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Friday, October 13, 2006

An Award for Robbery

Welcome to those from C-L-S!

I'm going to take a quick break from my posts on subsidiarity to comment on the recent Nobel Peace Prize winner, Muhammad Yunus. Yunus created banks, called Grameen, that give small loans known as microcredit to the poor to help them fund small business ventures that, ideally, lift them out of poverty. How noble. However, if you jump down to paragraph 16 or so, you'll see that Yunus's banks charge 20 percent interest on these loans which are usually less than $200. Yes, 20 percent. I think the interest rate on the first credit card I got in college was less than that. So while Grameen claims a 99% payback rate, others argue those borrowers whose ventures fail often borrow from other high interest sources to pay back microcredit. I can't believe we live in an age where we are rewarding a man with a $1.4 million peace prize for usury. If he wants to help the poor give them loans with no interest or maybe up to 5%, but 20%? Robbing the poor of the little bit of money they make does not solve problems, it creates a whole new host of problems. We need only to look at the amount of debt most Americans carry on their credit cards to see where usury ultimately leads. It always starts out innocently enough, "Just for emergencies," or "I just use it for the frequent flyer miles," and then BAM! you have thousands of dollars in debt that came out of 'nowhere.' Should you lose your job, how long would it take to have everything seized from you? Now imagine you're a poor villager in Indian who is living hand to mouth everyday. You borrow $70 and unfortunately your business venture fails. You're already in poverty, where else do you go? Now you're living hand to mouth and you owe $84. How long will it take a person in this position, who earns pennies a day to pay that back? It is as oppressive as any $4,000 Visa bill any American carries around. People can argue his banks have helped millions of people. Fine, that's great, I'm glad there are borrowers in India who can manage small amounts of credit. But it is a slippery slope and when it comes to usury, something the Church has always spoke against, things tend to head downhill fast.

Usurers Are Not Gentlemen

1. The Prophets of Israel
and the Fathers of the Church
forbade lending money at interest.

2. Lending at interest
was called usury
by the Prophets of Israel
and the Fathers of the Church.

3. Usurers were not considered
to be gentlemen
when people used to listen
to the Prophets of Israel
and the Fathers of the Church.

4. When people used to listen
to the Prophets of Israel
and the Fathers of the Church
they could not see anything gentle
in trying to live
on the sweat of somebody else's brow
by lending money at interest.

Peter Maurin, Easy Essay


Jovan-Marya Weismiller, T.O.Carm. said...

And while Peter would never have quoted them, the Classical Pagan philosophers also condemned usury!