John Calvin’s Financial Ethic of Usury

By David W. Jones

[Ph.D. Student in Theological Studies (Christian Ethics), Southeastern Baptist Theological Seminary, Wake Forest, North Carolina 27587]

Nearly all economic historians, and even church historians and theologians who have studied the issue, agree that John Calvin’s writings on the subject of usury[1]—specifically his approval of the practice—resulted in a monumental change in the then developing European economy.[2] For example, in his massive two-volume set, An Introduction to English Economic History and Theory, author William J. Ashley noted that Calvin’s writings on usury were a “turning point in the history of European thought.[3] Similarly, theologian Andre Bieler asserted that Calvin’s sanctioning of usury was a “revolution in the history of theology.[4] Likewise, in his study of Calvin, economist Henri Hauser concluded that Calvin’s writings on usury were the “turning point in the economic history of modern Europe.”[5] While these citations seem to indicate, then, a general consensus among scholars that John Calvin’s approval of usury did indeed lead to sweeping changes in European financial theory and practice, there is no unanimity of thought as to why Calvin chose to break with the church’s nearly fifteen-hundred year tradition of prohibiting usurious lending. Some writers have suggested that Calvin’s turnabout was the result of a profound awareness of the changing world scene,[6] while others have supposed that Calvin’s shift was a consequence of his desire to broach the usury question in terms of the structure of society.[7] It is the contention of this work, however, that the reason John Calvin affirmed the practice of lending money at interest is that, unlike earlier theologians, Calvin assigned the individual believer a place of primacy within his financial ethic of usury. Through a study of Calvin’s writings on usury, this work will attempt to prove his emphasis on the individual believer and show that this emphasis is what led him both to reject the church’s traditional ban on usurious lending and to endorse a structured employment of the practice of usury.

The Church and Usury Prior to Calvin

Before evidence for Calvin’s suggested approach to usury is marshaled, it will be helpful to overview the church’s position on lending money at interest prior to Calvin. While this survey is not exhaustive, it will serve three purposes:

First, it will present evidence to confirm that, in fact, the church did reject the practice of usury prior to the Reformation; second, it will highlight the magnitude of Calvin’s decision to allow for usury in light of the richness of the tradition of the church; and third, it will emphasize the uniqueness of Calvin’s emphasis on the individual in contrast to the financial ethic of his predecessors.

In short, the church as a whole officially rejected the idea of usury from the earliest centuries of Christianity until the start of the Reformation. It is significant that no church father—whether Apostolic, Ante-Nicene, Nicene, Post-Nicene, or Medieval—permitted the practice of unbridled usury.[8] The list of church fathers who opposed the habit of lending money at interest is quite impressive. It includes: Clement of Alexandria, Philo, Tertullian, Origen, Cyprian, Apollonius, Lactantius, Commodianus, Hilary of Poitiers, Athanasius, Basil the Great, Gregory of Nyssa, Gregory of Nazianzus, Ambrose, John Chrysostom, Jerome, Augustine, Cyril of Jerusalem, and Leo the Great.[9] While these men each addressed the issue of usury at a different time and in a different setting, it is important to note that their collective arguments against usury are similar in that they tend to center around a mechanical reading and employment of the Old Testament prohibitions of usury without regard to New Covenant applicability.[10] A passage from the writings of Augustine may be cited as a prototypical example of the church fathers’ approach to usury. In his Expositions on the Book of Psalms, Augustine proclaimed:

Lend not money at interest. Thou accusest Scripture which saith, “He that hath not given his money upon usury” [Ps. 15:5]. I wrote not this: it went not forth first from my mouth: hear God.. .. Perchance he who speaketh to thee [discouraging usury], lendeth not at interest: but if he do so lend, suppose that he doth so lend; doth He who speaketh through him lend at interest? If he doth what he enjoineth thee, and thou dost it not; thou wilt go into the flame.... The hay will burn; but “the word of the Lord abideth for evermore.”[11]

Like the church fathers, the canons of the church councils reveal that no church council permitted usury from the earliest council for which written records exist in A.D. 306 until the Fifth Lateran council in the early sixteenth century.[12] While the various church councils produced slightly differing disciplinary canons in regard to usury, these canons were similar in that they uniformly forbade usury based upon a wooden reading and application of the Old Testament prohibitions. The pronouncement of the celebrated Council of Nicaea (A.D. 325) is representative of the church councils’ corporate judgment on the practice of lending money at interest. The canon from Nicaea reads:

For as much as many enrolled among the clergy, following covetousness and lust of gain, have forgotten the divine Scripture, which says, “He hath not given his money upon usury,” and in lending money as the hundredth sum [monthly interest], the holy and great Synod thinks it just that if after this decree anyone be found to receive usury, whether he accomplished it by demanding the whole and one half, or by using any other contrivance whatever for filthy lucre’s sake, he shall be deposed from the clergy and his name stricken from the list.[13]

The scholastic theologians of the twelfth through fifteenth centuries also did not approve of the habit of usury, although their arguments against the practice tended to center more around philosophic proofs than scriptural prohibitions. The most common philosophic argument raised by the Scholastics against usury is that it runs contrary to natural law. This argument, which finds its roots in Aristotle,[14] claims that money, by its very nature, is sterile—that is, it has no inherent power of reproduction. Therefore, the schoolmen taught, to seek to increase one’s net worth through usury without engaging in work, is immoral. The most prominent of the Scholastics, Thomas Aquinas, embraced this philosophic argument as he wrote:

Now, money, according to the Philosopher, was invented chiefly for the purpose of exchange, and, consequently, the proper and principle use of money is its consumption and alienation, whereby it is sunk in exchange. Hence, it is by its very nature unlawful to take payment for the use of money lent, which payment is known as interest, and just as a man is bound to restore other ill-gotten goods, so is he bound to restore the money which he has taken in interest.[15]

Aquinas, and many other Scholastics as well,[16] advanced this proof against usury because it complemented their belief that money involved in a transaction was a mutuum (a loan contract for a fungible). They reasoned, therefore, that usurious lending is wrong because it requires the borrower to make payments on something that does not naturally increase and is usually spent once transferred.[17]

The Wittenberg Reformer, Martin Luther, likewise objected to the practice of lending money at interest. While Luther’s arguments against usury are somewhat difficult to classify,[18] his writings show that he supported the church’s corporate prohibition on usurious lending. For example, in his Table Talk, Luther is reported to have declared, “Manifest usurers should be excommunicated, that is, they should not be given the sacrament... whoever eats and drinks with him makes himself a participant in his sins.”[19] Likewise, in a letter written to Gregory Brück, Chancellor of Saxony, Luther noted that “lending money at interest... is un-Christian.”[20] In light of these citations, it seems safe to agree with scholar David Wright that “Luther, in fact, instinctively perpetuated the patristic and medieval consensus against usury.”[21]

Prior to Calvin, then, the church was almost unanimously united in its condemnation of the practice of usury. In general, this ecclesiastical prohibition rested upon two pillars: First, there were the arguments of the church fathers and church councils which tended strictly to apply the Old Testament ban on usury to New Testament believers; and second, there was the philosophical argument championed by the scholastic theologians regarding the sterility of money. The employment of both of these methods of evaluation prior to the Reformation had resulted in a ban on usury within the church. This was the world in which Calvin found himself as he took up the question of usury.

Calvin’s Approach to Usury

In his excellent article, Calvin and the Social Order; or, Calvin as a Social and Economic Statesman, scholar C. Gregg Singer noted, “In the strictest sense of the word, Calvin was neither an economic or social theorist.”[22] Indeed, this is an astute observation as less than fifty pages of Calvin’s entire corpus are related to economics,[23] and almost every mention of usury within Calvin’s writings occurs in the context of personal exhortation or guidance, not social theory. In light of the thorough studies that have been done in the last century regarding the effects of Calvin’s financial ethic of usury, especially in regard to capitalism,[24] perhaps it is surprising to note this paucity of material. Nevertheless, a survey of Calvin’s financial writings reveals that although his thoughts on usury are limited to four personal letters,[25] material contained within four of his commentaries,[26] one passing remark in the Institutes,[27] and several incidental references in his theological treaties,[28] there is more than enough information available to demonstrate that his emphasis on the individual in regard to the practice of lending money at interest. The following examination of Calvin’s financial material on usury will be organized around three main headings: Calvin’s rejection of the ratio Aristotelis, Calvin’s interpretation of the Scriptural prohibitions on usury, and Calvin’s regulation of the practice of usury.

Calvin’s Rejection of the ratio Aristotelis

Although the church and other Reformers, including Martin Luther, accepted the philosophical argument against the practice of usury summarized in the phrase nummus minimum nonparit (money cannot beget money),[29] a reading of Calvin’s economic writings reveals that he completely rejected this argument. For example, in his first letter on usury written to Claude de Sachinus on Nov. 7, 1545, Calvin asserted:

The reasoning of Saint Ambrose and of Chrysostom, that money does not beget money, is in my judgment too superficial.. .. [I]s not money more fruitful in trade than in any other form of possession one can mention? ... How do merchants derive their profit? By their industry. ... But whoever asks a loan of me does not intend to keep this money idle and gain nothing. The profit is not in the money itself, but in the return that comes from its use. It is necessary then to draw the conclusion that while such subtle distinctions appear to have some weight, they vanish on closer scrutiny, for they have no substance.[30]

In a similar passage in his Commentaries on the Four Last Books of Moses, Calvin declared, “Nor will that subtle argument of Aristotle avail, that usury is unnatural, because money is barren and does not beget money; for ... [a merchant] might make much profit by trading with another man’s money, and the purchaser of a farm might in the meantime reap and gather his vintage.”[31]

While these citations from Calvin’s works show that he rejected the standard philosophical argument against usury, these quotations also serve to highlight Calvin’s own emphasis on the individual. Note that Calvin did indeed realize that in the strictest sense of the word money is sterile in that it does not reproduce itself, for at another point in his letter to Sachinus Calvin admitted, “Certainly if money is shut up in a strong-box, it will be barren—a child can see that.”[32] Yet, Calvin also realized that when an individual, such as a merchant or farmer, borrowed money and invested and worked with it,[33] the potential existed for the capital to grow. As Calvin himself said, “The profit is not in the money itself, but in the return that comes from its use.”[34] In other words, Calvin realized that in the real world money can be just as fruitful as goods or property when personal effort is factored into the economic equation. Therefore, Calvin, unlike the theologians who came before him, rejected the ratio Aristotelis based upon his consideration of the individual in his financial ethic of usury.

Calvin’s Interpretation of the Scriptural Prohibitions on Usury

A second area of Calvin’s financial ethic of usury in which his emphasis on the individual can be seen is in his interpretation of the scriptural prohibitions of usury.[35] A reading of Calvin’s comments on the biblical ban on usurious lending reveals that he did not interpret this material as did previous theologians. For example, in his commentary on Deut. 23:19–20, Calvin wrote, “If, then, we consider this question, whether all usury is permitted, we must not so much look upon the word usury, but upon the intention of God.”[36] Likewise, in his commentary on Ezek. 18:8, Calvin asserted:

If then we wish to determine whether interest is unlawful we must come to the rule of the law which cannot deceive us.... [W]e must remember that we must regard the subject matter rather than the words.. .. [T]he substance ought to be weighed, because the words alone will not enable us to decide whether interest be sometimes lawful or not.. .. We must not play upon words, but treat the real point.[37]

Although some scholars have focused on statements such as these within Calvin’s corpus because they seem to indicate that Calvin was not a biblical literalist,[38] these citations are important to this study in that they illustrate the primary reason why he did not follow the church fathers and councils in their blanket endorsement of the Old Testament prohibitions of usury—that is, Calvin was not interested in a cold observance of the letter of the law, but rather with teaching individuals how to live in obedience to the will of God by arriving at the “real point” and discerning the “intention of God.”[39]

In regard to lending at interest, for Calvin, this desire to get at the real meaning of the text led him to interpret the scriptural prohibitions of usury in terms of the individualistic themes of equity (justice) and charity. Since in his text, The Concept of Equity in Calvin’s Ethics, Guenther Haas has capably proven Calvin’s tendency to interpret the scriptural prohibitions of usury with a hermeneutic of equity and justice, there is no need to construct a defense of this practice here,[40] although several examples from Calvin’s writings may be cited. For instance, in reference to Exod. 22:25, Calvin wrote:

When we come to an accurate decision as to the thing itself [usury], our determination must be derived from nowhere else than the universal rule of justice, and especially from the declaration of Christ, on which hang the law and the prophets, ‘Do not unto others what ye would not have done to yourselves’ (Matt. 7:12).. .. But if we would form an equitable judgment, reason does not suffer us to admit that all usury is to be condemned without exception.[41]

In reference to Deut. 23:19–20 Calvin remarked, “The law of Moses was political, and should not influence us beyond what justice and philanthropy will bear.”[42] Again, in his writings concerning the prohibition of usury at Ps. 15:5 and Ezek. 18:13 Calvin noted:

It seems, then, from these two places that usury is in itself unlawful. But because God’s law embraces complete and perfect justice, we must hold that interest, unless it is opposed to God’s law, is not altogether to be condemned. ... I think their declarations ought to be judged of by the rule of charity; and therefore that only those unjust exactions are condemned whereby the creditor, losing sight of equity, burdens and oppresses his debtor.[43]

It is certainly demonstrable, then, from Calvin’s interpretation of the scriptural prohibitions of usury, that he assigned the individual believer a place of primacy in his financial ethic of usury. The personal principles of equity and charity are clearly visible in the above cited passages. In fact, allusions to the themes of equity and charity are so common in Calvin’s financial writings that more than one writer has described his financial ethic of usury as simply an implementation of the Golden Rule.[44]

Calvin’s Regulation of the Practice of Usury

One final area of Calvin’s financial ethic of usury in which his emphasis on the individual may be seen is in his attempt to regulate the habit of lending money at interest. While it may be possible to conclude from a study of Calvin’s comments on the scriptural prohibitions of usury that he wholeheartedly approved of the practice as long as equity and charity were maintained, this simply was not the case. In fact, in a letter to pastor Francis Morel written on Jan. 10, 1560, Calvin counseled the clergyman that the “surest and most expedient way [of controlling usury] would be not to enter into such contracts,”[45] and in his commentary on Ezek. 18:8 Calvin noted that habitual usury “is unworthy of a pious and honorable man.”[46] Furthermore, in a letter to an anonymous correspondent dated April 28,1556, Calvin cautioned that sometimes “even the slightest increment may not be demanded on a loan without doing offense to God.”[47] The reason for admonitions such as these was that Calvin realized that usury tends to corrupt individuals. To illustrate, in his 1545 letter to Claude de Sachinus Calvin wrote, “Yet if we permit it [usury] in the least, many under this pretext will take an unbridled liberty which can then be held in bounds by no restriction.. .. With an improper use of usury, cruelty and many evil deceptions are often joined.. .. Indeed, it is a very rare thing for a man to be honest and at the same time a usurer.”[48] Later, in his Commentary on the Book of Psalms, Calvin wrote:

Whenever we concede that something may be lawfully done this way, many will give themselves loose reins, thinking that a liberty to exercise usury, without control or manifestation, has been granted them. ... It is scarcely possible to find in the world a usurer who is not at the same time an extortioner, and addicted to unlawful and dishonorable gain.[49]

While Calvin’s awareness of the propensity of usury to corrupt individuals oftentimes prompted him to declare, “I wish the name itself [usury] were banished from the memory of men,”[50] it was also the impetus for his publication of several rules by which to regulate usurious lending. Calvin’s concern for individual believers is unmistakable in these regulations that he first expressed in his letter De usuris: Jehan Calvin a quelqu’un de ses amys and later reiterated in several of his commentaries. The first and most often repeated precept that Calvin espoused in regard to usury was that it was never to be taken from the poor.[51] For Calvin, this was more than just a keeping of Exod. 22:25; it was a demonstration of charity. Second, Calvin asserted that in charging interest one must never transgress the bounds of equity as defined in the Word of God.[52] Third, Calvin stipulated that in order to be liable to pay interest the debtor must make a profit from the sum that is borrowed.[53] Fourth, Calvin noted that usurious lending ought to be regarded as a public affair, not a private transaction.[54] This would both ensure public accountability and prevent one from being tempted to profit off a neighbor’s need. Finally, Calvin noted that in practicing usury one must never go beyond what the laws of the region permit, for the civil laws have been established for the good of society at large.[55]

Summary and Conclusion

This work has presented evidence suggesting that the reason John Calvin affirmed the practice of lending money at interest is that, unlike earlier theologians, Calvin assigned the individual believer a place of primacy within his financial ethic of usury. First, this work demonstrated that the reason Calvin rejected the well entrenched ratio Aristotelis was because of his consideration of individual effort in regard to the nature and value of money. Second, this work surveyed several of Calvin’s comments concerning the scriptural prohibitions of usury. Here, in Calvin’s remarks, it was shown that the reason why he rejected the seemingly biblical ban on usurious lending was that he interpreted these prohibitions through the individualistic themes of equity and charity. Finally, this work argued that due to his recognition of the tendency of usury to corrupt individuals, Calvin attempted to regulate usurious lending through several rules that, once again, indicate his concern for individual believers.

In closing, it ought to be noted that although Calvin’s ethic of usury radically differed from the position espoused by his forebears, this does not mean that either Calvin or those in the church before him embraced an unbiblical view of usury. Rather, Calvin’s ethic simply represents a shift from an emphasis on the morality of the practice of usury itself, to an emphasis on the individuals involved in the financial transaction. In his article, Developing Moral Teaching, ethicist John T. Noonan summarized this paradigm shift well when he wrote:

If the usury history is looked at as a whole, what is seen to have occurred is that [the ideals of Christian morality] ... were protected for centuries by a rigid prohibition of profit on a loan.... [This prohibition] was eventually eroded, but the basic values it had served were eventually served in time in a better way without the absolute rule. The development focused on the responsibility towards a borrower; for the fixed admonition to seek no profit it substituted his conscience informed by Christian values. The theological analysis moved from a focus on the act of lending and the nature of money—both conceived of as sterile—to the requirements of justice and charity in the interaction of two people.[56]

Calvin, then, ought not to be labeled as the inventor of a new ethic of usury, or as one who consciously sought to espouse a doctrine contrary to that of the accepted position of the church. Rather, John Calvin should be viewed as a man whose work signaled a new emphasis in the evaluation of the morality of usury.

Notes

1. Although in modern times the word “usury” has come to denote “the practice of charging, taking, or contracting to receive, excessive or illegal rates of interest for money on loan,” the term as it is employed within this work is used in accordance with its preReformation definition of simply “lending money at interest.” The Oxford English Dictionary, 2d ed. (1989), s.v. “Usury.”
2. William J. Ashley, An Introduction to English Economic History and Theory, vol. 2 (London: Longmans, Green & Co., 1903), 459.
3. Andre Bieler, The Social Humanism of Calvin, trans. Paul T. Fuhrmann (Richmond, VA: John Knox Press, 1964), 55.
4. Henri Hauser, “L’economie calvinienne,” Bulletin de la Societe de l’histoire du protestantisme francais 84e (1935): 228-29. Translation in Albert Hyma, Renaissance to Reformation (Grand Rapids, MI: Eerdmans, 1951), 452.
5. For example, Jane Douglass noted that Calvin’s theory of usury rested upon his analysis of “the economic situation of Europe.” Jane Dempsey Douglass, “Calvin’s Relation to Social and Economic Change,” Church and Society 74 (1984): 79. W. Fred Graham wrote, “With startling clarity we see Calvin’s recognition of the real world.. .. Calvin was forced ... to relate his analysis to the world in which he lived.” W. Fred Graham, The Constructive Revolutionary: John Calvin and His Socio-Economic Impact (Richmond, VA: John Knox Press, 1971), 88, 90. In addition, ethicist Georgia Harkness spoke of “Calvin’s recognition. .. [of] a change in [the] economic situation.” Georgia Harkness, John Calvin, the Man and His Ethics (New York: Henry Holt & Co., 1931), 206. Also, Roger Mehl asserted that Calvin “was much more turned toward the future than the past, [and] was able to perceive the economic transformations that were coming.” Roger Mehl, Catholic Ethics and Protestant Ethics, trans. James H. Farley (Philadelphia: The Westminster Press, 1970), 26.
6. Henri Hauser, Les debuts du capitalisme (Paris: F. Alcan, 1927), 50.
7. In his text, Faith and Wealth, historian Justo Gonzalez notes that there is some debate over whether Clement of Alexandria truly believed that all usurious loans were immoral. The quarrel centers around a disputed interpretation of one of Clement’s texts that seems to indicate that he may have believed that usury charged to nonbelievers was an acceptable practice (probably based upon Deut. 23:19–20). If this reading is correct, Clement constitutes a rare exception to the total ban on usury espoused by the church fathers. Justo Gonzales, Faith and Wealth: A History of Early Christian Ideas on the Origin, Significance, and the Use of Money (San Francisco: Harper San Francisco, 1990), 225–26. In addition, some writers have noted that Ambrose, in his work De Tobia, suggests that usury is permissible if charged to a pagan. A close examination of his writings, however, reveals that for two reasons this so-called “Ambrosian exclusion” is not much of exclusion at all. First, Ambrose wrote that the reason why Deut. 23:19–20 allowed for usury with a foreigner was because all foreigners were enemies of God. If it was allowable to take up arms against and kill an enemy, reasoned Ambrose, then it was certainly permissible to exact usury from him. Second, Ambrose set two regulations to define with whom a Christian could engage in usury; one, the individual had to be a pagan; two, he had to be someone who was not under Roman law. These two stipulations precluded nearly everyone with whom Ambrose’s readers had daily contact. Ambrose of Milan, De Tobia, in Patriologiae cursus completus. Series Latina, ed. Jaques Paul Migne, vol. 14, Sancti Ambrosii (Paris: Gamier, 1844–1861), 779.
8. For a comprehensive overview of the church fathers’ writings on usury, see Robert P. Maloney, “The Background of the Early Christian Teaching on Usury” (Ph.D. diss., The Catholic University of America, 1969); Robert P. Maloney, “The Teaching of the Fathers on Usury: An Historical Study on the Development of Christian Thinking,” Vigiliae Christianae 27 (1973): 241-65; and John R. Sutherland, “The Debate Concerning Usury in the Christian Church,” Crux 22, no. 2 (June 1986): 4-6.
9. The major Old Testament passages that address usury include: Exod. 22:25; Lev. 25:35–37; Deut. 23:19–20; Ps. 15:5; and Ezek. 18:8, 13, 17. All of these passages are frequently cited by the church fathers. Note that interest is only explicitly mentioned two times in the New Testament; however, and neither occasion directly relates to the practice of usury. These references are found at Matt. 25:37 and Luke 19:23 and are synoptic accounts of the parable of the talents. In addition, some of the ancient theologians also argued that Luke 6:35 (“Lend not counting on a return. ..”) is a prohibition against usury, although the term itself does not occur in this verse.
10. Philip Schaff, ed., The Nicene and Post-Nicene Fathers, First Series, vol. 8, Augustine: Expositions on the Book of Psalms (New York: The Christian Literature Company, 1887–1894; reprint, Albany, OR: Ages Software, 1996), 234.
11. Specific church councils that issued canons condemning usury include the Council of Elvira, Spain (A.D. 306), the Council of Nicea (A.D. 325), the African Council of Carthage (A.D. 348), the Synod of Seleucia-Ctesphon (A.D. 410), the Second Council of Carthage (A.D. 419), the Council of Tours (A.D. 461), the Fourth Lateran Council (A.D. 1215), and the Council of Vienne (A.D. 1311-1312). For a description of the canons of these councils, see Maloney, “The Background of the Early Christian Teaching on Usury;” and Sutherland, “The Debate Concerning Usury in the Christian Church,” 6.
12. Philip Schaff and Henry Wace, eds., The Nicene and Post-Nicene Fathers, Second Series, vol. 14, The Seven Ecumenical Councils (New York: Charles Scribner’s Sons, 1900; reprint, Peabody, MA: Hendricksen, 1999), 36.
13. In his Politics (1.10.1258ab) Aristotle wrote, “There are two kinds of wealth acquisition. One has to do with commerce, the other with household management. The latter is necessary and commendable, but the kind that has to do with exchange is justly disparaged, since it is not natural but is from one another. Hence usury is very justifiably detested, since it gets wealth from money itself, rather than from the very thing money was designed to facilitate. For money was introduced to facilitate exchange, but interest makes money itself grow bigger. (That is how it gets its name; for offspring resemble their parents, and interest is money that comes from money.) Hence of all the kinds of wealth acquisition this one is the most unnatural.” Aristotle, Politics, trans. C. D. C. Reeve (Indianapolis, IN: Hackett, 1998), 18–19. In addition, Aristotle wrote in his Nicomachean Ethics (5.5.1133ab), “And currency has become a sort of pledge of need, by convention; in fact it has its name because it is not by nature, but by the current law, and it is within our power to alter it and to make it useless.” Aristotle, Nicomachean Ethics, trans. Terence Irwin (Indianapolis, IN: Hackett, 1985), 130.
14. Thomas Aquinas, On Law, Morality, and Politics, ed. William P. Baumgarth and Richard J. Regan (Indianapolis, IN: Hackett, 1988), 200.
15. For additional information and examples of the Scholastics’ arguments against usury, see John. T. Noonan, The Scholastic Analysis of Usury (Cambridge: Harvard University Press, 1957); John T. Noonan, “Banking and the Scholastic Analysis of Usury” (Ph.D. diss., The Catholic University of America, 1951); Aaron Kirschenbrum, “Jewish and Christian Theories of Usury in the Middle Ages,” Jewish Quarterly Review 75, no. 3 (Jan 1985): 270-89; and Lester K. Little, Religious Poverty and the Profit Economy in Medieval Europe (Ithaca, NY: Cornell University Press, 1983).
16. Note that many Scholastics, however, did allow usury in a limited number of financial transactions if it was merely compensation for an uncontrollable loss sustained by the lender, although the original loan had to be gratuitous. This type of usury was called damnum emergens (loss arising) and was strictly regarded as payment for an actual break in contract resulting in a loss of money. Interest could not be paid for potential profits that the lender lost due to being denied the use of his money. This was called lucrum cessans (profit ceasing) and was forbidden by most Scholastics because it violated the Aristotelian principle that money is not a source of gain in and of itself. See the editors’ comments in Martin Luther, “Long Sermon on Usury (1520),” Luther’s Works, vol. 45:273–310, ed. Jaroslav Pelikan, Walther Brandt, et al. (St. Louis and Philadelphia: Conconcordia Publishing House and Fortress Press, 1962), 298, n. 145; 307, n. 159 (Henceforth, LW45.298, n. 145; 307, n. 159); Benjamin N. Nelson, The Idea of Usury: From Tribal Brotherhood to Universal Otherhood (Princeton: Princeton University Press, 1949), 24–25.
17. In his text on Luther’s ethics, scholar Dietmar Lage made the observation that “One can speak of Luther’s thought only in reference to a particular time and narrowly denned set of circumstances, for Luther was above all a product of, and always responsive to, his particular environment.” Dietmar Lage, Martin Luther’s Christology and Ethics (Lewiston, NY: The Edwin Mellen Press, 1990), 1–2. This “responsive” or reactionary aspect of Luther’s ethics makes it difficult to classify his arguments against usury, for they were continually changing with his circumstances. A study of the more than twenty works in which Luther condemned usury reveals that while he occasionally used Scripture and the Aristotlean proof to oppose usury, oftentimes he simply reacted against various groups or classes of people (i.e., the Roman Church, the governing authorities, the Reformation extremists, the Jews) by lambasting them for their involvement with the practice of usury. Key works in which Luther addressed the issue of usury include his Lectures on Deuteronomy (LW9), his Long Sermon on Usury (LW45.273-310), his To the Christian Nobility of the German Nation Concerning the Reform of the Christian State (LJF44.123-217), and his Tract on Trade and Usury (45.245-310).
18. LW 54.398.
19. LW 49.52.
20. David Wright, “The Ethical Use of the Old Testament in Luther and Calvin,” Scottish Journal of Theology 36, no. 4 (1983): 481. Note that writer Ian Hart, likewise, concluded, “In his insistence upon a fair price and in his opposition to the payment of interest Luther was in line with traditional scholastic teaching where the pretiumjustum and the ban on usury were well known.” Ian Hart, “The Teachings of Luther and Calvin about Ordinary Work: 1. Martin Luther (1483–1546),” Evangelical Quarterly 67, no. 1 (January 1995): 51.
21. C. Gregg Singer, “Calvin and the Social Order; or Calvin as a Social and Economic Statesman,” in John Calvin: Contemporary Prophet, ed. Jacob T. Hoogstra (Grand Rapids, MI: Baker Book House, 1959), 227. In a similar manner to Singer’s analysis, L. F. Schulze noted that, “Calvin did not speak as an economist but as a theologian. Because his ‘social’ and ‘economical’ statements are most intimately related to his theological work and were a fruit of his exegesis, they can never be correctly understood if they are lifted out of their theological context.” L. F. Schulze, “Calvin on Interest and Property-Some Aspects of His Socio-Economic View,” in Our Reformational Tradition (South Africa: Potchefstroom University for Christian Higher Education, 1984), 225.
22. Hyma, Renaissance to Reformation, 441.
23. No study relating to Calvin’s financial ethic would be complete without mentioning Max Weber’s groundbreaking study, “Die protestantische Ethik und der Geist des Kapitalismus.” (Published serially in Archiv Fur Soziahvissenschaft Und Sozialpolitik 20–21 (1904–1905); available in English as The Protestant Ethic and the Spirit of Capitalism [New York: Scribners, 1930]). In this text Weber postulated that Calvin’s financial ethic was responsible for the rise of the economic theory of capitalism in the West. The “Weber Thesis,” as it has come to be known, is probably the most controversial and oft-mentioned theory relating to Calvin’s financial ethics. For additional information and support of the Weber Thesis, see Nelson, The Idea of Usury; R. H. Tawney, Religion and the Rise of Capitalism: An Historic Study (London: John Murray, 1926); and Ernest Troeltsch, The Social Teachings of the Christian Churches, trans. Olive Wyon, 2 vols. (New York: Macmillan, 1931). For arguments against the Weber Thesis, see Andre Bieler, La pensee economique et sociale de Calvin (Geneva: Librairie de l’Universite, 1959); Graham, The Constructive Revolutionary; Harkness, John Calvin, the Man and His Ethics; and W. Stanford Reid, “John Calvin, Early Critic of Capitalism, Part 1: An Alternative Interpretation,” Reformed Theological Review 43, no. 3 (Sept.-Dec. 1984): 74-81.
24. The first and most famous letter in which Calvin mentioned usury was his reply to Claude de Sachinus dated Nov. 7, 1545. In his inquiry Sachinus asks Calvin, on behalf of a friend, if usury is permissible for Christians. In his response Calvin indicates that, indeed, usury may be practiced by believers. This letter may be found in John Calvin, Opera Quae Supersunt Omnia, ed. G. Baum, E. Cunitz, and E. Reuss, vol. 7 (Brunswick: Braunschweig, 1863–1900), 210 (Henceforth, Opera, 7, 210). The classic and most oft-cited English translation of this letter is contained within Harkness, John Calvin, the Man and His Ethics, 204–7, although more recently it has been translated in John Calvin, Calvin’s Ecclesiastical Advice, trans. Mary Beaty and Benjamin W. Farley (Louisville: Westminster/John Knox Press, 1991), 139–43; and James B. Sauer, Faithful Ethics According to John Calvin: The Teachability of the Heart (Lewiston, NY: The Edwin Mellen Press, 1997), 178–91. A second inquiry regarding usury addressed to Calvin came from John Utenhovius and is dated Nov. 26, 1529 (Opera, 8, 462). In his inquiry Utenhovius asks Calvin if it is legal for Christians to deposit money with bankers in London who were paying an interest rate of ten percent. While no known reply from Calvin exists today, Henri Hauser indicates that Calvin responded in the affirmative. Hauser, “L’economie calvinienne,” 228; see also Hyma, Renaissance to Reformation, 451. Calvin’s third letter on usury was a reply to Francis Morel, pastor of the church at Gien. Morel had written Calvin in order to inquire as to the permissibility of the clergy engaging in usury. In his response, which bears the date Jan. 10, 1560, in its Latin version and is dated two years later in its French version, Calvin indicates that it is best if clergy refrain from usury due to the scandals that often arise (Opera, 10, 263; 14, 245). In his fourth and final letter on usury, which is dated April 28, 1556, and is without an addressee, Calvin again sanctioned the practice of usury, although he urged caution in its practice (Opera, 10, 264).
25. These commentaries are Calvin’s Commentaries on the Four Last Books of Moses Arranged in the Form of a Harmony, trans. Charles William Bingham, vol. 3 (Grand Rapids, MI: Eerdmans, 1950); his Commentary on the Book of Psalms, trans. James Anderson, vol. 1 (Grand Rapids, MI: Eerdmans, 1949); his Commentary on the First Twenty Chapters of the Book of the Prophet Ezekiel, trans. Thomas Myers, vol. 2 (Grand Rapids, MI: Eerdmans, 1948); and his A Harmony of the Gospels Matthew, Mark, and Luke, ed. David W. Torrance and Thomas F. Torrance, trans. A.W. Morrison, vol. 1 (Grand Rapids, MI: Eerdmans, 1972). Calvin’s commentary on the Pentateuch is his richest source for material relating to usury.
26. This reference in the Institutes occurs in book 4, chapter 12, section 22. Here, in a passage on church discipline, Calvin notes that the ancient canons of the church indicate, “No cleric should practice usury or commerce.” John Calvin, Institutes of the Christian Religion, ed. John T. McNeill, trans. Ford Lewis Battles (Philadelphia: Westminster Press, 1955), 1248 (Henceforth, Institutes 4.12.22). Since in this citation it is unclear whether Calvin is affirming the position of the ancient canons or just quoting them, it is safe to agree with scholar Albert Hyma that Calvin “said nothing of the slightest importance about economic theories [i.e., usury] ... in his most famous work, The Institutes of the Christian Religion.’” Hyma, Renaissance to Reformation, 443.
27. While Calvin occasionally mentioned usury in his theological treaties, these references were, for the most part, extraneous. In fact, outside of his letters and commentaries Calvin never once purposely discoursed on the issue of lending money at interest. An example of one of Calvin’s incidental citations to usury can be found in his Remarks on the Letter of Pope Paul HI where he mentioned the Jews who “commit open robbery by their usury.” John Calvin, “Remarks on the Letter of Pope Paul III,” in Selected Works of John Calvin: Tracts and Letters, ed. Henry Bevridge and Jules Bonnet, vol. 1 (Grand Rapids, MI: Eerdmans, 1958; reprint, Eugene, OR: Ages Software, 1998), 310.
28. In his definitive statement on usury, The Long Sermon on Usury, Luther proclaimed, “Charging for a loan is contrary to natural law .... [Transactions involving usury] can scarcely be made without violating natural law. .. you cannot make money just with money.” LW45.292,296,299. Furthermore, in his Table Talk Luther is reported to have declared, “Money is a sterile thing.” Martin Luther, Luther: Letters of Spiritual Counsel, ed. Theodore G. Tappert (Louisville, KY: Westminster/John Knox Press, 1955), 234
29. John Calvin, “De usuris: Jehan Calvin a quelqu’un de ses amys,” in John Calvin: The Man and His Ethics, trans. Georgia Harkness (New York: Henry Holt and Co., 1931), 206. It is interesting to note that in this letter of 1545 Calvin attributed the view that money does not beget money to Saint Ambrose and John Chrysostom, rather than to Aristotle. According to Albert Hyma, Calvin made a similar mistake in his commentary on Deuteronomy published in 1555–56. Hyma, Renaissance to Reformation, 454. It was not until the appearance of his Commentaries on the Four Last Books of Moses in 1563 that Calvin rightly attributed the view to Aristotle.
30. Calvin, Commentaries on the Four Last Books of Moses, 131.
31. Calvin, “De usuris,” 206.
32. Note that while Calvin emphasized the importance of individual work in regard to money, he, nevertheless, held that it was God who sovereignly distributes goods to man-kind and causes financial increase. For example, in a sermon on Deut. 8:14–20 Calvin declared, “We must recognize that as a general principle, that riches come not at all to men through their own virtue, nor wisdom, nor toil, but only by the blessing of God.. .. Though some seem to enrich themselves by vigilance, nevertheless it is God who blesses and cares for them. Though others are rich before they are born, and their fathers have acquired great possessions, nevertheless this is not by accident, but the providence of God who rules over it.” Opera 26, 627. Translation provided in Harkness, John Calvin, the Man and His Ethics, 217. In a similar passage in his Institutes, Calvin wrote, “We must consider that what every man possesses has not come to him by mere chance but by the distribution of the supreme Lord of all. For this reason, we cannot by evil devices deprive anyone of his possessions without fraudulently setting aside God’s dispensation.” Institutes 2, 8, 45. See also Institutes 3, 20, 44.
33. Calvin, “De usuris” 206.
34. In his commentaries and letters Calvin gives significant attention to four different passages that address the issue of usury. These passages are: Exod. 22:25; Deut. 23:19–20; Ezek. 18:8, 13; and Ps. 15:5. Although they were frequently treated by the church fathers, councils, and Scholastics, Calvin did not address Lev. 25:35–37 nor Ezek. 18:17 in his writings. In addition, Calvin’s treatment of Luke 6:35 in regard to usurious lending is limited to the following observation, “This utterance has been wrongly attached to usury.... [This verse] is wrongly taken as a reference to interest.” Calvin, A Harmony of the Gospels Matthew, Mark, and Luke, 196.
35. Hyma, Renaissance to Reformation, 446.
36. Calvin, Commentary on the First Twenty Chapters of the Book of the Prophet Ezekiel, 226–27.
37. For example, after a study of Calvin’s material on usury, author W. Fred Graham determined that “Calvin was not a biblical literalist.” Graham, The Constructive Revolutionary, 91. In a similar manner, in her review of Calvin’s financial morals, ethicist Georgia Harkness wrote of Calvin’s “willingness to interpret the Biblical prohibitions, not in terms of a literal reading.” She later concluded that Calvin “almost ceases to be a literalist.” Harkness, John Calvin, the Man and His Ethics, 206. Speaking of Calvin’s ethic of usury, Guenther Haas likewise proclaimed that Calvin “is not a biblical literalist.” Guenther H. Haas, The Concept of Equity in Calvin’s Ethics (Waterloo, Canada: Wilfried Laurier University Press, 1997), 120.
38. While it is not the intention of this work to explain fully Calvin’s use and interpretation of the entire law, it is worth noting that his method of interpretation in regard to usury is consistent with his method of interpretation elsewhere. In his Institutes in a section titled “Ways to Right Meaning” in a chapter on the moral law, Calvin writes, “We must if possible, therefore, find some way to lead us with straight, firm steps to the will of God. We must, I say, inquire how far interpretation ought to overstep the limits of the words themselves so that it may be seen to be, not an appendix added to the divine law from men’s glosses, but the Lawgiver’s pure and authentic meaning faithfully rendered. Obviously, in almost all the commandments there are such manifest synecdoches that he who would confine his understanding of the law within the narrowness of the words deserves to be laughed at. Therefore, plainly a sober interpretation of the law goes beyond the words; but just how far remains obscure unless some measure be set. Now, I think this would be the best rule, if attention be directed to the reason of the commandment; that is, in each commandment to ponder why it was given to us.” Institutes 2, 8, 8. For additional information on how Calvin incorporates the Old Testament into his ethics, see David Wright, “The Ethical Use of the Old Testament in Luther and Calvin,” 463–85. See also Institutes 2, 7, 12.
39. Haas, The Concept of Equity in Calvin’s Ethics, 117–21.
40. Calvin, Commentaries on the Four Last Books of Moses, 129–31.
41. Calvin, “De usuris,” 205.
42. Calvin, Commentary on the First Twenty Chapters of the Book of the Prophet Ezekiel, 226; Calvin, Commentaries on the Four Last Books of Moses, 132.
43. For example, in his monumental study, The Idea of Usury: From Tribal Brotherhood to Universal Otherhood, author Benjamin N. Nelson wrote that Calvin realized that “the Mosiac and Gospel rules were to be translated in the light of the individual conscience, the equity of the Golden Rule, and the requirements of public utility.” Nelson, The Idea of Usury, 74. In a similar manner, Georgia Harkness wrote of Calvin, “Limited as was his recognition of propriety of interest, he took the question out of the sphere of ecclesiastical restrictions and made it rest on the Golden Rule.” Harkness, John Calvin, the Man and His Ethics, 210. Likewise, in his text, The Scholastic Analysis of Usury, author J. T. Noonan asserted that Calvin “abandons completely the detailed analysis of the scholastics in order to urge one general principle: Follow the Golden Rule.” Noonan, The Scholastic Analysis of Usury, 365.
44. Opera, 19, 245–46. Translation in Hyma, Renaissance to Reformation, 450–51.
45. Calvin, Commentary on the First Twenty Chapters of the Book of the Prophet Ezekiel, 227.
46. Nelson, The Idea of Usury, 80.
47. Calvin, “De usuris,” 204–5.
48. Calvin, Commentary on the Book of Psalms, 219–20.
49. Calvin, Commentaries on the Four Last Books of Moses, 132. In his letter to Claude de Sachinus Calvin wrote, “It could be wished that all usury, and even the name, were banished from the earth.” Calvin, “De usuris,” 205. Likewise, in his commentary on Ezek. 18:8, Calvin stated that “it is to be wished that the very names of usury and interest were buried and blotted out from the memory of men.” Calvin, Commentary on the First Twenty Chapters of the Book of the Prophet Ezekiel, 228.
50. Calvin, “De usuris” 207; Calvin, Commentary on the First Twenty Chapters of the Book of the Prophet Ezekiel, 228; Calvin, Commentary on the Book of Psalms, 220; Graham, The Constructive Revolutionary, 92.
51. Calvin, “De usuris,” 207; Graham, The Constructive Revolutionary, 92.
52. Ibid.
53. Ibid.
54. Ibid. Although Calvin never held public office in Geneva and was not even an official citizen of the city until 1555, the sobering effects of his ethic of usury can be detected in the city’s laws as early as 1538. For example in January of 1538, one of the ruling councils of the city, the Council of Two Hundred, voted that interest rates in the city ought to be lowered to five percent. Again on December 24, 1543, another ruling body in Geneva, the Small Council, ruled that interest taken in wheat and wine should be lowered to five percent. In 1544 the Grand Council of the Bourgeoisie voted to enforce the previous rulings of the Council of Two Hundred and the Small Council. Finally, on May 17, 1547, the General Council approved the five percent interest rate as they declared, “Let no one take usury or profit above five percent under penalty of confiscation of the principle, or being compelled to make other amends according to the exigencies of the case.” Graham, The Constructive Revolutionary, 117–19. For more information on the effects of Calvin’s financial ethic of usury in Geneva, see Mark Valeri, “Religion, Discipline, and the Economy in Calvin’s Geneva,” Sixteenth Century Journal 28, no. 1 (Spring 1997) and E. William Monter, Calvin’s Geneva (New York: John Wiley & Sons, 1967), 217–19.
55. John T. Noonan, “Developing Moral Teaching,” in The Dynamic of Christian Thought: The Villanova University Symposium, ed. Joseph Papin (Villanova, PA: The Villanova University Press, 1970), 214.