USURY. If the term 'usury' is to be de fined, as in the strictly legal sense, as the illegal profit demanded by a lender for the loan of money or other property, it will be found that this offense society is almost as old as society itself. Even in the earliest of Biblical days, for example, usury was practised so gen erally that the Lord uttered his warning against the custom: ((Thou shalt not lend upon usury to thy brother, usury of money, usury of victuals, usury of anything that is lent upon usury. Unto a stranger thou mayest lend upon usury; but unto thy brother thou shalt not lend upon usury, that the Lord thy God may bless thee' (Dent. xxiii, 19, 20). Until com paratively recent times the word ((usury* had many definitions and was used to embrace sev eral essentially different social phenomena. In the Old English application it denoted any sort of -interest upon money loaned rather than in the more modern signification which has made it applicable only to the unlawful contract ex acting that the loan of money be repaid with exorbitant interest for its use. In fact, if one were to trace the history of the word back through the centuries that have passed since the Mosaic days it would be found that it had as often been applied to the strictly moral and legal methods of procuring just interest for capital invested as to those concerning which a moral if not a legal taint might be attached.
History.— The earliest interpreters of the laws of Moses certainly condemned the illegal practice of usury, and yet they did not forbid the taking of interest in payment for the loan of money, but expressly stipulated that such interest should be charged to strangers. It must be admitted, however, that this reading of the law was largely the result of the social con ditions which existed in Israel at this time. In the first place the Israelities were neither a rich nor a commercial people, and the laws and regu lations under which they lived were apparently not framed with the purpose of enabling them to become so. Their object, therefore, was to maintain their entity as a nation and to pre serve the family inheritances which enabled them to continue happily their frugal mode of life. If the Israelites borrowed, therefore, it
was not with a view to profit or to enable them to improve their condition, but simply from poverty and to secure to them some absolute necessity of life. To exact from such persons more than was lent, therefore, would have been both sinful and unjust. The result is denoted by the fact that among the ancient Israelites loans were made merely in cases in which there were poor persons who required assistance to tide them over present difficulties, and never for the purpose of enabling an avaricious man to increase his wealth at the expense of his poorer neighbor. This restriction, however, did not apply in the case of the stranger who was in need of financial help, and the extortion of usury was one of the several means resorted to by the Israelites to ruin the Canaanites and the other stranger-people who remained in the land.
As time passed the public attitude toward usury underwent a decided change, and society. which had branded all lending as immoral and all interest as 'usury' because the lending had i so generally resulted in cruelty and hardship to the borrower, finally began to feel that all lend ing was moral and honest, and it was under these conditions that the term 'usury' was first applied to every method of receiving interest upon capital invested, an attitude that remained unchanged for many centuries.
One of the most interesting and instructive features in the study of the economic progress of society is that which enables one to follow the various changes that have occurred in the methods of money lending. It has already been shown that the ancient Israelites borrowed only from necessity and not from the possibility of furthering any commercial interest, and this condition, according to Grote, not only pre vailed in Greece, but applied to nearly all parts of Europe during the early Middle Ages.