Mishpatim 5772

When you lend money to My people, to the poor person with you, you shall not behave toward him as a lender; you shall not impose interest upon him. (Shemos 22:24)

The prohibition of charging interest only applies to loans between Jews; a Jewish lender may take interest from a Gentile borrower. This distinction lends itself to misunderstanding. One could mistakenly assume that the Torah only demands fairness and integrity in dealings with other Jews. Gentiles are fair game for deceit and abuse.

This error has become enshrined in the conventional reading of Shakespeare’s classic play, The Merchant of Venice. Shylock – the Jewish moneylender but not the Merchant of the title – has become a virtual archetype of interfaith treachery and ruthlessness. (Although in fairness, we must admit that this may not have been Shakespeare’s intention; in modern productions of the play, Shylock is often depicted in a sympathetic way.)

The correct understanding of this law is provided by Ramban (Devarim 23:20), who explains that a Jew is obligated to treat non-Jews in accordance with the principles of justice. Theft, deception, and fraud of any kind are prohibited. But there is nothing morally wrong with charging interest. It is simply the cost of money, and those who provide money should have the right to charge for it. Nevertheless, one would not charge a family member for a loan for this is a courtesy that relatives routinely extend one another. Jews are meant to regard one another as family and therefore they must lend money gratis.

This concept is perhaps best expressed by a famous Mishna in Pirkei Avos (3:14):

Beloved is man, for he was created in the Divine image; it is a sign of even greater love that it has been made known to him that he was created in the Divine image…

Beloved are Israel, for they are called children of G-d; it is a sign of even greater love that it has been made known to them that they are called children of G-d…

All human beings are meant to be treated with the dignity due to a being created in the Divine image. But Jews – all being children of G-d – are brothers and that special relationship is expressed in ways that transcend considerations of justice.

One added point: The prohibition of interest is not only a refection of group solidarity but it actually promotes group solidarity.

When capital for investment is provided through the traditional channels of usury (the practice of lending on interest), lenders become enriched at the expense of the true creators of wealth – entrepreneurs and laborers. These lenders have no genuine interest in the success of the enterprises to which they lend except to the extent that their loans are secured; their relationship to the enterprises can even be characterized as parasitic (This is one aspect of the Marxist critique of capitalism.)

A system that proscribes usury compels capitalists to become investors in an enterprise rather than lenders to an enterprise. As a result, they now have a vested interest in the ventures in which they invest. The resulting mutual concern strengthens the fiber of the group and ultimately, the entire nation.