Why Are We So Rich?

The Industrial Revolution happened after Calvinists in the Netherlands claimed that personal wealth was legitimate

One of the big, maybe the biggest, unsolved mystery of recorded human history is that of the origins of the industrial revolution. Why did it happen at all? Why then, and not earlier or later? Why there, and not some other place?

In a time when many denounce the Industrial Revolution, and even the Prime Minister of the country of its origin says that it marked the point when “the doomsday machine began to tick”, one might expect people to want to get to the bottom of this mystery, so as to “correct” it properly, and not make an even greater mess of it.

For the record, I’m not in the camp of those who think that the Industrial Revolution was on balance more evil than good. I think it has so far saved billions of human lives, most of which would otherwise have died in infancy, most of the rest before age 6.

However, in this post, I’m not going argue whether the Industrial Revolution was good or bad for us. Instead, I will analyse a talk given by Dr. Gary North in 2013, where he discusses a very likely reason for the origin of this revolution.

He begins by comparing two predictions, which were made in 1783 and 1798. The earlier one was made by American educator, academic, Congregationalist minister, theologian, and author Ezra Stiles (1727-1795). The other by English cleric, scholar and economist Thomas R. Malthus (1766-1834).

Stiles predicted that in two- or three hundred years, the freshly created United States of America would be inhabited by 300 million people. North points out that, while in the census of 1800 the number of people counted was 5,308 Million, the figure of 300 Million was reached “almost to the day 200 years later.”

Malthus, on the other hand, observed that food increases arithmetically, but population increases geometrically. Which means that, inevitably, at regular intervals in our history, we run out of food, there are mass famines, and population decreases significantly.

North comments that Malthus made his prediction on the basis of history. It had always happened: Growth, then famine.

Malthus was right – up to the time when he wrote his prediction (1798).

And, as an aside, North mentions that Malthus’ exposition inspired Charles Darwin, by way of economics and the early communists’ (now debunked) “iron law of wages” to the idea of the survival of the fittest. North: “It was the first time social science shaped natural science.”

However, sometime between 1780 and 1820, something unexpected happened: Economic growth began to compound. By about 2 or 2.5 percent per year. Year on year, ever since. It started in northwest Europe, the British Isles and the United States. It has never stopped and it has spread. It changed the world completely. North: “We are still living in this time of transformation.”

North then refers to a book by Deidre McCloskey with the title “Bourgeois Dignity: Why Economics Can’t Explain the Modern World”. The author, points out North, is very sophisticated in many fields and was for a time the editor of the “Journal of Economic History”. In this book, North says, McCloskey goes through all the known theories on the origins of the Industrial Revolution – and debunks them all. North lists some of them in his speech:

Scientific flowering

Respect for learning/universities

Education of the elite

Printing and paper



Peace and bourgeois prosperity


Investment capability

Temperate climate


Rise of rationality

Rise of greed

Spanish and Portuguese imperialism

Price revolution

Dutch, British and French trade

Dutch, British and French imperialism

The slave trade

Rises in the rates of saving

None of these explain the sudden appearance, at the time, of compound economic growth.

Then what was it? McCloskey’s own theory is a “change of rhetoric”. That however is too vague for North. He attempts a more specific theory (though he points out that it is not yet proven):

Early in the 17th century, there took place in the Netherlands a change in attitude towards “entrepreneurship, innovation and personal wealth derived from innovation and entrepreneurship.” It happened in the middle of a long war (namely against the Spanish empire, with ran from 1572 to 1647).

North offers two reasons for this change of minds:

  1. Ethics. Transformation of what constitutes good and evil. For the first time, within the preaching of the Protestants and especially the Calvinists, there was a shift of view. And that was that personal wealth was legitimate.
  2. A shift of the view of the future. A new optimism about what the Kingdom of God can do in the midst of history. That there can be a compound expansion and growth of liberty, power and influence in a society that is faithful to the ethics preached by the preachers.

North wonders whether this applies not just to Calvinists, but also to Arminians. Because, he says, the big debate in northern Europe at the time was that between these two Christian movements – essentially, the English Civil War was based on this “debate”. This was followed in 1688 by the Glorious Revolution, which ushered in what North calls a “secularised version of Cromwell’s Calvinism”. It reduced the power of the established church.

The change in the view of the future led to what is now called postmillennialism. This is the idea the Jesus won’t return until after the Kingdom of God extends around the world. Until the early decades of the 17th century, this view never had a widespread acceptance, says North. In fact, in the century before “it was forbidden for Lutheran priests to teach this.”

Eschatology, the view of the future, matters a lot, insists North. And: “Postmillennialism is radically optimistic about the future.”

These two points, the legitimacy of individual wealth and entrepreneurship, and the postmillennial eschatology of the Kingdom of God expanding before Jesus returns to Earth were linked together in a secularised fashion by the Anglo-Dutch philosopher Bernhard Mandeville in his “Fable of the Bees” (published in 1714). The idea was later picked up by the economist Adam Smith, who taught that the pursuit of individual, rational and moral self-interest leads to the wealth of nations. (Smith’s famous book with the shortened title “The Wealth of Nations” was published in 1776.)

Finally, North claims there is an equivalent teaching in the Bible, namely in Deuteronomy 8:17-18: “And thou say in thine heart, my power and the might of mine hand hath gotten me this wealth. But thou shalt remember the Lord thy God: for it is he that giveth thee power to get wealth, that he may establish his covenant which he sware unto thy fathers, as it is this day.” (KJV)

North concludes:

“It took from that document (Deuteronomy) until early 17th century Netherlands to convince that wealth and prosperity were confirmations of the covenant of ethical behaviour. This is how we got to where we are, why we got rich. A combination of ethics with a vision of a future. Calvinist doctrine, but picked up by Arminians too. The link: pursuit of individual self-interest as a means of transforming social order.”

North’s idea is certainly a theory worth pursuing. A Christian origin and foundation of the Industrial Revolution would explain, amongst other things, why Karl Marx, who definitely had some Satanist leanings, was so hellbent on destroying capitalism.

North’s theory would revolutionise our view of the Industrial Revolution. About time, too.