Usury is the process by which an owner receives a constant sum of money or percentage of revenues from another person using their capital. Depending on the nature of the property that is loaned out, the name of the sum of money changes: interest (for money), rent (for land and buildings), profit (for means of production).
Usury is a claim to have a right to an indefinite stream of income from a finite amount of labor. The fundamental problem may not be so much the one act in itself, but rather the system that builds upon it– it is that system that allows for enormous power disparities and one class to abuse those. What happens is, a person can obtain a single plot of land, rent it out, use the rent money to buy another plot of land soon, rent that out, use the newly-doubled-income to buy more land and rent it out too, and expand the estate to the point where anyone nearby cannot own land and must labor under the landlord.
As the estate expands, the landlord continues abusing his power and increasing the domain of the power disparity. The landlord also maintains an authoritarian relationship with the tenants, insofar as he can increase the rent and they must labor harder to pay it. (Their only choice is to leave, but the costs of leaving almost always will outweigh the costs of submitting to the authoritarianism, and being free to leave is no justification for social authority.) As the landlord maintains a monopoly of ultimate power over the land, he can also enable statist programs and maintain statelike powers, all while he did not actually labor for the income from the rent. (The only labor he does is in the beginning while acquiring the land, but a finite amount of labor deserves a finite payment, not an indefinite flow of income.)
The landlord now is a central of wealth, and he is justified in using force to extract more from the laborers. (This would be the difference between this situation and an alternative where the tenant offers a one-time finite gift in exchange for use.) This also leads to the situation where the landlord now uses his power to make things his way– in a court case, he can easily bribe the judge and get away with it, or make the tenants serve as eyewitnesses to get the court to rule one way.)
A child born to a tenant would owe rent as he/she grows up on the estate, and the child's only other choice would be to leave, which resorts the whole situation to a very state-like one, the only possible difference being that the land was 'voluntarily' acquired. But libsocs do not believe the State can be justified if only it had acquired the land the 'right' way– rather, the State is wrong because power disparities are wrong and inherently violate liberty.
This situation demonstrates the scenario of renting, but the same law applies to profit and interest– allowing the privileged to abuse the power disparities to increase the domain of their power.
Alternatively, usury is predicated on the implicit belief that capital is in and of itself a productive force, and therefore the capital is somehow owed restitution which is then passed on to its owner in the form of interest/rent/profit. But money alone, land alone, or tools alone cannot produce anything, and they are only productive when they are being used by people. Therefore it is invalid to say that owners are owed usury, and since resources are limited, usury represents financial exploitation, which is morally wrong.
From: FAQ by Libsocs for “An”caps by Francois Tremblay and Noor Mehta
Interest is only justified due to the reality of risk. If there was no true risk, I would say charging interest on any loan was wrong.ReplyDelete
In the same way, renting is a necessity because there are some who cannot afford a home for purchase, even if they can get a loan (and we shouldn't force people to get a loan and be a mortgage slave instead of a rent slave). I think there needs to be measures to protect renters, namely that rent should be tax deductible in the same way that mortgage interest is debuctible. It would also be great if low-income housing was provided in a sort of "rent-to-own" system.
There can also be limits placed on how much rent can increase, but this must be maintains by the government with property tax in mind (there have actually been places lately that have raised property tax to an extent that landlords simply kicked out tenants and condemned the buildings, because it was cheaper and unfeasible to continue renting them out).
The problem is, none of these are easy, slogan driven ideas that can be simplified and spoonfed to voters as a simple polemic like "smaller government" or "private tyranny."
"Interest is only justified due to the reality of risk."ReplyDelete
Nope. We already answered that in the FAQ.
"renting is a necessity because there are some who cannot afford a home for purchase"
Also answered in the FAQ.
Yeah... obviously you don't get what I said, otherwise I might have gotten a more measured response than "nope." You need interest in order to cover risk not as a means of saying "Well, you don't deserve income because you accept risk." Interest needs to be charged because without interest, lending is always a losing game. No one would lend if there was only the risk of someone not paying you back and no means of recouping your losses. Also, your brilliant FAQ fails to mention anything about the fact that many people earn money outside of the simplistic system of "wage earning." If you want to go back to pre-banking ecnomies, fine... do it in your own soon-to-fail country.ReplyDelete
Perhaps you can point out where in your FAQ you mention how it is that people are supposed to buy something they need today that they can only afford in 10-20 years.
Pre-banking economies? What are you talking about? I'm a socialist, not a primitivist.ReplyDelete
"Nope" is the most measured response I can make to questions that are _already answered_ in the linked FAQ, which you should read. What's the point of asking a Frequently Asked Question if you don't read the FAQ first? Your risk argument is answered in point 5. The rental problem is addressed in point 6.
As for your other arguments, I don't really understand them.
"No one would lend if there was only the risk of someone not paying you back and no means of recouping your losses."- ... in your world, there are no laws against theft or breach of contract? What? This is a very confused question.
"Also, your brilliant FAQ fails to mention anything about the fact that many people earn money outside of the simplistic system of "wage earning.""- What in the hell does that have to do with LTV or usury?
Again, please read the FAQ before shooting off questions.
Nikk J: "Depending on the nature of the property that is loaned out, the name of the sum of money changes: interest (for money), rent (for land and buildings), profit (for means of production)."ReplyDelete
Jct: Ezekiel 18 denounced "he who exacts usury or excessive interest." So there is a difference between usury and interest. Interest is on cows that have babies, usury is on money that does not and creates a mort-gage death-gamble musical chairs game where not all can survive borrowing 10 and having to pay back 11.
I didn't know the Bible was our reference textbook for economics now. The Catholic Church caved in on the issue of interest rates anyhow, which is not surprising from a church that persecuted people for centuries.ReplyDelete
in your world, there are no laws against theft or breach of contract?ReplyDelete
Well in Nikk's world, there are no laws because there is no government. Even if you have laws and they are enforced, you cannot force people to pay anything back, ever. You can't get blood from a turnip, as they say.
I find your "socialism" to bear no resemblance to any system of socialism which currently exists or has been proposed by anyone actually studying socialism as a coherent and workable system. Maybe you can explain to me how why everyone is going to magically have wealth from the moment they need something.
"Well in Nikk's world, there are no laws because there is no government."ReplyDelete
Wrong. Anarchy is not anomie.
"Even if you have laws and they are enforced, you cannot force people to pay anything back, ever. You can't get blood from a turnip, as they say."
What are you going on about?
"I find your "socialism" to bear no resemblance to any system of socialism which currently exists or has been proposed by anyone actually studying socialism as a coherent and workable system."
Look up "libertarian socialism." You could have found this in about two seconds on wikipedia. Lazy. What does that have to do with usury or LTV?
"Maybe you can explain to me how why everyone is going to magically have wealth from the moment they need something."
Magically? Who said magic was involved? What a stupid straw man. What does that have to do with usury or LTV?
What a waste of time this guy was.ReplyDelete