Saturday, January 19, 2008

FREAKANOMICS AUTHORS Stephen J. Dubner and Steven D. Levitt invoke the Jewish sabbatical year in their NYT column "Unintended Consequences":
How long have such do-good laws been backfiring? Consider the ancient Jewish laws concerning the sabbatical, or seventh year. As commanded in the Bible, all Jewish-owned lands in Israel were to lie fallow every seventh year, with the needy allowed to gather whatever food continued to grow. Even more significant, all loans were to be forgiven in the sabbatical. The appeal of such unilateral debt relief cannot be overestimated, since the penalties for defaulting on a loan at the time were severe: a creditor could go so far as to take a debtor or his children into bondage.

So for a poor Jewish sandal maker having trouble with his loan payments, the sabbatical law was truly a godsend. If you were a creditor, however, you saw things differently. Why should you lend the sandal maker money if he could just tear up the loan in Year Seven? Creditors duly gamed the system, making loans in the years right after a sabbatical, when they were confident they would be repaid, but then pulling tight the purse strings in Years Five and Six. The resulting credit drought was so damaging to poor people that it fell to the great sage Hillel to fix things.

His solution, known as prosbul, allowed a lender to go to court and pre-emptively declare that a specific loan would not be subject to sabbatical debt relief, transferring the debt to the court itself and thereby empowering it to collect the loan. This left the law technically intact but allowed for lenders to once again make credit available to the poor without taking on unwarranted risk for themselves.

The fallow-land portion of the sabbatical law, meanwhile, was upheld for centuries, but it, too, finally gained a loophole, called heter mechira. This allowed for a Jew to temporarily “sell” his land to a non-Jew and to continue farming it during the sabbatical year and then “buy” it back immediately afterward — a solution that helped the modern state of Israel keep its agricultural economy humming.

The trouble is that many of the most observant Israeli Jews reject this maneuver as a sleight of hand that violates the spirit of the law. Many of these traditionalists are also extremely poor. And so this year, which happens to be a sabbatical year, the poorest Jews in Israel who wish to eat only food grown on non-Jewish land are left to buy imported goods at double or triple the regular price — all in order to uphold a law meant to help feed the poorest Jews in Israel.
This is used in support of a critique of unintended consequences they say arise from the Americans With Disabilities Act and the Endangered Species Act.