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Usury, Natural Law, and the Reformers
Benjamin Nelson

Nelson, Benjamin, The Idea of Usury: From Tribal Brotherhood to Universal Otherhood (Chicago: University of Chicago Press, 1969).

Fascinating history of Usury, showing how medieval doctrine, based on Aristotle and "natural law" more than Scripture, was overturned by John Calvin and the Protestant Reformation, thus baptizing the modern world of usury-finance. From Biblical Brotherhood to Secular Otherhood.

Nelson believes, as did the Anabaptists, that Biblical Law calls for a close community among Christians, who live and work together without interference by envious and power-grabbing non-Christians ("the State") , and does not require an over-specialized debtor-slave economy ("industrialization") dependent upon privileged dispersal of State plunder ("credit expansion"). Nelson and modern man oppose such a free society, and the reader should be alert for disparaging remarks against the relevance and implementation of Biblical Law in society. Nelson also repeats the worn-out notions of Anabaptists as wild-eyed utopians.

In chapter II of his book, "Deuteronomy in Crisis: The German Reformers and the Mosaic Law," Nelson relates the clash between "Anabaptists" who pressed for fuller application of Biblical Law than the Reformers thought politically prudent.

The German Reformation witnessed the outbreak of the modern revolt against the Hebraic and medieval Christian prohibitions of usury. Within less than three decades after the day when Luther stood before the boy emperor at Worms, there occurred a fateful desertion of a principle which had claimed the allegiance of men in the Judaeo-Christian tradition for more than two millennia, the principle that the taking of interest from a co-religionist was utterly antithetical to the spirit of brotherhood. This step was far from being the result of deliberate hostility or indifference to cherished Jewish and medieval Christians ways of conceiving the Lords' design for man. On the contrary, the sixteenth-century revolt against Deuteronomy was set in motion by the fact that in the Reformation, for the first time in the history of Western Christianity, the long-obscured premises of the inherited communalistic ethic were pressed to their ultimate conclusions.

Wherever the evangelical spirit took hold, visionary enthusiasts seized upon the fraternalistic core both of the Pentateuch and the Gospels to project a new Jerusalem, a Christian community so constituted that brothers should have no occasion to take usury from one another. In the critical hour, all of this proved anathema to the leaders of the Reformation (Luther, Melanchthon, Zwingli, Bucer)--a plot to discredit their own plans for a reform sponsored by the accredited civil magistrates. The Reformers met the challenge head on, accusing the extremists of conspiring to pervert the spiritual message of the Scriptures for the sake of their own carnal advantage. The Christian man, Luther cried, was free, under no obligation to observe dead Mosaic ordinances. As for the Gospels, they were not intended to take the place of the civil law or to supplant existing authorities. These utterances mark a milestone in the history of the idea of the Brother and the Other ("other" = "stranger" -- see Deuteronomy 23:19-20 --K.C.)). In circles under the influence of these official leaders, unauthorized attempts to reorganize society in the light of the injunctions of Moses and Christ were henceforth to be dismissed as utopian and, even, anti- Christian.

The Age of Luther and Calvin is the time of Deuteronomy's crisis and demise.

(pp 29-30)

Nelson begins with Luther.

When Luther's declarations are read in their historical contexts, they seem to fall into three periods, marked by notable changes of emphasis.

In the first phase of his mission, he had appeared as the inspired champion of national evangelical revolt.... His program appeared eventually to promise a drastic reorganization of society in the light of the scriptural injunctions to brotherly love."

(pp 31,35)

A.G. Dickens summarizes Luther's early thinking:

In 1520, in his annus mirabilis, (Luther) produced his most famous revolutionary manifestoes. To the Christian Nobility of the German Nation, significantly written in German [rather than in Latin, the language of the intellectuals - K.C.] covers with un-flagging verve the whole gamut of religious, ecclesiastical and social problems. Here Luther attacks the pomp and pride of the Roman Court, the horde of greedy cardinals, papal officials and pluralists, the immunity of priests from secular laws, the papal claims to final interpretation of the Scriptures and to the sole right of calling General Councils. In the universities Luther would drop canon law from the curriculum while greatly limiting the scope of Aristotelian logic and philosophy in favour of languages, mathematics and history. The text of the Bible should be studied without an overlay of theological manuals. Every town should have a school for girls as well as for boys; in both the Gospel of Christ should be the central subject. The concluding passages of this astonishing tractate turn to the laity and show Luther in the role of social-economic reformer. Here he denounces the gluttony and luxury of the moneyed classes, together with the taking of interest. He calls for "a bridle on the Fuggers and such firms" and suggests that Germans should leave the overcrowded world of trade to rehabilitate agriculture. His vision for the new age did not embrace its materialism. In the year 1520, this was indeed an explosive document, and if Luther had written nothing else he would still have become a portentous figure.

Reformation and Society in 16th Century Europe London: Harcourt, Brace and World, 1966, pp. 63-64.

Luther, for all his zeal, did not have a complete program of Scriptural reform. His reforms were at first directed toward those who were charging interest. Regrettably, he neglected as well to direct his preaching against those who broke God's Law respecting the contracting of debt. Biblical Law forbids the Christian from voluntarily contracting debt (Romans 13:8; Proverbs 22:7). Luther, without teaching on the Biblical laws forbidding debt, began teaching on the laws against usury, including those in Deuteronomy. Nelson relates Luther's teaching:

During his first years as a Reformer, Luther had expressed himself with great abandon in the matter of usury. The evangelical character of his successive pronouncements, especially of his two sermons on usury of 1519-1520 had quickened the hopes of interest-ridden debtors. Many who professed to be his followers assumed that he would make no compromise with the civil or canon laws permitting usury, but that he would insist on the literal fulfillment of the word of Scripture.

Luther's left-wing followers took heart from his forceful sermons. Soon they were surpassing Luther in their insistence on the immediate application to the contemporary scene of Mosaic and Gospel teachings on social issues. A brief reference by Luther in his Longer Sermon on Usury to Deuteronomy 15 served (one radical) as a point of departure for a sweeping proposal to adopt the principles of the Hebraic releases of the seventh year as an aid in the elimination of slavery and mendicancy. Presently other evangelically minded preachers were to give new dimensions to the campaign against usury by pushing the Deuteronomic precedents into the forefront of their agitation. The most effective of the radical preachers to launch such a program was Dr. Jakob Strauss, preacher at Eisenach.

The impetuous Strauss opened fire by issuing fifty-one tersely expressed theses against usury. . . . Many peasants and burghers of Eisenach took Strauss to mean that they might at once stop paying charges which were owing to their creditors.11

An imbalance arose from a failure to preach to (would-be) debtors, as well as to creditors.

Early in 1524, Strauss tried to correct the extremist interpretation of his views. At the suggestion of the Duke, he issued a supplementary treatise on usury. . . . Princes are again warned against incurring sin by their enforcement of the payment of usurious extortions. But, Strauss added, he wished now to state plainly that it was not his intention to provoke a revolt against the temporal authorities.

Strauss's counsels to patience seem to have been effective for at least a short time in mollifying the turbulent debtors of Eisenach. From the larger standpoint of the fate of the Deuteronomic ideal, however, Strauss's role in effecting an arbitration of the Eisenach conflict and his subsequent disavowal of the Peasant Revolts are less important than his vigorous affirmation of the authority of the fraternalistic injunctions of the Old Testament. Strauss's (writings were) of the earliest treatises clearly to focus on a problem which was to be of paramount importance in every major crisis of Protestantism in the early modern epoch: What was the proper interpretation and embodiment of the Judaeo-Christian ideal of brotherhood? Or, to put the question in the terms used in the Age of the Reformation, to what extent was Christian Europe bound to emulate the fraternalistic institutions of the Hebrew Commonwealth? 12

Strauss hoped to make the brotherhood of man a social reality. All of God's children, he said, must display their devotion to their common Father by doing unto each the works of love. Evangelical faith was a mockery unless verified in evangelical practice. Early in 1523, in the course of his fifty-one theses, Strauss had attacked Johann Eck and others for proposing equivocal glosses on the fraternalistic injunctions of Deuteronomy xv and Luke vi.24 In Das Wucher zu nehmen, Strauss boldly announced his support of the revival of the principles behind the Sabbatical and Jubilee releases. In the opinion of Strauss, Hebraic social legislation was the foundation of Christian brotherhood. True, Strauss says, some of the superficial details of the laws of Leviticus and Deuteronomy were "ceremonial" in character, and, therefore, anachronistic. He referred primarily to the emphasis on the seventh and fiftieth years. However, it was criminal to say that these commandments were intended only for the Jews. On the contrary, Christ came to fulfill, and not to destroy, these symbols of brotherly love. The releases and the related laws of the Jews were declared to the Jews as indispensable Christians have worked shame in so blithely neglecting them.25

But Luther began to entertain desires of political success, and to ensure the success of his movement, began to pander to the princes and financiers of his day. Nelson chronicles Luther's reluctance to push for too much Biblical Law in society:


The acts and declarations of Luther and Melanchthon during the Eisenach crisis are a turning point in the history of the Deuteronomic ideal. Luther, it is true, at first assumed a friendly and even conciliatory tone to Strauss. In two letters of October 18, 1523, one to Chancellor Gregor Brück,26 of the Saxon court, the other to Strauss himself,27 Luther confessed his underlying sympathy with Strauss's attack on outrageous rent contracts. Luther even pointed to his own record of opposition to this evil. The tone of his personal greetings and salutations to Strauss is cordial. Even his strictures against Strauss are presented with mildness. Yet, the affability of his manner does not conceal the undercurrent of his distrust of Strauss and Strauss's ways.

The first of these letters on the Eisenach crisis contain in embryo the seeds of Luther's subsequent revulsion against everything which savored of Strauss's program and of Mosaic literalism. In both letters, Luther warned the Eisenach preacher against sowing the whirlwind. . . . Strauss was playing a dangerous game (Luther said,) by encouraging the common man to take matters into his own hands. A reform of the (economic situation) was, doubtless, desirable, but it was the common man's duty to wait upon the princes to promulgate a general edict. To allow every man to act as judge in his own case was perilous. It was naive of Strauss to assume there were more than a few Christians in the world 13

Luther has made some good points here. Just because virtually every man, woman, and child in Europe has been baptized, and is, by virtue of his citizenship, a member of the Church(/State), is no reason to assume that any of them are truly regenerated Christians, "Constantinianism" to the contrary notwithstanding. Second, as long as Only part of God's Law is going to be preached (i.e., the demands of God's Law upon the Civil Magistrate) and not the rest (i.e., the responsibilities of the citizens), to preach that interest should not be charged is indeed perilous, just as in our day it is perilous to demand that the Social Security System be abolished when "Christians" give no evidence whatsoever that they will help prevent the death-by-starvation of millions of elderly men and women. But Luther's insistence that Reform wait upon the Magistrate not only raises questions about the Church's duty to rebuke sin in the State, but also backtracks in the progress initiated by the quasiAnabaptist, John Wyclif, who said of his English Bible, "This Bible is for the government of the people, by the people, and for the people."14

Luther's failure to understand the whole of Biblical teaching on economics and the State left him unarmed when it came to dealing with those who would reform the State without reforming themselves. Luther saw their tendencies only as anarchistic. He eventually opted against the peasants in favor of the State, just as Rushdoony would have predicted.15 Nelson continues his account of Luther's abandonment of Biblical Law.

On the one hand, Luther was gratified to find that Strauss had publicly disowned the extremist interpretations of his theses.29 On the other hand, Strauss had aggravated a troublesome issue in laying renewed emphasis on the Sabbatical and Jubilee releases and on the strict prohibition of usury between brothers.30 Luther tried desperately in the months of May , and June to formulate his position on these questions. Under the pressure of the agitation of Strauss and other preachers, Luther was inspired to entertain the idea of getting the princes to a4opt the principles of the Hebraic release.31 In the end, however, as we shall presently see, the disturbing turn of events in the latter half of 1524 forced him to admit his extreme horror of ultra-Mosaism.

Melanchthon seems to have spurred Luther on to effect a decisive reformulation of the official Protestant attitude on the power of scriptural ordinances to bind the Christian con-science. Venturing into Eisenach for a face- to-face disputation with Strauss, Melanchthon opened fire on the legalistic assumptions of Strauss's program. The "law of Christ," Melanchthon contended, was not necessarily to be taken as the basis of the organization of secular society. In the teaching of the Gospel, he said, temporal magistrates were entirely free to rule in accordance with civil laws.32

Luther hesitated to accept Melanchthon's position without qualification. He struggled throughout the years 1524 and 1525 to establish a middle-of-the-road policy on the authority of the "Mosaic" laws. Every one of his utterances of those critical days reveals his indecision as well as his desire to reconcile the antagonistic factions of the Great Revolt. In the end, however, he shut the door against the Mosaic polity.

Luther and Melanchthon dreaded the ultra-Mosaism of the left-wing reformers. In it they detected the harbinger of social revolution. A thousand-and-one new slogans were in the air. Some were pressing for the revival of the Hebrew Shemittah and the Jubilee.33 Others were to declare not only interest taking, but even private property, to be incompatible with brotherly love. In many areas beside Eisenach, extremist elements were to suspend payments of interest charges to creditors.34

Luther and Melanchthon flatly condemned all expressions of popular initiative in putting the Mosaic and Gospel laws .into effect. If there was to be reform, Luther taught, it would have to come from the princes, and not the people. Luther, indeed, appears to have hoped, at one point, that the Emperor and princes would adopt the Old Testament principle of the proportionate tithe in the settlement of the census charges. He became especially active in advocating this measure in the summer of 1524,35 soon after the appearance of Strauss's Das Wucher zu nehmen, when the peasant hosts were gathering. In the new conclusion of his Longer Sermon on Usury completed in the last week in June, he himself recommended the adoption of the principle behind the Jubilee year. Nevertheless, he simultaneously warned the people against taking matters into their own hands. Whatever Christ may have counselled, said Luther, in obvious reference to the situation at Eisenach and elsewhere, the civil authorities were right to use the sword against recalcitrant debtors.36 He insists repeatedly that Christians of the sixteenth century were no more bound by the "judicial laws" of Moses than they were by the ceremonial laws, such as the law of circumcision.37 His private correspondence of 1525, indeed, finds him groping toward the propositions which were to receive their classic expression at the hands of Calvin. The Christian man, Luther was to say, was in the truest sense of the Gospel free to lend his money as he chose. Not the Gospels, but the economic situation and e the considerations of public utility, were of paramount importance in finding clues for the regulation of loans at interest.

(pp. 42-45)

The shift away from Theonomy and towards political compromise was complete, and marks the second phase of Luther's thinking:

2) The second period in Luther's campaign against usury extends from the summer of 1523 to the close of the Peasant Revolts in the winter of 1525. The stormy developments of these two years compelled Luther to institute a crucial modification of his former emphasis. By the close of 1525, he was indelibly stamped as an ally of the territorial princes and of the annuity-owning creditors in their opposition to the demands of the lower classes and their radical preacher leaders.

In the hour of decision, Luther turned his back upon the utopian visions of a New Jerusalem. The cataclysm of 1525 forced him to reveal that he stood four-square against the radical claims that both individuals and government were eternally obligated to observe the Mosaic and Gospel prohibitions of usury.

(p. 35)

In the final phase, Luther is marked by the inconsistency one would expect from a fence-straddling politician:

In these...troubled years, his every act appears to be marked by inconsistency of aim. His private correspondence presents a sharp contrast to his public utterances. At times, indeed, he seems to be working at cross-purposes in the manner of a beleaguered political leader. On the one hand, he appeals to the princes to ' 'follow the law and example of Moses" in a number of crucial particulars. On the other hand, he cuts the ground from under the radical preachers who call for the New Jerusalem (p. 48).

But this inconsistency leads him to statism. Nelson gives us this capsule of Luther's teaching:

[A]ppeal to the Old Testament is utterly misguided. Moses is of no account in the New Testament. Christ puts us, both our bodies and our goods, under the control of the Emperor and the civil law. Speaking for himself, Luther admits that if he were Emperor he might arrange to utilize the example of the Sabbatical and Jubilee releases. Christian rulers may, if they wish, adopt Mosaic regulations, but they are under no obligation to do so.

Rushdoony and Nelson combine to paint an extremely sad portrait of Luther, who moved from dynamic reformer to a man broken by his own compromise. His political ambitions got the best of him, he rejected God's Law, and ended in sadness, haunted by those very Laws which remained written on his heart.

We may follow Rushdoony's pattern and move briefly to Melanchthon whom, as has already been hinted, was more comfortable with pagan political theorists than with God's Law. Here is Nelson's summary, which nicely parallels Rushdoony 's: (pp. 58-59)

Other aspects of Melanchthon's attitude to the usury question are illustrated in his observations on the Mosaic law of the Jubilee. Like Luther, Melanchthon repeatedly proclaims the irrelevance of the Hebrew polity for sixteenth-century Christians. The custom of the jubilee, be concurs, was as peculiarly an ordinance of the Hebrew people as circumcision. Among the Hebrews, the Jubilee had a reason for existence and provided an example of humanity. To insist on transferring that custom to present-day republics is seditious. We are bound only by our own laws, which are compatible with reason and approved by the magistrates.67

Disputing with Strauss in 1524, he issued a similar warning about the Gospel. Political affairs, he insisted, reed not be judged according to the law of Christ. "The Gospel permits us liberty in using civil laws, Roman law, and others, to the extent required for the public peace."68

In the following year, this time taking Aristotle as his text, Melanchthon issued a stronger admonition in the same vein.69 Only the unlearned and the fanatical imagine, he charged, that the Gospel embodies a political doctrine according to which cities must be governed. Politics, like medicine, is a specialized art, entirely consonant with reason, albeit far removed from the Gospel. Preachers ought not to presume to sit in judgment on political issues. Their duty, rather, is to persuade men to obey the civil laws religiously It is as foolhardy for a preacher of the Gospel to interfere in politics as it would be for a theologian to practice medicine. Indeed, ministers are to be deemed seditious who go beyond their function to suggest laws concerning the "division of estates, tributes, contracts, and the punishments of criminals." In this connection, he explicitly accuses Wyclif (1320-1384), Capito (1478-1541), Zwingli, and the Anabaptists of fomenting disturbance.70

Nelson ends his chapter on the German "Reformers" with a look at Bucer:

In Bucer, the Lutheran rejection of Mosaic and medieval legalism is expressed with enhanced self-confidence.

In short, Bucer was the bridge from Luther to Calvin. Now to Calvin himself." (pp. 70, 72)

Nelson on Calvin.

August Lang   

R. J. Rushdoony