Lever vs. Leverage

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A lever is a simple tool, a bar of iron or a sturdy length of wood that may be used to move or dislodge something heavy. Leverage is the mechanical advantage gained by a person using a lever. According to Archimedes, the power of a lever is formidable:

“Give me a place to stand and with a lever I will move the whole world.” –Archimedes

A simple verb that means “to use a lever” is lever:

Dig out a hollow which is larger than the base of the keystone and roll this rock into place. Use the crowbar to lever it into its final position.

Each wedge in the row is pounded until a thin crack forms between the wedges and the rock can be levered apart.

The noun from lever is leverage: the mechanical advantage gained by the use of a lever.

A figurative meaning of leverage is “an advantage for accomplishing a purpose.”

Price-conscious renters have no leverage [with landlords].

The West has far more economic leverage over Russia at this moment than it does military possibilities.

The only negotiating leverage that most players had was to hold out at contract time, refusing to play unless their conditions were met.

The OED’s first documentation of leverage as a verb is dated 1937: “Acey leveraged the arm upward.” By 1957, the form leveraged was in use to refer to buyouts and holding companies.

In terms of finance, leverage means “to speculate financially on borrowed capital expecting profits to be greater than the interest that must be paid on the borrowed money.”

A “leveraged buyout” is the buyout of a company by its management with the help of outside capital.”

The word leverage appears in so many contexts now, both as noun and verb, that sometimes a reader must think carefully in order to know if it’s a noun meaning advantage or borrowing, or a verb meaning to lever, to supplement, to provide, or something else. Here are some examples:

Hillshire Brands expects to focus on continuing to invest in its business, reducing leverage over time and pursuing opportunistic acquisitions.

Alex Okosi [is] a key figure in the creation and production of world class African TV content for Africa. With this, he has built a successful platform for brands to leverage on.

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Sometimes the prepositions that follow the verb leverage are redundant or just don’t make sense:

One should leverage off of the previous work in completing this project.”
President Margee Ensign…will lead faculty members…to deliberate on how to leverage on Nigeria’s huge human and natural endowments to win the national war against poverty and illiteracy.

Bond Investors Looking For Bigger Returns Are Increasingly Relying To Leverage

Writers might want to consider relinquishing leverage to the corporate wheeler-dealers for their exclusive use to refer to borrowing and buyouts. Plain old lever still has its uses as a verb. As for leverage as a noun, advantage can replace it in most figurative contexts.

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7 thoughts on “Lever vs. Leverage”

  1. “Leverage” has been so misused and misshapen as to have lost its utility. It is now simply another meaningless business term. It’s even worse than “paradigm.”

  2. I thought that this article might say something about pronunciation:
    At least in America, “lever” is said lev/er, with the slash to divide it into two syllables, and both of the “e”s being short.

    Now in American English: “leverage” = lev/ER/age, with short “e”s and the stress on the second syllable.
    British English: LEE/ver/age, with a long “e” in the first syllable, and with stress on this syllable.
    It could be that this change is in certain dialects of British English. Also, some of the same people might say LEE/ver for the tool.

    Another way of expressing it is that the British way of pronouncing it is as if the words are “leeeverage” and “leeever”.
    I know from personal experience that the two pronunciations make it difficult for American children who watch a lot of British TV programs and movies. Of course, I liked to watch movies and programs about Robin Hood, etc.

  3. The lever/never vs lever/cleaver situation is a pronunciation irritant. AFAIK, the short E rhymes never is the accepted pronunciation in SAE. All the common main sources either list lever as US and “leever” as UK, or American sources don’t list “leever” at all, without even commenting on it. The only exceptions are re Canadian– one lists the long E as “UK and Canada”, while another lists the short E as “North American” as opposed to “British”; and, big surprise, MW which in its typically feckless fashion lists both without comment. Their principle of navigating English seems to be “when you get to a fork in the road, take it.”

    I don’t think that meshes with a British pronunciation equaling 3 Es. I believe the rule is that a triple E must be followed by a Y-O-W-! combination, as in eee yow! Maybe eee-yuck! if used informally.

  4. @Danny: It is now simply another meaningless business term.

    I agree and I wish “business/finance people”, whatever they are, would stop pirating, misusing and ruining perfectly good words for everyone else. *Impression* and *rationalization* pop to mind.

  5. Another way of expressing it is that the British way of pronouncing it is as if the words are “leeeverage” and “leeever”.

    Note the phrase “as if the” and the fact that “leeeverage” and “leeever” were written for emphasis and exaggeration.
    I could have written “leeeeverage” if I had wanted to, for the same reasons.

  6. Leverage used in the financial lexicon provides a very useful image to express what was explained above: “to speculate financially on borrowed capital expecting profits to be greater than the interest that must be paid on the borrowed money.”

    With a small risk to resources, the reward exponentially can be greater. Here is another case of the jargon from one field applied to another unrelated one to convey a concept or image.

  7. I agree with Roberta B. that “leverage” is a useful term for some kinds of financial transactions and maneuvers. I don’t have any objection to that use.

    I also see that there are lots of other pieces of business jargon that are unreasonable and illogical. They should be done away with and replaced with Plain English.

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