Defence of Usury [0]
Defence of Usury
by Jeremy Bentham
1787
Defence of Usury; Shewing the Impolity of the Present Legal Restraints on the Terms of Pecuniary Bargains In a Series of Letters to a Friend To Which is Added A Letter to Adam Smith, Esq; LL.D. On the Discouragements opposed by the above Restraints to the Progress of Inventive Industry 1787
LETTER I. Introduction Crichoff, in White Russia, January 1787
Among the various species or modifications of liberty, of which on different occasions we have heard so much in England, I do not recollect ever seeing any thing yet offered in behalf of the liberty of making one's own terms in money-bargains. From so general and universal a neglect, it is an old notion of mine, as you well know, that this meek and unassuming species of liberty has been suffering much injustice. A fancy has taken me, just now, to trouble you with my reasons: which, if you think them capable of answering any good purpose, you may forward to the press: or in the other case, what will give you less trouble, to the fire. In a word, the proposition I have been accustomed to lay down to myself on this subject is the following one, viz. that no man of ripe years and of sound mind, acting freely, and with his eyes open, ought to be hindered, with a view to his advantage, from making such bargain, in the way of obtaining money, as he thinks fit: nor, (what is a necessary consequence) any body hindered from supplying him, upon any terms he thinks proper to accede to. This proposition, were it to be received, would level, you see, at one stroke, all the barriers which law, either statute or common, have in their united wisdom set up, either against the crying sin of Usury, or against the hard-named and little-heard-of practice of Champerty; to which we must also add a portion of the multifarious, and as little heard-of offence, of Maintenance. On this occasion, were it any individual antagonist I had to deal with, my part would be a smooth and easy one. "You, who fetter contracts; you, who lay restraints on the liberty of man, it is for you" (I should say) "to assign a reason for your doing so." That contracts in general ought to be observed, is a rule, the propriety of which, no man was ever yet found wrong-headed enough to deny: if this case is one of the exceptions (for some doubtless there are) which the safety and welfare of every society require should be taken out of that general rule, in this case. as in all those others, it lies upon him, who alledges the necessity of the exception, to produce a reason for it. This, I say, would be a short and very easy method with an individual: but, as the world has no mouth of its own to plead by, no certain attorney by which it can "come and defend this force and injury," I must even find arguments for it at a venture, and ransack my own imagination for such phantoms as I can find to fight with. In favour of the restraints opposed to the species of liberty I contend for, I can imagine but five arguments. 1. Prevention of usury. 2. Prevention of prodigality. 3. Protection of indigence against extortion. 4. Repression of the temerity of projectors. 5. Protection of simplicity against imposition. Of all these in their order.
LETTER II Reasons for Restraint. -- Prevention of Usury.
I will begin with the prevention of usury: because in the sound of the word usury lies, I take it, the main strength of the argument: or, to speak strictly, of what is of more importance than all argument, of the hold which the opinion I am combating has obtained on the imaginations and passions of mankind. Usury is a bad thing, and as such ought to be prevented: usurers are a bad sort of men, a very bad sort of men, and as such ought to be punished and suppressed. These are among the string of propositions which every man finds handed down to him from his progenitors: which most men are disposed to accede to without examination, and indeed not unnaturally nor even unreasonably disposed, for it is impossible