AUDASE

David Brat’s Hand-of-God Economics

By BINYAMIN APPELBAUM  NY TIMES

Even before David Brat’s out-of-nowhere victory against Eric Cantor last month, there was plenty of skepticism about whether he merited the label of academic economist. Brat, a professor at Randolph-Macon College in Virginia, is certainly not in danger of winning a Nobel Prize: He writes discursive papers devoid of math; he has cited Wikipedia as a source; and he has never been published in a significant journal. But his big idea — that Protestantism is good for the economy — has a surprisingly distinguished history.

The financial crisis of 2008 shook an abiding faith in the free markets that had dominated policy making for a generation. Liberals responded by calling for increased regulation. Conservatives, distrustful of both Wall Street and government, have struggled to articulate their own alternative. But Brat, who describes himself as a "100 percent free-market-Milton-Friedman-Chicago-School-Hayek economist," saw confirmation of his longstanding idea that markets are perfect places inhabited by imperfect beings. On the campaign trail, Brat declared that bankers should have gone to jail and that "crony capitalists," like Cantor, had undermined the system. "I’m not against business," he said. "I’m against big business in bed with big government."

1. David Brat isn’t going to win a Nobel Prize in economics.

2. But he is hardly the first to argue that religion is good for growth.

3. Unfortunately, faith is not enough.

Instead of arguing for any specific regulation, however, Brat said that the system simply needed more virtue. "We should love our neighbor so much that we actually believe in right and wrong and do something about it," he wrote in a 2011 essay for Interpretation: A Journal of Bible and Theology. "If we all did the right thing and had the guts to spread the word, we would not need the government to backstop every action we take."

The idea that religion plays a role in economic growth was most famously advocated by the German sociologist Max Weber. In his 1905 book, "The Protestant Ethic and the Spirit of Capitalism," he argued that Protestant countries developed more quickly because they embraced hard work as a virtue. Over the decades, others have continued to see merit in the theory, including J. Bradford DeLong, an economist at the University of California, Berkeley, who presented statistical evidence for it in a 1988 paper. Even Friedrich Hayek, a professed agnostic, grudgingly acknowledged the role of religion. "Like it or not," he once wrote, "we owe the persistence of certain practices, and the civilization that resulted from them, in part to support from beliefs which are not true."

Weber’s view has since fallen out of favor, but Brat, who studied at a Presbyterian seminary before pursuing a degree in economics, has tried to carry on an extreme variant of this tradition anyway. In his doctoral thesis at American University, "Human Capital, Religion and Economic Growth," he argued that Protestant countries grew more quickly because they were particularly supportive of scientific exploration. The role of religion was "not large compared to other factors," but ignoring it would "be a significant omission." Over the years, he has grown only more convinced of his views. "The one source of economic growth is virtue," he told The Richmond Times-Dispatch last year. "It is not property rights, not law or resources, but virtue."

Brat’s political success suggests a fundamental evolution in the Republican Party. During the late 1990s, Senator Phil Gramm and Representative Dick Armey, former economics professors, played key roles in the government’s deregulation of the financial industry. Gramm helped write the Gramm-Leach-Bliley Act of 1999, which cleared the way for the emergence of financial supermarkets, like Citigroup, that offered banking and brokerage and insurance services. Armey, as the House majority leader, was a noted deficit hawk.

But neither of them identified closely with the Christian right. Free-market economists, after all, are explicit that companies are held accountable by customers, competitors and shareholders: They don’t need the government’s help, and they don’t need God’s either. Religious voters effectively ended Gramm’s bid for the presidency in early 1996, when he was upset by Pat Buchanan in the Louisiana caucus. And Armey, who left Congress in 2003, has continued to argue that some of the Christian right’s views are at odds with a libertarian commitment to individual freedom. "When the social conservatives and the economic conservatives work well together is when they work with a common resistance to the growth of the power of the state," Armey said in 2010. "My point is very simple: You live a righteous life, you’re an encouragement to other people; use the state to impose it, and you’re a tyrant."

But whereas the Republican Party was once a coalition of capitalists and Christians, it’s increasingly populated by people who profess belief in both. David E. Campbell, a professor of political science at the University of Notre Dame, has found a significant overlap between the Tea Party and the religious right. In 2006, Campbell and his collaborator, Robert D. Putnam, a professor of public policy at Harvard University, interviewed about 3,000 Americans. When most were interviewed again, in 2011, the professors found that the people most likely to identify with the Tea Party were those who previously wanted religion to play a large role in government. Campbell said that it made sense that people who came of age when the Republican Party was a coalition of those two things are now forming a generation that "is just going to believe in both things."

Brat may be a politician for his time, but it is hard to have faith that religion holds the answer to our economic problems. Bankers continue to behave badly, but the markets break down even when participants are virtuous. Government regulation isn’t meant to substitute for failed virtue. It’s there to make markets work.

Binyamin Appelbaum is an economics reporter for The Times.