The Institutional Foundations of Antisemitism

Antisemitism has returned to mainstream politics in Europe and America. One fundamental misconception about antisemitism is that it is simply another form of racism. Thus Jeremy Corbyn responds to charges of antisemitism with “ ‘I’ve spent my whole life exposing racism in any form”. But of course, Corbyn is, at the very least, an enabler of antisemitism (and there is evidence he holds antisemitic prejudices himself — see here).

Why is antisemitism different from other forms of racism? And what makes antisemitism unique. When Noel Johnson and I began writing Persecution & Toleration, we didn’t envision antisemitism returning to prominence, but I believe our analysis sheds important insight on the institutional foundations of antisemitism.

First, definitions. As Deborah Lipstadt explains in her marvelous new book, antisemitism is a conspiracy theory. Its essence is that the Jews are somehow different from others; in its most extreme manifestations, Jews are the source of evil in the world.

But how did this conspiracy theory emerge? David Nirenberg in his book Anti-Judaism: The Western Tradition, describes the transition from prejudice against a small group of stubborn monotheists in Judea to medieval and modern antisemitism. Many elements of antisemitism are the unfortunate byproducts of early Christian writers distinguishing themselves from their parent religion. Particularly damaging was the charge that the Jews were responsible for the death of Christ. But it took until the High Middle Ages for many key elements of antisemitism to develop. What is not fully appreciated in many journalist accounts of modern antisemitism is the extent to which antisemitism was baked into the political economy of medieval and early modern European societies. Hence antisemitism has institutional as well as cultural and religious foundations. Understanding this will shed light on why antisemitism is so prevalent on the political left, and not just the Neo-Nazi right.

Since medieval times, antipathy to Jews has been linked with anti-market sentiments. Anti-market sentiments run deep. Jean-Paul Carvalho and I wrote an essay that explored the conflict between our evolved instincts (which support cooperation in a small-scale group) and the market order that built on the insights of F.A. Hayek. We observed that:

“relations amongst members of a large and dispersed and anonymous society characterized by a complex division of labor are qualitatively different from the kinds of relationships that comprise a small-scale society. This is necessarily true, as Hayek realized, because of the divided and dispersed nature of knowledge occasioned by the division of labor. The information required to achieve coordination between agents is never “‘given” to a single mind which could work out the implications, and can never be so given’ (Hayek 1945, 519).”

Hayek noted that the market order is complex and intangible “based on purely abstract relations which we can only mentally reconstruct’’ (Hayek 1973, 38). This is a marvel:

“We do not see or know all of those who benefit from the exchanges we make; nor do we see how or understand how all the goods we consume are produced; the visible link between inputs and outputs is obscured”.

However, Hayek’s insight into the workings of the price system also explains antipathy towards markets, merchants, traders, moneylenders, and bankers. The benefits of the market order are not legible and this,

. . . is precisely what is alienating and discomforting; markets seem chaotic, unordered, inequitable, even random. Their arbitrary nature offends and demands management or correction. Market-based societies are open-ended, vast yet disparate networks utterly unlike anything our Pleistocene ancestors would have known. Hayek located the atavistic longing Rousseau, Marx, Marcuse articulated in precisely this incongruity. It is often impossible to keep track of all the different agents involved in even a simple market transaction, to count who is benefiting and who is losing out. All we see is the overall pattern, how the system seems to reward winners and losers”.

Middlemen and merchants become natural targets of resentment. After all: What do they make or produce?

Antisemitism became the insidious conspiracy theory that it is now because, over centuries, Jews became seen as the quintessential middleman, trader, merchant, and banker. It is this that animates modern antisemite slurs about “the Rothschilds” or “Jewish banksters” (see this).

Not only are Jews resented as merchants, traders, financiers, and bankers. But in their role as traders and bankers, they are not just any old traders or bankers; they are seen as puppet masters who secretly control the world. The antisemitism of Karl Marx epitomizes this:

“Thus we find every tyrant backed by a Jew, as is every pope by a Jesuit. In truth, the cravings of oppressors would be hopeless, and the practicability of war out of the question, if there were not an army of Jesuits to smother thought and a handful of Jews to ransack pockets.

… Thus do these loans, which are a curse to the people, a ruin to the holders, and a danger to the governments, become a blessing to the houses of the children of Judah. This Jew organization of loan-mongers is as dangerous to the people as the aristocratic organization of landowners… The fortunes amassed by these loan-mongers are immense, but the wrongs and sufferings thus entailed on the people and the encouragement thus afforded to their oppressors still remain to be told”.


But how did Jews become the epitome of faceless capitalism? In ancient times Jews were mostly illiterate farmers. They attracted the ire of the Romans because of their stubborn monotheism and not because they were suspected of pulling the strings of the Roman senate. To understand how the stereotype of the Jew as merchant and moneylender has been firmly entrenched in European cultural memory, we need to understand the political economy of medieval Europe.

Why were Jewish merchants and moneylenders? The first part of the answer to this question is from Marcestella Botticini and Zvi Eckstein. In the Chosen Few, they document how the destruction of the Temple in AD 70 made rabbinical Judaism, with its emphasis on reading the Torah, the only viable form of Judaism. As a result of this religious injunction, Jewish fathers who could not educate their sons were stigmatized. Over time, therefore Jews who remained farmers shed this onerous requirement by falling away from the religion. Those for whom literacy conferred economic advantages, traders, doctors, scribes, remained in the religion. By the Middle Ages, Judaism had become a religion of literate and educated merchants, doctors, craftsmen, and scholars.

The second part of the answer requires understanding how Jews became associated with moneylending. As Noel Johnson and I outline in Persecution & Toleration, the prohibition on lending money at interest among Christians was crucial.

In the Middle Ages, all interest was viewed as usury (see my paper). Restrictions on interest may have made sense in a world where there were few opportunities for prohibitable investment (see this paper by Jared Rubin). But as the medieval economy took off after 1000 CE, new investment opportunities appear. The restrictions became increasingly burdensome.

The usury ban created economic rents. It restricted the supply of credit without dampening demand. One way rulers could appropriate these rents was by licensing Jewish moneylending and taxing it, while simultaneously suppressing Christian lenders. As Noel and I write:

“The commercial revolution, and the new urban economy it called into being, undermined the manorial economy and the conditions that made feudal monarchy a self-supporting political and economic equilibrium. Feudal rulers lacked the capacity to regularly tax their populations. Exploiting Jewish moneylending provided access to an alternative source of revenue: the growing economy . . .

. . . In this way, the state could support itself without investing a great deal in either fiscal or legal capacity. Taxes could be raised without the need for investment in monitoring or enforcement, as the Jews were relatively easy to extort. The simple threat to cease protecting the Jews from the antisemitic society that surrounded them was ample leverage to extort tax revenues from them. It was, in effect, easier to tax vulnerable Jews than to impose more uniform taxes.

As a result, the stereotype of the Jewish usurer became part of Europe’s political economy and cultural memory. Tragically we are still far from free from it. Over time antisemitic tropes became reinforced and embellished; the Jews became enmeshed in a system of indirect taxation and rent-extraction. Antisemitic slurs provided handy justifications for theft, robbery, and violence. They legitimized violence against Jewish communities. Not by coincidence, many of the worst antisemite tropes —the blood libel, notions of a Jewish conspiracy, accusations that Jews spread disease by poisoning wells — date to this period.

How these noxious antisemitic beliefs played in out in terms of expulsions, persecutions, and massacres — as accompanied the Black Death — will be discussed in a subsequent post.

2 thoughts on “The Institutional Foundations of Antisemitism

  1. I think a point missed in the discussion of the roots of ant-antisemitism is an indirect result of the Diaspora. During the Middle Ages, in a time when the average person lived and died within a twenty mile radius of where they were born- you would have people in your community that shared views, experiences etc. with strangers from afar, and could even communicate with people from other countries (this commonality certainly played a role in the growth of the Jewish community in Trade and Finance). It is a simple, ignorant leap to create an “evil among us” that could be then linked to some grand “conspiracy” that crosses borders and exerts a “controlling influence” of some sort.

  2. On the one hand excellent historical perspective. BUT do believe two-sides to every story and always some truth to the worst exaggerations. And this is my criticism of your therefore “unbalanced” description. Yes Jewish moneylenders were at mercy of Landowners BUT!!! it cut both ways and likely both hands greased each other. Noting Jews are always a small fraction of the population have as a tight knit group have had an outsize influence. This for instance evidenced in New York as in pre-WWII Berlin. Net cumulative effects to the unwashed white masses of great influence easier to see. All in all feel you were at best lightly treading over more complex realities and so ended up with just another apolegetic piece. In the regard do no real service to the debate. See the same with debates about Israell where any fair criticisms condemned out of hand as anti-Semetic.

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