Mowing the bread
June 14, 2018 § 11 Comments
Can you licitly contract with a borrower, “I will give you this sack of flour for a sack of the same size plus one dollar, payable tomorrow?”
No you cannot, at least not simply, because this is usury: you are demanding a personal guarantee of more than one sack of flour tomorrow, as payment for exactly one sack of flour today.
What you could licitly do is buy equity in the borrower’s lawn mower for one sack of flour. You could then rent your share of his lawn mower back to him until he redeems it by giving you one sack of flour, or, barring that, the lawn mower.
Of course if a piano falls on the lawn mower you both now co-own, you lose what you invested (in addition to being out the profits). As co-owner of the lawn mower you share in any risks to that lawn mower.
You could buy an insurance bond from Joe against falling pianos, with some of your mower rent proceeds, secured by the product of Joe’s wheat field. But perhaps there would be a drought, etc.
All of which is to say that if the contract is a mutuum, any contractual profit is usury. But if the contract is not a mutuum and in no way contains a mutuum (hidden or otherwise), contractual profits are not usury.