AN ECONOMIC COMMENTARY
by Gary North, Ph.D.
No.58: Social Overhead Capital: Legal Education
And these words, which I command thee this day, shall be in thine heart: And thou shalt teach them diligently unto thy children, and shalt talk of them when thou sittest in thine house, and when thou walkest by the way, and when thou liest down, and when thou risest up (Deut. 6:6-7).
Education is the responsibility of the family unit. "Train up a child in the way he should go: and when he is old he will not depart from it" (Prov. 22:6). There is a lawful pathway in life, and parents are required by God to impart the details of this law-order to their children. These guidelines are provided by biblical law: "Thy word have I hid in mine heart, that I might not sin against thee" (Ps. 119:11). Of crucial social significance, then, is the requirement that parents transfer the data of biblical law to their children.
Comprehensive biblical instruction involves an enormous outlay of human capital. Time is each man's only truly irreplaceable resource, and men are told to use up large quantities of time in instructing their children. Sitting in their houses, walking in the roadways, they are to use their time to pass on the heritage of biblical law. Throughout the day, instruction is to intersperse household activities. This forces parents to review the law, either by reading or memorizing large portions of it by hearing it recited. Children are to grow up in an atmosphere totally permeated with biblical law.
When we consider the time and instructional effort which each family is to devote to this educational task, multiplied. throughout all the households of a nation, the magnitude of the capital investment becomes more apparent. The modern economist who specializes in the study of economic growth will often speak of the necessity of social overhead capital in the development of a nation's economy. Social overhead capital includes such items as court systems, roads, canals, dams, and educational institutions. Unquestionably, the most crucial and most expensive is education. An investment here provides the highest economic return per unit of capital invested. Most economists assume that the civil government is responsible for the creation of social overhead capital, and especially educational capital. Without this investment, the argument runs, there will not be a proper framework for successful private capital investment. The economy will not develop.
The Bible places the responsibility for investing into legal and moral "programs" squarely on the family. The primary form of capital is moral and legal capital, the Bible affirms, and being absolutely basic to the survival and prosperity of a society, the Bible assigns this training to families. The family, as the central human institution, must fulfill the central tasks. The Bible decentralizes this task, precisely because the investment requirements are so huge, involving so much time and effort, that no single centralized institution could afford the expense or achieve the goals effectively. Households have the incentive and the resources to build up this form of capital. It is an intensely personal form of capital, and no bureaucratic, publicly supported institution is competent to replace the family unit as the training ground of moral and legal dominion. Other institutions are merely adjuncts to the family in this area-specialized organizations hired by families to assist them in their educational responsibilities.
There is no question that society in general benefits from such an investment. A thorough familiarity with biblical law and the blessings and curses attached to it helps to reduce the costs of law enforcement and social welfare costs in general. Personal self-discipline replaces the need for expensive, less efficient policing by public agencies. The tax burden of all citizens can be reduced as a direct result of the investment in moral education. Insurance costs against theft, vandalism, arson, assault, and other acts of wilfull rebellion will also be reduced. The courts will be unclogged in proportion to the increase of household education. Capital that would have flowed into law enforcement, and therefore into the coffers of the civil government, can now be invested into business or used in personal consumption. The existence of household education therefore helps to reduce the influence of the civil government, keeping it in its proper sphere. The neglect of household education inevitably expands the jurisdiction of the State.
In the field of economic development, nothing is more crucial than the attitudinal and moral outlook of the population -- not technical training, not foreign investment, not government-to-government foreign aid projects, not raw materials. The failure of the overwhelming majority of governmental foreign aid programs, as well as programs created by domestic governments, has been the result of basic attitudinal and moral deficiencies of the particular populations in question. This has been made clear in the writings of the British economist, P. T. Bauer, especially in his important book, Dissent on Development (Harvard University Press, 1972), yet his conclusion has been almost universally ignored by government policy makers, professional economists, and employees of the major international organizations concerned with economic development.
James Coleman and others involved in his important 1966 report discovered that the attitude of the family was more important than the per capita investment of resources in the American public school system with respect to student performance. Next in importance was peer group attitudes and pressure. Again, the lesson is clear: the family, and only the family, is competent to instill in children the basic requirements of productive living. The family is absolutely central to personalized education and economic development in general.
The attempt of secular humanists to transfer this family responsibility to the public school system has to be understood as a direct challenge to the godly social order. It must be understood as a subversive activity designed to replace biblical law with humanistic law. The end result is a rise in criminal behavior, a decline in educational performance, and the ultimate erosion of economic progress. Primary education is to be familistic, decentralized, and law-oriented. Anything other than this is socially suicidal, for it reduces society's investment in the most important aspect of social overhead capital: universal training in biblical law.
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