That proscription is just wrong, in exactly the way you would expect laws written by uneducated tribal people to be wrong.
There’s nothing wrong with assuming that in the ancient past people were less educated than they are now, and the general claim “religious beliefs are stupid” has been proven to the LW community’s satisfaction. You, though, are making two claims that go far beyond these truisms: (1) that uneducated tribes are stupid in some specifiable pattern X, and (2) that “don’t lend interest” exemplifies pattern X.
I wish you had specified what sorts of errors “uneducated tribal people” are especially prone to making, so that we could evaluate your claims.
In my opinion, Bronze Age agricultural tribes were well-advised not to charge tribal members interest! Because of the vagaries of nature and the low levels of technology, even a hard-working and relatively intelligent Bronze Age yeoman farmer might occasionally need a cash loan to keep his farm running. When he did, there was a decent chance that one of his fellow tribesmen actually would lend him the money at no interest—tribes had an interest in keeping tribal ownership over their land, and if no loan was made, the failed farmer’s land would pass out of the tribe. Because members of the tribe were closely related in terms of genetics, ideology, and social ties, altruism within a tribe was a fairly strong force, and repayment on a zero-interest loan could be effectively enforced with threats of ostracism.
Allowing people to charge each other interest in this scenario would only result in a small increase in the number of hard-working but nevertheless failing farmers who were able to secure loans. It -would- result in a large increase in the number of greedy consumers who would be able to secure loans, because instead of lending to “your brother” out of a sort of tribal altruism, you’re lending to “your customer” for the sake of the interest, or, more accurately, the collateral. Since the discount rate was incredibly high in ancient times on account of how war, plague, and drought were likely to destroy investments and extreme poverty made people ‘impatient,’ the commercial interest rate would also have been extremely high...maybe 200% or 300% on an annual basis even for a reputable lender. There’s no way that most farmers would be able to earn that kind of rate of return, so they would wind up losing the land that they put up as collateral to their creditors. Thus, the main effect of allowing commercial interest would be to concentrate good farming land in the hands of savvy loan sharks.
This seems to me like the kind of problem that’s worth passing legislation to solve.
Obviously, today we think the risk of capital being concentrated in the hands of loan sharks is trumped by the reward of at least some capital flowing to entrepreneurs, and we’re probably right. But in ancient times, there weren’t nearly as many entrepreneurial opportunities—higher transportation costs, slower technological growth, and huge discount rates made most kinds of entrepreneurship impossible.
I don’t see what you are disagreeing with. The proscription is wrong today, however useful it was then, because it was not written by people aware of how things would change in the time since its creation. A god with the power to predict the future could have created a better code, but human beings who didn’t even know what capital was couldn’t be expected to (and, in fact, didn’t).
Your remarks are apt and informative (I upvoted), but PhilGoetz hasn’t actually written anything incorrect, yet. I approve of putting a go stone out to block the common error, but I wouldn’t have worded it as a disagreement.
Well, thanks for your compliments and your upvote.
I don’t say openly that I disagree with PhilGoetz, but I guess to the extent that my disagreement shines through anyway, it’s because I think the particular law he’s chosen is only very weak evidence against religion, whereas he claims it’s very strong evidence.
Granted, an omnipotent, omniscient God could certainly have done far more useful things for the Bronze Age peoples of the Middle East than simply advising “Don’t charge interest;” I like some of sci-fi author David Brin’s remarks along those lines:
Why not open a small trade college and teach our ancestors to pour cement? Well thanks a lot, you alien gods you! Thanks for neglecting to mention flush toilets, printing presses, democracy, or the germ theory of disease! Or ecology, leaving us to ruin half the planet before finally catching on! Hell, if someone had just shown us how to make simple glass lenses, we could’ve done the rest. How much ignorance and misery we’d have escaped!
If a deity were to suggest a ban on commercial interest, though, such a suggestion would hardly be worthless, let alone incorrect, as PhilGoetz appears to claim. A minimally powerful god who could predict the future might have bothered to warn that commercial lending would be required in the future, or she might have figured that it was too much hassle to explain why and when it would be required to a tribe with little concept of scientific history or economics. There is no evidence in the text of the Old Testament that the law against commercial interest was meant to be perpetual; Jewish legislators could and did change it as the basis of the economy changed.
And a great Brin quote (edit: found the link!), too—and on a similar subject, though I wouldn’t normally recommend this book: one of the things I found interesting about Sheri S. Tepper’s novel The Fresco was that it rather undermines several kinds of theodicy by having not-all-that-powerful aliens intervening in a number of quite huge terrestrial problems.
There’s nothing wrong with assuming that in the ancient past people were less educated than they are now, and the general claim “religious beliefs are stupid” has been proven to the LW community’s satisfaction. You, though, are making two claims that go far beyond these truisms: (1) that uneducated tribes are stupid in some specifiable pattern X, and (2) that “don’t lend interest” exemplifies pattern X.
I wish you had specified what sorts of errors “uneducated tribal people” are especially prone to making, so that we could evaluate your claims.
In my opinion, Bronze Age agricultural tribes were well-advised not to charge tribal members interest! Because of the vagaries of nature and the low levels of technology, even a hard-working and relatively intelligent Bronze Age yeoman farmer might occasionally need a cash loan to keep his farm running. When he did, there was a decent chance that one of his fellow tribesmen actually would lend him the money at no interest—tribes had an interest in keeping tribal ownership over their land, and if no loan was made, the failed farmer’s land would pass out of the tribe. Because members of the tribe were closely related in terms of genetics, ideology, and social ties, altruism within a tribe was a fairly strong force, and repayment on a zero-interest loan could be effectively enforced with threats of ostracism.
Allowing people to charge each other interest in this scenario would only result in a small increase in the number of hard-working but nevertheless failing farmers who were able to secure loans. It -would- result in a large increase in the number of greedy consumers who would be able to secure loans, because instead of lending to “your brother” out of a sort of tribal altruism, you’re lending to “your customer” for the sake of the interest, or, more accurately, the collateral. Since the discount rate was incredibly high in ancient times on account of how war, plague, and drought were likely to destroy investments and extreme poverty made people ‘impatient,’ the commercial interest rate would also have been extremely high...maybe 200% or 300% on an annual basis even for a reputable lender. There’s no way that most farmers would be able to earn that kind of rate of return, so they would wind up losing the land that they put up as collateral to their creditors. Thus, the main effect of allowing commercial interest would be to concentrate good farming land in the hands of savvy loan sharks.
This seems to me like the kind of problem that’s worth passing legislation to solve.
Obviously, today we think the risk of capital being concentrated in the hands of loan sharks is trumped by the reward of at least some capital flowing to entrepreneurs, and we’re probably right. But in ancient times, there weren’t nearly as many entrepreneurial opportunities—higher transportation costs, slower technological growth, and huge discount rates made most kinds of entrepreneurship impossible.
I don’t see what you are disagreeing with. The proscription is wrong today, however useful it was then, because it was not written by people aware of how things would change in the time since its creation. A god with the power to predict the future could have created a better code, but human beings who didn’t even know what capital was couldn’t be expected to (and, in fact, didn’t).
Your remarks are apt and informative (I upvoted), but PhilGoetz hasn’t actually written anything incorrect, yet. I approve of putting a go stone out to block the common error, but I wouldn’t have worded it as a disagreement.
Well, thanks for your compliments and your upvote.
I don’t say openly that I disagree with PhilGoetz, but I guess to the extent that my disagreement shines through anyway, it’s because I think the particular law he’s chosen is only very weak evidence against religion, whereas he claims it’s very strong evidence.
Granted, an omnipotent, omniscient God could certainly have done far more useful things for the Bronze Age peoples of the Middle East than simply advising “Don’t charge interest;” I like some of sci-fi author David Brin’s remarks along those lines:
If a deity were to suggest a ban on commercial interest, though, such a suggestion would hardly be worthless, let alone incorrect, as PhilGoetz appears to claim. A minimally powerful god who could predict the future might have bothered to warn that commercial lending would be required in the future, or she might have figured that it was too much hassle to explain why and when it would be required to a tribe with little concept of scientific history or economics. There is no evidence in the text of the Old Testament that the law against commercial interest was meant to be perpetual; Jewish legislators could and did change it as the basis of the economy changed.
Fair enough!
And a great Brin quote (edit: found the link!), too—and on a similar subject, though I wouldn’t normally recommend this book: one of the things I found interesting about Sheri S. Tepper’s novel The Fresco was that it rather undermines several kinds of theodicy by having not-all-that-powerful aliens intervening in a number of quite huge terrestrial problems.