Economics Part 2

The beginnings of economic history started with the beginning of human history. The economy deals with
the production, distribution, and the consumption of goods and services. The first age of the human race
starts in the Paleolithic Era (or the Old Stone Age). This was the time when humans worked readily in bands
or small kin groups. These bands communicated with each other in order to trade ideas. Some told stories.
Others used tools, gathered foods, gathered skins plus other commodities. Flora and Fauna had massive
differences back then, competition was unique and the climate was massively different than today. Human
beings used various forms of technologies to adjust to the climate and to increase productivity. For example,
there were handmade tools and objects like the cudgel, the club, sharpened stone, the chopper, a spear, the
hand axe, the harpoon, etc. Many of these objects were used to hunt and gather animals. Humanity lived in
caves, huts, and by rivers plus lakes. Some human beings back then believed in an afterlife. There were burial
rituals and ancestor worship too. Priests, shamans, and sanctuary locations did exist during this time period.
The global population of humanity grew during this time was from 1 to 15 million people. Some scholars
believe that during this period of prehistory, the world average GDP per capita was about $158 per annum
(adjusted to 2013 dollars), and did not rise much until the Industrial Revolution.

This age lasted form ca. 500,000 B.C. to 10,000 B.C. Next, the Mesolithic Age started with the end of the last
glacial period (which dealt with the Ice Age) over 10,000 years ago. Human beings domesticated plants and
animals during this time period. There were many formations of settled communities in various times and
places. The Mesolithic era saw tribes and bands flourishing. Economic activities existed in various villages.
There were more complex tools like the harpoon, the bow and arrows, etc. Some of them fished, created
baskets, and hunted plus gathered wild animals. Many of them used seeds of wild plants for domestic use
and planting. Some used extensive hunting.

Neolithic Era
The Neolithic Era represented a revolutionary period of humanity and of technology including the economy.
It lasted from ca. 10,000 B.C. to ca. 3,300 B.C. Tons of new inventions, structures, and technologies flourished
during the Neolithic period. This was one of the greatest parts of human history. It was the start of the
agricultural revolution in the world. People started to live in stationary locations. More animals were bred to
be domesticated. People worked in farms. Settled communities and the first cities were created (as hunter
gatherers started to settle down in locations permanently). There was agriculture in the modern sense in the
Middle East as early as 8,000 B.C. People in India, Africa, the Americas, Southeast Asia, China, Europe, etc.
grew villages and other civilizations. Jericho and Catal Huyuk (in Turkey) were some of the earliest modern
cities and towns in human history.

Human beings used more medal tools. Mud brick houses flourished during this time including ladders and
doorways. Cooking tools existed. Within each tribe the activity of individuals was differentiated to specific
activities, and the characteristic of some of these activities were limited by the resources naturally present
and available from within each tribe's territory, creating specializations of skill. By the "... division of labor and
evolution of new crafts ..." (Cameron p. 25) Tribal units became naturally isolated through time from the
over-all developments in skill and technique present within their neighboring environment. To utilize
artifacts made by tribes specializing in areas of production not present to other tribes, exchange and trade
became necessary. Scholars believed that cattle were used as currency back then. Trading in red ochre is
attested in Swaziland, shell jewelry in the form of strung beads also dates back to this period, and had the
basic attributes needed of commodity money. To organize production and to distribute goods and services
among their populations, before market economies existed, people relied on tradition, top-down command,
or community cooperation.
 The Bronze and Iron Ages
The Bronze Age was one of the most important parts of world history. It was the era that had people using
bronze worldwide, proto-writing existed, and urban civilization has grown into the next level. Back then,
many people used smelting cooper and alloying with tin, arsenic, or other metals to form bronze. Bronze was
more durable than many other metals, so the Bronze Age lasted for a long time with great technological
proficiency. The era of the Bronze is different from region to region. In Ancient Egypt and the Middle East, it
lasted from ca. 3,300 B.C. to 1,200 B.C. In South Asia, it lasted from ca. 3,000 B.C. to 1,200 B.C. In Europe, it
lasted from ca. 3,200 B.C. to 600 B.C. In East Asia, it lasted from ca. 2,000 B.C. to 300 B.C. In sub-Saharan
Africa (in places like Nubia and West Africa), it lasted from ca. 2,300 B.C. to 400 B.C. In the Americas, it lasted
from ca. 2,100 B.C. to 1,000 B.C. Trade occurred among the ancient civilizations of Egypt, Mesopotamia, and
the Indus Valley Civilization.

During this time, the city states of Sumer formed a trade and market economy. It was based on the
commodity money of the shekel which was a certain weight measure of barley. Using the shekel as a unit of
weight and currency was first recorded in circa 3,000 B.C. A specific usage of weight included barley and
equivalent amounts of silver, bronze, copper, etc. The Babylonians and their city state neighbors later
developed the earliest system of prices using a metric of various commodities that was fixed in a legal code.
The early law codes from Sumer could be considered the first written financial law. It had many parts still in
use in the current price system today like the codified quantities of money for business deals (interest rates),
fines for wrongdoing, inheritance rules, law concerning how private property is to be taxed or divided, etc.
The Babylonian law was historic. Back then, many places in the Bronze Age had temples using creditors at
interest. It started with Sumer during the third millennium B.C. By charging interest and ground rent on their
own assets and property, temples helped legitimize the idea of interest bearing debt and profit seeking in
general. Later, while the temples no longer included the handicraft workshops which characterized third
millennium Mesopotamia, in their embassy functions they legitimized profit seeking trade, as well as by
being a major beneficiary. This period had places using commodity money or objects with value in
themselves as their value used as money.

The Babylonians and their neighboring city states later formed the earliest system of economics as we think
of it today in terms of rules on debt, legal contracts, and law codes relating to business practices and private
property. The Code of Hammurabi, the best preserved ancient law code, was created ca. 1760 B.C. in ancient
Babylon. It was enacted by the sixth Babylonian king, Hammurabi. Earlier collections of laws include the code
of Ur-Nammu, king of Ur (ca. 2050 BC), the Code of Eshnunna (ca. 1930 BCE) and the code of Lipit-Ishtar of
Isin (ca. 1870 BC). These law codes formalized the role of money in civil society. They set amounts of interest
on debt... fines for 'wrongdoing'... and compensation in money for various infractions of formalized law.
Ancient China, Africa, and India used cowry shells as money. Metals were used for money too back then. The
use of gold as proto-money has been traced back to the fourth millennium BC. when the Egyptians used
gold bars of a set weight as a medium of exchange, as had been done earlier in Mesopotamia with silver
bars. There was money used by the Philistine people too.

The Iron Age lasted from ca. 1,200 B.C. to 600 B.C. depending on the region. From about 1,000 B.C. and later,
many forms of money took the shape of small knives and spades made of bronze in China during the Zhou
dynasty. They had cast bronze replicas of cowrie shells in use before this. The first manufactured coins seem
to have taken place separately in India, China, and in cities around the Aegean Sea between 700 and 500 BC.
While these Aegean coins were stamped (heated and hammered with insignia), the Indian coins (from the
Ganges river valley) were punched metal disks, and Chinese coins (first developed in the Great Plain) were
cast bronze with holes in the center to be strung together. The different forms and metallurgical process
implies a separate development. The first ruler in the Mediterranean known to have officially set standards of
weight and money was Pheidon. Minting occurred in the latter parts of the 7th century among the cities of
Grecian Asia Minor, spreading to Aegean parts of the Greek islands and the south of Italy by 500 B.C. The
first stamped money (having the mark of some authority in the form of a picture or words) can be seen in
the Bibliothèque Nationale of Paris.

It is an electrum stater of a turtle coin, coined at Aegina island. This coin dates about 700 BC. Other coins
made of electrum (a naturally occurring alloy of silver and gold) were manufactured on a larger scale about
650 BCE in Lydia (on the coast of what is now Turkey). Similar coinage was adopted and manufactured to
their own standards in nearby cities of Ionia, including Mytilene and Phokaia (using coins of electrum) and
Aegina (using silver) during the 6th century BC. and soon became adopted in mainland Greece itself, and the
Persian Empire (after it incorporated Lydia in 547 BC). The use and export of silver coinage, along with
soldiers paid in coins, contributed to the Athenian Empire's 5th century BC, dominance of the region. The
silver used was mined in southern Attica at Laurium and Thorikos by a huge workforce of slave labor. A
major silver vein discovery at Laurium in 483 B.C. led to the huge expansion of the Athenian military fleet.
 Classical Antiquity
The Classical Age of world history lasted from 500 B.C. to 500 A.D. It was after the Iron Age. The Classical Age
related to the further development of world empires, the expansion of trade, and the further complex
growth of human interactions. Back then, India and China had the biggest economies in the world at that
time. Each had more than half of the size of the world’s economy. They had high GDP, but they didn’t have
significantly higher GDP per capita. Each had major population centers too. Commercial changes grew as
result of the actions of Alexander the Great too. He facilitated multi-national trade. Julius Caesar of ancient
Rome also conquered France and Britain. By the time of the Roman Empire, Egypt was the wealthiest of all
places within the Roman Empire. The merchants of Rome acquired produce from Persia via Egypt by the port
of Berenince and subsequently the Nile. Ancient Nubia during the classical period had its ideas and
technologies travel in the rest of Africa, Europe, Asia, etc. Nubia traded with Chad, Libya, Egypt, China, India,
and the Arabian Peninsula too. The Bantu migration during this period continued. In ancient China, there was
the Warring States era from the 5th century to 3rd century B.C. As the feudal system collapsed, most
legislative power transferred from the nobility to local kings. Increased trade during the Warring States
period produced a stronger merchant class. The new kings in ancient China established an elaborate
bureaucracy, using it to wage wars, build large temples, and enact public-works projects. This meritocratic
system rewarded talent over birthright. Greater use of iron tools revolutionized agriculture and led to a large
population increase during this period.

In 221 B.C., the king of the Qin declared himself the First Emperor, uniting China into a single empire. The
Qin Dyansty saw its various state walls into the Great Wall, and its various peoples and traditions into a
single system of government. The Qin emperor unified standards of writing, weight measurement, and wheel
length. It ended old currencies that varied among states. Trade was easier to execute. It had heavy taxation
of salt and iron manufactures. Many Chinese people were forcibly migrated to new territories in the south
and west. Although their initial implementation led to its overthrow in 206 B.C., the Qin's institutions
survived. During the Han Dynasty (from 3rd century B.C. to 3rd century A.D.), China became a strong, unified,
and centralized empire of self-sufficient farmers and artisans, with limited local autonomy. The Han dynasty
in China was a Golden Age. There was rapid growth. Its population reached 58 million people. There was the
wheelbarrow, paper, and a seismograph which was invented during this period.

According to Herodotus, and most modern scholars, the Lydians were the first people to introduce the use
of gold and silver coin. It is thought that these first stamped coins were minted around 650–600 BC. A stater
coin was made in the stater (trite) denomination. To complement the stater, fractions were made: the trite
(third), the hekte (sixth), and so forth in lower denominations. The first economist (at least from within
opinion generated by the evidence of extant writings) is considered to be Hesiod, by the fact of his having
written on the fundamental subject of the scarcity of resources, in Works and Days. Indian thinker Chanakya
wrote Arthshastra, science of economics in contemporary India in 4th century BC. Greek and Roman thinkers
made various economic observations, especially Aristotle and Xenophon. Many other Greek writings show
understanding of sophisticated economic concepts. For instance, a form of Gresham’s Law is presented in
Aristophanes’ Frogs. Bryson of Heraclea was a neo-platonic who is cited as having heavily influenced early
Muslim economic scholarship.

The Middle Ages

During the Middle Age, the world economy slowly expanded with the increase of population and trade.
There was the Silk Road that was used for trading from Europe, Central Asia, and to China. The Axumite
Kingdom of Ethiopia and Eritrea had a powerful navy. They established trade with the Byzantine Empire and
India. Islamic areas by the Middle East expanded trade, literacy, and centralized states. By 1324, Mansa Musa,
the king of Mali, made a historically famous Hajj (pilgrimage) to Mecca. The hajj is a requirement among
every Muslim if one is able to do so. There was an enormous group organized to undertake the Hajj with the
king. It included "60,000 men, including 1200 servants" and records show that Mansa Musa gave out so
much gold in Egypt, that its economy became depressed.

Between 1000 and 1500, the forests of West Africa also became part of trade networks, particularly
under the reigns of the Yoruba kings. Ifé was a vital trade town, along the route from the tropical forests
to Djenné, a major trade center in Sudan, near other large trade cities such as Timbuktu and Gao. Ifé's
location also placed it near Benin and the Atlantic Ocean. The Yoruba civilization was supported by cities
surrounded by farmed land, but extensive trade development made it wealthy. The stone city of Great
Zimbabwe, founded around 1100, was the center of the Shona kingdom until around 1400. In the Tang
dynasty (in ancient China), there was another Golden Age in China. By 630, the Tang had conquered the
powerful Gokturk Khagnate, preventing threats to China's borders for more than a century. A series of strong
and efficient rulers, beginning with the founder and including a woman, expanded the Tang Empire to the
point that it rivaled the later Yuan, Ming and Qing.

The Silk Road had a great deal to do with the economic trade in the ancient world.

The Tang was a period of rapid economic growth and prosperity, seeing the beginnings of woodblock
printing. Tang rulers issued large amounts of currency to facilitate trade and distributed land under the
equal-field system. The population recovered to and then reached an estimated 80 million human beings.
The Chinese Song period (10th–13th century A.D.) brought additional economic reforms. Paper money, the
compass, and other technological advances facilitated communication on a large scale and the widespread
circulation of books during the Song period. The state's control of the economy diminished, allowing private
merchants to prosper and a large increase in investment and profit. Despite disruptions during the Mongol
conquest of 1279, the 2nd plague epidemic in the 14th century, and the large-scale rebellions that followed
it, China's population was buoyed by the Columbian Exchange and increased greatly under the Ming (14th–
17th centuries). The Ming dynasty of China saw cash crops grown and it was founded by Zhu Yuanzhang.
Many state industries were privatized. The Ming Dynasty was a very important era of Chinese history.
 Key Events of the Middle Age Period

The Carolingian Empire The spread of Islam was The Crusades were During the establishment of
has lasted from 800 to fast. After the death of brutal religious wars the medieval period, there
888 A.D. It was ruled Muhammad at 632, that were sanctioned was the growth of churches
heavily by the Muslims ruled Syria and by the Catholic Church. plus monasteries in the
Germanic peoples of Egypt by 641. They It involved numerous Romanesque style. One
the Franks. One ruled North Africa wars and battles. Some example of this style of
famous Carolingian, including the Iberian Crusaders pillaged architecture is found in the
Frankish King was peninsula as early as lands as they traveled Romanesque Church of
Charlemagne who was 711. into the Middle East. Maria Laach as found in
crowned emperor in Feudalism, militarism, Germany (which is found
Rome by Pope Leo III and other realities were above).
at 800 A.D. found during that time
period.

During the early part of the Middle East, Europe was in chaos because of wars, the end of the Western
Roman Empire, and other problems. By the later medieval period, rich trading cities in Italy developed. They
created the first modern accounting and finance systems in Europe. The first banknotes were used in the
Tang dynasty China in the ninth century A.D. It expanded use during the Song dynasty. By the first
millennium A.D., there were improvements in technique and technology in the world. Monasteries
developed. There were centers of the collection of knowledge involving agriculture and forestry. Irrigation
improved. There were trade among Europeans, Africans, and Asians. Those in the Americas traded with each
other too. Economies in Oceania, Australia, and the rest of the world existed. Land use increased and
population increased. Large landowners had significant control over both their land and its laborers, who
were peasants or serfs. More iron smelting caused more tools to be developed for developing society.

Watermills and windmills spread in the world. There was the Great Famine from 1315 to 1317. It weakened
populations in Europe and parts of Asia too. From the 8th century to the 12th century, there were the Vikings
using long distance navigation to travel into Europe, America, parts of Africa, and the Middle East. There was
the long-ship and the astrolabe used by the Vikings and others for navigation. Guilds and merchant
capitalism was formed. This was about merchant houses, backed by financiers acting as intermediaries
between simple commodity producers. This system continued until it was supplanted by industrial capitalism
in the 18th Century. City states like in Italy developed. Genoa and Venice created large wealth. In the North
Sea and the Baltic Sea, the Hanseatic League trade monopoly grew trade along the 2 seas. Lubeck was the
city leader of the Hanseatic League. In the late 1400’s, the economies of Europe (especially in France) did
grow and recuperated from the economic catastrophes and bad harvest plus famines including wars.

By 1500
By 1500, the world has changed. This era was the start of the massive international slave trade. It was during
the late 1400’s when Portugal began the modern International slave trade involving the oppression of black
African people. There were early European colonists in North Africa like the ancient Greeks. The modern
economy as we know it today revolved around the brutal oppression of black people and the genocide of
the indigenous peoples of the Americas literally. Portuguese prince Henry the Navigator made it very clear
that he wanted to travel into Africa as a means to get resources and try to convert as many African people to
his version of Christianity (in the midst of the Ottoman Empire, which was mostly Muslim). Not all Christians
are responsible for the Maafa. It is that evil people purposely perverted the essence of real Christianity as an
excuse for them to commit evil. It’s like not all Muslims are responsible for the Arabic slave trade (which was
evil and unjust), but some people claiming to be Muslims are responsible for it. The Portuguese refused to
sell the African people guns, but they sold Africans Indian cloth and European manufactured goods. Europe
itself used imperialism and massive economic exploitation as a means for that continent to grow their
various brutal empires in the world. As we know, after 1500, the world would change forever.

By Timothy
 Economics Part 3 (1500-1900)
This period from the time of 1500 to the end of the 19th century) outlined an explosion of economic
developments and historical events. Situations like the growth of global empires and the existence of
mercantilism radically changed the whole world. This era saw the evil Maafa developed and the Industrial
Revolution. It was a time when the both the spreading of the evil of Western imperialism and various
Revolutions transpired. The many Revolutions opposed not only monarchies, but the concept of absolutism
itself. Heroic black men and black women were involved in the Haitian Revolution where they fought against
slavery plus against Western imperialism. The French Revolution existed as a way for people to defeat French
absolutism. Philosophers during this time period modernized their perspectives on the issues of economics
(relating to goods and services plus the role of the state in the economy). Cantillon’s work of “Essai” dealt
with economic research which influenced the works of Smith, Say, Bastiat, and Quesnay. People wanted to
evaluate how the economy works, how economic theories functioned in real world scenarios, and the
government’s relationships to the economy in general.

Classical economic theory (or the market regulating the economy without government intervention) spread
worldwide. The Age of Reason, the Industrial Revolution, the Revolutionary War, and the Civil War made us
aware of the dynamic aspect of the economy. Industries grew, societies made more complex economic
structure, and many people fought for human plus workers’ rights as well. Also, another important point
must be mentioned. The slave trade was a crucial aspect of the modern day economy. In other words, the
experiences of black slaves and other human beings economically benefited racists and corporatists via
capitalism (as explained by the book entitled, "How Capitalism Underdeveloped Black America: Problems in
Race, Political Economy, and Society Kindle Edition" by Manning Marable whose foreword was written by
Leith Mullings) who wanted profit at the expense of human dignity. That is wrong. So, economic history must
to be told in an honest, forthright fashion. In that sense, we can learn lessons and promote economic justice
more thoroughly. This work will explain the economic realities among the four hundred years from 1500-
1900.

Early Modern Era

The early Modern Era was after the Middle Ages. The early Modern Age lasted from about 1500 to 1750 A.D.
(which the Age of Revolutions existed afterwards). This time saw mercantilism, nationalism, and international
trade. National economic systems were strengthened. This saw the time of European explorers who traded
the world in Africa, Asia, and the Americas. Many of them used pseudo-religious justifications as a means for
them to conquer lands for European monarchs. For example, Christopher Columbus was a male who traveled
into the Caribbean, but he and his allies were responsible for the genocide of Native Americans in
Hispaniola. Some have exploited Christianity as a means to oppress others, which is wrong and evil. Vasco da
Gama traveled in Africa and Asia by 1498. This time was part also of the price revolution. There was high
inflation in Western Europe. Some believe that this high inflation was a result of the large influx of gold and
silver from the Spanish treasure fleet from the New World, including Mexico, Peru and the rest of the
Spanish Empire. Many imperialists got gold and silver by theft in funding their economies. During the 1500’s,
Spanish explorers traveled into the Americas to explore and black slaves were with them as well. By the late
1500’s and early 1600’s, English explorers traveled into the Americas. In 1619, the first African slaves came
into the Virginia colony by force. The growth of urbanization worldwide continued. Newly-powerful
monarchies wanted a more powerful military state to boost their status. Mercantilism was a political
movement and an economic theory that advocated the use of the state's military power to ensure that local
markets and supply sources were protected.

The first banknote in Europe was issued by Stockholms Bancoin 1661. This time marked a growth of global
integration of economies, foods, and other aspects of human culture. There was the colonization of the
Americas by many Europeans. There was the exchange of goods, plants, animals, and food crops among the
Old World and The New World. This reality is called the Columbian Exchange. In Europe, feudalism declined
by this time with the Protestant Reformation, the bloody Thirty-Years Wars, the Commercial Revolution, and
pirates. In Asia, the Ming Dynasty grew in trade with Portugal, Spain, and the Netherlands. In 1547, Ivan the
Terrible was the first czar of Russia. The Ming Dynasty in China used banknotes as the common medium of
exchange. More silver in China undermined state revenues in the Chinese economy. This damage continued
with the Little Ice Age’s effects of harming agriculture. The Qing Dynasty of China lasted from 1644 to 1912,
which was the last ruling dynasty of China. Japan had its Nanban trade after the arrival of the first European
Portuguese during the Azuchi-Momoyama period. The Mughal Empire in India lasted from the 17th century
to the early 18th centuries. Back then, India was influenced not only by Hinduism, but by Islam as well. The
Ottoman Empire dominated the Middle East and parts of Northern Africa. One famous leader of the
Ottoman Empire during the 1500’s was Suleyman the Magnificent. He reigned for 46 years and he added
new territories along with making more developments among the Ottoman Empire.

In sub-Saharan Africa, the Songhai Empire economically controlled the trans-Saharan trade at the beginning
of the modern era. Around the beginning of the modern era, the Benin Empire was an independent trading
power in West Africa, blocking the access of other inland nations to the coastal ports. Benin may have
housed 100,000 inhabitants at its height, spreading over twenty-five square kilometers, enclosed by three
concentric rings of earthworks. By the late 15th century, Benin was in contact with Portugal. In ca. 1585, King
Kongolo Maniema established the Kingdom of Luba in Central Africa. Africa suffered the injustice of the
slave trade and imperialism during this time too.

The European international slave trade among the Americas was created by the Portuguese and the Spanish
(before that, there was the Islamic slave trade among Africa and Asia). The international slave trade stripped
black people of their names, cultures, creeds, and lands in a vicious fashion. There has been an acceleration
of the development of experimental science, the existence of humanism, the improvements in mapping plus
ship design, and technological development. The early Scientific Revolution lasted from 1543-1687.
Copernicus said that the Earth revolved around the sun. Galileo Galilei wrote that objects in a vacuum fall at
the same rate regardless of weight. Francis Bacon promoted the scientific method. The English physician
William Harvey studied butchered animals and found that blood circulates throughout the human body.
Blaise Pascal invented the mechanical calculator in 1642. Isaac Newton wrote about the laws of motion and
gravity in 1687. There was the emergence of nation states and secularized civic politics.
 Mercantilism
Mercantilism is an economic policy that dominated the early modern age of human history from the 16th
century to the 18th century. Its goal is to maximize the trade of a nation to gain more gold, silver, and other
resources. Mercantilism deals with accumulating monetary reserve via the balance of trade especially of
finished goods. This policy increased wars and colonial expansion worldwide in the Americas, Africa, Asia,
etc. In essence, mercantilism means that trade generates wealth and is stimulated by profitable balances
which a government should encourage by means of protectionism. It promoted the government regulation
of a nation’s economy in augmenting state power at the expense of rival national powers. It deals with
commercialism too. That is a system in which a country attempts to amass wealth through trade with other
countries, exporting more than it imports and increasing stores of gold and precious metals.

Also, mercantilism readily used colonies and slavery as a means to gain resources and exploit human lives at
the same time in a disgraceful fashion. One example of how cruel mercantilism is how England during the
17th century wanted gold, so they formed a colony in America. America (in the Eastern seaboard) didn't have
gold in a mass scale, but America had massive cotton. So, England buys cotton and allowed slaves to pick
cotton, but they don’t allow American colonies to produce cotton independently without slavery. Later,
England sells the cloth to America and England including France (England’s rival) gets the profit. Afterwards,
England gets the profits and the cycle goes onward again. This system funds cities and towns (and benefit
the super wealthy primarily), but many in Europe, Africa, and the Americas are poor. Giovanni Botero and
Antonio Serra including Jean Bodin plus Colbert wrote about mercantilism themes. By the 16th century,
modern capitalism existed in Europe. Join stock companies involve corporations have used stock to fund
their business enterprises.

In colonial America before the 1780’s, it was filled with many ethnic groups, slavery, and the genocide of the
Native Americans. Resources were abundant and exploited and labor existed. The economic output of the 13
colonies increased 12 fold from 1700 to 1775. Population growth grew the economy of the 13 colonies too.
The British put restrictions on the products being made in the colonies and put restrictions on trade outside
of the British Empire. Back then, there was a market economy. People used mining, gristmills, and sawmills.
There was the export of agricultural products. The most important agricultural exports were raw and
processed feed grains (wheat, corn, rice, bread and flour) and tobacco. Tobacco was a major crop in the
Chesapeake Bay region and rice was a major crop in South Carolina. Dried and salted fish was also a
significant export. North Carolina was the leading producer of naval stores, which included turpentine (used
for lamps), rosin (candles and soap), tar (rope and wood preservative) and pitch (ships' hulls).

Another export was potash, which was derived from hardwood ashes and was used as a fertilizer and for
making soap and glass. The colonies depended on Britain for many finished goods. Wagon transport was
expensive. The economies of the New England, Middle, and Southern colonies were diverse too. Historian
Carl Bridenbaugh examined in depth five key cities: Boston (population 16,000 in 1760), Newport, Rhode
Island (population 7,500), New York City (population 18,000), Philadelphia (population 23,000), and Charles
Town (Charlestown, South Carolina), (population 8,000). He argued that they grew from small villages to take
major leadership roles in promoting trade, land speculation, immigration, and prosperity (which benefited
certain people and not others), plus in disseminating the ideas of the Enlightenment (including new methods
in medicine and technology). Most people in the American colonies back then lived in the rural locations.
The tensions among the colonies and the British Empire ultimately caused the American Revolution.

Free enterprise Philosophers

Economic philosophers grew during the early modern age. By the 18th century, the Physiocrats believe that
the wealth of nations was derived solely from the value of “land agriculture” or “land development.” Quesnay
believed that the economy was divided into 3 sectors of the manufacturing sector, the agriculture, and those
who consume the food. Cantillon wrote about risk taking in the economy. Classical economics believed that
the markets can regulate themselves without any state intervention. Adam Smith was one of the most
influential economic philosophers in history. He wrote books like the Division of Labor and the Invisible
Hand. He believed in the free market with little regulation. He was a Scottish man who lived from 1723 to
1790. He wrote literature like The Theory of Moral Sentiments in 1759 and the Wealth of Nations by 1776.
He believed in the division of labor and how rational self-interest and competition can lead into economic
prosperity. Smith believed in the free market, but even Adam Smith didn’t want businesses to form cabals or
monopolies to fix prices or do economic corruption. Additionally, Smith outlined the proper expenses of the
government in The Wealth of Nations, Book V, Ch. I. Included in his requirements of a government is to
enforce contracts and provide justice system, grant patents and copyrights, provide public goods such as
infrastructure, provide national defense and regulate banking.

This proves that Adam Smith believed in classical economics, but he wasn’t a total laissez faire capitalist. Say
was a philosopher who believed that supply creates its own demand and that the markets don’t need help in
creating purchasing power. I of course don’t agree with that view. Ricardo was a follower of Smith and he
believed in Say’s law. He promoted the theory of comparative advantage, which wanted trading being useful
for everyone even poorer nations. Thomas Malthus was very controversial. He was a bigot and an enemy of
poor people and people in general. He promoted the lie that people are poor, because they are immoral. He
wanted poor people to produce fewer children in order for population control to exist. He believed that
property owners were morally superior. He is the founder of modern day classism in my view. Malthus
believed that population growth will rise and cause global chaos except by reactionary policies. His views on
population growth have been discredited too. Mills believed in the involvement of government to correct
inevitable inequalities.

The American Revolution

Colonial America was dominated by mercantilism. England, France, Spain, and the Dutch Republic wanted to
protect their investments in colonial ventures by limiting trade between each other’s colonies. Spain wanted
to get gold and silver to promote old style mercantilism. The Dutch and the British wanted to use private
business to benefit themselves. The British used the Navigation Acts to handle British American colonies.
These acts from 1651 and 1673 wanted foreign ships to be banned from trade between ports within the
British Empire. It wanted manufactured goods to go through England before going to the colonies. It also
allowed ship masts, rice, indigo, and tobacco to be exported to Great Britain. They were enforced. By the late
1700’s, England was in the early stage of the Industrial Revolution, so many finished goods were exported to
the colonies. Colonists paid minimal taxes. The colonies had much economic freedom. Virginia had charter
companies or groups of stockholders (like merchants and landowners) gaining money to advance the British
Empire.
The private sector financed the companies; the king provided each Key Events of the American
project with a charter or grant (given certain rights). The colonies Revolutionary War
showed profits and many English investors gave charters to the
settlers. Later, the colonists formed their own businesses. The British
used the tax of the Molasses Act of 1733 to fund exports to England.
There were new taxes like the Sugar Act of 1764, the Stamp Act of
1765 and taxes on tea and other colonial imports, which was done in
part to compensate the British Empire after the French and Indian
War. The American Revolution existed not necessarily about taxes (as
taxes were low back then). It was about the constitutional authority of
Parliament verses the colonial assemblies to vote on taxes. So, many
colonists wanted no taxation without representation. The Americans
in the thirteen colonies wanted their rights (as Englishmen as they see This image shows George Washington
it) as a means for them to select their own representative to govern and Lafayette inspecting the troops at
and tax them. Valley Forge in Pennsylvania.
American troops stayed there from
December 19, 1777 to June 19, 1778.
The British refused to do this. Then, the Americans attempted
resistance via boycotts of British manufactured items. The British
responded with a rejection of American rights and formed the
Intolerable Acts of 1774. Soon afterwards, the Americans launched
the American Revolution. The American Revolution was an all-out war
against the British and the result was the independence to form the
United States of America. The British wanted to end the American
economy by using a blockade of all ports. The American economy
was resilient and survived. The reason was that America was 90%
farming and 10% in the cities. The American Revolutionary War lasted These are American soldiers in
from 1775-1783. Many people promoted unalienable rights of life, combat during the Battle of Long
liberty, and the pursuit of happiness, but they hypocritically owned Island in 1776.
slaves. Individual liberty, entrepreneurship, and promoting values of
liberalism and republicanism existed as a framework for the colonies
desiring independence from the British Empire. Philosophers during
that time emphasized natural rights, equality under the law for all citizens, the general welfare, and civic
duty. Britain’s war against the Americans, French, and the Spanish cost about £100 million. The Treasury
borrowed 40% of the money it needed and raised the rest through an efficient system of taxation. Heavy
spending brought France to the verge of bankruptcy and revolution. Congress and the American states had
trouble financing the war. In 1775, there was at most 12 million dollars in gold in the colonies. This was not
enough gold to cover the existing transactions or the war. The British imposed a blockade on every American
port. This cut off almost all imports and exports. That is why the early Americans relied on volunteer support
from militiamen and donations from supportive citizens. The colonists wanted to pay money by delaying
payments to soldiers and suppliers in a depreciated currency. They promised it to make good after the war.
 Early America
In 1783, many soldiers and officers were given land grants. This was done to cover the wages that they had
earned, but had not been paid during the war. There was no strong leader in financial matters until 1781
when Robert Morris was the Superintendent of Finance of the United States. Morris used a French loan in
1782 to set up the private Bank of North America to finance the war. Seeking greater efficiency, Morris
reduced the civil list, saved money by using competitive bidding for contracts, tightened accounting
procedures, and demanded the federal government's full share of money and supplies from the states.
Congress used four ways to fund the war. It cost 66 million dollars in specie (gold and silver). Congress made
two issues of paper money, in 1775-1780, and in 1780-81. The first issue amounted to 242 million dollars.
This paper money would supposedly be redeemed for state taxes. Yet, the holders paid them off in 1791. It
was done at a rate of one cent on the dollar. In 1780, there was a second issue of new currency. It became
worthless. That was redeemed by the new federal government in 1791 at 100 cents on the dollar. Many
states like Virginia and Carolinas issued over 200 million dollars of their own currency. The paper money
became a hidden tax on people. That was the only form of taxation during that time. Inflation grew and few
people had fixed incomes. 90 percent of the people were farmers and weren’t directly affected by inflation.
Debtors benefited by paying off their debts with depreciated paper. The soldiers of the Continental Army
had lower wages. Their families had hardships too.

By 1776, the Congress raised money by loans from the wealthy. They promised to redeem the bonds after
the war. The bonds were redeemed in 1791 at face value. Yet, it raised little money since Americans had little
specie. Many rich merchants supported the Crown. France secretly supplied Americans money, gunpowder,
and munitions in order to fight England as early as 1776. France officially came into the war by 1778. The
subsidies from France continued. The French government, bankers in Paris, and bankers in Amsterdam
loaned large sums of money to the Revolutionary War on the American side. These loans were repaid in full
by the 1790’s. In 1777, Congress asked the states to provide money.

Many states had no taxation system. Little states could help out. Congress in 1780 was making requisitions
for specific supplies of corn, beef, pork, and other necessities. It was an inefficient system that kept the army
barely alive. The cities played a major role in causing the American Revolution. Yet, these cities were hit hard
by the war. Many lost their oceanic ports, because of the blockade by the British Navy. The British once
occupied the cities, especially New York City from 1776 to 1783. They or the Redcoats occupied other cities
for shorter periods of time. During the occupations, the cities were cut off from their hinterland trade and
from overland communities. The British left in 1783. Many of them took a large number of wealthy
merchants who resumed their business activities elsewhere in the British Empire.

The new nation of America grew. The U.S. Constitution was adopted in 1787. The nation was unified with a
common market and no internal tariffs or taxes on interstate commerce. The problem was that many black
people were slaves back then and Native Americans were oppressed (which on how America’s wealth was
built upon. America’s wealth was built on the backs of black people and the indigenous peoples of the
Americas). Disgracefully, women were second class citizens and deprived of basic human rights. Alexander
Hamilton was a financial innovator in America. He was the first Secretary of Treasury during the Presidential
administration of George Washington. Hamilton wanted an increase role of the federal government to invest
in roads, bridges, canals, etc. He promoted the implied powers which meant powers not overtly mentioned
in the Constitution. Yet, these powers still legally applied to everyday life. For example, a specific road is not
mentioned in the Constitution, but Hamilton wanted the government to fund the building of that road via
Congress if desired. Jefferson was the opposite in wanting a weaker national government. Hamilton made a
strong national credit. He took over the state debts, bundled them with the old national debt into new
securities and sold it to the wealthy. This had an interesting action in keeping the new government solvent.
He used tariffs on imported goods and a tax on whiskey to fund the debt. Hamilton wanted economic
growth via diversified shipping, manufacturing, and banking. History has proven Alexander Hamilton
correct, because a strong economy must have manufacturing, technology, shipping, and other
resources, which makes up a powerful infrastructure. He supported the First Bank of the United States in
1791 and its charter lasted until 1811.

After the Revolutionary War, older cities restored their economic basis. New cities like Salem, Massachusetts
(which traded with China), New London, Connecticut, and Baltimore, Maryland grew. Local banks flourished
in cities. Peace came. Then, Britain and France fought each other again in 1793. America was neutral in doing
business to both sides. France hated this and the Quasi War from 1798 to 1799 disrupted trade. Outraged at
British impositions on American merchant ships, and sailors, the Jefferson and Madison administrations
engaged in economic warfare with Britain from 1807-1812, and then full-scale warfare from 1812 to 1815.
This was called the War of 1812. Americans were angry of British navy ships also kidnapping American
sailors. By this time, the Federalists wanted to fund a strong national government and the Republicans didn’t.
The National Bank charter ended in 1811, but problems existed. State banks couldn’t operate across state
lines. During this time, over 120 new state banks were created all over the country and they issued notes
that financed much of the war effort, along with loans raised by Washington. The economy of the USA grew
from 1812 to 1815 despite loss of business among East Coast shipping interests. Canals, flour mills, and
textile manufacturing increased in America. The cotton gin made cotton production quickly and it increased
slavery in the South as cotton was a major crop in the South. It was innovated by Eli Whitney. It removed the
seeds faster. Numerous scholars believe that Eli Whitney's invention extended slavery for many more
decades into the future in America. Cotton was shipped to New England, Britain, and France.
 The American System
There was the American System promoted by Alexander Hamilton and others. Alexander Hamilton believed
in the creation of a government-sponsored bank and increased tariffs to encourage industrial development.
He died by Aaron Burr in a duel. The American System was promoted by Henry Clay and the Whig Party.
Exploration, canals, and telegraphs expanded the American economy. Thomas Jefferson and James Madison
didn’t want a strong central government. Jefferson wanted small farmers to dominate the economic system
of America in a decentralized fashion. Thomas Jefferson envisioned a nation of agrarian farmers. Madison
allowed the Second Bank of the United States in 1816. The Louisiana Territory purchase in 1803 (being worth
$15 million) doubled the size of America. Yet, it continued the Manifest Density of many who viewed the
Native Americans as less than human (which is wrong). The role of the Federal Government in regulating
interstate commerce was firmly established by the landmark Supreme Court ruling in Gibbons v Ogden,
which decided against allowing states to grant exclusive rights to steamboat companies operating between
states.

Andrew Jackson like Jefferson believed in a small federal government. Andrew Jackson (who is Donald
Trump's hero) opposed the Second Bank of the United States. Jackson accused the bank of benefiting the
rich, but Jackson was a person who oppressed Native Americans and was a hardened racist. He ended the
Second Bank’s renewal of its charter. He even opposed paper money and wanted the government to be paid
in gold and silver coins. This cause panic and the Panic of 1837 stopped business growth for three years.
Economic expansion existed along with the growth of the population of America by the 19th century. During
the early 1800’s, new cities grew like Pittsburgh, Marietta, Cincinnati, Louisville, Lexington, Nashville, etc.
Early 19th century economy in America was mostly agricultural. By the mid-19th century, there was a
transition to industrialization, especially in the Northeast. The Southern economy was based on plantations,
agriculture, tobacco, cotton, sugar (which was produced by slave labor). The abolitionist activists and black
heroes fought to end slavery. The increase of railroad system in America (in places like Atlanta, Billings,
Chicago, and Dallas) developed America’s infrastructure.
 Slavery and the Civil War
The Panic of 1857 existed too. The American Civil War ended much of the economy of the South. The Civil
War existed, because of slavery, disputes among the North and the South, economic issues, etc. The Civil
War ultimately devastated the South. Ironically, the U.S. Civil War increased the industrialization of the North.
During the 19th century, the North had a diversified economy with farms and industry. Free workers were
heavily found in the North too. The Southern economy relied heavily on slave labor during the antebellum
period. Abraham Lincoln was elected President in 1860. Southern states seceded and the Confederate attack
on Fort Sumter (in South Carolina on April 12, 1861) started the Civil War in America. The South has many
military leaders and the North had a larger population, better transportation, greater resources, and more
factories. The Northern victory make America more industrialized. Industrialists came to dominate many
areas of American life. Taxes and government bonds funded the Union during the Civil War. The U.S.
Treasury Secretary Salmon P. Chase used ingenuity in financing the war (a valued added tax imposed on
manufactured items) without crippling the economy of the Union. Chase made it easy to become a national
bank; it involved buying and holding federal bonds and financiers rushed to open these banks. Chase
numbered them, so that the first one in each city was the "First National Bank.” Additionally, the government
printed "greenbacks"—paper money—which were controversial because they caused inflation. The tariff act
of 1862 served not only to raise revenue, but also to encourage the establishment of factories free from
British competition by taxing British imports.

Furthermore, it promoted American factory workers over low paid European workers. This reality attracted
tens of thousands of those Europeans to immigrate to America for high wage factory and craftsman jobs.
Many Homestead Acts were used for people to buy lands for cheap in return to do housing, farming, and
planting trees. Many grants during the 1850’s benefited colleges and universities. The North’s national banks
executed currency for industrial expansion. Thaddeus Stevens and other Republicans wanted tariffs, bonds,
income and excise taxes, national banks, and suppression of money issued by state banks, greenback
currency, and western railroad land grants. The Civil War experienced new organizational methods,
engineering skills, and increased businesses. The Civil War and the Union victory caused slavery to end,
which was great as slavery is evil. Black people and other people sacrificed their lives, so the Union would
achieve victory. We honor the sacrifice of the Union heroes.
 Mid-19th Century Developments
One of the greatest aspects of economic history was the events of labor strikes. There can be no economic
progress comprehensively without labor rights and economic rights in general. These rights benefit both
workers and employers. Our rights didn’t come about by the willingness of the oligarchy. Our rights were
created by activism, demands, and resistance against oppression. In 1834, people in a mill in Lowell,
Massachusetts protested to protest against wage cuts. They created a union of working class women. The
women wanted fair wages. There was a strike for a week. A second strike existed in 1836 and in 1840. Later,
the women formed the Lowell Female Labor Reform Association to try to reduce the workday to 10 hours.
They used an 1845 petition, they organized chapters, and they wanted the Massachusetts state legislature to
cap the work day in the mills at 10 hours. By 1847, New Hampshire became the first state to pass a 10 hour
workday law, but it wasn’t enforceable. These events were part of the long struggle for workers' rights. The
Industrial Revolution grew from this time. It was movement where people came from the farms and into
factories for economic opportunities. Factories made large production with machines involving steam power
or coal. The problems in the Industrial Revolution were the corruption found in this movement like child
labor, bad working conditions, workers' exploitation, etc. Economic inequality grew along with economic
growth for the leaders of large corporations. Neoclassical economics develop. New economic philosophers
during the 19th century include Marshall, Pareto, Jevons, Walras, and other economic scholars.

One of the most important parts of economic history dealt with the views of Karl Marx during the 19th
century. He was an economist, a historian, a political theorist, a sociologist, and a journalist. He held onto
revolutionary views and offered some of the strongest criticisms of capitalism in human history. He studied
Hegelian philosophy and worked with German thinker Friedrich Engels. He is known for his 1848 pamphlet
called the Communist Manifesto and his three volume work called Das Kaptial. In essence, Karl Marx believed
that the social realities involving human beings consist of a class struggle. He believed that capitalism
permitted the ruling class or the bourgeoisie to control the means of production (which lead the working
class or the proletariat to suffer exploitation and other forms of harm). He believed in historical materialism
and desired that the only way to create more harmony economically was for the working class to overthrow
the ruling class in a means to establish economic justice. Historical materialism relates to Marxism. It is a
theory of history that material conditions of society in dealing with producing and reproduction of human
existence determine the organization and development of society. Marx wanted the working class to use
revolutionary action to end capitalism. He was a journalist and he regularly worked in London. Karl Marx was
right to criticize the imperfections of capitalism. Karl Marx was wrong to make many immature and very
vicious words against some people via letters and on other issues.

Life during the late 19th Century

By the late 19th century, the growth of Austrian Economics existed. Austrian Economics believed that
individuals can use the market to make the economic systems of the world grow without a lot of
government intervention. Much of the conservative or libertarian economic views today existed from
Austrian Economics. It promotes marginalist and neoclassical thought, which defended capitalism. Some of
the early defenders of Austrian economics included Menger, von Wieser, and Hayek. Hayek was a person
whom conservatives to this day revere. He was an advocate of free markets. He falsely believed that
government intervention to achieve economic egalitarianism was equivalent to totalitarianism. Libertarianism
believes that that the individuals can control his or her own body, but the government should never
intervene in the economy except in rare instances. The problem with as little government involvement in the
economy as possible is that liberty isn’t about people doing what you want (i.e. human beings are restricted
to not do murder, unjust violence, etc. as murder and unjust violence are morally wrong).

Liberty is about freedom bounded under justice, so the rights of the oppressed or the minorities including
everyone else are protected by government intervention too. That is why governments exist in order to fight
evil and promote the good. Morality and justice aren’t mutually exclusive. They go hand in hand since
fighting slavery, discrimination, abuse, and other moral evils (via both social activism and government
intervention) will establish justice for all. Ludwig Mises and Friedrich Hayek influenced the Libertarian
movement. I believe in helping the poor and social justice. By the late 19th century in America, immigration
grew heavily. From 1865 to 1918, millions of immigrants came into the United States in about 27.5 million
people. These people were Jewish people, Italians, Russians, Irish, Germans, Central Europeans, Caribbeans,
Africans, the Chinese, etc. Many of them were exploited economically by numerous corporate interests.
Many of these immigrants experienced discrimination and bigotry. Some faced workers’ exploitation, but
they persisted to establish great, positive contributions in American society. Also, the government used
policies of Homesteads and other actions that benefited these new immigrants. In the meantime, black
people experienced Reconstruction and the white racist backlash of it (which dealt with lynching, Jim Crow,
and other evils). Still, courageous black people back then formed unions, associations, and civil rights groups
to combat the tyranny of racial oppression. Mary Harris Jones worked as a labor organizer in 1871 after the
Great Chicago Fire. The Paris Commune of 1871 in Paris denoted the power of socialist activism in Europe.

More strikes existed from the Haymarket strike in Chicago to other events. The Gilded Age occurred during
the late 19th century in America. It was about the growth of technology and immigration along with many
economic scandals flourishing. The Gilded Age saw further industrial growth, but continued bad conditions
of working condition problems and lax wages existed as well during that era. Numerous people were
crowded in tenements (in large cities) filled with horrendous conditions. The Transcontinental railroad, the
telegraph, and expansion of wealth in America still primarily benefited a select few during the Gilded Age.
Economic corruption grew. Monopolists like Andrew Carnegie, J.P. Morgan, and John D. Rockefeller owned
vast resources in oil, banking, etc. The Civil Service Act, the Interstate Commerce Act, the Sherman Antitrust
Act, etc. tried to combat monopolies in business. During that era of time (from 1865-1890's), there was the
Jim Crow apartheid system in the South plus in the Midwest, the continued genocide of Native Americans
(like in the Wounded Knee Massacre), and further U.S. annexation of areas in the globe. Also, it is important
to acknowledge the working class heroes who fought against the evils found in the Gilded Age. The 1878
Great Uprising was about railroad workers fighting economic rights and real benefits. State authorities killed
many of them during this historic uprising. Eugene V. Debs was another leader of the labor rights movement
and he was a socialist. The Haymarket event of 1886, the Homestead strike of 1892, and the Pullman strike in
1894 showed determined workers desiring true equality and justice.

The Populist movement grew to fight monopolies, defend farmers, and advance labor rights. Many leaders
of this movement changed to be racists as time went onward. Others in this movement were among people
of many colors who desired real change. Labor unions grew too. The Panic of 1893 caused a national
depression. Many railroads were bankrupt. Farmers, workers, and businessmen suffered price drops, wage
declined, and profits falling. McKinley (who promoted the Gold Standard) won by 1900 and the economy
grew. Likewise, he saw the American Empire develop into the next level after the Spanish American war and
the various annexations by America. Imperialism is wrong, because imperialism revolves around other
nations dominating another group of people via exploitation, violation of human democratic rights, and
other nefarious motivations. During this time, the Progressive era was in existence during its beginning. The
Progressive era was about activists who wanted to eliminate conditions of poverty, corruption, and other
evils in urban communities. They were diverse. Some were progressive people and some weren’t. Some of
them even advanced the evil of eugenics. Labor groups, civil rights groups, and suffrage groups by the end
of the 19th century continued to fight for freedom. The next part of this economic series will deal with
the events from 1900 to 1945.

By Timothy
Upcoming Works that are coming in the Spring and
the Summer of 2018

Tennis 1968 Baseball The 15th Year

Anniversary of the
Iraq War

The History of the Modern Art 50 Years After the Miriam Makeba
United States of Assassination of
America Robert Kennedy

“The way to right wrongs is to turn the light of truth upon

them.”
-Ida B. Wells
We desire justice and liberation like always.