Capitalism and the Jews

April 11, 2010

The other day I heard a fascinating interview with Jerry Muller, author of a new book called Capitalism and the Jews. I find myself drawn to this subject for two reasons. Firstly, you have the paradoxical love-hate relationship between Jews and capitalism. There is little doubt that Jews have often done very well when they have been allowed to compete under equal conditions in capitalist economies. But they have also been its most virulent critics – Karl Marx and Leon Trotsky immediately spring to mind. We forget it now but Israel was once a darling of the left. The Kibbutz movement is the archetypal example of a collective community, based on agriculture not commerce. The other element that intrigues me is the radioactive nature of the question. The success of Jews in markets has been a blessing for them but it has also been a curse. The idea of Jewish economic power had tragic consequences in the twentieth century and these ideas still remain important even today. Just listen to the words of Bin Laden and Ahmadinejad:

“You are the nation that permits Usury, which has been forbidden by all the religions. Yet you build your economy and investments on Usury. As a result of this…the Jews have taken control of your economy…and now control all aspects of your life.” (Osama bin Laden’s Letter to America in November 2002)

The image of the Jew as an avaricious loan shark has persisted for many years, with its most famous example being Shylock in Shakespeare’s The Merchant of Venice. In The Divine Comedy Dante had moneylenders with blasphemers and sodomites in the seventh circle of hell. They were to be stranded forever on the Plain of Burning Sand where it would constantly rain great burning flakes of fire which would vanish when they hit the ground, but not when they hit the flesh of sinners.

The starting point of my analysis of Jewish economic activity has to be the middle ages and the idea of usury. Nowadays we use this word to refer to charging excessive interest, whatever that means. But in the medieval world, usury referred to lending money per se. In medieval Western Christendom, as in Islamic banking today, money lending was verboten. This was partly for biblical reasons and partly due to the influence of Aristotle. The Greek philosopher believed that money could not create productivity and that it was wrong to charge interest:

The most hated sort [of moneymaking], and with the greatest reason, is usury, which makes a gain out of money itself, and not from the natural use of it. For money was intended to be used in exchange, but not to increase at interest. And this term Usury which means the birth of money from money, is applied to the breeding of money, because the offspring resembles the parent. Wherefore of all modes of making money this is the most unnatural.

 In fact,  Jews weren’t supposed to lend money either but there was a get-out clause in Deuteronomy. They weren’t allowed to lend to other Jews bit they were permitted to lend to gentiles. So just when the European economy was starting to get on its feet, in came the Jews. They filled the void that was left by the prohibition on Christian money lending. They would play a vital role in the rise of Europe but this role did not endear them to the general population or the rulers, who found them the perfect scapegoats when there were economic problems or they didn’t feel like paying back what they owed. Thus they were often expelled (or worse).

What happened when these parasites were expelled? If the activity they were engaged in was so bad, then logically things would be much better without these bloodsuckers. The reality was very different- shortages of credit and general economic decline.

The idea that money cannot be productive and that those who engage in lending it are parasitic is so typical of many economic fallacies. There is a tendency to underestimate the value of mental activity in a successful economy. Thomas Sowell sums it up very succinctly:

Because what is immediately visible to the naked eye makes a more lasting impression than past or present factors invisible inside other people’s heads, it is easy to regard the visible factors as the sole or most important factors, even when other businesses with those same visible factors went bankrupt, while an expertly managed enterprise in the same industry flourished and grew. Nor are such misunderstandings inconsequential. Elaborate ideologies and mass movements have been based on the notion that only the workers really create wealth, while others merely skim off profits, without having contributed anything to producing the wealth in which they unjustly share.

I always find it funny when people talk about the real economy. You have to sweat and get your hands dirty. Farmers and labourers are the ones who do the real work and those who earn their money in other ways are leeches. This seems to be the central premise of Marxism. For Marx basically all economic value comes from labour. And when he discusses labour, he doesn’t seem to appreciate the creative input of entrepreneurs. So in Marx’s account, it’s those with capital, living parasitically—and he uses images of vampirism—off the sweat and blood of those who work by the sweat of their brow. And what is interesting is how often there has been a conflation of the typical anti-Jewish stereotypes with what are considered the worst excesses of capitalism. The language, leeches, bloodsuckers parasites and so on, is used to describe both Jews and capitalism.

And of course Jews have been capitalist’s harshest critics. Jesus, who had a run-in with the moneychangers outside the Temple, could be considered the first in a long line of anti-capitalist Jews. In the late nineteenth and early twentieth century many Jews were attracted to the communist movement. Well. It wasn’t just communism. In general the right were hostile to them and so they had to go somewhere. A few became communists and because of their literacy and other skills they tended to reach disproportionately high positions. So Jews could now be attacked from both sides. Hitler’s anti-Semitism is well known, but Stalin too harboured these sentiments. And Jews were a handy scapegoat when there were problems in the economy.

Capitalism has been the most important force in shaping the fate of the Jews in the modern world.  It has also had an enormous impact on them and on how they are perceived. Some people may feel uncomfortable with the subject but I think it a perfectly legitimate area of study. We cannot leave to those paranoid conspiracy theorists that have been so prevalent since the middle ages. I am not trying to argue that all anti-capitalism is anti-Semitic, but it is an interesting link. And whatever the connection, I do feel that anti-Semitism and anti-capitalism are both fundamentally wrong-headed. That is what I have tried to show in this article.

Top 20 Logical Fallacies

April 11, 2010

A while back I began a series Faulty Thinking about logical fallacies. I didn’t get round to finishing it. But the other day I found this list of twenty at the The Skeptics Guide to the Universe website. Here they are:

Ad hominem

An ad hominem argument is any that attempts to counter anothers claims or conclusions by attacking the person, rather than addressing the argument itself. True believers will often commit this fallacy by countering the arguments of skeptics by stating that skeptics are closed minded. Skeptics, on the other hand, may fall into the trap of dismissing the claims of UFO believers, for example, by stating that people who believe in UFO’s are crazy or stupid. 

Ad ignorantiam

The argument from ignorance basically states that a specific belief is true because we don’t know that it isn’t true. Defenders of extrasensory perception, for example, will often overemphasize how much we do not know about the human brain. UFO proponents will often argue that an object sighted in the sky is unknown, and therefore it is an alien spacecraft. 

Argument from authority

Stating that a claim is true because a person or group of perceived authority says it is true. Often this argument is implied by emphasizing the many years of experience, or the formal degrees held by the individual making a specific claim. It is reasonable to give more credence to the claims of those with the proper background, education, and credentials, or to be suspicious of the claims of someone making authoritative statements in an area for which they cannot demonstrate expertise. But the truth of a claim should ultimately rest on logic and evidence, not the authority of the person promoting it. 

Argument from final Consequences

Such arguments (also called teleological) are based on a reversal of cause and effect, because they argue that something is caused by the ultimate effect that it has, or purpose that is serves. For example: God must exist, because otherwise life would have no meaning. 

Argument from Personal Incredulity

I cannot explain or understand this, therefore it cannot be true. Creationists are fond of arguing that they cannot imagine the complexity of life resulting from blind evolution, but that does not mean life did not evolve. 

Confusing association with causation

This is similar to the post-hoc fallacy in that it assumes cause and effect for two variables simply because they are correlated, although the relationship here is not strictly that of one variable following the other in time. This fallacy is often used to give a statistical correlation a causal interpretation. For example, during the 1990’s both religious attendance and illegal drug use have been on the rise. It would be a fallacy to conclude that therefore, religious attendance causes illegal drug use. It is also possible that drug use leads to an increase in religious attendance, or that both drug use and religious attendance are increased by a third variable, such as an increase in societal unrest. It is also possible that both variables are independent of one another, and it is mere coincidence that they are both increasing at the same time. A corollary to this is the invocation of this logical fallacy to argue that an association does not represent causation, rather it is more accurate to say that correlation does not necessarily mean causation, but it can. Also, multiple independent correlations can point reliably to a causation, and is a reasonable line of argument. 

Confusing currently unexplained with unexplainable

Because we do not currently have an adequate explanation for a phenomenon does not mean that it is forever unexplainable, or that it therefore defies the laws of nature or requires a paranormal explanation. An example of this is the “God of the Gapsâ” strategy of creationists that whatever we cannot currently explain is unexplainable and was therefore an act of god. 

False Continuum

The idea that because there is no definitive demarcation line between two extremes, that the distinction between the extremes is not real or meaningful: There is a fuzzy line between cults and religion, therefore they are really the same thing. 

False Dichotomy

Arbitrarily reducing a set of many possibilities to only two. For example, evolution is not possible, therefore we must have been created (assumes these are the only two possibilities). This fallacy can also be used to oversimplify a continuum of variation to two black and white choices. For example, science and pseudoscience are not two discrete entities, but rather the methods and claims of all those who attempt to explain reality fall along a continuum from one extreme to the other. 


Applying criteria or rules to one belief, claim, argument, or position but not to others.  For example, some consumer advocates argue that we need stronger regulation of prescription drugs to ensure their safety and effectiveness, but at the same time argue that medicinal herbs should be sold with no regulation for either safety or effectiveness. 


In Latin this term translates to “doesn’t follow”. This refers to an argument in which the conclusion does not necessarily follow from the premises. In other words, a logical connection is implied where none exists. 

Post-hoc ergo propter hoc

This fallacy follows the basic format of: A preceded B, therefore A caused B, and therefore assumes cause and effect for two events just because they are temporally related (the latin translates to “after this, therefore because of this”). 

Reductio ad absurdum

In formal logic, the reductio ad absurdum is a legitimate argument. It follows the form that if the premises are assumed to be true it necessarily leads to an absurd (false) conclusion and therefore one or more premises must be false. The term is now often used to refer to the abuse of this style of argument, by stretching the logic in order to force an absurd conclusion. For example a UFO enthusiast once argued that if I am skeptical about the existence of alien visitors, I must also be skeptical of the existence of the Great Wall of China, since I have not personally seen either. This is a false reductio ad absurdum because he is ignoring evidence other than personal eyewitness evidence, and also logical inference. In short, being skeptical of UFO’s does not require rejecting the existence of the Great Wall. 

Slippery Slope

This logical fallacy is the argument that a position is not consistent or tenable because accepting the position means that the extreme of the position must also be accepted. But moderate positions do not necessarily lead down the slippery slope to the extreme. 

Special pleading, or ad-hoc reasoning

This is a subtle fallacy which is often difficult to recognize. In essence, it is the arbitrary introduction of new elements into an argument in order to fix them so that they appear valid. A good example of this is the ad-hoc dismissal of negative test results. For example, one might point out that ESP has never been demonstrated under adequate test conditions, therefore ESP is not a genuine phenomenon. Defenders of ESP have attempted to counter this argument by introducing the arbitrary premise that ESP does not work in the presence of skeptics. This fallacy is often taken to ridiculous extremes, and more and more bizarre ad hoc elements are added to explain experimental failures or logical inconsistencies. 

Straw Man

Arguing against a position which you create specifically to be easy to argue against, rather than the position actually held by those who oppose your point of view. 


tautology is an argument that utilizes circular reasoning, which means that the conclusion is also its own premise. The structure of such arguments is A=B therefore A=B, although the premise and conclusion might be formulated differently so it is not immediately apparent as such. For example, saying that therapeutic touch works because it manipulates the life force is a tautology because the definition of therapeutic touch is the alleged manipulation (without touching) of the life force. 

The Moving Goalpost

A method of denial arbitrarily moving the criteria for “proof” or acceptance out of range of whatever evidence currently exists. 

Tu quoque

Literally, you too. This is an attempt to justify wrong action because someone else also does it. “My evidence may be invalid, but so is yours.” 

Unstated Major Premise

This fallacy occurs when one makes an argument which assumes a premise which is not explicitly stated. For example, arguing that we should label food products with their cholesterol content because Americans have high cholesterol assumes that: 1) cholesterol in food causes high serum cholesterol; 2) labeling will reduce consumption of cholesterol; and 3) that having a high serum cholesterol is unhealthy. This fallacy is also sometimes called begging the question.

My media week 11/04/10

April 11, 2010

BBC World Service’s The Interview features Temple Grandin an animal behaviour scientist who is autistic.  She feels her condition helps her to understand animal behaviour, and thus design better cattle handling equipment so that the animals suffer less.

In Nature magazine psychologist Paul Bloom looks at morality may sometimes change: How do morals change?

In this NPR podcast they look at the recent debate about the dumbing down of scrabble: Settling The Word Score: No Proper Nouns In Scrabble.

The Daily Mash had this piece: Workers ‘Need More Pretend Training with Overpaid Bullshit Merchants’