Economics (Part B)

As a matter of course, the United States has followed history to a degree by mimicking the Romans' economic policy of debasing the currency. The difference between these two is the new age tool we have available to us to back up our money which the Romans did not (and subsequently used the gold in their Solidus and silver in their Denarius to do so.) 

Today, we have a method at our fingertips that the Romans could only have dreamed of which we term the "Federal Reserve System." Amazingly, the Federal Reserve System permits money to be generated out of nothing, so to speak. In his article termed, "Empire of Debt" Lew Rockwell expresses how the American dollar has come so far from the gold and silver roots of its origins.[1] During the Jefferson presidency, government had no power to print currency or tax directly. [2] He goes on to explain, however, that "Today, all the money government could ever want is easily available via a monetary policy that depends critically on the capacity of the Fed to create currency out of thin air. The Fed's printing presses back every debt note issued by the Fed, and the new currency is sopped up by foreign central banks and private holdings around the world. The dollar is, for now, the world reserve currency, which permits the U.S. to sustain a world empire without paying the price - again, for now." [3] In this we hear resounding echoes from our near past, once again bringing ancient Rome into comparison with our present day superpower. Rockwell goes on to make a very interesting correlation between the two when he writes, "For the last 100 years, it (the American dollar) has lost value more quickly than the Roman denarius after Nero. No surprise, since it is much easier to create unlimited numbers of dollars than to mint coins with at least some silver or gold in them. On the other hand, by the time of the last emperor, the denarius - which started as pure silver - had .02 percent precious metal content. That is, the denarius had lost, over hundreds of years, 99.98 percent of its value. Since the founding of the Fed in 1913, the (American) dollar has lost 95 percent." [4]

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[1] [1] Lew Rockwell, “Empire Of Debt,” Huffington Post, last modified July 24, 2006, http://www.huffingtonpost.com/lew-rockwell/empire-of-debt_b_25666.html.

[2] Ibid.

[3] Ibid.

[4] Ibid. 

  In response to these startling similarities, one can only question the path that America is on. Is America mirroring the politics that brought economic destruction to ancient Rome? History would argue yes. While inflation in our country continues to increase, and national leaders seek to keep interest rates low just as Diocletian's failed "Edict on Prices", the two only prove to come closer in their correlations.  Stephen Bertman draws interesting contrasts in his academic journal termed, "The Perils of American Progress." In his journal, he draws comparisons from the two Empires and questions how long America's preeminence will last, being that no Empire in history has lasted without a fall, stating confidently, "It would be naive to imagine America will be exempt from the universal law of history that to date has dictated the decline and fall of every great power, including Imperial Rome."[5] In a academic masterstroke, Bertman draws comparisons between the two superpowers and advices today's current generation to learn from ancient history, stating, "Some optimists might inject at this point that if it took the Roman Empire five centuries to fall, America still has about three centuries to go. But such optimism fails to take into account the technologically induced acceleration of history itself within the context of an electronically connected world that instantly relays events and demands instant decisive reaction. It also fails to take into account modern technologies awesome destructive capabilities. The dramatic changes that once took centuries might require only years or, perhaps, only seconds." [6]

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[5] Stephen Bertman, "The Perils of America's Progress." Modern Age 48, no. 1 (Winter 2006): 22-27. Academic Search Complete, EBSCOhost (accessed November 14, 2012),

doi: http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=20847091&site=ehost-live

[6] Ibid. 

In response to these startling connections through history, the concept of American hyperinflation is indeed a possibility. Rome's demise was the consequence of a myriad of elements, with economic decease at the summit of such reasons. We have seen from the example of ancient Rome that when currency is largely debased, immense instability within a civilization comes close behind. Rather than asking whether the branches of Congress or the House of Representatives will go to the Democrats or Republicans in the near years to come, perhaps we should be asking whether or not America is following down the agonizing road of ancient Rome's example, consequently pulling "We The People" down with her.

Bibliography

Bertman, Stephen. "The Perils of American Progress." The Perils of American Progress , July 2006.

Rockwell, Lew. Empire of Debt. July 24, 2006. www.huffingtonpost.com (accessed November 14, 2012).