The Jews

A Background

Jews as a community are reviled and bad-mouthed across nearly all countries where they live. My first encounter with this community was in the novel, A Stone for Danny Fisher, where the protagonist remembers being bullied as a child in New York just because he was a Jew, and being totally bewildered on that count – and so was I. Later I came across other historical and current accounts of Jew-baiting. Jews are also supposed to have super-human intellect and other qualities with the community having contributed to a large numbers of scientists, philosophers, economists, doctors, sportsmen etc both in Europe and in America.

But both the conceptions fly in the face of basic finding in psychology that human nature is common to all human beings and their talents and intellect are normally distributed. Shakespeare put it very graphically and forcefully in The Merchant of Venice, in which Shylock, a Jew money-lender puts up his defence in these terms. “I am a Jew. Hath not a Jew eyes? Hath not a Jew hands, organs, dimensions, senses, affections, passions? Fed with the same food, hurt with the same weapons, subject to the same diseases, healed by the same means, warmed and cooled by the same winter and summer as a Christian is? If you prick us, do we not bleed? If you tickle us, do we not laugh? If you poison us, do we not die? And if you wrong us, shall we not revenge?”

Again, an aboriginal hunter in the Kalahari who can track and identify from tracks in the desert sand as to the identity of a person or animal which made those tracks can be considered of as high intellectual capacity as the top-most theoretical nuclear physicist. It’s only a question of identifying the intellectual capacity, as George Stigler put it succinctly, “in a regime of ignorance Enrico Fermi would have been a gardener, Von Neuman a check-out clerk in a drugstore”. So how come Jews are considered superior intellectually to others.

To get to the roots of how and why Jews picked up such an unhealthy reputation, we need to take a detour – into of all things - the time value of money!

A Detour – Time Value of Money

As everybody knows and acknowledges, a rupee today is worth more than a rupee say one year from now. The reason being that a rupee today can be invested in some kind of productive purpose which may possibly yield a positive return. Even if the holder of a rupee today has no productive use of the funds, he can always lend it to someone who has. Say, the borrower is able to use his skills and talent to generate a return of 18% per annum after meeting all expenses, including his labour. It would always be beneficial for him to borrow the rupee at any rate below 18% per annum since he would have always have a surplus over his borrowing cost. In effect, time value of money is a natural and logical feature of money– something like gravity – life would be practically inconceivable without taking into account the time value of money! It is beyond imagination as to how would human society function, leave alone prosper, if the time value of money is not explicitly accounted for in daily life.

At the same time, interest, has a dirty sound to it for very many people to the extent that it is prohibited both in Christianity and Islam.  We Hindus are different since we are much more pragmatic and explicitly incorporated risk in our analysis, and in addition have a magic called caste. As per Dr. Y V Reddy, the ex-RBI Governor, “According to Manu and Vasistha, the interest rates were not to vary depending on the risk involved or the purpose for which the money was borrowed. But, they were directly linked to the caste classification of the borrowers. Brahmin was to be charged 2 per cent, Kshatriya 3 per cent, Vaishya 4 per cent and Shudra 5 per cent per month. However, Chanakya’s interest rate structure was risk-weighted since the rate of interest increased with the risk involved in the borrowers’ business. The interest rate worked out to be 15 per cent per annum for general advances. The traders were charged a rate of 60 per cent per annum. Where the merchandise had to pass through forests, the traders had to pay 120 per cent per annum while those engaged in the export-import business handling sea-borne cargo had to pay 240 per cent per annum.”

Back to our story

Now since it is virtually impossible for human societies to function without borrowing and lending money and also handling such funds need special skills, various social groups developed in different parts of the world in the business of money lending. The Jews were natural money lenders since their religion permitted it in the Middle East and they later spread throughout Europe and later to the Americas. Similarly, various social groups developed skills in money lending and spread in other regions. For example, Gujaratis in Africa, Tamils and Chinese in South East Asia, Marwaris all over Indian sub-continent and Afghans in pockets of North India – and life went on for centuries.

However, about 500 years ago the Jews started getting lucky. Europe, which was one of the main areas in which Jews operated their traditional profession, started to develop and modernize with increasing speed with the coming of the Industrial Revolution there. This led to increasing accumulation of wealth in these areas. The increased scale of manufacturing and trade needed larger and larger amounts of capital, a large part of which was provided by the Jew bankers, which made them wealthier and wealthier over time. With wealth came education and social prestige. The education helped in funding and nurturing the legions of Jewish scientists, philosophers, economists etc. The wealth and social prestige invited jealousy and hatred, which was greatest in areas which had seen the most economic growth – Western Europe. The Middle East saw little growth till recently, and Jews continued to live across their traditional areas such as Egypt, Levant, Iraq, littoral states of the Persian Gulf etc. as they had lived over the ages – in comfortable co-existence with other social and religious groups. And in this historical circumstance lies the ill reputation that Jews have unwittingly got built around themselves!

The irony lies in the fact, that Jews, Christains, and Islam share very many common cultural and religious symbols and practices. They all are part of what is known as the Abrahamic religions, with all the Prophets of Jews being acknowledged as Prophets by the Christians, and again all the Prophets of the Jews and Christians being considered as Prophets by the Muslims! But the reverse is not true and that is where the clash begins.

Similarly, restrictions on the consumption of pork are common particularly in the Middle East amongst both Jews and Muslims. Even some Christain sects, such as, Seventh-day Adventists Eritrean Orthodox Church, and the Ethiopian Orthodox Church also disfavor consumption of pork and consider it taboo.

Some Concluding Remarks

The power of bankers and banking should never be underestimated. Just consider WW I & II. The cause of both these wars was need to prove their superiority by the imperialist powers. In Europe all the main powers were either fighting with each other or trampling over the rest. No country was left unaffected – except one – which was small and virtually in the centre of all the fighting and had no army or other protection worth the name. But their defining strength was that they were bankers to all the countries involved in the Wars. The country is Switzerland.

It is through the control of banking in Europe and America and the associated wealth, that Jews continue to hold disproportionate power across the world, which in turn gives them substantial political power. So much so, that all the Arab powers with their vastly larger populations and plenty of oil money have not been able to displace tiny Israel, which is surrounded on all sides by extremely hostile neighbours.