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The Significance of Lending

The Old Testament prohibits Israelites to lend to each other at interest. "Interest" is usually neshek  literally a "bite"; some passages also use the words tarbit or marbit literally "increase" with similar meaning. Older English translations understand the words to refer to "usury" (i.e., excessive interest, however that may be defined), but I think this is mistaken. The texts forbid any lending at interest.

Many English translations also introduce the ideas of interest or usury into the use of the verbs nasha/nashah and related nouns, though in themselves these verbs simply refer to lending. But the first passage in the Bible that refers to lending, Exodus 22:25 (22:24 in Hebrew Bibles), tells people not to behave like lenders (noshim) when they lend (lawah) money to people.

It looks as if lawah refers to lending in general, in the way an ordinary person might lend something to a friend, while nasha/nashah refers to something more formal or commercial, which by its nature would be likely to involve interest.

Exodus 22 forbids Israelites to impose interest on poor members of "my people" when making a loan. The reference to the poor indicates that the text does not refer to commercial loans. One can imagine successful Israelite farmers borrowing to (e.g.) enlarge their herds, but the Old Testament does not refer to such loans. It rather presupposes a situation in which (e.g.) a farmer's harvest has failed and he needs to borrow to feed his family and/or sow for the next year. It implies the motivation that these are "my people": So be careful how you treat them.

The exhortation about not behaving like a lender shows how it is quite possible for creditors to keep the regulation prohibiting lending at interest yet still treat debtors oppressively. The Old Testament refers to this as a personal issue, a community issue, a national issue, and an international issue. In no case need it imply charging excessive interest, or even charging interest at all.

  1. Individual lenders are not to take the necessities of life as pledges, such as an ox or ass, or a garment, or a millstone or a baby (Deut 24:6, 17; Job 22:6; 24:3, 9). One oppressive lender is a man who insists on taking away a widow's children (so that they can work for him) because of the family's debt (2 Kings 4:1).
  2. A story about community controversy in Nehemiah 5 concerns oppressive lending: it may refer to charging interest or to other tough actions such as foreclosing on loans. It alludes to two reasons for debt, crop failure and imperial taxation. The two stories also make clear the results of default. One may forfeit fields, orchards, and houses, and/or one may end up in "slavery". But that conventional term is misleading, since the person's position resembles temporary indentured labor, in a sense simply employment instead of the normal arrangement whereby one works for oneself on one's own land or in one's own business. It has little in common with the chattel slavery imposed on the ancestors of many African Americans.
  3. The way imperial taxation thus burdens individuals and leads to debt was anticipated in the way national taxes burdened people when Israel was an independent state. When Israel asked for stronger central government, the prophet Samuel warned them of the burden such government would be on them (1 Samuel 8:10-17).
  4. Internationally, Habakkuk 2:6-7 warns or promises that a major power that has behaved like a creditor accumulating pledges from weaker and poorer countries will in due course become the victim of its debtors. The tables will be turned.

A second passage in Moses' Teaching expands on the point in Exodus, referring to the poor person as "your brother" and referring to the need to "revere God". It also includes reference to lending food, which makes more explicit the kind of predicament, of poor harvest, that the texts are concerned to regulate.

The passages urges the aim of letting your brother live with you as a resident alien, that is, someone who can maintain himself even though he has had to forfeit his land (Leviticus 25:36-37). People who are doing well are expected to lend freely to the needy and to accept payment in the form of labor, or of the eventual repayment of the debt in money that the person had earned through labor. So the debtor would seek to work his way back to solvency by committing himself to indentured labor for a set period or to paid employment in relation to someone who did have land.

A third passage in Moses' Teaching makes explicit that people must not impose interest on any form of loan, in money or in kind (Deut 23:19 [23:20 in Hebrew Bibles]).

That passage also makes explicit that Israelites are permitted to impose interest in lending to a foreigner (Deut 23:20 [21]), as one does not have to remit a foreigner's debts in the sabbath year (15:3). This is an example of a number of obligations that did not apply to foreigners. It did not imply usury was acceptable in relation to foreigners; the First Testament says nothing explicit about usury. This exemption with regard to foreigners has been of considerable influence in encouraging Jewish people to be involved in the commercial world, though we do not know its original background or significance.

Perhaps it allows commercial loans to (e.g.) local Canaanites or foreigners involved in trade. Perhaps it refers to resident aliens who choose not to take up full membership of Israel. Or perhaps it is a purely theoretical rule permitting loans at interest to non-Israelites is a way of underlying the prohibition on loans at interest to nearly all the people that anyone would be asked to make a loan to.

Historically, it may be that none of the material in Exodus, Leviticus, or Deuteronomy goes back to Moses. The question of the origin and relative dating of different parts of Moses' Teaching is a complex one that is unlikely ever to get resolved. A few decades ago there was some scholarly consensus on the matter, but that has now collapsed. It therefore seems necessary to work with the material as it stands without any particular theory about dating, while recognizing that the material developed, perhaps over nearly a millennium from Moses' own day to the Persian period.

Beyond Moses' Teaching, Proverbs 28:8 promises that people who augment their wealth by lending at interest "gather it for people who are kind to the poor" i.e., they will not see the profit themselves. It is a personal experience of that which Habakkuk envisages for the leading world power of its day. Psalm 15 asks the question, "Who may sojourn in God's tent" i.e., stay in God's presence. Its answer includes the general requirement of a life of integrity and truthfulness, and also some concrete expectations such as avoiding slander, keeping oaths, refusing bribes and not lending money at interest.

The prophet Ezekiel speaks in similar terms in listing obligations that people should fulfill if they wish God to treat them as righteous, such as refraining from worshiping by means of images, defiling their neighbors' wives, robbing people and lending at interest (Ezekiel 18:8, 13, 17). Ezekiel implies that people were not fulfilling these obligations, and later makes explicit that the well-to-do in Jerusalem have committed many of the wrongs he lists, including this one (22:12).

Exodus 22 begins "If you lend", but it presupposes that you will do so. To refuse to lend would contravene other exhortations regarding concern for the needy. The point is explicit in Deuteronomy 15, which urges people to lend generously to poor members of their "family". Righteous people do well in life and are therefore in a position to give and to lend and thus to be a blessing (Psalm 37:25-26). Things go well for the person who deals generously and lends (Psalm 112:5).

The New Testament confirms the stance of the Old. As with Moses' Teaching, so we do not know how much of Jesus' Teaching goes back to Jesus himself, and I leave aside this question in the conviction that the Christian development of Jesus' teaching in the New Testament scriptures is also normative for the Christian community, just as the Israelite development of Moses' Teaching in the Old Testament scriptures is normative for both Jewish and Christian communities.

The New Testament refers to lending on interest only in the context of a parable, about a man entrusting his assets to his servants (Matthew 25:27; Luke 19:23). One cannot infer an ethical position from such parables, which start from realities of life in order to make a point about something else. Jesus does urge his followers to lend to whoever asks for a loan (Matthew 5:42) and makes explicit that this applies even to enemies and applies even if you do not expect to gain in any way from the act (Luke 6:34-35). 4 Maccabees, a Jewish work from about the same period, which some Christians came to treat as near-canonical, claims that when people start conforming their lives to Moses' Teaching, even if they are by nature greedy they start lending to the needy without charging interest (2:8).

Christians have reckoned that Jesus' Teaching was more radical than Moses' but I cannot see this is so. Moses' Teaching about loving one's neighbor offers no exemption if one's neighbor is one's enemy and specifically requires one to help one's enemy (Exodus 23:4-5). It would also imply that one should not hold back from lending because the needy person was one's enemy.

For the sake of argument we may grant that (e.g.) if I want to buy a car or develop my company, someone has the right to charge me interest on a loan. But we have come to think about lending in primarily commercial terms, and scripture invites us to change that.

The focus of the scriptural material is on the predicament of needy people, and lending is a way you care for the needy, not a way you make money. The haves share with the have-nots by lending. Lending is a means of being a blessing. It seems self-evident that we have treated countries in the two-thirds world on a commercial basis when we should be thinking about them on a need basis. That in turn suggests that we have to think about whether we want to view people outside our communities or nations as aliens or as like members of the family.

The scriptural material gives membership of one's family priority over the question how good or bad are the relationships between lender and borrower. I suggest we see other nations as our brothers and sisters. It might be that the believing communities would think about such questions in a different way from the rest of the world, though the success of the jubilee movement outside the church suggests that ordinary unbelievers often rise to a challenge.

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