From New Dawn Special Issue Vol 10 No 2 (May 2016)
The most hated sort [of moneymaking], and with the greatest reason, is usury, which makes a gain out of money itself, and not from the natural use of it. For money was intended to be used in exchange, but not to increase at interest. And this term usury which means the birth of money from money, is applied to the breeding of money, because the offspring resembles the parent. Wherefore of all modes of making money this is the most unnatural.
– Aristotle (384-322 BCE)1
Aristotle’s definition of usury is perhaps the most cogent ever made. Usury, as originally defined, is any money made from a loan. The Christian and particularly Catholic opposition to usury was founded on the dictum in the Gospel of Luke about giving without expecting anything in return, and on the Old Testament precepts against charging interest.
Opposition to usury seems to have been instinctive in many diverse civilisations and cultures, with an intuition it is something unnatural, parasitic and outright sinful. When a civilisation accepts usury as normal business practice, as does Western civilisation, it is symptomatic of an advanced cycle of decay.
The Vedic scripts of ancient India (2000-1400 BCE) call the “usurer” kusidin, a lender charging interest. Brâhmanas (priests) and Kshatriyas (warriors) were prohibited from practicing usury. The Sacred Laws of the Aryas states:
God weighed in the scales the crime of killing a learned Brâhmana against the crime of charging interest; the slayer of the Brâhmana remained at the top, the charger of interest sank downwards.2
As in the Western and Classical civilisations, the definition of usury was compromised over time. By the second century CE the Laws of Manu defined usury as beyond a “legal” interest rate, after which the interest cannot be recovered. The fact there is now a legal rate of interest, rather than an outright prohibition, indicates compromise of the type that arose in Western Christendom and Classical Greece and Rome. Additionally, like the exemption of the Jews from laws on usury under Mediaeval Christendom, the Hindu merchant caste were permitted trade in usury:
To invest money on interest, to be a jeweller, to tend cattle, tillage and trade – these are declared as occupations for the Vaisya caste.3
Siddharta Gautama Buddha offered a more unequivocal stance:
One discerns wrong livelihood as wrong livelihood, and right livelihood as right livelihood. And what is wrong livelihood? Scheming, persuading, hinting, belittling, and charging interest. This is wrong livelihood.4
Plutarch (46–127 CE), in his essay “Against Running In Debt, Or Taking Up Money Upon Usury,” described usurers as “wretched,” “vulture-like,” and “barbarous.” Cato the Elder (234–149 BCE) compared usury to murder. Cicero (106–43 BCE) stated, “these profits are despicable which incur the hatred of men, such as those of… lenders of money on usury.”
Contemporary financial analysts Sidney Homer, who worked for Salomon Bros., and Professor Richard Sylla, in their historical study of interest rates, state that the first known law on the issue was that of Hammurabi, 1800 BCE, during first dynasty Babylonia, who set the maximum rate of interest at 33⅓% per annum “for loans of grain, repayable in kind, and at 20% per annum for loans of silver by weight.”5 Sumerian documents, circa 3000 BCE, “show the systematic use of credit based on loans of grain by volume and loans of metal by weight. Often these loans carried interest.”
As early as 5000 BCE in the Middle East, dates, olives, figs, nuts, or seeds of grain were probably lent to serfs, poor farmers, or dependants, and an increased portion of the harvest was expected to be returned in kind…. Earliest historic rates were reported in the range of 20–50% per annum for loans of grain and metal.6
In Greece, 600 BCE, Solon established laws on interest when excessive debt caused economic crisis. Likewise, in Rome the “Twelve Tables” of 450 BCE, establishing the foundations of Roman law, after pervasive debt was causing servitude and crisis, established a maximum interest rate of 8⅓% per annum. When Brutus tried to charge the City of Salmais 48% for a loan, Cicero reminded him that the legal maximum was 12%. The interest rate was often 4%. Some Greek “loan sharks” charged 25% per annum, and even 25% per day.7
In the Old Testament, Jews were prohibited from usury: “Thou shalt not lend upon usury to thy brother; usury of money; usury of victuals; usury of anything that is lent upon usury” (Deut. 23:19). Critically, for history, the Jews were allowed to charge usury to non-Jews: “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 in all that thou settest thine hand to in the land whither thou goest to possess it” (Deut. 23:20).
Those prohibitions, as well as the general ethical character of the New Testament, and the Classical heritage including the Aristotlean, inherited by the Catholic Church, established the basis for Catholic social doctrine in which opposition to usury was a key element. In 325 CE the Council of Nicaea banned usury among clerics. Under Emperor Charlemagne (768–814 CE) the prohibition was extended to laymen. Here usury simply meant the extraction of more than what was lent. This is in accord with what Jesus in the Gospel of Luke (6:35) stated, that one should not expect back more than one gives. In 1139, the Second Lateran Council in Rome declared usury theft, and usurers would have to give restitution. In the 12th and 13th centuries, strategies that concealed usury were also condemned. In 1311 the Council of Vienne declared that anyone claiming usury not a sin was a heretic and should be excommunicated.8
Dante (1265–1321) placed usurers in the seventh rung of Hell, where the usurer would spend eternity with a heavy bag of money around his neck. Dante wrote:
From each neck there hung an enormous purse, each marked with its own beast and its own colours like a coat of arms. On these their streaming eyes appeared to feast.9
But the Church often allowed the Jews to practice usury. Moreover, when laws against usury slackened the pretext was an adaptation of Deut. 23:20, allowing Christian lenders to charge usury on loans to non-Christians, such as Muslims, who for their part were also forbidden usury, which the Qur’an calls the sin of riba (Al-Baqarah, 2:275). Likewise, the loophole for the Muslim lender has been that of being able to charge a “fee” for a loan, rather than interest.
The Church attitude from Medieval times was inconsistent – in some places usury remained prohibited while in other places what was instead called “interest” was permitted and justified for the recovery of “losses” by the lender, such as late payment. Hence the Lombards who, like the Jews, also became identified with money-lending, did not charge “usury” but “interest” as high as 100%. Genoa became a centre of merchant banking where usury was pursued and the Church felt powerless to act.
In Medieval England personal loans could range from 52-120% a year, depending on collateral. Frederick the Fair of Austria was borrowing at 80%, while merchants in Italy could borrow at 5-10%. The Crown of Spain was paying 40% for short-term loans, while Dutch merchants could borrow at 1¼%.10
The Reformation ushered in a revolt against the traditional order of Europe. The Protestant attitude towards usury was in flux but soon clarified with Zwingli, Luther and Calvin stating there are circumstances in which usury is acceptable. Under the division of Church and State, economic theorists began to write in defence of usury as a “progressive” form of commerce, laying the basis for the amoral merchant outlook that now grips most of the world. Money-lending was defended as a “service,” a concept that is, of course, now taken for granted by almost everyone, as argued by the French jurist Molinaeus in his 16th century Treatise on Contracts and Usury. The Church banned Molinaeus’ book and forced him into exile, but his ideas spread. It is significant that England was the first to establish a legal rate of interest, at 10%, in 1545 under Henry VIII, after he embraced the Reformation. According to Homer and Sylla:
During the Reformation many Protestant leaders defended interest and credit. As a result, the usury doctrine, which had held a firm grip on Jews and Christians for 2,000 years, was weakened and finally deserted.11
A century later the focus on economic thinking shifted to Holland where usury was defended as productive and essential by economic theorists such as Claudius Salmasius (1588–1653). Holland became the centre of banking, and the model for the Bank of England. English utilitarian philosophers such as Adam Smith and Jeremy Bentham who wrote A Defence of Usury, justified the social utility of usury. Other fathers of English economics, David Ricardo, Jean Baptiste Say and John Stuart Mill, went further in stating there should be no restraints on contracting parties in money-lending.
In the 17th century the Bank of England was founded as a private institution lending to the state. The Napoleonic war plunged Europe into colossal debt with its subsequent social, moral and political devastation. It set the pattern for the “modern age.” This era of revolutionary upheaval throughout Europe, reaching to its far off colonies, and ending with Napoleon’s defeat in 1815, saw the rise of the Rothschilds and other money-lenders to become the real masters of Europe. While Metternich of Austria tried to establish a new social order for Europe based around Throne and Altar, the real rulers would henceforth be the bankers. Historian Adam Zamoyski writes:
Every government in Europe taxed whatever it could to pay off war time borrowing. Britain had spent more in real terms than it would on the First World War, and its national debt was astronomical. Russia’s had multiplied by twenty times between 1801 and 1809, and would more than double again by 1822. Austria was technically bankrupt: over the next three decades an average of 30 per cent of state revenue would be siphoned off to service this debt.12
Zamoyski states that the five Rothschild brothers (who had been placed strategically throughout the capitals of Europe by their father Mayer Amschel Rothschild):
and particularly James in Paris and Salomon in Vienna, had lent most of the governments of Europe, and particularly those of Austria and France, large sums of money in return for government bonds… Metternich had close links with Rothschild, who had resolved many difficulties for him in the past and who had now arranged for his mother-in-law’s 400,000-franc debt to be written off.13
As for the Church’s traditional bulwark against usury:
The Papal states were bankrupt by 1832, and Metternich saved the pope by persuading the Viennese banking house of Rothschild to provide him with a loan.14
The Great Depression & Social Credit
Moving forward in history to the Great Depression of 1929-1939. This spurred a widespread awakening among all sectors of society as to the character of the banking system. Proponents of a “new” yet traditional economics began appearing in many lands across the world around the same time. During the 1930s Major C.H. Douglas’ lectures on Social Credit impacted on nations such as Britain, Canada, New Zealand, Japan, Norway and Australia (see ‘What is Social Credit?’ on page 53). The famous New Zealand Labour politician John A. Lee remarked that the problems of credit and banking were discussed widely everywhere, in pubs, on buses, in the home. The First Labour Government in New Zealand was largely elected on the issue of banking.
Who now, in this era of universal communications and education, gives five minutes to such questions, especially in pondering how to exercise one’s futile vote? Our grandparents and great grandparents, although they might not have gone to school beyond the primary level, knew immensely more about such matters than subsequent generations. They saw the effects of “poverty amongst plenty.”
As the Hermetic dictum goes: “As above so below.” What occurs in the mundane, earthly realm is a manifestation of a spiritual dichotomy. As discussed at the start of this article, the great philosophers, the primary religions, and most civilisations during those eras in which they remained attuned to their original divine origins, knew that money was a source of “evil” if it was permitted to be used beyond its original purpose and assume a power of its own. The Bible succinctly references the “love of money” as “a root of all kinds of evils”:
But those who desire to be rich fall into temptation, into a snare, into many senseless and harmful desires that plunge people into ruin and destruction. For the love of money is a root of all kinds of evils. (I Tim. 6:9-10).
Paul stated this fight is against more than terrestrial powers, but those emanating from another realm:
For we wrestle not against flesh and blood, but against principalities, against powers, against the rulers of the darkness of this world, against spiritual wickedness in high places. (Eph. 6: 12)
Like the great religious codes that formed the spiritual foundations of civilisations over millennia and across the Earth, those who have sought a return to traditional values cannot but see the role of usury and money as a commodity in the demise of our spiritual, moral and cultural being.
The influential English occultist Aleister Crowley, founder of the religion and philosophy of Thelema, was fully awake to the character of money, writing:
What is money? A means of exchange devised to facilitate the transition of business. Oil in the engine. Very good then: if instead of letting it flow as smoothly and freely as possible, you baulk its very nature; you prevent it from doing its True Will. So every restriction on the exchange of wealth is a direct violation of the Laws of Thelema.15
Apparently Social Credit is Thelemic. This might be more than coincidence. While it is reasonable to suppose that Crowley was aware of the strictures on usury by traditional religions, Crowley knew of A.R. Orage’s literary and political journal The New Age. Orage was a guild-socialist, and a prominent Fabian. He was also a follower of Russian mystic G.I. Gurdjieff, and had been a theosophist to the point of being called “The Mystic of Fleet Street.”16
Orage was the most avid and earliest promoter of Major C.H. Douglas’ Social Credit theory, and had a primary influence on the doctrine. Ezra Pound and New Zealand poet Rex Fairburn were familiarised with Major Douglas’ ideas through Orage. They would both become lifelong champions of Social Credit as the means by which the rule of Mammon could be dethroned and culture again allowed to bloom. For Orage the economic question had to be dealt with for spiritual rebirth to succeed. Hence, his commitment to both Gurdjieff and Social Credit were part of the same process. T.S. Eliot, who also adopted Social Credit, stated of Orage, whom he met in 1922:
[A]ny real change for the better meant a spiritual revolution; and he [Orage] said that no spiritual revolution was of any use unless you had a practical economic scheme.17
Kibbo Kift & the Green Shirts
In Britain, John Hargrave’s Kibbo Kift woodcraft movement was a particularly unusual development into what became one of the most militant Social Credit movements of the Depression era: the Green Shirts. Among those who publicly supported the Green Shirts was the “father of tank warfare,” Gen. J. F. C. Fuller, who had previously been one of Crowley’s most avid supporters, but who later turned to Sir Oswald Mosley and the British Union of Fascists while retaining his interest in mysticism and the esoteric. Fuller is quoted on a Hargrave leaflet as stating:
The science of credit is the secret of the limitation of wars. Therefore I welcome Social Credit, because in the clearest terms it reveals this secret to all.18
Hargrave, or White Fox, his nom de plume in Scouting journals, was a 26 year old war veteran and Commissioner for Woodcraft and Camping in Baden Powell’s movement when he and other Scout masters formed the Kindred of the Kibbo Kift. The term derives from archaic Kentish meaning “a proof of great strength.” The movement was inspired by Medievalism, Saxon heritage, Indian totemism, and other archaic influences. Folkmoots and Althings were organised in heathen tradition, with initiates wearing green, home-made Saxon-like tunics. Training included woodcraft, the forming of craft guilds, cultural development and the use of Norse and Saxon type rituals. Kinsmen were organised into Clans and Tribes.
Hargrave’s experiences as a sergeant with the stretcher-bearers in the world war (he was at the time a pacifist from a Quaker family) led to his belief that civilisation had failed and that only a few individuals could recreate themselves by withdrawing from corrupt industrial society. One can see the raison d’etre of Kibbo Kift with its harking back to pre-industrial and pre-capitalist English society to reinstate values that were beyond materialism and aligned with nature and the folk. The moral, social, political, and economic crises of the world had evoked a similar movement across Germany in the Wandervogel of young people who hiked through the country, singing as they went and forging a new camaraderie. Indeed, there were contacts between the two. Hargrave’s woodcraft books had been translated into German, and Kinsmen attended Wandervogel camps.
Employed as a draughtsman for an advertising agency, in 1923 Hargrave was introduced by the agency to Major C.H. Douglas. While Kibbo Kift enabled its members to devote themselves to a life as individuals cleansed of the corruption of industrial civilisation by harking back to a pre-capitalist ethos, Hargrave saw that Social Credit could free the whole of society.
Half our problem is psychological and the other half is economic. The psychological complex of industrial mankind can only be released by solving the economic impasse.
The conclusion is similar to Orage’s concerns. By 1927 most Kibbo Kift leaders had converted to Social Credit.
In 1930 the Legion of the Unemployed was established in Coventry. In 1931 the legion adopted a military style green shirt and beret. Soon the Legion was affiliated to Hargrave’s movement as the Green Shirts of Kibbo Kift. At the annual Kindfest of January 1931 Hargrave stated it was the duty of Kibbo Kift to break the power of the “money mongers.” This could not be done by party politics but by a movement to show the people “that absolute, that religious, that military devotion to duty without which no great cause was ever brought to a successful issue.” In 1932 Kibbo Kift adopted the green shirt uniform, and the name was changed to the Green Shirt Movement for Social Credit.
Hargrave advocated a new strategy. Social Credit until then had been quietly discussed in study groups and written of in journals of limited circulation. A militant campaign would break the silent treatment of the press, and take the issue to the streets, with marches, street corner meetings, banners and drums, publicity stunts and tabloid newspapers. Major Douglas gave the movement his approval.
With opposition from both the news media and the Communists, the Green Shirts were noted for their discipline and order in the face of provocation. They joined or organised hunger marches and demonstrations by the unemployed workers’ movement. On 9 June 1932 the first open air meeting of the Green Shirts was held in Lewisham High Street. From then until October 1934, numerous meetings and demonstrations were held, and hundreds of thousands of newspapers sold and leaflets distributed.
With the end of the war, the Social Credit Party was reactivated, and a Social Credit Envangel formed. Despite the constant activism, mass apathy reigned in the post-war world. After a poor showing of votes in April 1951 for Hargrave, the Social Credit Party was dissolved.
One of the enduring Social Credit movements founded during the Depression era is the Pilgrims of St. Michael based in Quebec, Canada. The Pilgrims are among the few movements to maintain the original crusading zeal of the Social Crediters and other opponents of usury, perhaps due to the religious basis and character of their crusade.
Ignorance of the dire effects of usury is all pervasive in this era where Mammon stands victorious over most of the Earth, where everyone from the individual credit-card holder to entire states groan under compounding mountains of debt as never before. Burdened by debt is, we are assured by politicians, bankers and economists, actually regarded as normal, until an individual or entire nation defaults. Then the bailiffs arrive, or there is an embargo or even a war.
The Austrian philosopher and social reformer Rudolf Steiner referred to the present worldly dispensation as the “Ahrimanic” power, the aim being to enchain humanity to matter. One cannot break Mammon without breaking the system that upholds its power: usury.
- Aristotle, Politics (Book I: 10: 5)
- The Sacred Laws of the Aryas, Part II, Ch. 2: 40-42
- Parasara smrti 1.63
- Sermon on the Eightfold Path, Majjhima Nikaya Suttra, 117:5
- Sidney Homer & Richard Sylla, A History of Interest Rates, Wiley, 2005
- Inferno, Canto XVII
- Homer & Sylla, Op. cit.
- Ibid., 77
- Adam Zamoyski, Phantom Terror, Harper Collins, 2014, 97
- Ibid., 384-385
- Ibid., 473
- Aleister Crowley, Magick Without Tears, Falcon Press, 1983, 346
- Paul Beekman Taylor, Gurdjieff and Orage: Brothers in Elysium, Weiser Books, 2001, 14
- Ibid., 19
- “These Names Make Social Credit News,” Hargrave, Green Shirts/Social Credit Party of Great Britain.
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