christian ethics and the forgiveness of third world debt

16 FAITH & ECONOMICS
ARTICLE
with you. Augustine was quite typical of Christian leaders
of his day in asserting that “the superfluous things of the
wealthy are the necessities of the poor. When superfluous
things are possessed, others’ property is possessed.” 4
By the Middle Ages the two issues of lending at interest
and sharing of surplus were distinguished conceptually. For
example, Thomas Aquinas made a strong case for private
property. Yet he stressed that for all goods “use must be in
common,” in the sense understood a thousand years earlier
in the Christian church: that what I have in excess of what
I need must be shared if others have unmet needs—out of
respect for God’s intention in creation. Aquinas’ treatment
of interest taking, however, contains no reference to the
poverty of debtors. Instead it is based on the “sterility” of
money. Money is used up—traded away—in an exchange
(similar to how a bottle of wine is used up when it is used).
Thus to charge interest on a loan of money (or wine) would
be wrong, since charging extra beyond getting back the
things borrowed would be to charge for something that does
not exist. However, lending a house to someone for a period
of time would be different, since the house can be used
without being used up. Thus charging extra (rent) in addition
to receiving the house back after that period is not
wrong. Phrasing this older view with modern words, lending
capital goods can rightfully entail an extra payment
while lending consumption goods must not.
The debates over interest taking in the Middle Ages are
classic for their complexity. Yet the development of commercial
culture made the resolution inevitable. John Calvin,
of course, took a view of lending at interest that eventually
(over the next 400 years) won out among the Christian
churches. Lending can be a service to the borrower, who
need not be exploited in the process. Eventually even the
Roman Catholic church altered its view, in effect recognizing
that, in the modern world, money is better understood as
a claim on assets. Like the house, it produces a stream of
services. Thus interest taking, within limits, is fully moral.
Even the word “usury” has changed; where it formerly
meant any taking of interest, it now means the charging of
exorbitant rates of interest. A few Christian groups (such as
the Catholic Worker movement) oppose interest taking
even today, but this is the view of a tiny minority.
Thus it is a serious problem that in talk of Third World
debt relief many Christians speak as if all interest taking
from poorer nations is immoral. It took centuries for Christians
to come to appreciate the economically beneficial role
interest taking can play in the world and it would be a great
loss to forget this now. A more thoughtful Christian response
understands debt as part of a broader relation between
poor and prosperous nations, where the burdens
associated with past debt may be quite moral. This will
depend on an assessment of the overall relationship—and
this requires economic (and other types of) analysis. I will
not attempt to review the economic issues here, but leave it
to the reader to recognize that nearly all nations (including
the US) have depended upon significant borrowing from
abroad in the early period of their economic development.
Turning, however, to that broader moral relationship
between debtor and creditor nations, I also take for granted
the judgment that wealthier nations, in particular the United
States, continue year by year to offer a niggardly contribution
to assist in the development of poorer countries. It is in
that context that arguments for debt relief have a morally
persuasive power. Strong conditionality is necessary to
prevent the transfer of existing funds away from basic
education and health care budgets when resources become
available through debt relief. But the additional risks of
moral hazard are, on balance, worth taking in light of the
political difficulty we face in expanding other forms of
development assistance from the US government.
In sum, we need to forgive the debt of the poorest
nations, but we must exercise care as to why we do so. Doing
the right thing for the wrong reason may not hurt much
today but will lead to confusion about what truly is the right
thing to do the next time around.
Endnotes
1 http://www.jubilee2000uk.org/main.html
2 http://www.jubilee2000uk.org/main.html
3 Augustine, Sermons, 239.4, Patrologia Latina 38:1128,
and in Phan, (1984) p. 229.
4 Augustine, Commentary on Psalm 147, 12, Patrologia
Latina 37:1922, and in Phan (1984) p. 197.
Reference
Phan, Peter. 1984. Social Thought, Vol. 20 of The Message
of the Fathers of the Church, Wilmington, DE: Michael
Glazier.
■ ■ ■
“That the Work of God Might be Displayed”: Debt
Forgiveness and Development
Roland Hoksbergen, Calvin College (MI)
In a well-known story from Jesus’ final days on this
earth, Jesus encounters a man born blind. His disciples want
to know who was at fault for the man’s blindness, the man
himself or his parents. But Jesus is not concerned with
blaming anyone. Instead, he answers, “neither this man nor
his parents sinned, but this happened so that the work of God
might be displayed in his life” (John 9:3). Throughout the
biblical drama, God is not interested in explaining broken-
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