Shmitta and the Stock Market
It may seem either a bit belated or very premature to be writing about shmitta six and a half years before the next Sabbatical year. Not at all. "The Shmitta year aways seems to take us by surprise", as Rabbi Yoel Bin Nun humorously but perceptively said at the start of the last one. We need to start thinking and planning now if the Shmitta of 2014-15 is to be a time of ecological, economic and spiritual renewal for the Jewish people, rather than an unseemly political squabble. Tu Bishvat, which marks the new year for trees, seems like the ideal time to plant the seeds of this discussion.
Hazon has set up a website as a focus of public discussion for the next shmitta.
www.shmitaproject.org. Prompted by the stockmarket crash, imminent global recession, as well as having to prepare a couple of talks about shmitta for a speaking tour in California, here are some thoughts that hopefully take that discussion a little further.
The causes of the economic crash are at the same time incredibly complicated and extremely simple. The simple version is that the US mortgage and housing market broke free of some fundamental principles about how you buy houses. Once upon a time, to purchase a house, you had to work hard, save a big chunk of money, and maybe supplement your savings with a mortgage that you arranged with a banker who knew you personally, and with whom you took responsibility for the repayment of your loan.
No longer. Over the last ten years, banks have advanced 100% mortgages to people they never met, with little regard to their ability to repay. The mortgage assets were then parceled up and sold to other banks and investment houses increasingly removed from the original house buyers. All this was done out of a perfect faith in the endless upward trend of the housing markets. When house prices ceased to defy gravity, thousands of home owners defaulted on mortgage payments, mortgage-based assets became almost worthless, and large, distinguished banks who held a lot of those assets collapsed, nearly bringing down the world financial system with them.
It's an old story. Charles Mackay wrote a classic history of financial crises called “Extraordinary Popular Delusions and the Madness of Crowds,” first published in London in 1841. “Men," he wrote, "go mad in herds, while they only recover their senses slowly, and one by one.”
Financial bubbles, like the one in the housing market happen when people's hopes, expectations and delusions about the value of their assets lose all contact with underlying economic reality. The more sophisticated our economic system, the more we can engineer assets can have less and less to do with real things, making speculative bubbles more and more extreme Markets periodically and harshly correct these mass fits of wishful thinking, at the cost of great economic suffering. Often those who suffer most have done least to cause the problem.
Some of the less well known teachings of Shmitta are exactly about managing and moderating this tendency for economic activity to cut its roots in the earth from which it grows. Once every seven years we are meant to return to an intimate connection with the source of all wealth. A few examples:
1. You can't trade on food grown in the Shmitta year. You can eat it, give it away or leave it for the poor, but you may not turn it into a commodity. (Rambam Laws of Shmitta, 6:1) This is based on a derasha of Vayikra 25:6: "it shall be a Sabbatical year to eat." "To eat and not a trade on it." (Talmud, Sukkah 40a). In the Shmitta year food is not an object for financial speculation or persoanl enrichment. It returns to being a gift of God and of the earth.
2. Food from the Shmitta year should be treated as food - Not as compress for a wound or as air freshener, or biofuels, or anything else that food products can be turned into. This is based on the same verse from Vayikra 25: 6 "to eat." Once in seven years we get back to an awareness of food as food, not as a commodity or raw material for some other manufacturing process. To do this once every seven years would be a powerful corrective to the processes of industrial agriculture, which stock our supermarkets with products so removed from natural produce that our great-grandparents would have trouble recognizing them as food at all.
3. In the Shmitta year we return to a relationship with food that is seasonal. If you gather and store fruit from the shmitta year in your house, once that fruit has disappeared from the fields and trees, you can no longer eat what is stored in your house out of season. (Laws of Shmitta, 7:1) The Shmitta year returns us to the agricultural rhythms of nature. Whatever human ingenuity can accomplish by way of distancing us from these rhythms (whether laying up dates in your barn or flying in asparagus from Chile), in the Shmitta we re-embed itself in those natural cycles.
4. In the Shmitta we return to a relationship with food that is local. The seasonal requirement that we just saw is based on regional divisions of the Land of Israel. If the pomegranate season is over in your area, then you can't eat them, even if they are still growing somewhere else in the country. (Laws of Shmitta, 7:9)
And so on. These laws are all about bringing us back to an immediate relationship with the food we eat, as food and connected to a particular time and place. Food is the most basic economic index. The Shmitta is about ceasing to distort, quantify or objectify our connection to the source of sustenance. How do we use this value of returning to an immediate connection with economic fundamentals as a corrective to boom-bust economics? Can we translate these teachings into a post-industrial context in which fewer than 2% of us work on that land? Let the discussion continue! We have five and a half years to get it right for the shmitta year. And our world needs a way to actualize these values far sooner.
Happy Tu Bishvat,
Rabbi Yedidya (Julian) SinclairHazon Rabbinical Scholar
