CAPITALISM AND THE JEWS By Jerry Z. Muller 267 pp. Princeton University Press. $24.95
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The question of why so many Jews have been so good at making money is a touchy one. For hundreds of years, it has been fraught with suspicion, denial, resentment, guilt, self-hatred and violence. No wonder Jews and gentiles alike are so uncomfortable confronting Jewish capitalistic competence. Still, in his slim essay collection “Capitalism and the Jews,” Jerry Z. Muller presents a provocative and accessible survey of how Jewish culture and historical accident ripened Jews for commercial success and why that success has earned them so much misfortune.
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Illustration by Jennifer Daniel
As Muller, a history professor at the Catholic University of America, explains it, much anti-Semitism can be attributed to a misunderstanding of basic economics. From Aristotle through the Renaissance (and then again in the 19th century, thanks to that Jew-baiting former Jew Karl Marx), thinkers believed that money should be considered sterile, a mere means of exchange incapable of producing additional value. Only labor could be truly productive, it was thought, and anyone who extracted money from money alone — that is, through interest — must surely be a parasite, or at the very least a fraud. The Bible also contended that charging interest was sinful, inspiring Dante to consign usurers to the seventh circle of hell (alongside sodomites and murderers). In other words, 500 years ago, the phrase “predatory lending” would have been considered redundant.
Lending at interest was thus forbidden across Christian Europe — for Christians. Jews, however, were permitted by the Roman Catholic Church to charge interest; since they were going to hell anyway, why not let them help growing economies function more efficiently? (According to Halakha, or Jewish law, Jews were not allowed to charge interest to one another, just to gentiles.) And so it was, Muller explains, that Judaism became forever fused in the popular mind with finance. In fact, Christian moneylenders were sometimes legally designated as temporary Jews when they lent money to English and French kings.
As Europe’s official money lenders, Jews became both necessary and despised. The exorbitant interest rates they charged — sometimes as high as 60 percent — only fed the fury. But considering the economic climate, such rates probably made good business sense: capital was scarce, and lenders frequently risked having their debtors’ obligations canceled or their own assets arbitrarily seized by the crown.
This early, semi-exclusive exposure to finance, coupled with a culture that valued literacy, abstract thinking, trade and specialization (the Babylonian Talmud amazingly presaged Adam Smith’s paradigmatic pin factory), gave Jews the human capital necessary to succeed in modern capitalism. It also helped that Judaism, unlike many strains of Christianity, did not consider poverty particularly ennobling.
Most of Muller’s strongest arguments are in his first essay, which draws on everyone from Voltaire toOsama bin Laden to illustrate how the world came to conflate the negative stereotypes of Jews with those of capitalism’s excesses. The book’s remaining three essays deal somewhat unevenly with the fallout of the Jews’ economic success, and in particular the resentment it inspired among history’s economic also-rans. Muller explores, for example, how Jews improbably became associated with both abhorred poles of political economy: hypercapitalism and Communism.
Some Jews had indeed sought refuge from anti-Semitism in the seamless brotherhood imagined by Communism (as others did in the nationalist rebirth promised by Zionism). But in a mostly perfunctoryhistory of socialism in Eastern Europe, Muller argues that “Judeo-Bolshevism” was a myth, promoted perhaps to malign the Communist movement.
Of course, just as often this stigma-by-association has run in the opposite direction: from economic phenomena that commentators have found distasteful, to the Jews (see “Hitler”). But such smears and scapegoating stuck largely because Jews had, for centuries, been thoroughly identified with other capitalist-conspiracy theories.
While this book is ostensibly about “the Jews,” Muller’s most chilling insights are about their enemies, and the creative, almost supernatural, malleability of anti-Semitism itself. For centuries, poverty, paranoia and financial illiteracy have combined into a dangerous brew — one that has made economic virtuosity look suspiciously like social vice.
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