Brooks Adams was an American historian and critic of capitalism from a classical republican/agrarian/populist point of view.
Brooks Adams was from an immensely accomplished family. He was a great-grandson of President John Adams, a grandson of President John Quincy Adams, a son of diplomat Charles Francis Adams, and the brother of Henry Adams, the philosopher and historian whose own theory of history was influenced by his brother’s work.
Brooks Adams’ greatest work, The Law of Civilization and Decay: An Essay on History , is an essential document for understanding Third Way economics, specifically the classical republican/agrarian/populist critique of capitalism in the name of preserving freedom and private property.
In his Politics, Aristotle argues that a society that wishes to preserve freedom needs a large middle class. By a middle class, he specifically meant people who owned property and were self-employed rather than employed by others. From Aristotle’s time to the 20th century, most human beings were involved in agriculture. Thus the middle class consisted primarily of small farmers. Consequently, the problem of preserving freedom was inevitably framed in terms of agrarian economics. The lessons still apply, however, to middle classes in post-agrarian societies.
In chapter 1, “The Romans ,” Adams illustrates how capitalism ruined Rome. The backbone of Rome’s strength was its yeomanry: its small farmers and militia men, the legionaries who conquered antiquity’s greatest empire. Adams establishes a number of striking conclusions.
Adams argues that Rome never had an aristocracy in the strict sense of the term, meaning a ruling elite chosen for their excellence in virtue, valor, and statesmanship. Instead, the Roman elite from the beginning was oligarchic or plutocratic, defined by wealth. When the populace held the power of the oligarchy in check, Rome’s yeomanry made her the mistress of the world. However, the oligarchical forces ultimately triumphed, which led to the destruction of the Roman middle class, then to the destruction of the Empire, and ultimately to the destruction of the oligarchs themselves.
The economic devices by which the Roman oligarchy destroyed the Roman farmers are threefold: (1) usury, (2) deflation, and (3) cheap labor.
Farming is a perilous profession, since a farmer can be ruined by bountiful as well as bad harvests. (Bountiful harvests can cause prices to fall below the costs of production.) Thus farmers tend to borrow. In ancient Rome, however, money-lending was usurious: interest was high, which made defaults more common, and when defaults did take place, the debtor could lose not just his property but his life and that of his family, for debtors and their heirs could be reduced to slavery to repay loans.
The problem was confounded by deflation. In ancient Rome, gold and silver coins served as currency. As Rome’s empire grew, immense amounts of gold and silver were brought back as war booty from the East. However, most of this gold and silver began to flow back to the East in exchange for luxury goods like silk, spices, glassware, and perfumes. This money did not return to Rome, for Rome exported very little, and its ultimate destinations, such as China and India, were too far away to be conquered.
As the amount of currency in circulation declined, the value of money began to rise, which meant that prices denominated in the currency began to fall (assuming that production stayed constant). Deflation makes it harder to pay back loans, for every year one must work harder and harder to make the same amount of currency to service one’s debts.
To deal with deflation, the Romans constantly debased the value of their currency. Eventually, they repudiated their silver currency altogether and went to a pure gold standard, which had devastating consequences. The gold standard tends to be deflationary, since its supply usually does not grow quickly, and gold has a tendency to be taken out of circulation in the form of jewelry, religious offerings, and hoards.
Before the invention of modern fiat currency, the gold standard was the preferred monetary instrument of money-lenders, since they are benefited by deflation. This is the basis of the nineteenth-century populist advocacy of bimetallism: gold and silver currency. Charlemagne established the pound sterling–literally a pound of silver–as the European monetary standard, reversing the deflationary tendency that had existed in the West since the silver denarius was repudiated in 220 AD.
Furthermore, the successes of the Romans as legionaries led to their undoing as farmers. Rome’s victories led to the enslavement of entire nations. These slaves provided cheap labor, which allowed large landowners to undercut the prices of small farmers. When Egypt was added to the Empire in 30 BC, its impossibly fertile land tilled by wretched fellaheen spelled doom for the Roman farmer. Adams describes how entire districts of Italy were depopulated. Farmers starved to death, abandoned their lands and drifted to the cities as paupers and proletarians, or simply failed to reproduce themselves.
But as Adams reveals, the Roman system did not merely exterminate the Roman middle classes. It also destroyed the plutocrats as well. As early as the reign of Augustus, many of the great Roman families were becoming extinct. The life of money-making and pleasure-seeking increasingly absorbed their energies. There was little interest in child-rearing. By the end of the second century, Rome’s Emperors were no longer Romans. None of the great Roman families seemed to have survived the end of the Empire in the West. All of them were extinct in Byzantium by the beginning of the 8th century.
Rome was never really a people, never a nation. It was merely a system, a machine. From the very beginning, according to its own founding myths, Rome populated itself by opening its gates to refugees from other cities and by abducting the Sabine women. Obviously somebody had to be there to open the gates, and a common Roman religion, culture, and identity emerged. But the Roman machine liquidated this founding stock and replenished itself with foreign blood until it became too weak to assimilate new peoples. Eventually the Germans in the West and the Muslims in the East kicked over the table and started something new.
In the late 19th century, Brooks Adams saw clear analogies between ancient Rome and America. The analogies have only grown stronger, and Adams’ work has never been more relevant.
In ancient Rome, as in modern America, the economic system and its imperatives are treated as absolute and fixed, whereas the people are treated as liquid and fungible. Nationalism represents a complete reversal of these priorities. For the nationalist, a people and its interests are absolute and non-negotiable. The economic system must be subservient. Thus for nationalists there are no economic absolutes.
Capitalists tend to treat private property, markets, rights, trade, etc. as unconditional goods that trump all national interests. For the nationalist, however, the only unconditional good is the interest of the nation. Markets, private property, rights, etc. are good only on the condition that they serve the people. When they fail to serve the common good, they must be corrected.
The Tea Party and Occupy Wall Street movements are drawing upon a deep discontent with America’s plutocracy. Adams shows where such plutocracies come from, how they sustain themselves, and how they eventually perish. The Law of Civilization and Decay  should be required reading for those who wish to create a better society. To that end, I will be serializing selected chapters at Counter-Currents/North American New Right in the coming weeks.