Hong Kong was always different than other colonies. It began in 1842 as a minor trading post, surrounded by empty territory. Like the United States, most of Hong Kong’s citizens were drawn there for freedom and opportunity. As Milton Friedman noted, after WWII Britain allowed Hong Kong to pursue a classical liberal, free market policy. Even during its own dalliance with socialism, Britain allowed capital to move freely in Hong Kong. Taxes were kept low and there were no exchange or trade restrictions. The results were spectacular. Despite absorbing millions of impoverished refugees, Hong Kong’s per capita income rose from about a quarter of Britain’s to more than a third larger in just four decades.

In 1984 Margaret Thatcher’s UK signed an agreement with China that promised to continue Hong Kong’s unique role for another 50 years. Post-colonial Hong Kong became a free city inside China, with its own laws, democratic legislature and independent judiciary. It kept its free market economy, its low rate tax system, and its separate, convertible currency. China traded a negligible dilution of its sovereignty for the enormous benefits it derives from a free Hong Kong. It calls this arrangement "One Country, Two Systems."

With billions of people still trapped in poverty today, why shouldn’t we build new Hong Kongs? Why shouldn’t other developing countries and regions have vibrant outposts of freedom like Hong Kong?

The United States should create a Free Cities Program that would build treaty-based "Hong Kongs" in countries that genuinely want democracy, prosperity and a way to outflank corruption. These new Cities would be joint ventures between the United States, an international financial institution like the World Bank, and the host governments. The U.S. would negotiate 50-year bilateral treaties with the host countries, authorizing the joint venture to purchase undeveloped plots the size of Hong Kong, establish property registries, and institute a complete set of Western freedoms and responsibilities.

Treaty-based Free Cities would offer democracy, low taxes, rule of law, limited government, reliable prosecution of corruption, freedom of faith, speech and press, multiethnic meritocracy, and free trade. They would exemplify free market globalization, rather than the economic exploitation of protectionist colonial mercantilism. Like Hong Kong, these tiny places would become safe havens for investors and entrepreneurs. They’d allow citizens to raise capital, attract the skills they need from abroad, and create thousands of new jobs where there are none today.

This strategy would be inexpensive, yet philosophically revolutionary. In a Free City development wouldn’t be a problem at all. Investors and workers will absolutely flock to places where there is freedom, secure property rights and the rule of law—thereby reversing the brain drain that hobbles every developing country.

The joint venture would only have to build the Free Cities’ public infrastructure, and that would be financed by resale of City land, City taxes and bonds. The global private sector would gladly develop everything else because they’d be able to reap the rewards of their own enterprise.

The people attracted to Free Cities would become stakeholders who would resist aggressively any interference with their freedoms, as the citizens of Hong Kong have. And the host country’s ruling elite would learn quickly, as China’s did, that they can earn much more from their Free City than they’d ever be able to pocket from foreign aid or "squeeze."

This strategy could change the focus of America’s official development programs from government-to-government to people-to-people. Free Cities would mobilize the private sector, NGOs and the faith community, to build first world economies in destitute places. In the process, it could stimulate a profound new American engagement with the poor of the world.

A Free Cities program would appeal powerfully to the idealism and generosity of the American people—and to the friends of freedom around the world. It would put the U.S. on the offensive in the worldwide war of ideas. And it would put dictators, kleptocrats, and terrorists on the defensive.

The world needs at least a dozen new Hong Kongs. The United States should lead the way and begin building Free Cities in Eastern Europe, Africa, Latin America, and Asia in the next five years.

Ken Hagerty is Chairman and Founder of the Global Venture Investors Foundation; Theodore Roosevelt Malloch is Chairman and Founder of the Spiritual Enterprise Institute

The modern market economy has, with some notable exceptions, from the time of Rousseau and Marx down to the present been largely defined by its ignorant adversaries. They see only the bad and attribute every conceivable evil to it. The defenders of the market economy in the discipline of economics often see only a soulless process in which it no longer makes sense to raise questions about right and wrong. Curiously, the first great and positive account of the modern market economy given by Adam Smith comprehended the larger cultural context within which markets operate. What Theodore Malloch gives us in Spiritual Enterprise is a sustained account of the role of faith in the leadership and operation of a successful business and the necessity of spiritual capital for a healthy market. He writes in the tradition of Max Weber, Michael Novak, Wilhelm Röpke, and Deidre McCloskey.

Expanding Putnam’s concept of social capital, Malloch defines spiritual capital as “the fund of beliefs, examples and commitments that are transmitted from generation to generation through a religious tradition, and which attach people to the transcendent source of human happiness.” (pp. 11-12). Malloch maintains that it is not possible to understand the economic success of the market economy without understanding the religious and moral culture which undergirds it. He would dismiss the claims of Daniel Bell in the “Cultural contradictions of Capitalism” that a market economy undermines its own original moral tradition. He offers in rebuttal a host of detailed examples from prominent business leaders of the important role that a religiously inspired ethics has played in their whole life as well as in their business. Without denying that professed non-believers can lead moral lives and business, he questions whether this can be sustained over generations. He forces us to raise the question of whether we are now living on borrowed and diminishing spiritual capital.

In our overly rational age we suffer from an intellectual hubris which refuses to recognize that there is a pre-conceptual domain (practice) that cannot be conceptualized (theory). There is a mystery at the heart of the universe that moderns refuse to countenance. This hubris has ethical implications. If practice could be conceptualized then the relationship between theory and practice can itself be explained in theoretical terms. If one could give a theoretical account of the relationship between theory and practice, then such an account would dictate what practice should be. At the heart of this hubris is the epistemological claim that once the correct theory is in place then the practical consequences or the ethical implications are entailed. Whatever qualifications are introduced, the adherents of this view believe that rules can be understood to apply themselves. This hubris is reflected in many business ethics courses in business schools, courses which are based on the claim that you can teach someone to be ethical. This hubris has had a devastating effect on ethical practice. It transforms morality into an intellectual exercise, the application of theory to practice or morality as the reflective observance of rules or ideals. Emphasis is put upon having a correct and defensible theory rather than on how to act. The ideals too quickly turn into obsessions. Inevitably moral sensibility is inhibited or even eroded in favor of an elaborate casuistry. The object seems to be to observe a rule instead of behaving in a certain concrete manner. It achieves the appearance of stability at the price of imperviousness to change. When change can no longer be resisted it occurs as a revolution rather than as an evolution.

What Malloch offers as an antidote are the traditional virtues. The moral life, then, is “not a matter of what you do but of what you are”; the task of the moralist is to “describe the virtues that we should emulate and teach our children” (p. 18). Malloch first focuses on the three theological virtues of faith, hope, and charity. His examples taken from the lives of real business leaders can only be described as inspiring. The specific virtues germane to business practice, what he calls the hard virtues, are leadership, courage, patience, perseverance, and discipline. Rather than bracketing off the hard virtues, Malloch then connects them to the soft and social virtues of justice, compassion, forgiveness, gratitude, and humility. This is not a laundry list or historical curiosity; rather it is a coherent and integrated account of how some religious traditions give transcendent meaning to the creation of wealth, how that wealth is not an end in itself but becomes the resources for human accomplishment, and how that achievement translates into socially responsible action.

Lawrence Kudlow urges that Malloch’s book should be read by every CEO. I could not agree more. Perhaps more than any other figure, the entrepreneur is the embodiment of the classical virtues. He is his own boss. His successes and failures are his own. He eats what he kills. He gains or loses in proportion to his ability to serve the wants and needs of those who trade with him voluntarily. In the free, capitalist economy, the entrepreneur is the motive force. The practical significance of entrepreneurship is abundantly evident. Every place of business, from the humblest storefront to the gleaming corporate campus, is testament to the existence of an entrepreneur and his vision. Despite his significance in practice, however, the entrepreneur is diminished or dismissed entirely in theory. Acknowledgement of the entrepreneur’s contribution to our civilization lags significantly among those whom Robert Nozick termed wordsmith intellectuals. We are awash in academic, journalistic, and cultural cues that deny or ignore the value of entrepreneurial activity

For roughly the middle five decades of the 20th century, the entrepreneur largely disappeared from mainstream intellectual inquiry in the discipline that should be most sensitive to the effects of his activity: economics. In the regnant neoclassical paradigm, his activities are assumed out of existence in the model of the perfectly competitive market that serves as a touchstone for much of the field’s thought. But the marginalization of the entrepreneur is most notable not in the realm of theoretical economics, but rather in that portion of the academy ostensibly devoted to practical instruction in the ways of commerce—the modern business school. Since at least the early 1960s, academic business education has viewed the entrepreneur mainly as the anachronistic forerunner to the technocratic, scientifically-trained, corporate manager. Where entrepreneurship does appear in the business curriculum, it is at the margin. Courses devoted to entrepreneurship are almost invariably elective and virtually never part of the core curriculum. It is as if entrepreneurship were a deviant form of business practice, alien to the typical, mainstream business-doing to which the core curriculum is putatively devoted. Further from the academy, public intellectuals of the middle 20th century, like John Kenneth Galbraith, filled their books and columns with tales of the entrepreneur’s virtual extinction and irrelevance in a coming economy dominated by large, state-like corporate behemoths. In popular culture, the entrepreneur suffers much the same fate as the corporate entities that are supposed to displace him. With rare exceptions, literature and film find the entrepreneur interesting (if at all) only in his capacity for predation.

What is the future of Spiritual Capital in America? Is American spiritual capital being eroded? We believe there is a natural progression from governmental bureaucratic centralization to secularism to materialism to a social-collectivist conception of human welfare. We assert that the welfare state undermines institutions (e.g., family and religion) that promote spiritual capital; militant secularism as a quasi-religion promotes a reductive conception of human nature, one that denies freedom and responsibility. We already see the results full blown in the impoverishment and implosion of the Communist empire and we are seeing the gradual evisceration of spiritual capital in Western Europe. It is time to retrieve, restate, and revitalize America’s spiritual capital. Malloch’s book is the best place to start this renewal. For not since Adam Smith himself have we witnessed so forceful a treatment on the linkage between the economy and moral reasoning.

Nicholas Capaldi
Legendre-Soulé Distinguished Chair in Business Ethics &
Director of the National Center for Business Ethics
College of Business Administration
Loyola University New Orleans
6363 St. Charles Avenue
Campus Box 15
New Orleans, LA 70118
(225) 772-6523
nick.capaldi@gmail.com
capaldi@loyno.edu
www.cba.loyno.edu/faculty/Capaldi

Hong Kong was always different than other colonies. It began in 1842 as a minor trading post, surrounded by empty territory. Like the United States, most of Hong Kong’s citizens were drawn there for freedom and opportunity. As Milton Friedman noted, after WWII Britain allowed Hong Kong to pursue a classical liberal, free market policy. Even during its own dalliance with socialism, Britain allowed capital to move freely in Hong Kong. Taxes were kept low and there were no exchange or trade restrictions. The results were spectacular. Despite absorbing millions of impoverished refugees, Hong Kong’s per capita income rose from about a quarter of Britain’s to more than a third larger in just four decades.

In 1984 Margaret Thatcher’s UK signed an agreement with China that promised to continue Hong Kong’s unique role for another 50 years. Post-colonial Hong Kong became a free city inside China, with its own laws, democratic legislature and independent judiciary. It kept its free market economy, its low rate tax system, and its separate, convertible currency. China traded a negligible dilution of its sovereignty for the enormous benefits it derives from a free Hong Kong. It calls this arrangement “One Country, Two Systems.”

With billions of people still trapped in poverty, it’s time to build new Hong Kongs. The best solution for millions of illegal entrants rushing to the U.S. is to offer them hope and opportunity in their own countries.

The United States should create a Free Cities Program that would build treaty-based “Hong Kongs” in countries that genuinely want democracy, prosperity and a way to outflank corruption. These new Cities would be joint ventures between the United States, an international financial institution like the World Bank, and the host governments. The U.S. would negotiate 50-year bilateral treaties with the host countries, authorizing the joint venture to purchase undeveloped plots the size of Hong Kong, establish property registries, and institute a complete set of Western freedoms and responsibilities.

Treaty-based Free Cities would offer democracy, low taxes, rule of law, limited government, reliable prosecution of corruption, freedom of faith, speech and press, multiethnic meritocracy, and free trade. They would exemplify free market globalization, rather than the economic exploitation of protectionist colonial mercantilism. Like Hong Kong, these tiny places would become safe havens for investors and entrepreneurs. They’d allow citizens to raise capital, attract the skills they need from abroad, and create thousands of new jobs where there are none today.

This strategy would be inexpensive, yet philosophically revolutionary. In a Free City development wouldn’t be a problem at all. Investors and workers will absolutely flock to places where there is freedom, secure property rights and the rule of law- -thereby reversing the capital flight and worker exodus that hobbles every developing country.

The joint venture would only have to build the Free Cities’ public infrastructure, and that would be financed by resale of City land, City taxes and bonds. The global private sector would gladly develop everything else because they’d be able to reap the rewards of their own enterprise.

The people attracted to Free Cities would become stakeholders who would resist aggressively any interference with their freedoms, as the citizens of Hong Kong have. And the host country’s ruling elite would learn quickly, as China’s did, that they can earn much more in their Free City than they’d ever be able to pocket from foreign aid or “squeeze.”

This strategy could change the focus of America’s foreign aid programs from government-to-government to people-to-people. Free Cities would mobilize the private sector, NGOs and the faith community, to build first world economies in destitute places. In the process, it could stimulate a profound new American engagement with the poor of the world.

A Free Cities program would appeal powerfully to the idealism and generosity of the American people—and to the friends of freedom around the world. It would put the U.S. on the offensive in the worldwide war of ideas. And it would put dictators, kleptocrats, and terrorists on the defensive.

The world needs at least a dozen new Hong Kongs. The United States should lead the way and begin building Free Cities in Latin America, Eastern Europe, Africa, and Asia in the next five years. The real answer to illegal immigration is to share the freedom and opportunity we enjoy in America with people around the world.

Ken Hagerty is President and Founder of the Global Venture Investors Foundation;
Theodore Roosevelt Malloch is Chairman and Founder of the Spiritual Enterprise Institute

Recently, the Spiritual Enterprise Institute inaugurated an annual Gallup Poll on the “Spiritual State of the Union” to examine the role of both individual and corporate spiritual commitment in American life. Although survey respondents provided their own definitions to “spirituality,” the working definition is deemed to be “sensitivity or attachment to religious values and things of the spirit rather than worldly or material interests.”

One of the most noteworthy projects undertaken by the Institute, the “Spiritual State of the Union” received a great deal of national attention when it was released last month, and reveals much about spiritual life in America today. Here are some of the most cogent Headline-catching findings:

Economic health is related to spiritual health.

Ethical issues were found most important to 50-64 aged group who attend church. Many so-called hot issues like gun laws, technology, overpopulation, education, don’t register very much or at all. Of non-economic issues, fuel oil prices are more important than anything else across all groups.

Regionally: people in the South care more about ethical/moral issues; in the East about terrorism; the Mid-West, Iraq; and far West, education.

Republicans care much more about moral decline, while Democrats care about poor leadership. Liberals are twice as unhappy about the general economy as Conservatives

Those whose faith shapes success and the spiritually committed are much more concerned about ethical/moral issues. The richer you are the better you think the economy is doing. The US economic system –capitalism- -is viewed as “basically OK.”

Our economy depends on the spiritual health of the nation.

The resounding answer is “a great deal!” – except for non-church goers.

In the South support is overwhelming for such a statement and a majority of activists and poor people believed this even more than the rich. In fact, many people have come to think that work makes the world a better place. The only disagreement is in our youngest workers who are more cynical.

Work is of value to the world.

Christians and the spiritually committed are most likely to completely agree. The poorer you are the more you agree that work is important. College graduates completely agree; the same as church goers. Republicans agree more so than Democrats but Independents agree the highest. Those in the East and West are most likely to disagree showing the existence of a coastal bias.

More than half of all Americans think being ethical will pay off economically.

85% mostly agree, across the nation. The highest totals for agreement were: satisfied workers, spiritually committed, faith-based, activists and entrepreneurs. Most people still think breaking the rules is a no-no and a significant population thinks that people are always ethical.

Open expressions of religion in the workplace are encouraged or tolerated by 79% of Americans.

People are equally split on prayer and religion at work, but the trend appears to be growing as a practice.

The Protestant work ethic is still alive and well.

Hard work may offer some guarantee of ultimate success according to half of those polled, however when asked whether the strength of the US is based on business: 77% agree; 82% of Republicans vs. 71 % of Democrats.

Government regulation does more harm than good: 60 % argue.

Success in life is determined by spiritual forces: 58% agree. Government however is no longer viewed as the savior or even first agent for change and betterment.

Belief in God remains high.

82% believe in Him; but increasingly many see themselves as spiritual not necessarily religious. When asked: Does God want us to find work that suits our talents, 87% agree. Asked Does God want us to be useful to the world, 91% agree. Asked if faith equals purpose in life, 69% agreed. The least likely to agree: young, males with college degrees who infrequently go to church and have high incomes.

People with a purpose are satisfied in their work and believe their faith shapes success.

When asked are you spiritually committed: just under 65% said yes. Faith encourages development of God-given talents 65% vs. 87% of religious.

Political divisions may run deep in America but the spiritual health of the nation is viewed as critically important.

When asked: Are you happy with whom you are: 88% said basically yes. College graduates and church-goers were the happiest at 92%. 63% of all Americans found the spiritual health of the country to be very important.

People can no longer be trusted.

59% said you can’t be too careful. Trust is out the window! Distrust is highest in 18-34 age groups and in frequent church goers. 69% of the poorest income people lack any trust. Who has hope? Women who attend church and are satisfied in their jobs.

Americans are very generous people.

65% of Americans volunteer a great deal or some of the time vs 89% for the spiritually committed. There is such a thing as spiritual capital. Where do people volunteer? Church 85%; Charity 53%, School 37%. How many Dollars a year do they actually give? $100 18%; $500 30%; $1000 17%; $5000 22%.

In his executive summary of the poll, George Gallop suggests that the survey marks rapid shifts in American attitudes as well as confirmation of the critical underpinning of religious and spiritual beliefs as they relate to managing current problems, the economy and work; volunteerism and the giving of money; meaning and purpose in life; and one’s outlook to the future.

My one, personal take-away from the research is close to the mission of SEI and is good news: The 18th Century concept of a Protestant work ethic has not only survived the 20th century waves of communism, fascism, socialism, secularism, and the welfare state, but may be positioned for a resurgence.

What is China becoming? How exactly is it advancing? How are religion and spirituality now viewed in a country with a communist government and a capitalist economy? President Hu has held a number of summits over the past few years with Western leaders. They have been meetings of significant proportion, ripe with historic opportunity.

There is potentially a win-win plan that appears to be emerging, all sides willing. Arguably, nothing is more critical to the project of the 21st century than Western-Sino relations. China is now woven into the global, interdependent economy. How can formerly tense relations be so improved? Is it possible to build a new dynamic that would give both sides a boost, improve economic conditions, allow more freedoms, stabilize political relations and effect the future of the world for good? Will China step up to the task, away from the Orientalist trappings of the past and its ensnarled bureaucracies and outdated ideology?

China boasts one of the longest single unified civilizations in the world. Its 5000 year history is characterized by dramatic shifts in power between rival factions, periods of peace and prosperity when foreign ideas were assimilated and absorbed, the disintegration of empire through corruption and political subterfuge, and the cyclical rise of ambitious leaders to found each new empire. But for the last three hundred years China has more or less been asleep. The error and mistake of Mao’s disaster are all too evident today. But the sleeping dragon empire is now reemerging in a vibrant dynasty. China is attempting changes on a scale never before achieved and at break-neck speed. A new ‘harmonious’ society is the objective and today nearly everything is in a constant state called: transition.

Twenty-five years after Deng Xiaoping’s reform and opening policy allowed the West back into China, the country remains as mysterious and undiscovered as it was in the 19th century when gunboat diplomacy forced the last tottering dynasty to open up the country to trade and exploration. China’s vast population has grown from 400 million to over 1.3 billion in less than a century. This has driven a boom in consumerism most evident in the cities where advertising abounds and an entrepreneurial and materialistic China is literally, bubbling up.

There are four gigantic transformations happening in China, simultaneously. No country has ever in all of human history been involved in such dramatic change. But in this case, given China’s size, power and integration into the global economy, the risks and rewards involve the entire planet.

The four transformations or transitions are:

The West would be well prepared to comprehend and ponder each of these concurrent transformations in attempting to understand modern China.

The emerging China, surely involves combating rampant corruption, enforcement of intellectual property laws, assistance by way of expertise on reforms, an open admission that Maoism is both wrong and dead (a museum to this effect, is in the making), and realization that consumers increasingly come first in China’s emerging “harmonious society.”

This is not to suggest that there are no problems in or with China or that it magically can assume an instant superpower status; becomes our keen rival or eventual enemy. It is simply time to recognize the facts and seize the day. There are many hard questions we will ask, some of which include:

The Executive Committee of the China: In Transition project includes:

Donegality Productions LLC is a media company that develops books, films, and other cultural projects that promote human flourishing and the common good. Donegality Productions will oversee the project in partnership with Wheelhouse Productions and distribute the film and curriculum through Thomas Nelson, the leading Christian publisher.

The director, screenwriter and producer of the documentary is Randall Wallace, President of Wheelhouse Productions and producer and author of the award-winning feature film, Braveheart and many other hits, including PBS documentaries and a series for The History Channel.

The budget for the film is $2.5 million, which incorporates both a traditional and viral marketing strategy with a global audience in mind.

Outline

The following is a concept outline of the documentary. There may be slight changes in settings and locations as the script is developed and completed. But these are the four themes that are explored and illustrated in the film. Each theme will be examined by a dramatic narrative story designed to reach both an elite/intelligent and a younger generation of emerging viewers curious about China.

Outreach

The aim of this project is to reach emerging influentials both in the United States and abroad. Prior to the release of the film and companion book, we will be host town hall meetings in leading places across the United States on the thesis.

Development DVD Budget

Book and Bible

A companion book, China: In Transition, to the movie in popular style, written by the lead group but drafted by an award-winning journalist, will accompany the film documentary. The book will be aimed at a broad market with best-seller status and with deep praise expected. It will have incredible endorsements from renowned leaders.

Along side the film documentary and companion book is a new translation of the Chinese Bible. The 1909 version now in use is being redone and updated and will be ready for publication in about a years time. We have access to the Chinese translation team of scholars doing that Bible. We have had high-level discussions in China with the proper officials that suggest if we co-produced with a leading university we could co-publish it and sell it in bookstores and churches throughout all of China and of course in Asia through normal channels.

The combination of the best, thoughtful documentary on China, a companion book, and this new Bible make for a powerful group or ‘bundle’ of products that can be marketed and sold together and/or alone.

To be honest, there are only two commencements I even faintly remember; my own, in 1974, where Senator Mark Hatfield gave a confession or actually lamentation about being between a rock and a hard place in the political culture of Washington, DC; and, some 25 years later in 2002 when my oldest son, graduated from Yale. Governor Pataki of New York, whose son Teddy was in the class, offered a moving ten minute charge on courage after 9/11!

Last year at Stanford University, Apple Computer, CEO, Steve Jobs gave a short graduation address that become instantly famous and circulated widely on the internet. He told three deeply personal stories and concluded: You need to connect the dots, by staying young and staying foolish. I recommend his hip speech to you but do not think its recommendations nearly sage enough.

In a similar vein, I have three stories for you this morning but first and foremost, I want to congratulate YOU, the graduates, on a job well done. Equally important, we all should say a loud and pronounced THANK YOU to your parents, grandparents, friends and families who have provided and prayed for you in this attainment. Max Dupree, the wise, Christian CEO of the Fortune 500 furniture company, Herman Miller, who was also a college and seminary president I should add, in his book, Leadership Jazz, said: ‘Pointing the way and saying thank you is the first and last word of true leadership.” Remember that good advice. Being nice, polite and grateful is no more difficult than the opposite. In fact, doing so pays large rewards. God told us to have a joyful heart: how do you get one? It starts with praise and thanksgiving, goes through forgiveness and leads directly to servant leadership: cause and effect.

Here are my three short stories for your guidance. The first one took place in Europe nearly five hundred years ago; it involved our ancestors in the Protestant Reformation. Both Luther and Calvin used the word vocation or calling from Berufung in German with reference to someone calling or addressing one, vocally. The one who called was the living God. Their view was different than the prevailing medieval sense of a restricted calling of a person to leave their work and enter a monastic way of life or holy office. The Reformers held that Christ’s crucifixion and resurrection from the dead was a total victory that included the salvation of both life and nature. Natural work was already sanctified, made holy, and did not require prior or additional sanctification dispensed by a church or through sacraments. Since then, everywhere human beings stand and live Coram Deo, directly before the face of the living God who summons them to serve Him and their neighbors by doing what they do: as farmers, craftsmen, kings, housewives or merchants. Daily work itself became a vocation; it needed no further spiritual dimension.

Tie this to the doctrine of the sovereignty of God. It is critical for understanding of role of the Christian –you graduates — in the world. The question I put to you is this: does this sovereignty relate to soteriology as well as your individual salvation? Or has God’s sovereignty been slowly shoved to the margins and effectively privatized? If linked to creation it has wide implication. The biblical phrase, "Christ is Lord of All" means more than lordship of narrow individual behavior or for one hour on Sunday morning in a church pew. The phrase has a cultural mandate also impelling action in society and in the economy. The possibilities are manifold, all with an option to serve God or to bend to another manmade idol. Faithful stewardship is careful administration of what has been entrusted to you by someone else who is higher than yourself. In Aristotle the "oeconomia" which translates as stewardship did not have to do with some separate category of ethics that can or cannot be related to real life decisions. It had to do with the whole character of the actor. We have removed this normative element.

The question of this story of old for you gathered here is simply: what is your calling? Listen … even now for the quiet voice of Him who made and sustains you. And then pick up your nets and have the courage to follow Him wherever it takes you. If you need encouragement I suggest you read N.T. Wright’s new book, Simply Christian. He supplies a focused view of the meaning of Easter:” When Jesus emerged from the tomb, justice, spirituality, relationship and beauty rose with him. Something happened in and through Jesus, as a result of which the world is a different place, a place where heaven and earth have been joined forever. God’s future has arrived in the present.”

While you may think you have finished your education today or that you now posses a terminal degree, I have to tell you that nothing could be further from the truth. You see the global economy that we compete in and the very nature of free enterprise and competition mean that you all will have to become what I call, “perpetual learners”. Because the minute you stop learning, you die. I do not want to leave you with an impression that this is just mad activity, memorizing more facts or cramming for more tests as cogs caught up in the hustle and bustle of modern life as we know it. Josef Pieper once wrote an elegant work that suggested that leisure is nothing less than “an attitude of mind and a condition of the soul that fosters a capacity to perceive the reality of the world. “He demonstrated that leisure has been, and always will be, the first foundation of any culture and he observed,” in our bourgeois Western world total labor has too often vanquished leisure. Unless you regain the art of silence and insight, the ability for non-activity, unless you substitute true leisure for our hectic amusements, we will destroy our culture, its collected wisdom – and ourselves.” So graduates, continue to set time apart for thinking, for praying and for re-creation. Be perpetual learners!

My second story began a number of years ago on a beautiful and balmy, tranquil spring day as we flew into the Bahamas and went through the gates of the private Lyford Cay Club. My heart raced as I was about to encounter the world’s greatest investor for the first time. I was not there, as so many before me had trekked, to gain some useful perspective on the market or to discover which global companies to invest in. My conversation was even more profound. Over time, I was privileged to have many conversations with him and to embark on a friendship that turned into a challenge.

Sir John Templeton was a humble, yet penetrating soul. His gaze was truly like that of a sage, of a person both entirely other-worldly and so infused with spiritual information that he exuded, well—joy. He enjoined me in a direct yet simple challenge: to demonstrate how enterprises and the entrepreneurs who started them are guided by a spiritual force rooted in faith. I took up his challenge and with his generous support and my own endowment, founded the Spiritual Enterprise Institute.

What challenges you? What do you want to be remembered for when all is said and done? Do not fall prey to the temptations of material life, of work as toil or living without a purpose. Make yours a purpose-driven life. Make a difference not just for yourself but for a Kingdom that lasts for eternity. It may not make you popular, rich or famous—that was never promised. As C.S. Lewis put it in his tale of Narnia, captured now in film, “He doesn’t like being tied down—of course he has other countries to attend to. It’s quite all right. He often drops in. Only you mustn’t press him. He’s wild, you know. Aslan is not like a tame lion.” Aided by that wise and magnificent lion, the children lead Narnia into a spectacular climactic battle to be free of the wicked witch’s glacial powers forever!

You have achieved a personal milepost today but, my friends rarely do you achieve results entirely from your own effort. You, like I, will or have been blessed in this life with loving parents, a helpful spouse, many friends, wonderful children and a community of persons, a network of colleagues and supporters, a free country, the list goes on and on — all who have both believed and invested in you. For this, be eternally grateful and fully acknowledge that no person is an island nor are they formed of their own being. We are works in progress and God has designed meaning in it all. He is working those purposes out throughout the ages, even here and now. Be willing to play your part in His story.

Neither is a life entirely one’s own product. Rather it is shaped by the tides of the times and one’s own background, experiences, and mentors. Having been reared in an observant home and raised in the cradle of Reformed faith, I was never outside of belief. My intellectual pedigree, interdisciplinary training and a life of real world work led me to undertake the tasks I have been given. As an academic, who early on became a “recovering academic”, I was perhaps fortunate to leave the ivory tower to join the blood, sweat and tears of the active life. Wherever I have been involved, in politics, investment banking then diplomacy, and for nearly the last two decades as a strategist in the corporate world, I have tried, often failed, and tried again, to be a Christian. From Davos to Aspen I have had the good fortune to interact with and to come to know senior business people, keen on inventing the future. I have come to know them and their companies, intimately and to advise them while peering into their souls. What have you been challenged to do? When they read your obituary sixty or seventy years hence: what will your lasting contribution be?

My final act; I grew up singing old and new hymns. The songs I most recall, include the likes of Hide it under a Bushel, No, Jesus Loves Me, and Deep and Wide. For me, faith was and remains the ultimate purpose for living and serving. Each summer my family would travel from the heat and humidity of the inner city to vacation at a camp in the Adirondack Mountains, on what is literally, Lake Pleasant. The image still reverberates in my over-educated mind especially on sleepless nights. It was as cool, calm and refreshing a place as is a heavenly breeze. That is because it likely was. It was a religiously inspired but nondenominational setting. They called us gospel volunteers—as if we were free and roving ambassadors for Christ. I guess I still am. I recall my last summer there, then as a counselor. Every Sunday morning at chapel, set high on a hill overlooking that ever pleasant lake, we would march in carrying about a hundred different flags. They were from nearly every country around the globe — from America to Zimbabwe. As they paraded forward to the stage the orchestra would play and the ebullient choir would sing in the loudest and most melodious voices I have ever heard, Crown Him with Many Crowns… Thy praise and glory shall not fail for all eternity.

My prayer for you as graduates today is that you too will have your Lake Pleasant, as a reservoir of strength; and that you will remember this special place of higher education, the character and friendships formed here, so that you can give all the Glory to God. Because in the end, life is a calling, and taking on your challenge is a nothing more than a long doxology; from Him all blessings flow and to Him they shall return.

Hold on! We need to answer these charges head on with the bold idea that the creation of wealth by virtuous means is the most important thing we can do for ourselves and for others.

The downfalls of WorldCom, Enron, Adelphia, Tyco, and other once high-flying companies like Bear Stearns have flooded newspapers, television screens and courtrooms around the country with important, and often difficult, questions about the ethics of business – or the consequences of their troubling absence. From inventors to investors, venture capitalists to investment bankers, and employees to managers, people inside America’s businesses are all too aware of the need for better corporate governance, for more accountability and transparency.

But from what sources do the virtues that inform such good behavior arise? And why are they so essential to the modern economy we have come to depend on for our creative freedom and our prosperity? Many people have real anxiety about virtue – particularly as it pertains to business – because it is a concept that is increasingly absent from our public vocabulary. Today, the general public holds corporate CEOs in lower esteem than at any time in history, ranking them below lawyers and politicians. Because of the crimes and scandals perpetuated by some company officials, people are rightly disillusioned, even disgusted, by what they glimpse of corporate America’s goals and the nefarious means with which it seeks to achieve them.

Perhaps, profit-only companies are, in fact, parasitic, and they damage the economy at large with their limited and self-focused view of their role in the marketplace. But companies that commit themselves to a more holistic core mission and are steeped in spiritual capital rooted in virtue, succeed not only in righting wrongs but in creating genuine personal and social progress, while also succeeding in generating strong profits. The moral outrage that people feel in response to the past decade of scandal and the past year of deceit is indeed entirely legitimate, and it leads to compelling questions about the true purpose of business and the virtues that are necessary to sustain it and a free economy.

It is characteristic of the age in which we live to see the moral life as a matter of following rules or dictated principles, often enforced by regulations and enforced by faceless bureaucrats. Ancients seldom referred to such rules or principles and there were no bureaucrats. For them the moral life was not a matter of what you do but of what you are. The fundamental notion was not duty but virtue. And the task of the leader was to describe the virtues that we should emulate and teach to our children and peers.

We achieve the condition of happiness and respectability only through the practice and discipline of the virtues. We teach our children to be courageous, wise, just and temperate because we know that this will make them respected by their fellows, secure in their decisions, and able to take full responsibility for their lives. Success in business is similar. Success is not an accident or matter of luck. The crooks usually, in time get caught. We prepare for business success by acquiring virtues—dispositions that help us to take risks, to make decisions, to take responsibilities for our actions, and to accept wise advise and correction. These virtues are the most important part of our human capital. We do not invent them for ourselves. Instead they grow organically over time, through history, tradition and experience. Everyone knows that the best and lasting companies breed virtuous corporate cultures.

The three theological virtues (faith, hope, and charity) and the hard virtues (leadership, courage, patience, perseverance, and discipline) need to be combined with the soft virtues (forgiveness, gratitude, and humility). Only by returning to the question of ethical norms—things which people must possess before they go to market to compete can we regain our way and have some sense again of a moral compass. These are the indispensable supports, which preserve both the market and competition from degeneration.

Business is the real test of the moral life, and those who engage in it are putting themselves in a position where trust in goodness, whether from God or nature’s laws, is the surest guarantee of success. The immediate result is the shaping of the human character, which in turn transforms culture—national as well as corporate. Vices lose their attraction and virtues become easier as spiritual discipline exerts its hold over the human personality.

Business is all about the creation of wealth and that requires capital investment. I believe the most essential part of that investment is the spiritual capital with which enterprise begins, then flowers and bears fruit – talents creating and sustaining still more talents, and all of us thriving in a vital bond.

It is time to renew our spiritual capital by living the virtues in the business sphere and in specific enterprises. For only in so doing will companies realize an incomparable source of the certainties that they will need in order to succeed in the highly competitive and interconnected international commerce that we have come to experience. In so doing we will be able to sort out the good from the bad and to foster freedom and responsibility.

Theodore Roosevelt Malloch, is the author of Spiritual Enterprise: Doing Virtuous Business, recently published by Encounter Books, 2008. Hearst Media Syndicate.

“Malloch’s injection of the virtue of thrift in today’s public dialogue will challenge us to renovate our economic house, repair our appetites and help us search for what is of real value. Somehow, this forgotten virtue has me humbled at its simplicity and enthusiastic about the power of an historic idea poised to live again. This is the wise work of one of our true public intellectuals.”

— MICHAEL VAN PELT,President, Cardus/Work Research Foundation

Despite the calls for massive spending and “stimulus,” if the current financial crisis has taught us anything it is that it is imperative to save, not just spend bailouts. In fact, over the years thrift has become America’s lost or forgotten virtue, rarely mentioned and never celebrated, despite its true historical significance. In Thrift, Theodore Roosevelt Malloch looks at the history of thrift from its roots in the Scottish enlightenment to the no-waste credo of Sam Walton. Thrift, Malloch argues, provides the resources to ultimately stimulate prosperity. Even if the government manages to shock our economy back to life, Americans will require discipline, accountability and farsightedness — all natural products of thrift — to right its course for generations to come. In an age when corruption and ineptitude have crowded out thrift, Malloch’s important book is lively, topical, and immediately useful.

Theodore Roosevelt Malloch is chairman and CEO of the Roosevelt Group. He headed consulting at Wharton-Chase Econometrics and has worked in capital markets at Salomon Brothers. Dr. Malloch has held positions at the United Nations and has served in senior policy positions in the U.S. Senate Committee on Foreign Relations and in the U.S. Department of State. He is a research professor at Yale University and at the Drucker School of Management at Claremont.

Photo Credits:
Author Photo by Julie Right, Abbey of London
Cover Art © Mike Kemp/ Rubberball Productions/ Getty Images
Cover Design by Tamaye Perry

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Theodore Roosevelt Malloch answers these charges head-on. In Spiritual Enterprise, he explores the opportunity of doing virtuous business – a concept that has been disappearing from our public consciousness. Malloch argues that the creation of wealth by virtuous means is the most important thing we can do for ourselves and for the world at large. But more than simply explain why free enterprise makes the world a better place, Malloch documents how virtuous business models have made many of the brightest companies in America more successful than ever.

Spiritual Enterprise rehabilitates the idea of big business as a force for good in society and offers a sensible guide for realizing this ideal. As antiglobalization and anticorporate tides are rising, Malloch’s books is both a much-needed defense of free enterprise and a vital call for better business.

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Steve Forbes, Chairman and CEO, Forbes, Inc. and Editor-in- Chief, Forbes magazine

Rockefeller himself believed that thrift was essential to well-ordered living. This book, if followed, could help all of us put our personal and public lives back in order.

Jim Stanley, Co-Chairman, VII, Inc.

According to the ever-wise Dr. Samuel Johnson, “Frugality may be termed the daughter of Prudence, the sister of Temperance, and the parent of Liberty.“ This book is most noteworthy because it puts us back on such a virtuous path!

Mary Jeffries, CEO, Polaroid

Edison like all inventors knew that the scope of Thrift is limitless. So did Dr. Land the founder of Polaroid, one of our companies. Ted Malloch has done all of us in business a huge favor- -he has rediscovered a virtue that unlocks the door to success and builds true character.

Dr. Stanley Carlson-Theis, Senior Policy Director, Center for Public Justice

This is a most interesting and timely topic—not exactly politically correct nor the kind of thing that captains of industry or politicians thinking of tax revenues (i.e., all politicians) want us to reflect on and pay heed too! But, thrift is a virtue that is relevant also to non tartan-skirted folks. . .

Colin A. Hanna, Executive Director, Let Freedom Ring

For most of us, thrift is the necessary precondition to generosity. In this book, Dr. Malloch points out the public as well as private benefits of the twin virtues of thrift and generosity. Both societies and individuals yearn to influence history, and this engaging book illustrates the simple truth that we must be good stewards, not merely consumers, of the gifts entrusted to us if we hope to make a positive impact on those around us.

Milt Kuyers, CEO, Faustel, Inc.

Wow…, has Ted Malloch packed a lot into this book on a much broader perspective than you could have ever guessed from it’s title. It supports traditional thought while showing excellent research and examples. It proves the thesis that thrift results in many kinds of wealth. I had to read and study it a second time to appreciate the depth of thinking here exhibited!

Dr. Paul Zak, Professor of Economics and Director, Center for Neuroeconomics Studies, Claremont Graduate University and Editor of, Moral Markets: The Critical Role of Values in the Economy

Dr. Theodore Malloch’s book on thrift reminds us of the importance of this overlooked virtue by tracing its value, both historic and contemporary. Tracing its roots from the Scottish enlightenment to the no-waste credo of Sam Walton, Malloch shows how thrift advantages others rather than ourselves, a noble act that can make us happier. Equally important, thrift provides the resources to stimulate prosperity: without savings there is no investment. Indeed, Malloch argues persuasively that underdevelopment is a moral dilemma because corruption and ineptitude have crowded out thrift. This important book is lively, topical, and immediately useful.

Paul Corts, President, CCCU

In an earlier era, America’s Calvinist president, Calvin Coolidge, argued that industry, thrift and self-control are not sought because they create wealth, but because they create character. Malloch’s treatment of thrift needs to be read aloud in classrooms so that once again our people will find and build character.

Al Sikes, Chairman, Trinity Forum

Thrift takes on “the crucial linkage between democracy, freedom and capital”. Ted Malloch asks the tough questions and goes deep to find the truths, which animate our lives. His thoughts and conclusions on “spiritual capital” are especially persuasive.

Paul Dietrich, CEO, Foxhall Capital

Thrift is not avarice. Avarice is not generous. Historically, it is the thrifty people who are generous. If we want a society of true wealth, a giving society, we will need to rediscover the virtue of thrift so well expounded in this book that should become a true classic.

Michael Van Pelt, President, Work Research Foundation

Malloch’s injection of the virtue of thrift in today’s public dialogue will challenge us to renovate our economic house, repair our appetites and help us search for what is of real value. Somehow, this forgotten virtue has me humbled at its simplicity and enthusiastic about the power of an historic idea poised to live again. This is the wise work of one of our true public intellectuals.

Bev Hendry, President, Aberdeen Asset Management

As an Aberdonian, from the north of Scotland, I can certainly appreciate the virtue of thrift more than most. Thrift as well as other traditional Scottish virtues such as enterprise, hard work and innovation has helped the Scots build up many successful global businesses particularly in the financial arena. This book shows wonderfully how that was possible.

Dr. Paul Marshall, Senior Fellow, The Hudson Institute

The word thrift seems decidedly unmodern, a fusty old term redolent of Victorian or even Puritan strictness, or perhaps hypocrisy. As this book shows, it is anything but: it is intimately tied to developments such as the economic rise of China and the other Asian tigers, and to many of the ills that plague modern America. Ted Malloch’s marvelous book roots an understanding of thrift in philosophy, economics and theology and shows how this virtue is vital to the renewal of our lives and societies.

Very Rev. Dr. Christopher Hancock, King’s College, London University

‘Where materialism thrives thrift hides’ – not so, of course: they need one another. Spending and saving, like virtue and wisdom, are matters of the soul as much as the ledger. This book by the ever erudite Dr. Malloch provides a timely reminder from someone who knows a lot about both money and virtue, that there is more to life and money than credit or cash.

Joseph Shattan, author of Architects of Victory: Six Heroes of the Cold War

If America is to prevail in today’s global economy, we will need to cultivate the virtues Ted Malloch describes in this brilliant and extremely readable book. It is wisdom on steroids.

Dwight Lee, Ramsay Professor of Economics and Private Enterprise, Terry School of Business, University of Georgia

Whether a forgotten virtue or not, Malloch makes compelling argument that thrift is a virtue that is very much its own reward. And the reward is not only, or most importantly, in the form of material wealth. Thrift is part of a package of virtues, such as discipline, accountability and farsightedness, that are necessary to a satisfying and meaningful life, and in most cases sufficient as well.

Dr Peter S Heslam, Transforming Business, University of Cambridge.

Thrift is often negatively associated with miserliness. Rooted in the verb ‘to thrive’, however, it is actually about human flourishing. Thrifty people are future-minded, prepared to delay gratification in the hope of a better tomorrow. A wealth of new research affirms the importance of this characteristic for human happiness. Against a background of over consumption based on debt-based instant gratification, Ted Malloch’s book provides a compelling case for the recovery of thrift as a practical virtue relevant to every social sphere. The author’s vast experience of many of these areas ensures that this book is not only timely but firmly based in contemporary reality.

Andrea Sachs, Time Magazine, Dec. 14, 2009

Theodore Roosevelt Malloch, whose book Thrift: Rebirth of a Forgotten Virtue may be tough sledding for the non-Ph.D. reader. Malloch, who has held positions at the U.N., the Senate Committee on Foreign Relations and the State Department, writes with passion in an ambitiously academic style. He examines the history of the concept of thrift- -the root of the word is an Old Norse verb meaning “to thrive”- -citing the contributions of the Scots and Calvinists.