Biblical Principles for Financial Decision Making in Bankruptcy
Biblical principles for financial decision-making in the context of bankruptcy emphasize responsibility, justice, and the understanding of debt. While the Bible does not explicitly use the term "bankruptcy" as understood in modern legal systems, it provides guidance on managing financial obligations and responding to insolvency.
A foundational principle is personal financial responsibility. The Babylonian Talmud, for instance, discusses scenarios where an individual is held financially responsible for designated items, such as a lamb for the redemption of a firstborn donkey or money for a firstborn son's redemption. Rabbi Eliezer argues that if these items are lost, the owner must provide a replacement, indicating an ongoing obligation [3, 4, 5]. This highlights the expectation that individuals should fulfill their commitments. The apostle Paul also encourages believers to live "honestly" and "have lack of nothing," implying a responsibility to manage finances in a way that avoids dependence on others and maintains a good reputation among non-believers [6]. This includes working to provide for one's own needs and even to have something to share with others [6].
The concept of judgment, both divine and human, is also relevant. The Bible frequently speaks of a future day of judgment where God will administer righteous judgment [1]. While this primarily refers to spiritual accountability, it underscores a broader biblical theme of ultimate justice and accountability for one's actions, including financial ones. In monetary law, courts are expected to issue rulings based on a majority of judges to determine liability or exemption, indicating a structured approach to resolving financial disputes [8]. Charles Hodge notes that decisions made by authorities, including those pertaining to civil law, are to be obeyed if they are within their legitimate bounds and accord with Scripture [2].
The Bible also addresses the nature of debt and forgiveness. Augustine, in his Homilies on the Gospels, interprets "debts" in the Lord's Prayer as sins, but also acknowledges the instruction to remit money claims, citing Jesus' teaching to "If any man will sue thee at the law, and take away thy coat, let him have thy cloak also" [7]. This suggests a willingness to forgo claims, particularly when a debtor is unwilling or unable to pay, rather than pursuing them to the extreme [7]. However, this is distinct from a universal requirement to remit all debts to all debtors [7].
Calvin's Institutes of the Christian Religion emphasizes self-denial in relation to God, which includes shunning avarice and ambition and depending on God for prosperity [10]. This perspective encourages a mindset that prioritizes spiritual well-being over the accumulation of wealth, which can indirectly influence financial decisions and attitudes toward debt. Calvin also notes that "judgments" can refer to adversity, and that the godly respond to afflictions and calamities with hope and patience, unlike hypocrites who murmur against God in adversity [9]. This theological framework suggests that financial difficulties, including insolvency, can be viewed through a lens of divine providence, requiring a faithful response.
The Old Testament, particularly in its legal codes, established provisions for debt relief and the release of slaves due to debt, such as the sabbatical year and the year of Jubilee, which offered periodic resets for financial burdens. While these specific laws are not directly applicable in modern contexts, they reveal a divine concern for preventing perpetual indebtedness and ensuring a measure of economic justice and fresh starts within the community. The principle of giving "skin for skin, and all that a man has" for survival, as Matthew Henry interprets Jacob's willingness to send Benjamin, illustrates the extreme measures people might take in dire circumstances to preserve life and family, even if it means parting with what is most dear [11]. This reflects a pragmatic approach to unavoidable hardship.
Sources
- Torrey's Topical Textbook “Torrey's Topical Textbook: Judgment, The — Predicted in the Old Testament -- 1Ch 16:33; Ps 9:7; 96:13; Ec 3:17. A first principle of the gospel -- Heb 6:2. A day appointed for -- Ac 17:31; Ro 2:16. Time of, unknown to us -- Mr 13:32. Called the Day of wrath. -- Ro 2:5; Re 6:17. Revelation of the righteous judgment of God. -- Ro 2:5. Day of judgment and perdition of ungodly men. -- 2Pe 3:7. Day of destruction. -- Job 21:30. Judgment of the great day. -- Jude 1:6. Shall be administered by Christ -- Joh 5:22,27; Ac 10:42; Ro 14:10; 2Co 5:10. Saints shall sit with Christ in -- 1Co 6:2; Re 20:4. Sh”
- CCEL (Reformed (Old Princeton)) “Charles Hodge, Systematic Theology, Vol. 3, section 47: on his own responsibility. If the decision is within the limits to which God has confined the action of the Church, and in accordance with the Scriptures, it is to be obeyed. If it transcends those limits, or is contrary to the word of God, it is to be disregarded. If therefore the Church through any of its organs should assume to decide questions of pure science, or of political economy, or of civil law, such decisions would amount to nothing. Or, if it should declare that to be true which the Scriptures pronounce to be false; or that to”
- Babylonian Talmud (Jewish (Rabbinic)) “Babylonian Talmud, Bekhorot 122a.24:16: MISHNA: In the case of one who designates a lamb for the redemption of a firstborn donkey and the lamb dies, Rabbi Eliezer says: The owner bears financial responsibility and must give the priest another lamb in its place. This is like the case of the five sela for redemption of a firstborn son, where if the money is lost before one gives it to the priest, he must give the priest another five sela . And the Rabbis say: The owner does not bear financial responsibility. This is like the case of money designated for redemption of second-tithe produce, where ”
- Babylonian Talmud (Jewish (Rabbinic)) “Babylonian Talmud, Bekhorot 122b.24:16: MISHNA: In the case of one who designates a lamb for the redemption of a firstborn donkey and the lamb dies, Rabbi Eliezer says: The owner bears financial responsibility and must give the priest another lamb in its place. This is like the case of the five sela for redemption of a firstborn son, where if the money is lost before one gives it to the priest, he must give the priest another five sela . And the Rabbis say: The owner does not bear financial responsibility. This is like the case of money designated for redemption of second-tithe produce, where ”
- Babylonian Talmud (Jewish (Rabbinic)) “Babylonian Talmud, Bekhorot 12b.16: MISHNA: In the case of one who designates a lamb for the redemption of a firstborn donkey and the lamb dies, Rabbi Eliezer says: The owner bears financial responsibility and must give the priest another lamb in its place. This is like the case of the five sela for redemption of a firstborn son, where if the money is lost before one gives it to the priest, he must give the priest another five sela . And the Rabbis say: The owner does not bear financial responsibility. This is like the case of money designated for redemption of second-tithe produce, where once”
- 1 Thessalonians (Presbyterian) “Jamieson, Fausset & Brown on 1 Thessalonians 4:12: honestly--in the Old English sense, "becomingly," as becomes your Christian profession; not bringing discredit on it in the eyes of the outer world, as if Christianity led to sloth and poverty (Rom 13:13; Pe1 2:12). them . . . without--outside the Christian Church (Mar 4:11). have lack of nothing--not have to beg from others for the supply of your wants (compare Eph 4:28). So far from needing to beg from others, we ought to work and get the means of supplying the need of others. Freedom from pecuniary embarrassment is to be desired by the ”
- Schaff ANF/NPNF (Patristic) “NPNF1 Vol 6: Augustine — Homilies on the Gospels — CHAP. VIII.--28. The fifth petition follows: "And forgive us our debts, as we also forgives our debtors." It is manifest that by debts are meant sins, either from that statement which the Lord Himself (part 1): 43 For we are enjoined to remit a money claim by that precept rather which has been given above, "If any man will sue thee at the law, and take away thy coat, let him have thy cloak also;"[1] nor is it necessary to remit a debt to every money debtor; but only to him who is unwilling to pay, to such an extent that he wishes even to go to”
- Babylonian Talmud (Jewish (Rabbinic)) “Babylonian Talmud, Sanhedrin 32a.3: In cases of monetary law, the court directs, i.e., issues, the ruling based on a majority of one judge, either to exempt, or to find liable. But in cases of capital law, the court directs the judgment based on a majority of one judge to acquit and based on a majority of two judges to find liable.”
- CCEL (Reformed) “Calvin, Commentary on Isaiah, Vol. 2, section 14.16: many hard passages, still there is room for hope and patience. By the way of judgments he means adversity, and the word judgment often has this meaning in Scripture. But here is a mark which distinguishes the godly from hypocrites; for in prosperity hypocrites bless God, and speak highly of him; but in adversity they murmur, and curse God himself, and plainly shew that they had no confidence in him, and thus judge of God according as their prosperity lasts. The godly, on the other hand, when they are tried by afflictions and calamities, are ”
- CCEL (Reformed) “John Calvin, Institutes of the Christian Religion, section 62: refuted. 7. Christian life cannot exist without charity. Remedies for the vices opposed to charity. 1. Mercy. 2. Humility. 3. Modesty. 4. Diligence. 5. Perseverance. 8. Self-denial, in respect of God, should lead to equanimity and tolerance. 1. We are always subject to God. 2. We should shun avarice and ambition. 3. We should expect all prosperity from the blessing of God, and entirely depend on him. 9. We ought not to desire wealth or honours without the divine blessing, nor follow the arts of the wicked. We ought to cast all our ”
- Genesis (Nonconformist/Puritan) “Matthew Henry on Genesis 43:11: Observe here, I. Jacob's persuasibleness. He would be ruled by reason, though they were his inferiors that urged it. He saw the necessity of the case; and, since there was no remedy, he consented to yield to the necessity (Gen 43:11): "If it must be so now, take your brother. If no corn can be had but upon those terms, we may as well expose him to the perils of the journey as suffer ourselves and families, and Benjamin amongst the rest, to perish for want of bread." Skin for skin, and all that a man has, even a Benjamin, the dearest of all, will he give for his ”