The Market and the Temple/10 - In the first multinational companies that arose in the Christian cities of the fourteenth century, the poor were the representatives of God and took part in the earnings
By Luigino Bruni
Published in Avvenire 10/01/2021
Nostalgia for an imperfect form of capitalism, imperfect, but still capable of becoming a thing for the deathbed and making accounts payable to Lord God Almighty.
The osmosis between the cloisters and the market was much broader and deeper than is commonly thought. The wealthiest merchants had their children educated in monasteries, starting way back in the eleventh century, so much so that for many centuries the word cleric was also used for clerk and business clerk in many European languages, (in fact clerk still has this meaning in English). It is no coincidence that both monks and the work of the laity were talked about in terms of profession. The merchants were by no means uneducated and illiterate, in their own way, they were an essential part of the same humanist movement as philosophers and writers were – today, as in the past, merchants begin their downfall when they stop being humanists, because they become slaves of whatever sophist happens to be in charge.
We would not have had the extraordinary success of medieval merchants without the cultural role held by the monks: that new class was also able to impose itself thanks to the culture and knowledge that they had learned in the monasteries. From the 12th century and onwards the monks were joined by the new mendicant orders, who, unlike the monks, lived in the heart of the new cities, of which they helped to shape the culture, architecture, and the ethics. We cannot fathom that first form of "capitalism" without the daily contact between commerce and the mendicant charisms, which brought faith under the lodges of the merchants and the merchants inside the cloisters of the convents. Humanism and the Renaissance are the fruits of this often explicit alliance between merchants and the religious. It is within this unlikely alliance that the roots of the extraordinary successes of the Western economy, as well as its ambiguities, lie.
An alliance that was overseen by both theological books as well as accounting books. In those centuries, faith made an entrance into the items usually mentioned in financial statements, instead of being entrusted to social reports. The account in the name of "Lord God Almighty" was an account kept alongside any other. The following statement is found in the "secret books" of the company of the Bards of Florence: «We had 1876 Libra, and 10 florins, in debit to God in July 1310», and then one would refer to the Book of Reason, «where they were also registered» (Armando Sapori, Mercatores). Lord God Almighty's account was found not only in the "secret book", (that is, the book containing the interests on dividends, and the deposits of each individual member of the company), but also in the "Book of reason", which contained the items of "dare et habere" (debit and credit) and the accounts ledgers - hence the terms "accountant" and "accounting". The account dedicated to God was treated like any other ordinary account, and managed exactly like the other accounts of the partners: «We speak of the "shares" of Lord God Almighty as we speak of the "shares" of Lord Ridolfo, of Lord Nestagio, and of the shares of all the partners». In the budget of 1312, «the poor received 661 lire, that is the exact amount that Cino di Boninsegni, who had two shares in the company, received».
The representatives in Lord God Almighty's company were therefore the poor, and «the poor considered themselves to be shareholders in the company, and all the stipulations of the social contract regarding the division of earnings were valid for them as well» (Armando Sapori, Mercatores). Of course, this was a very different world from ours, but reading "debit to God" in the financial statements of those first multinational companies still makes an impact, unable to leave us indifferent. However, while they allocated part of their dividends to Lord God Almighty, those merchants practiced usury extensively. We know that usurers were an essential part of the medieval civil landscape. A new bank was opened on concession from the Municipality, that is, with a public contract between the city and the usurers in question, who must have had the reputation of "public usurers". They were both Christians and Jews, easily recognizable by their benches with the carpets on which they sat under their awning, perfectly visible in the central streets of the city.
In 1417, for example, there were fifteen public usurers in Pistoia. Many artisan tools could be found among the pawns of the Banco dei pegni (pawn shops) of Pistoia, which were managed by a Christian. Piero, a miller, left, a «woman’s gray, old, worn-out underdress»; a tailor from Montepulciano «a bad, broken bag», and Bartholomeo di Filippo da Verona, a pair of «sad, old, black stockings»; and furthermore, saws, clubs, skins, plowshares, (L. Zdekauer, Inside a pawnbroker’s shop in 1417/ L’interno di un banco di pegno nel 1417). The pawns were hence various artisan objects and work tools; and, in the frequent case of gambling losses, (one of the most common reasons for having to borrow money), they ended up damaging the cities. What is striking from these pawn lists, is the origin of the debtors: they were almost exclusively foreigners and people from out of town, a sign that going to a usurer was considered a shameful action, to be done where no one knew you. This context, therefore, provides us with a better understanding of the social urgency of the birth of the Franciscans' Monti di Pietà, which arose in imitation of the existing pawnshops («as has been done for the Monti of the Jews», as was specified in 1471 in Siena, on the occasion of the institution of the Monte di Pietà).
Reading these ancient archives, what is striking is the absence of the families of the great merchant-bankers from the lists of usurers. If, in fact, a merchant also performed the function of banker, this second feneratizia activity, (usurious, from the Latin fenus: interest, usury), was considered auxiliary to the mercantile one, and hence not considered usury at all. That profound distinction, which spans the entire Middle Ages, made between large and smaller merchants, returned. The former, accepted and often praised, often connected to the figure of Mary of Magdala or the Magi, and the latter condemned as parasites, equated with Judas the bursar. In fact, «from the names of the usurers that we encounter in our books it does not appear that any belonged to the merchant and banking families of the Ammannati, Cancellieri, Visconti, Reali, Cremonesi... » (Armando Sapori, Usury in the 13th century in Pistoia/ L’usura nel Dugento a Pistoia). The great merchant-bankers gradually gained their right to a good citizenship in the Middle Ages, where wealth was held in low esteem, thanks above all to their donations and returns. In fact, one can begin to discern something important of that first spirit of capitalism in the wills of these great merchants.
The first provision that is found in those wills is the obligation of restitution, addressed to the heirs, of any usury or loot: «I Iacopo, a citizen of Siena, sane of mind, although infirm in body, order that every usury, every loot be returned to the people»; and then he adds: «The people and places in question are registered in my accounting books, which I now hand over to Friar Ugo di San Galgano». And then he concludes: «Since my liquid assets are certainly not sufficient to return the loot, precisely because the cases of usury and bad acquisitions are so many, I want and impose that my assets be sold» (Armando Sapori, Mercatores).
In addition, the guilds required that at the beginning of each year a commission, made up of merchants and friars, passed from shop to shop to ask, under penalty of expulsion, that the merchants forgive each other for their respective usury, in a sort of pact of mercy, (which, it cannot be ruled out, may have been introduced by the Franciscans). And so it becomes both surprising and moving to read the following in the accounting books: «In August 1319, we, Francesco del Bene and companions, forgave Duccio Giunte and Geri di Monna Mante, mayors of the Arts, and all those of the Arts who had had merit from us; and the aforementioned mayors in turn forgave us» (A. Sapori, Mercatores). It was a form of capitalism where the accounts of Lord God Almighty could be found in the books, forgiveness and mercy were frequently mentioned, and where usury was called "merit" and the Monti di Pietà "sine merit".
In those same years, the Franciscan theologians, (Olivi, for example), were busy working on legitimizing interest loans. However, not all merchants read the Latin treatises written by those masters, and above all, they knew perfectly well when the interest they applied was excessive, when their profits were wrongful, beyond what the law said or prohibited. And they took note and registered those different kind operations, mostly carried out abroad where they could not be observed by their friends or friars, in their souls and registers. And so, at the point of death, when other numbers and scores were being settled within other books of reason, those Christian merchants wanted to leave this earth putting things right, and therefore returned the stolen loot. These donations and restitutions at the moment of death ended up contributing to a large part of the works of art of our cities, hospitals and charity organisations. Common goods born out of this second chance accounting, out of the conscience of merchants who knew that a part of their wealth had to be corrected and converted; because they were convinced, or at least hopeful, that giving away a wrongfully acquired wealth in the end was the only possible alchemy to transform evil into good.
This first meridian "spirit of capitalism" did not consider all wealth a blessing, but only a good kind of wealth, that is, that which had been purified from usury and misappropriation. Hence, death became the first mechanism of redistribution of a wealth that produced private goods in life and public goods post-mortem. This is how the merchants, especially the great and the rich, managed to become accepted by the culture of their time, compensating for the sins of life in death. In that environment, this returned wealth was eventually considered to be much more deserving of the "merit" than what the merchant-usurers demanded on the money they lent. The benefits of those compensations outweighed the moral costs of usury. This is where the ethical rule at the basis of Western society begins to develop: private vices versus public virtues.
Moreover, if we want to get to the bottom of our reasoning, then we must recognize that those donations and returns are at the origin not only of the beauty of Florence and Venice, but also of many of the troubles of modern mercantile reasoning. Those ex-post regrets were not enough for the heirs, who continued to manage the companies, to make them change their business ethics and make less wrongful profits and practice less usury. Instead, they continued the same business ethics as their parents, entrusting the final settling of scores to their wills.
Many paradoxes of our capitalism are found in this game between what appears as ambiguous lives and holy deaths, its amnesties and pardons, the philanthropy of 2% of the profits silencing the questions on the remaining 98%, up to the donations of companies that deal in gambling and arms manufactory. Then, when a few decades ago, the fear of divine judgment definitively left the horizon of our disenchanted capitalism, the new and very rich merchants stopped feeling the moral duty to return the booty or loot to the community. Hence, that enormous wealth and usury generated less and less common goods and more and more private goods, and inequality was further amplified. And the nostalgia of the accounts in the name of Lord God Almighty and of the pacts of forgiveness between merchants keep growing within us, because the faith in paradise of those ancient merchants appears much more human and civil than faith in the tax havens of our modern capitalism.
