Series 9
27
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.
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.
Ancient Egypt
In 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.
Work like an
Egyptian:
Statue of
a slave
Split society:
A 14th century
illustration of a
medieval harvest
Feudalism
Feudalism 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.
Middle-ages feudal tenure
From each according to his ability,
to each according
to his need
Socialism
THE KING
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 CHURCH
BARONS
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 undertenants. The under-tenants
promised to supply
soldiers when the king
needed them.
Socialism 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:
Karl Marx, 1875
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.
Russian Soviet Communism
The 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.
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.
The 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.
Under-tenants worked for barons and church
leaders, who granted peasants land. Peasants
provided rent, tax and/or labour services.
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.
German National Socialism
The lords fought, the
clergy prayed, and the
peasants worked
Rondo Cameron in A Concise Economic
History Of The World (Oxford)
In return for land,
serfs provided
labour, free
peasants paid rent.
Slave economies
In 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
Auction: 1700s slave market
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. Harsh: Loading a slave ship
Visit our website at www.news.com.au/dailytelegraph/classmate
The 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.
PEASANTS
Capitalism
The 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).
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.
Chinese Communism
UNDER-TENANTS
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.
Influential: Karl Marx (top),
Soviet dictator Stalin (centre), Nazi
posters and statue of Chairman Mao
Wealthiest people in history
In 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).
Contact Classmate at [email protected] or phone 9288 2542
Cl@ssmate
Find out more
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.php
Ancient Egyptian Economy
reshafim.org.il/ad/egypt/economy/
index.html
The Ascent Of Money (BBC DVD)
Encyclopaedia Britannica
Editor: Troy Lennon
Graphics: Paul Leigh and Will Pearce
EVERY TUESDAY