and a sense of opportunity. In creating new enterprises he opens up alternatives for workers to choose among in earning a wage and developing skills.
Why, then, are entrepreneurs so often castigated as poor servants of God? Many religious leaders speak and act as if the businessman's use of his natural talents and resources to turn a profit is immoral, a notion that should be cast aside in light of the Parable of the Talents. The lazy servant could have avoided his dismal fate by being more entrepreneurial. If he had made an effort to trade with his master's money and came back with less than a talent, he would not have been treated so harshly, for he would have labored on behalf of his master.
Entrepreneurship and Greed
Religion must begin to recognize entrepreneurship for what it is - a vocation. The ability to succeed in business, stock trading, or investment banking is a talent. Like other gifts, it should not be squandered, but used to its fullest for the glory of God. Critics link capitalism with greed, yet the fundamental nature of the entrepreneurial vocation is to focus on the needs of customers. To succeed, the entrepreneur must serve others.
Greed is a spiritual hazard that threatens us all, regardless of our wealth or vocation. The term has a proportional element, meaning there is an excessive or insatiable desire for material gain, regardless of financial status. The desire is excessive when, in the depths of a person's being, it outweighs moral and spiritual concerns. This parable makes very clear that wealth as such is not unjust - for the first servant received more than the second and third. And when turning a profit is the goal of using the entrepreneurial talent, it is not greed. It is the proper use of the gift.
In addition to condemning profit, religious leaders often favor varieties of social leveling and redistribution of income. Universal health care, greater social welfare spending and higher taxes on the rich are all promoted in the name of Christian ethics. The ultimate goal of such constructs is equality, as if the inequalities that exist among people are somehow inherently unjust. Yet this is not how Jesus tells it in the Parable of the Talents. The master entrusted to each of his servants talents according to his ability. One received five, while another received only one. The one who received the least does not receive sympathy from the master for his lack of resources in comparison to what his colleagues have been given.
We can infer from this parable leveling of money or the reallocation of resources is not a proper moral concern. The individual talents and raw materials that each of us has are not inherently unjust; there will always be rampant inequalities among people. A moral system is one which recognizes this and allows each person to use his or her talents to the fullest. We all have the responsibility to employ the faculties with which we have been endowed.
We can also apply the lesson of this parable to our nation's social policy. In our existing system, the labor of workers is taxed to provide support for many who do not work. We often hear that there are "no jobs" for many of our poor. Yet there is always work to be done. A man with two working hands can find work for a dollar an hour. He makes a decision not to work. Moreover, our welfare system discourages work. It creates the perverse incentive to go on welfare unless there is a job that will pay at least as much as government relief. God commands all people to use the talents they have been given, yet in the name of charity our welfare system encourages people to let their natural skills atrophy, or keeps them from discovering their talents at all.
We encourage sin this way. The Parable of the Talents implies that inactivity - or wasting entrepreneurial talent - incites the wrath of God. After all, the lowly servant had not squandered his lord's money; he just hid it in the ground, something that was permissible in rabbinical law. The rapidity of the master's reaction is surprising. He calls him "wicked and slothful" and banishes him forever. Apparently it is not just the servant's sloth that brings such wrath on his head. He has also shown no contrition, and has blamed the master for his timidity. His excuse for not investing the money is that he viewed the master as a hard and exacting man, though he had been given generous resources. Bible scholar John Meir comments, "Out of fear of failure, he has refused to even try to succeed."
This parable also tells us something about macroeconomics. The master went on his journey leaving behind a total of eight talents; upon his return it has become fifteen. The parable is not the story of a zero-sum gain. One person's gain is not another's expense. The successful trading of the first servant does not hinder the prospects for the third servant. So it is true in the economy of today. Unlike what is so often preached from some pulpits, the success of the rich does not come at the expense of the poor.
If by becoming rich the most successful servant had hurt others, the master would not have praised him. A wise use of resources in investment and saving at interest is not only right from the individual point of view; it helps others in the economy as well. A rising tide lifts all boats, as John Kennedy used to say. Similarly, the wealth of the developed world is not on the backs of developing nations. The Parable of the Talents implies a free and open economy.
Often left-leaning Christians will cite Jesus' words: "How hard it is to enter the Kingdom of God. It is easier for a camel to pass through the needle's eye than for a rich man to enter the Kingdom of God." His disciples were taken aback at this, and wondered then who could be saved. Jesus answers their fears, "For man it is impossible, but not for God." This does not mean that our material success will keep us from heaven, yet it does imply the necessity to order our lives properly before all our material concerns. Our concern for God must come just as the servants thought of their master's interest as they pursued profit. It remains true that for all of our worldly goods and deeds, we rely completely on God to attain salvation.
But for the conduct of economics, we rely heavily on entrepreneurship, investment, risk taking, and the expansion of wealth and prosperity. We should lend a critical eye to the way our culture treats enterprise. Business magazines carry stories of business success all the time. The hero is often the forward-looking, courageous, and cheerful entrepreneur, who is much like the capable servant given five talents. Yet at the same time popular religious faith continues to extol and promote behavior endemic to the idle servant who was banished by the master.
Christianity is often blamed for the failed socialist projects the world over. And in many cases misguided Christians have been involved in building socialist constructs. The lesson of the Parable of the Talents needs to be better understood. The socialist dream is not a moral one. It simply institutionalizes the condemned behavior of the lesser servant. Where God commands creative action, socialism encourages laziness. Where He demands faith and hope in the future, socialism promises a base form of security. Where the Parable of the Talents implies the morality of freedom to trade, invest, and profit, socialism denies it.
All people of faith need to work to close the chasm that exists between religion and economic understanding. Jesus' parable is a good place to begin to incorporate the morality of enterprise and the free market into Christian ethics.
This article first appeared in the March 2000 issue of the magazine.
It is reprinted with permission from the Freeman.
