Skip to main content
Listen to Acton content on the go by downloading the Radio Free Acton podcast! Listen Now

R&L: Historically, what has been the influence of Judaism on the development of capitalism?

Sacks: It is important to distinguish between Judaism as a faith and Jews as a people. Both have had an impact on the development of capitalism, in different ways. Judaism did so through its emphasis on work as virtue, made as a necessity, and private property as a precondition of individual liberty. Judaism did not share either the aristocratic disdain for work found in classical Greece or the occasional tendency to other-worldliness found in early Christianity. It saw this-worldly prosperity as a sign of God's blessing, and work as man's “partnership with God in the work of creation.”

Jews, throughout the Middle Ages, were often barred from owning land or entering the professions. As a result, many of them were forced into trade and finance, partly because of the Christian prohibition against taking interest. The result was that Jews became pioneers in banking and finance, as well as in international trade. The cultural impact of Jewish values on the market economy of the West is discussed in David Landes's fascinating study, The Wealth and Poverty of Nations.

R&L: To your way of thinking, what are the affinities between the ethical and theological precepts of Judaism and the structures of the free-market economy?

Sacks: Judaism as a religious vision emphasizes the integrity, freedom, and independence of the individual, as well as his or her responsibilities to society. Individual property rights were therefore as important to the Hebrew Bible as they later were to John Locke. One of the great biblical dramas is Elijah's challenge to King Ahab, who seizes Naboth's vineyard (1 Kings 21). Kings did not have the right to appropriate private property. The prophet Micah dreamed of a day in which “every man will sit under his own vine and under his own fig tree and none will make him afraid” (Mic. 4:4). A world of limited government and respect for private property, in which individuals are self-supporting through their own labor, is a world of maximal freedom and human dignity. Judaism's strong provisions for tzedakah (a word meaning both charity and righteousness) are designed not only to alleviate poverty but also, and primarily, to restore independence. Hence, in Jewish law, the highest form of charity is to find someone a job so that he or she no longer needs to depend on charity.

R&L: You have argued that “socialism is not the only enemy of the market economy. Another enemy, all the more powerful for its recent global triumph, is the market economy itself.” What do you mean by this?

Sacks: A sustainable market economy depends on certain values that are not created by the market—among them, trust, integrity, honesty to customers, loyalty to employees, industry, reliability, and so on. Other values, no less important in the long run, are strong families, a passion for education, and a sense of responsibility to the community. The market encourages competition, but this needs to be balanced by habits of cooperation. As many writers have pointed out—among them, Joseph Schumpeter, Daniel Bell, and George Soros—in itself, the market tends to erode those values necessary to its own survival. The market is part, but not the whole, of a free society.

R&L: What kind of society do you think gives rise to and is able to sustain a free-market economy?

Sacks: A free-market economy tends to be created where there is a strong respect for the individual, a positive value attached to work, and a willingness to value and reward creativity and innovation. It tends not to arise in social systems that are highly collectivist, aristocratic, or conservative.

R&L: You have argued that, to thrive, morality needs to be anchored by tradition and, further, that the free market tends to destabilize traditional societies. Since the free market needs a moral foundation to remain humane, how can we avoid the free market destroying the very thing it needs to survive?

Sacks: Almost every human civilization has had its periods of growth, maturity, and decline. The free market (and its political counterpart, liberal democracy) may be no exception. The single greatest innovation in Judaism was the Sabbath—one day in seven when the market was closed; there was no work; a limit was set on economic striving. This created a psychological and sociological balance within Jewish life, which saved it from collective burnout. That may be why Judaism—the faith of a tiny and often powerless people—survived, while the great empires did not.

R&L: I would like for us to explore some of the important ways in which rabbinical thought has contributed to moral reflection on commercial culture. What do you see as some of the rabbis' crucial insights on what we today would call business ethics?

Sacks: A vast Jewish literature exists on business ethics, a subject of reflection for over three thousand years. It begins in the Mosaic books with such provisions as the fair and decent treatment of employees, honest weights and measures, and the periodic remission of debts to avoid the creation of a permanent underclass. It continues through the prophetic literature with Amos's and Isaiah's great denunciations of dishonesty and exploitation. These principles were developed in the rabbinic literature, which lays down detailed principles of fair trading, employee rights, honest advertising, unfair competition, and so on. A good summary is found in Meir Tamari's book, With All Your Possessions: Jewish Ethics and Economic Life.

R&L: Consumerism has become an important topic in contemporary debate. What is rabbinical thought's understanding of and solution for the moral peril of wealth?

Sacks: In Judaism, wealth is seen as both a blessing and as a responsibility. The wealthy are expected to share their blessings with others and to be personal role models of social and communal responsibility: Richesse oblige. To a considerable extent, that is what happened in most Jewish communities at most times, and it is what saved Jews from the decadence associated with affluence. In Judaism, there is a difference between ownership and possession. What we have, we do not own; rather, we hold it as God's trustees. One of the conditions of that trust is that we share what we possess with those in need. Wealth creation goes hand in hand with the alleviation of poverty—just as, in biblical times, landowners were expected to share part of their harvest with the poor. Jewish teaching is best summarized in the famous aphorism of Hillel: “If I am not for myself, who will be? But if I am only for myself, what am I?” Judaism is personal responsibility allied with social responsibility.

R&L: Similarly, what are the rabbis' teachings on poverty and its alleviation?

Sacks: Poverty, for the rabbis, was a curse, with no saving graces. Poverty does not ennoble; it demeans. Therefore, the poor must be helped to escape from their poverty—through education, training, the creation of employment opportunities, and help in starting their own businesses.

R&L: Is there a distinctive Judaic understanding of stewardship? What does that look like?

Sacks: Stewardship in Judaism means that we are guardians of the world for the sake of future generations. We must not do irreparable environmental damage. We must create civic amenities. We must ensure that every child has the best possible education. We must provide our own children with the vocational training to become self-sufficient, and so on. An ancient rabbinic tradition teaches that, at the dawn of human history, God said to humankind, “See the beauty of the universe which I have created—and all that I created, I made for you. Be careful, therefore, that you do not harm what I have made, for if you do, there will be no one left to restore what you have destroyed.”

R&L: It has been said that more than the Jews having kept the Sabbath, the Sabbath has kept the Jews. How does the Judaic vision of Sabbath-keeping contribute to how one ought to view commercial activity in the free-market economy?

Sacks: I had a friend who—well into his seventies—used to go for twenty or thirty mile walks. “What,” I asked him, “is the secret of endurance?”

“Rest,” he used to say, “five minutes in every hour.”

Rest is the secret of survival, and the Sabbath is its greatest civilizational embodiment. The ancient Greeks did not understand the Sabbath. They thought that Jews ceased work one day in seven because they were lazy. They were quite wrong. The Sabbath is “re-creation”: time dedicated to all those things that sustain a market economy but are endangered by it—family, community, celebration, prayer, study, and reflection. In a society that honors the Sabbath, people become the masters, not the slaves, of work. A society without a Sabbath is one in which we can be too busy making a living to have time to live. The first great principle of time management is to distinguish between the urgent and the important. The Sabbath is time dedicated to the things that are important but not urgent—spending time with one's spouse and children, sharing a meal, enjoying what we have instead of thinking what we do not have, and giving thanks to God for his blessings in the company of those with whom we share a faith.

Human freedom is expressed as much in the ability to stop as in the ability to work. The Sabbath is the great counterbalance that protects the market from self-destruction and ensures that wealth creation remains a means and not an end in itself.