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Neither a Borrower Nor a Lender Be?

Who hasn鈥檛 heard of Shylock? He is perhaps the most famous Jew in all of English literature. His cruel attempt to exact a literal 鈥減ound of flesh鈥 from his creditor Antonio portrays him as a greedy and bloodthirsty Jewish moneylender. When we first meet him in the play he informs us that he hates Antonio not only for his anti-Semitic slurs but also because he lends money for free, rather than charging interest:

鈥淗e lends out money gratis, and brings down the rate of usance here with us in Venice.鈥 (The Merchant of Venice, Act I, Scene III)

But why does Antonio lend money without interest while Shylock is a usurer? Were all Jews moneylenders who took advantage of their Christian clients? This is the popular perception that Shakespeare is building on, despite Jews having been expelled from England centuries earlier. Why did Jews become moneylenders and how did this affect their fate in Europe?

鈥渢he extreme cruelty of Shylock the Jew鈥

Unknown source, Public domain, via Wikimedia Commons

The Mishnah in the fifth chapter of Bava Metzia states clearly that Jews may take interest from non-Jews:

鈥淎nd one may borrow from them [non-Jews] and one may lend to them with interest.鈥 (Bava Metzia 70b)

The Mishnah is based on the verse in Devarim that differentiates between Jews and non-Jews regarding interest:

鈥淵ou shall not deduct interest from loans to your fellow Israelites, . . .

but you may deduct interest from loans to foreigners (谞讻专讬).鈥 (Devarim 23: 20 -21)

While the verses seem to clearly indicate that it is permissible to take interest on loans to Gentiles, the Gemara has a debate about it. Rav Nachman even goes so far as to suggest that not only should Jews not take interest from non-Jews, they should pay them interest. Ravina limits the taking of interest to scholars, not necessarily because he is against usury but because he does not want ordinary people to spend too much time in business dealings with Gentiles:

鈥淲hat is the reason the Sages decreed that one should not lend money to a Gentile with interest? Perhaps the Jew will learn from the Gentile鈥檚 actions. And since in this case the lender is a Torah scholar, he will not learn from the Gentile鈥檚 actions.鈥 (Bava Metzia 71a)

Tosafot at the end of Bava Metzia 70b has trouble with this condemnation of usury to Gentiles. The Baalei Tosafot, living in twelfth century France and Germany, were well aware that Jews often were moneylenders and took interest from non-Jews. Rabbenu Tam explains that today (i.e., the twelfth century) we Jews lend money to Gentiles with interest because otherwise we could not survive. We have to pay heavy taxes and since we live among non-Jews we have no choice but to do business with them and 讜讛讻诇 讛讜讬 讻讚讬 讞讬讬谞讜, it is all because we need to make a living.

How did this situation come about that Jews became moneylenders to the Christian population? It is a popular misconception that usury is ALL that Jews did, this is patently untrue, particularly in the Muslim world and in Spain where Jews were prominent in almost all occupations, from crafts to medicine. But in specific times and places, the Jewish community had fewer options open to them and moneylending and finance became their specialties. This was especially true in Northwestern Europe (France, England, Germany) from the twelfth through the fifteenth centuries.

Jews first come to these frontier communities as merchants and traders. They were known for their financial acumen and they had international ties with other Jewish communities, enabling them to engage in trade, bringing goods and cash to these otherwise primitive economies. But as time passed, the world changed and the Jews struggled to find their place. The Crusades (begun in 1096) made travel much more dangerous for Jews, stopping them from international trading. In addition, the Crusades increased Church power and Christian influence in Europe. Jews were shut out of craft guilds which were open only to Christians. They were often unable to own land since the feudal system required a Christian oath. The Church forbade Christians from engaging in usury. All of these factors made many Jews take the capital that could no longer be invested in trade or land and use it to give loans on interest.

Peter the Hermit leading the People鈥檚 Crusade

Egerton Manuscript, public domain

The other side of this coin, no pun intended, was the need for cash loans in a largely agrarian, local economy. Small loans were made to farmers who had had a bad crop and to families struck by illness or death. Much larger loans were made to princes and kings who were always in need of more money for their military campaigns and other expenses. The Jews fulfilled a much-needed function in this world. Their interest rates were very high: over thirty percent and often more 鈥 and they also engaged in the trade of secondhand objects, brought in as collateral for loans and often ceded to the moneylender in lieu of paying a debt.

The Church and the State had very different approaches to Jewish money-lending. As portrayed by Dr. Robert Chazan in his classic Church, State, and Jew in the Middle Ages, each side had their own priorities. The Church believed in a living but humiliated and poverty-stricken Jew, one who would show the consequences of forgoing belief in Jesus. They did not approve of the Jew becoming rich, certainly not off of Christian believers. They saw usury as a sin, forbidding Christians from taking interest but also disapproving of Jews doing this as well.

The State on the other hand saw the Jewish moneylender as a useful tool, even a partner. Jews were a channel for the prince or the king to get money out of the people without the leader seemingly being involved. Jews would lend money at high rates and then the king would tax the Jews as high rates. They were a conduit to the treasury, bringing in taxes from the people. Jews also kept the economy robust by keeping farms and businesses alive and enabling military campaigns.

Sometimes the tensions between the Church and the State, pushed by popular hatred of Jewish moneylenders, exploded into anti-Semitic decrees and even expulsion. Princes would absolve interest payments or even an entire debt, and sometimes kick the Jews out completely. But after a few years they missed the income and brought the Jews back, starting the cycle over again.

And how did the Jews feel about their position in this triangle? Besides what Rabbenu Tam said 鈥 moneylending was necessary to make a living and survive 鈥 there was another level to their success. As Chazan puts it:

鈥淭he fundamental physical security of the entire Jewish community rested on the economic achievements of its members. . .the key to Jewish well-being lay in the support of the ruling class; and the key to such support lay in . . .Jewish economic achievement. Little wonder then that Jews should have devoted themselves so assiduously to business affairs. (Church, State, and Jew in the Middle Ages, p. 13)

Jews also understood that money makes the world go round. In various polemics with Christians, rabbis explained that without loans, no king could survive and no businesses could continue. And just as no one expects a merchant to give goods away for free, so no one should expect money to be given without interest:

鈥淔or if Nature and Wisdom were to demand that aid be given to everyone who needs it . .聽 and that money be loaned without interest. . .then Nature would also require that if anyone needs a house or a horse or work to be provided for him, they should all be supplied without payment.鈥 (Rabbi Avraham Farissol, (1500), quoted in Haim Hillel Ben Sasson鈥檚 A History of the Jewish People p. 391)

Moneylending exacerbated the already tense Christian-Jewish relationship. It also allowed Jewish communities to thrive and the medieval world to not only survive but to grow and expand. As is often the case in our history, Jews took a difficult situation and turned it to their advantage.

View of a street in Speyer, one of the Rhineland towns built up by Jewish business acumen

Sundar1, CC BY-SA 3.0 <https://creativecommons.org/licenses/by-sa/3.0>, via Wikimedia Commons

Shulie Mishkin

Shulie Mishkin made Aliyah from New York with a Master's degree in Jewish History from Columbia University. After completing the Ministry of Tourism guide course in 1997, she began guiding professionally and has since taught and guided all ages, from toddlers to retirees. Her tours provide a complete picture of the land of Israel and Jewish heritage, with a strong reliance on sources ranging from the Bible to 19th century travelers' reports. Alongside her regular guide work, she teaches "tour and text" courses in the Jerusalem institutions of Pardes and Matan as wel as the Women's Bet Midrash in Efrat and provides tours for special needs students in the 鈥淒arkaynu鈥 program. Shulie lives in Alon Shvut with her husband Jonathan and their five kids. Shulie Mishkin is now doing virtual tours online. Check out the options at https://www.shuliemishkintours.com/virtual-tours
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