Whether you prefer to say Rome fell (in A.D. 410 when Rome was sacked or in 476 when Odoacer deposed Romulus Augustulus) or simply morphed into the Byzantine Empire and medieval feudalism, economic policies of the emperors had a heavy impact on the lives of the citizens of Rome.
Primary Source Bias
Although they say history is written by the victors, sometimes it's just written by the elites. This is the case with Tacitus (c. A.D.56-c.120) and Suetonius (c.71-c.135), our primary literary sources on the first dozen emperors. Historian Cassius Dio, a contemporary of Emperor Commodus (180-192), was also from a senatorial (which, then as now, meant elite) family. Commodus was one of the emperors who although despised by the senatorial classes was loved by the military and lower classes. The reason is mainly financial. Commodus taxed* the senators and was generous with the others. Likewise, Nero (54-68) was popular with the lower classes, who held him in the kind of reverence reserved in modern times for Elvis Presley -- complete with Nero sightings after his suicide. (Also see Emperor Domitian.)
- Nero and other emperors debased the currency in order to supply a demand for more coins. By debasing the currency is meant that instead of a coin having its own intrinsic value+, it was now only representative of the silver or gold it had once contained. By the time of Claudius II Gothicus (268-270 A.D.) the amount of silver in a supposedly (100%) silver denarius was only .02%.
This led to or was severe inflation, depending on how you define inflation.
See Mapping History's chart of silver content and soldiers' wages.
Especially luxurious emperors like Commodus, who marked the end of the period of the five good emperors, depleted the imperial coffers. By the time of his assassination, the Empire had almost no money left.
The Roman Empire acquired money by taxation or by finding new sources of wealth, like land. However, it had reached its furthest limits by the time of the second good emperor, Trajan, during the period of the high empire (96-180), so land acquisition was no longer an option. As Rome lost territory, it also lost its revenue base.
Dates of the 5 So-Called Good Emperors and Commodus
1.) 96 - 98 Nerva >> 2.) 98 - 117 Trajan >> 3.) 117 - 138 Hadrian >> 4.) 138 - 161 Antoninus Pius >> 5.) 161 - 180 Marcus Aurelius >> 177/180 - 192 Commodus
Rome's wealth was originally in land, but this gave way to wealth through taxation.During the expansion of Rome around the Mediterranean, tax-farming went hand-in-hand with provincial government since the provinces were taxed even when Romans proper were not. Tax farmers would bid for the chance to tax the province and would pay in advance. If they failed, they lost, with no recourse to Rome, but they generally made a profit at the hand of the peasants.
Keith Hopkins says that the diminishing importance of tax-farming at the end of the Principate was a sign of moral progress, but also meant the government couldn't tap private corporations in the event of an emergency. The means of acquiring crucial monetary funds included debasing the silver currency (seen as preferable to increasing the rate of taxation, and common), spending reserves -- depleting the imperial coffers, increasing taxes (which was not done during the period of the high empire), and confiscating the estates of the wealthy elite. Taxation could be in kind, rather than coinage, which required local bureaucracies to make efficient use of perishables, and might be expected to produce reduced revenue for the seat of the Roman Empire.
The Cato Institute (a modern free-market think tank) says that emperors deliberately overtaxed the senatorial (or ruling) class in order to render it powerless. To do this, the emperors needed a powerful set of enforcers -- the imperial guard.
Once the wealthy and powerful were no longer either rich or powerful, the poor had to pay the bills of the state. These bills included the payment of the imperial guard and the military troops at the empire's borders.
Since the military and the imperial guard were absolutely essential, taxpayers had to be compelled to produce their pay. Workers had to be tied to their land.
To escape the burden of tax, some small landowners sold themselves into slavery, since slaves didn't have to pay tax and freedom from taxes was more desirable than personal liberty.
Tom Cornell, in The Beginnings of Rome, argues that in the early days of the Roman Republic, debt-bondage (nexum) was acceptable. What wasn't acceptable was usury or outrageous treatment. Nexum, Cornell argues, was better than being sold into foreign slavery or death. It is possible that centuries later, during the Empire, the same sentiments prevailed.
Since the Empire wasn't making money from the slaves, Emperor Valens (368? [see C.Th.X 12,2-4 and the probably later, C.J.XI 53,1) made it illegal to sell oneself into slavery.
The small landowner had become a feudal serf....
At least that's one interpretation.
By N.S. Gill
- The Fall of the Roman Empire, by Peter Heather, 2005.
- "How Excessive Government Killed Rome", by Bruce Bartlett, Cato Institute Volume 14 Number 2, Fall 1994.
- "Imperialism, Empire and the Integration of the Roman Economy," by Greg Woolf. World Archaeology, Vol. 23, No. 3, Archaeology of Empires (Feb., 1992), pp. 283-293.
- "Taxes and Trade in the Roman Empire (200 B.C.-A.D. 400)," by Keith Hopkins; The Journal of Roman Studies, Vol. 70, (1980), pp. 101-125.
- "The Other Transition: From the Ancient World to Feudalism," Chris Wickham, Past and Present, No. 103. (May, 1984), pp. 3-36.
- "Economic Stagnation in the Early Roman Empire," by Mason Hammond. The Journal of Economic History, Vol. 6, Supplement: The Tasks of Economic History (May, 1946), pp. 63-90.
*For more on the taxes on senators and their land, see "A Note on the collatio glebalis," by S. J. B. Barnish. Historia: Zeitschrift für Alte Geschichte, Vol. 38, No. 2 (2nd Qtr., 1989), pp. 254-256.
+ In 1932, Louis C. West wrote that in A.D. 14 (the year of Emperor Augustus' death), the supply of Roman gold and silver amounted to $1,700,000,000. By A.D. 800, this had dwindled to $165,000.[sic]000. Part of the problem was that the government would not permit the melting down of gold and silver for individuals.
From: "The Economic Collapse of the Roman Empire," by Louis C. West. The Classical Journal, Vol. 28, No. 2 (Nov., 1932), pp. 96-106