Inflation has vaulted to “economic enemy number one” in the last two years. The consumer price index has increased 7.1 percent in the previous 12 months, far above the Federal Reserve’s 2 percent target. Families and churches are feeling the pinch.

The traditional approach to fighting inflation is to raise interest rates. The Federal Reserve has increased interest rates by 4.25 percent. Higher rates make borrowing more costly, and debt-financed purchases become more expensive. Yet, inflation remains elevated.

Could it be time for a new approach? Should the next opening in the Federal Reserve be filled by an expert in spiritual formation rather than finance? Could a hard look at how we live and spend be more successful than regularly raising rates by 0.75 percent?

Could it be time for a new approach? Should the next opening in the Federal Reserve be filled by an expert in spiritual formation rather than finance? Could a hard look at how we live and spend be more successful than regularly raising rates by 0.75 percent?

Whether at the personal or government level, our response to crisis often follows a three-stage process:

1. Manage the immediate risk   2. Tweak a part of our lives   3. Get back to “normal”

The challenges come when managing the risks sows the seeds for the next challenge, or when the desire to get back to normal causes us to miss the opportunity to discern what changes would make the most difference.

The pandemic response followed the three steps very closely. Interest rates were lowered, evictions curtailed, unemployment benefits enhanced, and payments delivered. In stage two, many Americans reassessed the importance they placed on work. Some left the labor force, and others stepped back on their working hours. For many, this was a helpful step. Americans often put too much emphasis on work. We went back to buying more things in stage three because we received extra money.

The pull to get back to “normal” caused many to maintain or increase high consumption levels and feed the continued desire for more. The net effect was higher inflation and a missed opportunity to reflect on how we live our lives.

The inflation we are currently experiencing was sown partly by the government providing more support than was helpful. The stream of direct payments and enhanced unemployment benefits helped people in need while creating incentives to step away from work. Many Americans reduce their work hours by retiring or cutting back on second jobs. The pull to get back to “normal” caused many to maintain or increase high consumption levels and feed the continued desire for more. The net effect was higher inflation and a missed opportunity to reflect on how we live our lives.

Deeply examining our daily practices will likely lead us to a deeper life and a stronger relationship with Christ.

Deeply examining our daily practices will likely lead us to a deeper life and a stronger relationship with Christ. Many Christians are taking a hard look at their practices and developing a “Rule of Life,” which is defined by Practicing the Way[i] as  “… a schedule and set of practices and relational rhythms that help create space in our busy world for us to be with Jesus, become like Jesus, and do what He did – to live “to the full.” Others use the term “spiritual disciplines” to mean something similar.”

Practices such as the Sabbath, worship, and prayer help us connect more deeply with God and allow a fuller evaluation of what matters. As a bonus, they are strongly disinflationary. Setting aside a day of rest, worshiping the God that provides, and engaging in a divine conversation requires far fewer resources than online shopping, scrolling influencers’ feeds for what to buy next, and remodeling the next room in the house. But many of us spend much more time and resources on the second set of activities. As Dallas Willard notes, “Our mistake is to think that following Jesus consists in loving our enemies, going the “second mile,” turning the other cheek, suffering patiently and hopefully – while living the rest of our lives just as everyone else does.”[ii]

The Federal Reserve isn’t likely to distribute copies of A.W. Tozer’s The Pursuit of God or Willard’s The Spirit of the Disciplines. The Practicing the Way podcasts aren’t expected to be mentioned in Jerome Powell’s subsequent press conference. Pete Scazerro isn’t going to be nominated as a Federal Reserve governor. However,  we can take a hard look at our lives and make sure our money, time, and energy aren’t being used to pay more for something that was never satisfying in the first place.

 

Scott Kubie, CFA
President

[i] Rule of Life Workbook — Practicing The Way (practicingthewayarchives.org)
[ii] The Spirit of the Disciplines: Understanding How God Changes Lives, Willard, Dallas, 1990, page 5.