remote regions were displaying disloyalty, the treasury was empty, agriculture depressed, and trade almost at a standstill. It was then that Diocletian issued his famous price-fixing proclamation as the last measure of a desperate emperor. We are struck by the similarity to such proclamations in our own time. Most of the chaos can be traced directly to government policy. Yet, the politicians point the accusing finger at everyone else for their "greed" arid
"disregard for the common good." Diocletian declared:
French translation from the Geneva text by Jules Nicole, p. 38. Cited by Groseclose.
2. Byzantininsche Kulturgeschichte (Tubingen, 1909), p. 78. As quoted by Groseclose,
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Who is of so hardened a heart and so untouched by a feeling of humanity that he can be unaware, nay that he has not noticed, that in the sale of wares which are exchanged in the market, or dealt with in the daily business of the cities, an exorbitant tendency in prices has spread to such an extent that the unbridled desire of plundering is held in check neither by abundance nor by seasons of plenty....
Inasmuch as there is seen only a mad desire without control, to pay no heed to the needs of the many,...it seems good to us, as we look into the future, to us who are the fathers of the people, that justice intervene to settle matters impartially.1
What followed was an incredibly detailed list of mandated prices for everything from a serving of beer or a bunch of watercress to a lawyer's fee and a bar of gold. The result?
Conditions became even worse, and the royal decree was rescinded five years later.
The Roman Empire never recovered from the crisis. By the
fourth century, all coins were weighed, and the economy was slipping back into barter again. By the seventh century, the weights themselves had been so frequently changed that it was no longer possible to effect an exchange in money at all. For all practical purposes, money became extinct, and the Roman Empire was no more.
RECEIPT MONEY
When new civilizations rose from the ruins of Rome, they
reclaimed the lost discovery of money and used it to great advantage. The invention was truly a giant step forward for mankind, but there were many problems yet to be solved and much experimentation lay ahead. The development of paper
money was a case in point. When a man accumulated more coins than he required for daily purchases, he needed a safe place to store them. The goldsmiths, who handled large amounts of precious metals in their trades, had already built sturdy vaults to protect their own inventory, so it was natural for them to offer vault space 0 their customers for a fee. The goldsmith could be trusted to guard the coins well because he also would be guarding his own Wealth.
When the coins were placed into the vault, the warehouseman would give the owner a written receipt which entitled him to 1 As quoted by Groseclose,
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THE CREATURE FROM JEKYLL ISLAND
withdraw at any time. At first, the only way the coins could be taken from the vault was for the owner to personally present the receipt. Eventually, however, it became customary for the owner to merely endorse his receipt to a third party who, upon presentation, could make the withdrawal. These endorsed receipts were the forerunners of today's checks.
The final stage in this development was the custom of issuing, not just one receipt for the entire deposit, but a series of smaller receipts, adding up to the same total, and each having printed across the top: PAY TO THE BEARER ON DEMAND. As the population learned from experience that these paper receipts were truly backed by good coin in the goldsmith's warehouse and that the coin really would be given out in exchange for the receipts, it became increasingly common to use the paper instead of the coin.
Thus,
NATURAL LAW NO. 2
