President Biden has announced a plan to reduce and, in some cases, totally forgive student loans.

Now, without getting into the politics of this decision as a government policy instituted in this way, it’s worth noting, as Jews, that this very week’s Torah portion discusses the idea of forgiving loans.  It’s almost like there is some Cosmic Being pulling the strings of the universe Who has a sense of humour.  Maybe He thought this oft overlooked section of the Torah could use some extra attention, so He created a major news story just so we would ask “What is the Jewish perspective on loan forgiveness?”

So… what does the Torah say about loan forgiveness?

At the end of seven years you will make a release. And this is the manner of the release: Every creditor shall release his authority over what he has lent to his neighbour; he shall not press his neighbour or his brother, because the time of the release for Hashem has arrived.

Devarim 15:1-2

So the Torah says that every seven years, all loans made between Jews should be forgiven.  That’s a pretty revolutionary goal.  How can the Torah expect that?  Doesn’t that fly in the face of how loans are designed to even work?  

To understand that, we have to get a greater understanding of how the Torah views loans in the first place.  Let’s check out another place the Torah discusses loans:

You shall not give him your money for interest, and do not give your food for increase.

Vayikra 25:37

Now the Torah is telling us that all loans between Jews should be interest free!  People say Jews make good bankers, but I have a feeling if I made these suggestions at any bank, they would laugh me right out the door.  

Loans interest free AND forgiven every 7 years?  You don’t have to be a master businessman to see that this is not a good investment.  A bank that did this would bleed money until it died.

So what on earth was Hashem thinking when He wrote this in the Torah?

We need the context provided for why we would give loans in the first place, just a couple lines earlier:

And if your brother becomes poor, and his means fail near you; then you shall strengthen him, proselyte or resident, so that he may live with you.

Vayikra 25:35

• First, the Torah is telling us that you should look at your fellow Jew, even one who isn’t closely related to you, as your “brother.”  
• Second, if your brother was hard on cash, you wouldn’t look at this as a business opportunity to make money off the guy, you would help him because you want to help your brother.

In other words, loans between Jews aren’t meant to be an investment at all, they are meant to be a form of charity.  And if the creditor is having trouble making payments 7 years later, maybe rather than having his nose rubbed into it, he could use a little additional charity…  

And as a reward for keeping these mitzvos, the Torah says:

For the Lord, your God, has blessed you, as He has told you: you will lend to many nations, but you will not borrow…

Devarim 15:6

Because, lest you get confused, you want to be the type of person who gives to others, not the type who needs to receive.  You want to be the type of person who helps others even if it costs you something, not the type of person who looks at everyone they see like a business transaction.  

May we see each other as brothers and not as dollar signs, and may we be blessed to be the first in line to give a helping hand to those in need.

Good Shabbos,

Rabbi A