How moral and religious beliefs interact with market forces is a subject of much debate. Can economic incentives explain why people believe what they believe? Some of our other work has looked at the impact of economic forces on religious intensity (1) and at how incentives influence the impact of certain moral beliefs on gender-based violence. (2) This essay uses market forces to explain why fiscal and social conservatism and fiscal and social liberalism come hand-in-hand. Religious intensity as social insurance provides a simple explanation. The religious right may be against welfare because it competes against their constituency.
We use this hypothesis to help solve three puzzles: (1) Why fiscal and social conservatism align together in most countries is puzzling, since the fiscal libertarianism espoused by the Republican Party would seem to be an equally good fit with a libertarian position on issues of personal choice, such as abortion. (2) Why fiscal and social conservatism did not align together in the past, such as the Social Gospel movement, or in some European countries today, presents another puzzle. Separation between church and state is key. The welfare state is not competitive against religious groups when part of the government budget can be distributed for religious groups. (3) Why some countries separated church and state and sustain high church-state separation, high religiosity, and a low welfare state, while other countries did not separate church and state and sustain low church-state separation, low religiosity, and a high welfare state presents the final puzzle.
Today, some argue that depending on the welfare state is the same as worshiping the government as if it were God. For example:
Americans of today view their government in the same way as
Christians view their God: they worship and adore the state, and
they render their lives and fortunes to it. (3)
The Bible opposes big human government. Human government has a
limited role--it is not the solution to every problem we face. Human
government tries to replace God when it attempts to solve every
human problem. It is idolatry (worship of a false god) to look to
government to solve all our problems (i.e., poverty, health care,
education, etc.). (4)
However, this has not always been the case. In fact, from "abolition to woman suffrage to civil rights, the leaders of America's most successful liberal crusades have turned to the Bible to justify their causes, but the history of the religious left seems to stop in 1968, the starting point of a decades-long trend by which Democrats have become the secular party and the Republicans the religious party." (5)
This leads to the main puzzle--Why do fiscal and social conservatives and liberals come hand-in-hand in the times and places that they do? A large quantity of political science literature documents this pattern in congressional rollcall voting in the United States. (6) While a number of papers also document the same pattern across countries, no obvious theory explains why political alliances align along one diagonal versus another in a matrix of fiscal and social attitudes.
Scheve and Stasavage (7) have argued that theories involving denominational differences, altruism, differences in the making of inferences, issue-bundling, and spurious correlation are insufficient. A recent article theorizes why religion is salient in politics but not why Republicans and Democrats divide along religious issues the way they do. (8) Some social psychologists have argued that uncertainty aversion explains why fiscal and social conservatism come together. (9) Uncertainty aversion is consistent with a preference for insurance. The preference for insurance is the main economic hypothesis underlying the theory. The economic literature provides both theory (10) and evidence (11) of religious insurance, but what evidence is there that welfare may compete against the constituency of the religious right? …