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|Subject: Re: S&P500 distribution of returns||Date: 9/21/2013 4:59 PM|
|Author: sykesix||Number: 73138 of 75627|
I appreciate your hopeful POV, Ray, but the current era of the United States is different. Even Rome, the most magnificent era in human history, didn't last.
Are we like Rome yet?
What follows is wildly off topic, and has no retirement investing content.
When people talk about the fall of Rome, they often confuse or otherwise mix up two different events: The fall of the Roman Republic, and the fall of the Roman Empire. Those two things happened about 500 years apart and had very different causes.
Stossel did the same thing in the video, pointing to Marius' election as Consul six times in a row, in contradiction of Roman tradition, if not the Roman constitution. That was indeed one of the things that happened leading up to the fall of the Roman Republic. However the Roman Empire lasted about another 500 years after that. <vast oversimplification follows> Prior to Marius, only citizens served in the Roman Army. Citizens in turn were from the noble classes and represented only a small portion of the population. Marius opened enlistment to everyone, and offered citizenship to anyone who served for ten years. The size of the Roman army surged, and Marius made other major military reforms as well as being a great general, winning many great battles, and therefore become personally wealthy and hugely popular in his later life as a politician. As consul, his popularity allowed Marius to avoid the traditional term limits and he also instituted many populist reforms. A side effect of this however is that Roman armies became loyal to their leaders, not to Roman itself.
Marius' ex-quaestor Sulla took the Roman army off on a campaign, become wealthy through plunder (and of course his men got a cut), came back to Rome and overthrew Marius' government in a military coup. Sulla appointed himself dictator, killed the political opposition as well as lots of wealthy people (using the money to pay his men), undid all of Marius' populist reforms, re-established the old form of government, and retired. A few years later, Julius Ceasar copied Sulla's model of using the military to capture the government, but skipped the retiring part and the Republic became an Empire. I mention Marius because Stossell did. There were lots of other big players in the whole thing too.
At its peak the Roman Empire was larger and more powerful than the Republic ever was but went into a long period of gradual decline, in part due <vast oversimplification follows> to incompetent leadership, civil war, and inability to deal with outside military threats. However it is not clear when the Empire actually ended (depends on how you define it), and the Eastern Roman Empire (which they just called the "Roman Empire" back then) lasted until the 1400s.
So if you are viewing America as the Roman Republic, then our best days of wealth and power are still to come. If you are viewing America as the Roman Empire, then we'll be fading away slowly over the next 400-500 years. Or if you view it as I do, it's not that great of an analogy. Still, lots of lessons to be learned in there. Sulla and Caesar using the army to capture the government is the reason why the President of the United States is also the commander-in-chief of the military.
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