INCLUDING THE TREATISE ON USURY 1519 AND INTRODUCTION
Luther’s work On Trading and Usury (Von Kauffshandlung und Wucher) was published some time before the end of June, 1524. In the beginning of the treatise he says that he has been “urged and begged” to expose some of the financial doings of the time, and has yielded to the request, though he knows that things have gone too far to be checked by his writing.
Concerning the source of the requests we are not informed but it is not unlikely that they arose out of the discussion of monopolies and the best means for suppressing them, which occurred at the Diet of Nuremberg, January to April, 1524.
Complaints were made in many quarters about the operations of the trading companies, which were taking a commanding position in certain lines of trade, and seeking to create monopolies. Similar complaints were made about the steady advance in commodity prices, which was general throughout Germany and which worked great hardship on some classes.
The rise of the companies and the phenomenal profits that they were making were, not unnaturally, connected in many minds with the advance in prices. The subject of regulation had been under discussion at more than one previous diet, especially at the Diet of Nuremberg in 1523, which went into the matter at greater length than any of its predecessors. The Diet of 1524 renewed the consideration of the matter and drastic action was proposed. The proposals were not adopted, however, either because of the influence of the great Augsburg companies in the diet itself, or because of the pressure which they were able to exert at the court of Charles V. The recess of the diet provided for a mild kind of regulation that was sure to be abortive. It was, perhaps, in view of this failure that Luther was asked by friends to speak his mind on this matter. f3 He had already spoken. In the Autumn of 1519 he had published a brief tract On Usury. A month or so later (December, 1519) he completed a revision and expansion of it, which was published early in 1520. In the Open Letter to the Christian Nobility he had again referred, though briefly, to these matters. He now republished the longer treatise On Usury, furnishing it with a new conclusion, and prefaced it with a new treatise On Trading. The complete work is translated here.
It is one of the most interesting and informing, though not one of the most important, of Luther’s works. Its chief value is historical, not theoretical. It gives us a highly interesting account of business practices in the sixteenth century, and it leaves us in no uncertainty concerning Luther’s opinion of them. It also gives us a clear idea of Luther’s own economic conceptions.
He desires men to take a religious view of business and relate it to the law of Christ; he would have them apply the Golden Rule to all of their dealings, including their dealing with money. In this respect it forms an interesting contribution to Luther’s ethics.
On the other hand, when Luther discusses the specific applications of the rule, he shows himself entirely without either sympathy or understanding for the new economic developments that were taking place around him.
His view of property is thoroughly mediaeval. It is identical with that of the scholastic doctors. Nummus non paret nummum (Money does not produce money), was for him, as for them, a fixed principle. Any effort to make money productive seemed to him to be sinful, contrary to the law of nature, and a violation of the laws of God, contained in the Old and the New Testaments. It had its roots in avarice, and the fruit of avarice is usury. That many of the practices which he rebuked are fundamentally dishonest, is a fact that no one will deny; but it is also a fact that Luther had no more idea of economic laws, as we understand them, than he had of the law of gravitation.
In estimating his views, we have also to take account of his own personal attitude toward wealth. Few men have ever lived who were more utterly indifferent to money. For him it was not a thing to be striven after, but only a means of livelihood and a resource with which to relieve the necessities of others. For this reason he was sure to see avarice where others might see only prudence.
The concluding section of the Treatise on Usury is devoted to a discussion of the practice known as Zinskauf, or Rentenkauf. The name is difficult to render into English and, after some hesitation, the term “purchase of income,” or “buying of income” has been adopted. Luther himself describes the practice adequately. It consisted of the payment of a sum of money by the buyer to the seller, in consideration of which the seller agreed to pay to the buyer a certain percentage of the purchase price annually, in perpetuity.
This percentage was known as Zinsen, which in modern German is the equivalent of “interest.” The whole transaction was a form of investment, and contains the root of the modern mortgage loan, which developed out of it. It was, in fact, a loan disguised as a sale, and Luther correctly regarded it as an evasion of the mediaeval law against usury.
The text of the work is found in Weimar Ed. 15:293-313, 321-22; 6:36-60: Erlangen Ed. (1) 20:89-122; (2) 16:79-112; and 22:200-226; St. Louis Ed., 10:914-937; 825-854. C1emen, 3:1-46: Berlin Ed. 7:514-40 (first part only). The translation is made from the text of Clemen.
Literature. Extensive bibliographies in Weimar Ed., 15:283,PRESERVED SMITH, Age of the Reformation (1920), pp. 80-83, and Cambridge Modern History, 1, pp. 773-78. Cunningham’s chapter “Economic Change,” in Cambridge Modern History, 1, pp. 493-531, is valuable. The best brief discussion in English is that ofPRESERVED SMITH, op. cit., pp. 515-62. As an introduction to the specific subject of the treatise, the work of ECK, in Berlin Ed., 7:494-513, is most useful.
CHARLES M. JACOBS.
MOUNT AIRY, PHILADELPHIA.