Ground rent

The message of the Bible: the kingdom of God

Summary

• In a real kingdom, only two laws really matter:
  
  1. Who is in charge?
  2. Who can take my money?
• Moses' answer was:
  
  1. No kings (temporary judges instead)
  2. No taxes

The Old and New Testaments summarised

The Old Testament is "the law and the prophets". The law is the laws of Moses, and the prophets urge people to keep it. The law of Moses was a response to Israel's time as slaves in Egypt: it was designed to ensure that the Israelites could never be slaves again. How? First, by giving each family its own land, and second, by replacing taxation with tithing on crops: a form of ground rent.

'Old testament' mean 'old covenant' or 'old contract'. The old and new contracts are defined in Jeremiah 31.. A contract is a two way promise. If we keep the laws of God (i.e. the laws of logic) the nation will be strong.

The most important laws

Moses had many laws, but from the perspective of running a nation the most important laws are those concerning land ownership.

Moses taught that land should be shared equally and there should be no tax. A tithe on produce from the land could pay for any national needs. Later, Jesus said that land could be sold, but rent must be paid.

These laws naturally lead to prosperity and justice, because they ensure that nobody can become rich by taking money from somebody else: everyone must work, and work fairly. Let's look at the details.

The old contract

The Old Testament is about a nation and its laws, so it is best understood in macroeconomic terms:

1. 'God owns the land.' People on the land are simply stewards.
2. 'We must keep his laws.' His laws are laws of a good economy, and sound contracts. Put another way, we owe society. When people keep God's laws the nation thrives. When people do not, the nation fails.
3. 'Thou shalt not steal.' Stealing undermines an economy. Stealing is taking wealth we did not create. So taxation is stealing. (In contrast, land value is not earned so should be shared equally: ground rent pays for roads, security, etc.)

Tax destroyed Israel. The nation split apart because of Rehoboam's tax policy. Tax then weakened the nations economy so it was an easy prize for any aggressive neighbour: Egypt, then Assyria, then Babylon, the Greece, then Rome. Tax is economic suicide.

In modern economic terms, society should charge ground rent, but should never tax work.

Land owners are God's tenants

'Dress': Hebrew "abad" - to work or serve. Adam was a worker, a servant in the garden.

'Keep': Hebrew "shamar" - keep, guard, observe, give heed. In other words, to look after it (for God). Adam cannot have had any legal title to the land, because God told him what to do on the land, and later threw him out.

This is a major theme repeated again and again in the Old Testament: God owns the land, not us. We are merely tenants. The earth belongs to God (Psalm 24:1; 89:11, Isaiah 14:2; Hosea 9:3; Joshua. 22:4). God is "adon kol-haarets" or the 'Lord / Master of the whole earth' (Joshua 3:11; Psalm 97:5; Micah 4:13). Just before entering the promised land Moses reminded the people many times that the land is the Lord's (Deuteronomy 4:21, 38; 12:9; 15:4; 19:10).

"The land shall not be sold for ever: for the land is mine, for you are strangers and sojourners with me. " (Leviticus 25:23) (see later commentary on this verse)

The law: we only own what we create

When Adam and Eve leave Eden the lord God (i.e. the word of logic, not just the lord on his own) makes various statements. First, the serpent broke his contract so loses his job. Next he tells Eve that raising children (outside the garden) will be very hard, and her rebellion has not brought freedom for womankind. Then he turns to Adam and says:

This was a statement of the obvious at the time, but illustrates the most essential law of all: you have to pay for what you get, and you get no more than you pay for. Obviously we can appear to break this rule: Adam thought he had broken it by being chosen to tend the garden, he had less work and more reward. But it was an illusion: in reality the ruler was in charge, and as Eve found to her cost that power could be abused. Even if the ruler had been perfectly benevolent it was still an artificial situation: the rulers had taken the best land for themselves, and sooner or later the ordinary people would rebel. Even if they didn't, this was economically inefficient: there is no reason to think the rulers were the best possible users of that land.

Whichever way we look at it, selfishness means economic weakness. This is nowhere more obvious than when cast out into a desert:

Economics from a desert

When economists try to explain a concept they often use the desert island scenario: e.g. imagine two men on a desert island, and each wants what the other has: do they fight or do they trade? This is because a desert focuses the mind. It removes all but the basics. It makes life hard, you are forced to face the basic realities of life.

The law of God always comes from a desert:

• Adam and Eve were cast out of the garden and forced to live in the dust by the sweat of their brow.
• The law of Moses was given in the desert.
• Jesus spent forty days fasting in the desert before his ministry.

The desert is where economics is understood at its purest. Where every person must work hard for every mouth of food if the community is to survive.

If we accept "work for what you have" as the fundamental rule of economics then it means we cannot benefit simply from luck, or from forcing others to work against their will.

This will be the theme of the Old Testament: the need to escape from slavery (whether in Egypt of from your kings), and laws such as land rent that both maximise economic growth and enable each person a fair chance to enjoy the fruit of their labours.

The ten commandments

The ten commandments are economic rules. They can be summed up in two rules: respect property and respect contracts. This can in turn be summed up in one rule: create your own wealth, do not take your neighbour's. Or as Jesus put it, love God (i.e. love logic) and love your neighbour.

1. Thou shalt have no other gods before me.
2. Thou shalt not make unto thee any graven image, or any likeness of any thing that is in heaven above, or that is in the earth beneath, or that is in the water under the earth. Thou shalt not bow down thyself to them, nor serve them...
3. Thou shalt not take the name of the Lord thy God in vain; for the Lord will not hold him guiltless that taketh his name in vain.
4. Remember the Sabbath day, to keep it holy. Six days shalt thou labour, and do all thy work: But the seventh day is the Sabbath of the Lord thy God: in it thou shalt not do any work...
5. Honour thy father and thy mother: that thy days may be long upon the land which the Lord thy God giveth thee.
6. Thou shalt not kill.
7. Thou shalt not commit adultery.
8. Thou shalt not steal.
9. Thou shalt not bear false witness against thy neighbour.
10. Thou shalt not covet thy neighbour's house, thou shalt not covet thy neighbour's wife, nor his manservant, nor his maidservant, nor his ox, nor his ass, nor any thing that is thy neighbour's.
    (Exodus 20:3-17)

These are all about contracts and property:

'Do not steal' is about property.

'Do not lie' ensures good agreements (contracts).

'Do not commit adultery' is about a contract (marriage).

'Do not kill' is about property (our life is our greatest property).

'Honour parents' is about a social contract: they care for you, so you should care for them.

The remainder of the ten commandments are a reminder to keep these rules:

'Nothing comes before God': nothing comes before logic.

'No worshipping idols': only logic should be worshipped.

'Remember the Sabbath day': take time to remember these rules.

The last of the ten commandments (or the last two if we count 'love God' and 'no idols' as one commandment) is to 'not desire (covet) your neighbour's house' and not to desire anything that is your neighbour's. This last commandment (or last two commandments) explains all the rest. It we are not to desire what others have then we have to create our property on our own.

The only way we can create property on our own is by the sweat of our brow. This was the first thing told to Adam and Eve when they left the garden of Eden. Some argue that we should not desire property at all, but of you do that then you will die, because you need food and shelter and those are forms of property. The final commandment is only about not envying what others have created.

In short, the ten commandments imply that you only own what you create. As we shall see in part 6 of this book, that is the basis for Jesus' economic teachings.

Work was not to be taxed

When the people arrived in the promised land everyone was given a roughly equal share of land. Or rather, everyone except the Levites. They only had their cities and a little land immediately around them (Leviticus 25:34). The Levites did other jobs as well: they were:

1. teachers (Deuteronomy 24:8; 33:10; 2 Chronicles 35:3; Nehemiah 8:7).
2. often judges(Deuteronomy 17:8'9; 21:5; 1 Chronicles 23:4; 2 Chronicles 19:8; Ezekiel 44:15, 24)
3. doctors (Leviticus 13:2, 14:2; Luke 17:14).
4. professional singers and musicians (1 Chronicles 25:1'31; 2 Chronicles 5:12; 34:12).
5. producers of books (2 Chronicles 34:13).
6. law enforcers (1 Chronicles 23:4).
7. architects and builders (2 Chronicles 34:8'13).

In other words, while most people were farmers, the Levites did the other jobs.

The farmers paid ground rent, but other work was not taxed.

Kings must not have taxes

Moses said that most disagreements should be settled locally, and if there are serious problem,s to bring them to the Levites:

He then says what to do if the people decide to have a king.

Since he cannot greatly multiply his property he must have more or less the same wealth as others have. 

The law of course says he should not covet the property of others. There is no place for taxation in this scenario.

How could they live with no taxes?

Elites always want to tax others, but there was no need for taxation in bronze age Canaan:

• Roads only needed to be dusty tracks: this was a dry, decentralised nation with a low population.
• There were no professional armies: farmers had their own swords.
• Schooling, healthcare, etc. were handled locally.
• The Levites handled any difficult legal questions.

For more complex nations see ground rent, below.

Taxing work breaks all ten commandments

Tax on work means breaking all ten commandments at once:

'1. I am the LORD thy God. Thou shalt have no other gods before me. '

Tax allows one person (king) complete power to take anything he wants, as if he was God. This rewards bad government. In contrast, land rent encourages equality: as the work is untaxed people can become rich. If the king tries to take too much ground rent they can simply use less land. The people can be traders and artisans, selling and buying their food from neighbouring states until the king, bankrupt, sets a level of tax where it is reasonable to farm once again. Ground rent creates wealth and equality. Tax creates false gods.

'2. No graven images or likenesses'

The second commandment clarifies the first. Logic is abstract. It is not some person or thing. Tax creates a hierarchy, and the person at the top will claim to be logical. They will claim to be smarter. They will claim that they are the correct ruler. This is never true. The correct ruler is always abstract logic, never a person or thing.

'3. Not take the LORD's name in vain'

Tax is an insult to logic. If government can spend money better, it can prove it logically. If it cannot prove it logically the taking the money is a insult to logic. Tax is a mockery of logic. But withholding ground rent is also a mockery of logic. If land creates wealth regardless of who owns it then for a land owner to claim I made that money is an insult to logic.

'4. Remember the Sabbath day'

Tax makes people poor. It means they have to work longer hours, and do not have time to rest. If they still take the Sabbath off they cannot think and act rationally as they are trapped by poverty the rest of the week.

'5. Honour thy father and thy mother'

Tax makes people poor, so less able to care for parents.

'6. Thou shalt not kill'

Tax creates unaccountable hierarchies which encourages war. It creates poverty which kills. It removes trust in government which allows crime to soar. It allows land monopoly which lets the strong crush the weak.

'7. Thou shalt not commit adultery'

In the Old Testament God is symbolically called the bridegroom and Israel the bride. To pay tax to a mortal is symbolic adultery.

'8. Thou shalt not steal'

Tax is theft. So is withholding ground rent from the community.

'9. Thou shalt not bear false witness'

tax is based on the claim that governments have a right to the money.

'10. Thou shalt not covet'

Tax is where a government covets your property. This final commandment, that sums up the others, begins Thou shalt shall not covet thy neighbour's house. It applies particularly to land:

Freedom versus bondage

Moses never forgot the slavery in Israel. The whole point of his law was to never be slaves again. They were always reminded of the contrast with Egypt. So the Ten Commandments begin:

And all the laws are for freedom, contrasted with their bondage in Egypt:

They must have fairness in everything, not like in Egypt:

But the people wanted to go back, to trade freedom for easy food.

This conflict between freedom and security was there from the very start, when Eve first broke free of the gods, preferred freedom in the dry dusty land to servitude in the garden. And within two generations the people wanted to worship their old masters again (Genesis 4:26). This desire for freedom, then wanting to exchange freedom for the security of servitude, is a theme throughout the Old Testament. Centuries after Moses the people got their wish and became slaves to a king. That soon led to captivity in foreign nations. Then they remembered that slavery was not fun after all, but then it was too late.

The most equal nation in history

The basis of Israel's freedom, her organization as a nation, was equal shares of land. Land monopoly is the basis for inequality throughout history. The rich own the land, and the poor must pay them to live and to eat. But Moses' law made everyone equal.

Joshua divided the land proportionally among the different families (Joshua 13:7; 18:6; Numbers 26:53-56; 33:54). This was done by casting lots to determine the specific piece of land to be owned by each family head.

No elite

Originally Israel did not have kings, but judges were chosen from among the people. As for other leaders, the priests did not have fields, they were restricted to small towns (Num. 35:1-8), and they were to be fed by others (Ez. 44:28). There was no danger that rulers could grab land. This was probably unique in the history of the world.

Ahab (later in this part) is an example of a king who did exactly that.

No underclass

Just as here were no kings there was no underclass. Every family had an equal share of land. What about the criminal underclass? If you deliberately killed you made your choice. But if you killed somebody in a moment of passion or by mistake he let you run away.

No slaves

The Bible uses the word slaves but this is misleading (see part 3 of this book for details). These slaves had to be paid, treated well, and were effectively free to leave (see part 3 of this book for details).

Conclusion

So the land was shared equally. There were no kings, there were no elite land owners, and no underclass. They had what America, three thousand years later, could only pretend: that all men were created equal. America spoke of equality yet had racism and wealthy elites. The law of Moses did not just talk about equality, the law of Moses made it real.

Better democracy

The Greeks are often called the founders of democracy, but they also had great economic inequality. Without equality democracy is a sham. The rich always have the real power - sometimes even going to far as to buy the votes of the poor (as in the Roman system of patronage).

In contrast, the law of Moses ensures that everyone has roughly equal access to land, and there are no kings. This is true equality. Even if there is no formal vote each person has the same influence as anybody else, and no person can be intimidated because nobody can take your livelihood away (your land).

So the law of Moses had a superior form of democracy, and centuries before the Greeks.

Land was never to be sold

'Not be sold forever': Not be sold permanently. Land could be leased for money, temporarily in case of crisis, but it could be bought back at any time and anyway reverted back to the family that had been assigned the land (by Moses) every fiftieth year, the year of Jubilee (Leviticus 25:25-28).

Naturally people will try to get around this rule. One way is to marrying into another family, thus combining the land. To stop this, girls were prohibited from marrying outside their father's family (Numbers 36:6-9).

These were the simplest solutions to land monopoly in a late bronze age society where everybody farmed in the same way and people seldom married outside their village. But they are obviously sexist and economically inefficient once new farming techniques arrive. So Jesus offered a better method: ground rent. For economic efficiency, land should be shared according to who can create the most value from it; people keep the value they create and pay rent for the rest. See the commentary to Mark 12.

'Strangers and sojourners': This suggests we should act as if we are passing through. For so we are: the land will be here longer than any individual, and we all make use of value created by society, not ourselves: so to keep that value is theft, theft from society. We own whatever we add to the land, but we do not own what was there already.

Note that the Jubilee return of land did not apply to walled cities: otherwise the land owner would get unearned wealth due to the high value of that land (Leviticus 25:29-31). The law is based on logic, that one man should not profit more than another just because of luck.

Tithing was ground rent

Moses instituted a tithe, a charge of one tenth of the produce of land. Since everybody had an equal share of land, and farmed in much the same way, this was a direct measure of the value of the land. So tithing was a form of ground rent: a payment for unearned wealth from the land

Let us look at what Moses said about tithing. It's pretty simple: it's briefly introduced right at the end of Leviticus:

Note that tithing is only on crops, fruit and animals. Not of work.

How exactly did tithing work?

When we look at how tithing worked, things become a lot less clear. Tithing is mainly described in Leviticus 27, Numbers 18, and Deuteronomy 14. Numbers says that the Levites receive it all as pay for their services, but Deuteronomy refers to a tithing for feast days, with the people eating their own tithed crops. There are also references to the Levites having the first born of every animal plus various other animal sacrifices to eat.

Some see this as evidence that the text has been changed by later priests, eager to receive more pay (e.g. in the time of Josiah). Whatever the truth, vague rules soon become taxation by the back door. If there is anything we learn from Moses it is that taxation is bad, and God (logic) must always come first.

Now let us look at Moses' other economic laws.

No lending money for interest?

Moses forbade the lending of money for interest. (See Exodus 22:24-25, Leviticus 25:36-37, Deuteronomy 23:20-21, Ezekiel 18:17, Psalm 15:5.) This is often misunderstood, because we think of the need for interest to finance lending in a modern economy. but a late bronze age economy was different. Almost everybody lived hand to mouth, in constant fear of drought or other disaster. The only time they would borrow money was in a catastrophe, in order to survive. This is simply a command not to crush your neighbour when he hits bad luck.

A state does not need interest to grow. For example, instead of lending money for a house (and charging interest) a bank can buy the house outright and then sell part of it each month (at a profit) to the occupier. Islamic banking does this. The result is the same, but nobody is ever in debt.

Centuries later, as the economy developed, it became more useful for businesses to change interest. So Jesus changed the law: while the poor should forgive each others'; debts, the rich should definitely pay their debts, and should charge interest to other rich people (see commentary to Mark 11:25).

Land, tax and interest in a modern economy

In the days of Moses the economy was very simple, so most people were farmers and there was only basic trade. As trade increased there came a time when one farmer could create much more food due to his hard work. It then made sense to sell land to people who could use it better, rather than distribute it evenly.

So Jesus taught yes, sell land, charge interest, and make a profit, but everyone using land is expected to pay rent for it (see Mark chapter 12). Whereas ground rent is good, Jesus equated tax collecting with sin (Mark 2), and agreed that the poor should forgive debts (see the Lord's Prayer, forgive us our debts as we forgive our debtors ). For more about Jesus and his economic teachings see the commentary to the book of Mark, part 6 of this book.

Sabbaths and sabbatical years

Moses taught that every seven days and every seven years the land should rest. This allowed the land to recover, and it encouraged people to use the land more efficiently so they could stockpile food the previous day or year. The Sabbath year gave them time to build roads and walls as a group, and to plan ahead. This is not to say the people used the time for that, but it was a good rule.

Cancelling debts?

Another rule for Sabbath years was cancelling debts. As with lending for interest this was designed to protect the poor. It is economically inefficient to keep people too poor: they need enough money to buy enough food so they can always be healthy and work hard. They also need money for tools to work efficiently. So the poor must be protected. But for others there were simple ways around the cancelling of debts. As with interest, instead of debts a person could simply buy the thing the money was for and sell it back in parts. Also the law did not apply to strangers and the word "stranger" can be interpreted flexibly. Just involve a foreigner and long term debt becomes possible. Flexibility is the key.

Flexible interpretation

Moses showed by example that the laws were flexible. For example, he said thou shalt not kill and then commanded killing in time of war. True, his laws were very strict (the people needed strict discipline in the early years to survive in the desert) but he chose wise judges who could decide whether a law was really broken or not. For example, a son could be stoned to death for not showing respect to parents, but what counts as respect ? That's where wisdom comes in.

Jesus had made the need for flexibility very clear: Jesus picked food on the Sabbath for personal use, and noted that David ate the priests' bread when starving (see Mark 2:23-28). He summed the rules up thus: the Sabbath was made for man, not man for the Sabbath. If you needed to bend the rules on the Sabbath that was fine as long as the rules were not flagrantly broken.

At least, that's how the rules were supposed to work. Many centuries later, in the middle ages, the Israelites finally accepted the need for flexibility. They found ways to allow interest without breaking the law of Moses. They then became bankers and traders, and would have been wealthy. But by then it was too late: they had lost their land, for reasons that will become apparent.

Supernatural beliefs were poison

Moses' laws were flexible if people saw the logic behind them: the ban on interest was to protect the poor and did not have to slow down business. The Sabbath rules let the people rest, plan, and build roads. The strict rules could be flexible if people understood why the rules existed.

However, most people saw rewards as a supernatural result of obedience rather than a natural result of wise rules. So instead of making the rules work they made the rules stricter in irrational ways:

1. They thought that if banning some work on the Sabbath was good then banning all work was better.
2. They thought if banning interest was good then banning all kinds of profit from lending was better.
3. They thought if cancelling debts was good then there should be no debts of any kind past the Sabbath year, which crippled long term planning in the couple of years before the Sabbath.

The Pharisees were famous for this kind of blind observance and it angered Jesus. The idea that blessings come supernaturally is poison to an economy, It keeps people poor, and that causes suffering. The nation should have exploded in wealth, but instead merely grew modestly. Yet the laws were so good that, even though badly understood, the economy still grew, as we shall see.

Ancient Greece: it could have been Israel

The Israelites settled in Canaan around the time the Greeks developed their city states, and long before the golden age of Greek democracy (around 600 BC). They trade together via the Phoenician city states of Tyre and Sidon on the Canaanite coast. They shared a similar alphabet. The Israelite equal land laws should have made them more democratic than the Greeks. The absence of kings and tax, and the equal land rights meant nobody could skim off the economic surplus, so Israel should have grown more quickly economically. The belief in a God who is essentially logic personified should have encouraged the rise of science. In short, Israel should have developed democracy and science and trade and been stronger than the Greeks. But supernatural beliefs killed that dream.

The law caused economic growth

For four hundred years there were no kings and no taxes. All economic surplus stayed with those who created it, allowing them to invest. We should expect economic growth and an ever stronger nation, and that is what we see. At the start we have 20,000 people in a desert, fighting for survival. At the need we have a great nation of relative peace and prosperity.

As noted above, later kings rewrote the book of Judges to make this period seem like a period of war and chaos. But we can check what really happened by looking at the archaeological record. The period from entering Canaan to the first kings (roughly 1400 BC to 1000 BC) is known as the late bronze age to the early iron age. The change from bronze to iron is linked to the fall of the Hittite, Mycenaean and Egyptian empires between 1206 and 1150 BC: the Bronze Age Collapse. the empires around them were falling yet the Israelites grew stronger.

It is very difficult to measure economic growth from thousands of years ago. Scholars argue over a piece of pottery here or a piece of metal there, a grave here or a building project there. Much of the wealth was tied up in land and animals that leaves no permanent remains, and other wealth was taken in taxes and tributes, making it unclear where it came from: was it a sign of wealth being created or wealth being moved around?

The main evidence for economic growth in this period is as follows:

1. Settling of previously nomadic people.
   Setting almost always implies more opportunities for wealth.
    
2. Population growth.
   The nation filled with people in the bronze age and iron age. In these days of subsistence farmers and frequent famine, more people indicates more prosperity.
    
3. Increasing trade.
   "An escalation in interregional trade, as suggested by the material remains at Tel Masos, was another potential factor in the economic growth and eventual centralization of Israel" (Reconstructing the Society of Ancient Israel By Paula M. McNut)
4. Kings and palaces
    
   Eventually kings arose. Kings are a sign of economic surplus: as soon as a surplus exists, somebody will argue that they need to tax it in order to build themselves palaces and temples. Each king took more and more wealth until the third king, Solomon was famed abroad for his grand buildings and his navy. This implies great economic surplus.

Economic growth is an unavoidable conclusion. In the days of Moses, the nation was just isolated farmers. At the end it was a fully populated nation with enough economic surplus for Solomon to create great palaces and a navy.

Israel grows from strength to strength

In the period of the judges (1300s-1000s) external history shows the Habiru (Hebrews and allies) taking over the nation. Part of the Israelite success is their alliances, discussed in the previous part of the book. The Bible often refers to strangers in their midst, others who join forces. The El Armana letters (letters from Canaanite cities to Egypt) conform this: they complain of Habiru raiding cities and generally taking over, and beg Egypt to help. The Habiru are not just Israelites but many allies willing to support them.

This raises two questions.

1. Why were other groups so willing to join the Israelites?
2. Why couldn't Egypt stop them? Egypt was suppose to be protecting the land! Why was Egypt so weak?

The answer to both questions is tax:

Archaeological evidence of equality

The central feature of the old covenant was sharing the land: instead of land controlled by city elites it was controlled by thousands of families. So we see a move from a few cities to many more villages.

Archaeological evidence of peace

The traditional view is that two million Israelites marched in and wiped out the Canaanites. That was genocide. But as noted, that is not what the Bible says. The Bible indicates a far smaller number (about twenty thousand at first) and a gradual series of a few battles but mostly treaties.

The Israelites were once from Canaan (in the days of Joseph) and simply returned, taking four hundred years to fill the land. So we should not expect any dramatic change, except for the move to villages.

Elites envy the wealth

The economic success of the Israelites led to economic surplus, and that led to envy: elites wanted to be kings so they could use that surplus for palaces, rather than let the people reinvest it for further growth.

Five reasons are given for the eventual shift to a monarchy:

This was the obvious trigger, but why? The Canaanites had been a much bigger threat, when the Israelites were poor and few in number. That problem was solved by treaties. Now the Israelites are much more numerous and wealthier, in a better position to make deals, or if needed to build chariots.

The new threat was a very convenient excuse for the elites. They wanted the money, and making the people afraid is a good way to make them obey. But they needed to get past Moses law about not selling land. Ironically the success of Moses law gave them an opportunity:

Economic growth had pushed the land to the limit! The economy had grown so fast that it could grow no further! The only way to grow more is to use land more efficiently. New iron tools bring new opportunities: some people will find better ways to farm. So we need a way to let some people use more land without creating an elite. Jesus would have an answer: allow people to buy land, but charge rent that goes to the community. This has the same effect as the law of Moses: everyone benefits from the land, and nobody pays tax (all government income comes from unearned wealth, the value of land before any work is done).

The problem though was supernatural belief. The people thought the law of Moses was magic, as if blind belief brought blessings. They were unable to question it as Jesus did, unable to see why it worked and thus to find a way to upgrade it. So instead of replacing tithing with land rent they just broke the law of Moses: let the rich buy the land, and begin the spiral of inequality that weakens the economy.

And so we come to why the sea peoples were suddenly treated as a great threat.

This was not a problem as long as the wealth was spread out. If each farmer is wealthy but isolated on the farm he will naturally spend some of his wealth on swords and chariots. Imagine a nation of thousands of armed units spread across the hills. It becomes guerilla warfare of the hardest kind. To conquer you need to centralize wealth, so that single large push on a city becomes profitable. But centralized wealth is exactly what the elites were creating: So the sea peoples were a real threat to the elites.

So by concentrating wealth they created a danger of theft. By scaring people with stories of invasion they are able to take even more power, and thus wealth. Pretty soon the people had kings, an elite skimming off the wealth in taxes and forced labour, and economic efficiency was lost.

The disastrous role of tax in Egypt

Professor Michael Zank, of Boston University Department of Religion, suggests that tax policy may have played a key role in the rise of Israel:
(See bu.edu/mzank/Jerusalem/cp/LateBronzeAgeJlem.html)

1470-60: Pharaoh Thutmose III conquers much of the region and demands a heavy annual tax (tribute). We can imagine the Israelites, previously settled in the borders of Egypt, being required to do more and more public works, afflicted with more and more taxes, and so being enslaved by degrees.

1360-40: The taxes create tension between the local cities and nomads: the cities try to get money from the nomads to pay Egypt. More and more people join the Habiru rebellion.

1100s: The system of Canaanite city-states collapses: some are abandoned and others destroyed. Egypt, weakened by other factors (the Bronze Age Collapse) withdraws.

Why were the Canaanite cities so easy to defeat?

To say that tax created tension is putting it mildly. Tax (to pay to Pharaoh) turned people into serfs, so they had nothing to lose but to escape and join the Habiru.

This explains why the law of Moses was so suited for equality, and so hated the way of the Egyptians.

Summary

Archaeologists may debate the details, but the general picture is clear:

Circa 1400 BC: Egyptian tax hurts the people. The rise of outcast wanderers ( Habiru ).

Circa 1400-1000 BC: a move from cities to villages. A few small battles, but more equality and economic growth.

By 1000 BC: kings arise to skim off that wealth. They probably use fear of outside attack to gain power.

Scholars may disagree over details, but at the very minimum, "The historical records provide a valid outline - campaigns, disturbances, and heavy taxation resulting more probably in a general feeling of stress - but no more than an outline of this period. " (Burial Patterns and Cultural Diversity in Late Bronze Age Canaan By Rivka Gonen)

Now let us return to the Biblical chronology and see what went wrong:

Samuel warns: kings are economic poison

So what went wrong? Why didn't the progress continue? One word: kings.

Kings skim off economic surplus. They have an economic incentive to take as much as possible for their luxuries and friends. They also antagonize neighbours, while centralizing wealth, thus making your nation an attractive target for enemies. Finally, and perhaps most seriously, unlike with judges you can't just vote them out of they go bad. Kings are bad news all round. And to rub salt in the wound they control propaganda, so all you hear is how wonderful and necessary they are.

The prophets Samuel explains. There came a time when bad judges made the people unhappy. They started to imagine that a king would be better (as if a king would never be bad!) The prophet Samuel warns the people of their faulty logic: they think a tyrant will solve their problems, but it will in fact make their problems worse.

'They have rejected me': the people have rejected logic. Judges are intended simply to judge: their job is to follow logic, that is all. They may fail and need to be replace, but the goal is a good one. By rejecting judges in favour of tyrants the people reject logic.

The people give an illogical reason: they think that having a king will make them stronger.

The monarchists, the one who wanted to steal the land, claimed that a king would be strong, like Pharaoh. but Pharaoh kept his nation weak: he only appeared strong because he enslaved so many people, and all the other nations were monarchies and thus weak as well. When eventually a republic arose (Rome) it became more powerful than all the other nations and easily conquered Egypt. That republic could have been Israel if Israel had maintained its economic growth instead of letting a king cream it off. (Rome then repeated Israel's error, and had its own kings called emperors: it became progressively weaker until finally it was defeated by the Germans. And why were the Germans stronger? Because their laws forbade land monopoly, but that's another story.)

Finally we come to the other great controversy of the Old Testament: did Samuel order his men to kill women and children?

The Book of Judges: royal propaganda

After Joshua leads the people into the promised land we have the era of the judges.

This is the period when Israel came closest to the economic equality that Moses wanted (see part 5 of this book). It was the golden age of growing peace, growing strength and growing prosperity. It saw the Israelites grow from twenty thousand hungry and homeless people, in frequent conflict, to a nation of millions of settled farmers in perhaps the most equal society the world has ever known.

However, where there is wealth there is greed. Some people wanted to a king so they could cream off taxes and live in palaces. They grabbed power in the time honoured way, scaring the people with imagined dangers, and claiming that only a king could protect them.

Predictably the nation declined under the kings (see part 5 of this book). The kings then re-wrote history to make the judges period seem like a period of chaos. The book reads like a catalogue of wars, and often repeats the phrase 'in those days Israel had no king. ' We are supposed to look back on a time of anarchy and conflict, but look closer.

The book of Judges covers 400 years and only has twelve battles, most of them at the start when the people had only just arrived. How many nations can claim that record of peace? The main body, the middle section, records just six battles with neighbouring tribes. As noted before, the general policy was to make treaties. For example,

But the book is designed as royal propaganda, as we see at the end:

That sounds bad. But a careful reading shows the opposite is true:

In other words, there was progress in this period, from chaos at the start to peace at the end. But the editors of the book took the bad events from the beginning, put them at the end, and made it look like a period of decline!

The rot sets in

The first king, Saul, was modest, but each king grabbed more power than the last. Saul was followed by David, who taxed the people for building projects, but David was popular, a war hero and musician, so the people forgave him. Then the people got lucky: although David's son Solomon taxed them heavily, he was also very keen on trade, so the benefits of trade outweighed the losses from tax. But a wise king like Solomon is a rarity. His sons were different, and it was downhill from there.

The insidious rise of tax

Originally, there was only been one tithe. (Tobit 1:7-8 refers to just the one, collected annually.) Deuteronomy 14:22-27 adds a second tithe, but this is food that the worker's household is supposed to eat and share with neighbours at a festival, so the wealth stays in the local community

Exodus 30:13 added a half a shekel temple tax. It could be argued that this was merely a payment for something all the people used, so was a purchase and not a tax, but it was only one coin so nobody minded.

Once kings arrived they added more taxes, and more, and more.

1. Regular taxes for palaces and other luxuries.
2. Forced labour: a tax on time (that was no longer available for other work).
3. In times of war they demanded an emergency tribute.

By the time of Solomon the taxed were crushing the ordinary people. By the time of his son tax broke the nation in half.

How tax broke the nation

When Solomon died the people begged his successor, Rehoboam, to have mercy and not tax so heavily. Rehoboam said no, he would be even worse.

And so the land of Israel became two smaller kingdoms, Israel (the northern ten tribes) and Judea (the southern two including the capital Jerusalem).

After the nation split, Egypt noticed the concentrations of wealth and plundered the temple. They then went home: they could not easily control the people who were still spread out, but any concentration of wealth is just begging for an army to come and steal it.

Northern kingdom: unstable. Everyone wants to be king - the old story. Omri becomes king and makes friends with Phoenicia, a trader (good) but also a dictatorship based on the king owning land. Omri has his son, Ahab, marry the Phoenician princess Jezebel. Ahab and Naboth's vineyard = 100 years after the temple is dedicated. 900 to 800 BC, land rent becomes a mockery, then they fall to the Assyrians 721BC.

Tax leads to enslavement by other nations

Moses warned that sin would lead to foreign captivity:

This mainly happened through land inequality and taxation:

Tax weakens the nation

Tax slows down wealth creation. In Moses' plan the state was funded by a tithe on unearned bounty, a ground rent: all other work was tax free. But tax on work means some marginally profitable work is no longer profitable. So less work is done throughout the nation.

A weaker economy is less able to make deals, less able to build chariots, less able to survive hardship, less able to do anything it needs to do.

Tax weakens it further

The ability to tax anything is an invitation to waste. So kings spend money on palaces and other luxuries for their friends. So not only does tax reduce wealth creation, but the money taken away isn't even used efficiently. Year by year the nation is weaker than it should be. For a small nation that's fatal.

Tax makes you a risk to your neighbours

A nation of farmers is no threat to its neighbours. But a king has more incentive to attack. The Assyrian invasion happened because Assyria saw the risk that Israel might ally with Egypt and become aggressive, so Assyria attacked first.

Tax makes your nation an easy target

As long as the people were spread out then any invasion is too expensive. But kings concentrated all the wealth in one place, making a tempting target. A larger neighbour can move in and just grab the gold and leave (as Egypt did) or, by occupying just one capital city, control the entire nation (as Babylon later did).

The Assyrian invasion

The Assyrian invasion of 721 BC was not a major attack: for twenty years Assyria had been invading and looting as they pleased, and Israel was too weak to do anything about it.

The Babylonian captivity

Once again an attack happened in stages, because Israel was too weak to resist. Babylon could come and go as it pleased. In 597 BC, 587 BC and 582 BC. Babylon, tempted by the concentrations of gold, and just wandered in and took it. Israel was economically weak, and full of weak farmers who could not afford their own chariots or supplies to organize any real defence.

Exile in Babylon

Exile in Babylon, which involved the loss of Jerusalem and the destruction of the temple, was a wake up call. The prophets wished they had no princes to tax them:

They wished the land could be divided equally again:

But the far bigger problem was they rejected God. Even the later prophets rejected God: God is logic. But they rejected logic and embraced a supernatural view of God instead.

Taxation after the Babylonian captivity

The law of Moses does not allow taxation. But all of Judah's conquerors required taxation: that is why empires conquer smaller nations, to tax them. The tax collectors were:

• 597-582 BC: Babylon (conquest took several years)
• 539: Persia
• 330: Greece
• 140: independence under the Hasmoneans (Maccabees)
• 116: Greece again
• 63 BC: Rome

The priests loved taxes

We cannot argue that the priests opposed taxation: whenever they achieved any independence they embraced taxation with enthusiasm.

Under the Hasmoneans (the Maccabees) the Jews gained independence from Greece. but instead of returning to Moses;' law they had elite rulers and taxation as before. They taxed a little less per person, but made up for it by taxing more people.

So prosperity increased (consistent with lower per capita tax) but not enough to withstand the neighbouring empires. All that focused wealth in Jerusalem sent the message "come and conquer us".

Blind faith led to disaster

The Jewish leaders thought they could keep the law of Moses while rejecting what Moses said about tax. This confusion was inevitable: most people thought that God was supernatural. So their theology was not based on logic.

How Israel obeyed the Bible and rejected God

Todd Buchholz wrote the paper "Biblical Laws and the Economic Growth of Ancient Israel. " He showed how keeping the Biblical laws (blindly) made the economy weak. The tragedy is that, if the Israelites had understood the logic behind the laws (i.e. they put God first) they could have been the wealthiest nation on Earth. More than a thousand years later the Jews finally realised that financial services are compatible with the law of Moses, and they invented modern banking. But by then it was too late.

This is a classic case of blind faith: faith without understanding the reason, so missing the whole point. By not seeking a logical explanation for laws (i.e. not seeking God) we cause a great deal of suffering. But God is God: logic is logic, and sooner or later we have to face reality.

Blind faith 1: cash flow

Leviticus 19:13 says the labourer must be paid immediately. This is good economics: an employer cannot make excuses. Regular pay lets people plan ahead and make better decisions.

Problem: this might create cash flow problems.

A farm needs work today, but the fruit cannot sold for several months. According to Buchholz this was a problem in ancient Israel and held the economy back.

Solution: invent modern banking.
This is what the Jews did in medieval Europe. Modern banking lets you pay the labourer right now (thus fulfilling the law) but do so in shares, or promises of more: that is, in paper money that represents later gold. This paper money can be sold right now for cash, because the buyer knows the paper will be worth more later. Problem solved.

The invention of banking

People had lent goods (and later money) since prehistoric times but the medieval Jews did something different. Prejudice means they were not allowed to own land, and were kept out of many jobs, and would sometimes be driven out of the country. Somehow they needed a way to make money that was portable. The Jews could usually read (so they could read the Bible) so that made them more intellectual than the average peasant. So they used their God-given brains: they found a way to make money without needing land or tools. They invented banking!

The law of Moses said you have to pay people immediately, and by medieval times the world saw why this was essential to economic growth. On the small scale you can make some peasant wait a few weeks to be paid, he has no choice. But you cannot fund large scale international trade that way. You cannot say "build me a ship! Then I will sail away and maybe never come back, and if I do come back I will pay you for the ship. " That will never work. You need a way to pay the ship builder right now using money you will not have for months or years. So the Jewish bankers invented paper promises of future payment, guaranteed by deposits, law, and their reputation.

Putting God back into the Bible

The law of Moses said pay them now. Instead the ancient Jews said we cannot pay, we have no money and did not pay at all. But the medieval Jews were forced to ask how can we pay now if we have no money? That was the right question. The answer revolutionized the world. They finally put God (logic) into the Bible.

The reaction to pay them immediately is like the reaction to Jesus saying render unto Caesar the things that are Caesars. Most people see two choices: do what everyone else does (pay taxes on work) or avoid it completely (because Caesar owns nothing: God owns it all). Both are economically illogical. Taxing work means less work is profitable, and not paying at all means Rome will destroy you. but if we believe in God (logic) we must ask why the command is logical? How can this be economically superior to both? Then we ask the right question: ignoring all supernatural claims, what did Caesar actually produce? Rewarding a person for what they produce is the basis of economic growth. What does he produce? is the right question.

Blind faith 2: unproductive land

The second problem that Buchholz identifies is the Sabbath: nothing was to be grown on the land one year in seven.

Problem: less productivity.

If people simply sit around feeling holy every seventh year, while other nations are busy producing, your nation will fall behind.

Solution: use that time intelligently

The solution of course is to do something more productive. How can a year off farming make you more productive? By forcing you to never be complacent: you have to find ways to grow more the previous year. by forcing you to stand back and think: time to think is the most valuable time of all. You can find even better ways to make wealth, experiment with other trades (which of course are all tax free: what an incentive!). And because everyone does it at once you have all these farmers available for massive infrastructure projects like building roads and aqueducts.

Centuries later the Roman empire would stand above its barbarian neighbours because of its massive roads, sewers and aqueducts. Its people were well fed and watered, so whatever they did they could do faster. They were the wonder of the world.

Italy at this time (around 1000 BC) was no much different from Canaan. Israel could have been the economic centre of the world, not Rome. Sabbath years were their chance to escape from the endless cycle of subsistence farming. But instead they saw the Sabbath as something supernatural, as if the nation would be stronger simply because it worked less! That goes against logic: it goes against God.

Blind faith 3: capital investment

The third problem that Buchholz identifies is the big one:

Problem: no lending for interest

The ban on lending for interest led Israelites to lend less. But lending is a big part of being hmes and developing new businesses. So this weakened the Israelite economy.

Solution: what we now call Islamic banking.

First, let us see why interest was banned:

Poor farmers only borrowed money in a crisis: some unexpected accident. Then their neighbours would help out. Their neighbours did it for payment: not in cash, but in insurance: the knowledge that next time it might be them needing the handout.

The law against interest was simply a law against crushing your friend if he had bad luck. Note that interest was perfectly find if it involved a stranger:

There is nothing in this law that prevents people buying houses or investing in business. Modern Islamic banking also forbids interest. So the bank simply buys the house (instead of paying for it) and then sells it to you brick by brick while you live in it. The result is the same, you get a house, but if you lose your job and cannot pay you simply walk away. There will be penalties of course, but the penalties do not continue to grow with interest if you cannot pay them. They do not crush you.

Protection for the poor is essential for a healthy economy. if somebody is crushed financially then they cannot make good long term decisions, so less wealth is created. Meanwhile, if businesses can make money by trapping the poor in spiral of debt then they will do so, instead of creating something useful to society.

If the Israelites had followed the logic of the law - that it is designed to strengthen the economy - they would have built more houses and businesses than other nations, because everybody, including the poorest, was in a healthy position to plan ahead. But instead they produced fewer houses and businesses because of the irrational belief that God wanted them to not lend money.

Ironically, making money from financial services was seen as stealing. But it was the opposite: it was giving people opportunities. By not engaging in financial services they stole their children's future.

Blind faith 4: not dealing with strangers

The fourth problem that Buchholz identifies is related to the third:

Problem: debts should be cancelled every seventh year

If all debts are worthless every seventh year then nobody will lend money in the years before. This could damage the economy in most years and make long term projects impossible.

Solution: involve a foreigner!

This law applies to your neighbour or your brother and not to foreigners. So it effectively encourages business ventures of any size to include outsiders. This encourages business links with non-Israelites, making war less likely. It also encourages the spread of ideas.

Of course, in practice instead of looking for ways to make life better (by doing more business) most people imagined a supernatural god who would make the nation wealthy through not doing business. It didn't happen.

Blind faith 5: economies of scale

The final problem comes back to the central problem of trusting in text instead of God.

Problem: land does not go to its most efficient use.

For reasons of fairness, Moses gave every family a roughly equal share of land. Every fifty years any land sales were to be reversed so that nobody could ever monopolize land. But this means land was not given to the most efficient users. Others nations allowed land to be bought by more efficient users, thus creating more wealth.

Solution: listen to God

God is logic. In the days of Moses his rule was logical. Equal shares of land was th simplest way to ensure fairness. That was the bronze age when all land was farmed in much the same way. But as the centuries passed that was no longer true. Logic then requires a more sophisticated solution.

If people have an equal claim to land, it follows that anybody who uses land should pay rent to the community for its use. Tithing is just ground rent. Once we understand that then it is a simple matter to update the law of Moses. Let other people use land as long as they pay the rent. If one person makes an unfair profit then charge him more rent.

It's not a difficult concept. It's simple logic (see AnswersAnswers.com for a more detailed look at the logic). Jesus understood the law of Moses and came to the same conclusion: land should go to the best user, and everybody using land should pay rent,

The Bible: God's economic tool box

In conclusion, the law of Moses is like God's tool box. It is a set of tools to be used according to logic (God).

Ground rent, immediate payment, good banking, etc., are like a hammer, a saw, or a work bench. They must be used logically: hold the hammer at the correct end, apply the saw to the wood, rest items on the bench. Logic is king. But blind faith is the enemy of the tool box. If you use a hammer blindly you are liable to hit your thumb.

Don't trip over the work bench. Don't cut your fingers off. Don't use them blindly. Similarly, don't be so enthusiastic that you hammer and saw everything in sight, thinking that will have a better result. Use the tools intelligently, with restraint and flexibility, understanding their use, and replace the tools when they wear out, and your work will be magnificent.

After the Old Testament: Roman conquest

After seeing how the Israelites ignored and misused God's tools, the fact is that they are still God's tools. Even used just a little but they can have pleasing results. After the shock of captivity the people did try a little but harder. They were still paying tax to the Persian rulers, and then to Greek rulers, but many did try to keep the law, at last as far as they understood it.

For a history of the land laws in Israel, and the extent to which they were kept, see The Other Law of Moses by John L. Kelly

When the Romans invaded they found a beautiful, prosperous land. In the north were upper and lower Galilee:

In the south were Samaria and Judea:

The Romans saw the wealth and they wanted it. So they installed a ruler called Herod.

In this world, in the prosperous northern lands of Galilee, lived Jesus. He saw what was wrong and he knew how to fix it.

Enter Jesus, the embodiment of logic

God is logic. Jesus of Nazareth was called "logic made flesh". He was uniquely placed to understand logic. This is why:

• Jesus was wealthy and educated (though he renounced his wealth).
  Jesus appealed most to the rich, he used their language. He was clearly well educated - he had the title "rabbi" and other rabbis debated him as an equal. There is evidence that his family had houses both in Nazareth and Capernaum. All the evidence points to Jesus being like every other great religious leader: born into a comfortable life, renounced wealth, but appealed to the middle classes. We remember his followers as poor simply because he condemned riches, and back then all but a tiny fraction were poor. But statistically, that tiny fraction was ten times over-represented among the Christians. For details, see "Early Christianity: Opiate of the Privileged?" by Rodney Stark.
   
• He was closer to reality than we are.
  To some extent the modern world shelters us from reality. We can afford to make mistakes and not die. We are surrounded by complex systems that we do not understand. But ancient times you could see cause and effect, life and death, more directly. You saw the connection between land, food, and survival. Prejudice and violence were out in the open. Social groups were smaller. Human nature has not changed much since then, but back then it was easier to understand.
   
• He lived where the greatest ideas in history all met
  First century Galilee put Jesus in a unique position. He understood Moses' economic laws. He saw the wealth of Galilee and the great trading cities of Tyre and Sidon: he understood commerce. He probably spoke Greek, coming just after the golden age of the Greek philosophers. His Jewish learning included the best of Egypt (via the Ptolemies) and Assyria (via the captivity around 600 BC).
   
• He saw the birth of global society
  Jesus was born around AD 1. Just after Julius Caesar turned the Roman republic into an empire. Jesus lived at the time of the blessed Augustus, the greatest of all Caesars. Jesus saw how Rome grew: what worked and what did not.
   
• He had reason to deeply question everything
  Matthew and Luke record Jesus as having royal blood and a miraculous birth. Those parts are not in the earliest gospel, Mark. They are clearly irrational (Occam's razor doees not allow a star hovering over a stable or choirs floating in the sky), but they seem to have been added in response to the widespread belief that Jesus was the illegitimate son of Panthera, a Roman soldier. If so then Jesus had reason to think very carefully about Rome, and also to see the hypocrisy of society wanting to kill his mother for being the victim of a crime. It's enough to make a man thinking very deeply.
   
• He was highly intelligent.
  Part six of this book shows how Jesus taught through logic. If he had lived in Greece he would have been called a philosopher, not a teacher (rabbi). His teachings on the nature of consciousness (see part two of this book) and on the economy (part six) were two thousand years ahead of his time.
   
• Possibly the most intelligent man who ever lived.
  How do you measure intelligence? By the use of logic? Jesus certainly passes there. By social or emotional intelligence? His many followers show that he shone in that department. Or by your ability to influence the world? Jesus is the most influential person who ever lived. By being ahead of your time? This book argues that Jesus' economic teachings are more advanced than anything normally taught in universities. By any measure of intelligence, Jesus is either at the top or off the scale.

Regarding Jesus' influence, many people argue that the modern church owes more to Paul. But there is no evidence for this. Paul did not create many converts either (see part eight of this book). Certainly the later church reflects Paul's views, but with just his views the church would have been another Osiris or Mithra cult. But something made this new church different: and what every convert points to is Jesus Christ.

Something about Jesus' his life and teachings made this church stand out from the others. It is true that he Christian church has little to do with what Jesus taught, and thought he was supernatural. But that is just because he was so far ahead of his time. There was something in those gospels that said "there is something special here."

A summary of Jesus' teachings

Jesus summed up his teachings as two commandments (Mark 12:28-31):

1. Love God (that is, love logic: see below)
2. Love your neighbour.

This implies the two other great teachings that stand out:


3. Love your enemies (Matthew 5:43-48).
4. Build the kingdom of God (i.e. a kingdom of logic) (Mark 1:14-15).

Loving enemies is implied by loving logic. We need to cooperate to survive, and they have similar needs and thoughts to us. It is also loving neighbours: enemies are generally neighbours. If they were not we could just ignore them.

Building the kingdom of God is implied by loving logic because we should apply logic to all we do. It is also implied by loving neighbours because the biggest impact on our neighbours is the economic system.

Jesus' teachings are the same as Moses' teachings, but with an emphasis for the more modern world: more emphasis on flexibility, more emphasis on dealing with people who are not part of your tribe. But it is the same message. Logic is logic and does not change.

Part six: the gospel of Jesus Christ