All Fires the Fire: the Multiverse of Economics

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THE LOTS WERE CAST. IN FOURTH-CENTURY ROME, INFLATION WAS SUCKING THE ECONOMY DOWN THE DRAIN. NOW PRICES ROSE FROM INERTIA. "SINCE EVERYBODY ELSE IS UPPING THEIR PRICES, I HAVE TO TOO," THOUGHT EACH AND EVERY BUSINESSMAN. AND SO EVERYBODY RAISED THEIR PRICES FOR FEAR THAT EVERYBODY ELSE WOULD RAISE THEIRS.

The solution? "Prohibit price hikes," someone in the government proposed. This in fact seemed like the most logical thing to do. And it's what happened. They began freezing prices.

In Brazil, under the Sarney administration, inflation was sucking the economy down the drain. Now prices rose from inertia. "Since everybody else is upping their prices, I have to too," thought each and every businessman. And so everybody raised their prices for fear that everybody else would raise theirs.

The solution? "Prohibit price hikes," someone in the government proposed. This in fact seemed like the most logical thing to do. And it's what happened. They began freezing prices.

In Rome, the first step was to draw up a table of maximum prices, which would be engraved in stone and placed in the commercial centers of the Empire's major cities. Nobody could increase prices on the listed products anymore. The government introduced this table in the form of an edict – a speech written by Emperor Diocletian in 301 A.D. to be read before the public. It was a proclamation that revealed a good deal about the nature of political speeches too: it's one of the most demagogic pieces of work that has survived to tell us its story.

True to the era's customs, the edict opened with the Emperor presenting his credentials as the supreme chief of the galaxy, all of which were attached to his name:

Imperator Caesar Caius Aurelius Galerius Diocletianus Pius Felix Invictus Augustus Pontifex Maximums Germanicus Maximus VI Sarmaticus Maximus IIII Persicux Maximus II Britanicus Maximus Carpicus Maximus Armenicus Maximus Medicus Maximus Adiabenicus Maximus Tribunicia potestate XVIII Consul VII Imperator XVIII Pater Patriae Proconsul.

The edict then stated that:

As we remember from the wars that we have successfully fought, we must be grateful for our State's good fortune, which is second only to that of the immortal gods. We are grateful for a peaceful world, which reposes in the arms of the utmost tranquility, and for the blessing of a peace won through great effort. . . .And for these reasons, we must protect the peace we have established through the defense of justice."

After all this yadi yadi yadda, the Pontifex Maximus fingered those who were "truly guilty" for the rising prices. If some brake could be put on the excesses committed by incalculably greedy people, if some brake could be put on this avarice of pursuing profits with no thoughts to humanity, the situation might be handled in silence. But the wishes of these unrestrained madmen ran counter to public needs.

These "unrestrained madmen" were businessmen, since they were the ones raising prices. Of course the ones who were really to blame for inflation were the Emperor himself and his predecessors, since they were the ones minting new coins. But Diocletian wasn't about to admit to this. After incriminating his selected villains, the emperor focused on what mattered to him: his table of top prices. "It would be most delightful if the prices listed on these tables were observed throughout the Empire," he said in the edict.

Frozen. Everything was frozen. The table established the maximum prices for 900 goods and 130 services (mason, teacher, water bearer, attorney, and so on). For those who didn't agree: the death penalty. The axe also fell on those who showed off their wealth. If you wore clothes made of purple silk (the priciest cloth, imported from the farthest East), you'd be decapitated, unless you managed to talk the Emperor into giving you his personal authorization to wear the most distinguished of fabrics. And man, was it distinguished: a purple silk outfit cost 150,000 denarii. With this much money, you could buy 3,750 500-ml amphorae of virgin olive oil (at 40 denarii each, according to the table). Converting into today's prices, with a bottle of extra-virgin olive oil going for $10, we can figure that this get-up went for $37,500 – say, about the same as a Hermes Birkin bag or an haute couture dress by Dior. The second-priciest article of clothing – made from white silk – cost 12,000 denarii, or $3,000. Nice suit. Conclusion: the distance between the rich and the ridiculously rich was about the same as today, even back then, when there was a paltry variety of products available. In other words, doing whatever it takes to show that you're above the riff-raff has never gone out of style.

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