Debtor’s prison and usury
March 20, 2017 § 43 Comments
A good sovereign will decline to enforce usurious contracts, and will reserve the authority to – if prudentially necessary – punish those who attempt to craft usurious contracts.
It follows that in a good polity, the only way to acquire a magistrate-enforceable personal debt would be by committing a crime (including, possibly, criminal negligence).
I conclude that what makes debtor’s prison bad is acceptance of usury. In the absence of usury, debtor’s prison is just prison for criminals.
Says the chick with the mortgage, LOL.
[…] Source: Zippy Catholic […]
I used to think that the credit card business couldn’t survive and thrive without usury because most people don’t have an asset pool conducive to securing even one credit card to the satisfaction of the company, and then it hit me: they could just require you to take out a bond that is 10% of the total line of credit. Maybe even up to 25% if you have bad credit. Don’t pay your debts? They take the bond and kick you to the curb and that’s the recourse. Problem solved. It would also actually reduce the risk involved, but it would have people shrieking classism.
Without usurious lending though, negative net worth would be virtually impossible. You wouldn’t get an insurance bond unless you still had net skin in the game (or a really stupid insurance provider, which is an intrinsically transitory circumstance).
In the land of negative net worth, the man worth 0 is king.
Not so: Suppose you buy an item, and promise to pay later, or have a workman perform some service, and don’t pay him. No usury involved.
Here is another case: A business supplies goods, and expects to be paid in a month or so. It sells the debts owed to it at a discount to a factor. The factor has to collect the debts. Not seeing any usury involved.
In this case the crime is purchasing services, and not paying the agreed upon price for them at the agreed upon time.
This is all discussed in the usury FAQ:
Zippy. I know this is OT but here is an unexpected source confirming some of your major points about national elections
Couldn’t somebody go to debtor’s prison if they received a charitable no-interest loan with a personal guarantee of repayment, and then failed to repay?
Depending upon the circumstances that is possible, but only if the debtor is committing a form of theft or fraud in withholding repayment — that is, if the debtor is committing a crime.
Note that the magistrate would not compel repayment if repayment were not possible, without undue hardship, using property the debtor does actually own. Given that condition no debtor would really ever be going to prison for being unable to repay a charitable loan. He might go to prison for defying the magistrate and refusing to repay it though. (This is similar to an employer who is able to pay wages owed refusing to do so, or to the buyer of services already rendered refusing to pay even though he is able).
In general every morally licit mutuum is made with the (implicit or explicit) condition that it will be paid – if at all – only when doing so does not represent undue hardship for the debtor. So prison based on a literal incapacity to repay a morally licit charitable mutuum is impossible. Under a just regime there is really no debtor’s prison: only prison for crimes.
Re: Craig N.
Check the parentheses: “including, possibly, criminal negligence.”
We’ve got two basic possibilities, plus a spectrum of others ranging from one to the other:
1) They are, through no fault of their own, unable to repay. If the lender is in fact charitable, he will not have them sent to prison.
2) They are clearly culpable in their failure to repay. This would, I think, qualify as criminal negligence.
Yes, you said it better. “If you find yourself unable to pay this I’ll have you sent to prison” are not charitable terms.
Mutuum loans are only licit as acts of friendship or charity, with all that that implies. If any lender of money or other property ‘for consumption’ accepts a personal guarantee of repayment with different expectations than that, the fault lies with the lender.
What about non-interest bearing debts?
That is what we were just discussing. Could you be more specific?
ps Is there any reason not to ban usurious contracts right away? I mean, would there be any prudential reason not to ban usury (the making of any new usurious contracts)? I cant think of thing that would produce salatary results so quickly as that. Immediately the bonds of charity would be reforged. Talk about “Making America Great Again”!
There is never any reason to not stop evil immediately.
However, there may be a prudential reason to continue to enforce previous usurious contracts; but I believe that reason would be wrong and instead of enforcing such older usury the authority involved may want to backstop them in other ways (such as the government buying said debt and converting them to non-interest loans).
My guess is that there would be significant price deflation in usury-prevalent industries, for example higher education financed by student loans and automobiles with unrealistic loan-to-value ratios backed by personal guarantees. But as Tom suggests, prudential reasons never justify intrinsically immoral actions, in the long term the effects would be salutary, and the sovereign could help to refinance some of that debt under non-usurious terms.
Thank you. I do see the comments on non-interest-bearing loans. (Sorry they were not loading earlier).
FWIW. Four-to-five years ago when Culture Wars was dedicating almost every issue to usury, one of the writers of some of the articles (and participant in the symposium Jones convened in South Bend on this issue) .. an expert on usury who seemingly took a strict position .. Anthony Santelli .. Made a final conclusion that surprised me. It went something like this (paraphrase of a paraphrase): “ideally there would be no usury. But now today since usury is being used as a tool to fight a war, we have to use the tool ourselves to fight back in that war.”.
We must refuse to use the tools of Satan to fight Satan. We cannot be usurers to fight abortion.
“We cannot be usurers to fight abortion.”
This is a good point. The essence of so many of our modern problems all seem to stem from this idea that it okay to treat people as commodities. So abortion and selling of parts is said to be justified because people are just a clump of cells. Usury also seeks to profit off of people’s misfortune.True too of porn, perhaps even of divorce court. The argument becomes incoherent when people can be perceived as non human commodities some of the time, but not at other times. IMO, if we are created in the image of God, then we need to be consistently created in the image of God.
One of the sad things about this whole mess is that we’re so proud of having (more or less) abolished the slave trade, but we’re still committing the same sins. Only now as part of a supersized combo meal with extra obfuscation and a side order of mass murder.
Almost all of the natural moral law can be summarized as “don’t treat people like things.” Or, as someone once put it more positively, “love thy neighbor as thyself”.
One of the sad things about this whole mess is that we’re so proud of having (more or less) abolished the slave trade, but we’re still committing the same sins.
Or the ritual wailing over the Holocaust by people who celebrate the mass murder of babies. While all murder is heinous, it speaks volumes about our priorities that we grieve so much over grown men and women that could have fought like cornered animals, but are so callous toward babies.
It’s another example of what we’ve been talking about – the murders of the Holocaust are horrible because they were active; but everyone ignores the starvations of Stalin because they were passive even though they were both actually acts.
Calvinists make a similar error in their view of sovereignty. They mistake God passively allowing disobedience for something other than a sovereign allowing subjects to be disobedient. A lot of people seem to have a hard time understanding that when an authority allows someone to do something, that is an act of authority equal to any other because they are always “acting” one way or another as an authority.
Well, now you’ve got me thinking there might be something to this whole passive thing. Obviously it wouldn’t apply in cases like Schiavo or abortions, where an authority is actively preventing anyone from helping the victim, but the distinction between the permissive and active will of God is one of the more satisfactory (to me, at least) for the existence of evil, and in any case of sufficient pedigree (back to St. Augustine of Hippo at least) that I’m loathe to dismiss it out of hand.
One possibility is that situations of “passive” or permissive authority allowing an evil really do exist, but many exercises which claim to be aren’t. Or perhaps it is that God permits sin only for a time, and in the end punishes the evildoer? One reason he permits trials and temptations IS to give us a chance to practice charity and obedience; punishment is not eliminated, merely delayed.
Liberalism is a philosophy of human authority. A human authority can be passive with respect to a particular kind of controvertible case to the extent that that kind of controvertible case has never come up before that human authority, had never been considered; so it isn’t as if passivity in human authorities is impossible per se. What is impossible per se is passive acts. Every act of a human authority (every actually considered choice or resolution, including choices to ‘refrain from resolving’ a particular conflict — though as you point out, most of what pretends to be even that sort of case isn’t) — every act of a human authority always and necessarily discriminates and reduces the available possible choices to some subset of possibilities, that is, restricts the freedom of subjects.
How this analogizes to theology may be an interesting question, and it is true that liberalism tends to collapse human authority into an all-powerful monolith: to play God, if you will. But liberalism is a political doctrine, that is, a doctrine of the (putatively) justified exercise of human authority, of justified authoritative acts.
“Or perhaps it is that God permits sin only for a time, and in the end punishes the evildoer? One reason he permits trials and temptations IS to give us a chance to practice charity and obedience; punishment is not eliminated, merely delayed.”
I often see the mercy, grace,and goodness of God at play here, and oddly think of what was done to Rosemary Kennedy. Her father simply arranged for a pre-frontal lobotomy, which ended her ability to do “evil.” Problem solved.
So why does God permit sin and allow us a certain amount of freedom within our aquarium walls? Great love for us and a kind of respect for human dignity, an honoring of our psyches. I sometimes like to quip that God didn’t have to cause Adam to fall into a deep sleep before ripping out Adam’s rib,but He did and that reveals a certain amount of compassion, concern for our comfort and well being, respect for our dignity. And He did that long before humans invented anesthesia.
Another part of it is that God wants us to be like Him; and He wants us to experience the joy of helping others, the joy of suffering for others, the joy of doing God things for others. He wants us to experience giving money to a bum precisely because we don’t control what he does with it which is the way God gives everything.
Zippy and Hrodgar — fair enough.
I was imagining circumstances in which it could come up (and wouldn’t be surprised if you could find actual examples if you dug far enough into medieval & Renaissance Italian history), but there’s always some sort of moral offense involved.
Hmmm… this is an interesting question.
When a human authority is aware of an evil that is occurring, has the power to impede the evil that is occurring, but chooses not intervene – he can not be said to have shown a respect for the human dignity of his subjects. Rather, he chooses to act in a way which allows certain subjects to commit evil and certain subjects to be harmed by that evil. He has shirked his responsibility to direct his exercises of authority toward the common good of his subjects.
Yet when God, who has all the power to prevent every evil if He so desired it, chooses not to intervene in the numerous evils that occur at every second of every day, it would still be blasphemous to claim that God has chosen to act in a way which is contrary to the common good of his subjects/creatures. And as insanitybytes22 points out, it is tempting to attribute God’s non-intervention to His loving respect for us and our capacity to make decisions freely, even when those free decisions are detestably evil.
I find this puzzling. Human authority analogizes rather nicely. The responsibility of a King to his subjects is analogous to the responsibilities of a Duke which is analogous to the responsibilities of a father. But the gap between human and divine authority is far too wide to analogize in this way. For a King to tolerate all kinds of evils out of a “respect for his subjects and their capacity to make decisions freely” would be the height of irresponsibility.
I suppose some people might be inclined to simply say, “Man is not God” but it seems as if there ought to be a more satisfying answer to this conundrum.
Part of it is not direct; the King may tolerate evils of his subjects because he is respecting the authority of those who should correct – so if a father fails to discipline his son and the King doesn’t step in, it can be out of respect for the authority of the father; especially as the King acknowledges that he is not God and may actually be wrong about what the father should do.
However a King who would refuse to give council and advice to his subjects when reasonably asked would seem to have failed, though in a different way. If the father asks the King; the King should council; but perhaps not do the father’s job.
Something something chain of command.
“When a human authority is aware of an evil that is occurring, has the power to impede the evil that is occurring, but chooses not intervene – he can not be said to have shown a respect for the human dignity of his subjects. Rather, he chooses to act in a way which allows certain subjects to commit evil and certain subjects to be harmed by that evil. He has shirked his responsibility to direct his exercises of authority toward the common good of his subjects.”
I think there are many times when not impeding the evil that is occurring is a moral and just response from authority. I was thinking of addiction here, alcoholism,drugs,where really the only moral choice is to cut people loose and let them hit bottom. Exercising your authority can very easily become enabling their entire disease. So rather than shirking responsibility,you are actually placing it where it belongs.
I was thinking too, of a Father standing back and waiting for his kid to figure out how to deal with bullies on his own,or perhaps giving him some advice but not actually intervening himself.
If right liberals respond like this to the prospect of a homosexual getting socked in the face for engaging in homosexual acts in public, one can only imagine how horrified they’d be if a compete authority reinstituted traditional standards of punishment for homosexual conduct. Or more simply… “this is why we can’t have nice things…”
(Like a society where you don’t have to worry about having your throat slit by an Islamic radical outside of parliament, your wife/daughter raped at a train station or your son buggered with the state’s blessing)
I’ve written a new post where the discussion of “permissive will” is more on-topic.
What about the Pope who liked to fight Holy Wars?
Nothing much in earth so clearly a tool of Satan as the Catholic Church.
You even worship Saints and Mary, idolatry.
You believe in purgatory. Why?
Thank Jehovah for men like Martin Luther, the remnant lives on, barely.
Martin Luther loved Mary; why don’t you?
Deus vult! glosoli
Must be Lent.
Every time you pray to an entity other than Jehovah or His Son, Satan giggles. He has you worshipping false Gods.
Every time a Protestant reads the bible and confuses his own opinions for doctrine, God kills a kitten.
Now that we’ve gotten that out of our system, lets try to stay on topic.
Something something chain of command.
Not in the traditional sense because the king, unlike someone higher in a genuine chain of command, does not have the authority to just set aside the direction of a father if it pleases the king. Superiors in a chain of command do.
FYI folks, I am moderating comments in this thread to keep it on topic. Comments which aren’t at least in some way about the subject of the OP are off topic.