Facing Tough Times with Faith and Confidence

Recession Predictions

Chuck Bentley, CEO Crown Ministries
April 2008

I find a lot of truth in economist Paul Samuelson's famous tongue-in-cheek quote, and it keeps me humble in regard to my opinion about where the economy is going. But over the past few weeks, the headlines have predicted much about the U.S. and global economies.

First, economic downturns need not be a cause for panic. With much fear and uncertainty in the news, it's easy to believe that even more bad news is on the way. But as Christians, we should avoid allowing current events of any kind to create fear-based decisions. In 1 Chronicles 29:11, David wrote, "We adore You as being in control of everything" (TLB). These words should comfort all of us in uncertain times. It wasn't too many years ago that the fluctuations in the Dow Jones Industrial Average accurately graphed my emotional condition. If the Dow was up, I was positive. If the Dow was down, my outlook was negative. I have since learned not to become overly negative or enthusiastic with the swings in the economy since only the Lord Himself knows the future. Notwithstanding what the Bible shares with us about future events, I personally cannot see one second through the veil of time. This limitation exists to allow us to exercise our faith.

Second, our federal government is not on the brink of bankruptcy. While the federal deficit has spiraled to over $9 trillion--that's in real dollars--the U.S. economy has grown substantially as well. The U.S. national deficit stands at approximately 65% of our GDP (Gross Domestic Product). By the same measure, China's deficit to GDP ratio is estimated to be about 16%, Israel's stands at 87%, and Japan's tops out at 170%. When considered in context to our national wealth, we are a long way from an all-time high deficit-to-GDP ratio. In 1946, our federal deficit reached 121.7% of our GDP. This historic high occurred under the Truman administration during World War II when the nation experienced high deficit spending combined with a slower economic growth. Don't get me wrong, the U.S. debt needs to be reduced, but we are far from the disproportionate levels reached in the 1940s. Whether we are faced with recession, inflation, "stagflation" or even a depression, it is far more important that we reduce our personal debt levels. I advocate being totally debt free, which minimizes our dependency on how our government operates the federal budget and thus minimizes our vulnerability to economic fluctuations.

Finally, the uncertain state of the economy serves to remind us of Hebrews 13:5; "Keep your lives free from the love of money and be content with what you have, because God has said, 'Never will I leave you; never will I forsake you'" (NIV). Our ultimate preparedness is to avoid fear or panic, reduce our vulnerability created by debt and remain dependent upon Christ who is the never-changing constant in an ever-changing economy. He loves us, and He will always be there, whether the money is or not.