How Should We Manage Our Debts?

David Cowan


Editor's Note: The Following is an excerpt from Economic Parables by David Cowan (Authentic Books)

The Parable (Matthew 18:21-35)

Then Peter came to Jesus and asked, “Lord, how many times shall I forgive my brother when he sins against me? Up to seven times?”

Jesus answered, “I tell you, not seven times, but seventy-seven times.”

“Therefore, the kingdom of heaven is like a king who wanted to settle accounts with his servants. As he began the settlement, a man who owed him ten thousand talents was brought to him. Since he was not able to pay, the master ordered that he and his wife and his children and all that he had be sold to repay the debt.

“The servant fell on his knees before him. ‘Be patient with me,’ he begged, ‘and I will pay back everything.’ The servant’s master took pity on him, canceled the debt and let him go.

“But when that servant went out, he found one of his fellow servants who owed him a hundred denarii. He grabbed him and began to choke him. ‘Pay back what you owe me!’ he demanded.

“His fellow servant fell to his knees and begged him, ‘Be patient with me, and I will pay you back.’

“But he refused. Instead, he went off and had the man thrown into prison until he could pay the debt. When the other servants saw what had happened, they were greatly distressed and went and told their master everything that had happened.

“Then the master called the servant in. ‘You wicked servant,’ he said, ‘I canceled all that debt of yours because you begged me to. Shouldn’t you have had mercy on your fellow servant just as I had on you?’ In anger his master turned him over to the jailers to be tortured, until he should pay back all he owed.

“This is how my heavenly Father will treat each of you unless you forgive your brother from your heart.”

The Reflection

Have you seen that great Lending Tree ad on TV, where a guy is driving around a large yard on his lawn tractor, telling us all the great things he owns? At the end of the ad he asks the viewer, “How can I afford all this?” Then he looks directly into the camera and says cheerfully through gritted teeth, “Because I’m in debt up to my eyeballs. I can barely pay my finance charges. Somebody help me!”

Debt is something that, in varying measures, nearly all of us have. We may have a mortgage, a car loan, credit card balances, or many other kinds of debt. The value of debt is that it can be used to leverage our earnings and investments—by financing big items and freeing up our monthly income for other things while some of the big items accrue in value beyond their original costs. A good example is our house and the improvements we make to it through financing loans, which enables us to use debt to increase our financial security and overall worth. However, debt can also be a liability that contributes to the loss of value in our investments, such as when a crash in the housing market occurs.

In the business world in general and on Wall Street in particular, debt is part of managing money. Governments and corporations issue bonds and stocks on the basis of their reputation. These are essentially debts that governments and companies create by borrowing money on the money markets. They have assets that they leverage by inviting investors to risk that they will not fail. This is why governments are the biggest borrowers because governments are considered too big to fail. Debt is issued to fund new research, projects, and expansion.

British economist John Maynard Keynes suggested that if you owe the bank a dollar you have a problem; but if you owe the bank a million dollars, then the bank has a problem. Brazil’s finance minister a few years back added, “And if you’re Brazil, then you own the bank!” U.S. banks had sunk so much money into Latin American economies that the reality was they were beholden to the finance ministers. They had to work out a deal to solve the debt crisis.

Individuals also borrow money against their assets, usually their home. And when you deposit your paycheck into the bank, you have created a debt, because the bank now owes you what you deposited. Your asset becomes the bank’s liability. Your credit card debts, on the other hand, become the assets of your bank or card issuer. Our financial situation is tied to our reputation for keeping up with these payments because our borrowing power is based on our previous record of repaying loans or bills.

The fragility of debt is a big picture and small picture thing. The big picture is that we may be living in an economic bubble, and history teaches us that all economic bubbles burst. If this happens, many of us will be in deep trouble. The small picture is that people also experience their own personal bubble. The bubble bursts when they lose their job, get a divorce, and so on. Meanwhile everyone is carrying on business as usual. Debt, essentially, is a relational issue. If you run into trouble, your best recourse is to talk to your creditors. They can help you plan a way out of the problem.

If we ignore our debt we can get drawn into its centrifugal force, swallowed up by higher interest payments. We can get manipulated by loan sharks, becoming hopelessly mired in debt and in need of rescue. The problem is not interest per se, but the abuse of the charges. If you act responsibly, you can manage your debt. If you get drawn in too deep, however, then you will be open to abuse.

The question of interest was no different when Jesus told this parable. He used an example of someone in a lot of debt—definitely up to his eyeballs! The sum Jesus uses is vast on purpose. Ten thousand talents, millions of dollars, was clearly too much for the servant to repay the king. He has little to fall back on, and even selling himself and his wife and children into slavery will not fix the problem. All the man can do is beg to be released from the debt, which the king does with compassion. What does the forgiven servant do in response? Unrepentant for his own indebtedness, he demands one hundred denarii owed by a fellow servant. This is such a trivial amount compared to his own debt, yet he has the other servant thrown into jail until he could repay the debt. Such ingratitude!

We learn the real value of forgiveness in this parable. We can look around us and see all the wonderful things we have. We can wonder at the world created to sustain us. We can stand in awe at the marvelous things God has given us. We can turn to ourselves and see how little we have to give in return. Yet God does not demand much from us, only that we give ourselves to him in faith. This is the set of spiritual accounts God keeps with us, and we are up to our eyeballs in debt!

Why does Jesus tell us this story to explain forgiveness? Because, as 1 Timothy 6:10 says, “The love of money [the love of money, not money itself—as some folks misquote Paul] is a root of all kinds of evil.” If we love money or possessions too much, then we will never be generous with them. We will try to hold on to our money and possessions more than we hold on to Christ. Jesus knows this. He knows what hold our money and possessions have on us.

If we have enough money and possessions, then we are more able to be generous. We see how wealthy people can be generous by running charity events and setting up foundations. It is good they do this work. However—and with Jesus there is always a however—such generosity will not buy the wealthy a place at the Lord’s table. Only faith can do that. Faith will also make us generous, no matter how little we may have. Remember the widow’s mite? How little she had, yet how generous she was with so little.

Generosity is relative—like a man with a hole in his shoe is better off than a man with no shoes. We read in Romans 13:8: “Let no debt remain outstanding, except the continuing debt to love one another.” We need to look beyond our problems and our self-absorbed view of our situation and in love look to others and how they live. We can easily fool ourselves into being less than generous. We can pretend that someone wealthier, with less money hassles, will help the poor. We can also think that all the solutions will come from someone else because we are too wrapped up in our own problems.

What we ought to be doing is looking at how we might help others with their debt. This can be done by helping those in our own family with their problems, offering to help a neighbor, or volunteering through our church or a community group to offer debt counseling. More than having money given to them, many people just need help to find a solution before they fall deeper into debt. In some cases, being generous with our time can be far more valuable than being generous with our money.

How do our concerns look when compared to the generosity of God’s grace? When we forget to pray? When we forget to give thanks or acknowledge that we owe all to God? When we turn away from the generosity he shows us? When we do not share this knowledge of him? When we do not use our gifts and experience to serve him in the world? At times like these, we are like the servant who demands his one hundred denarii. Our demands cost the King dearly. The price of God’s grace was the life of his Son, Jesus Christ. How cheaply we turn from him when we deny that we owe all to him.

The Bible opens with the account of God as creator of all that is in the world. We read of our broken relationship with him. When we give him praise, then we acknowledge that he is the creator God. When we give him thanks, we acknowledge that he is the one who has been generous to us. When we submit ourselves to him, we acknowledge our debt to him. When we act as if we did it all ourselves and deny others a share of his generosity, then we turn away from him in sin.

The opposite of generosity is greed. Theologians who criticize the free enterprise system often assume that greed is what makes capitalism work. They argue that greed is part of the “sinful structure” of the free market. This suggests that all people in the free market economy act greedily, except presumably those who advocate such a view! Their argument avoids the fact that greed is about people, not structures. People can be greedy for things economic or noneconomic. While there are many greedy people, the majority are just trying to get by.

What the great classical economic writers put at the center of the free market system is not greed but self-interest. This is where there is confusion. Doing the self-interested thing is not the same as doing the selfish thing. A few years back I met a guy on a train who had gambled away his house, marriage, and family. He was pretty much broke. Do you know where he was going? Back to the racetrack! We can spend our money on gambling, a selfish indulgence. It is not in our self-interest economically; like this fellow, we could lose everything.

The ambition of the gambler is to buy security and happiness in one giant leap. The ambition of the Christian is to receive God’s grace, which cannot be bought cheaply. God’s grace has already been bought for us on the cross. In Christ alone we find our ambition. Eric Liddell, the Scottish runner turned missionary, said that when he ran he felt God’s pleasure. When we are succeeding, achieving things, we too can feel God’s pleasure. When we live in Christ—knowing that we are up to our eyeballs in debt—when we acknowledge that what we do is for God, when we turn to help others out of their debt, then we will feel God’s pleasure.

Other Biblical Texts to Study

Matthew 18:21; Matthew 18:15; Luke 17:3–4; Matthew 18:22; Genesis 4:24; Matthew 18:27; Luke 7:40–43; Matthew 18:28–30; Deuteronomy 15:1–11; Matthew 18:33; Matthew 6:12; Romans 13:8; Colossians 3:12–13; Ephesians 4:32; Matthew 18:35; Matthew 6:14–15

Things to Think About

• How do you manage your debts? Do you set rules or limits for borrowing and lending?

• Is a debt always a bad thing? Can it be a tool if we use it wisely?

• What do you make of Paul’s words in Romans 13:8: “Let no debt remain outstanding, except the continuing debt to love one another”? How strictly and literally should we take this verse?

• Can you recall an occasion when you were generous? Can you recall an occasion when you were unforgiving? How did you feel on each occasion?

• Why do you think people get into debt? Should others help them? How can they help themselves?

• What do you think about all the advertising that encourages us to take advantage of using credit? Does it make us aware of legitimate opportunities or try to manipulate us?

• Do you think people in deep debt are best served by having their debts canceled? What message does this send to people about falling into debt?

• Can Jesus’ words in this parable and elsewhere be extended to “forgiving the debts” of poor countries? You might want to study this question in conjunction with chapter 9 on the parable of the two debtors (Luke 7:40–50).

• Do you think greed is what makes the free enterprise system work? If so, what do you think can be done to change the way the economy works?

• Do you agree that greed needs to be distinguished from self-interest? How can you apply this to your own life?

Article excerpted from Economic Parables by David Cowan used with permission of Authentic, 2007.

David Cowan is a pastor, speaker, writer, and theologian. He holds a Bachelor of Theology and Master of Theology, both from the University of Oxford, and a Diploma in Ministry from Westfield House, Cambridge. For over twenty years, he worked as a journalist, editor, and bank executive in Europe and North America for organizations such as Financial Times, Euromoney, and the World Bank Group in Washington DC. He has written for the Washington Times, Financial Times, The Times of London, The Middle East and has been interviewed by major print, television, and radio media, including CNBC, Bloomberg TV, Wall Street Journal, Financial Times, and BBC Radio. He lives in Cluny, France with his wife and two children.