There is a difference between a “group project” and helping one another out.   As an honor student in high school, I was often asked by my teacher to help out a student struggling in class with a particular concept. I was always thrilled to be generous with my time to help someone else improve and grow. As a teacher and son of a teacher, there is nothing more rewarding that watching someone grasp a concept and grow.   In a mentoring relationship, the student is still responsible for their own efforts and rewards, but can learn from someone with more experience or expertise. Tutoring is far superior to group projects.

I hated group projects. Why?  The teacher would pair some ants with some sluggards -to use a Bible metaphor.  She would take some “A” students and put them in a group with some “D” students.  If the instructions were, “Please everyone work together to learn the concept, but you will all be judged individually on your final effort,” the results would be good.  However, group projects NEVER work that way. Instead, group projects reward everyone equally.   Therefore, the sluggard lazy students know that they can do very little and still get the same reward as the ant students who are most concerned about their GPA.  The result is always….  A few people do all the work and the team gets the reward.    Ants resent sluggards receiving the same reward for half the effort while sluggards learn that being a sluggard works quite well.

How does this apply to economics? Europe is one giant group project.   Some countries like Germany have worked hard, been prosperous, and have savings.   There are a few ant countries.   There are also some sluggard countries. The sluggard countries don’t like the painful realities of “spending less than you make,” budgeting, and being thrifty.  The sluggard countries spend too much, run up the bills, and can’t pay their utilities at the end of the day (or in this case by the middle of October).  The sluggard countries turn to the ant countries and ask for some money to “make it through the month.”   This continues for months and years.  Eventually ant countries resent subsidizing sluggard countries.  They tell the sluggard countries (which are usually run by sluggard corrupt politicians who are stealing from nice hard working ant citizens in their country) to get their act together.   Sluggards don’t like this kind of talk. Why shouldn’t they get something… or everything for nothing?

Here is the reality Europe is in…Greece is bankrupt and will default on its debt.  It might be this month (or it may not) but it will be soon.   When it does default, all the other holders of Greek debt (other countries) are in trouble.  Why?  They bought Greek debt hoping to be repaid.  They hoped that Greece would get its act together and pay them back the money they loaned them with interest.    Psssst…   A little secret.  They will not be getting their  money back.    This is the problem.   The default cancer isn’t just about Greece now. Like a group project, everyone’s grade is infected by the kid who refuses to do his part. The whole project comes apart when one student let the dog eat his homework.

The stock market is railing. The banks are panicking.  Trouble is on the horizon.   This is what happens when you build an economy on “group rights” rather than individual rights. This is what happens when you take away Biblical ideas like property rights, incentive, and reaping what you sow.   Any system that rewards sluggards and punishes ants is doomed to fail.   Any system that allows corrupt politician sluggards to exploit and steal from hard working ant citizens is unjust.

Proverbs 6:  ⁶ Go to the ant, you sluggard!  Consider her ways and be wise,  ⁷ Which, having no captain,   Overseer or ruler,  ⁸ Provides her supplies in the summer,  And gathers her food in the harvest.  ⁹ How long will you slumber, O sluggard?   When will you rise from your sleep?   ¹⁰ A little sleep, a little slumber,  A little folding of the hands to sleep—  ¹¹ So shall your poverty come on you like a prowler,   And your need like an armed man.

For a free first session of Godonomics:  http://www.godonomics.com/watch-session-1