One of my favorite pieces in the history of this site is a review I wrote in 2010 of Jerry Muller's book Capitalism and the Jews. I was reminded of it this week by one of my own senators, Elizabeth Warren, a Democrat who is running for president. Warren put out an announcement this week promising to "End Wall Street's Stranglehold on Our Economy," using terms like "vampire," "sucking" and "bleeding" to describe what the financial sector is doing to the rest of America.
From my review:
The book by Mr. Muller, a professor of history at Catholic University, consists of a short introduction and four chapters. It's the first chapter, "The Long Shadow of Usury," that's the most enlightening.
"Usury was an important concept with a long shadow. It was significant because the condemnation of lending money at interest was based on the presumptive illegitimacy of all economic gain not derived from physical labor. That way of conceiving of economic activity led to a failure to recognize the role of knowledge and the evaluation of risk in economic life," he writes. "So closely was the reviled practice of usury identified with the Jews that St. Bernard of Clairvaux, the leader of the Cistercian Order, in the middle of the twelfth century referred to the taking of usury as 'Jewing'" says Mr. Muller, noting that the interest rates charged by Jews, "in keeping with the scarcity of capital in the medieval economy and the high risks incurred by Jewish moneylenders, whose loans were often canceled under public pressure, and whose assets were frequently confiscated," ranged from 33% to 60% a year.
It was Karl Marx, who was converted to Lutheranism as a child by his parents, who managed to combine the old blood libel against the Jews with an attack on capitalism. "Capital is dead labor which, vampire-like, lives only by sucking living labor, and lives the more, the more labor it sucks," Mr. Muller quotes Marx as saying in Capital. Mr. Muller goes on, "When Lenin later referred to the necessity of eliminating capitalists because they were 'bloodsuckers,' he was merely heightening Marx's own metaphor."
It is a short leap from this to the work of the Nazi economic theorist Gottfried Feder, who, Mr. Muller writes, "distinguished between Aryan and Jewish forms of capitalism, the former industrial and creative, the latter financial and parasitic."
And a short leap from that to Warren's press release: "Wall Street's success hasn't helped the broader economy — it's come at the expense of the rest of the economy. Wall Street is looting the economy....we need to shut down the Wall Street giveaways and rein in the financial industry so it stops sucking money out of the rest of the economy...the growth of the financial sector undermines the rest of the economy by extracting money from it without producing any real value...the private equity firms are like vampires — bleeding the company dry and walking away enriched even as the company succumbs."
