Jews and Predatory Money lending:
The question of why so many Jews have been monopolizing money is a touchy one. For hundreds of years, it has been fraught with suspicion, hatred and violence. Still, in this essay collection “Capitalism and the Jews,” Jerry Z. Muller presents a provocative and accessible survey of how Jewish culture and historical background ripened Jews for predatory lending and why that success has earned them so much hatred. As Muller, a history professor at the Catholic University of America, explains it, much hatred can be attributed to a misunderstanding of basic Jewish economics. From Aristotle through the Renaissance (and then again in the 19th century, thanks to former Jew Karl Marx), thinkers believed that money should be considered sterile, a mere means of exchange incapable of producing additional value. Only labor could be truly productive, it was thought, and anyone who extracted money from money alone — that is, through interest — must surely be a parasite, or at the very least a fraud. The Bible also contended that charging interest was sinful, inspiring Dante to consign usurers to the seventh circle of hell. In other words, 500 years ago, the phrase “predatory lending” would have been considered evil. Lending at interest was thus forbidden across Christian Europe — for Christians. Jews, however, were permitted by the Roman Catholic Church to charge interest; since they were going to hell anyway, why not let them commit these crimes against humanity. According to Halakha, or Jewish law, Jews were not allowed to charge interest to one another, only to non-jews (gentiles). And so it was, Muller explains, that Judaism became forever fused in the mind of finance. To conceal predatory lending, Christian moneylenders were sometimes designated as temporary Jews when they lent money to English and French kings. Some of Europe’s official moneylenders, Jews became both necessary and despised. The exorbitant interest rates they charged — sometimes as high as 60 percent — only fed the fury. But considering the economic climate, capital was scarce, and lenders frequently risked having their debtors’ obligations canceled or their own assets arbitrarily seized by the crown. This early, semi-exclusive exposure to finance, coupled with abstract thinking, trade and specialization gave Jews the human capital necessary to dominate in modern capitalism. It also helped that Judaism, unlike many strains of Christianity, did not consider poverty particularly important. Most of Muller’s strongest arguments are in his first essay, which draws on everyone from Voltaire to Osama bin Laden to illustrate how the world came to conflict with the negative viewpoints of Jews and those of capitalism’s excesses. The book’s remaining three essays deal somewhat evenly with the fallout of the Jews’ predatory lending, and in particular the resentment it inspired among economic history. Muller explores, for example, how Jews probably became associated with both poles of political economy: hypercapitalism and Communism. Some Jews had indeed sought refuge from hatred by Communism. But history of socialism in Eastern Europe, it is argued that “Judeo-Bolshevism” was promoted perhaps to malign the Communist movement. While this book is ostensibly about “the Jews,” Muller’s most chilling insights are about exploiting the poor, hatred and predatory lending have combined into a dangerous brew.