ACTA ACCLA, December 2004
CRISIS OF THE THIRD CENTURY
Hugh Kramer
At the dawn of the current era a giant bestrode the world. The
Roman Empire ruled from Britain to Palestine, from the shores of the Black Sea to the
Pillars of Hercules which are now called Gibraltar. Octavian, nephew and heir of Julius
Caesar had created a new empire from the ashes of the old Republic and took the name
Augustus as its first emperor.
Sounds a little bit like something out of Star Wars, doesn’t
it? Well it’s Spielberg’s version that’s derivative. This is the original and it was
nothing like the empire Darth Vader served.
At least not at first…
Augustus’ accession marked the beginning of 250 years of almost
unbroken peace known as the Pax Romana. This was an incredible accomplishment.
Europe had never known anything like it before and has never experienced anything like it
since. More than anything else that Rome did and more likely despite anything else they
did, this period of peace allowed the lands under Roman rule to prosper more than they ever
had before. And some of them have never achieved that level of prosperity since.
The coin of the realm was the denarius. It was made of nearly
pure silver and weighed nearly 4 grams. By the middle of the 3rd century CE, this high
silver content regular weight coin had degenerated to a hurriedly made, irregular lump of
copper with a thin coating of silver on it that wore away very quickly and the terrible
appearance of the coinage was a mirror of the condition of the empire as well. How did this
happen? What could have caused the mighty Roman Empire to sink so low and how did it
recover? Because it did recover and last another 150 years in the West and far longer in
the East.
The title of my talk today is the Crisis of the 3rd Century. It
is a period that saw the final collapse of the ancient world and the true beginnings of the
Middle Ages. Most people know next to nothing about it. History books say that 476 CE when
the last Roman Emperor in the West was deposed was the start of the Middle Ages. That’s a
date of convenience… and it’s wrong. This is the true story.
During the half century between 235 and 285 CE, the Roman
Empire and all of ancient civilization in the West passed through a terrible ordeal. From
without came wave after wave of barbarian invaders and repeated wars with the newly
resurgent Persian Empire. From within, disorder reigned as a result of continuous mutinies
of the armies and struggles for the throne by their generals. In the wake of the
devastation caused by invasions and civil war, epidemics ravaged the survivors. The
constant emergencies emptied the treasury and the frantic efforts of the imperial
authorities to collect more money drove people into beggary or flight, ate the heart out of
commerce and undermined the economic foundations of ancient society. Despairing of the
ability of the Empire to cope with the disasters, men set up independent states for their
own protection in both its eastern and western parts.
Eventually though, the soldiery were brought under control, the
soil of the Empire cleared of its foreign foes and its political unity re-established.
Victory was only achieved at great cost. Politically, economically, and culturally, the
Roman World that emerged from the ordeal was far removed from what it had been.
Graeco-Roman civilization had received a mortal blow and the dawn of the Middle Ages was at
hand.

Antoninianus of Caracalla
217 CE |
As the third century began, the Roman Empire looked,
superficially at least, as strong as ever. The city of Rome was nearly 1,000 years old and
its dominion over the vast territories it had conquered seemed unchallengeable. But there
were cracks in the façade of Imperial power, cracks that the strains of future emergencies
would widen and threaten the collapse of the entire structure.
Part of the problem lay in the failure of the Imperial system
to provide a stable means of succession. There was no constitutional means of replacing an
emperor that didn’t require him to be dead first: no elections, no term limits, no recall
and no impeachment; just palace coups, praetorian mutinies, military rebellions and,
occasionally, death from natural causes. The latter type, natural causes, grew increasingly
infrequent due to some peculiarities about the succession process. A new emperor, whether
he came to the throne through murder, dynastic succession, or both, had to have a base of
support. The fatal flaw of the Republic had been its inability to ensure the loyalty of the
army to itself rather than its generals. The emperors knew that at heart, whatever else
they may have said, the army was their real base of support. They tried to ensure this
loyalty through various means. Personal oaths were given to the emperor rather than the
empire. Pay, recognitions of valor and all advancements had to come through his offices.
The famous Roman triumphs could be celebrated only by the Emperor rather than by whichever
general had won the actual victory. Donatives, that is to say, gifts of money and other
things of value, were given to the soldiery upon the Emperor’s accession to the throne and
other important occasions.
It took a while before the soldiers realized just how crucial,
and profitable, their support was. Between 29 BCE and 235 CE the Roman Peace was broken in a
major way only by two short but sharp civil wars. In both cases, the war following Nero’s
suicide in 68 CE and the chaos following the murder of Commodus (the emperor in the movie
“Gladiator”) in 192 CE, the generals of armies from different parts of the Empire fought
over the vacant throne. Each promised his troops rewards for their support. The winners had
to deliver and the armies learned with whom the real power of the Empire lay.
The military’s realization of its political importance was only
part of the problem though. The army had a loyalty to the idea of Rome regardless of who
the emperor was and it was only when this was undermined by other factors that mutiny
became endemic.
When, in the time of Augustus, the army’s mission changed from
expansion of the borders to the defense of them, it had to change its character from a
largely mobile field force to a largely static defensive one. Initiative thus passed from
the empire to those who would attack it and the Romans had to expand their forces to occupy
defensive positions over a frontier that stretched from Scotland to the lower reaches of
the Nile. So from an initial strength of about 150,000 troops, it increased to 220,000 in
the second century and, as the barbarian threat grew, to about 400,000 by the opening of
the third.
As the army grew in size, so too did the need for money to
support it. A larger budget required more bureaucracy to collect and administer the money,
and the larger bureaucracy required more money to support it as well. The tax burden, never
light to begin with, grew until all of the empire’s surplus was eaten up by it and the
government as well as the economy teetered on a knife’s edge between sufficiency and
disaster. The slightest push, from a profligate emperor, an over-long war or other
emergency, could tilt it over the edge.
Unlike the enlightened government we enjoy today, ancient Rome
could not operate with a budget deficit. If there were no surplus in the treasury, then the
government had to raise money through extraordinary means. Marcus Aurelius collected
emergency taxes and raised funds by auctioning off his personal property and the palace
furniture. When, during the crisis, his soldiers petitioned for an increase in pay, he told
them “Anything you receive over and above your regular wages must be exacted from the blood
of your parents and relations”. (Cassius Dio, Epitome, LXXI, 3)
Less altruistic emperors raised money through extortion,
confiscation, debasement and even counterfeiting. However the money was raised, and whether
it met the requirements of the emergency or not, there was usually another effect of
pumping more money into a static economy: inflation. If there are only so many goods
available for purchase, having more money to spend on them just has the effect of driving
the price up. In a largely agrarian economy there is no way production can increase as fast
as a desperate government can increase the money supply. This rule of economics was not yet
known but while the Romans did not understand the mechanics of inflation, they could
certainly see its effects and they tried very hard to control and limit them where they
could. In fact, during the first two centuries of the Empire, inflation averaged out to
about 3% a year; an accomplishment most modern governments would envy.
For over a hundred years since the time of Augustus, Roman
currency and its relation to prices was relatively stable. This began to change with the
reign of Nero (54-68 CE) who’s extravagant building programs emptied the treasury. If you
will look at Table 1, you will see that he reduced the weight of the
gold coin, the aureus and the silver denarius as well. The latter suffered a 10%
debasement. The savings in bullion allowed him to make more coins without having more
precious metal. He did the same thing with the provincial coinage of Egypt, recalling the
older coins and re-coining them with a lower silver content. Looking at the chart again,
you can see that under the emperor Trajan (98-117 CE) who’s wars, successful as they were,
did not bring in enough booty to offset their expense, the gold and silver coins again had
their weights lowered and the debasement of the latter grew to 15%. Under the emperor
Marcus Aurelius (161-180 CE), the empire simultaneously faced multiple wars on different
fronts and a plague that probably killed off as large a percentage of the population as the
Black Death did in the Middle Ages. Along with selling off the palace furniture, he caused
the debasement of silver to rise to about 25%. Under Septimius Severus (193-211 CE) the
debasement of the silver grew to nearly 40%.
Table 1. Relative Values of gold and silver
denominations (from Brown).
| Emperor |
Aureus |
Antoninianus |
Denarius |
| av. weight |
av. wt. |
% silver |
Approx. value |
av. wt. |
% silver |
Approx. value |
| Augustus |
7.85 gm. |
‑ |
‑ |
‑ |
3.75 gm. |
99% |
1/25th aureus |
Nero
(post 64 CE) |
7.30 gm. |
- |
- |
‑ |
3.40 gm. |
90% |
1/30th aureus |
Trajan
(post 107 CE) |
7.20 gm. |
- |
- |
- |
3.20 gm. |
85% |
1/35th aureus |
| Caracalla |
6.50 gm. |
5.00 gm. |
50% |
1/30th aureus |
3.00 gm. |
50% |
1/50th aureus |
| Gordian III |
4.85 gm. |
4.30 gm. |
45% |
1/30th aureus |
2.70 gm. |
45% |
1/50th aureus |
| Decius |
4.00 gm. |
3.75 gm. |
40% |
1/30th aureus |
- |
- |
- |
| Gallus |
3.60 gm. |
(i) 3.75 gm. |
40% |
1/30th aureus |
ordinary antoniniani |
| (ii) 3.00 gm. |
50% |
1/30th aureus |
restruck denarii |
| Valerian I |
3.00 gm. |
3.20 gm. |
35% |
1/30th aureus |
|
| The approximate values given for the silver coinage in
terms of its contemporary aureus is computed from the actual silver content and
rounded off to the nearest five. They do not pretend to be exact but then the
information on which they are based is not exact either. |
If you look at Figure 1, you can see
that the aureus, though it retained its purity, fell in weight in a precise relationship
with each adjustment of silver. This was done in this controlled manner in order to
maintain an officially tariffed relationship between the gold and silver coinage: 1-12 I
think. The reason the aureus wasn’t debased like the denarius was because the Roman coinage
was based on a silver standard and gold coins were regarded more as bullion than as money.
Figure 1. Decline of Standards 1st-3rd Centuries
(from Brown).

For the antoninianus and the denarius the actual weight of silver content is shown not
the weight of the coin. |
So why did the Romans pursue this pernicious policy of
debasement? Well at first the problems did not appear so severe. Sure, debasement caused
inflation but it took awhile for the effects to show up. In the short run it was a great
way to get more bang for the buck. The problem was that Imperial budgets never got smaller
and, during emergencies, grew ever larger.
In 235 CE, things really started to hit the fan when the
emperor Severus Alexander was murdered by soldiers incited to mutiny by a general named
Maximinus who then took his place. This was the start of 50 years of near unceasing civil
wars and emergencies. The soldiers of different frontier armies began nominating their own
generals for the throne. It didn’t matter whether the general actually wanted the throne or
not. Once nominated, you had no choice but to try and take it. Otherwise your own troops
would kill you. And if they didn’t, the reigning emperor would. Winning the throne offered
very little security either. Not counting all the unsuccessful usurpers, 30 emperors
reigned during this 50 year period- and of that number, only 2 died in bed.
For the mutinous troops, the rewards were numerous. If you were
victorious, your candidate had to reward you. If you were defeated, then except for your
candidate, the consequences were minimal. The other side still needed as many soldiers as
they could get to beat off the barbarians taking advantage of the chaos to raid Roman
territory, and to fight off the next rival who rose to try for the throne.
In this situation, the treasury and the tax system were wholly
inadequate to meet the demands thrust upon them. The pace of debasement and the inflation
consequent upon it accelerated until finally, in the disastrous reign of Gallienus (253-268
CE), things hit rock bottom and the coinage had become that nearly worthless lump of
copper with the thin veneer of silver on the outside that I showed you earlier. The economy
was shattered as government demand ate up the foundations of production as well as the
surplus. The new, nearly silver-free coins drove the older, more valuable ones from
circulation. Even the provincial coin systems which had remained separate from the Imperial
suffered the same fate and the reign of Gallienus marked the end of the road for most of
them. With the coinage worthless, people and even the government were reduced to bartering
for goods and services.

Antoninianus of Tetricus I
270-73 CE |
Imperial taxes were collected in a haphazard and extremely
unfair manner with the burdens falling heaviest on areas where the army was present. The
flight of the peasantry from their farms which had been a trickle from Nero’s time onward
turned into a flood, with most turning to begging or banditry. Whole districts became
depopulated not only by plague or invasion, but by flight from unpayable tax burdens as
well. The cities suffered too. The middle classes, already under assault by heavy taxation,
suffered the additional disadvantage of being forced to pay those taxes in good silver or
in kind, but obliged to accept the government’s worthless currency for the goods that it
contracted for. The result was their almost total destruction.
City councils, which had been posts of honor earlier, now
became burdens to be avoided as its members were responsible for making up for any
shortfall in the amount of taxes the town was supposed to collect. To prevent avoidance of
this duty, the government made membership on the councils mandatory for citizens who met
the property requirements.
In the wake of plague, invasion, civil war and crushing
taxation, people grew desperate and both the eastern and western portions of the empire
broke away and formed their own governments… and the chaos became general. At the time, I
doubt you could find anyone willing to bet a plug denarius (and by this point all denarii
were plug denarii) that the Empire would last much longer… but it did. The cost was great
and the Empire that emerged from the chaos bore little resemblance to the Rome of old, but
survive it did. 200 years longer in the west and nearly 1,200 years longer in the east. An
incredible accomplishment.
How? How did an empire teetering on the brink of collapse
regain its strength and survive? The men who succeeded Gallienus may have come to power
through mutiny but they tried to serve the Empire as well as they could.1
Aurelian, who ruled from 270-275 CE managed to restore both East and West to Imperial rule
before he was assassinated. He also restored some regularity to the coinage, issuing
radiate coins of a good size and weight, even if the silver content remained almost nil.
His other innovation was to put a mark of value on these coins; either XXI which probably
meant “20 of these are worth one gold piece (aureus)” or, on a smaller coin VSV an
abbreviation for the Latin word “USUALIS” or, the usual value, now thought to be half that
of the XXI coin. What was amazing about this innovation is that these tariff values were
completely unrelated to the bullion content and were backed solely by the faith of the
government which accepted them at the value they were tariffed at. This was the first true
token currency Europe had ever seen. It was the equivalent of what paper money is today.
The reforms of Diocletian (284-305 CE) completed the recovery.
He again tried to issue a new stable gold and silver coinage but, more importantly, he
revised and regularized the tax system with some revolutionary new concepts. First he
conducted a census of the Empire and divided everything into two types of tax units based
on productive capabilities. These were land units called “iugera” and head count or
“capita” (and yes, that’s where our modern term “per capita” comes from).
These were flexible units which took into account the different
productive capacities of various types of land and the different productive capabilities of
men, women, slaves and children. For instance, adult men were each calculated as one capito
or one head count, but it took two women to make up the same amount of head (and I’m going
to bite my tongue before I take a straight line like that any further!) and even larger
numbers of children.
The greatest innovation was the concept of Capitatio.
What this meant was that the state has the right to demand whatever it needs from it’s
citizens in whatever form it wants provided it is done legally and correctly… as follows…
Each year on September 1st, the state’s total requirements were
published and taxes would be apportioned to each province according to it’s assessed
resources. In effect, what Diocletian had created was the modern idea of a national budget
and tax system. Though the burden was undoubtedly heavy, it was at least equally assessed
in all areas.
So efficient was this new system that the money seemed to pour
into government coffers like it hadn’t in memory. No longer did the citizenry suffer the
regular experience of being treated like conquered territory by armed men who were supposed
to be their protectors. People’s iuga and capita were known to them in advance, tax
receipts could prove what they had paid, and appeal could be made if collectors tried to
abuse them.
Unfortunately, the taxes were still collected mainly in kind
(that is, in goods and services) because, despite the new system and coin reforms,
inflation was still rampant. Why was this so? I can tell you that no Roman Emperor had any
idea. Diocletian, in his price-fixing edict of 301 CE, sounds an almost puzzled note as he
blames greedy profiteers for the problem (pg 129). His maximum price edict, despite the
severe penalties it imposed, had little effect on controlling inflation since it failed to
address the actual causes.
Anyone know by now what they were? We covered this before. It
has to do with the relationship between supply and demand. While the government was
collecting vast new amounts of money, it was, at the same time, asking for more goods and
services and the supplies of these were not growing nearly as fast as the government’s need
for them. The result? All those nice new coins the government was churning out could buy
less and less. The Romans never understood this though, in all fairness, they probably
couldn’t have done anything about it even if they did. After all, there is one modern
concept that the Romans did not invent: deficit spending…
So, while the new system initially aided the recovery and
allowed the Empire to last nearly two centuries longer, under Constantine the Great and his
successors, government demand grew ever greater and the tax base shrunk ever further as
certain classes like the Church2 and the more powerful
landowners were given exemptions… and the burdens of the other classes grew to the point
where many fled to these “noblissimi” and put themselves under their feudal protection or
became so despairing of hope that they welcomed barbarian overlords as the lesser of two
evils. As the Empire lost the support of its citizens, its collapse became inevitable. Of
course, that is another story. Thank you.
FOOTNOTES
1 The “soldier emperors” (Aurelian, Diocletian, et al): These
were mostly provincials whose careers were spent entirely on the frontiers. Almost all were
from the wild and mountainous province of Illyria located in the Balkan Peninsula and, at
that time, famous for the quality of the soldiers it produced. Few had ever even seen Rome
before becoming it’s master yet they were Roman to the core. This was the triumph of
Romanization: that people who were barbarous a century and a half earlier so identified
with the Empire that absorbed them that they were willing to fight and die for it’s ideals.
As long as it’s peoples felt this way, the Empire could not fall.
2 At the time of Constantine’s declaration of religious
tolerance, Christians represented perhaps 10% of the Roman population… but they were a very
committed 10%, better organized than any of their pagan rivals and tested in the crucible
of numerous persecutions. Prior to this, they had been regarded as anti-social and
treasonous since they refused to make sacrifice to the Imperial cult which was more a
political than a religious necessity. Constantine saw in them a force that could unify the
people behind the Empire. This was a greater revelation than seeing a cross in the sky and
hearing a voice say “in hoc signo vince eris” (in this sign, conquer). So he
co-opted them and they went from being a revolutionary force to part of the Establishment
(with consequences that would take another lecture to describe).
REFERENCES
Brown, Augustus. (undated booklet) The Financial Collapse
of the Roman Coinage in the 3rd Century A.D. 20 pp. 1 plate. Published by Augustus Brown,
Kyrenia, Kingston, Canterbury, Kent.
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