Earlier this week, Justin Welby appeared to declare war on so-called ‘payday loan’ companies, specifically Wonga.com. He claimed he wanted to ‘put them out of business’, not through legislation, but by offering an alternative through Church support of credit unions.
But within 27 minutes of the first story being published, it emerged that the Church Commissioners had indirectly invested some money in Wonga.com. Out of the portfolio of £5.5 billion, some £75,000 was invested in a venture capital company which had passed money on to Wonga.
This could have looked like a classic Church of England media cock-up—had the policy really been thought through? Why hadn’t someone done background checks? Is the strategy at Lambeth Palace linked with the strategy of the Church Commissioners? But in fact, the story has come over as a triumph, and Justin Welby has grown in stature as a result. Listening to the discussion yesterday on Any Questions on Radio 4, I sensed there was near universal support for both the announcement, and the way the subsequent revelations had been handled. Why was this? It’s worth asking, because it has felt to me as though this has been something of a minor watershed in media attitudes to the Church. There are several important strands to it.
1. This issue really matters.
Payday loan companies have seen rapid growth in recent years, and particularly as we go through times of austerity, with real incomes declining, especially at the bottom end of the economic scale. And the practices of the companies involved are truly shocking. Rates of interest are astronomic, typically the equivalent of several thousands of percent per annum, and the business model explicitly assumes that borrowers will not repay when loans are due. Added to that is the rather sickening, cuddly approach to advertising and PR.
2. Justin Welby knew what he was talking about
It was evident in the initial announcement, as well as in the subsequent admission of embarrassment, that Justin Welby really knew what he was talking about. He has worked in business, he understands finance, and he could speak on his own behalf, rather than rely on other people to brief him or advise him. I suspect because of this, he was able to speak in direct and relatively understated tones. This has given his comments both a sense of gravitas, but also a real sense of authenticity and accessability.
3. The Church is acting itself, not pressuring Government to act for it
One of the things that most impressed those on Any Questions was the sense that here was the Church acting on its own behalf, not trying to put pressure on Government to pursue the Church’s agenda for it. Justin Welby was speaking as an independent moral agent, and head of an organisation, not as someone who was having to rely on the anomalies of Establishment to get his way. The Times leader highlights the importance of this:
[I]t is good that Lambeth Palace’s new resident understands that the commandment to “love your neighbour” is addressed personally to every Christian and parish church and not just to politicians and taxpayers. There are many important welfare roles for government but the most transformational compassion is delivered voluntarily, locally and personally.
As we saw in the vote on the same sex marriage Bill, it really is questionable how much power bishops in the House of Lords actually exercise. In both these situations, there is a sense in which Welby has been acting in a post-Establishment mode, and in this case it has worked rather well.
4. Honest admission of mistakes
When it became apparent that the position of the Church was inconsistent, in having investment in Wonga.com, Welby immediately came clean and admitted it was embarrassing. In fact, most people looking on from the outside recognise that this is a miniscule part of the overall Church Commissioner’s portfolio, so the area is not very great, and also that it would be near impossible for Justin Welby to actually check this out. His interview in response to the revelation is very impressive.
So in this episode, we have a Church which is concerned about an important issue, appears to know what it’s talking about, is taking responsibility for action to itself, and is happy to admit mistakes when it makes them. (It has been noticeable how much the media aggregate the Church itself with the person of the Archbishop of Canterbury.)
The proposal itself might or might not be achievable, and my own view is that it’s probably a mistaken strategy. In other countries, interest rates for short-term loans are capped by law, and I don’t see any reason why we shouldn’t do the same (Germany has a 20% cap). But it’s been a positive media experience.
From a theological (as well as social) point of view, this is a vital issue for the Church to tackle. Luke Bretherton, Associate Professor of Theological Ethics at Duke University, wrote a fascinating article on usury in Modern Theology, and has put an extract up on his blog. He highlights some key points often overlooked in the discussion:
1. In Egypt, the Hebrews were there as debt-slaves, and not as captives from war or conquest. This puts questions of financial debt at the heart of the biblical story.
2. In relating to those outside Israel, the question of usury was a political one at least as much as it was an economic one. It was a way in which Israel could redress the imbalance of political power with bigger, militarily strong nations.
3. By contrast, within Israel, usuary was a theological statement. God had provided the land, and continued to own it, whilst Israel were tenents. To lend at interest suggested that the lender (rather than God) owned resources, and that God had not provided for the borrower.
4. Throughout history, the church in Europe has recognised the difference between legitimate charge for the cost of a loan, and excessive charging of interest—contrary to the comments in this slightly half-baked piece
5. The escape from debt of the Hebrews in Egypt (in the Exodus) provided a key model for the language of salvation in the New Testament, which explains in part Jesus’ teaching on the importance of money as a potential rival god.
Bretherton comments on the OT texts:
To convert land or people into fungible [ie exchangeable] goods of no greater value than anything else is not only to instrumentalise them for one’s own benefit, and so place one’s welfare above the good of all, but to usurp God’s title. In modern parlance we call such aprocess “commodification”: the treating of that which is not for sale as a commodity to be bought and sold. The extensive manumission laws of Exodus, Deuteronomy and Leviticus relate to debt slavery and are measures to keep in check such a process of commodification of land and people.
Welby’s initiative is a welcome attempt to ‘keep in check’ just such a ‘commodification’ of those at the bottom of the economic scale in 21st-century Britain.
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