The Church and Usury: Error, Change or Development?

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To whom it may concern:

In 1999 I completed a thesis paper for my Theology M.A. (at Mt. St. Mary's Seminary in Emmitsburg, MD) entitled "The Church and Usury: Error, Change or Development" which I wondered if you would consider it for publication.

Here is a synopsis of my paper:

My thesis: "The Church once condemned usury as the taking of profit on a loan, yet today it allows profitable investment. Did the Church teaching change?"

The Preface and Introduction sets out how the paper is partly a response to the work of John Noonan, author of the definitive history on usury and another history on birth control, which he links together in a 1966 article "Authority, Usury, and Contraception." It is also partly a response to other theologians who since that time have rejected the Church's authority to teach on matters of morality, by claiming that usury is the prime example of changing moral norms.

Chapters One and Two lay the foundation while examining the different arguments which say that the Church teaching changed. Chapter One examine arguments which say the Church reversed its erroneous moral teaching, and thus is not a reliable teacher of morals. It lays out the various scriptural arguments and introduces some of the teachings of the Fathers, Popes and Councils on usury. It then makes an examination of change in the Church's teaching while believing in objective moral norms, using John Henry Newman's "Essay on the Development of Christian Doctrine" as a starting point for examining change in moral teaching. The conclusion of the chapter is there is the possibity of development in the Church's teaching, without it being a contradiction or in error.

Chapter Two examines arguments that admit the church changed its teaching, but then claim that something about the nature of the usury teaching allowed it to be changed by the Church. This requires a review of how the magisterium of the Church teaches, and then clearly examining the teachings of the Popes and Councils. Some say it wasn't taught infallibly, others say it was only a disciplinary teaching, others that the Church's teaching was conditionally taught, and some that only the intention or spirit of the law is important. These positions are all rejected, for we cannot deny the Church prohibited usury, but we must examine the scholastic arguments of exactly what is being taught and why.

Chapters Three and Four present two different arguments for a legitimate development in the Church's teaching. Chapter Three examines in detail the teaching of philosophers, theologians, and canonists of the Scholastic era and sees how interest was permitted as an exception to the usury prohibition. Certain factors which were intrinsic to the loan itself caused a loss to the lender, which then in justice should be repayed by the borrowed, and this loss was called "interest." When the economic system in society began changing, the exceptions became more frequent and eventually the norm, until the exceptions can be assumed to exist in most cases, but this did not change the basic teaching of the Church.

Chapter Four examines the argument that the nature of the financial transaction itself has changed so much that the usury teaching no longer applies, as today a loan is different since the nature of money is changed. Interest is now justified as something intrinsic to the loan itself, because money is now productive. The Church teaching's on usury are essentially obsolete, as they speak about something completely different. The conclusion is that both arguments are legitimate and can be combined in a joint view which clearly shows that the Church was always consistent in its teaching and has not radically changed, even if financial conditions have.

Chapter Five examines those who believe that the Church's prohibition of usury is still identical with the teaching of the middle ages, but it is being completely ignored and violated today, believing that all modern banking and interest taking is sinful. This includes the arguments of Dorothy Day, Hilaire Belloc and Jacque Maritain. While in error, their writings remind us that a part of the usury teaching is the avoiding of exploitation of the poor. In this area there are perhaps some legitimate criticism of modern banking, and some interesting ideas that can be gained from past teachings, along with a reminder of current Church teaching on social justice and solidarity.

The Conclusion and Epilogue contains a more detailed summary than the brief description I have given here, with the ultimate conclusion that the basic teaching on usury still remains in effect and unchanged, and thus it fails to be a valid example of a reversal of Church teaching.

The paper itself is 55 pages double spaced, which includes abundant footnotes. A rather comprehensive Bibliography of works consulted adds six more pages. While I try to keep it simple, the subject matter of the paper occasionally requires some terminology in philosophy, theology and economics.

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