Monday, March 24, 2008
The Economics of Conquest
Yesterday we saw that when Octavian [later Augustus] and Mark Antony had 2,300 people killed and seized their property and put it on the market in Rome in 43 BCE, it caused property values to collapse.
Then Octavian and Antony whupped Brutus and Cassius and then, twelve years later, Octavian whupped Antony and Cleopatra, conquering Egypt in the process.
"Possession of Egypt solved Octavian's financial problems once and for all," Anthony Everitt explains in his biography of Augustus. "When in due course the country's bullion reserves were transported to Rome, the standard rate of interest immediately dropped from 12 percent to 4 percent.
"There was plenty of money to settle his accounts with the veterans and to buy them all the land they required [unsurprisingly, land values doubled]. Ample reserves were also available for investing in public works, and the much-tried people of Rome received generous individual money grants."
All's well that ends well.
Reminds me of a prudent investment made by Elizabeth I of England, aka Good Queen Bess:
"With the share received as a stockholder in Sir Francis Drake's voyage of the Golden Hynd," writes Robert Heilbronner in The Worldly Philosophers, "Queen Elizabeth paid off all England's foreign debts, balanced its budget, and invested abroad a sum large enough, at compound interest, to account for Britain's entire overseas wealth in 1930!"
Let's hear it for pillage and piracy!
¶ 4:02 PM
