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Posted by Paul
(220.127.116.11) on May 18, 2004 at 21:53:07:
In Reply to: USERY posted by J Kelly on May 18, 2004 at 21:26:25:
Usury is lending money and charging for it.
Usurious interest is “unconscionable” or illegal rates of interest. What is unconscionable or illegal has varied throughout the ages. Many religious beliefs condemned usury as making money without doing any work. Just the act of having money makes you money without working for it.
“Nevertheless, the 12th canon of the First Council of Carthage (345) and the 36th canon of the Council of Aix (789) have declared it to be reprehensible even for laymen to make money by lending at interest.”
While Luther, Melanchthon, and Zwingle condemned loaning for interest, Calvin permitted interest on money advanced to rich persons; his disciple Salmasius gave effect to this opinion by a systematic code of rules. By degrees a certain number of Catholic writers relaxed their severity. Scipio Maffei, a friend of Benedict XIV, wrote a celebrated treatise, "Dell' impiego del danaro", to justify an opinion which in this matter resembles that of Calvin. Economists generally uphold the theoretical lawfulness of interest on loans. For a long time civil law was in agreement with canon law; but as early as the sixteenth century, Germany allowed interest at 5 percent; in France, on the contrary, interest on loans was forbidden until the Decree of 2 and 3 October, 1789. Contemporary laws always consider the loan for consumption as gratuitous in principle, but allow a stipulation for the payment of interest to be added. In modern legislation two questions remain to be decided:
· whether it is desirable to establish a maximum legal rate; and
· by what means usurious exactions may be prevented.
Thus, nation-states have always had to legislate an interest rate above which was illegal usury to prevent rank exploitation by the money lenders.
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