Assumed Audience: Members of The Church of Jesus Christ of Latter-day Saints who are curious about history, civilizations, and/or Zion.

Epistemic Status: Extremely confident in the priciples. The more general or high level things are, the more confident I am. I become less confident as things become more detailed.

Chapter 13: “Thou Shalt Not Lend upon Usury” 1

Samuel appeared in the doorway. “Josiah, please come with me.”

“Sure, Dad.”

As they approached the Judgment Hall, Samuel said, “Eli has finally healed from his gunshot wound, so he can finally deal with the cases about usury.”

“Including the one with the bishop gone bad?”

“The one you took out with your frag grenade? Yes.”

Eli came out of the Judgment Hall to greet them.

“Don’t worry, Josiah,” he said mischieviously, “no stressful cases today.”

“Dad said that we would do the one with the bishop gone bad, though.”

“Ah yes, but since he and his cronies are dead, we’re just going through the financials today.”

And when Eli brought them up on the screen, Josiah gasped. “How in the world did he get so much money?”

Eli replied, “One word: usury.”

“Okay, so what is usury?”

“You know, the scriptures aren’t entirely clear about it,” Eli admitted. “We can only assume that the people from Old Testament times knew what it was so much that no writer felt compelled to define it for later readers.”

“Yes, and that was dumb,” Samuel grumbled. “Convincing people of my definition was just about the hardest thing I’ve done. And I lost an eye to the antichrist!”

Josiah turned to him. “Your definition?”

“Yes,” Samuel said. “People were trying to get away with usury at the beginning by using a narrow definition.”

“You see,” Eli continued, “before Samuel, people would usually think of usury as equivalent to interest, as in, the interest on a loan.

“But Samuel’s definition is so much more strict: usury is money made from the control of money or scarce resources.”

“That sounds almost circular,” Josiah said.

“True, but I can explain,” Eli said. “We don’t have banks in Zion, but do you know how they make money?”

“No.”

“They make money by taking control of your money when you deposit it in a bank account and lending it out.”

“Wait, didn’t bank accounts give you interest?”

“Yes, but always less than what the bank charged on the loans they gave people; they just covered the interest on bank accounts with interest from loans and pocketed the difference.

“Essentially, usury is whenever someone with money charges for access to that money.”

“Okay, but why is that a problem?” Josiah asked. “I presume usury is not allowed?”

“Of course,” Eli said, “and it’s not allowed for a simple reason: if you can make money simply by having more money, then people will do that.

“This is bad for two reasons: first, it means that people with more money can easily make even more, and second, it means they are making money and not doing anything useful.”

“Okay,” Josiah said, “I get why it might not be good for people with lots of money to make more, wealth inequality and all that…”

“Well,” Eli said, “it’s not just that.

“There is such a thing as the cost of poverty, or the poverty premium. It’s a phenomenon where the poor pay higher prices for equivalent goods. This is entirely traceable to usury: a poor person doesn’t have much access to money, so if they are paying higher prices, it’s purely because they have less access. Thus, whoever they are paying is essentially charging usury.”

“Wow…”

“Took so long to get people to see that!” Samuel snapped, at no one in particular.

“Fair enough. But what are some examples of usury?”

“Loans, including mortgages, are the big one,” Eli replied. “But also banks, as we just mentioned, as well as the money changers in the Temple during Christ’s mortal ministry because they would charge people through access to different types of money.”

“That makes sense.”

“Oh and inflation.”

“Wait, inflation?”

“Yes, inflation.”

“No shot!”

Eli smiled. “It’s true, though.

“When people have savings, inflation reduces the value of those savings. That value goes somewhere, and inflation usually benefits the government. While not exactly true, you can think of inflation as the usury that the government collects.”

“Oh, wow…”

“Yes, that is why one of my jobs as chief judge is to minimize inflation and deflation. One of the weirdest meetings I have every quarter is a meeting where we estimate the real value of everything in Zion’s economy and then order that much money printed, plus whatever amounts got destroyed in the last quarter. We do that because we want to keep inflation at zero.”

“Most boring meeting I have to attend,” grumbled Samuel.

“I find it kind of exciting!” said Eli.

“Yes, well, I knew you were crazy when you told me that you would like to be chief judge.”

Eli chuckled. “Anyway, inflation is a form of usury.

“In like manner, however, deflation is also a form of reverse usury, kind of like the interest banks would pay on accounts. So we try to avoid that too.”

“But isn’t deflation, like, so much more dangerous than inflation?” Josiah asked.

“Only when debt exists,” Eli said, “because it means that debts grow in value. But since usury doesn’t exist, neither can debt.”

“Wait, doesn’t the government borrow money too?”

“No,” said Eli, “I cannot borrow any money, nor can any other judge. The tax rate is a flat 10%, just like tithing, and I am expected to keep the government spending below that.”

“And surprisingly for someone as mental as him,” Samuel growled, “he does it. Even with his nuclear fusion pet project. He even manages to save money.”

“But why?” Josiah asked.

“Because government debt is also a form of usury,” Eli replied. “It’s a usury charged against future generations, who have to pay the interest.”

“That…removes a lot of funding options from you,” Josiah said.

“Absolutely,” Eli said, “but I would not be a good steward if I allowed my stewardship, Zion’s government, to spend more than its means.”

Josiah nodded, then cocked his head. “But if loans are not allowed, how do people afford their houses? Does everyone have to rent?”

“Not at all! In fact, renting is a kind of usury, too!”

When Josiah’s jaw dropped, Eli smiled and continued. “Essentially, people who buy land are just first movers. In a way, they control money through their control of land, one resource that cannot be multiplied.

“And because they were first, they need less money to get more. This creates a situation where there are winners and losers, something Zion cannot tolerate because:

…it is not given that one man should possess that which is above another, wherefore the world lieth in sin.

D&C 49:20

“Thus,” Eli continued, “rent is just a usury charged by those who got there first, and renting is not a thing in Zion.”

Josiah furrowed his brow. “So how do people own their homes?”

“Housing is owned by the wards. When a bishop gives a man a job,” Eli said, “he always includes housing in the deal, which the man must use as a residence. That house then becomes a substewardship for the man and his family; they are expected to improve it and maintain it as though they owned it.”

“It sounds dangerous to have all housing owned by the wards,” Josiah said.

“Well, not everything is, but that’s the default.”

“What if the bishop doesn’t provide housing? Or a job?”

“That’s exactly what happened with the bishop gone bad,” Eli said. “He wasn’t including housing in the job deals; instead, he was renting the houses. When that happens…”

“We take care of the problem,” Samuel said with finality.

“That still sounds like a lot of power to give the Church,” Josiah said.

“True, but that power is also decentralized,” Eli replied. “And while the Prophet is powerful, in that he has power over our souls, and could theoretically exercise the power that the bishops have, he is still subject to my power over secular affairs.

“Remember: he has a stewardship too, and if he, or any Church leader steps out of their bounds, it is I who have the final say. This is an example of the sort of checks and balances that the United States Constitution had.

“That, and Christ would remove a prophet immediately who exercised his power poorly.”

“Makes sense.”

“It goes even further,” Eli continued. “Even insurance is usury. This includes what the United States called ‘health insurance.’

“Why is insurance usury?” Josiah asked. “I thought insurance spreads risk.”

“Yes, but that risk spreading is done by people who control access to large funds,” Eli replied. “And they charge a premium. Literally.”

“But it’s impossible to save up for some kinds of catastrophes, right?”

“Yes, but we don’t expect people to do that in Zion,” Eli said. “Instead, that is what the bishop’s storehouse is for locally. Zion-wide, that’s what the Church welfare system is for.

“Back when the USA existed, insurance companies would take your premiums, but they would do everything they could to avoid paying out when things did happen. They did this with legalese and lawyers, as well as just plain stonewalling. Health insurance did much the same thing.

“They would also negotiate their own prices for things and do things their own way. For example, if your house was destroyed in a storm, they might ‘replace’ your house, but they would do a shoddy job, so the house you would get would not be equivalent.

“This was so bad in health insurance, that it could be cheaper to pay in cash than actually use the insurance.

“So yeah, insurance is usury.”

Josiah nodded, then lapsed into thought. “Does this mean that anything that disadvantages the poor could be thought of usury?”

“Pretty much,” Eli said. “In fact, anything where value is extracted parasitically can be considered usury, like rent-seeking on patents or copyright, or bribes, or nepotism in handing out contracts or positions.”

“Oh! On that point: why is it bad if people don’t do anything useful?”

“Good question,” said Eli, shutting down his computer, “but let’s get on a train; that’s a question for the next case.”