Pertinax attempted with limited success to restrain government spending. In his famous work, Roman History, Dio labeled him “an excellent and upright man,” who practiced “not only humaneness and integrity in the imperial administrations, but also the most economical management and the most careful consideration for the public welfare.” To his credit, he set about to clean up the mess his predecessor created. A senator and former military man, Pertinax assumed the imperial purple on the first day of a tumultuous twelve months. The resulting price inflation was a reason the Roman historian Cassius Dio lamented the reign of Commodus as a descent “from a kingdom of gold to one of iron and rust.” To the joy and relief of most Roman citizens, conspirators, including his own wife, assassinated Commodus on New Year’s Eve 192.Įnter Pertinax and 193, known as the Year of the Five Emperors. Perhaps the numbers seem insignificant, but these two devaluations were Rome’s largest since Nero nearly a century and a half before. Six years later, he diluted it further to 74 percent. In 180 A.D., Commodus reduced the size of the principal Roman coin, the denarius, and cut its silver content from 79 percent to 76 percent. Ranking among his many public sins are taxes and tortures, both of which he increased notably during his fifteen-year reign. Rome’s emperor is a hated brute and megalomaniac by the name of Commodus ( depicted by actor Joaquin Phoenix in Gladiator). An ancient Roman emperor named Pertinax, he was born on this very date-August 1-in the year 126 A.D.įast forward to December 31 in 192. My purpose in this essay, however, is to acquaint readers with one of the few exceptions-a leader who briefly stopped the policy of debasement and strengthened his country’s currency. Political leaders are happy to cowardly defer real reform to some future generation and, in the meantime, do nothing more than “manage” the decline. This familiar pattern in monetary history rarely produces any heroes. The last time the federal government affirmed sound money was with enactment of the Gold Standard Act of 1900 or, even more dramatically, with the formal end of Civil War paper money inflation in 1875. Ronald Reagan was perhaps the only one to at least raise the issue-he even created a commission to explore the options for restoring a gold standard-but nothing ever came of it. No American president since William McKinley did anything to reverse this debauchery. Then in 1971, Richard Nixon ended the last, tenuous link between the currency and a precious metal by refusing to honor foreign claims on the dollar in gold. Under Lyndon Johnson in the 1960s, the silver content of the country’s coinage was removed.

In 1933, Franklin Roosevelt ordered American citizens to turn over their monetary gold to the government or face fines and imprisonment. It also created a central bank that would go on to cause the Great Depression and a string of recessions as it steadily inflated away at least 90 percent of the dollar’s 1913 value. In December of that year, he signed into law the Federal Reserve Act, which reduced the paper dollar’s “gold cover” to 40 percent. The dollar was “as good as gold” when Woodrow Wilson commenced America’s monetary deterioration in 1913. It's a sad story that dates back at least as far as the prophet Isaiah, who condemned his ancient Israelite compatriots for turning their silver coinage into “dross.” ( See Isaiah 1:22.) History records countless examples of currency debasement, i.e., the steady reduction in a money’s precious metal content or “backing” (principally gold or silver), followed in modern times by the introduction of fiat (unbacked) paper money, which then depreciates as governments print more and more of it to buy votes, run budget deficits, and spend like tomorrow doesn’t matter.

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