Oxford University Press's
Academic Insights for the Thinking World

William Godwin on debt

William Godwin (1756-1836) did not philosophically address the question of debt obligations, although he often had many. Perhaps this helps to explain the omission. It’s overwhelmingly likely that Godwin would deny that there is such a thing as the obligation to repay debts, and his creditors wouldn’t have liked to hear that.

A debt is a type of promise, and Godwin denies that promises generate obligations. It is not that we should never do as we have promised, of course. Rather, we should always perform what we think to be the right – the most just – action, regardless of whether it is or is not what we have promised to do:

“I ought to be guided by the intrinsic merit of the objects, and not by any external and foreign consideration. No engagements [i.e., promises] of mine can change their intrinsic claims.” (Political Justice, Book 3, Chapter 3).

Later Godwin comes to the question: ‘if promises be not made, or when made be not fulfilled, how can the affairs of the world be carried on?’ He may have in mind Hume’s essay on the obligation of promises in the Treatise of Human Nature.

Hume does not believe that promises naturally give rise to obligations; there needs to be a social convention in place. But without the convention in place ‘the affairs of the world’ are not carried on, at least not in anything like their recognisable form:

“Your corn is ripe to-day; mine will be so tomorrow. It is profitable for us both, that I should labour with you to-day, and that you should aid me to-morrow.” (Treatise of Human Nature, 3.2.5).

good debt
Image Credit: ‘Good Debt’, Photo by GotCredit. CC-BY-2.0 via Flickr.

What we typically do in this type of situation is promise. I help you with your harvest today and you promise to help me in return. This is not just a promise; it is a debt. I provide you with a service or good, in exchange for your promise to provide me with the same later. Without this system in place, there we’d be, gaping stupidly in our half-harvested fields. So isn’t a good thing at least for us to think that promises generate obligations, particularly the sort that involve debts?

Not for Godwin, who insists that without promises the affairs of the world would be carried on by ‘rational and intelligent beings acting as if they were rational and intelligent’. He asks: ‘Why should it be supposed that the affairs of the world would not go on sufficiently well, though my neighbour could no farther depend upon my assistance than it appeared rational to grant it?’

This isn’t easy to make sense of until we understand what Godwin means by ‘rational’. ‘To a rational being there can be but one rule of conduct, justice’ (2.6). And: ‘If justice have any meaning, it is just that I should contribute everything in my power to the benefit of the whole’ (2.2). Now we can see why, subject to rationality, I should, in Hume’s example, help you today, and you should also help me tomorrow. Each act contributes to the benefit of the whole; Hume himself says ‘ ‘tis profitable for us both’ that each helps the other. Debts and promises have nothing to do with it.

There is one hint in Godwin’s writing that he is thinking about debt specifically, and not just about promising. It is this example:

“I have promised to bestow a sum of money upon some good and respectable purpose. In the interval between the promise and my fulfilling it, a greater and nobler purpose offers itself, and calls with an imperious voice for my cooperation.”

Bad Debt
Image Credit: ‘Bad Debt’, Photo by GotCredit. CC-BY-2.0 via Flickr.

There is no explicit mention of debt, but clearly the most common instance in which one promises money is when one promises it to the creditor from whom one borrowed it. It seems to follow quite directly from Godwin’s reasoning that one should only repay a creditor when, after the promise is made, no nobler purpose comes into view for which the money might be used. In fact one’s obligation is never that of a debtor; it is always that of somebody who possesses money and is bound, however the money was acquired, to make the noblest possible use of it. Likewise in Hume’s example: if you have promised to help me today, but now learn of a neighbour who needs your help more, then there is no question what the just action is.

Of course if you don’t repay your creditors you probably won’t get credit in the future. This reduces your financial power to perform just acts in the future. Would Godwin accept this as justifying the view that people are obliged to pay their debts? Certainly not. The principle that promises ought to be kept is, for him, an inherently unjust idea – ‘a principle founded in prejudice and mistake’. It is wrong to think that anything other than considerations of the benefit of the whole, including prior debt commitments, should govern our actions. Honouring a promise can mean doing what isn’t of most benefit to the whole. You owe money, goods, and services to the people who need them most, not to the people you have promised them to. It would be better, Godwin suggests, if we didn’t promise at all. We should depend on each other’s assistance no farther than it appears rational to grant it.

If this is so, why do we so often take the opposite view proposed to Socrates by Cephalus in the Republic: the view that debts ought, as a matter of justice, to be repaid? Perhaps that view is a pragmatically useful moral illusion for we who are not perfectly rational, tolerable for everyday dealings because it often gets the right result, but dangerously distortionary if treated as anything more than a rough heuristic.

It is, however, a disturbing feature of the way we do things that the people who are in most need of justice are almost always extended credit instead.

This article originally appeared on Origin of Specious, July 2015.

Featured Image Credit: ‘Wheat, Ripe, Harvest, Summer’, Photo by suju, CC0 Public Domain, via Pixabay.

Recent Comments

There are currently no comments.