You can buy the wine but I’ll keep the refreshment

June 11, 2018 § 5 Comments

A usurer attempts to sell some actual property to a “borrower” while retaining the potential for profit which inheres in that actual property.

The borrower in a mutuum owns the actual property he is “lent”, because the mutuum authorizes him to dispose of or consume that actual property as he sees fit: his obligation to the lender is a personal obligation, independent of what happens to that actual property.  Once a mutuum has been joined the borrower fully owns the actual property and the lender owns nothing at all: the lender merely has the borrower’s personal pledge of some different unspecified property of the same worth, at some time in the future.

But any potential which inheres in actual property is not separable from that actual property.  You can’t sell that wine while retaining that wine’s potential for refreshment.  So another way to think about usury is that it represents an attempt to sell property without really selling it.  The usurer transfers full ownership of the property to the borrower personally, since the borrower’s obligation under the agreement remains however he disposes of that actual property; and simultaneously the usurer insists on guaranteed actual profits (not even just potential profits!) from property he no longer owns.

It is fair to ask, then, if any profits from a mutuum are immoral why would anyone lend under a mutuum?  And the answer is that we should never, categorically, lend under a mutuum in pursuit of financial self interest: mutuum lending is only morally licit as an act of charity or friendship.

§ 5 Responses to You can buy the wine but I’ll keep the refreshment

  • This is precisely how slavery was maintained in the US.

    Jewish merchants “purchased” (i.e. redeemed) the bounty on Africans that was set by their Islamic captors; i.e. they bought their “freedom.” This amount served as the basis (literally, as in an accounting basis) for the asking price of the slaves once they had been transported (on Jewish-owned ships, more often than not) to the New World. That basis formed the “redemption price” which a slave (or a benefactor on his behalf) could pay to “buy” his freedom.

    Usury– and all that flows from it– is a hideous sin.

  • Bedarz Iliachi says:

    I understand and appreciate the point – the lender merely gets the borrower’s pledge. The borrower gets the thing.
    But it is unsatisfying that it is necessary to introduce idiosyncratic usages of very well-defined words. Nobody ever says that a lender “sells” the “loan”.
    Selling is something quite distinct from lending.

  • A Portuguese Man says:

    Could we understand a moraly licit fulfilled mutuum contract as an instance of reciprocal charity?

  • […] the comments to the post below, Bedarz lliachi […]

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