The Supreme Court recently heard a case that turns on the meaning of “money”: What counts as “money compensation” for the purpose of a particular kind of taxation? The case seems abstruse and the write-up at Scotus Blog is a bit tongue-in-cheek, but the issue – or at least the real heart of the issue – goes back to antiquity.
The Hebrew Bible prohibits the charging of interest. There are a few versions of this prohibition (Exodus 22:25, Leviticus 25:36-37), each of which defines its scope differently. The version in Deuteronomy 23:19 reads:
You shall not charge interest on loans to another Israelite, interest on money, interest on provisions, interest on anything that is lent. (Translation NRSV)
This verse seems to clear up a problem that pops up in the other versions, which is what the prohibition of interest actually applies to. According to Deuteronomy, not only am I prohibited from charging interest on monetary loans that I make, but even on food. I am to get back exactly what I lent, with no profit or recompense for the opportunity cost that I pay for the time during which I cannot use the money or stuff I lent. So far so good, but this opens another question: What, exactly, is “interest”? Is it only money?
In a complicated chapter in the Mishnah, the rabbis of antiquity sought to answer this question. Mishnah Bava Metzia, chapter 5, begins with a straightforward case of what we would consider monetary interest: I lend you money on condition that you return to me more money than I lent you. It is not sufficient, though, to stop there. The Mishnah goes on to discuss cases in which a lender may benefit in other ways from the loan. Can a lender, for example, live for free in the house of the borrower while the loan is outstanding? (No.) Can I take a down payment from you on a field but continue to use it until you bring the balance of the payment? (No.) Can one set a price for a future delivery of a commodity? (No – because the market price might rise prior to delivery of the goods and thus the seller has profited in a way that the rabbis consider to be “interest.”) They even consider the case of a loaf of bread:
And Hillel would say thus: A woman may not lend a loaf to her friend until she sets a price for it, lest wheat become more expensive [in the interim], and it turns out they have come to [transgress] usury. (Mishnah Bava Metzia 5:9)
To the rabbis, there are many forms of “compensation” and the law demands for an accounting of each. Next to their discussion, the one recorded by Scotus Blog looks almost quaint.