"The rich rule over the poor, and the borrower is slave to the lender." (Proverbs 22:7)
The above verse seems so pertinent to current events in the U.S economy and the average American consumer right now. Here are some thoughts:
Proverbs 22:7 is direct and self explanatory. Whether we are living in 8th century B.C. Judea or in modern America, the lender will most likely charge interest or demand some sort of compensation. If we borrow something, we are now subject to the will of the lender and are forced to comply with their terms.
Every time we pay interest, we are WORKING for the lender - in effect becoming their slave. We must work just to support that debt. Not only has the lender become the master in this regard, he/she is becoming wealthier at the same time.
This is one important way that the rich become richer, and the poor become poorer. (See Matthew 25:29 - "For everyone who has will be given more, and he will have an abundance. Whoever does not have, even what he has will be taken from him.")
The "rich" put money to work for themselves in the form of lending and investments. They earn money from their loans, just as Jesus encourages in the parable of the talents. (Matthew 25:14 - 30 ) The "rich" are masters of their money, not servants to it, as it works and multiplies for them.
Those that are "poor" not only fail to make money work for them (lend/invest), but they are losing money/net-worth by paying out interest. One borrows when they want to spend more than they actually have. The price, according to Proverbs, is servitude.
The rich, who are wise with their earnings, just keep getting richer as they continually master their use of money.
On a side note:
Its interesting that the Hebrew word translated as 'borrow' is lavah which, in addition to referring to borrowing/lending, is often used throughout the Bible to mean "to cleave" or to "entwine" or "join." For example, in Genesis 29:34 Leah desires Jacob to be "joined" with her - as an intimate lover. Hmmm...
Do we want to be joined with the lender?! Being cleaved to or entwined is the opposite of being independent. We lose our freedom at the moment we allow debt to make us the servant.
(By the way, I am not saying that all debt is bad...just trying to make observations based on Proverbs)
SO, what does this mean for Americans?
Personal spending on credit is at record levels. The average American household, has $6,000 to $15,000 in credit card debt alone (according to various statistics - who knows which to believe?) Keep in mind that this is not including mortgage debt - only consumer spending. The banks, and their investors, are getting rich by lending us money to fulfill our consumeristic desires. Are we serving Mammon?
Have we been living beyond our means????
The United States certainly has. Today, the US total government debt is over $14 Trillion Dollars. Most of the US National Debt is foreign financed, with China holding a large percentage. Is our economy becoming a slave to foreign countries? With this much debt, the lenders have the power to affect the value of our currency/markets.
Does anyone have any further thoughts on this?
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"Have we been living beyond our means????"
ReplyDeleteI don't know about you, Gregory, but I have not. I have not even had a mortgage loan since paying it off fully in 2000 (early when I terminated my first marriage). And before that the only additional "debt" were a couple 2 yr car loans and an educational loan paid off within 5 years. Credit cards are always paid off monthly - and not much use of them since putting VISA and MasterCard on emergency usage only after their refusal to forward customers' money to WikiLeaks.
I'm not rich! I simply do not spend what I don't have (or will not be able to fully pay within a month as when I now use Discover card). I also have a fair amount in fluid reserve for emergencies as well as the asset of my house.
From what I read of statistics, however, there are very many individuals who do not have this mentality of self-responsibility and that is a significant problem, one I contend the US and all governments make heady use of.
Pawn mentality is encouraged by governments: suspicion, fear, hate and dependence. No self-responsibility needed since government will decide and provide care for all - all of this by way of numerous government programs and policies that are part of an astronomical yearly budget that includes debt payments for money previously borrowed to cover previous years. (It becomes almost laughable to try to describe this web of goo....)
No self-responsibility is wanted by government, since that is a characteristic of people who mostly think, question and analyze (to individually varying degrees) and therefore might balk at being pawns - good only as cattle for labor of various types that maintain and promote government power directly or via taxes suitable as cannon fodder to fight the numerous wars begun as part of the fear campaign to further the belief that government is a necessity and prime as domestic enforcers against their fellow pawns. (Forbid the thought that many in the populace should come to question whether a government is truly needed... ah, but they can and such questioning may be starting) It is definitely within the individual capabilities of the vast majority to come to understand this and with the Internet, more and more are within a finger's tap of getting the information.
"If we borrow something, we are now subject to the will of the lender and are forced to comply with their terms."
ReplyDeleteThis is incorrect. All borrowing/lending is done under a mutually agreed contract between borrower and lender. No one is "forced" and the terms of the contract are just as much the borrower's as they are the lender's. Yes, the lender generally originates the terms, but any rational borrower will not accept such terms unless s/he agrees that they are reasonable. If the borrower does not think the terms are reasonable (and thereby agrees to abide by them) then s/he should ask for a different set of contract terms. And if the lender does not agree with the variation, then the borrow should go elsewhere.
Remember that no one *ever* is *required* (and certainly not physically forced) to borrow money. One can always save until one has sufficient funds to purchase outright what one may want to buy and/or to fully finance potential emergency needs. Insurance and charities are a reasonable solution for rare but really catastrophic personal events.
"Every time we pay interest, we are WORKING for the lender - in effect becoming their slave. We must work just to support that debt. Not only has the lender become the master in this regard, he/she is becoming wealthier at the same time."
ReplyDeleteAgain this is incorrect. In fact, one could easily turn it around by pointing out that it is the borrower who is better off, since s/he has the asset that was borrowed (or purchased with the borrowed money) and presumably is gaining the benefit of having/using that asset, while the lender no longer has that asset to use for any beneficial purpose.
No, the borrower is simply working for him/herself and over time recompensing the lender for the value that the borrower has received and is all that time benefiting from. Once again it must be emphasized that the loan contract is entirely voluntary and no master/slave relationship whatever is involved.
With respect to lending and borrowing, far better than quoting the crazy ideas in the bible, is to quote Shakespeare:
ReplyDelete"Neither a lender nor a borrower be,
for loan oft loses both itself and friend,
and borrowing dulls the edge of husbandry."
Thank you for the comments Kitty & Paul
ReplyDeleteI don't think the 3 of us are the problem.. As you said Kitty..
"From what I read of statistics, however, there are very many individuals who do not have this mentality of self-responsibility and that is a significant problem, one I contend the US and all governments make heady use of."
But that does not mean the ills of this society can be fixed by merely spouting facts..
I have (tongue in cheek) lobbied for an isolated island for the storage of stupid people.. that in & of itself would fix the great majority of our problems IMHO.
The problem that arises with that solution is, of course, WHOM decides who is stupid & hence exiled & who is intelligent enough to remain?
We don't want to tip over into fascism..
As to financial institutions, Paul, IMO they have received license from the United States government to legally steal through predatory lending & usury.
Do they tend to take advantage of the very same people I refer to as stupid above? Most certainly but that does not absolve them of their deceitful actions.
So to me the question is do we attempt to protect the mental midgets among us from a predatory state & corporate structure?
Or is it every man for himself?
I, personally, am all for anarchy but it will certainly not be easy getting there.
As for the bible lets save it's historical input for another day.
Here is a little data on debt http://http://www.creditwritedowns.com/2011/08/private-debt-deflation.html
Greg