In addition to my longer review of Hoffman’s Usury in Christendom, I have this primer as well.
The Argument Against Usury
(1) God is the supreme owner of land and leases it to men (Hoffman 30).
(2) The idea of just price is often ridiculed, but misunderstood. It does not exist within a vacuum. A just price cannot work in a society that uses interest (43).
(3) The Old Testament intended usury to be used as a weapon against the nokri, the Canaanite in the land. It was not to be used against the ger, the sojourner.
(4) Money is fungible, so it cannot reproduce artificially.
(5) God’s provision for man in nature is a presupposition against usury. “To make a claim to wealth that outstrips that provision…is to produce injustice” (105).
(6) When money becomes abstracted (from use), its usefulness becomes obscure.
(7) Profit can only come from nature’s goods, which requires discipline and patience.
(8) The Logic of Mutuum: in a mutuum loan, ownership actually passes from creditor to debtor, so to “receive a fee for this, I profit from what is yours, not mine. Therefore, the creditor sells nothing that is his, but only time, which is God’s” (99, emphasis added).
(9) In a modern day usurious system, “the worker is separated from the material means of production to be brought again into contact only by means of the credit system in which everything is capitalized” (333).
What do we make of the above points? Some hold, but others do not.
(1′) This is true. And for what it’s worth, Wyclif made the same argument.
(2′) This is harder to square. Much of “just price doctrine” assumes that an entity has a monetary price within it, yet this is all but abandoned in modern economic theory. Y is worth x because someone subjectively values it at that price.
(3′) This seems fairly true.
(4′) On one level this is a good rebuttal to the (literal) sorcery that is fractional-reserve banking. But there is something about this claim that I just can’t put my finger on.
(5′) Aquinas’s argument seems to be that the usurer is claiming a stake in future (and not yet-existing) wealth without having the disciple and patience that keeping it requires.
(6′) I’m not sure.
(7′) seems to turn on (5′).
(8′) If (1′) obtains then it appears that (8′) obtains
(9′) This sounds awfully close to Marxism. In any case, I reserve judgment.