A guide for good economic times

One of the professions that seem to be as much science as art is economic forecasting. Most forecasters miss important economic signs. Even the best economists did not predict the crisis of 2008 and the Great Recession that then ensued. There is a fascinating account in the Torah that offers advice and a framework to economists who predict future economic health.

The Pharaoh of Egypt had two very disturbing dreams. In the first, he saw seven healthy and well-nourished cows and seven undernourished cows which proceeded to eat the seven healthy cows. He then dreamt a second dream where he saw seven healthy stalks of corn and seven withered stalks of corn. These withered stalks of corn then swallowed the healthy stalks.

These two dreams bothered the Pharaoh greatly and he consulted with his advisors to decipher their meaning. None of the advisors were able to offer a satisfactory explanation. Eventually Joseph was brought before the Pharaoh and he interpreted the dreams in the following manner. The seven healthy cows and corn represent seven years of plenty — the time of growth and stability. Whereas the seven malnourished cows and stalks of corn represent seven years of economic contraction and famine.

Joseph advised the Pharaoh to conserve food during the years of plenty to ensure that they were prepared for seven years of economic recession and famine when it inevitably arrived.

Let's get back to basics

There are two nuances in the text that can help us understand how Joseph drew this conclusion. Firstly, the text tells us that Joseph’s reputation was that he “listened” to dreams to decipher their meaning (41:15). To truly listen one has to remove all one’s own opinions and preconceptions and take in everything that is going on around them. The second nuance is that Joseph said that God will give the answer. The name Joseph used for God in this case is Elokim. According to Jewish mystics, Elokim represents God acting within nature. In other words, Joseph allowed himself to be aware of everything which was going on, whilst taking himself and his own opinions and preconceptions out of the equation, and became aware of what naturally occurred in the universe.

Based on these two principles, listening intently and being aware of natural laws, he was able to make a sound economic prediction. He was essentially saying that after a number of years of economic growth, there will inevitably come years of economic hardship.

This is just the way Elokim, the laws of nature, works. But Joseph had a plan on how to mitigate the impact of inevitable economic hardship. He said we need to conserve during the time of plenty so that we will be able to have the wherewithal to survive during the time of famine and economic contraction. This seems obvious but few people actually do it this way.

If we look back in our own recent history, from 2002 to 2007 we experienced economic growth. But instead of conserving during that time, we collectively – both the government and individuals – ran up debt. Our savings decreased and our debts increased. We were ill-prepared for the years of economic hardship that we suffered through during the Great Recession that started in 2008. The wisdom Joseph offered the Pharaoh, thus, reverberates today.

As we approach the years of plenty ahead, we need to be aware of the natural laws of the universe that the Bible teaches. Primarily we need to realize that they won’t last forever and that they will be followed by years of hardship. Yet we can mitigate the effects if we make wise choices during the years of plenty. Economic growth is an opportunity to pay down our debt collectively and individually, and to conserve resources and money so that we are prepared for the cyclical nature of business and the economy.

Part of our undoing during the last cycle was the fact that we ignored ancient biblical wisdom about fundamental economics and laws of business and instead relied on sophisticated statistical models and predictions. This led us astray and with disastrous consequences. This time let’s get back to basics and follow these timeless Biblical rules.

Rabbi Levi Brackman is co-founder and executive director of Youth Directions , a non-profit organization that helps youth find and succeed at their unique positive purpose in life