The whole evolution of European civilization was greatly hindered by this conscientious policy. Money could only be loaned in most countries at the risk of incurring odium in this world and damnation in the next; hence there was but little capital and few lenders. The rates of interest became at times enormous; as high as forty per cent in England, and ten per cent a month in Italy and Spain. Commerce, manufactures, and general enterprise were dwarfed, while pauperism flourished.
Yet worse than these were the moral results. Doing what one holds to be evil is only second in bad consequences to doing what is really evil; hence, all lending and borrowing, even for the most legitimate purposes and at the most reasonable rates, tended to debase both borrower and lender. The prohibition of lending at interest in continental Europe promoted luxury and discouraged economy; the rich, who were not engaged in business, finding no easy way of employing their incomes productively, spent them largely in ostentation and riotous living. One evil effect is felt in all parts of the world to this hour. The Jews, so acute in intellect and strong in will, were virtually drawn or driven out of all other industries or professions by the theory that their race, being accursed, was only fitted for the abhorred profession of money-lending.(451)
(451) For evil economic results, and especially for the rise of the rate
of interest in England and elsewhere at times to forty per cent, see
Cunningham, Growth of English Industry and Commerce, Cambridge, 1890,
p. 189; and for its rising to ten per cent a month, see Bedarride, Les
Juifs en France, en Italie, at en Espagne, p. 220; see also Hallam's
Middle Ages, London, 1853, pp. 401, 402. For the evil moral effects of
the Church doctrine against taking interest, see Montesquieu, Esprit
des Lois, lib. xxi, chap. xx; see also Sismondi, cited in Lecky. For
the trifling with conscience, distinction between "consumptibles" and
"fungibles," "possessio" and "dominium," etc., see Ashley, English
Economic History, New York, pp. 152, 153; see also Leopold Delisle,
Etudes, pp. 198, 468. For the effects of these doctrines on the Jews,
see Milman, History of the Jews, vol. iii, p. 179; also Wellhausen,
History of Israel, London, 1885, p. 546; also Beugnot, Les Juifs
d'Occident, Paris, 1824, pt. 2, p. 114 (on driving Jews out of other
industries than money-lending). For a noted mediaeval evasion of the
Church rules against usury, see Peruzzi, Storia del Commercio e dei
Banchieri di Firenze, Florence, 1868, pp. 172, 173.
These evils were so manifest, when trade began to revive throughout Europe in the fifteenth century, that most earnest exertions were put forth to induce the Church to change its position.
The first important effort of this kind was made by John Gerson. His general learning made him Chancellor of the University of Paris; his sacred learning made him the leading orator at the Council of Constance; his piety led men to attribute to him The Imitation of Christ. Shaking off theological shackles, he declared, "Better is it to lend money at reasonable interest, and thus to give aid to the poor, than to see them reduced by poverty to steal, waste their goods, and sell at a low price their personal and real property."
But this idea was at once buried beneath citations from the Scriptures, the fathers, councils, popes, and the canon law. Even in the most active countries there seemed to be no hope. In England, under Henry VII, Cardinal Morton, the lord chancellor, addressed Parliament, asking it to take into consideration loans of money at interest. The result was a law which imposed on lenders at interest a fine of a hundred pounds besides the annulment of the loan; and, to show that there was an offence against religion involved, there was added a clause "reserving to the Church, notwithstanding this punishment, the correction of their souls according to the laws of the same."
Similar enactments were made by civil authority in various parts of Europe; and just when the trade, commerce, and manufactures of the modern epoch had received an immense impulse from the great series of voyages of discovery by such men as Columbus, Vasco da Gama, Magellan, and the Cabots, this barrier against enterprise was strengthened by a decree from no less enlightened a pontiff than Leo X.
The popular feeling warranted such decrees. As late as the end of the Middle Ages we find the people of Piacenza dragging the body of a money-lender out of his grave in consecrated ground and throwing it into the river Po, in order to stop a prolonged rainstorm; and outbreaks of the same spirit were frequent in other countries. (452)
(452) For Gerson's argument favouring a reasonable rate of interest, see
Coquelin and Guillaumin, Dictionnaire, article Interet. For the renewed
opposition to the taking of interest in England, see Craik, History of
British Commerce, chap. vi. The statute cited is 3 Henry VII, chap. vi;
it is found in Gibson's Corpus Juris Eccles. Anglic., p. 1071. For
the adverse decree of Leo X, see Liegeois, p. 76. See also Lecky,
Rationalism, vol. ii. For the dragging out of the usurer's body at
Piacenza, see Burckhardt, The Renaissance in Italy, London, 1878, vol.
ii, p. 339. For public opinion of similar strength on this subject in
England, see Cunningham, p. 239; also Pike, History of Crime in England,
vol. i, pp. 127, 193. For good general observations on the same, see
Stephen, History of Criminal Law in England, London, 1883, vol. iii, pp.
195-197. For usury laws in Castile and Aragon, see Bedarride, pp.
191, 192. For exceedingly valuable details as to the attitude of the
mediaeval Church, see Leopold Delisle, Etudes sur la Classe Agricole en
Normandie au Moyen Age, Evreux, 1851, pp. 200 et seq., also p. 468. For
penalties in France, see Matthew Paris, Chronica Majora, in the Rolls
Series, especially vol. iii, pp. 191, 192. For a curious evasion,
sanctioned by Popes Martin V and Calixtus III when Church corporations
became money-lenders, see H. C. Lea on The Ecclesiastical Treatment of
Usury, in the Yale Review for February, 1894. For a detailed development
of interesting subordinate points, see Ashley, Introduction to English
Economic History and Theory, vol. ii, ch, vi.
Another mode of obtaining relief was tried. Subtle theologians devised evasions of various sorts. Two among these inventions of the schoolmen obtained much notoriety.