A History of Interest Rates by Sidney Homer, Rutgers University Press, 1963
Credit is sometimes considered a modern device or even a modern vice. It is true that a few new credit forms have been developed in our century and statistics reflecting the growth of the volume of credit during recent decades are impressive. But a glance through the pages of financial history will dispel the notion of novelty. Credit was in general use in ancient and medieval times. Credit long antedated industry, banking and even coinage; it probably antedated primitive forms of money.
For example, about 1800 B.C., Hammurabi, a king of the first dynasty of ancient Babylonia, gave his people their earliest formal code of laws. A number of chief provisions of this code regulated the relation of debtor to creditor. The maximum rate of interest was set at 33 1/3% per annum for loans of grain repayable in kind, and at 20% per annum for loans of silver by weight.
Twelve hundred years later, around 600 B.C., the legal history of classical Greece began with the laws of Solon. Drastic reforms were then called for by an economic crisis in Athens stemming in part from excessive debt and widespread personal slavery for debt.
The Romans also began their legal history with a body of laws regulating credit. This, too, was forced by a crisis characterized by excessive debt.
These three examples from the earliest days of historic Babylon, Greece and Rome are enough to support the conclusion that credit at interest was widespread enough to create major political problems before the emergence of written history.
Usury, or interest, was fundamental to the economics of these great civilizations, driving its unsustainable growth and eventual collapse. Modern civilization has the same trappings of past fates.
The Dance of Death by Chris Hedges
13 Mar 2017
The graveyard of world empires—Sumerian, Egyptian, Greek, Roman, Mayan, Khmer, Ottoman and Austro-Hungarian—followed the same trajectory of moral and physical collapse. Civilizations in decline, despite the palpable signs of decay around them, remain fixated on restoring their “greatness.” Their illusions condemn them. They cannot see that the forces that gave rise to civilization are the same forces that are extinguishing it. Their leaders are trained only to serve the system. And when the last moments of a civilization arrive, the degenerate edifices of power appear to crumble overnight.
Those who rule at the end of empire are psychopaths, imbeciles, narcissists and deviants, the equivalents of the depraved Roman emperors Caligula, Nero, Tiberius and Commodus. The ecosystem that sustains the empire is degraded and exhausted. Economic growth, concentrated in the hands of elites, is dependent on a crippling debt peonage imposed on the population. The bloated ruling class of oligarchs, priests, courtiers, mandarins, eunuchs, professional warriors, financial speculators and corporate managers sucks the marrow out of society. Capitalism ruthlessly commodifies human beings and the natural world to extract profit until exhaustion or collapse. Culture is degraded to patriotic kitsch. Education is designed only to instill technical proficiency to serve the engine of capitalism. Historical amnesia shuts us off from the past, the present and the future. Those branded as unproductive or redundant are discarded and left to struggle in poverty or locked away in cages. State repression is indiscriminant and brutal.
The elites’ myopic response to the looming collapse of the natural world and the civilization is to make subservient populations work harder for less, squander capital in grandiose projects such as pyramids, palaces, border walls and fracking, and wage war. Increasing military spending and taking the needed funds out of domestic programs typifies the behavior of terminally ill civilizations. When the Roman Empire fell, it was trying to sustain an army of half a million soldiers that had become a parasitic drain on state resources.