Rethinking capital and interest

Reading time: 11 minutes

Rethinking capital and interest

For thousands of years, the Abrahamic religions have expressed concern over and even prohibited collecting interest. They have mainly regarded interest as an economic concept. Yet, sociologist Pierre Bourdieu famously suggested capital can take economic, social and cultural forms.

This article was written in preparation for our round table on interest and morality.

Expanding our understanding of capital and interest with Pierre Bourdieu
Pierre Bourdieu was one of the 20th century’s most eminent sociologists, who developed an approach to sociology that seeks to account for the highly integrated sets of relations in human society. Bourdieu showed how the concept of capital found in economics and economic philosophy applied to a wider range of human activities, institutions, habits, and spheres of consideration. He suggests that there are three main types of capital: economic, social, and cultural.[1] Economic capital includes things like currency, property, the means of production, labour, trade, debt, interest, banks, and economic laws.

Social capital is the sum value of social relations an individual, family, collective group, or institution has with other individuals, families, groups, and institutions. These social relations involve things as simple as access to a person, favours given or owed, and recommendations. Cultural capital takes on many different forms as it relates to various features of cultural production: things like education, art, prestige, technology, information, science, religion, and legal systems.

Bourdieu saw the need to expand the concept of capital to other types while doing anthropological research among the Kabyle in Algeria. In particular, he noted that strictly economic transactions existed among the people. But more importantly, that other transactions occurred outside of its strict confines and involved types of loans whose interest or value was not met in economic terms.[2] In this sense, Bourdieu exposes that not only is the nature of economic capital more complex than monetary profit, but that in many cases the repayment being charged is not even monetary in nature. That is, a generous loan/gift to a struggling member of the village might not come with any fiscal repayment, but with repayment taking the form of a favour or political loyalty. The return is non-monetary in nature, but it is still expected. As the goods and services available for exchange are highly variable and not always economic in nature, so are the types of capital used in the exchanges. Likewise, transactions in any form of capital can charge any capital as repayment and/or interest.

In social interest, Sarah introduces John to James and expects that John introduces her to Jane in the near term, but expanding to also Alex and Jennifer as time passes. In cultural interest, university A recognises qualification X of university B expecting that university B will recognise university A’s qualification Y. University A charges interest by three years later forcing university B to also recognise qualification Z. Expanding our understanding of capital and interest means we must simultaneously broaden our consideration of the nature of usury.

Can you have non-monetary usury?
In the Abrahamic religions, there is an established concern over the concept of economic interest.[3] In fact, for much of the history of these religions, charging interest (at least to those members of the same religion) was strongly and expansively prohibited.[4] [5] [6] Charging interest was considered the sin of usury. This forces us to consider: if economic usury is morally problematic, what about non-economic interest? Is there any biblical precedent for widening our understanding of interest beyond the economic? In fact, there is biblical precedent for expanding our understanding of interest beyond merely monetary charges. Deuteronomy 23.20-21 reads: “Don’t charge your brother interest, whether interest in the form of money, interest in the form of food, or interest in the form of anything that someone can charge as interest. To a foreigner you can charge interest, but don’t you ever charge interest to your brother, so that Yahweh your God will bless you in everything you put your hand to in the land where you are entering to possess.”

Two things are relevant to our consideration of interest here. First, the passage explicitly expands interest beyond the most common forms of economic capital, money and food, to include any kind of capital. While surely this could be applied to staples like oil, wine, sheep, etc., it is intentionally vague and intends to leave the additional types open, specifically because the forms that capital can take are so variable. In other words, the point is to make the prohibition as inclusive as possible. In a nearly Bourdieusien move,[7] it is the set of relations established between parties that are problematic, not simply the nature of the particular capital involved.

Second, one could argue that the social contract involved between the lender, the debtor, and God was one of mixed capital. While the lender and debtor are joined economically, they are also joined socially and culturally. Their relationship within the community maintains reciprocal social debts to honour and love one another. Further, the social and cultural capital value of this relationship always outweighs the economic capital value.

Similarly, following the prohibition establishes a social relationship between the lender and God, in which God could be seen as paying the interest on behalf of the debtor to the lender in the form of a future favour, that is in social capital. Yet, social capital is the intermediary stage, but the final repayment form is a vague ‘blessing’. It could be economic, social, or cultural. A loan then could be in any of the capitals (presumably repaid in kind) between two human parties, but with God being seen as the surety for both the lender and borrower. Potentially, one could even construe an implicit understanding of the lender as themself a borrower, if one understands that whatever capital they had is from God. Likewise, while the blessing is promised to the lender who does not lend with interest, the withholding of blessing could be considered the calling in on the debt of the lender which received their surplus from God by grace.

It is important to remember from this perspective that God has distributed all things to all people by grace, that is not on the basis of effort or deservedness. But God as non-contingent being also retains ‘control’ or ‘ownership’ of all things. Their distribution is in many regards (as far as God is concerned) ‘arbitrary’ allotments. Grace is the only way to have anything. However, if one does not receive them by grace, but presumes them as an entitlement, expressed in an unwillingness to express grace oneself, then the gift of grace is resignified according to the perceptions of the gifted (the lender) as that which they have apart from grace. The lending, after all, was God’s grace. Further, God is content to allow the lender to assume this false perception in order to subvert it. Thus the ungracious lender has removed themself from grace and (perhaps unwittingly) converted their grace into debt, a debt which – because in reality it is conferred on the basis of grace – they can never repay. In this way, God would force the lender back towards grace through debiting the grace and then gracing the debt.

Grace always reigns even in debt by integrating justice to provide the conditions required that all return to grace. In this sense justice forces humanity to grace and His grace moves God to justice. Grace makes more grace possible, extending into the possibility of reward for grace and justice. Consequently, while all have all by grace, simultaneously by lending generously and non-oppressively to the poor one depends upon the Christ for greater grace, so that by justice and by grace God blesses. A loan to the poor is a loan to the Lord (cf. Prov 19.17), but likewise grace to the poor is grace from the Lord, but to both borrower and lender.  Thus, it seems that not only is there precedent for expanding our understanding of forms of capital as well as interest, but the prohibition against usury demands it as it forces into the spiralling dialectic of justice and grace. Justice demands non-oppressive loans to a brother because it assumes all humanity is predicated on God’s grace. All that we have is on loan to us, so to speak. Usury, therefore, rejects both justice and grace.

Who are the socially and culturally poor?

Usury is a form of oppression, but it cannot be considered to be limited to exclusively the economic realm. It must include the diverse forms of capital. The trouble is, some might posit, that while we can easily see who the economic poor are, is it possible to easily see who are the socially and culturally poor?  

Two responses. First, often there are high degrees of correlation between one form of poverty and the others.[8] Thus, part of what it means to be ‘poor’ is to lack not just economic means, but also social and cultural means.[9] [10] [11] [12] [13] [14] A poor person often faces trouble paying their bills, social isolation,[15] and worse educational opportunities and outcomes.[16] [17]

Second, while often correlated, possession of the forms of capital are not always correlated. It is possible to have varying degrees of the diverse forms of capital. Someone could have middle-class economic capital, but lower amounts of social capital and higher amounts of cultural capital. For example, someone went to a prestigious university and now owns and operates a small business, but remains socially snubbed by many on the basis that their uncle was an infamous war criminal.

Being socially poor means having fewer beneficial social connections. This could be from guilt by association as above, or it could just be from living in a rural area or even being too busy or introverted to expand one’s social network. Similarly, being culturally poor can be from having less valuable (to the dominant in society) educational background, but it could just as easily come from having a discriminated ethnicity, ‘poor taste’ in art, or ‘inappropriate’ religious values.

What is social and cultural usury?
Social and cultural as well as economic usury is simply leveraging one’s relative wealth in any or all of those areas in an oppressive way, expecting a significant repayment beyond the borrowing party’s ability to reasonably repay. This violates justice by working to keep the poor indebted to the loaner. The danger with usury economically is that it can do more than bankrupt the poor economically.[18] To the extent that social and cultural capital correlate to economic poverty as noted above, usury risks bankrupting them socially and culturally as well. Social usury likewise always keeps a person beholden to another person or institution, where loyalty does not have to be earned or even maintained, rather it can be imposed. A person under an usurious social debt is never able to fully repay the owed favour. This for example is how some dysfunctional institutions control their employees. People feel too guilty to leave.[19]

Culturally, one can effect usury by continuously inflating the qualifications needed for a particular position, changing just enough that year over year the culturally poor are always locked out from being fairly considered.[20] [21] [22] [23] Similarly, acceptance and praise of a particular ethnicity can be contingent on their ongoing willingness to parrot the cultural values of the dominant members in the culture. For example, cultural acceptance can be contingent on abiding statues of racist figures.[24] [25] In French schools, secular culture is demanded for acceptance in the ban on yarmulkes, crosses, and burqas.[26] [27] [28] In Iceland and Denmark cultural expectations have led to calls to ban circumcision.[29] [30] [31] [32] At a more institutional level the EU parliament recently critiqued Polish abortion laws (as a manifestation of cultural attitudes).[33] [34] 

Obviously, for many people these topics are remarkably controversial. But that is the point. These are expressions of diverging sets of cultural values. Which values win out and what it takes to be accepted by the dominant holders of cultural power is contingent. In Poland, for example, those with cultural capital seem to demand the rejection of abortion to have access to cultural influence, but in the EU parlement the reverse is true. Consequently, cultural usury can be the hardest to see or admit. It is precisely because it forces one to recognise in-group/out-group dynamics. It also requires facing the possibility that one’s positions are not merely the reflection of the intrinsic morality or value of a given situation (though intrinsically good values exist). Rather it could be merely a reflection of power and cultural capital inequity.

A world without usurious interest?
All human beings are under an umbrella of grace. All of us find ourselves with the allotment of economic, social, and cultural capital that we have by grace, at least to some extent. The problem with usury is that it does not take into account grace or justice, but sees one’s personal set of advantages as an opportunity only for personal gain, rather than common benefit and improvement. Likewise, it only assumes one’s efforts for outcomes, rather than recognising that what could appear as a short-term loss could work to a long-term gain. Even if one was not prepared to believe in a future reward or cosmic-interest from God, then one could imagine how orienting towards one’s wealth through the lens of grace could result in the common benefit of humanity for the coming generations with a society that enjoyed greater equity between the rich and the poor.

Human beings deserve a life free from oppressive relations with those who have the capital, whether economic, social, or cultural. The question is whether human individuals, institutions, and societies will be willing to rethink capital and interest beyond questions of cash and profit to holistic and collective human flourishing by integrating justice and grace.

R. Anthony Buck

To all news items ->

What do leadership, tolerance, and tension have to do with each other? Find out more on the EARS Dashboard.

[1] Pierre Bourdieu, ‘Forms of Capital’, Handbook of Theory and Research for the Sociology of Education, ed. John G. Richardson (New York, 1986): 241-58.

[2] Pierre Bourdieu, Outline of a Theory of Practice, trans. Richard Nice (Cambridge: Cambridge University Press, 1977), cf. esp. pp.176-183, 192-97.

[3] Please consult our introductory article to this roundtable.

[4] Interest-Free Loans in Judaism

[5] Islamic finance – the lowdown on sharia-compliant money.

[6]  Ian Harper and Lachlan Smirl, “Usury”, The Oxford Handbook of Christianity and Economics, ed. Paul Oslington (Oxford: Oxford University Press, 2014), pp. 565-79 (DOI: 10.1093/oxfordhb/9780199729715.013.030).

[7] Pierre Bourdieu and Loïc J.D. Wacquant, An Invitation to Reflexive Sociology, (Chicago: University of Chicago Press, 1992), 96: “[The use of open concepts] is, to be more precise, a permanent reminder that concepts have no definition other than systemic ones, and are designed to be put to work empirically in systematic fashion. Such notions as habitus, field, and capital can be defined but only within the theoretical system they constitute, not in isolation. … What is true of concepts is true of relations, which acquire their meaning only within a system of relations.”

[8] Pierre Bourdieu, Distinction: A social critique on the judgement of taste, trans. Richard Nice, with introduction by Tony Bennett (London: Routledge, 2010), xxiv-xxv.

[9] Robert Walker, “Multidimensional poverty”, Routledge International Handbook of Poverty, ed. Bent Greve (London: Routledge, 2019): 33-48.

[10] Robert A. Isaak, The Globalization Gap: How the Rich Get Richer and the Poor Get Left Further Behind (Pearson, 2004), ebook isbn 9780131428966. Cf. esp. Ch. 7.

[11] Nihaya Daoud, Patricia O’Campo, Kim Anderson, Ayman K. Agbaria, and Ilana Shoham-Vardi, “The Social Ecology of Maternal Infant Care in Socially and Economically Marginalized Community in Southern Israel”, Health Education Research 27, no. 6 (2012): 1018-030.

[12] Wim Van Lancker and Julie Vinck, “The consequences of growing up poor”, Routledge International Handbook of Poverty, ed. Bent Greve (London: Routledge, 2019): 96-106, cf. esp. 100 citing a 2018 in Denmark: “…growing up poor with low-educated parents has stronger negative effects than growing up poor with high-educated parents. It is hypothesized this is because high-skilled parents can more easily compensate for their lack of monetary resources through borrowing or relying on their social network.”

[13] OPHI’s Missing Dimensions of Poverty

[14] Bourdieu, Distinction, 257-64, 318ff.

[15] Carina Mood and Jan O. Jonsson, “The Social Consequences of Poverty: An Empirical Test on Longitudinal Data”, Social Indicators Research 127 (2016): 633–652.

[16] Gillian Parekh, Isabel Killoran, and Cameron Crawford, “The Toronto Connection: Poverty, Perceived Ability, and Access to Education Equity”, Canadian Journal of Education / Revue Canadienne De L’éducation 34, no. 3 (2011): 249-79. Accessed January 27, 2021.

[17] Bourdieu, Distinction, 388-89.

[18] Brian T. Melzer, “The real costs of credit access: Evidence from the payday lending market”, The Quarterly Journal of Economics 126, no. 1 (2011): 517-55. Accessed January 27, 2021.

[19] Company loyalty: You don’t owe your employer a lifelong commitment.

[20] ‘My degree is next to worthless’

[21] I sell degrees – but don’t tell students they might be worthless

[22] ‘Degree inflation’ — like grade inflation — hurts workers as it does employers.

[23] Pierre Bourdieu, Homo Academicus, trans. Peter Collier (Cambridge: Polity Press, 1988), 170.

[24] Edward Colston statue: Four charged with criminal damage

[25] Leopold II: Belgium ‘wakes up’ to its bloody colonial past

[26] Burqa bans, headscarves and veils: a timeline of legislation in the west

[27] The Islamic veil across Europe

[28] Face masks now compulsory in France, but burqas, niqabs, still banned

[29] What’s behind the reluctance to ban circumcision?

[30] Danish parliament to consider becoming first country to ban circumcision of boys | The Independent 

[31] Iceland law to outlaw male circumcision sparks row over religious freedom

[32] Seth D. Kaplan, “Case Study: Male Circumcision in Europe”, Human Rights in Thick and Thin Societies: Universality without Uniformity (Cambridge: Cambridge University Press, 2018): 134–61 (doi:10.1017/9781108557887.008).

[33] Polish de facto ban on abortion puts women’s lives at risk, says Parliament | News

[34] MEPs condemn Poland’s abortion law