Yves here. Michael Hudson kindly provided us with an advanced draft of this chapter from his upcoming book, since readers seemed particularly interested in the views of the Greeks on money, commerce, and power. Get a cup of coffee. This post is meaty if you plan to consume it in one sitting.
By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is “and forgive them their debts”: Lending, Foreclosure and Redemption from Bronze Age Finance to the Jubilee Year
Delphi’s warning that lust for monetary silver (philarguria) was the only thing that could destroy Sparta was echoed by Plato, Socrates and other philosophers accusing wealth addiction of leading to greedy and hubristic behavior that impoverished society at large. Creditors were singled out for reducing debtors to bondage and taking their land.
Near the outset of Plato’s Republic (1 at 331c-d, written c. 380 BC), Socrates (who was put to death nearly twenty years earlier, in 399) discusses the morality of repaying debts in circumstances where this would lead to anti-social consequences. Cephalus, a businessman living in the commercial Piraeus district, states the typical ethic that it is fair to pay back what one has borrowed. Socrates asks if it would be just to return weapons to a man who has become a lunatic. If a madman is intent on murder, Socrates asks, will not returning his weapon to him enable him to commit unjust acts? In view of the likely adverse social consequences, paying back such a creditor would be the wrong thing to do. It all depends on what creditors will do with their returns, and how their actions affect society. Book 8 of the Republicelaborates upon this discussion, describing how wealth leads its owners to act in ways detrimental to society.
In contrast to 20th-century price theory assuming diminishing enjoyment or “marginal utility” for each additional unit of a specific consumer good, Greek philosophy saw monetary wealth as being insatiable, becoming more addictive and compulsive. In Aristophanes’ last play, Ploutos(written in 388), the character Karion observes that one may become over-satiated with food – bread, sweets, cakes, figs and barley – but no one ever has enough wealth. His friend Chremelos (the root of whose name is chrema, exchange value and hence money-wealth) observes:
Give a man a sum of thirteen talents,
and all the more he hungers for sixteen.
Give him sixteen, and he must needs have forty,
or life’s not worth living, so he says. (lines 189‑93)
Money-lust and greed are insatiable and infinite. Chremelos says that he loves wealth more than he loves his wife and only son (lines 250f.), but recognizes that: “Our life nowadays can only be described as madness or lunacy. Many wicked men are rich having amassed wealth unjustly, while many others, though scrupulously honest, are poor and hungry” (lines 500‑504).
Quoting from a poem of Solon – “No bound is set on riches for men” – Aristotle (Politics1 at 1256b) described the drive to acquire commercial gains as addictive. As a Roman proverb expressed it: “Money is like sea water: The more you drink, the thirstier you get.” The more money a rich man has, the more driven he is to accumulate yet more, without limit. Ecclesiastes 5:10 says: “Whoever loves money never has money enough; whoever loves wealth is never satisfied with his income.”
Jean‑Pierre Vernant has summarized how Greek dramatists portrayed the greed for money as a disease of the psyche: “Ultimately, wealth has no object but itself. Created to satisfy the needs of life, as a mere means of subsistence, it becomes its own end, a universal, insatiable, boundless craving that nothing will ever be able to assuage. At the root of wealth one therefore discovers a corrupted disposition, a perverse will, a pleonexia– the desire to have more than others, more than one’s share, to have everything. In Greek eyes, ploutos(wealth) was bound up with a kind of disaster.”
To illustrate how wealth addiction warps personal character, Aristotle cited the legend of King Midas of Phrygia. Praying to Dionysus that everything he touched would turn to gold, Midas found that he could not eat without turning his food to gold. “What a ridiculous kind of wealth is that which, even in abundance, will not save you from dying with hunger,” observed Aristotle (Politicsat 1257b).
Wealth Addiction Leads to Destructive Hubris
Idealizing the golden mean, the famous inscription near the entrance of the Delphi temple urged: “Nothing to excess.” The most characteristic excess was addictive money-wealth. A Greek proverb warned that excess (koros) was so addictive that that it ledto pleonexia, the compulsion to obtain more and more wealth. This compulsion led to hubris, an obsessive and arrogant trampling on the rights of others, taking what rightfully belongs to them. Socrates suggests that the unjust person “will strive to get the most he can for himself and from everyone.”
Nick Fisher traces the development of this idea: “In Hesiod, hybris is used repeatedly as a contrary of dikē[“justice”], to indicate behavior that is variously violent, criminal and anti-social,” most notoriously among rich “fools blessed with fortune.”For Homer, hybris “is a major crime, endangering the cohesion of the community,” as well as the individual’s personal psyche. The tendency of money-wealth to become predatory and socially corrosive is what led Zeus and the other gods “to punish hybris, and uphold dikē andeunomia,” good order and laws.
Aristotle contrasted the pleasure of hubristic acts with the social instinct for reciprocity. It is “that of making others feel one’s superiority by hurting or insulting them, and it is more likely to occur among those blessed by the gods of fortune (while lacking moral virtue), or those sure that they will be safe from unpleasant consequences; the rich and the young were specifically mentioned in the definition as typically hybristai, and the connection with the idea of koros or too much good fortune is not far away.”Suchhubris thus was a problem that plagued the rich.
Recognizing that “poverty produces faction and crime” (Politics 2.6 at 1265b), Aristotle concluded: “the duty of a true democrat is to see that the population is not destitute” (6 at 1320a). Democracy would be corrupted if creditors and others amassed wealth by impoverishing their fellow citizens. Men commit the most serious crimes because “their aims are extravagant, not just to provide themselves with necessities. Who ever heard of a man making himself a dictator in order to keep warm?” (Politics 2.7 at 1267a)
Socrates (Republic 4 at 421d) suggests that wealth is as destructive as the poverty it causes. “Will a potter who’s gotten rich still be willing to attend to his art? And will he become idler and more careless? Doesn’t he become a worse potter then? And further, if from poverty he’s not even able to provide himself with tools or anything else for his art, he’ll produce shoddier works … Then from both poverty and wealth, the products of the arts are worse and men themselves are worse.”
Aristotle and subsequent Stoics advocated that rulers should prevent poverty by ensuring that citizens had enough land to be self-sustaining. This could not be achieved where citizens fell deeply into debt and land holdings were widely unequal. But that was the reality of classical Greek society, despite the principles of balance and moderation underlying most of its moral philosophy.
The Hubris of Wealth Addiction vs. the Morality of Moderation
The concept of balance permeated the Greek world-view. The philosophy of medicine, for instance, sought to prevent disease by keeping the body’s four humors in balance so as not to let any part gain at the expense of the others. The social analogy was to limit appetites, avoid ostentatious luxury and refrain from abuses of power. The fundamental Greek democratic moral principle regarding wealth was that public officials should protect the polis and its citizens from too great a concentration of wealth as well as against poverty. The guiding mottos were “Neither too much nor too little,” and “Avoid and hate all mean advantage, and seek for equality.”
In Athenian drama the common tragic flaw was over-reaching, leading to punishment by Zeus, Nemesis or other deities. Aeschylus’s chorus in Agamemnon (458 BC) warns that “the swarthy Furies stalk the man gone rich beyond all rights.”Most tribal cultures studied by anthropologists constrain the egotism of chiefs and other powerful individuals. The typical ethic is to “pound down the nail that stands up too high,” sometimes called the “tall poppy syndrome.” Periander of Corinth advised (or was advised) to cut down the tall poppies among his city’s most affluent families.
The Stoic ethic held that citizens should conduct themselves like well‑behaved guests at a group meal, with self‑restraint and a concern for the welfare of their companions. But rising prosperity undermined this traditional symbolic equality of portions. In On Drunkenness, Chamaeleon of Heracleia (c. 350-275 BC) wrote: “If those who enjoy power and wealth esteem this devotion to drunkenness above everything else, it is not to be wondered at” that they demand ever larger wine cups. “This is why the larger forms of drinking‑cups grew to be the fashion among the persons in power. But this … is a recent invention, imported from the barbarians.”
In a similar vein Plutarch’s Table Talk (2.10 at 644) later observed: “The custom of distributing portions of the meat was abandoned when dinners became extravagant; for it was not possible, I suppose, to divide fancy cakes and Lydian puddings and rich sauces and all sorts of other dishes made of ground and grated delicacies; these luxurious dainties got the better of men and the custom of an equal share for all was abandoned.”
The logic of sumptuary legislation against luxury was based on the belief that drinking and feasting without constraint tended to corrupt. A typical image of wealth addiction was to be drunk with wealth, seeking to amass as much land and money as possible, without regard for the social consequences.
Interest Rates, Birth Metaphors and the Injustice of Charging Interest
Aristophanes’ Clouds (first staged in 423) opens with Strepsiades unable to pay the debts that his son has run up. He laments “that day which more than all the rest I loathe and shrink from and abominate … that hateful Old‑and‑New day” on which his debt payments will accrue, but without him having earned the means to pay.To extricate himself from having to pay, he urges his son to attend Socrates’ school, the Thinkery, to be taught rhetorical tactics and “unjust speech” to beat his creditors by making the weaker and less just argument appear stronger.
Strepsiades (attending the Thinkery himself) asks one of his creditors from what source debts are to be paid. “How is it just that you recover your money, if you know nothing of meteorological matters? Money can no more increase from day to day than the sea can increase its size from the influx of rivers” (lines 1283-1295), assuming the sea’s volume of water to be constant. So where were interest payments to come from?
When Scholastic Canon law banned interest charges in the 13thcentury, the most important text was Aristotle’s Politics (1.10 at 1256, written c. 350): “The taking of interest is contrary to nature because money by nature cannot produce anything and is intended only to serve the purpose of exchange.” Cattle give birth to calves, but inasmuch as money is “barren metal,” it is unfair for creditors to charge interest as if it were animate and productive by itself.
From Bronze Age Mesopotamia through classical Greece and Rome, the words for interest signified an offspring, such as a newborn goat (mashin Sumerian) or calf (tokosin Greek). The prefix fe‑in Latin fenusconnotes the birth-related ideas of female (originally “to suckle”), fecundity and fertility. All these words depicted the generation of interest as the birth of an offspring. Yet usury typically was personified as sodomy, or at best, a sterile old man, as in the story of how Rome’s Poetelia Papiria law against usury came to be passed after a creditor abused a young boy pledged to his household for debt (see Chapter 12). This sexual metaphor of homosexuality and the inability to procreate survived into medieval Europe. In 1306, Philip the Fair accused the Knights Templar of buggary as an excuse to seize the wealth of their Paris Temple.
The widespread dislike of interest, Aristotle explained (Politics1.8-9 at 12156b-1258b), “is fully justified, for the gain arises out of the currency itself, not as a product of that for which currency was provided. Coinage was intended to be a means of exchange, whereas interest represents an increase in the currency itself.” That seemed to be as unnatural as Strepsiades’ analogy of the sea being unable to expand its size. “Hence its name, tokos (‘offspring’), for each animal produces its like, and interest is currency born of currency. And so of all types of business this is the most contrary to nature.”
What really was “born” in the case of monetary credit in antiquity was the local society’s unit-fraction after a specified period of time, typically a lunar month ending with the new moon, the date on which Greek debt service, for instance, was owed. The idea goes back to Mesopotamia, where a shekel (1/60thof a mina) accrued or was “born” of each mina every month.The moon traditionally was associated with silver, antiquity’s main money of account. A “baby” unit (1 shekel per mina) of silver-interest accrued (was “born”) when the crescent moon, patron deity of silver, was born, so the principal doubled in 60 months (five years).
The exponential growth of money lent out at interest was seen to be especially extractive, compounding without limit. It was along this line that Socrates criticized the wealthy. They “insert their sting – that is, their money – into someone else who is not on his guard against them, and recover the parent sum many times over multiplied into a family of children.”
The Contrast Between Money Value and Use Value
Money lent out at interest was different from tangible capital in the form of means of production. The root meaning of “capital” is “head” (from Latin caput), as in a head of cattle yielding calves. Tools and other forms of capital were means to make things, while money’s proper function was to serve as a means of payment, to facilitate market exchange for families that did not produce their own food and other necessities. Aristotle extended his contrast between productive capital and money by juxtaposing household management (oikonomos), based on use values, against the commercial acquisition of money-wealth (chrematistike).
“Natural” economies were supposed to maintain an equitable balance among their households based on use values. To obtain wealth simply through mercantile exchange value (chrema), amassing monetary gain as an objective in and for itself, was “unnatural,” because it “is not productive of goods … the end is sheer increase” for its own sake. Creditors reduce large numbers of citizens to debt bondage, becoming rich by driving their debtors into poverty and stripping away their means of self-support.
The Destructively Selfish Oligarchic Rentier Ethic
While admonishing the aim of purely monetary gain (the taking of interest) as unnatural, Aristotle recognized the reality of wealth addiction (pleonexia) and hubris, which he saw as plaguing mainly the landed gentry living on rents and interest paid out of other people’s effort and product. His view reflected classical antiquity’s aristocratic aversion to getting one’s own hands dirty. Making money by one’s own enterprise or usury was considered to be so degrading that estates were left to slaves or metics to manage, increasing the wealth of their owners by turning citizens into clients and retainers, appropriating their land, and hence eroding the state’s power to defend itself. This is how Rome’s leading historians – Livy, Diodorus, Dionysius of Halicarnassus, Plutarch and Sallust – described creditors as undermining the Republic.
Aristophanes ’Ecclesiazusae (Assemblywomen), written in 391 BC, depicts women taking control of the government to ban private wealth and promote equal pay and similar equality, claiming that after all, they do most of the work. The character Blepyros expresses the hope that theft will disappear once citizens are provided with life’s necessities and the means of self-support.
But a Wealthy Man appears and urges that the new laws be ignored. Attending a feast at which the invitees are expected to contribute food, he brings nothing, and tries to persuade others to adopt his anti-social attitude. The play proceeds to describe how the oligarchic character flaw of wealth addiction undermines this utopian ideal to prevent poverty from being eradicated. “Prosperity did not actually stop the wealthy from stealing more and more; on the contrary, they proved to be the biggest thieves,”paraphrases one commentator. Therefore, “preventing highway robbery by removing the problems of hunger and cold, cannot … be a panacea for social ills,”as long as the tendency for money-wealth to be addictive and socially destructive remains.
Characterizing Protectors of Debtors as “Tyrants”
The seemingly reasonable advice of Aeschylus: “Not a life of anarchy nor the rule of tyranny: take the middle way endowed by gods” (Eumenideslines 696-99, 458 BC) meant in practice leaving the wealthy with their privileges and power. The “middle way” always meant “don’t give democracy too much.” Despite criticizing the destructive behavior of creditors, Plato and Aristotle considered debt cancellation and land redistribution to be the program of tyrants seeking power by pandering to the intemperate mobocracy (ochlocracy) of the poor, ending up falling subject to the same hubris as the wealth-addicted rich. Deeming the poor the “worst classes” (kakoi), Plato had Socrates say that: “Wherever you see beggars in a city, there are somewhere concealed thieves and cut-purses and temple robbers and similar experts in crime” (Republic 8at552d).
Aristotle followed suit, writing that citizenship should be limited to the well-to-do leisure class, excluding craftsmen, most of whom were metics or freedmen.He endorsed Solon’s Athenian constitution prescribing that the leading lawmakers must be chosen from among the wealthiest landowners, assuming that their interest would lie in preserving a prosperous and well-balanced body politick.
The problem was that productivity was not yet sufficiently advanced to support all citizens in the comfort and leisure necessary to enable them to participate in the time-consuming military practice, not to mention management of public affairs. “Therefore Aristotle says, very justly … that the man who had to labor in order to live could not be a citizen.” That is why Spartans left the mean or mechanical trades to the periokoi. “The helots tilled their ground for them, and paid them yearly in kind the appointed quantity.”
Creditor oligarchies from Athens and Sparta to Rome blocked public policies aiming to save society at large from being injured by debt and land monopolization. Students of Plato and Aristotle belonged to this rentierclass, whose world-view these philosophers characterized as one of wealth addiction and hubris.
Socrates Debates How Wealth Corrupts Politics
Book 1 of Plato’s Republic centers on a debate between Socrates and Thrasymachus about how the strong rule over the weaker. Their discussion poses the most important question for Western civilization. As long as rulers are drawn from the class of large landholders and creditors, aspiring to monopolize economic gains for themselves and their class at the expense of the citizens they govern, how can they be prevented from abusing their control of government to impoverish and ultimately depopulate society?
Socrates’ ideal is for legislators to be like good craftsmen. Just as doctors or sea captains seek the well-being of their patients or crew and passengers, public officials are supposed to promote the welfare of society as a whole. Thrasymachus replies that:
injustice, on a grand enough scale, is superior to justice in strength and freedom and autocratic power; and ‘right’ … means simply what serves the interest of the stronger party. … in every case the laws are made by the ruling party in its own interest; a democracy makes democratic laws, a despot autocratic ones, and so on. By making these laws they define as ‘right’ for their subjects whatever is for their own interest, and they call anyone who breaks them a ‘wrongdoer’ and punish him accordingly
Socrates defends his ideal:
The physician, as such, studies only the patient’s interest, not his own. … the business of the physician, in the strict sense, is not to make money for himself, but to exercise his power [to heal] the patient’s body. The ship’s captain, again considered strictly as no mere sailor but in command of the crew, will study and enjoin the interest of his subordinates, not his own. … And so with government of any kind: no ruler, in so far as he is acting as ruler, will study or enjoin what is for his own interest. All that he says and does will be said and done with a view to what is good and proper for the subject for whom he practices his art
But this ideal is turned upside down in practice, Thrasymachus replies:
You imagine that a herdsman studies the interests of his flocks or cattle, tending and fattening them up with some other end in view than his master’s profit or his own. So you don’t see that in politics, the genuine ruler regards his subjects exactly like sheep, and thinks of nothing else, night and day, but the good he can get out of them for himself.
The reality, he says (1 at 343a-d), is that “to be ‘just’ means serving the interest of the stronger who rules, at the cost of the subject who obeys … asserting its authority over those innocents who are called just” and acting in ways that add to their master’s income and wealth, not their own. “A just man always has the worst of it. Take a private business: when a partnership is wound up, you will never find that the more honest of two partners comes off with the larger share.” It is the same with public officials: Dishonest administrators enrich themselves at society’s expense. So the unjust become happier than the just. A political system s run by the strongest and richest, Thrasymachus says,
rewards wrongdoing with supreme welfare and happiness and reduces its victims, if they won’t retaliate in kind, to misery. That form is despotism, which uses force or fraud to plunder the goods of others, public or private, sacred or profane, and to do it in a wholesale way. If you are caught committing any one of these crimes on a small scale, you are punished and disgraced. They call it sacrilege, kidnapping, burglary, theft and brigandage. But if, besides taking their property, you turn all your countrymen into slaves … your countrymen will call you the happiest of men and bless your name, and so will everyone who hears of such a complete triumph of injustice. (1 at 344a-c)
Socrates Accuses Democracy of Leading to Tyranny, as if There Were No Alternative
Book 8 of the Republic is basically a lecture by Socrates about how oligarchy gives way temporarily to democracy, which must end in tyranny and a new oligarchy. Describing democratic reformers as proto-tyrants, Socrates outlines a cyclical view of political stages, with each stage decaying as the class in power acts selfishly and succumbs to hubris(Republic 8 at 555n-556a) with the debt issue primarily responsible for the shift from oligarchy (rule by the wealthy few) to tyranny (8 at 566a and 573e).
Socrates starts by explaining how oligarchy arises out of the aristocracy consolidating its political control by establishing a property qualification for office, and using force and the threat of terror to prevent laws being enacted to limit their power and money-lust. The result of such an oligarchy is to bifurcate society into two classes, rich and poor, “always conspiring against each other.”
The rich fear to incorporate poorer citizens in the army, because:
the poor man, lean and sunburnt, may find himself posted in battle beside one who, thanks to his wealth and indoor life, is panting under his burden of fat and showing every mark of distress. ‘Such men,’ he will think, ‘are rich because we are cowards’; and when he and his friends meet in private, the word will go round: ‘These men are no good: they are at our mercy.’ (8 at 556e).
In addition, Socrates elaborates, “their fondness for money makes the wealthy unwilling to pay taxes.” They take land from the less affluent, whom they reduce to a pauperized class, “neither trader, nor artisan, nor horseman, nor hoplite, but only poor, helpless creatures. … the drone and pauper element in the state.” The ruling class even devours its own members, foreclosing on their land and disenfranchising them. Spendthrift youth lose their estates to creditors whowalk around “pretending not even to see those whom they have already ruined.”
To avert this “negligence and encouragement of licentiousness in oligarchies” by creditors inserting the parasitic “sting of their money into any of the remainder who do not resist” (8 at 555d-556b), Socrates suggests a law “commanding that most voluntary contracts should be at the contractor’s risk.” That would oblige creditors to share in the risk of non-payment. Debtors who could not pay would have their debts forgiven, as creditors would bear the risk of the debtor’s inability to pay.
That was as close as Socrates got to picking up the point he had made in Book 1: that it would be wrong to pay debts to creditors who would use the money in destructive ways, e.g., reducing the citizenry to debt dependency and stripping away their land.
Mercantile lending to shippers accepted the basic principle of creditors sharing in the risk of the debtor’s inability to pay. From Mesopotamia to Greece and Rome, creditors lost when a ship sank. That made trade financing basically a form of maritime insurance. (Chapter 13 describes the frauds that Roman shippers developed to abuse this principle.) But such risk sharing was not extended to agricultural credit. Foreclosure provided too appealing an opportunity for creditors to obtain the land and labor of their debtors, and no popular demand was made for Socrates’ anticipation of modern bankruptcy law (i.e., creditors sharing in the risk of non-payment).
As Socrates warned, that left the people (demos) to “conspire against the acquirers of their estates and the rest of the citizens, and be eager for revolution.” Not expecting Greek ruling elites to enact his proposals, he outlined the dynamic that Aristotle picked up in Book 5 of Politics: Aristocrats would promote democracy by “taking the multitude into their camp.” Younger members of the ruling oligarchy, or those from less affluent branches who had run into debt, would lead a revolution.
However, Socrates warned, a democratic city was one in which “a thirst for liberty gets bad cupbearers for its leaders and is intoxicated by drinking too deep of that unmixed wine,” a frequent metaphor for the “immoderate” policies of cancelling debts and redistributing land. Expressing his contempt for democracy’s “anarchic temper,” he concluded: “The climax of popular liberty is when the slave bought with money,male or female, is just as free as his or her purchaser; nor must I forget to tell of the liberty and equality of the two sexes in relation to each other” (Republic8 at 562a-568a).
Socrates thus shared the prejudice of his Athenian students and friends in characterizing advocates of canceling debts or limiting landholdings as incipient tyrants. Leaders claiming to be “protector of the people” would pander to the intemperate tastes of democratic mobs and become hubristic, succumbing to luxurious feasting, drinking and “insatiate lust for wealth and the neglect of everything else for the sake of money-making.” The ensuing freedom would lead to tyranny, because the poor are too impatient to elect moderate public servants. The tyrant would consolidate his power by persecuting his opponents. “Some he kills and others he banishes, at the same time hinting at the abolition of debts and partition of lands … At first, in the early days of his power, he is full of smiles … liberating debtors, and distributing land to the people and his followers. … But when he has disposed of foreign enemies by conquest or treaty and there is nothing to fear from them, then he is always stirring up some war or other in order that the people may require a leader.”
Blaming wealth addiction for the “sting” of creditors, Socrates focused on defects in personal character as the underlying explanation for bad economic relations.
Socrates Proposes a New Ruling Class in his Own Image, Without Money or Land
The excesses that Socrates saw among the richest Athenians seem to have led him to renounce wealth-seeking. Plato’s Apologyreports that at his trial Socrates stated that he considered money-making and property a waste his time, diverting him from being useful. He did not accept payment from his students, expressing disdain for the Sophists’ practice of charging heavy fees. As he explained (Xenophon, Memorabilia of Socrates 1.13): “It is common opinion among us in regard to beauty and wisdom that there is an honorable and a shameful way of bestowing them. For to offer one’s beauty for money to all comers is called prostitution. … So is it with wisdom. Those who offer it to all comers for money are known as sophists, prostitutors of wisdom.”
Aristophanes (Clouds, lines 103-104) characterizes Socrates as a “barefoot vagabond” and Plato’s Phaedrus(229) likewise describes him is always going about barefoot. Xenophon (Memorabilia 1.2-5 and 1.10) records the prosperous Antiphon as bewildered by the fact that Socrates’s “meat and drink are of the poorest: the cloak you wear is not only a poor thing, but is never changed summer or winter; and you never wear shoes or tunic. Besides you refuse to take money, the mere getting of which is a joy, while its possession makes one more independent and happier.”
Socrates replies that, “because I refuse to take it, I am not obliged to talk with anyone against my will.” He concludes: “You seem, Antiphon, to imagine that happiness consists in luxury and extravagance. But my belief is that to have no wants is divine; to have as few as possible comes next to the divine.” Socrates explains that he is rich (ploutein) in real wealth, which he defines as satisfaction with what he has.
Socrates explains that wealthy people therefore are “poor” because their wealth addiction makes them feel hungry for more as money becomes an end in itself instead of simply serving its “natural” function to facilitate exchange. He describes his extravagant friend Critobulus as actually being poorer, if one defines wealth as satisfaction with what one has.
Socrates: I certainly think I have no need of more money and am rich enough. But you seem to me to be quite poor, Critobulus, and at times, I assure you, I feel quite sorry for you.
Critobulus (laughing): And how much, pray, would your property fetch at a sale, do you suppose, Socrates, and how much would mine?
Socrates: Well, if I found a good buyer, I think the whole of my goods and chattels, including the house, might readily sell for five minae [about $100]. Yours, I feel sure, would fetch more than a hundred times that sum.
Critobulus: And in spite of that estimate, you really think you have no need of money and pity me for my poverty?
Socrates: Yes, because my property is sufficient to satisfy my wants, but I don’t think you would have enough to keep up the style you are living in and to support your reputation, even if your fortune were three times what it is.
Considering money-love to be the lowest part of the soul (Republic 9.581c-d), Socrates contrasts the form of pleasure characterized by lovers of economic gain to that of lovers of wisdom (philosophers) or of military victory: “The financier will affirm that in comparison with profit, the pleasures of honor or of learning are of no value except in so far as they produce money.” But philosophers and public-spirited men “regard the pleasure that comes from money as vulgar and low … [for] the lover of gain is under no necessity of tasting or experiencing the sweetness of the pleasure of learning the true natures of things.”
Socrates elaborated his own self-imposed poverty into the political ideal of a ruling class of Guardians who would live like him, rejecting wealth. To keep them immune from being sucked into the vortex of wealth addiction that he blamed for enactment of unfair and unjust laws, he proposed that they be banned from having gold or silver coinage or ornaments. “In the first place, none must possess any private property save for the indispensable … Secondly, none must have any habitation or treasure house that is not open for all to enter at will” (Republic3 at 416d).
To compensate for their not being allowed to own substantial property or money, Socrates recommended that these “philosopher-kings” would “receive an agreed stipend from the other citizens as the wages of their guardianship, so measured that there shall be neither superfluity at the end of the year nor any lack.” Their food would be like Sparta’s syssitia meals, “a common mess like soldiers on campaign … in such quantities as are needful for athletes of war , sober and brave.”
Plato’s Laws(5.736c-737a) adopts this emphasis on personal abstinence.The main foundation of the security of a State “consists in renouncing avarice by the aid of justice.” Specifically, a “rule of moderation” was to be based on the principle “that poverty consists, not in decreasing one’s substance, but in increasing one’s greed.”
Just as we said that the colony of the Heraclidae was fortunate in avoiding fierce and dangerous strife concerning the distribution of land and money and the cancelling of debts (so we are similarly lucky); for when a State is obliged to settle such strife by law, … no way is left save what one might term that of “pious aspiration” and cautious change, little by little, extended over a long period. … there must already exist a supply of men to effect the change, who themselves, on each occasion, possess abundance of land and have many persons in their debt, and who are kind enough to wish to give a share of these things to those of them who are in want, partly by remissions and partly by distributions.
Still, realizing the political limits to which his students and audience would accept, he and Plato limited their discussion to the basic idea that wealth addiction led to dysfunctional public policy. This was accepted as the “political correctness” of their day. Describing himself as a gadfly, giving a “sting” once and a while to spur philosophical discussion, Socrates’s perspective was that of a critical outsider but not one who proposed concrete reforms threatening the status quo. After proposing to elevate the personal character of rulers and warning that usury and money-love injured society, Socrates stopped short of limit their current abuses. Although Socrates and Plato had many good things to say about Sparta’s “Lycurgan” policies, to have anticipated the reforms of Agis IV and Cleomenes III in Sparta in the late 3rdcentury BC (described in the next chapter) would have seemed so abhorrent to most well-to-do Athenians that they would have been dismissed as extremists. But the ideal of a ruling class without property and money of its own was so unrealistic as to be a harmless threat to the status quo. Throughout the Greek and Roman world every city-state’s regime was in the hands of the largest landholders and creditors, whose oligarchies were anything but moderate and showed themselves unwilling to relinquish wealth and power.
To be sure, Athens was less immoderate than other city-states. Moritz Hinsch points out that debt crises “were most absent from the very region where money, credit and enforceability were most entrenched.” Despite the emphasis that Plato, Aristotle and Aristophanes placed on debt as the main force disrupting economic balance, the 4th-century Athenian democracy voted against the policy of cancelling debts, even those that The Thirty had run up during the oligarchy’s brutal eight months in power. The pseudo-Aristotelian Constitution of Athens (60.2-3) points out that when democracy was restored, the new regime “did not even make a redistribution of the land,” a typical policy of democracies overthrowing oligarchies.
The explanation for such moderation is that Athens used its public revenue to subsidize its poorer citizens. Public employment provided a source of income for the needy, while temples advanced emergency loans. It was in the most rural and least commercialized parts of Greece that debt revolts broke out, from Sparta to Argos and the Corinthian Isthmus in the 3rdand 2ndcenturies.
By blaming populist leaders for bad policies, Socrates missed the point made in modern times with regard to Rome’s Social War (133-27 BC). As Peter Brunt has noted: “Perhaps no populares, at least after the Gracchi, were sincere; perhaps all sought only to satisfy their ambition or that of their leader. But again, their personal motives, which it may be hard to determine, are less significant than the real grievances and genuine discontents on which they could play.” This recognition of the grievances felt by ordinary citizens is lacking in the discussion of Socrates and Plato. Like most of their leading contemporaries, they show a contempt for those who must work for a living. To the rentier class, the “demos” did not mean all citizens (“all native males, irrespective of class”), but just the lower classes, a distinction only “drawn by critics or opponents of democracy, not by democrats themselves.”
Socrates let himself be condemned to death by Athenians who resented the fact that his students and adherents at Plato’s academy were wealthy aristocrats, including members of the pro-Spartan oligarchy of the Thirty, especially Critias (first cousin of Plato) and Charmides (Plato’s uncle), who led the dominant aristocratic faction. He did not protest that these aristocrats were anything but the kind of guardians he advocated. They were in fact just like his critic Thrasymachus accused at the outset of the Republic, using power to support their own narrow self-interest.
The economically destructive rule of oligarchies became increasingly evident as Greece and Rome succumbed to debt crises and military confrontation against democracies from the 4thcentury BC onward. When Sparta’s kings finally sought to cancel debts, Greek oligarchies called on Rome to defeat the effort – and Rome went on to destroy Greece and Macedonia and turn them into subject tribute-paying provinces.
Fisher 1992:19 citing Aristotle, Rhetoric2 at 1383a1-3: Individuals “who feel they have nothing left to be afraid of … are hybristai, contemptuous (oligoroi) and bold – and it is wealth, strength, having many friends, or power which makes them like that.” For a discussion of how the pseudo-AristotelianConstitution of Athens5.2f. criticized the hubris of the wealthy, see Nagy 1985: 43.
The chorus continues: “with a twist of fortune grind him down, dissolve him into the blurring dead; there is no help. The reach for power can recoil, the bolt of god can strike you at a glance.” Plato and Aristotle describe this downfall as being the fate of entire political systems, from oligarchy to democracy.
Murray 1990: 139, notes that “Solon connects the hubris of the wealthy with their feasting: ‘they know not how to restrain their koros or to order their present euphrosunai[the delights of the symposion]in the quiet of the feast’ (Fragment 4.9-10 West).” He adds (p. 142): the whole of Demosthenes 21 is built around the typical relationship between wealth and hubristic behavior.
Lowry1987: 230ff. notes: “The whole profit-motivated market process which we now call the ‘economy’ was regarded by Aristotle as chrematisticsand external to his oikonomia. Hispolitical economy was directed to an analysis of the management and satisfaction of the needs of the household and state and not to the study of a market oriented toward profit maximization.” Modern economics shields its eyes from the predatory behavior of wealth. It views the profit motive as leading to economic equilibrium, not destabilizing society as a result of wealth addiction.
Ecclesiazusae, lines 608 and 667f., cited in David1984: 12. Elsewhere in the play, Praxagora asks, “Where did the lender get the money from in the first place, … Obviously, he’s a thief!” Available at http://www.poetryintranslation.com/PITBR/Greek/WomenInParlia, translated by G. Theodoritis.
Sagstetter 2013: 64 points out that Plato “claimed that ‘work’ crushed souls and deformed bodies (Republic495d-e).” Aristotle (Politics6 at 1328b-1329a) wrote: “The citizen must not lead the life of mechanics or tradesman, for such a life is ignoble and an enemy of virtue. Neither must they be farmers, since leisure is necessary both for the development of virtue and the performance of political duties.”
Duplouy and Brock 2018 point out that Aristotle (Politics3 at 1279a-b) said that although well-run states were those that had the welfare of their citizens at heart, rulers tended to act in their own interest. “The correct (orthai) forms of government are those which have the welfare of the governed at heart, whereas those who aim only at the rulers’ good are ‘deviations’ (parekbaseis).”Rentieroligarchies were inherently self-centered and exploitative. Were they “deviations,” or the norm?
Henry Fielding drew the same moral in the first full-length English-language novel, The History of the Adventures of Joseph Andrews and of his Friend Mr. Abraham Adams(1742): “Nobody scarce doth any good, yet they all agree in praising those who do. … All rail at wickedness, and all are as eager to be what they abuse.”
Pseudo-Demosthenes 17.15 (c. 336 BC) mentions debt cancellation, confiscations of property, land distribution and liberation of slaves as the typical revolutionary program threatening Greek oligarchies. Cited in Cecchet 2017: 131.
Oeconomicus(2.2-4), available at https://pages.ucsd.edu/~dkjordan/arch/greeks/XenophonOeconomicus.html, transl. by R. C. Marchant (1929).
Plato disdained charging interest and usury, and that interest-free eranosdebts among friends could not be subject to lawsuits (Laws5.742c) and urged minimizing the role of money, as Sparta did. But he did not deal with the macroeconomic dynamics of debt. He only endorsed interest charges as penalty fees on broken civic contracts with craftsmen, “one obol on each drachma for every month of arrears; and actions for these cases shall take place before the tribal courts” (Laws, 11.921.b-d).
Fisher 1992: 69 and 127 cites an Athenian statue of “Oligarchy setting fire to Democracy” commemorating the democrats who overthrew Critias, leader of the Thirty [oligarchic] Tyrants in 403. On its base is inscribed an epigram: “This is the memorial of those good men who for a brief time restrained the accursed demos of the Athenians from hybris.”