First of all, most people do not know what usury actually is. They think it’s something like “lending at too high of an interest rate.” This is false. The interest rate is irrelevant. Usury is lending for profit. Lending here refers only to personal, unsecured loans. Other contracts that are loan-like, are not usury. For a detailed discussion of what is and is not usury, please see Zippy’s FAQ.
Usury is unsecured personal lending for profit. This is rampant in our modern world. Credit cards, bank personal loans, and even some mortgages (depending on the terms of the contract) are usury. There are a great many people in the financial industry who are usurers by profession. If they can feed their children and be a law-abiding member of society by doing that, how can it be bad? Credit cards may have pitfalls, but surely they can be helpful to those in times of need, right?
To understand why usury is wrong, let me first ask you: Is slavery wrong? Is stealing wrong? What about fraud? All of these things are obviously wrong, so it can actually be hard to justify exactly why they are wrong. Most people now days have such a visceral disgusted reaction to slavery that they can’t even start to put into words why it might be wrong.
One simple way of looking at slavery, stealing, and fraud is to ask: Would you like them done to you? Would you want to be enslaved? Would you want to be stolen from? Would you want to be defrauded? Most reasonable people say “No, I would not.” There are edge cases, like when a desperate man sees slavery as a better way out, or when a falsely merciful man looks the other way while being stolen from, or when a lonely widow enjoys the company of the fraudster, in spite of his lies. But we rightly see these edge cases as just that. They are aberrations to what is normally a simple moral judgement. Don’t enslave people. Don’t steal. Don’t be fraudulent. It’s not rocket science.
But when it comes to usury, we no longer have this instinctive moral intuition. Many generations ago, our forefathers did have this intuition about usury, but somehow we have lost it. In order to try and regain our moral intuitions, lets compare usury with some things we know are wrong. Usury is distinct from slavery, theft, and fraud, but it is very similar to all three.
Usury is like slavery, in that it treats another man, and his labor, as personal property. In slavery, the slave is the personal property of the master. In usury, the borrower’s future earnings become the personal property of the lender. Who legally owns your self? You. Who legally owns the product of your labors? You. In slavery, you are sold. In usury, your labor is sold. Both usury and slavery are offenses against the personal dignity of all mankind. By treating man as a tradable commodity, we offend the dignity due him as an image bearer of God. By treating man’s work as a tradable commodity, we offend the dignity due to him as an image bearer of God. Usury is not the same exact thing as chattel slavery, but they are both wrong for very similar reasons. They are both ways of treating people less like people, and more like things.
Usury is like theft, in that it unjustly transfers wealth. In theft, the property does not belong to the thief, because he did nothing to justify having it. In usury, the profit does not belong to the lender, for the same reason.
Usury is like fraud, in that it takes advantage of someone’s lack of understanding in order to get him to give up what is rightfully his.
Usury is wrong, because it is selling something that does not exist. The usurer lays claim to some thing in the future. But the future has not happened. The future does not exist yet. No one can predict the future perfectly.
Usury is wrong.