But money does not play the same role in all systems of social life and production. For this reason, these chapters make no claim to offer a general theory of money across the ages. Theory must be specific to its historical objects of study. Instead, these chapters proffer a unique historical account of money: one that demonstrates that in all class societies money is enmeshed in practices of domination and expropriation.16 I further suggest that three modular forms of general-purpose money can be identified in the broad sweep of socioeconomic history, all of them issued by states: metallic coinage, paper banknotes legally backed by precious metal, and paper fiat money untethered to any commodity. The classic instances of each emerged, respectively, in the silver coins of ancient Athens, the notes issued by the Bank of England (founded in 1694), and the US dollar following its detachment from gold in 1971. Each of these modular forms characterizes a historical epoch.17 Equally significant, I show that each developed as a solution to specific challenges associated with war finance. That war was endemic in ancient Greek society is obvious from even a passing acquaintance with Homer’s epics. That it was also deeply imbricated in the emergence of money is a central argument of the first two chapters, which also point to imperial Rome as the heir to Greece’s monetary innovations.
Long after the demise of the Roman Empire, coinage continued to operate as the modular form of money in Europe, the Middle East, and Asia. Notwithstanding a decline in the degree of monetization in Europe after Rome’s collapse, metallic coinage remained the prevailing means of payment and exchange. As Eurasian commercial life accelerated in the later medieval period, so did military conflict.18 By 1270 CE, silver coins and bullion comprised a form of world money that lubricated trade from Western Europe to China.19 And just as war became increasingly commercialized in this period, so commerce became increasingly militarized. One scholar observes that for six centuries in Europe, from the Middle Ages into the early modern period, “people bought and sold military manpower like a commodity on the global market.”20 This refers, of course, to the purchase of mercenary soldiers. So historically significant were mercenaries that, in the thirteenth century CE, Egypt came under the rule of descendants of enslaved mercenary soldiers, known as the Mamluks.
As we move into the era of the rise of capitalism in Europe, war and the hiring of mercenaries moved into higher gears. With states seeking new means of conducting and funding military conflict, the Bank of England perfected its machinery of war finance. In so doing, it established the second modular form of money. But it could do so only on the basis of new social relations of production and a new form of political power, one that internalized market imperatives within the very heart of the modern state. The power of capital, and its necessary manifestation in war, became constitutive of the bourgeois order.21 Just as modern banking was a regime of war finance from its inception, so was capitalism a system of war capitalism—and it remains so today.22 This is the story at the heart of chapters 3 and 4.
By the twentieth century’s Thirty Years’ War (1914–45), the United States had attained dominance within global capitalism. Essential to its rise was a long internal struggle to adopt the second modular form of money, paper notes tied to gold and secured by a central bank. But, as much as it ascended to imperial hegemony through this form of money, the United States was also to destroy it. At the height of the Vietnam War, in 1971, the monetary arrangements integral to war capitalism underwent a seismic shock when the US government disconnected its currency from gold, thereby reconstituting the dollar as an imperial fiat money. Since then, state fiat monies have become the general form of late capitalist money—its third modular form—and have brought with them new modalities of financial turbulence and turmoil of the sort witnessed in the 2009 global financial crisis. I explore this epochal departure, and its lasting reverberations, in chapter 5.
In writing a counter-history of money organized around ancient Greece and Rome, Britain, and the United States, there is a risk that the reader will imagine these to be the world’s great innovators. Yet, even in the domain of empire, these states were often mere imitators. One can make the case that the empires of Persia, Babylon, and early Islam, and those of the Mongols, Ottomans, Mughals, and Khazars, exceeded what the Greeks achieved in many domains. The Mongols under Genghis Khan (Temüjin) and his successors, for instance, established “the largest land empire in history.”23 And China undertook the world’s first sustained experiment with paper money, albeit one that collapsed and thus failed to establish a new modal form (outlined in chapter 2). My focus is on Greece, Britain, and the United States only because their exercises in destruction and domination, war and empire, were underpinned by monetary innovations that became generalized. This is also why they figure prominently in the global history of colonialism, which is a central part of the story told here. All of this further serves to remind us why anti-colonialism is essential to the prospect of a world beyond empire and war.
The chapters that follow also deploy an interdisciplinary approach to the study of money and its history. Epic poets—like Homer and Hesiod—enter our analysis, as do novelists such as Daniel Defoe and Herman Melville. This has to do with the capacity of literature to break through the obfuscation that so frequently surrounds economic questions, particularly monetary ones. As the gadfly economist John Kenneth Galbraith observed, “The study of money, above all other fields in economics, is the one in which complexity is used to disguise truth or to evade truth, not to reveal it.”24 And these evasions at the heart of mainstream economics serve to protect power and privilege. To the degree to which they pierce such mystifications, poets and philosophers often have more to teach us about the study of money than economists do.
This volume is thus intended as a work of demystification. It is also “an experiment in history, solidarity, and hope,” to borrow a formulation from radical scholar Vincent Harding.25 The history it traces is one of money, slavery, empire, and war. The solidarity it embraces is with the oppressed across the ages. And the hope it nurtures is in a future free of violence and oppression. I will have succeeded if this work makes some small contribution to that cause.
CHAPTER 1
“Droves I Took Alive and Auctioned Off as Slaves”
War, Slavery, and Ancient Markets
Half a century before the dawn of the Christian era, a Roman provincial governor gazed with delight at the loot from a recent military campaign. Exulting in his gains, the governor, known to posterity as Cicero, dashed off a letter to a friend. “As I write,” he enthused, “there is about 120,000 sesterces on the platform.”1 In fact, there were no sesterces, the predominant Roman coin of the time, atop the platform he regarded. No, rather than coins, it was human beings he observed—enslaved humans, taken as plunder by the army. Yet, Cicero was in one sense speaking truthfully. What he perceived was indeed a heap of coins. After all, the people before him were commodified humans, readily translatable into a monetary equivalent. Our Roman politician might not have known their names, but he knew their approximate market value. So developed was exchange in enslaved humans, so routine was the economic transformation of persons into money, that Cicero simply performed the conversion in thought. What he saw on the platform was just what he reported—sesterces, piles and piles of sesterces.
To perceive human beings as heaps of coins requires a distinctive intertwining of slavery, markets, and money. In the ancient Greco-Roman world, these had evolved in tandem, each indispensable to the other. Today, liberal exponents of markets and money disavow these interconnections. Even in a heterodox work in economics, we still find claims to the effect that the invention of money and finance represented “a great civilizational advance.”2