How Usury Destroyed the Roman Empire

A summary of Chapter 1 of A History of Central Banking and the Enslavement of Mankind By Stephen Mitford Goodson

This is a working document for a possible future video. Paid subscribers, feel free to lend your wisdom on these topics as we flesh out the details and wrangle with the contentions between modern writers, historians, those who were closer to the topic at hand, and those who dare voice an alternative explanation of events.

Money, being naturally barren, to make it breed money is preposterous and a perversion from the end of its institution, which was only to serve the purpose of exchange and not of increase... Men called bankers we shall hate, for they enrich themselves while doing nothing.

– Aristotle, Politics

The Roman era (753BC – 565AD) was a period of three distinct monetary systems, with three different metal units used for exchanging goods and services. Rome, founded by Romulus and Remus in 753BC, is believed to have been founded in Latium, a region surrounding the Palatine Hills. This area was Etruscan controlled from around 600BC until the Roman Republic was established in 509BC. The Etruscans, an Aryan people¹, created an advanced civilization and built roads, temples, and public buildings in Rome. The first "money" used in Rome was the cow, a barter system, as cattle were used by many early peoples as a medium of exchange. The cattle kept in Rome, over 3,000 in number, represented the treasury of King Augeas, according to the legend of Herakles and the Augean stables².

The Copper Age (753 – 267BC) saw the Romans adopt irregular lumps of copper or bronze, known as aes rude (rough metal), instead of cattle. This led to increased trade and prosperity in Rome, which was based on uncoined copper or bronze metal, issued by the Roman Treasury in the form of ingots weighing 31⁄2 lbs (1.6kg) with the full backing of the state, known as aes signatum (stamped metal). In 289BC, these ingots were replaced by discoidal, cast leaded bronze coins aes grave (heavy metal). These stamped bronze coins represented national money and “were paid into circulation by the state and [each was] only of value inasmuch as the symbols on which its numbers were recorded, were scarce or otherwise.” This money was thus based on law rather than the metallic content (although that content was standardised, and the coin did have some intrinsic value, unlike most coins today). This can be considered an early example of the successful use of fiat money.

Fiat money (that is, a currency that has no intrinsic value and is not backed by a physical commodity like gold or silver) can be successful as long as it is issued by the government, not by private bankers, and is carefully protected against counterfeiters. Non-fiat money, on the other hand, can have the disadvantage that whoever sets the prices of gold and silver, i.e., private bankers, can control the nation's economy.

Up to 300BC, the Romans experienced an unsurpassed increase in public and private wealth, particularly in land. After the Second Latin War in 338BC and the defeat of the Etruscans³, the Roman Republic expanded from 2,135 square miles (5,525 sq km) to 10,350 square miles (26,805 sq km), or 20% of peninsular Italy. The population rose from about 750,000 to one million, with 150,000 people living in Rome itself.

A partnership between the Senate and the people known as Senatus Populusque Romanus (SPQR) was formed, with political leaders known for their frugality and honesty. The means of exchange were strictly regulated, and there was zero inflation. Debt-bondage nexum⁴, where a free man offered his services as security for a loan + interest, was abolished after Plebian agitation by the lex Poetelia⁵ in 326BC.

The Silver Age (267-27BC) saw the destruction of the traditional money system in Rome when the patrician elite (the ruling class) gained the privilege to mint silver coinage. This change was exemplified by a patrician who converted a sack full of silver denarii to five times its original value by stamping a new value on the coins⁶. This is said to have been done at the Temple of Juno Moneta (from where we get the word 'money'). The early Roman silver coin, known as the drachma, was modelled on a coin used in the Greek south of the peninsula. It was later replaced with the smaller and lighter denarius, quinarius, sestertius, and victoriatus.

The Roman army, due to the scarce deposits of silver in the Italian peninsula, determined to conquer territories further afield to obtain supplies. This required more soldiers. Roman peasants were consequently drafted into the army, leading to a decline in agricultural production and the replacement of peasant farms with large estates worked by slaves. Wheat also had to be imported from North Africa. Tensions about granting citizenship and enfranchisement between Rome and her Italic allies resulted in the Social War⁷ (90-89BC). This lack of enfranchisement led to the fragmentation of Roman society and the alienation of working class citizens, who were treated as chattel and had no responsibilities towards the state.