Loan Amnesty

Jewish law looks askance at the concept of bankruptcy. An obligation which was willingly assumed cannot be absolved simply because the debtor currently lacks the means to satisfy his obligation.1 Nevertheless, Judaism has its own version of loan amnesty:

At the end of seven years you shall make a release . . . Release the hand of every creditor from what he lent his friend; he shall not exact [payments due] from his friend or his brother, because time of the release for the L-rd has arrived -- Deuteronomy 15:1-2.

"When the land laws of Shemitah are observed, the loan laws of Shemitah are observed"The Shemitah (Sabbatical) year is associated with two primary mitzvot: 1) The land must be left unplowed and fallow. All fruit or wild produce which does sprout is rendered ownerless. The owner of the land may partake of them -- as may anyone else who so desires. 2) All personal debts are cancelled.2

During the Second Temple Era, due to prevailing socio-economic conditions, Hillel the Elder established the pruzbul, a loophole which transfers personal debts to the courts, thus making them collectable despite the Shemitah laws. Though the rabbis are not empowered to devise a method that circumvents a Torah precept, the Talmud (Gittin 36a) explains that nowadays the Shemitah loan amnesty is no longer in effect according to biblical law.

A little halachic background is in order here: the observance of many of the Torah's agriculture-related laws -- including the agricultural rules of Shemitah -- are dependent on all Twelve Tribes of Israel living in the Holy Land. Such conditions existed until the 6th century BCE, when the Assyrians conquered the Northern Kingdom of Israel and sent the majority of its population, the "Ten Lost Tribes," into exile. While non- agriculture-related mitzvot remained largely unaffected, the Rabbis deduced from Scriptural nuance that all the laws of Shemitah are inextricably tied to each other. Thus, biblically, Shemitah's loan amnesty is only in effect when its agricultural rules are observed. To quote the Talmud: "When the land laws of Shemitah are observed, the loan laws of Shemitah are observed."

While Shemitah is still observed today by rabbinic injunction, Hillel was empowered to circumvent these laws due to pressing need.

We are all debtors.

We were entrusted with days and years, material possessions and soul powers, talents and skills. In return, G‑d expects to be paid dividends. We must use the time and talents allotted to us to infuse our person, possessions and environs with holiness, thus "presenting" them to G‑d. It is fair to say that most of us have defaulted on this loan -- some in a larger measure than others.

How do we call off the collection agencies and restore our preferred credit rating?How do we arrange for loan amnesty? How do we call off the collection agencies and restore our preferred credit rating?

"When the land laws of Shemitah are observed, the loan laws of Shemitah are observed."

Many of us don't grasp the magnitude of leaving fields unseeded and neglected for an entire year. The reason? It's just another mythical, biblical tale. "Yep, they would leave their fields untouched every seventh year -- that was just after the Jordan split and the walls of Jericho fell..."

A modicum of thought, however, suffices to appreciate the colossal sacrifice this mitzvah entailed; the tremendous faith in G‑d that was required to entrust one's livelihood in G‑d's hands for an entire year. Only someone who has succeeded in making G‑d a real part of his/her life is capable of such a move.

This faith did not go unrewarded:

I will command My blessing for you in the sixth year, and it will yield produce for three years. You will sow in the eighth year, while [still] eating from the old crops until the ninth year -- Leviticus 15:21-22.

Apparently loan amnesty was a fringe benefit.