He Shall Not Press His Fellow

In 2003, I founded a company that provided cloud services for telephony infrastructure. We had excellent technology, a crack team of coders, and eventually clients that included some of the world’s top carriers. Five years later, we had signed with an investor and were in negotiations for acquisition by a major European telephone company. We just needed a few more payroll cycles to cross the finish line, so I turned to a colleague for a bridge loan. It was such a sure thing that I signed on the loan personally. It was summer 2008.

By autumn, the financial world had collapsed, my investor had backed out, and our negotiations for a buyout had fallen through. When the dust settled, the company was gone, and I was saddled with a huge debt that I knew I would never be able to repay. My creditor was reasonable, even magnanimous. Still, I owed him the money, and he wanted to be repaid. We agreed that I would pay a substantial sum (a tiny fraction of my actual debt) every month—forever. I knew I was getting off easy. So, I went out and got a new job, and every month the very first check I wrote was the one that I knew I would be writing for the rest of my life.

I am reminded of this because this Jewish calendar year, 5782, is a shmita, or “release,” year, which the Torah mandates as a sabbatical for the land. Many farmers in Israel will let their fields lie fallow and leave their fruit trees free for the picking. Others will use work-arounds approved by the Chief Rabbinate that will allow them to farm, but those fruits and vegetables will be considered “sanctified.” Households that observe the laws of shmita will be careful not to waste their produce (peels, pits, even rotten fruit will be disposed of with great care), a reminder that the land is a gift. It’s not only the land that is supposed to reboot every seven years, but also its people, as all financial debts are to be completely canceled: “Every creditor shall forgive debts owed him by his fellow; he shall not press his fellow or kinsman to repay” (Deut. 15:2).

By late antiquity, it was already clear that a complex economy couldn’t work this way.If creditors knew that every seven years, all debts would be forgiven, who would ever lend money? In fact, the Bible itself already anticipated the problem: “Beware lest you harbor the base thought: ‘The seventh year, the year of shmita, is approaching,’ so that you are mean to your needy kinsman and give him nothing” (Deut. 15:9). By the time of Hillel the Elder in the first century, the financial aspect of shmita was apparently close to a dead letter, and people were hesitant to loan money.

Farming the land, Israel ca. 1960. (Neot Mordechai Archive, Pikiwiki Israel.)

Hillel’s solution was a legal fiction called a prosbul, a halakhic instrument through which a lender signs over unpaid debts to a rabbinic court at the end of the shmita year. The court, which is not an individual and hence is not technically a “fellow or kinsman,” collects on the loan and then redirects the funds to the lender.

The prosbul was a famously, perhaps even infamously, bold solution. The great third-century Babylonian scholar Shmuel derided it as “an affront to the judges” and said that one day he would abolish it, but he never did. And so, this coming year, on September 25, 2022, Jews around the world will sign prosbul documents once again. But couldn’t Hillel have made the process a little simpler? Why must each individual compose his or her own personal prosbul document when the entire arrangement could have been implemented wholesale by the courts alone?

I’ve recently been studying the work of Rabbi Yitzchak ha-Levi Herzog, the first chief rabbi of the State of Israel (both the father of Israel’s sixth president and grandfather and namesake of Israel’s current president), whose great project was to fit the demands of halakha to the needs of the modern state. One of the key tools in Rabbi Herzog’s arsenal was the takkana, or legal enactment. Hillel’s prosbul was the quintessential and most audacious example of a takkana, and Rabbi Herzog examined it intensely, prodding and poking it from every angle.

Herzog noted that the court could indeed have annulled the cancelation of debts as part of the shmita-year regulations, but had it done so, “the very core of the mitzva would be impaired.” The core of the commandment, according to Herzog, was the recognition that the Earth is the Lord’s and that property, debts, and class distinctions are all human constructions. “All the earth becomes a single plain in the holy year,“ Herzog writes, “and all the barriers between rich and poor fall away.” Once every seven years, at least ideally, the economic playing field should be leveled, and those trapped in debt should be freed. The prosbul may have been a necessary legal fiction devised to keep an increasingly complex society running smoothly, but Rabbi Herzog realized that Hillel had deliberately structured his takkana so that every lender still must encounter the revolutionary ideal of the Bible when writing his or her own prosbul.

A little less than seven years ago, five years into my lifelong repayment plan, I received an overseas call from my creditor. “As I was signing my prosbul today,” he began, “I realized that I can afford to abide by the intention of the original Torah law. In the spirit of shmita, I am canceling the rest of your debt.” We talked for a little while about how we had come to this place: the original bridge loan, the 2008 financial crisis, my company’s failure. “It could just as easily have been me,” he said.

The seven-day week, seven-year shmita sequence, and seven rounds of seven years that lead up to the Jubilee all highlight the cyclical nature of the world. At any moment, the situation in which one finds oneself—financially, physically, emotionally—may be reversed. In the blink of an eye, we may find ourselves going from the one who can give to the one in need, from a CEO on the verge of great success to a supplicant.

The prosbul was not merely a clever legal workaround. As Rabbi Herzog suggested, it offers us the chance to preserve the intent of Torah law while operating in a modern economy. Nonetheless, as I have learned, forgiving a debt and forgoing the prosbul can give one’s fellow, one’s kinsman, something more—a second chance.


  1. j fine

    So who was this benevolent creditor? And what percentage of the original debt remained? And was the creditor able to take a deduction on his tax return for the bad debt under Section 166? If so, was it taken as a business bad debt giving rise to ordinary losses, or a nonbusiness bad debt giving rise to short-term capital losses? Just wondering.

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