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Series 9

People have created and spread wealth around in various ways throughout history. As a result, often only a very small part of society has benefited from the wealth, causing people to dream and try to set up different ways of sharing money around. But ideal systems don’t always work in the real world, just as real systems don’t always live up to ideals.

Karl Marx, 1875

From each according to his ability, to each according

to his need

Did you know?n Humans first began to develop agricultural societies in about 8000BC, a development that coincided with the growth of towns and cities.

n Writing is believed to have been developed for agriculture, commerce and trade. The first known forms of writing are thought to have been tallies for harvests or tallies of livestock.

n The legendary King Croesus (6th century BC) of the kingdom of Lydia amassed such a fortune that people use the expression “as rich as Croesus’’.

n The wealth of the church in feudal society was supposed to be beyond the power of secular (non-religious) authorities, but from time to time monarchs enriched themselves by confiscating church lands.

n The name “feudalism” was applied to the system only in the 18th century, when it was on its way out. It comes from the Latin word feudum, meaning fief (fee), which people working on the land had to pay to land owners.

n Although it was already undermined by the new middle class, the last vestiges of feudalism were only wiped away in France during the French Revolution, which began in 1789. Russia only formally abolished serfdom in 1861.

n The French briefly attempted to introduce a kind of socialism in their ill-fated Paris Commune of 1871. The Communards hoped that the rest of France would join in their revolt against the conservative government but other socialist revolts were repressed and the Commune was eventually crushed. About 20,000 Communards were killed, 38,000 sympathisers were arrested and some 7000 deported.

Sources and further study: The Ascent Of Money by Niall Ferguson (Penguin)The Big Picture Book Of Human Civilization by John Long (Allen & Unwin)A Concise Economic History Of The World by Rondo Cameron (Oxford)European History For Dummies by Sean Lang (Wiley)A History Of Economic Thought by William J. Barber (Penguin)Socialism A Very Short Introduction by Michael Newman (Oxford)Ancient Roman Economy unrv.com/economy.phpAncient Egyptian Economy reshafim.org.il/ad/egypt/economy/index.htmlThe Ascent Of Money (BBC DVD)Encyclopaedia Britannica

The monarch owned all the land in his kingdom, keeping a fifth as his demesne (for his own use). The rest of the land was granted to the church and the barons.

THE KING

THE CHURCH BARONS

Under-tenants worked for barons and church leaders, who granted peasants land. Peasants provided rent, tax and/or labour services.

UNDER-TENANTS

A large portion of the land was granted to the

church. Church leaders granted land to their under-tenants. Church tenants promised to supply soldiers at the monarch’s request.

About half of the land was administered by the barons, who granted land to under-tenants. The under-tenants promised to supply soldiers when the king needed them.

Middle-ages feudal tenure

CapitalismTHE SYSTEM that emerged in 19th century Europe after the demise of feudalism was based on private ownership of the means of production (factories, farms, mines, etc). It meant that most of the wealth was owned by capitalists who could invest in agricultural or industrial production, buying the labour of a large

working class.It was based on a market

economy, in which goods and services could be exchanged through the medium of money, subject to supply and demand.

Problems include cyclical downturns that cause

unemployment and poverty. Also, running an economy purely for profit can result in the exploitation of people and the environment. There is often still a wide gap between rich and poor (For more detail see Classmate 26, series 9, The World Of Money).

Rondo Cameron in A Concise Economic History Of The World (Oxford)

The lords fought, the clergy prayed, and the

peasants worked

SocialismSOCIALISM is a theoretical economic system in which the property and the means of production are in the hands of everyone in the society.

In a socialist system, instead of competing for markets, all people would be cooperating to produce what is needed, which would be distributed according to need. Ideally it would mean that people would never need money and would not need to accumulate wealth. Its theorists included French philosopher Charles Fourier and German philosopher Karl Marx, who wrote The Communist Manifesto in 1848.

There have been several attempts to introduce forms of socialism or systems calling themselves socialist:

RUSSIAN SOVIET COMMUNISMThe most notable example of an attempt to introduce socialism was the Union of Soviet Socialist Republics, which started with the Bolshevik Revolution in Russia in 1917. Under Soviet communism, meant to be a higher form of socialism, there was no private ownership of property, but a bureaucracy came to rule the country under a dictator. The bureaucrats and dictator lived a life of privilege while the ordinary people often struggled to survive. Soviet communism crumbled in the 1990s.

CHINESE COMMUNISMThe Chinese initially tried to model their system on Soviet Communism, collectivising agriculture and trying to catch up with other industrial economies in the “great leap forward’’. The scheme failed and since then the economy has become a mixture of public economic control and private enterprise.

GERMAN NATIONAl SOCIAlISMThe national Socialist German Workers’ Party, or Nazi Party, achieved a level of government control over its economy but it was socialism in name only. The system proved to be based on the exploitation of neighbouring economies, arms production, war, conquest, slavery and rule by a minority.

Ancient EgyptIN ANCIENT Egypt, members of the lowest level of society worked plots of land to support themselves but these plots were assigned to them every season by a bureaucracy. The bureaucrats, mostly priests, collected taxes and religious duties from the farmers, a portion of which was passed on to the pharaoh.

After harvest people also willingly donated their labour to large building projects such as the pyramids as religious duty to their king, who was seen as a god on earth.

Some farmers were able to hold onto a surplus to trade but the market was not large and most people did not need money. Much of the trade in markets was in the form of barter with a value system worked out against a standard such as a precious metal.

In return for land, serfs provided labour, free peasants paid rent.

Work like an Egyptian: Statue of

a slave

FeudalismFEUDALISM was a socioeconomic system that existed in most of Europe from about 500AD until the 18th century. In feudal society peasants generated wealth from agriculture on land owned by nobles or lords. The monarch granted the lords land in exchange for an oath of loyalty to the monarch. The lords collected taxes on behalf of the king, gaining wealth by allowing peasants, known as serfs, to farm their land in exchange for a portion of their produce and for services such as serving in the monarch’s armies or fixing roads.

Serfs gave an oath of loyalty to their lord and had to ask permission to marry, change jobs or travel outside the local fiefdom. In return the lord offered protection, solved disputes and dispensed justice. The lord’s land and the serfs’ obligations passed from generation to generation. Monarch, lords and peasants gave a portion of their wealth to the church; in return the clergy (priests and monks) provided education, charitable services and spiritual guidance.

Feudalism broke down in the 17th-18th centuries due to changes in farming, a growing middle

class of artisans and traders who rankled at the restrictions of

feudalism, and also the flow of labourers

leaving the land to work in

cities.

PEASANTS

Slave economiesIN ANCIENT Rome much of the wealth was based on large farming estates known as latifundia. The Romans needed large numbers of people to work for them for as little money as possible. They found this labour in slaves from conquered nations.

Slaves were owned by the person who bought them and usually worked only for their food and housing. Slaves were bound to serve their owner until death and in most cases the children of slaves also belonged to the owner.

Some owners gave bonuses or gifts that would allow slaves to buy their freedom, others granted them freedom, but most slaves died as slaves.

Labour-intensive farming industries, such as cotton in the southern states of the US, also relied on slave labour. Slavery was abolished there in the 1860s.

Influential: Karl Marx (top), Soviet dictator Stalin (centre), Nazi

posters and statue of Chairman Mao

Harsh: Loading a slave ship

Auction: 1700s slave market

Wealthiest people in historyIN ANCIENT times the wealthiest people were often

monarchs or nobles. The Egyptian pharaohs often had fabulous personal wealth. Pharaoh

Amenhotep III (14th century BC) is believed to have been the 12th richest person in history, according to a list compiled by Forbes magazine in 2007.

Also on the Forbes list, at number eight, was ancient Roman Marcus Licinius Crassus (pictured right), who increased his inherited wealth by investing in slavery, mining and property.

In the Renaissance a new kind of magnate arose, bankers, such as the Medici family of Italy, who became rich by lending money.

In the 19th century most of the wealthiest people were American financiers, stockmarket players and industrialists. In recent times, the technology boom has generated great wealth for tycoons, including Bill Gates (pictured left).

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Split society:A 14th century illustration of a medieval harvest