Chapter 18: Church Covenant
Christian Economics: Student's Edition
[Updated: 1/18/18]
I know your works: you are neither cold nor hot. Would that you were either cold or hot! So, because you are lukewarm, and neither hot nor cold, I will spit you out of my mouth. For you say, I am rich, I have prospered, and I need nothing, not realizing that you are wretched, pitiable, poor, blind, and naked (Revelation 3:15--17).
Churches today, as with every other institution, are rich beyond the wildest dreams of men in 1800. The vast outpouring of productivity which the free market has produced since 1800 has transformed all of us. By historical standards, we are fantastically wealthy. Yet the church is miserable, poor, and blind today, just as the church of Laodicea was in John's day. It is neither hot nor cold. It has lost its impact in society.
How did this come about? How is it that the church of Jesus Christ, which has been granted a covenant by God himself, should have proven to be so impotent culturally, economically, educationally, and politically ever since the mid-nineteenth century?
It has to do with theology. It has to do with an unwillingness to challenge the central orthodoxies of the city of man. It has to do with the surrender of authority to the city of man. The question is: Why did the church surrender this authority?
Point one of the biblical covenant is God's transcendence, yet also His presence. This is the biblical principle of God's original sovereignty. It asks: "Who's in charge here?" How does this apply to the institutional church?
The church is called the Bride of Christ.
Husbands, love your wives, as Christ loved the church and gave himself up for her, that he might sanctify her, having cleansed her by the washing of water with the word, so that he might present the church to himself in splendor, without spot or wrinkle or any such thing, that she might be holy and without blemish (Ephesians 5:25--27).
Therefore, the church has a unique covenantal connection to God. The doctrine of the Trinity teaches that Jesus Christ is the incarnation of the Second Person of the Trinity. This means that the church is favored above all other institutions. God is transcendent to the church, yet He is also present with the church.
Church members and church leaders must defend the integrity of the church against all challengers. They must do this with the same degree of commitment that they defend the doctrine of the Trinity. They must believe that they separate themselves from the bride of Christ when they refused to join a church. They must see their connection with Christ in terms of their membership in a local church. Churches must defend the doctrine of the church. Membership in the church is not optional. It is a covenantal responsibility. Churches must preach this, teach this in Sunday school, and remind people of this whenever there is an excommunication.
Point two of the biblical covenant is hierarchical authority. It asks: "To whom do I report?" How does this apply to the institutional church?
Churches should not accept money from any unit of civil government for any program operated by the church. This includes charitable ministries, free public school textbooks for church-operated schools, or any kind of direct subsidy. Whenever a church receives money from any institution, it becomes dependent on that institution. Your church's budget is threatened if such subsidies are removed. The church must never become dependent on external sources of income from any other institution. Churches should be supported by the donations of their members. The only major exception would be in those rare instances where churches have television ministries, and they ask for financial support from nonmembers who watch the broadcasts. This would be a payment for spiritual services rendered. This donated money is not extracted from the taxpayers. Such is not the case with subsidies from the civil government.
Pastors should preach against the idea that tax exemption is an indirect subsidy from the state. This idea is pernicious. It rests on a philosophy of civil government that says that the state owns everything in principle, but it graciously exempts certain individuals or institutions from having to pay taxes. This is why pastors should preach against the idea of tax exemption for churches. They should preach the doctrine of tax immunity for churches. This is completely different from tax exemption. The idea of tax immunity is based on the superior jurisdiction of the church above the state. The church is the bride of Christ. The church extends into eternity. The state has no legitimate authority whatsoever over what the church does with its income. Tax immunity is not based on the idea that the state graciously grants to the church an exemption from taxation. Such an idea places the state above the church in terms of its authority and lawful jurisdiction. Churches should never accept such an idea. Churches should not apply for tax exemption. They should simply say that they are churches, and that they are not subject to taxation. This is possible in the United States. Churches do not need to apply to the Internal Revenue Service in order to be granted tax exempt status under what is known as the 501(c)(3) section of the Internal Revenue Code. They should not apply for this status. They should simply declare that they are churches, and therefore they do not have to file any papers or money with the Internal Revenue Service, other than for salaries paid to individuals who work for the church. From the point of view of economic analysis, the church does not pay these taxes; the employees do.
In a famous American Supreme Court decision, the Chief Justice of the court declared this: The power to tax is the power to destroy (McCulloch v. Maryland, 1819). This is an accurate assessment of the threat of taxation. This is why churches should not be subject to any taxation. To tax the church is the power to destroy it. It is not that the state has graciously granted tax exemption to churches. Rather, they are tax-immune in the eyes of God. God does not grant to the state the right to tax churches. Christians should defend this principle politically. They should not surrender to the idea that a supposedly religiously neutral state has the right to tax churches, but has graciously granted exemptions to them. This idea of tax exemption acknowledges far too much authority on the part of politicians to determine whether or not to tax churches.
Point three of the biblical covenant is ethics. It asks: "What are the rules?" How does this apply to the institutional church?
The welfare state has used taxpayers' money in order to set up charitable services. These are not charities. Charities are supported by voluntary contributions. These so-called charities are in fact vote-getting devices. The politicians extract money from one group of taxpayers in order to support another group of taxpayers. The tax-supported taxpayers are then expected to vote for the politicians. These votes are payments for political services rendered.
One of the justifications that defenders of the welfare state use this: churches have defected on their responsibilities for caring for the poor. This criticism is correct. But this is no legal or moral justification for the state to use coercion in order to extract money in a gigantic vote-getting system of wealth redistribution.
Churches should set up ministries under the control of their diaconates. The deacons should determine which requests for support are legitimate, and which are not. The church has biblical responsibilities for doing this. This is why the diaconate was created in the first place (Acts 6). Deacons should gain experience in giving away money when times are relatively good. This will prepare them for a wave of requests from members and nonmembers to receive money when times get bad.
The church has a legitimate healing function. Healing is related to salvation. The English word salve reflects this. A salve is a healing ointment. When the state uses taxpayers' money to imitate the church in providing this form of healing, it becomes messianic. The modern welfare state is messianic. This is one reason why every modern welfare state is involved in supplying money for medical care. The state is invading the sanctuary of the church. The state is attempting to persuade voters that the state's power of coercion, not the churches' authority to ask members for financial support, should be the basis of healing in modern society. The voters have accepted this implicit claim by the state. Welfare states are notorious for their secularism. They are attempting to replace the church, and the means of doing so is money that has been extracted from the taxpayers, and which is then spent on pseudo-charities, especially healthcare services. Welfare states are attempting to undermine the authority, legitimacy, and influence of churches by means of money extracted from the voters. This arrangement extends the bureaucracy of the state into every area of life in which the state funds operations.
Because the vast majority of Christian theologians and pastors believe that civil law is neutral, they rarely preach against specific violations of biblical law by the state. They remain generally silent about the activities of the state. The idea that the state should enforce biblical law has been unpopular since the days of the Roman Empire. When they got into control of the Roman Empire in the early fourth century, Christian leaders used Roman law, not biblical law, to administer the Empire. This set a precedent for the church that is still honored by the church. The resulting problem is this: the church is tempted to drift with the social, moral, and legal orders of the non-Christian world outside of the institutional churches. The church does not serve as salt and light within civil affairs. But in the kingdom of man, civil affairs are regarded as sovereign in almost every area of life. About the only area of life that is considered off-limits to the government has to do with sexual activity. The modern state tolerates and even encourages sexual debauchery. Except for sexual activities, the state is regarded as sovereign in the affairs of men.
It is important that Christians resist the idea that the modern welfare state operates in terms of legitimate ethical law, which is biblical law. The modern welfare state is in rebellion against biblical law. Modern Christians are also in rebellion against biblical law, which is why there is a political alliance between the secular humanists and the pietists. The pietists have surrendered any degree of authority in civil affairs, and this is strongly supported by the humanists who are in control of civil affairs.
Christians have adopted the ethics of the rewritten eighth commandment: You shall not steal except by majority vote. They are as supportive as pagans are of tax-funded education, government-funded pensions for all citizens, and universal health care for the aged. Christians go along with the city of man in order to get along with the city of man. They do not think it is imperative that the city of man be replaced by the city of God in history.
Point four of the biblical covenant is sanctions. It asks: "What do I get if I obey? Disobey?" How does this apply to the institutional church?
Point four has to do with church sacraments, for they are oath-signs that place members under the sanctions of God's church covenant. This is the covenantal basis of the tithe.
Abraham paid a tithe to the high priest Melchizedek (Genesis 14:17--20). Jesus Christ is a high priest in the order of Melchizedek (Hebrews 7). Therefore, church members owe a tithe to the local church.
The local church is entitled to the tithe, or 10% of family income. Because most churches no longer preach the covenantal requirement of the tithe, they have not been able to redirect the flow of authority in their direction. Authority flows in the direction of those institutions that bear social risks and take responsibility. The churches have not called upon their members to make available the funds that God says His church is entitled to. Churches, like families, have thereby transferred power to the state.
The tithe is built into man's affairs. Either we pay it to the church or else we will pay it to the state. The church limits its lawful demands to 10%; the state extracts all it can get. The modern welfare state demands far more than the tithe. The combined level of taxation of all branches of government in the United States exceeds 40% of all national income. This is sinful. It is also the judgment of God on rebels. It happens every time men rebel against the tithe. The taxes of Egypt in Joseph's day were only half of this, or 20% (Genesis 47:24). The prophet Samuel came before the Israelites and warned them that the king they wanted would eventually take 10% of their wealth: "And he will take the tenth of your seed, and of your vineyards, and give to his officers, and to his servants" (1 Samuel 8:15). Christians live in a country that extracts four times the tithe from them, and they vote for politicians who promise even more government spending. They are in bondage, but they fail to recognize it. They are in Egypt, but they fail to recognize it.
Point five of the biblical covenant is inheritance. How does this apply to the institutional church?
Modern churches have completely rejected the idea that members of the city of God are to spend their lives working against the city of man in economic and civil affairs. They believe that there is moral, covenantal, and judicial neutrality in the realm of economics and civil affairs. Therefore, pietistic Christians insist, Christians should not challenge the prevailing social and economic order. They do not believe that there is so intense a competition in history between the city of man in the city of God that members of the city of God should work to replace members of the city of man in civil affairs. They insist that Christians must remain in what is functionally the loyal opposition. They do not ask this question: Why should Christians be loyal to the city of man?
Christians do not believe that they are morally required to spend less money than they earned after taxes and tithe, so that they leave an inheritance to their children. This is supposed to help them to become wealthier, more influential, and more powerful than members of the city of man. Christians normally expect their children to become less wealthy, less influential, and less powerful than members of the city of man. They have accepted social defeat as a way of life. They have invented theologies of inevitable defeat which predict that the church will be a failure historically in implementing the Great Commission of Matthew 28:18--20. "All authority in heaven and on earth has been given to me. Go therefore and make disciples of all nations, baptizing them in the name of the Father and of the Son and of the Holy Spirit, teaching them to observe all that I have commanded you. And behold, I am with you always, to the end of the age."
Because they have given up hope in the future, they are unwilling to commit to a program of comprehensive redemption. They have a theology which says that the city of man in the realm of civil affairs is legitimately exempt from the gospel, and therefore it is legitimately exempt from biblical law. They believe that Christianity has nothing unique and covenantally authoritative to say in the realm of civil government. They believe the same with respect to economic theory.
First and foremost, pastors should preach the obligation of members to tithe. Churches should not be in the position of begging members for money. When members don't tithe, they are stealing from God. Pastors should preach this theology on a regular basis. If some members leave because of such preaching, this is to the benefit of the local congregation. A tithing church is a faithful church. It is a church made up of self-disciplined members. It is in a position to confront the modern welfare state. These are the kinds of churches the world needs. (www.CovenantalTithe.com)
Second, churches should take at least 10% of their income from people's tithes and offerings and set this money aside for welfare activities. They should care for the poor, or work with other local churches that have ministries to the poor. In the worldwide division of labor, certain churches should specialize in certain kinds of charitable activities. They should make available training materials, free of charge, to other churches that want to start such programs. These materials can be distributed free of charge on the World Wide Web.
Third, churches should revamp their diaconates. They should make it clear to all members that access to free money in times of crisis is only available to members who have taken care to purchase insurance against the worst effects of these unexpected crises. There are no free lunches in life, and churches should not encourage members to believe that the church is just another government welfare agency. Insurance is one of the great inventions of the modern world. It enables families to reduce the impact of life's unpredictable setbacks. Every adult church member should be warned in advance that the deacons will not provide money for families that have not purchased insurance that would have covered expenses that the heads of households later ask the deacons to pay for.
Here is the rule: do not use church funds to support improvident families that need money because they failed to purchase insurance. To do so is unfair to those members of the church who have protected their families by purchasing insurance, and who are now being asked to support improvident families. This is what the welfare state does. It should not be what churches do.
Churches should see to it that the wife of every head of household has sufficient low-cost term life insurance written on her husband's life to protect her and the children. She should own the policy, paying for it from her own personal, exclusive checkbook. This establishes her as the owner of the policy. Why should she own it? What if he quits the church, divorces her, and remarries? If he owns the policy, he will name the new wife as the beneficiary, leaving the first wife without alimony income if he dies. If he dies, the covenantally faithful wife should be protected. The church should not be responsible for supporting her.
What if a family is really poverty-stricken? What if it really can't afford money for basic health insurance protection? In that case, deacons need to step in and give the family enough money to meet the annual premium payment to the insurance company. Why? Because the church has this obligation biblically. The deacons are acting in the name of God, in the name of the family, and in the name of the congregation, which also needs protection from these costs. The deacons should then ask the family for proof that it used the money to buy such insurance.
The church becomes responsible if there is an accident or illness, and the family is impoverished because of medical costs. Deacons should intervene by going to the hospital to inform the hospital that the family is impoverished. Deacons should negotiate with the hospital to get the hospital to reduce the bill.
The church therefore has a legitimate police function to make sure that each member has adequate health insurance coverage. This should be high-deductible health insurance, which is cheaper to buy. A wise church makes it clear to all members that they are responsible for buying insurance in order to become eligible for aid from the deacons. Insurance reduces or eliminates this risk to churches. If members don't do this, the church can legitimately tell these members in a crisis that there will be no free money.
Churches should assist non-church ministries that specialize in aiding the poor: hospitals, charitable ministries, rescue missions, and so forth. Let those who better understand the needs (and "hustles") of the poor administer the funds. Pastors should preach regularly on the topic of church responsibility to the poor. They should also make it clear that such teaching is in open opposition to the modern doctrine of the state's responsibility to the poor. They must call for a replacement operation, not a church-financed supplement to the modern welfare state. Anyone who preaches for more private charity without also calling for a reduction in tax-financed charity is a guilt-manipulator and an accomplice to the welfare state.
Poverty programs must be accompanied by preaching and instruction concerning the moral responsibility of the able-bodied to work. Paul wrote, "If anyone will not work, neither shall he eat" (II Thessalonians 3:10b). The world doesn't owe any able-bodied person a living. Neither does God. To aid laziness is to aid evil. The long-term goal of most charity programs should be to make the recipients financially independent. State-run poverty programs are programs for extending poverty. Rome had similar programs in the era of the early church. These programs bankrupted the Empire financially, but Rome had been bankrupt morally long before. The proof of this moral bankruptcy was the existence of the politics of bread and circuses. It is no different today.
Pastors should teach the biblical principles of financial success: self-discipline, thrift, hard work, customer service, thrift, future-orientation, saving for retirement, thrift, profitability, low or zero debt, thrift, long hours, family sacrifice, reduced lifestyle, and thrift. They should prepare their people for the worst, so that people will be capable of handling the best, when it comes.
Churches need to train their members in the theology and specifics of Christian dominion in every area of life. Christians are supposed to inherit the earth. In fact, we have inherited the earth by God's declaration (definitive inheritance), but we have not yet occupied it (progressive inheritance). We have not yet established authority by service. Adam inherited the earth before he sinned and gave it away, but even in his sin-free state, he had to take possession of his inheritance. He received title, but he didn't receive it completed. He first had to take communion at the tree of life. Through Christ, we have inherited the earth. We, too, must now take possession of our inheritance. We have title, but we have not been given occupancy. That takes a program of dominion.
The church's self-imposed impotence, meaning its refusal to accept social responsibility, has made possible the rise of the welfare state. Liberal theologians have applauded this turn of events, while conservative Christians have grumbled a lot, but they have done little institutionally to fight it. Let us assume that the welfare state system continues. Taxes will remain high. Government budget deficits will continue. Governments will eventually default on welfare payments. There is no long-run statistical alternative to default. We will have a series of devastating financial crises, just as Rome had after the year 200, and just as France had just before and during the French Revolution (1785--1795). When these crises hit, local churches will be subject to economic pressures that they have not seen since the Great Depression of the 1930's. Giving will drop unless members are highly self-disciplined. Members will lose jobs. They will find their savings wiped out. The poor will multiply. This time, unlike the 1930s, the state will have tapped into every known source of taxable income. There will be no state-financed "safety net" next time.
Which groups will be ready to offer support by being willing and able to organize and make available charity? Which groups will have prepared their members for the risk-taking and responsibility-bearing that are needed for survival in an economic crisis? Who will be ready to lead?
The churches are just barely getting ready to consider such a shift in responsibility, let alone a shift in authority. If revival comes alongside the economic crises, as I would expect, then church leaders have to be ready to answer the fundamental questions:
How did the world economy get into such a mess?
What biblical economic principles were violated, 1913 to the present?
How do we return to biblical economic principles?
Who should finance reconstruction?
What should I do with my money?
What should I do if I lose my job?
How can I afford to tithe?
Pastors and deacons are almost completely unprepared to take leadership today. No one expects them to. They are considered unnecessary by most citizens. After all, the Bible-believing church has had little or nothing to say about economic issues for well over a century. Economics has been considered off-limits to preachers in conservative churches. This will change, and it will change fast, when the crises hit. At that point, those churches that begin to exercise responsibility will position themselves as leaders in the national and perhaps even the worldwide transformation which may lie ahead. Pastors had better begin now to preach God's principles of success, and God's principles of responsible giving. They need lots of practice.
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For the rest of this book, go here: https://www.garynorth.com/public/department188.cfm