'Extortioners' — a stereotype that stuck

The very next day, the National Advocate pointed out that Sommers was not a Jew. But this did not put the paper off, as a subsequent article explained: "In speaking of Mr Sommers as Jew, we had no sort of reference to his religious tenets… The epithets used in common parlence [sic], however improperly as synonimous [sic] with extortioner - Yet we did not intend to convey any reproach to the Hebrew nation or creed."

There were Jews who charged exorbitant interest, just as there were Christians who ignored the bans put in place by the church

In a cruel twist, not only were these stereotypes rife, but in 19th-century America it was extremely difficult for impoverished Jews to get credit. They were labelled "non-producers" and "predators", according to academic David Gerber and, when applying for credit, would be assessed under such categories as "Good, but Hebrew good" or disparaged with comments along the lines of: "He is a Jew and although in point of fact he may now be perfectly responsible, yet Jews have a wonderful faculty of becoming at almost any moment they choose entirely irresponsible."

As the half-hearted correction in the Evening Post makes clear, not only was it common behaviour to casually dismiss some trades as "Jewish", but the word "Jew" was used as a synonym for "extortioner", with little concern for whether or not there was any link. Such a slur did not come out of nowhere, of course. But the fact that, in the 19th-century New World, old accusations rooted in medieval European history were being made against Jews is testament to the enduring power of the sterotype of the Jewish money-lender.

Two things must be remembered when discussing the subject of money-lending in history. Firstly, where Jews were working as money-lenders in large numbers, it often - although not exclusively - reflected a prohibition on their practising other trades. Secondly, members of the Jewish community were themselves also debtors, in hock to other Jews (despite the prohibition in the Torah) and to Christians alike, dating back to biblical times.

In Deuteronomy chapter 23, we are told: "Unto a stranger thou mayest lend upon usury; but unto thy brother thou shalt not lend upon usury: that the Lord thy God may bless thee in all that thou settest thine hand to." The passage led to the assumption both that Jews were naturally better at finance, and that Jews themselves were not exploited, either as debtors or as tradespeople. Yet, as Benjamin Ravid pointed out in a 1976 academic essay on Jewish merchants, the "role of the Jews in the European economy, especially as money lenders, traders, and taxpayers, is often assumed rather than investigated".

The book of Nehemiah emphasises why further investigation is necessary since, yet again, usury was roundly condemned. At the time, many Israelites found themselves burdened by crippling debts, owed to fellow countrymen, when returning to Jerusalem. Nehemiah, a Jewish high official at the Persian court who had asked the Persian king if he could rebuild the walls of Jerusalem and "purify" the Jewish community, was disgusted by what was taking place. He called out: "Let the exacting of usury stop! Return to them this very day… the interest on money, grain, wine and oil that you have been extracting from them".

Certainly in the medieval period there were Jews who charged exorbitant interest, just as there were Christians who ignored the bans put in place by the church. In any case, Jews were by no means the only money-lenders operating at the time, profitably or otherwise.

to suggest that in the Middle Ages there was any agreement or consistency as to what was acceptable for Jews and Christians regarding business conduct is absurd. In England during that period, English, Flemish and Italian lenders were all in operation and were often working on more lucrative deals than the Jews, who suffered from being stereotyped.

In his study, Shylock Reconsidered: Jews, Moneylending, and Medieval Society, Joseph Shatzmiller noted that in France: "Christians and Italian bankers handled far larger sums than the Jews and catered to a higher class of clientele". Indeed, for all that they might have been able to lend money, their position came with few other benefits and offered little protection.

In 12th-century England, King Henry I took the view that Jewish money-lending would make the country more prosperous. Thus, Jews were granted greater protection overall, and so became temporarily richer. Back then, loans could be turned down because borrowers lacked adequate resources to return the money on time. One way to circumvent this was for the borrower to reveal to the lender what he wanted the loan for. However, most borrowers, for obvious reasons, were reluctant to share such information on the grounds that a potential lender could use it to their own business advantage. But because Jews were barred from the majority of other occupations, Christians tended to be happy to borrow from them even while sharing their plans.

Jewish lenders were protected from having their property confiscated so long as they continued to produce high tax incomes - and this depended on their ability to lend to the king's subjects. So keeping the Jews on side was financially rewarding for the monarch. But the situation was precarious for Jews, who could fall out of favour the moment the special relationship proved anything less than profitable. And when Italian competitors started to enter the English market, the king took the course of confiscating Jewish loans. As soon as the Italians came over, the Jews were yesterday's news.

It is, of course, an irony not lost on history that, having made a name for themselves as money-lenders in England, both because they were barred from other professions and because this set-up was of financial benefit to the King, in the ensuing years Jews were condemned for their money-lending and blamed for the indebtedness of the Christian population. What was at one stage rewarded with protection and a guarantee to stay in the country ultimately became the undoing of the medieval Jewish community of England.

As we can see from a historical account from the 1860s, royal protection did little to dampen wider dislike of the Jews and in particular, of Jewish money-lenders. A writer under the pseudonym of "Britannia" wrote: "all these Fines and many other Losses both in Estate, Limbs and Life, were not sufficient to deter these stubborn People from their iniquitous Proceedings in their Manner of getting Money and of their oppressing the native-born Englishmen and of ridiculing and blaspheming Christ."

Eventually, the royal court had caught up with common sentiment. In 1275, King Edward I issued the Statute of the Jewry, the most important piece of legislation since the formal charter granted by Henry I had given the Jews their protected position in society.

The statute stated: "Albeit that he and his ancestors have received much benefit from the Jewish people in all times past, nevertheless, for the honour of God and the common benefit of the people the King hath ordained and established, that from henceforth no Jew shall lend anything at usury either upon land, or upon rent or upon other thing." It lamented that the Jews had brought Christians into a state of general indebtedness, and ruled that henceforth no loan should be secured "on rents" (the granting of mortgages). The statute continued: "And if any Jew shall lend at usury contrary to this Ordinance, the King will not lend his aid, neither by himself or his officers for the recovering of his loan; but will punish him at his discretion for the offence and will do justice to the Christian that he may obtain his pledges again." The worst was yet to come. After much debate and redrafting of the law, on November 5, 1290 an official statement concerning the "Expulsion of the Jews" was issued by Edward I. They were "banish'd hence".

T he image of the usurer as necessarily Jewish, seen most famously with the depiction of Shylock in William Shakespeare's The Merchant Of Venice, neglects to mention those Jews who historically were on the receiving end of usurious and greedy practices. And while identifying those Jews who operated as money-lenders before 1290 is relatively easy - their official books were available and they were known to the king, which ironically paved the way for their expulsion - far less is known about Jewish clients.

Nevertheless, in looking at the records of a Jewish man by the name of Bonefy, son of Lumbard of Cricklade, a well known money-lender and convicted crook, we can see that, by the end of the 13th century, when money-lenders dealt also in cereal and wool brokerage, one of Bonefy's main debtors was Philip Le But of Cricklade. He owed Bonefy 60 quarters of cereal in 1285.

Philip was a convert who was appointed to collect the Jewish poll tax for the Domus Conversorum (House of Converted Jews, which after the expulsion was among the only way for Jews to remain in England). It was said that Philip, as well as a man called John de Havenak, was tasked with collecting the debts of other Jews because of the "strong belief in the financial skill of the Jew").

Interestingly, not only does this make clear that Jews were given loans by other Jews (albeit, in this case, converted ones), but it challenges the general view that Jews in England were urban, since records reveal that most of Bonefy's clients were rural.

After the expulsion, Jews were not officially allowed back until 1656. There were exceptions - "invisible Jews" in the 16th and 17th centuries, mostly Marrano merchants who formed a secret congregation in London, and built trade links with the East and West Indies, parts of Western Europe, the Canary Islands and Brazil. And, after resettlement, the Jewish population grew. Some brought with them the entrepreneurial spirit to succeed in money-lending and other financial arenas, but others were not so lucky. As Amy Feinstein in her paper on Jewish mercantilism writes: "At the other end of the social and economic spectrum, poor, untrained Jewish immigrants hawked wares that they obtained on credit and bought old clothes, rags, bones, and junk."

From Shylock to Charles Dickens's Fagin, the Jews have been tarred with all the negative connotations of usury, despite often being on the receiving end of usurious lenders. Indeed, throughout history, Jews and Christians have operated as lenders, borrowers and litigants. Sadly, only one stereotype seems to have stuck.

Carl Packman is the author of 'Loan Sharks: The Rise and Rise of Payday Lending' (Searching Finance)