Origins: Filthy Lucre

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For more than 30 years now, people have been singing along to the rock band Pink Floyd’s song “Money,” which bemoans our monetized existence: “Money, so they say / Is the root of all evil today. / But if you ask for a raise it’s no surprise that they’re giving none away.”

Indeed, few moments go by when we are not thinking about money, worrying about money, wishing we had more money. Not surprisingly, money even plays a prominent role in some of the Western world’s earliest literature. One of the plays by the Greek comedian Aristophanes (c. 448–388 B.C.), for example, is titled Ploutos (Wealth) and has some lines that are almost indistinguishable from those in Pink Floyd’s “Money.” Blepsidemus, the protagonist’s friend, for example, complains that “there’s no trace of goodness in anyone; the lust for profit rules the world.”

Although Aristophanes’ generation used money more or less as we do, that had not been the case for very long. Only a century and a half earlier, in the mid-sixth century B.C., did small stamped pieces of precious metal begin to circulate around the Aegean as money. The extraordinary usefulness of this invention is apparent in how quickly the idea spread. Soon, most of the Greek-speaking world was using coins, and then so were peoples in North Africa, the Levant and elsewhere.

With the invention of coinage, wealth was no longer calculated solely by the possession of land, livestock or goods; wealth now included accumulated value, condensed in coins and earned through work and trade. Coin-based wealth helped to fuel the growth of markets, which in turn brought new commodities and social possibilities to individual households. Eventually, the entire Mediterranean world came to see the usefulness of money and incorporated it as a normal part of everyday life—which most of us can’t imagine doing without (for better or worse).

This is not to say that the ancients did not engage in trade until the invention of money. They did, and the forms of trade were varied. People then, as now, engaged in simple barter, in which one set of goods was exchanged for another. Some exchanged their labor for desired goods, a form of work or indentured servitude. Some peoples invented a system in which precious materials (gold, silver, ostrich shells, and so on) were used as a medium of exchange.

Of these forms of exchange only the latter is a primitive form of money—which is really more of a concept than a thing. Today, for example, money often simply consists of numbers on a piece of paper or computer screen. Modern coins (or, obviously, credit cards) have little value in themselves; we have agreed as a society to give them value as a convention, because we are convinced that such a form of exchange is useful. (The fact that money is just a convention becomes painfully obvious during times of political unrest, when the old forms of exchange suddenly collapse and lose all their value.) What makes money really and completely money is the fact that there is no necessary link between the value of the money-object (a $100 bill, say) and the value of that object itself (a rectangular piece of colored paper). But this system required much time and many steps to evolve, and money in the meantime acquired many different forms.

In the ancient Near East, weighed pieces of silver came to be recognized as an early form of money, much as cowrie shells did in various other parts of the world. The monetary system that evolved around the use of 007these cut-up bits of silver, which are called Hacksilber by scholars, was in use centuries before the introduction of coinage in the late seventh century B.C. The evidence for this type of money is found in several hoards of Hacksilber that have surfaced in the Levant and elsewhere, as well as in textual sources. For example, the Semitic verbal root TQL (Hebrew SQL), meaning “to weigh, be heavy,” gives the Hebrew noun form “shekel,” which in the Hebrew Bible is a defined weight of Hacksilber. For example, the Lord instructs Moses to collect a tax of half a shekel of silver from each Israelite who is 20 years old or older (Exodus 30:13).

Near Eastern practices unquestionably influenced the use of silver as a monetary instrument in the Aegean. The basic weight-denominational system used by the Greeks was likely borrowed from the Hacksilber-using Phoenicians around the time that the Greeks borrowed the Phoenician alphabet for their own use (eighth century B.C.). These weight-denominations included the mina (in Athens about 15 ounces of silver or 100 local drachmas) and the talent (56 pounds of silver, the equivalent of 60 mina or 6,000 drachmas).

Whether those living in and around the Aegean used Hacksilber extensively before the introduction of coinage is a matter of controversy. What is not disputed, however, is that towards the end of the seventh century B.C., the Lydians of western Turkey minted the first coins. The Lydians made their coins out of electrum, a naturally occurring alloy of gold and silver that was panned from the Pactolos river, not far from the capital city of Sardis. (Our epithet “rich as Croesus” refers to the Lydian king Croesus, who ruled from Sardis in the sixth century B.C.; Croesus was no doubt rich because of all the electrum at his disposal.) Because gold was worth at least ten times more than silver, and because the ratio of the gold and silver in the electrum varied, no one could ever be entirely certain how much a particular piece of electrum was worth. By putting its official stamp on a pre-weighed piece of electrum, the Lydian state guaranteed the value of coins. These coins, however, did not circulate widely, and for a while coinage remained an isolated Lydian phenomenon.

The next step in the evolution of money came in the early sixth century B.C. when the Lydians abandoned electrum coinage in favor of pure gold and silver coins. These coins were a kind of pre-weighed and guaranteed Hacksilber, and they served as a solution to the problem of determining the value of any given amount of electrum. About the time that Sardis fell to the Persians (546 B.C.), the Greeks were awakening to the possibilities of the Lydian invention. From a practical standpoint, coins improved the efficiency and flexibility of the developing market trade by allowing, for example, buyers and sellers simply to count out their money rather than to weigh it for every transaction. Also, by guaranteeing the quality and weight of the coins in circulation, the state picked up the burden of trust in the currency that markets rely upon to operate smoothly.

After the seventh century B.C., interaction among far-flung Greek cities became much more intense. New festivals and competitions began to be celebrated, bringing together the Greek-speaking peoples. New ideas were in the air about the nature of man, politics and society. Many Greek cities overthrew their tyrants and replaced them with power-sharing governments. In fifth-century Athens, the new government was a radical democracy that gave political voice to the lowliest of male citizens. Because the spread of coinage took place at precisely the same moment as many of these social and political developments, it is tempting to see a correlation: Just as democracy was a political equalizer, coinage was an economic equalizer, putting the power of money into the hands of people who stood outside the traditional avenues of social advancement and wealth. Family ties and landholding mattered less in the new order than commercial acumen, which is a definite means of social mobility. Even the fungibility of coinage (meaning that one coin was exactly like another and could be exchanged for anything else) added a dimension of equality to money.

Not too long after coinage spread into Greece, many Greeks were using coinage exclusively as their preferred form of money, and more traditional types of transactions—like barter—were supplanted by those based on coins. The coin-based economy brought with it new attitudes towards wealth, work, commodities and, of course, money. It was a world-changing transformation that has made possible our fast-paced modern life, in which billions of transactions are made every day across all kinds of markets, languages and cultures.

For more than 30 years now, people have been singing along to the rock band Pink Floyd’s song “Money,” which bemoans our monetized existence: “Money, so they say / Is the root of all evil today. / But if you ask for a raise it’s no surprise that they’re giving none away.” Indeed, few moments go by when we are not thinking about money, worrying about money, wishing we had more money. Not surprisingly, money even plays a prominent role in some of the Western world’s earliest literature. One of the plays by the Greek comedian Aristophanes (c. 448–388 […]