Usury and the Catholic Hierarchy

All popes, cardinals, bishops, abbots, priors and so on are sinners.  They will be the first to tell you that.  In what way do they sin?  Probably in the most mundane ways.

Is it possible they sin in remarkably similar ways?  Probably.  For example, the selling of indulgences was a widespread and lamentable practice.  It motivated Luther to divide the Church, and Pope Adrian confirmed the error of the Churchmen in a letter to Luther.

Is it possible that the Churchmen today are engaged in a similarly widespread odious practice?  Yes, we can see plainly they do in regards to usury.  Although the church professes explicit rejection of usury, the practice is widespread.

With remarkably little sophistry, the practice is given a pass.

Usury, the taking of interest on a loan, is strictly forbidden because it does harm.  It is expressly how the powers that be, the ones devoted to doing evil, aggregate the power they need to literally call the shots, advance the greedy agenda of accumulation, theft, misallocation, war and so on.

A loan, properly understood, is a charitable act if given outside of commerce, and a mutually beneficial act if given inside commerce.  Under no circumstances can any fee be attached to a loan.  One can argue that it is not a fee, or it is not a loan, or the world is different now, and such arguments offer widespread comfort.  So did the arguments for selling indulgences.

You make a loan to someone who is in a jam, and will be helped.  (You do not loan money to people who will not be helped). The charitable part may get intense if the party to whom you made the loan in fact cannot pay it back.  It becomes alms.  If you demand interest, you are exploiting someone in jam.  Numerically, most loans carry no usury, although the IRS will penalize the practice of no usury.

As a kid my parents would send me to the corner store to get “one pound ground round” and the proprietor would ring it up, write my family name on the receipt, and throw it in the till.  I never paid anything at the store.  Same at the drug store a block away. My father got paid once a month, and went in to pay his tab where he ran them up.  My dad gave his employer credit ( a loan - the time my dad waited to be paid), the grocer gave my dad credit, the wholesalers gave the grocer credit, the manufacturers gave the wholesalers credit and so on.  No one charged anyone interest (usury).

In 1971 the last vestiges of a gold standard were wiped out in USA, and this world disappeared into a system that shifted from human relationships to corporate relationships. All such transactions went through banks (credit cards) where interest could be applied and taxes mulcted.  We did this to win the Vietnam War, and to finance the great war on those in poverty.

Now you could take on debt unto the 3rd and 4th generation and pay only interest (with a tax deduction!) E Z.  Rare is the Bishop who could pass up a new cathedral made possible by the promise of interest on a loan based on collection basket projections.  This is just the modern version of an appallingly widespread abuse.

The Council of Trent was convened in part  to address the widespread selling of indulgences.  Selling indulgences was expressly prohibited already at that time, as usury is today.

But desiring that the abuses which have become connected with them, and by any reason of which this excellent name of indulgences is blasphemed by the heretics, be amended and corrected, it ordains in a general way by the present decree that all evil traffic in them, which has been a most prolific source of abuses among the Christian people, be absolutely abolished. Other abuses, however, of this kind which have sprung from superstition, ignorance, irreverence, or from whatever other sources, since by reason of the manifold corruptions in places and provinces where they are committed, they cannot conveniently be prohibited individually, it commands all bishops diligently to make note of, each in his own church, and report them to the next provincial synod. (Sess. 25, Decree on Indulgences)

Perhaps some day the church will issue something similar in regards to interest (usury).  “Dear Lord, give me chastity, just not right away.”

Sin makes one dull, and this sin has obscured a parallel that needs highlighting.

We all know the church teaching on contraceptives, which forbids the use thereof, for contraceptive violate the creative and unitive aspect of sex within marriage.

This teaching is lost on very many people.  What is the difference between NFP and ABC when the goal is the same?  While the subtlety is too fine for many minds, without culpability, no Bishop could possibly claim to be obtuse on this point.

Usury likewise destroys the creative and unitive aspect of commerce.  Investment in enterprise is to participate in some way, bringing together time and talent and treasure, to the benefit of all.  What mistakes are made redound to the people immediately involved.  What success they have is directly related to fine tuning their offer to the customers immediately at hand.  The outcome is creative, the process is unitive.  New and better is created, the new and better bring people together.

In a market free of usury, people with innovative offers find participants with time talent and treasure to share in the introduction.  Naturally these are small businesses who introduce a marginally attractive product or service, and over time, by means of customer feedback, ever improve their offer and thus widen the market.  They spawn imitators and at some point come to the attention of large firms that take the idea and apply large scale economies of scale in manufacturing, finance and distribution, among others, to lower the price to the point where virtually everyone has access to the good or service, with their own money.

This is the proper understanding of wealth, not how many billionaires we have, but how many people can access how wide a range of goods and services with their own money.  The market described above is necessary and sufficient to create a world in which that range is widest.  A world in which one can afford his own range of needful things is one of peace and prosperity.  No better guarantee of justice.

Usury is contrary to that creative process, that unitive process.    Usurers hate this process, and proscribe it with such policies as "get big or get out!"  

To loan money at interest is to asymmetrically advantage the lender.  He is able to accrue money and thus power that is exceptional.  Whether loaning at interest to someone in a jam, which is exploitative, or loaning easy money to someone with a winning proposition, the result is contrary to creativity and unity.

It is contrary to creativity because the easy money proposition collects time and talent that would be otherwise available in the market for projects closer to what customers want. It misallocates resources.

It is contrary to unity because the result is the rich get richer and the poor get poorer, denying a natural distribution of goods and services.  The have-nots rightfully resent the haves, even if unaware of their own contribution to the problem, by paying usury.

The solution is not to outlaw usury, only to make it unenforceable, like a gambling debt.  Then the practice would wither away.  No sanctions for failing to pay interest, no debtor's prison for failure to pay a loan.

We will in time see a reinforced statement against usury like we did against selling indulgences at the Council of Trent.  This must occur, for the only alternative is the Church disappears.  There are no other options.  But since the gates of hell will not prevail against the Church, it is only a matter of time before there is a Trent-like emphatic condemnation of the practice.

Let’s just hope the bishops get around to it before there is another split in the church.

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