On October 30, 1682, Pope Innocent XI issued an edict ordering the closing of all Jewish-owned banks in Rome. Although implementation of the edict was twice postponed, it was eventually enforced, and had a terrible impact on the welfare of the Jews of Rome.
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It was in 1555, under the papacy of Paul VI, that Rome’s Jews were confined within the walls of a ghetto and subjected to a number of other restrictions that limited their contact with the general population and their ability to generate income. These restrictions, however, did not extend to banking or pawnbroking, the latter of which was money-lending by another name.
In general, Innocent XI (Benedetto Odescalchi, pope 1676-1689) was not especially hostile to the Jews of the papal states. He did his best, for example, to end the practice of forced baptisms in the areas under his control.
Known for his personal modesty, if not asceticism, he personally opposed the charging of interest on monetary loans, according to historian Leon Poliakov – although he came from a family of bankers and had himself been trained in the field before entering the clerical world.
Jews and Christians had different understandings of the biblical prohibition, in Deuteronomy 28, on usury. One result was that in medieval and Renaissance Europe, Jews were often the only ones legally permitted to loan money. However much resentment they attracted for that, it was mutually beneficial to both Jew and non-Jew to have them fill that role.
Molehills of charity
Starting in the mid-15th century, however, in Italy the Church itself began to allow Christians to become involved in banking, through institutions called the monti di pieta (literally “mountains of piety”), which offered loans to the poor, generally charging low rates of interest. Because of the charitable nature of the monti, most of the Catholic leadership countenanced their existence.
Initially, the monti di pieta and Jewish moneylenders cooperated, but pressure on the pope to force the Jews out of the field, so the Christian-owned organizations could thrive, began to grow.
In the period before the official prohibition of Jewish banks went into effect, there was a lively debate among Catholic clergy over the question. Poliakov, in his book “Jewish Bankers and the Holy See,” quotes from an anonymous commentator of the time, who poses the argument for allowing Jews to continue as lenders before proceeding to respond to and reject that argument.
“Rome is a city of foreigners” was the claim supposedly made by those in favor of leaving things as they were, “with crowds of lay and ecclesiastical personages of every rank and every condition who are ashamed to go to the Monte di Pieta. therefore the usury of the ghetto is necessary. Reply: The Monte di Pieta contains securities deposited by cardinals, counts, marquises and princes; therefore the foreign personages’ alleged embarrassment is merely a veneer to prettify the authorization of Jewish usury and to make it seem licit when it is illicit.”
That was the view that eventually prevailed upon Pope Innocent to issue his edict.
The removal of Jews from the field more than doubled the collective turnover of Roman Monti di Pieta from 480,000 scudi in 1639 (about $2,020 in today’s terms), to 1,030,000 scudi by 1683, a year after the prohibition went into effect.
For the Jews, on the other hand, it eventually drove the community, in 1755, into bankruptcy. According to historian Cecil Roth, the wealth of Rome’s Jews declined by four-fifths within a period of several years.