Inflation and the Fall of the Roman Empire

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machinehead's picture
machinehead
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Inflation and the Fall of the Roman Empire

A transcript of a brilliant speech by Prof. Joseph Peden has been posted today at LewRockwell. A few excerpts:

The real crisis came after Caracalla, between 258 and 275. In a period of intense civil war and foreign invasions, the emperors simply abandoned, for all practical purposes, a silver coinage. By 268 there was only five tenths percent silver in the denarius. And prices in this period rose in most parts of the empire by nearly a thousand percent. The only people who were getting paid in gold were the barbarian troops hired by the emperors. The barbarians were so barbarous that they would only accept gold in payment for their services.

In the 3rd century this was a constant problem in Rome: all sorts of people were trying to escape the increased taxes that the military needed. The army itself [had grown] from the time of Augustus, when they had about a quarter of a million troops, [to where] by the time of Diocletian they had somewhat over 600,000. So the army itself had doubled in size in the course of this inflationary spiral, and obviously that contributed greatly to the inflation. In addition, the administration of the state had grown enormously.

All these events strained the fiscal resources of the state beyond its ability to sustain itself, and the debasement and the taxation were both used to keep the ship of state going; frequently by debasing, then by taxation, and then often simply by accusing people of treason and confiscating their estates.

One of the Christian fathers, Saint Gregory Nazianzus, commented that war is the mother of taxes and I think that's a wonderful thing to keep in mind: war is the mother of taxes. And it's also, of course, the mother of inflation.

Salvian tells us, and I don't think he's exaggerating, that one of the reasons why the Roman state collapsed in the 5th century was that the Roman people, the mass of the population, had but one wish after being captured by the barbarians: that they would never again fall under the rule of the Roman bureaucracy. In other words, the Roman state was the enemy, the barbarians were the liberators. And this undoubtedly was due to the inflation of the 3rd century. While the state had solved the monetary problem for its own constituents, it had failed to solve that monetary problem for the masses and continued to use an oppressive system of taxation in order to fill the coffers of the ruling bureaucrats and military.

http://www.lewrockwell.com/orig10/peden1.1.1.html

As I've always said, fiat money is, fundamentally, a system of war finance. The Federal Reserve started operations in 1914; so did World War I. Permanent war engenders inflation and loss of freedom.  And here we are, getting paid in sloppily-printed scrip, toiling under the omnipresent gaze of the neofeudalist database surveillance state, and being urged to 'support the troops' as they endlessly grapple with opium-financed barbarians in obscure foreign provinces.

Yes, it all rhymes, don't it? Read Peden's conclusion again -- the Roman state coped reasonably well with inflation; but inflation alienated the people to the point of destroying the state's legitimacy.  SIgh! Statists -- when will they ever learn?

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MarkM
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Re: Inflation and the Fall of the Roman Empire

...and in our country the "military" is growing to include the state and local police forces.  There is certainly an attitude of being "at war" rather than "protecting and serving".  I believe it is being fostered by the Federal government so that they may have more control over local "agents of coercion".

In nearby Dallas, Texas it was announced this week that, due to a 190 million dollar budget gap, 800 city employees would be receiving pink slips.  However, the Dallas PD is adding almost 200 officers...with a portion of that expense coming from the Feds and their fiat financing.  The war financing is present right down the street as well as in obscure foreign provinces.

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Woodman
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Re: Inflation and the Fall of the Roman Empire

There's a cool series of podcasts on the History of Rome here:

http://thehistoryofrome.blogspot.com/

Also, Dan Carlin is currently doing an amazing podcast series on the fighting between Germany and the USSR during WW2:

http://www.dancarlin.com/disp.php/hh

Both these can be subscribed to iTunes.

History gives us an important reminder of how wars over power and resources have been going on for centuries, and what crazy things leaders can do and how desparately bad things can get!

Tom

 

 

 

JAG's picture
JAG
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Re: Inflation and the Fall of the Roman Empire

Machinehead,

If you haven't already read it, you might like Martin Armstrong's  How All Systems Can Collapse Overnight

Lots of good info on inflation in 3rd century Rome in it.

 

"Got a Machinehead, its better than the rest."

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xraymike79
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Re: Inflation and the Fall of the Roman Empire

Thanks for the song JAG,

Here's another for the Police State:

 

.
 
 
JAG's picture
JAG
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Re: Inflation and the Fall of the Roman Empire

Xray,

As self-declared Captain of the Sheeple, I don't think I like your song so much:)

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xraymike79
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Re: Inflation and the Fall of the Roman Empire

 

Come along little sheeple to that building on the hill.  Yes, right this way.....Oh don't mind that high pitched buzzing sound or the red stains on the doors. Come right in..................

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Davos
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Re: Inflation and the Fall of the Roman Empire

Our only hope is that they collapse and a Ron Paul gets elected and upholds the Constitution and gets rid of all this ridiculousness, from the "Fed" to the nanny state to they police state.

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Segestan
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Re: Inflation and the Fall of the Roman Empire

Between 250 AD and 300 was the invasions of the Northern Hives. Millions of barbarians( many Christian converts) poured into the Roman World. Roman coinage naturally was more needed than ever and the Empire was very unstable as the hoardes of invaders conquered Gaul and most of Italy , their banners could be seen from Rome. Most of the invaders left after looting and killing.

The article is very deceptive.

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investorzzo
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JAG's picture
JAG
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Captain Sheeple News

Xray,

I just heard the latest Captain Sheeple News, and there is a rumor of Sheep Casserole Recipes!

Captain Sheeple News Brief (mp3)

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Mike Pilat
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Re: Inflation and the Fall of the Roman Empire

Thanks, Machinehead. Not only for the article but also for the link that I found on Lew Rockwell's site. I have spent a good bit of time reading the articles at the Mises Institute, but I just now have discovered the weeks worth of high quality audio lectures available for free. It seems I've now got more material to learn from every time I drive.

Davos: I agree with your sentiments. The latest government power grab (healthcare) seems to have stirred up a wasps' nest of frustration and anger. In this environment, the likes of Peter Schiff and Rand Paul ought to do well in their senate bids. Let us just hope the concern level stays high among the citizens.

P.S. Rand Paul is having a moneybomb on his site (http://www.randpaul2010.com/) tomorrow...I don't want to be prodding, but lately it seems that dollars have far more political clout than poll results...

Cheers,
Mike

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