USURY

I always pay attention when people in the news (particularly politicians) attempt to use the Bible to suit their agendas. Many of us should actively evaluate whether they are using it properly (my experience: they hardly EVER use it properly).

Today’s case in point: Alexandria Ocasio-Cortez (AOC) recently said, “Usury – aka high interest – happens to be explicitly denounced in the Bible (& in many other religions)” to support her agenda for a 15% rate cap on interest rates on consumer loans. Let’s check it out.

She is correct that the Bible explicitly denounces usury. It is lawful to charge interest (Deut. 23.20). Psalm 15.5 praises the godly person who lends his money without usury. But Proverbs 28.8 is explicit in saying, “He who increases his wealth by exorbitant interest amasses it for another, who will be kind to the poor.” According to Proverbs, the preeminent principle for business is honesty (11.1; 16.11; 20.10). We are supposed to keep an eye on business people, and especially retail merchants, because we’re not supposed to be stupid enough to blindly trust them all. Trust has to be earned. We are warned against securing loans for other people (6.1-5; 11.15; 17.18; 20.16; 22.26-27; 27.13; 28.8). The Bible is OK with lending to people in need as long as the rate is fair (Ps. 112.5; Lk. 6.34-35). But what is a fair rate is what varies from culture to culture and era to era. The Bible never sets what a fair level of interest would be.

In the Roman world, interest rates sometimes ran as high as 48%, and that was considered by many in their culture to be unfair (usurious). Seems like a no-brainer that that wasn’t and never would be fair. In the days of Hammurabi, there was a cap at 20%. In 2011, the average American credit card interest rate was 16.82%; in 2018, it was 16.46%. AOC wants to put a cap at 15%.

The cost of debt should be reasonable. The lender should be able to earn money from it, but the amount shouldn’t be so high that the borrower can never get out from under it. What is that rate supposed to be? The Bible doesn’t say. It is up to us, in our time and culture, to discern what is fair to both the lender and the borrower.

About the author: JimWalton

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