Usury used to mean charging interest of any kind (has since been narrowed to exorbitant rates) and is the definition used in the video. Watching is not a necessity since a synopsis of the argument is listed immediately below - it is mainly provided as a means of verifying the arguments held by some libertarians and other factions.
There are two people in the video: the teacher and the moron
There's only $1,000,000 of currency available in the economy
There are only 11 people left in the world: the lender and 10 borrowers
Initially, the banker has all of the money
Banker loans $100,000 to each of the 10 borrowers
Banker is charging 1% interest (meaning $101,000 is owed)
Total amount to be repaid: $1,010,000 ($101,000 x 10 borrowers)
With only $1,000,000 available, how are they going to repay the loans which total $1,010,000?
There are several problems with the scenario, as it is laid out in the video. First, the 'moron' in the video being taught about the pitfalls of usury was either a colossal idiot or was playing the part so as to push the viewer to the teachers point of view - i.e. if you're not with the teacher, it is because you don't get it and you don't want to be like the moron, do you?
Second, the scenario painted is an unrealistic and unwinnable one. It is unrealistic in that the banker is calling due all debts immediately upon handing them out, and unwinnable because there is no source of income to cover the difference between the loan amount and amount including interest (making both the banker and borrower supremely moronic). In order for the scenario to be realistic, make the loan to be repaid over a longer period of time and in order to make it winnable, have the borrowers working for the banker. The salary paid to the borrowers would more than make up for the $10,000 discrepancy. After all, a dollar isn't destroyed if used to repay a loan but instead goes back out into the economy in the form of salaries, building payment, utilities, more loans, etc.
Third, the teacher is claiming to have rights to the banker and his money. Is the banker not able to choose to loan out his money? Is he not able to ask for something in return since he is risking the loss and forgoing other ways of investing his capital?
Fourth, the teacher is similarly claiming ownership over the borrower. Does a borrower have the liberty to weigh the pros and cons (loan amount, term, APR, income, current bills) and agree to a contract?
Fifth, and finally, my understanding of the Bible's stance on interest is that an individual does not do something in order to get something. Another way of phrasing it is that the Bible is an individual's guidebook to heaven, but not a rulebook on how to run a business or country.
What are your thoughts on this video? Does it have merit to you or do you find it as ridiculous an idea as I do? Also, what are your thoughts on the remedy (printing money for loans) and its consequences?