I’m just some guy. I have an MBA, I’ve started and run a few small companies, and I have quite a bit of experience as an investor. I became interested in usury in 2008 during the financial crisis, and was surprised to find myself in perfect agreement (as best as I can tell) with St. Thomas Aquinas on the subject. I’ve read every single Magisterial statement on the subject in Denzinger, everything I could find by Aquinas, a number of old books, some academic papers, and a bunch of stuff on the web.
Usually this is because the property risks – the risks of partial or total loss of capital invested – in the investment are high enough to make a simple fixed-interest debt instrument inappropriate
Part of what made the usury doctrine clear to me when I first really began to grasp it (as opposed to – and I was as guilty of this as anyone – superficially dismissing caricatures rooted in anti-realist modernism) is that as an investor and entrepreneur, I see investment contracts involving peronal guarantees of repayment as inherently dysfunctional. If either the investor or the entrepreneur feels the need to throw personal guarantees into the mix in order to get the deal done, that is a major red flag that the proposed capital structure of the investment doesn’t make sense on its own terms. Instead of personal guarantees the structure should be something like a convertible note, with equity upside, or it should be secured by a larger base of existing (though probably illiquid) capital. Basically, someone is trying to consume capital they don’t have and/or shift their own risks – the risks inherent in their own portfolios of property – onto third parties, personally.
Anyway, I haven’t really added anything new to the ancient understanding of usury here. I was just a guy who happened to be standing in the right spot to see what caused the train wreck, and I’m trying to explain what I saw in our common modern language as best I can. Like theft usury often does pay, at least in the short run, and it causes all sorts of damage that impacts different people differently and unfairly. Usury is inherently dysfunctional and morally evil, like theft.
It may be mildly interesting sociologically that the Catholic Church was right for millennia about a simple core financial and moral truth that modern people, for all their putative economic and technical sophistication, have gotten completely wrong
29) I know that usury was traditionally considered an execrable mortal sin. But didn’t the Church change canon law and pastoral practice to remove the penalties and stigma associated with usury? Haven’t most Catholic theologians accepted that the world has moved on from the time when the prohibition of usury made sense?
My answer is yes. The progressive tactic of divorcing doctrine from pastoral and juridical practice is not a new Vatican II innovation targeted specifically at matters of sex and marriage. Earlier progressives were “successful” in leaving the doctrine on usury formally intact, as a kind of decoration that makes no important demands on anyone, despite their attendance of the traditional Latin Mass. Humanae Vitae could easily become the new Vix Pervenit. Contraception apologists have learned from earlier usury apologists and are using the same tactics. Progressives think that money is inherently fecund and that sex isn’t inherently fecund.
Acceptance of usury and contraception are both products of denying that things have an objective nature independent of human preferences. Centuries of ‘pastoral’ acceptance and indoctrination of economic relativism paved the way for other expressions of moral relativism.