Henry Hazlitt is well-known to FREEMAN readers as author, columnist, editor, lecturer, and practitioner of freedom. This article will appear as a chapter in a forthcoming book, The Conquest of Poverty, to be published by Arlington House.
Instances of government relief to the poor can be found from the earliest times. Though the records are vague in important particulars, we do know a good deal about what happened in ancient Rome. A study of that case may enable us to draw a few lessons for our own day.
Roman "social reform" appears to have begun in the period of the Republic, under the rule of the Gracchi. Tiberius Gracchus (c. 163-133 B.C.) brought forward an agrarian law providing that no person should own more than 500 jugera of land (about 300 acres), except the father of two sons, who might hold an additional 250 jugera for each. At about the same time that this bill was passed, Attalus III of Pergamum bequeathed his kingdom and all his property to the Roman people. On the proposal of Gracchus, part of this legacy was divided among the poor, to help them buy farm implements and the like. The new agrarian law was popular, and even survived Tiberius’s public assassination.
He was succeeded by his younger brother Gaius Gracchus (158-122 B.C.). In the ancient world transport difficulties were responsible for famines and for wild fluctuations in wheat prices. Among the reforms that Gaius proposed was that the government procure an adequate supply of wheat to be sold at a low and fixed price to everyone who was willing, to stand in line for his allotment once a month at one of the public granaries that Gaius had ordered to be built. The wheat was sold below the normal price—historians have rather generally guessed at about half-price.
The record is not clear concerning precisely who paid for this generosity, but the burden was apparently shifted as time went on. Part of the cost seems to have been borne by Rome‘s richer citizens, more of it seems to have been raised by taxes levied in kind on the provinces, or by forced sales to the state at the lower prices, or eventually by outright seizures.
Though Gaius Gracchus met a fate similar to his brother’s—he was slain in a riot with 3,000 of his followers—"the custom of feeding the Roman mob at the cost of the provinces," as the historian Rostovtzeff sums it up, "survived not only Gracchus but the Republic itself, though," as he adds ironically, "perhaps Gracchus himself looked upon the law as a temporary weapon in the strife, which would secure him the support of the lower classes, his main source of strength."¹
Bread and Circuses: The New Deal in Old Rome
An excellent account of the subsequent history of the grain dole can be found in H. J. Haskell’s book, The New Deal in Old Rome. I summarize this history here:
There was no means test. Anyone willing to stand in the bread line could take advantage of the low prices. Perhaps 50,000 applied at first, but the number kept increasing. The senate, although it had been responsible for the death of Gaius Gracchus, did not dare abolish the sale of cheap wheat. A conservative government under Sulla did withdraw the cheap wheat, but shortly afterward, in a period of great unrest, restored it, and 200,000 persons appeared as purchasers. Then a politician named Claudius ran for tribune on a free-wheat platform, and won.
A decade later, when Julius Caesar came to power, he found 320,000 persons on grain relief. He succeeded in having the relief rolls cut to 150,000 by applying a means test. After his death the rolls climbed once again to 320,000. Augustus once more introduced a means test and reduced the number to 200,000.
Thereafter during the Imperial prosperity the numbers on relief continued at about this figure. Nearly 300 years later, under the Emperor Aurelian, the dole was extended and made hereditary. Two pounds of bread were issued daily to all registered citizens who applied. In addition, pork, olive oil, and salt were distributed free at regular intervals. When Constantinople was founded, the right to relief was attached to new houses in order to encourage building.
The Right to a Handout
The political lesson was plain. Mass relief, once granted, created a political pressure group that nobody dared to oppose. The long-run tendency of relief was to grow and grow. The historian Rostovtzeff explains how the process worked:
"The administration of the city of Rome was a heavy burden on the Roman state. Besides the necessity of making Rome a beautiful city, worthy of its position as the capital of the world… there was the enormous expense of feeding and amusing the population of Rome. The hundreds of thousands of Roman citizens who lived in Rome cared little for political rights. They readily acquiesced in the gradual reduction of the popular assembly under Augustus to a pure formality, they offered no protest when Tiberius suppressed even this formality, but they insisted on their right, acquired during the civil war, to be fed and amused by the government.
"None of the emperors, not even Caesar or Augustus, dared to encroach on this sacred right of the Roman proletariat. They limited themselves to reducing and fixing the numbers of the participants in the distribution of corn and to organizing an efficient system of distribution. They fixed also the number of days on which the population of Rome was entitled to a good spectacle in the theaters, circuses, and amphitheaters. But they never attacked the institution itself. Not that they were afraid of the Roman rabble; they had at hand their praetorian guard to quell any rebellion that might arise. But they preferred to keep the population of Rome in good humour. By having among the Roman citizens a large group of privileged pensioners of the state numbering about 200,000 men, members of the ancient Roman tribes, the emperors secured for themselves an enthusiastic reception on the days when they appeared among the crowd celebrating a triumph, performing sacrifices, presiding over the circus races or over the gladiatorial games. From time to time, however, it was necessary to have a specially enthusiastic reception, and for this purpose they organized extraordinary shows, supplementary largesses of corn and money, banquets for hundreds of thousands, and distributions of various articles. By such devices the population was kept in good temper and the ‘public opinion’ of the city of Rome was ‘organized.”3
The Dole, Among Other Causes of the Fall of the Empire
The decline and fall of the Roman Empire has been attributed by historians to a bewildering variety of causes, from the rise of Christianity to luxurious living. We must avoid any temptation to attribute all of it to the dole. There were too many other factors at work—among them, most notably, the institution of slavery. The Roman armies freely made slaves of the peoples they conquered. The economy was at length based on slave labor. Estimates of the slave population in Rome itself range all the way from one in five to three to one in the period between the conquest of Greece (146 B.c.) and the reign of Alexander Severus (A.D. 222-235).
The abundance of slaves created great and continuing unemployment. It checked the demand for free labor and for labor-saving devices. Independent farmers could not compete with the big slave-operated estates. In practically all productive lines, slave competition kept wages close to the subsistence level.
Yet the dole became an integral part of the whole complex of economic causes that brought the eventual collapse of Roman civilization. It undermined the old Roman virtues of self-reliance. It schooled people to expect something for nothing. "The creation of new cities," writes Rostovtzeff, "meant the creation of new hives of drones." The necessity of feeding the soldiers and the idlers in the cities led to strangling and destructive taxation. Because of the lethargy of slaves and undernourished free workmen, industrial progress ceased.
There were periodic exactions from the rich and frequent confiscations of property. The better-off inhabitants of the towns were forced to provide food, lodging, and transport for the troops. Soldiers were allowed to loot the districts through which they passed. Production was everywhere discouraged and in some places brought to a halt.
Ruinous taxation eventually destroyed the sources of revenue. It could no longer cover the state’s huge expenditures, and a raging inflation set in. There are no consumer-price indexes by which we can measure this, but we can get some rough notion from the price of wheat in Egypt. This was surprisingly steady, Rostovtzeff tells us, in the first and second centuries, especially in the second: it amounted to 7 or 8 drachmae for one artaba (about a bushel). In the difficult times at the end of the second century it was 17 or 18 drachmae, almost a famine price, and in the first half of the third it varied between 12 and 20 drachmae. The depreciation of money and the rise in prices continued, with the result that in the time of the Emperor Diocletian one artaba cost 120,000 drachmae. This means that the price was about 15,000 times as high as in the second century.
In 301 Diocletian compounded the evil by his price-fixing edict, which punished evasion with death. Out of fear, nothing was offered for sale and the scarcity grew much worse. After a dozen years and many executions, the law was repealed.
The growing burden of the dole was obviously responsible for a great part of this chain of evils, and at least two lessons can be drawn. The first, which we meet again and again in history, is that once the dole or similar relief programs are introduced, they seem almost inevitably—unless surrounded by the most rigid restrictions—to get out of hand. The second lesson is that once this happens, the poor become more numerous and worse off than they were before, not only because they have lost self-reliance, but because the sources of wealth and production on which they depended for either doles or jobs are diminished or destroyed.
A revolution is taking place which will leave the people dependent upon the government and place the government where it must decide questions that are far better left to the people to decide for themselves. Finding markets will develop into fixing prices, and finding employment will develop into fixing wages. The next step will be to furnish markets and employment, or in default pay a bounty and dole. Those who look with apprehension on these tendencies do not lack humanity, but are influenced by the belief that the result of such measures will be to deprive the people of character and liberty.
Reported in The New York Tribune, June 20, 1931.
1History of the Ancient World, Vol. 2, p. 112.
2New York: Knopf, 1939.
3 M, Rostovtzeff, The Social and Economic History of the Roman Empire (Oxford: Clarendon Press, second edition, 1957), pp. 81-2.