We Have Got to Talk About Usury (Part X): Luther—His First Foray, in Translation
Reformation window from the former headquarters of Lutheran Brotherhood, now Thrivent.
The following post is the tenth in a series on usury by the Rev. Vincent Shemwell. Rev. Shemwell serves as pastor of Bethlehem Lutheran Church in Johnson City, Tennessee. He graduated from Concordia Theological Seminary in Fort Wayne with the M.Div. in 2022, and received his STM from CTSFW in 2024, writing his thesis on Johann Georg Hamann. The previous installments can be found below:
Part I: Introduction
Part II: The Old Testament
Part III: The New Testament
Part IV: The Church Fathers—Clement of Alexandria through Hilary of Poitiers
Part V: The Church Fathers — The Cappadocians
Part VI: The Church Fathers — Church Councils and Ambrose
Part VII: The Church Fathers—Chrysostom through Leo the Great
Part VIII: Medieval Theologians
Part IX: The Medieval Church Continued—Councils, Canon Law, Dante, and Other Matters
For the next several parts of our series, we will turn our attention to Luther’s writings on usury. Although Luther addressed the subject in a number of works and letters, three texts in particular are worthy of study: his 1519 Short Sermon on Usury (WA 6:3–8), his 1520 Long Sermon on Usury (LW 45:273–310), and his 1539 To Pastors, That They Should Preach Against Usury (LW 61:284–328, Kindle). In addition, we will consider the broader questions and controversies that emerged during Luther’s lifetime concerning usury, in particular the “usury controversy” (Wucherstreit) of 1523 dealing with fellow evangelical pastor, Jakob Strauss.
For this very first installment on Luther, I am presenting my own translation of his Short Sermon on Usury, which—to the best of my knowledge—has not previously been rendered into English. This will provide a fitting point of departure for the investigation that follows.
God willing, we shall continue that examination in the next part of our series.
Stay tuned.
Notes from the Translator
The following sermon marks Luther’s first engagement with the question of usury: his Kleiner Sermon von dem Wucher. In the years leading up to 1519, Luther had witnessed a substantial expansion of trade and commerce in Germany. With this expansion came a heightened demand for money, and consequently the business of moneylending began to flourish. Up to this time, however, the Roman Catholic Church, faithful to both Scripture and the patristic witness, continued to condemn lending at interest. But already by 1514, Johann Eck, urged and supported by the banker Jakob Fugger—perhaps even bribed by him—had publicly defended the charging of up to five percent interest, and he continued to uphold this position in subsequent public disputations. What is particularly noteworthy is that the church did not formally condemn Eck for this, despite the fact that canon law itself required his teaching to be censured as heretical. Clearly, a shift was beginning to occur in relation to the long-standing prohibition of usury.
Luther was likely not provoked to compose this sermon in direct response to Eck. Rather, he was deeply troubled by the economic instability he observed around him and by the plight of those suffering at the hands of moneylenders, especially those peasants in the years leading up to 1519 who had taken out burdensome loans after a series of devastating crop failures. Motivated by this concern, in his initial treatment of the subject, Luther unambiguously aligns himself with the traditional position, which regards the prohibition of lending at interest as a moral law, first enjoined in the Old Testament and then reaffirmed for the Christian in Matthew 5 and Luke 6. For Luther, all interest-bearing loans are sinful. Indeed, he adhered to this conviction throughout his life. Some scholars, however, have been misled on this point, likely owing to Luther’s somewhat evolving view concerning a particular financial product called Zinskauf.
Zinskauf, translated here as “the purchase of rental income,” was a distinct and somewhat complex arrangement, essentially a real estate deal, formally approved with certain conditions by Pope Martin V in 1425 and again by Callixtus III in 1455 (see the introduction to To Pastors; LW 61:279–80). In this arrangement, the one advancing the money was deemed the “purchaser,” acquiring a right to rental income, while the recipient of the money was considered the “seller,” transferring this right. In practice, when a landowner needed funds, he would “sell” a portion of his land’s future yield of crops, pledging the land itself, or a portion of it, as collateral. The lender, in turn, “purchased” the right to receive this ongoing rental income until the debt was repaid, usually with some return.
Many theologians of the period objected to this financial product, perceiving its susceptibility to abuse and its potential to merely conceal usury. Luther, too, recognized this danger, a fact made clear by his concluding remarks in the sermon. Yet he did not actually regard the purchase of rental income as a loan. For this reason, solely in cases where buyer and seller were both in dire need and risk would be shared (i.e., the buyer would share the risk of a crop’s failure), he held that the determination of an acceptable rate properly belonged to “the judgment of the jurists.” Nevertheless, he cautioned against rates exceeding six percent and insisted that if people were to obey Christ’s command and example faithfully, this financial product would have no reason to exist.
On this matter, some scholars seem to have greatly misconstrued Luther’s position. Up through the final years of his life, Luther remained firmly opposed to all interest-bearing loans, no matter the rate. Even when he appeared to recommend certain rates in private, his argument was advanced solely as a means of preventing a greater evil (i.e., the toleration of more extortionate rates) and cannot rightly be construed as an endorsement of interest itself. Over time, however, Luther did make a few explicit concessions with regard to the purchase of rental income (as with Notwucher, or “usury out of necessity,” which we will get to later), precisely because he did not classify this contract as an interest-bearing loan. But even with the purchase of rental income, Luther acknowledged that in many—if not most—cases it ultimately served the same purpose as usury, which he also makes abundantly clear in his concluding remarks to this first sermon.
Finally, this sermon was likely composed sometime prior to December 1519. Early the following year, Luther elaborated on it in what is now known as his Long Sermon on Usury. Four years later, he incorporated this sermon, albeit in a slightly revised form, into his treatise on trade, published in the American Edition under the title Trade and Usury. With one exception, the scriptural references in the following translation were not newly rendered but were taken directly from the New King James Version. The exception is Luther’s reference to Luke 6:31, where he appears to add several words to the text.
A Sermon on Usury by Doctor Martin Luther,
an Augustinian Friar at Wittenberg (1519)
First of all, it must be known that our Lord Jesus Christ, in the fifth chapter of Matthew’s gospel, when He teaches His people how they should conduct themselves toward one another with regard to temporal goods, in giving and lending, He sets forth three different degrees. The first is this: when someone takes something from us by force, we should not only let it go, but we should also be ready, if he would take still more, to let that, too, be taken. Thus, He says (Matt. 5:40): “If anyone wants to sue you and take away your tunic, let him have your cloak also”—that is, you should not resist or defend yourself, so that he does not also take your cloak. And this is the highest degree in this matter. The second is this: that one should give to everyone who has need and asks for it. Concerning this He says (Matt. 5:42): “Give to him who asks of you.” And the third degree is this: that one should willingly and gladly lend or loan, without collateral or interest, regarding which He says (Matt. 5:42): “And from him who wants to borrow from you do not turn away”—that is, do not refuse him.
This third and last degree is the least, so very low that it is even commanded in the Old Testament to those poor, imperfect people, the Jews; and yes, even the second degree as well. As it is written in Deuteronomy 15 (vv. 7–8): “If there is among you a poor man of your brethren, within any of the gates in your land, you shall not harden your heart nor shut your hand from your poor brother, but you shall open your hand wide to him and willingly lend him sufficient for his need, whatever he needs.” Likewise, the second degree in the same chapter reads (v. 11): “For the poor will never cease from the land; therefore I command you, saying, ‘You shall open your hand wide to your brother, to your poor and your needy, in your land.’” Now, since God commanded and willed in the Old Testament these two degrees, that each should regard the other as his brother, and that no one among them should be allowed to beg or suffer want, as He says in Deuteronomy 15 (v. 4): “May there be no poor among you”—how much more ought the Christian people be bound to this, and even more highly, that they should treat one another as brothers in lending and giving, and, furthermore, that they should also be ready to let go of whatever is taken by force! And thus, there should rightly be no beggar among Christians, far less even than among the Jews.
But if one wishes to keep this command, one must further take care that in a particular city one does not give to all strangers and outsiders. Therefore, He sets in His command that little phrase: “in your land”—so that in each and every city the needy among the inhabitants of that same city should be cared for. Now begging has become so widespread—not to mention the Camino de Santiago, which, in various lands, has been turned into nothing but a way to fill the beggar’s sack—so that it is a wonder how this burden can even be endured. This must all be abolished, and would to God that the authorities recognized the problem and addressed it.
Some think the first degree is merely a counsel, not commanded, and they regard it as proper that each one should defend and protect his own against violence as best he can, but that for those who are perfect it is a command. They say: “If that were true, it would give the wicked license to take and steal, and in the end, no one would manage to keep anything.”
This argument, however, does not hold water: what Christ says is plainly a command, and it is not to be neglected simply on account of wicked men. Indeed, God has instituted the worldly sword for that very reason and entrusted it to the authorities, that they may punish and restrain such wicked men, so that they do not have open license to take whatever they please. And although the Apostle in 1 Corinthians 6 allows the imperfect to demand back their goods through law, nevertheless he rebukes them for not rather suffering loss and fraud than going to law and quarrelling. And if this were not commanded, then the estate of Christians would be nothing higher than that of the Old Testament.
This is moreover clearly stated in Luke 6, where the Lord says: “Give to everyone who asks of you. And from him who takes away your goods do not ask them back. And if you love only those who love you, what credit is that to you? For even sinners love those who love them. And if you do good to those who do good to you, what credit is that to you? For even sinners do the same. And if you lend to those from whom you hope to receive back, what credit is that to you? For even sinners lend to sinners to receive as much back. But love your enemies, do good, and lend, hoping for nothing in return; and your reward will be great, and you will be sons of the Most High. For He is kind to the unthankful and evil.” From these words it is evident that it is proper for Christians to do nothing other than to give and lend freely, and also to do good to their enemies, not to quarrel with them nor to harm them.
Now observe how those behave who lend wine, grain, money, and the like to their neighbor in such a way that they obligate or burden and overload him, so that over the year he must pay interest on the same, or give back more, or something else of greater value, than what he had borrowed. These are little Jewish devices and deceits, and it is an unchristian undertaking, contrary to the Holy Gospel of Christ, and, in fact, against the natural law and right which the Lord points out in Luke 6, where He says: “Just as you want men to do and refrain from doing toward you, you also do and refrain from doing toward them likewise.” There is no one who would not gladly have someone lend to him without collateral or interest; why then does he do the opposite to another? And yet such people go about as pious Christians, praying, fasting, giving alms here and there, endowing this and that. But this Christian work they refuse to regard, even though it wholly and entirely pertains to them.
So you then say: “If lending and borrowing are to be done in this way, then no one will want to lend, for I would lose my interest.” Answer: You may do as you wish, yet you will not overturn the command of Christ, where He commands you to lend to your neighbor without any condition or charge, and if he has need, to freely give to him outright. If you do not do this, then you are no Christian, and you will have already received your heaven here on earth. For it is not your will but God’s command and natural law that must take priority, if you wish to be saved.
So you then say: “If that were true, then there would be very few Christians now in the world, for it has everywhere become a custom that one lends only for gain.” I answer: Whether it be a custom or not, it is neither Christian, nor godly, nor natural. Therefore, when one looks for righteous works, one perceives just how few good trees there are that bear righteous Christian, evangelical fruits, though otherwise people do many extra works which they regard as good, even though they are not commanded to do them. With these same self-chosen works they deceive and blind themselves, so that they neither remember nor recognize divine works.
But you say: “Do not the priests, the learned, those in religious life, and certain churches also do the same, lending only for gain, especially since this profit goes toward the improvement of churches and other possessions?” This excuse is worthy of being ascribed to the evil spirit, for thereby they justify usury, ill-gotten wealth, the harm and oppression of their neighbor, under the pretext of improving churches and other possessions, and would set aside the command of God, as if the church and her possessions had the liberty to tear down God’s command, to rob neighbors, to practice usury, and to commit injustice.
Away with you, accursed wickedness! Shall the blameless church and her clergy defend your vice? Even if the whole world had the practice of lending with the condition of interest and collateral, nevertheless the churches and her clergy ought to speak and act against it; and the more ecclesiastical their possessions are, the more Christianly, according to Christ’s command, they ought to conduct themselves, by lending and letting go. And whoever does otherwise, does it not for the church nor for her ecclesiastical possessions, but for the sake of his own Jewish, usury-addicted avarice, whether he be learned or unlearned, clerical or lay.
Besides these three degrees, there are now other ways of handling temporal goods, such as buying, inheriting, bequeathing, and the like, which are governed by ecclesiastical and civil laws, in which no one’s standing before God is made better or worse. For all Christian dealings and good works with temporal goods are expressed in the three degrees already mentioned: namely, giving freely, lending without condition, and willingly relinquishing goods with love, as has been said. Surely it is no special merit if you buy something, receive it by inheritance, or otherwise acquire it in an honorable fashion, since even the heathen and the Turks can be upright in such a way.
Now let us set aside all these other degrees and take up for ourselves the matter of buying, particularly the purchase of rental income, in which usury is just as much a mighty lord.
This purchase of rental income sometimes happens in such a way that one buys it off those who are in real need, when in fact one ought rather to have lent without charge or simply given to them. Thus, at its core, it is altogether worthless, for God’s command stands in its way and wills that the needy be helped by lending and giving. At another time it happens that both buyer and seller are themselves in need, so that neither is able to lend nor to give, but they must help themselves with the exchange of this purchase. Now when this takes place in transgression of the spiritual law, so that one gives four, five, or six gulden per hundred, it may be tolerated; yet at all times the fear of God must be carefully maintained, that one has a greater fear of taking too much than too little, so that avarice does not break in alongside the security of a legitimate purchase. The fewer per hundred are taken, the godlier and more Christian the purchase is.
It is, however, not my task here to point out whether or where one should give five, four, or six per hundred. I leave that to the judgment of the jurists, whether or where the foundation for the arrangement may be sufficient to justify the taking of six. Yet I am of this opinion: if one wished to keep Christ’s command in the first three degrees, then the purchase of rental income ought not be so common or necessary, except in large notable sums and substantial goods. But this practice has now crept down into groschen and pfennigs, and is prevalent even in very small sums, which one could easily settle with giving or lending according to Christ’s command, and yet no one wants to call this practice avarice.
Now one finds some, who not only charge a percentage with small sums, but also take far too much, seven, eight, nine, or ten per hundred. With these cases, the authorities ought to look into it and intervene. Here the poor common folk are secretly sucked dry and grievously oppressed. Therefore, such robbers and usurers, like tyrants and bandits, deserve—many times over!—to die unnatural deaths and fall into sudden demise, or otherwise come to a dreadful end. For God is a judge for the poor and needy, as He often says in the old law.
Here they go on and say: “The churches and the clergy do this, and they have the authority to do so, since the money goes to the service of God.” In truth, even if one could find no other way to justify usury than this, it is just as much true that this would remain the most wicked excuse of all, since it would drag the innocent church and her clergy down with it straight to the devil and into sin. Take away the name of the church and say honestly: “This is nothing but usury-addicted avarice, or the lazy old Adam, who does not like to work to earn his bread and therefore hides his idleness under the name of the church.”
What is the service of God to me? To serve God means this: to keep His commandments, namely, that one refrain from stealing, from taking increase, from cheating and defrauding, and the like, but instead give and lend to the needy. Do you want to tear down such true service of God, in order that you may build churches, endow altars, and pay for the recitation of prayers and chanting of Masses, which God has never commanded you, and thus, by your so-called “service of God,” nullify the true service of God? Let the service of God which the Lord has commanded you take precedence, and afterward provide for what you yourself have chosen. And, as I said above, even if the whole world exacts ten per hundred, at the very least the ecclesiastical foundations ought to hold most strictly to the law and, in fear, take only four or five. For they ought to shine forth and give a good example to the laity. Instead, they turn it upside down, claiming liberty to set aside God’s command and service, to do evil and to practice usury. Do you want to serve God in your own way? Then go right ahead, “serve” Him by harming your neighbor, while supposing that this somehow fulfills His command. For He says in Isaiah 61 (v. 8): “I, the Lord, love justice; I hate robbery for burnt offering.” Likewise, the wise man says (Tobit 4:7): “Give alms from what is yours.” But such revenues are clearly stolen from your neighbor, against God’s command.
Now if one fears that the churches and institutions might thereby fail, then so be it. I say it is better that out of ten institutions one be made godly than that many be preserved in opposition to God’s command. What good is the supposed service of God, which you hear, if it stands against God Himself, against His command, and against His true service? You cannot serve the one God with two conflicting services any more than you can serve two masters.
There are also some so utterly simple that they recklessly sell off such rental income apart from any productive land or other collateral, or even sell more than the land can actually bear, from which arises manifest ruin. And this matter is quite dangerous and far-reaching, so that it is hardly possible to say enough about it. The best would be that one lean into the Gospel, draw near to it, and deal with temporal goods in a Christian way, as has been suggested.
There is also a dangerous intention in this purchase, of which I fear few—if any—buyers are free. It is the desire to be absolutely certain of their rental income and property, to feel secure in them, and therefore to part with their money and invest it with others so that they no longer remain exposed to risk. They much prefer that others labor with it and assume the risk, while they themselves remain idle and at ease, yet remain or become rich. If this is not usury, it is at least very near to it. In short, it is against God. For wherever one seeks profit from a neighbor that one would not also willingly allow him to seek in return, there love is shattered and natural law violated. I am concerned, therefore, that in purchases of rental income scarcely anyone considers how his neighbor fares, so long as his own rental income and property are secure, though such security is by no means what one ought to seek. And even if the purchase itself does not appear so very bad, it nevertheless betrays avarice or laziness, and remains a sin before God.
For this is the very nature and essence of every purchase: that the buyer should bear the risk with the goods, and not the seller, who has already parted with them. But when the buyer insists on receiving his rental income in full, regardless of whether the seller has suffered loss on the land or the collateral—as so often happens in foreclosure—then the buyer is a robber before God and the world, taking from his neighbor his sweat and blood. For the risk of the land ought to rest on the buyer’s side, that he be as uncertain of his rental income as the seller is of the lump sum he has received through the sale, both being in God’s hand for the sake of their goods.
In sum, I think the purchase of rental income is not technically speaking usury; yet it seems to me that its nature is such that it greatly regrets not being usury, and that only the will is lacking. And so, it must, alas—and most unfortunately!—be considered “legitimate.”