You can go here to read a fine piece by David Skeel. Skeel is always a clear writer, which makes this short essay a worthwhile read for non-academics. He begins by providing an overview biblical view of lending, debt, collection, and forgiveness. Skeel gives the reader more than a series of texts; he places the texts in their historical and "utilitarian" contexts. Skeel next takes us to Daniel DeFoe's proposals for reform of the English law of debt in his 1697 tract, An Essay upon Projects. (The relationship between Defore's proposal and his status as a dissenter from the Church of England was interesting.) Next Skeel moves to the heart of his essay, Christianity and U.S. bankruptcy law. More on that below. He continues with a critique of moralists of two stripes, the "anti-bankruptcy" and the "anti-lending/anti-borrowing" crowds, theonomists (of a sort) and integralists. I have a little to add to Skeel's critique of the second group. He concludes with observations on sovereign bankruptcy where I also have an addition. And all of this in 28 pages!
I won't summarize Skeel's arguments. They are solid and generally persuasive. Folks can read them for themselves. I will, however, make a few comments in the nature of criticisms. More in the sense of what Skeel omits than in the conclusions that he draws.
The Biblical Context
Unlike anyone else I can recall, Skeel takes the Bible to valorize debt. The set of biblical restrictions on debt and its collection "necessarily implies that debt is beneficial, despite its risks. ... If debt were undesirable, the Mosaic law could simply have banished it." Like divorce? In other words, the same texts could be understood as the regulation of a necessary evil. I do not believe that conclusion would be correct because humans, even apart from sin, are physically-needy, time-bound creatures. We would have used debt to further the development of creation even apart from sin. Skeel spends some time dealing with the biblical restrictions on collateral, which I addressed at more length in a four-part series at IIIM Magazine Online (here, here, here, and here).
Christianity and U.S. Bankruptcy Law
Skeel struggles to articulate a causal relationship between American Christianity and the "fresh start" principle of U.S. personal bankruptcy law. The idea that debtors could chose bankruptcy, surrender non-exempt assets for the benefit of their creditors, and receive a discharge first appeared in the Bankruptcy Act of 1841. But what, apart from the idea of forgiveness does this ground-breaking piece of legislation, owe to Christianity? Skeel bemoans that "explicit appeals to Christianity largely disappeared from the legislative debates over bankruptcy" at this time. Nonetheless, he concludes that "Christianity seems to have played an indirect role", citing the alleged influence of Southern(!) and Western(!!) Evangelicals in the election of 1898.
There is much wrong with this account. First, as I wrote in The Missing Piece of the Puzzle: Perspectives on the Wage Priority in Bankruptcy (download here or here), there is evidence that Northern Evangelicals (the foundation of the Whig party) played a strong supporting role in fostering the enactment of the Bankruptcy Act of 1841 with its fresh-start provision. Second, citing the votes of Southern and Western states for William Jennings Bryan in 1898 does little to advance the argument that the fresh start has distinctively Christian roots. Christians in the late nineteenth-century South, unlike their descendants a century later, were not "Evangelicals." Evangelicalism--if there was/is such a "thing" (see my comments here and here)--was then still largely a Northern and Midwestern phenomenon.
Delayed Bankruptcy Relief
Here I want only to observe Skeel's criticism (in a footnote) of the position of Jonathan Burnside. I have found a great deal of value in Burnside's 500-page "God, Justice, and Society: Aspects of Law and Legality in the Bible" (OUP 2011). Yet, like Skeel, I found unpersuasive Burnside's argument in favor of direct investment over against illicit debt financing. So too Brian McCall's argument in "To Build the City of God". Both of these anti-lending/anti-borrowing approaches have a scent of the nostalgic about them.
Sovereign Debt Crisis
Briefly, I agree with Skeel's surprising argument that nation-states have more in common with individuals than with corporate debtors. States are (or should be, if they're not empires) the authoritative civil representative of a people. Unlike corporate entities, states are not creations to serve utilitarian purposes. Like individuals, there is a plausible argument that states should be able to seek something like a discharge of indebtedness. (What I wrote in Who Pays the Price? The Necessity of Taxpayer Participation in Chapter 9 (here or here) would be consistent with this conclusion.)
In short, read Skeel's essay. It's short and to the point, and should give folks plenty of food for thought.
I won't summarize Skeel's arguments. They are solid and generally persuasive. Folks can read them for themselves. I will, however, make a few comments in the nature of criticisms. More in the sense of what Skeel omits than in the conclusions that he draws.
The Biblical Context
Unlike anyone else I can recall, Skeel takes the Bible to valorize debt. The set of biblical restrictions on debt and its collection "necessarily implies that debt is beneficial, despite its risks. ... If debt were undesirable, the Mosaic law could simply have banished it." Like divorce? In other words, the same texts could be understood as the regulation of a necessary evil. I do not believe that conclusion would be correct because humans, even apart from sin, are physically-needy, time-bound creatures. We would have used debt to further the development of creation even apart from sin. Skeel spends some time dealing with the biblical restrictions on collateral, which I addressed at more length in a four-part series at IIIM Magazine Online (here, here, here, and here).
Christianity and U.S. Bankruptcy Law
Skeel struggles to articulate a causal relationship between American Christianity and the "fresh start" principle of U.S. personal bankruptcy law. The idea that debtors could chose bankruptcy, surrender non-exempt assets for the benefit of their creditors, and receive a discharge first appeared in the Bankruptcy Act of 1841. But what, apart from the idea of forgiveness does this ground-breaking piece of legislation, owe to Christianity? Skeel bemoans that "explicit appeals to Christianity largely disappeared from the legislative debates over bankruptcy" at this time. Nonetheless, he concludes that "Christianity seems to have played an indirect role", citing the alleged influence of Southern(!) and Western(!!) Evangelicals in the election of 1898.
There is much wrong with this account. First, as I wrote in The Missing Piece of the Puzzle: Perspectives on the Wage Priority in Bankruptcy (download here or here), there is evidence that Northern Evangelicals (the foundation of the Whig party) played a strong supporting role in fostering the enactment of the Bankruptcy Act of 1841 with its fresh-start provision. Second, citing the votes of Southern and Western states for William Jennings Bryan in 1898 does little to advance the argument that the fresh start has distinctively Christian roots. Christians in the late nineteenth-century South, unlike their descendants a century later, were not "Evangelicals." Evangelicalism--if there was/is such a "thing" (see my comments here and here)--was then still largely a Northern and Midwestern phenomenon.
Delayed Bankruptcy Relief
Here I want only to observe Skeel's criticism (in a footnote) of the position of Jonathan Burnside. I have found a great deal of value in Burnside's 500-page "God, Justice, and Society: Aspects of Law and Legality in the Bible" (OUP 2011). Yet, like Skeel, I found unpersuasive Burnside's argument in favor of direct investment over against illicit debt financing. So too Brian McCall's argument in "To Build the City of God". Both of these anti-lending/anti-borrowing approaches have a scent of the nostalgic about them.
Sovereign Debt Crisis
Briefly, I agree with Skeel's surprising argument that nation-states have more in common with individuals than with corporate debtors. States are (or should be, if they're not empires) the authoritative civil representative of a people. Unlike corporate entities, states are not creations to serve utilitarian purposes. Like individuals, there is a plausible argument that states should be able to seek something like a discharge of indebtedness. (What I wrote in Who Pays the Price? The Necessity of Taxpayer Participation in Chapter 9 (here or here) would be consistent with this conclusion.)
In short, read Skeel's essay. It's short and to the point, and should give folks plenty of food for thought.
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