The Church and economics

[Owen Jones]

Here is an interesting, short article on the foundation of free economics (capitalism) in the Medieval Catholic Church. But as with most Catholic historians, Novak says nothing about the economic history of the Eastern Catholic Empire. Does anyone know of any sources on this? Surely, Constantinople went through a long period of economic prosperity (before being sacked by Roman Catholic fanatics).

http://www.acton.org/publicat/randl/article.php?id=344

[Margaret Lark]

This would ordinarily be my *last* recommendation, but the December 1983 issue of National Geographic did in fact go into some detail on the subject of Constantinople's economy, while Western Europe was in the throes of the Dark Ages. They had quite a nice spread on Mount Athos and Constantinople -- that was back before they discovered Political Correctness....

[John Curtis Dunn]

Thanks for the link Owen, this is also a current topic of interest for me.

Has anyone ever read The Byazntine Commonwealth by Dimitri Obolensky?

john

[M A Jackson-Roberts]

Owen;

in response to your post 628 I think you may find the bibliographies in (separate) seminal works on Byzantium by the authors Vasiliev and Ostrogorsky of some use in this regard.

the seeker

[M A Jackson-Roberts]

PS on the Church and economics:

yes, I have a copy of and have read the work by Obolensky that was cited.

the seeker

[Owen Jones]

Margaret,

Can you summarize what you have studied regarding the political economy of Constantinople and the wider imperial economy?

[Margaret Lark]

Absolutely nothing! I wasn't aware I had given the impression that I had done any study into this whatever, and apologize for having created that impression. I was simply noting that this article in National Geographic had quite a bit to say about the contrast between the Dark Ages in the West, and the thriving economy of the East. It discussed things like the taxation system (7% flat tax, IIRC), the penalties for business fraud (of particular interest to this accountant), and the social-welfare system -- all at complete odds with everything we understand about economics in the West, and all making infinitely more sense than our current scatterbrained approach to social ills.

Since reading that article, during my studies towards a degree in accountancy, I've become aware that Western economics is founded on the Principle of Scarcity (and for the life of me, I can't remember who articulated it -- I want to say, someone in the 17th or 18th century), namely, that supplies are limited, so the first on the scene had better grab all he can get. I can relate to that; I grew up the oldest in a household of 5 kids! But we also learned that in Eastern economies, the Principle of Abundance holds sway: There's Enough for Everybody. And that's actually a healthier economic principle.

As a student of accountancy, I learned that my primary responsibility was to "maximize profit for the shareholders" (Principle of Scarcity). But the paper I presented for my graduation made the point that society is better served if an accountant maximizes profit for the *stake*holders -- that's everybody. A little less monetary profit for the shareholders, but workers who are motivated to work hard because they are secure in their jobs, which results in a better product, which results in a more satisfied customer, which results in (well, golly gee) higher profits. Where did I get that thesis? From the National Geographic article. What kind of grade did I get? :D (No, that's not a D!!!)

[M A Jackson-Roberts]

seeker to Lark;

I think Owen's comment was addressed to me (another Margaret) since I am by training and avocation a medieval historian. I shall need to do a spot of revision before posting an answer, though, as my Byzantine studies are a bit rusty.

seeker

[Owen Jones]

Dear Margaret,

I've never encountered a medieval historian who agreed that it was a "Dark Age." And, of course, the flaw of "western" historians is that they confine their European cultural and religious history to the Western Roman Empire and afterwards. Nothing on the East. Was there any period in the East that was referred to as a Dark Age? Other than since 1453?

[Margaret Lark]

I was going to ask, "Which Margaret," until I saw my e-mail address in the Reply frame. I need a new name. How about Zhavronok??

No, in my very limited knowledge, the closest thing the East has to a Dark Age is the Sack of Constantinople, and then of course the Fall of Constantinople in 1453. I recall learning that the latter event was a great blow to the Venetians, who had come to depend on that particular trade route to "Cathay" (*there*'s ancient history for you!!). And I often get the impression, from the many Greeks I know locally, that they *still* have not recovered from the Turkokratie.

[John Curtis Dunn]

To pick one particuliar era out of the whole, I would particuliarly like to learn of the situation during the time of St. John the Almsgiver...have any references?

john

[Fr Averky]

Dear in Christ John,

There is a book which came out in about 1984 entitled "Three Byzantine Saints," which contains the life of St. John the Almsgiver, St. Daniel the Stylite, and one other, but I do not recall. Of course, the account is hagiographical, so I do not know if it would include the information you seek. At any rate, it is a an interesting and pious account of saints that should be better known. I find that only in the last few years has there been much interest in my patron saint, St. Abercius of Hieropolis, who reposed in 167 A.D. (not C.E.) The stele, written in Greek, at his command, and which is biographical, is considered to be the oldest Christian document so far.

respectfully,

Fr. A.

[Fr Averky]

Deare John'

In regards to St. John the Almsgiver, there is a book that came out in about 1984 entitled "Three Byzantine Saints," and one of them is about that wonderful saint. Of course, the account is hagiographical, so I do not know if it has any of the information you desire.

In Christ,

Fr. A.

[M A Jackson-Roberts]

I have always thought that use of the term "Dark Ages" was a misnomer, Owen. It simply denotes a period from which few histories have survived, and as we now know, archaeology can help to fill some of the gaps and lighten the darkness.

Now, I do not pretend to any expert knowledge of Byzantium/Constantinople, only a general interest. (And yes, I have been there.) In addition, I have not done any original research in this field; my classical Greek is probably too vestigial, and I have not studied Byzantine Greek. I am primarily a toiler in the field of western monastic orders, especially the Cistercians. But to my knowledge there has never been a comparable designation of any era in Byzantine history as "dark" per se, though as Obolensky does say that there was a dearth of histories covering the period from 610-717 because of the need to express creative energies outward to defend the empire you could say this constitutes some inferred equivalence.

What follows is a very simple summary of some of the main indicators as to the health or otherwise of the Byzantine political economy. It is much too profound a topic to be lightly treated of in one short post, and I do not pretend to any originality of thought in presenting the topic.

It seems that Constantinople/Byzantium was threatened from the first from a variety of causes, occasioned by its geographical location and by the challenges posed by rival power foci as different peoples rose to prominence - notably the Persians, Slavs, Arabs and Bulgarians. Once the trade links were threatened or interrupted weakness was bound to set in; the Crusaders in 1204 may well have been responding to this perceived weakness, indefensible though their actions now seem. As Obolensky comments, the wonder is that the empire survived for so long rather than its eventual fall in 1453.

In summary, the main factors in the political economy of Constantinople would appear to be:

external:

-disruption of trade links, contracting resources and gradual isolation of the city from its hinterland with the loss of the eastern imperial provinces (Syria, Palestine, Egypt, North Africam, and particularly Sicily, the granary of the ancient world)
-military defeat, eg Achelous in 917, Manzikert and Bari in 1071
-threats from other powers; Slavs, Arabs, Persians, Bulgarians, the Ottonians, and of course the Latin crusaders and the Turks
- legal codes: the Ecloga, Justinian's Institutes

internal:

- religious controversy, notably the iconoclast disputes, the Bogomil heresy
- imperial weakness, eg diplomatic failures, notably with regard to Rome
- the cultural divide between the Greek and barbarian (ie non-Greek) elements in the population to the detriment of the latter as a vigorous dynamic force
- harmony, or what Obolensky terms a "symphonic" relationship between church and state; much aspired to but seldom realised.


Constantine V's proscription of monastic life and confiscation of the monastic estates in the mid 8th century could also be adduced as having had a similar effect to that of Henry VIII on the English political economy (suppression of the monasteries) or Philip IV of France (suppression of the Templars) but without it seems the same distributive benefits for education.

BTW, I checked Ostrogorsky and Vasilev for further references, as well as Obolensky. The two latter authors cite plenty of sources, but Ostrogorsky none at all. Oh to have such a polymathic brain and compendious knowledge of one's subject.

the seeker

[John Wehling]

Owen and co.,

This has basically been stated already by Margaret/seeker, but I was reading Ostrogorsky last spring off and on (alas, mostly off) and he does deal with the empire's economics at every stage of her history and in a way that, to my untrained economic mind, seemed fairly in depth. Perhaps his work is dated, particularly in regards to economics, I don't know.

Hope this helps,
Fr John

[John Curtis Dunn]

One of the primary propaganda tool used by the Turks to encroach upon Orthodox Christianity, was taxes. In some places, the Turks would promise tax relief (no taxation) if cities would convert to Muhammadism. The heavy burden of taxation placed upon them by Constantinople became a motivation for several cities to officially convert to Allah, which also further weakened the military strength of Byzantium.


john

[Christopher Kingsman]

My background is not in economic history, but financial analysis. I have put a few comments at the end regarding how the Byzantine economy could differ from our "modern" economy. To put the comments into context a quick summary of inflation is required (I hope it makes sense to the reader):

One of the recurring themes in economic history is currency debasement, which usually results in the eventual collapse of the local economy (and potentially the government and with it the rule of law too).

In the days when gold and various other metals were the currency itself, currency debasement was "achieved" by clipping coins, thus the mint would be able to issue more coin with the same metal. Of course there was severe punishment in
store for private citizens engaging in that practice, nonetheless every state succumbed to the temptation in the end.

The twentieth century has seen the world's greatest inflations and since the 70s, governments no longer need to effectively clip coins, as there is no promise to convert the paper they emit into anything of any value. These days central bankers get paid to make sure that there is some inflation! In the past people knew that inflation means the government taking money from the citizens; modern propaganda has turned inflation into a universal benefit.

It is quite ironic that the supposedly rationalistic Western capitalistic system has delivered the most unstable system of paper currencies, whilst the long-forgotten Byzantine economy prospered with an undebased currency for about 800 years - the longest period of stable currency management in history. That is why the bezant (which at some point had an image of Christ on it) could be found from Ireland to China, as it was a trusted means of exchange for centuries. Compare that to the US dollar which has been devalued at least 5 times in the last two hundred years.

Margaret L contrasted the economics of abundance with the economics of scarcity. The currency equivalent is the difference between stability and instability.

Having a stable currency (e.g. the bezant) has the effect of 1) discouraging the use of debt (as one cannot hope for inflation to reduce the ultimate value of the debt) and 2) encouraging saving (as one can trust that the money not spent today will have the same value tomorrow, next year, next decade, etc.). Obviously a society which has little debt and net saving a crisis is more easily overcome than a society of the opposite make-up. However, it also means that an economy is less likely to "enjoy" feverish boom time when demand is artifically inflated by a government overspending and consumers taking on more and more debt.

By contrast, modern Western capitalism encourages debt (which means you are borrowing from your own future work for benefits now - compare that with Orthodox religious life which gives you the reward later for suffering now) and encourages spending the money you have, as the money will lose purchasing power in future (or if you are not going to spend it, you should invest it as risky as possible as you need to achieve high returns to maintain purchasing power).

Apologies for the lengthy post, but I hope these thoughts have been of interest regarding the subject of Byzantine economics.

[Owen Jones]

Thanks for the info about the economics within the Byzantine Empire. What kind of data do we have on median wealth or income, or relative prosperity of the Byzantine Empire? Or economic growth over time?

Just to quibble a bit, but classical "capitalism" favors a gold standard and a strong, stable currency, and savings. Modern populist economics advocated eliminating gold and silver standards so that especially farmers could more easily borrow money. Then Keynesian economics promotes government debt to encourage consumption and economic activity. Then comes along "supply side economics," really an updated version of Says Law, which says that some inflation is necessary for an expanding economy and capital formation. And Friedman, who says that money supply ought to expand at a steady rate of 3% in order to supply the money necessary for economic growth without inflation. In another words, Friedman argues that without a means of expanding the money supply, there becomes a shortage of money viz a viz the need for capital. But the Austrians, who are classical capitalists oppose Friedman, Keynes and Laffer (supply side) and argue in favor of a gold standard and fixed rates of currency exchange. So, inflation is not a modern capitalist position per se. The most ardent capitalist money theorists oppose central banks, oppose the ability of the government to print any money, and believe there should only be private banks issuing their own bank notes which one can buy as a commodity and assess their value by studying how much asset reserve each bank has behind the money it prints. So there is a wide range of theories about money.

[Christopher Kingsman]

I am not an economic historian, nor even an economist, so I wouldn't want to delve too deeply into economic theory (as I would be out of my depth). You are right of course that the classical "capitalism" favours a gold standard, but I was obviously refering not to classical (theoretical) capitalism, but to its modern application. Not only could the classic capitalists not conceive of an economy without sound currency (they would have considered people mad who believe that a government in control of the printing press and money that is a promise to pay nothing, could produce lasting prosperity), they would have also been quite shocked that capitalism had been shorn of any Christian ethics. No longer is society on a path towards becoming more Chrisitian, but becoming ever more consumerists. Maybe one should not refer to modern capitalism as "capitalism", but as "consumerism".

With regard to data, I do not have any and I would be surprised if much primary data were available. But given that there were probably not many innovations between the 4th and 15th century AD, growth would have equalled the rise and decline of the population of the empire. This may be boosted by trade, but certainly nothing like the growth figures of the 20th century would appear likely.

[Owen Jones]

But some one must have written an economic history of the Byzantine Empire? I have a running argument with people who make it sound like there was no prosperity in the world prior to Adam Smith. Or that it was limited to a very small class.

[Christopher Kingsman]

My personal thought would be that the question regarding prosperity would need to be directed away from economic figures to yield any fruit from an Orthodox perspective.

First of all prosperity is probably misunderstood. Websters defines prosperity as "the condition of being successful or thriving". I suspect that most people actually see $$$ signs when they think of the word prosperity; the reason is that today's society defines most forms of success in monetary terms.

But if you think about what people actually want - it is NOT as much dollars as possible (or even as much material goods as possible). What endless studies have shown is that what people want and need is happiness/contentness within a meaningful life.

The irony is that what is condusive to contentness is little difference in wealth between people (or at least those people you would compare yourself to). So in a stratisfied society the farmer does not compare himself to the aristocracy as they are a different class (unless there are fundamental grievances of being mistreated or not being able to survive on ones labours). So a farmer in Byzantine Anatolia could well feel more prosperous than a modern-day worker, who under a system of democracy and capitalism has the world as his peers and is sure to find plenty of workers who got rich on stock options or are the embodiment of the American Dream or who can afford an SUV when he can't...

The point in the end is whether a society is leading its members towards real prosperity or is only producing superficial prosperity (which is easily measured in dollars).

Of course the ultimate Orthodox perspective is that we should not love the things of this world, nor to seek for prosperity here on earth, but to build our trasure in heaven. As St Seraphim said, we should "trade well", so that we may acquire the Holy Spirit.

[Evan]

Dear friends,

I thought I'd revive this very old thread to raise an issue relevant to a series of fiscal policy discussions I've had lately. These discussions have related to the morality of taxing and spending policies that have the effect of transferring wealth earned through investment in capital instruments and/or through personal labor to others who lack such wealth-- and operate in substantial part by taking a greater SHARE of income from those whose income exceeds certain levels than from those who fall below such levels. That is, by "progressive" taxation-- which can be distinguished from "flat" taxation of the sort associated with tithing.

May Christians "agree to disagree" about such questions about fiscal policy? Is there a point at which the seizure of Naboth's vineyard is appropriately brought to bear upon the discussion? If so, how does one go about identfying it?

In Christ,
Evan

PS: I've just now begun to make my way through a thread in which this issue was debated at length. So, perhaps revisiting it is not worthwhile. Apologies if this be the case.