January 21, 2015 § 13 Comments
The usurer says, Care for my property and pay me for the opportunity. Keep it intact. Make good every loss and return to me an increase which you by your energy and effort may produce.
Not only does financial slavery exact more labor for the amount invested, but it is more heartless than chattel bondage. The master had a personal interest in the slave he bought. His health and strength was an object of his care and his death a great loss. There was also often a mutual affection developed, as is sometimes found between a man and his horse or affectionate dog. There was sometimes real unfeigned mutual love. The master had a tender care over his slaves in their sickness and in their decrepit age, and sorrowed at their graves. The slaves were inconsolable in their grief at the death of their master.
The usurer has no personal interest in his slave. He has no care for his health or his life; they are of no interest to him. He may live in a distant state and has no anxiety about those who serve him. Their personal ills give him no concern.
Many faithful, industrial and honest borrowers are unable to return the loan. It is as difficult to retain property as it is to earn it. New inventions, new processes, new methods, new legislation and the changing fashions and customs, often sweep property from the shrewd and careful. “Riches make themselves wings; they fly away.” If for any cause the borrower fails there is scant sympathy from the usurer.
Usury: a Scriptural, Ethical, and Economic View, Calvin Elliott (1902)
January 8, 2015 § 29 Comments
Much bafflement, real or polemical, is made over St. Thomas Aquinas’ claim that money is “consumed in its use” like apples or wine. This bafflement in turn creates a discursive environment in which many people actually or at least polemically fail to understand the moral prohibition of usury, despite its objective simplicity.
Usury, recall, is charging profitable interest on a mutuum loan. A mutuum loan is a loan of something which is, in St. Thomas’ terminology, consumed in its use: anything which is consumed in its use, not just money. Usury is always morally wrong without exception.
The terminology I use in the Usury FAQ means the same thing: what Aquinas refers to as things which are consumed in their use I refer to as things which are agreed to be returned in kind as opposed to in particular. Particular things actually exist; kinds of things are not particular things which actually exist. The idea of $100 or a bushel of wheat is not itself actually $100 or a bushel of wheat.
The reason that what is loaned under a mutuum (which is only morally licit as a gratuitous act of friendship or charity) must be returned in kind, as opposed to in particular, is that what was originally loaned in particular has been consumed in the pertinent sense. In a mutuum it was loaned for the very purpose of consumption in the pertinent sense (otherwise it is not a mutuum). What was originally loaned is consumed by the borrower, used up and departed from his estate, and must be replaced by something else – something else of that kind, but not that particular thing, which is gone – in order to repay the loan. The fact that the mutuum borrower does not possess the actual thing that he owes back to the lender demonstrates that any rent charged (interest) is rent charged for no thing, nothing.
In a non-mutuum contract, the borrower (recipient of investment funds) always does possess everything – every actual thing – that the lender (investor) is owed, by definition. The non recourse home mortgage borrower really does possess the actual house, and if he stops making payments the non recourse lender can exercise his foreclosure rights and claim his agreed share of the actual property.
Because a mutuum loan terminates by definition in the borrower’s personal guarantee to repay the principal in kind, that personal guarantee – which is not itself a piece of property which can be bought and sold independent of particular persons – is no actual thing but is, unless reciprocated under purely gratuitous terms of friendship, just a piecemeal enslavement of the borrower.
So in a financial transaction X is consumed, in Aquinas’ terminology, whenever the borrower either literally consumes it himself or exchanges it for something else. The point is that the original actually lent things are gone from both the borrower’s and the lender’s possession; and that is all that matters for the rest of the usury doctrine to follow. The borrower may (or may not) now possess whatever was purchased with the loan proceeds, but the money itself is no longer in the possession of either party. Unless the lender’s contractual rights terminate in something named and specific that the borrower actually does possess, any “rent” he attempts to charge in the form of interest is, literally, a rent payment for nothing.
What the mutuum borrower owes back to the lender is by definition not a specific thing: it is no thing, nothing.
And it is intrinsically immoral to charge rent – interest – for what is literally nothing.
Those who disagree, who think that the idea of a house is as real as an actual house, are welcome to rent one of my imaginary houses. You can send the rent to the Little Sisters of the Poor.
January 1, 2013 § 8 Comments
“Are we not ashamed to pay usury? Not contented within the limits of our own means, we do by giving pledges and entering into contracts, fabricate the yoke of our slavery.” – Plutarch
In applying the Simple Usury Test it becomes obvious that the critical distinction between usurious lending and non-usurious lending is collateral. If the loan is secured by specified tradable collateral and only that specified tradable collateral, with no further moral or legal obligation beyond surrender of that collateral on the part of the borrower to repay principal or interest, it is not usury. This naturally shifts the focus to what constitutes legitimate tradable collateral, and commenter Antonym points out that in the past the custom of selling onesself into slavery to pay off a debt was common practice. If it is not intrinsically immoral to sell onesself into slavery, even in the most desperate of circumstances, it seems to follow that no lending contracts are usury.
An economic libertine has no principled way to oppose the practice of selling onesself into slavery, because for an economic libertine the essence of the justice of a contract is mutual consent: if the contract is mutually consensual that is sufficient for it to be “permitted”, that is, enforced by the police, courts, bully pulpit and guns of the government. So it is perfectly natural for economic libertines to fail to see what is unjust about usury.
I would suggest (perhaps counterintuitively) that it is not intrinsically immoral to sell onesself into slavery in desperate circumstances; but at the same time, it is intrinsically immoral for a lender to take usury on a loan. The reason is because the person who commits the intrinsically unjust act is the one who purchases and takes possession of the chattel slave (whether from the enslaved himself or from someone else). In the case of usury the person who commits the intrinsically unjust act is the lender who takes usury on the loan, not the borrower who acts out of desperation. The act of the borrower is asymmetrical to the act of the lender, as the act of the victim is always asymmetrical to the act of the criminal.
Now, this is not a blanket permission slip to sell onesself into slavery nor to borrow from a usurer on a whim. It is merely a conclusion that neither action is intrinsically immoral, and therefore may be justifiable in some circumstances under some rubric of material cooperation with evil. The work involved in justifying a particular act of material cooperation with evil – or concluding that it is not justified – always depends on the particular circumstances.
St. Thomas Aquinas gives us his view of the matter (ST II-II, Q78, A4):
I answer that, It is by no means lawful to induce a man to sin, yet it is lawful to make use of another’s sin for a good end, since even God uses all sin for some good, since He draws some good from every evil as stated in the Enchiridion (xi). Hence when Publicola asked whether it were lawful to make use of an oath taken by a man swearing by false gods (which is a manifest sin, for he gives Divine honor to them) Augustine (Ep. xlvii) answered that he who uses, not for a bad but for a good purpose, the oath of a man that swears by false gods, is a party, not to his sin of swearing by demons, but to his good compact whereby he kept his word. If however he were to induce him to swear by false gods, he would sin.
Accordingly we must also answer to the question in point that it is by no means lawful to induce a man to lend under a condition of usury: yet it is lawful to borrow for usury from a man who is ready to do so and is a usurer by profession; provided the borrower have a good end in view, such as the relief of his own or another’s need. Thus too it is lawful for a man who has fallen among thieves to point out his property to them (which they sin in taking) in order to save his life, after the example of the ten men who said to Ismahel (Jeremiah 41:8): “Kill us not: for we have stores in the field.”
 Someone who purchases a slave in order to gain his freedom is clearly doing something categorically different, since the purchaser does not ‘take possession’ of the ‘slave’ in the pertinent sense.
June 19, 2008 § 13 Comments
Francis Beckwith points out that there is a non-trivial difference between working for the abolition of slavery and hoping to keep slavery safe, legal, and rare.
I wonder how many people think that we could vote for a member of the KKK for President on some kind of ‘least bad outcome’ calculus, without that vote saying something profound about ourselves, far more profound than its vanishingly small capacity to affect the actual election outcome?
January 18, 2008 § 3 Comments
I posted the following in a combox earlier today:
Another thing about slavery: slavery is just a particular and highly institutionalized instance of treating human beings as property. Human beings can be and often are treated as property without a formal institution of slavery, which doesn’t stop being evil simply in the jettisoning of its institutional character. And of course treating human beings as property is itself a species of treating human beings as things rather than persons. The servant-slave distinction as we understand it today hinges on exactly this: that the servant is treated as a person subject to a contingent earthly authority, while the slave is treated as nothing but an object the sole purpose of which is to provide utility.
I’ve argued (or at least asserted) in the past that even property shouldn’t be treated as property: that is, that our concept of property has become damaged by modern philosophy, which treats property as things subject to arbitrary will as opposed to things falling under legitimate jurisdiction in carrying out a mandate of stewardship. Modern people detest this idea, because modern people detest the idea that they cannot be God, and they especially detest the idea that they cannot be God even in little circumscribed “personal” domains.
Another thing that strikes me here is that to attempt to be a little tinpot God is to attempt to become the opposite of Christ. Because Christ is perfectly loving, perfectly giving, perfectly humble, incapable in virtue of His perfect goodness of treating a person as a thing. So in attempting to be like God in terms of the dominance of our will over some domain, we make ourselves the opposite of God.
June 15, 2018 § 33 Comments
It is worth emphasizing that personal guarantees on invested capital (usury) are indeed very bad business in entrepreneurship, where capital and labor/expertise come together to produce objectively valuable goods and services. Personal guarantees are a huge red flag that the contracts and capital structure are dysfunctional and should be re-worked before a deal is inked, or that perhaps the deal is no good at all on any terms. It is a naive and foolish business practice to give capital to a business partner under a regime of personal guarantees.
Usury is great business though when the objective is to sell things to consumers (e.g. college degrees in grievance studies fueled by five dollar lattes); things that they cannot afford without selling themselves into slavery, at prices massively inflated by the ready availability of usurious loans.
February 20, 2017 § 45 Comments
Human beings used to be reasonably capable of distinguishing reality from imagination, at least in the boots-on-the-ground world of day to day life. Property at one time referred to something real, something which exists in its own right. Thus property could be possessed, repossessed, bought, sold, stolen, consumed, or destroyed independent of the property’s owner or of any other particular persons.
Then along came widespread acceptance of usury. Liberal modernity counts, as one of its crowning achievements, the destruction of chattel slavery. As with all of liberalism’s putative emancipatory achievements, this is illusory. Rather than freeing humanity from the objectification inherent in chattel slavery, liberalism has merely driven this objectification into the subcutaneous socioeconomic metalayer, implanted it under the skin, making it that much more difficult to see and resist. As always liberalism does not actually “free” us from authority as it pretends to do: it simply makes authority sociopathic.
The old tyrannies could at least be seen out in the open. A man knew where he stood. Now the tyranny comes cloaked as the seductress “freedom”. Liberal tyranny boils up from under layers of flesh, lurks inside clinging to the bones as it gnaws away at internal organs and releases its offal into the body. If paganism, Mohammedism, and Rabbinic Judaism are packs of hyenas harrowing Christendom, liberalism is a cancer that eats away at it from within, an alien embryo feeding on its host as it releases a thousand horrors.
But I digress.
Property is objective, that is, it consists of objects independent of any particular human subject or subjects. Owners are human subjects, human beings independent of any particular property. Take away a man’s property and you still have a man.
You can tell who truly owns what by asking what happens when the music stops: by asking what, at the end of the day, secures each person’s claims. In a recourse mortgage the borrower “owns” the house and the lender owns the borrower, because the lender is contractually entitled to collect deficiencies from the borrower if selling the house does not fully discharge the borrower’s contractual obligations. The situation is even worse than that though, because in the case of taxable real estate the sovereign really owns the property and leases it back to the tenant (whom we deceptively label the “owner”). Real estate “owners”, then, don’t really own the actual property. The sovereign owns the property and what the “owners” really own is exclusive leasing rights: a kind of financial security. That isn’t nothing, but there is much less there than meets the eye. Real estate “ownership” where there are property taxes is a form of lie: what is owned is not land and buildings, but a perpetual and exclusive lease on land and buildings.
Products dependent upon cloud software represent a new, technologically enabled phase in non-ownership “ownership”. Cloud software or “Internet of things” products require a “mother ship” somewhere on the Internet in order to work. Without the mother ship they become literally useless; “bricked” in the vernacular. For example you can spend years of your life producing work with a cloud based – or even just cloud licensed – CAD program, under the illusion that you own at least your own actual work product. You don’t own the software, it is merely ‘licensed’ to you, sure. But in fact you don’t even really own your own work product which you produced with the software using your own hands and mind, because you cannot even continue to access your own work without regularly checking in with the mother ship to ensure that license terms are met . If the terms and conditions change, or the company goes out of business or the mother ship crashes for some other reason, you can’t even access the features of your own “property”; not even your own accumulated work.
Cloud products represent a kind of legalized ransomware. As with usury there is a superficial resemblance to legitimate transactions; in this case a resemblance to having sold or leased you some tools with which you can produce your own work; work which you then own. The work you produce with cloud-based ransomware looks like it belongs to you.
But when the music stops your hammer no longer works, there are no other hammers which will work, and all that you have built with the hammer is hostage to the true owner’s terms and conditions. You were never the owner of your own work product in the first place: you rent your own work at the pleasure of the private party who really owns it.
When philosophical anti-realism invades the domain of property, the distinction between persons and property disappears. This erodes the distinction between persons and objects in spheres beyond property and ownership.
If you would like to see the great dehumanization reversed, I can’t really offer much hope. But I’d be happy to hand you a shovel.
 Nota bene: not physical or merely physical, since physicalism is false.
 At least for as long as the tenant continues to make payments, which can be increased at any time without his agreement.
December 10, 2016 § 23 Comments
The main problem with gay divorce is that you can’t tell which one is the “wife” — who is awarded cash, prizes, and custody — and which one is the “husband,” who gets ejected from the home and sold into slavery to keep the cash and prizes coming.
Though I suppose a reasonable approximation is to assume that the one who files for no fault divorce is the “wife”.
April 24, 2016 § 33 Comments
I don’t have strong views about intellectual property. Modern understandings of property and commerce are perverse, immoral, and unreal. It seems likely that at least some of what IP law sanctions, asserts, and prohibits goes against the natural law. But I haven’t personally done the due diligence required to credibly advance particular arguments about particular laws or practices.
The sovereign is, qua sovereign, the ‘owner’ of certain marketplaces: that is, he sets the terms upon which transactions are permitted and carried out in the marketplaces over which he is sovereign.
Cash – or more specifically, sovereign-issued currency – entitles the bearer to engage in certain kinds of taxable transactions in the sovereign’s marketplaces. (People often use it for non-taxable transactions too, and in other marketplaces owned by different sovereigns: insulin is valuable for barter in trade by non-diabetics).
Fiat currency does not authorize all conceivable transactions, of course: various transactions such as selling yourself outright into slavery are not “allowed” (that is, enforced); and usurious contracts are allowed/enforced but should not be.
Intellectual property, then, is like a lease or easement in the sovereign’s markets. Leases and easements are a kind of financial security, that is, claims against property. A patent permits the patent holder to sell the patented invention in the sovereign’s marketplaces, while forbidding other parties to sell the patented invention. A patent, then, is a financial security; the property against which it entitles a specific claim is the sovereign’s marketplaces.
It is similar to Disney allowing only Starbucks to sell coffee in Disneyland. When you are in Disneyland, you must commercially transact within the rules of Disneyland.
 Modern economists use the label “money” to refer to many essentially different kinds of security: actual paper currency, individual currency-denominated claims against the balance sheets of banks, bank claims agains the balance sheet of the Federal Reserve, etc etc. All mainstream modern economic theories — Austrian, Keynesian, Chicago, MMT, Labor Theory of Value, etc — are metaphysically anti-realist, that is, are disconnected from reality and therefore insane and incoherent. In fact I am not personally aware of any metaphysically realist economic theory (an economic theory which competently distinguishes between imaginary reality and actual reality) at all, mainstream or fringe.
January 19, 2016 § 14 Comments
Let me tell you a story.
Bob and Fred met up with Ted.
(I didn’t say it would be a good story).
Some people can’t tell the difference, or assert that they cannot tell the difference, between reality and make believe. The story is something that I made up, so in a sense it is not possible for me to be wrong about it. If someone says “Bob and Fred did not meet up with Ted” either I am right and they are wrong, or they are just writing fan fiction – a different story from the one I wrote. More subtly, if someone says “Bob and Fred were not walking on a sidewalk!” he is wrong. It is my story, a bundle of concepts I crafted in my own mind, and when I wrote it I was thinking of them meeting while walking on a sidewalk. The object under contention is a story I made up myself; so, again, there is a fairly strong sense in which it is not possible for me to be wrong about its content: though it is possible for me to lie, or to tell a different story from the one I originally crafted — to make a new edition of the story. When an author revises his own story it isn’t that the original is destroyed: it is that he has written his own fan fiction, if you will, making a new and different story out of the old. A new arrangement of some old music is in some sense a new song and in some sense is the original song; but the original song does not cease to exist when a new arrangement is made.
This is why Gandalf is a Maia and Dumbledore is gay in the original stories. Fan fiction is, uh, a different story — but in the original stories Gandalf is a Maia and Dumbledore is gay, unless Tolkien and Rowling are telling lies about their own stories.
Now, I am not presenting a rigorous analytic theory of art or counterfactuals or the relation between implicit and explicit content here, and someone who jumps all over this as if it were a rigorous analytic theory will have missed the point. Just about any theory of make-believe stories will do for my purposes, because the main point is just that reality and make-believe are ontologically different. (This is something that children understand, but it has to be explained to adults). It is of course possible to make fictional characters with the same names as real people and some of ‘the same’ characteristics – though of course they are fictional characteristics in the case of a fictional character, so they aren’t really ‘the same’ characteristics – or even for listeners or readers to mistake fiction for reality.
None of that, I trust, casts even a slight whiff of doubt upon the fact that fiction and reality are ontologically distinct. If we cannot agree that fiction and reality are ontologically distinct, I’ll just tell a story about a nice little padded cell in which you can go live and we’ll call it a day. But be careful, because in the modern world you might get charged real rent for the imaginary padded cell.
The Pythagorean Theorem isn’t just some story that Pythagoras made up, because if it were something he just made up then it wouldn’t be possible for him to get it wrong. Understanding the Pythagorean Theorem would just be a matter of understanding whatever Pythagoras wanted it to mean, and the theorem would imply only what Pythagoras agrees that it implies in his story. A historical account of real events can be more or less accurate and complete (though it can never be, um, completely complete); but historical accounts are not the same kind of thing as make believe stories. Historical accounts make reference to real persons, objects, and events; fictional stories make reference to fictional persons, objects, events, aliens, creatures, magical powers, and authorial gods of the different universes standing behind the fourth wall making the fictional universe in their own image and to their own liking.
Whatever else may be the case, when we are talking about reality it is a different kind of discussion from when we are talking about make-believe. When Aquinas and Spinoza disagree about God they are not contending over whether Dumbledore is or is not gay, flitting equivocally back and forth between some original story and fan fiction, changing universes from one in which the original author is ‘god’ to one in which the reader or writer of fan fiction is ‘god’. When Aquinas and Spinoza disagree about God they are disagreeing about God, not writing two different fan fictions in which the God-character of one story isn’t really the same character as the God-character in the other story.
God actually exists, is indeed the grounding of all existence.
Folks who insist that when Mohammedans refer to God they are not referring to God have become confused, or perhaps in some cases are sowing confusion for rhetorical purposes, about the difference between reality and make believe. It isn’t that Mohammedans don’t believe in God, despite having a highly defective concept of God: it is that anti-realist ‘not the same God’ critics themselves don’t believe in God, God as real not just a character in a story. They have confused the world of concepts for the reality which those concepts are about. They have become trapped in their own stories, unable on their own terms to make reference to reality outside of the fan fiction written by the post cartesian mind.
An atheist who (incorrectly) believes God to be fictional might view the Christian and Mohammedan “Gods” to be different characters: one character written by Mohammedan fans, and a different character written by Christian fans. He can view things that way because he is an atheist: he believes God to be a made up character in a fictional story. (In this sense he himself actually does make reference to God, though, in asserting God’s nonexistence). A polytheist is in the same position as the atheist in this respect: he asserts the existence of gods but denies the existence of God. Someone who grasps that God is in fact real must view this as simply false. The Mohammedan concept of God is very wrong: very different from the truth. (So is the Calvinist concept of God, for that matter). But that doesn’t make it about a fictional character.
When folks attempt to apply post cartesian anti-realism consistently they tend to become trapped inside their own theories. Rather than subordinating their theories to reality they become positivistic: refusing for example to believe in authority despite being presented with the counterexamples of property owner and parent. Because their theories don’t explain the ontological/deontological existence of intangible things like mathematics, love, loyalty, authority, etc – for example their theories don’t provide them with demarcation criteria giving an algorithm for comprehensively distinguishing all genuine authority from all false authority – they refuse to believe in these manifestly real things at all, and become solipsistically imprisoned in their own minds.
As with all crazy modern doctrines, nobody sane can assert a consistently anti-realist view of everything. That inconsistency is a feature not a bug.