BREAD AND CIRCUSES
A year ago I was fortunate enough to visit Rome and stand in the ruins of the Forum. Nothing else quite conveys the grandeur and greatness of Roman civilization. A new book, The Rise of Rome, explains the reasons for this success. It’s the same reason the U.S. grew great, “favorable conditions for production and trade.” The market economy, with its trade and commerce built Rome.
To explain the downfall of the Roman empire, I rely on the famous historians Will and Ariel Durant. “To support officialdom – the army, the court, public works, and the dole – taxation rose to such heights that men lost incentive to work or earn, and an erosive contest began between lawyers finding devices to evade taxes and lawyers formulating laws to prevent evasion. Thousands of Romans, to escape the tax gatherer, fled over the frontiers to seek refuge among the barbarians.”
Doesn’t that sound familiar? The same high taxes, big government and excessive regulation that destroyed a once prosperous Roman civilization are in the process of doing the same thing here. Rome began to penalize the successful with smothering taxation and reward the unproductive with a dole (free bread and entertainment).
Eventually under the Emperor Diocletian in 301 AD, Rome fully embraced socialism. The bureaucrats feathered their own nest just as today’s unionized government employees have established higher wages and superior benefits for themselves. Under socialism Roman civilization withered and died.
The great economist Ludwig von Mises explains why Rome failed and why we are failing. “Socialism is not in the least what it pretends to be. It is not the pioneer of a better and finer world, but the spoiler of what thousands of years of civilization have created. It does not build; it destroys. For destruction is the essence of it. It produces nothing, it only consumes what the social order based on private ownership in the means of production has created.”
Mises went on to explain what happens to a civilization that embraces government intervention and socialism. “A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society. Socialism is not an alternative to capitalism; it is an alternative to any system under which men can live as human beings.”
If this frightens you then well it should. We are at the point where the welfare recipients and the subsidized are in control of who wins our elections. That means more government spending and higher taxes until the capitalist and entrepreneurs have been liquidated. Unfortunately, limitless borrowing is impossible and the markets will begin to abuse the dollar. As the value of the currency diminishes in the face of an inflationary holocaust the government will resort to even more socialism. Historians will write about the reasons for the decline and fall of America as they do about Rome. Basically Rome disappeared as a viable city. Its population shriveled. With our huge population of subsidized citizens (many of low character) there will be safer places in the world.
How do you and your loved ones negotiate the coming events? Our money is rotting and the common prescription to offset its demise is to buy gold. We demure somewhat. A better prescription is to own silver. There’s much less of it above ground. It has far more industrial demand and expanded uses. Furthermore it has the mysterious machinations of the paper futures market which as our silver analyst Mr. Butler has pointed out for many years must eventually be reckoned with and gloriously impact the price.
It should be clear to any observer that we are moving in dramatic fashion away from the things that made us great – limited government, low taxes, free markets, and a rugged individualism that spurned the dole. We cannot survive socialism with any semblance of American greatness. No country has ever prospered for long under government intervention. The U.S. with its deficits and runaway government spending is doing a financial high wire act. By embracing more central bank inflation and other socialist schemes we ensure a terrible fall to the sawdust floor below. The Romans never saw their collapse coming. Most Americans are equally clueless. Nothing is so blind as the citizenry of a civilization in decline. However, once you suspect what is going to happen you can prepare and ready yourself. Factor our warnings into your thinking. So it is written, so it shall be.
