By the end of the reign of Trajan, in what would later be called AD 117, the impending decline of the Roman Empire could be seen by anyone who looked closely at the coins. In the days of Nero, a half-century before, more than nine parts in ten of a denarius was silver. When Trajan died the ratio was approaching eight in ten, and by the time Septimus Severus gained power in the late second century, it was scarcely more than five in ten.
The Roman state became ever more elaborate, and it incurred ever-mounting administrative, redistributive, and military expenses. Spending less was hard, as was collecting more, so the government on the whole did neither; it just debased the currency. “The inflation that would inevitably follow would tax the future to pay for the present,” writes Joseph Tainter in The Collapse of Complex Societies; “but the future could not protest.”
The United States is $22 trillion in debt. It is set to add another $12.4 trillion over the next ten years. That amounts to a deficit of around $1 trillion a year, or $2.5 billion a day. The country now sustains, as a matter of course, an annual deficit of a size formerly seen only during an economic slump or a major war. It is the de facto policy of the federal government to borrow 20 cents of every dollar it spends. Continue reading “Love Regulation or Hate It, the National Debt Is Not Your Friend”