Giving Preference to a Relative, a Neighbor and a Fellow Jew
העדפת הקרוב, השכן ובן העם
When two people ask a person for a loan and he is able to lend to only one of them, he should give precedence to the one closer to him, as it is stated (Shemot 22:24): “If you lend money to My people – to the poor who is with you.” “With you” means the one closer to you. Therefore a relative takes precedence over a neighbor, a neighbor over one who is not a neighbor, one who lives in your town over one who does not live in your town, and a member of your people over a member of another people (Bava Metzia 71a).
Similarly it is stated (Vayikra 25:14): “And if you sell something to your fellow, or buy from the hand of your fellow, you shall not wrong one another.” The Sages said (in the Sifra) that with the word “your fellow” the Torah intended to teach that in every purchase or sale a person should prefer his fellow, that is, the one closer to him, and this includes giving precedence to members of his own people over members of another people. The novelty here is that not only in matters of kindness and charity should one prefer the one who is close, but in all economic areas too a person should prefer those close to him.
This halakha does not express a boycott of one who is not a relative, not a neighbor, or of another people. On the contrary, it is known that all of Israel bears responsibility for the rectification of the entire world, as was said to Avraham Avinu (Bereishit 12:3): “And through you shall all the families of the earth be blessed.” And so it was said to Yaakov Avinu (ibid. 28:14): “And through you and your descendants shall all the families of the earth be blessed.” Rather, this halakha is meant to express the brotherhood and the additional responsibility incumbent upon every person toward his relatives, neighbors and fellow members of his people. It is reasonable that the same law applies to members of all the nations: every person should give precedence, in all interpersonal matters, to his relatives, then to his neighbors, and then to members of his people.
The idea behind this principle is simple and logical: in order to solve all the hardships in the world and build a good and healthy society, one must begin rectifying in order, from the nearer circle to the more distant. Beyond the fact that brotherhood demands this, this principle allows society to rectify itself completely, as responsibility spreads logically in circles; for the closer a person is to his fellow, the better he knows him, and the better he knows how to help him effectively. So it is in matters of charity, and so too in matters of employment: in the long term, relatives, neighbors and members of one’s people know how to employ the worker in the way most beneficial to both.
The mitzva to prefer a member of our people applies even when the price he asks is slightly more expensive. For we learned that even with a loan it is a mitzva to prefer the Jew (Bava Metzia 71a), and it is known that it is permitted to lend to a gentile with interest while to a Jew it is forbidden; if so, when the Torah commands us to give precedence in lending to a member of our people, the intention is even if we lose a certain profit (Ahavat Ḥesed 1:5:7). However, when the difference between them is not small, there is no obligation to prefer him.
The meaning of this is that the mitzva of preference is not intended to disrupt the economic considerations of the person or business; rather, the intention of the mitzva is to create a certain preference for the relative, the neighbor and the fellow Jew, while preserving the profitability and viability of the business.