Debt

Etymology and Historical Origins

The word debt originates from the French word dette, which in turn is derived from the Latin word debitum. From the perspective of Western history of law, the earliest accounts of debt can be traced to Mesopotamia as early as 1600 BC. According to Niall Ferguson, archaeological excavations in the ancient city of Sippar revealed a clay tablet with inscriptions in cuneiform writing, indicating that the owner of the clay tablet was in possession of a recognizance of debt, in terms of a ratified amount of grain due at the time of the next harvest. However, the earliest surviving piece of wordings of an Act on debt originates from the so-called Twelve Tables, constituting the first code of law by the Romans in 450 BC. The statutes of debt, which were captured by inscriptions on Table III, declare that a debt that is not repaid in due time after the announcement of a court order gives the creditor the right to arrest the debtor. After sixty days in custody, the case is returned to court, and if the debt is not then paid, the debtor can be sold abroad as a slave or simply killed.

Whereas Roman law, at its first stage, exerted extreme penalties for payment default to the debtor (subsequent reformulations of the Roman law improved the situation of debtor, though), the Middle Ages brought about a radically different perspective in Europe. According to the Catholic Church, moneylending and income from interest were considered manifestations of greed and usury, therefore appertaining to the seven deadly sins, and as such were seriously condemned. For example, if a moneylender (i.e., banker), before his own ultimate death, did not refund all the interest he had charged his debtors, he could not expect to be buried in consecrated ground. Interestingly, Islam forbids lending with interest even today.

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