The ancient Greeks used quantitative easing

What can they teach us?

Quantitative easing is fast becoming common parlance given the Bank of England’s £375bn programme, so it was with enjoyment that I recently read up on some of the history of QE in Schroders’s Dialogue newsletter.

Paraphrasing Philip Coggan at the Secular Market Forum, the article clarified that QE is, despite the media hysteria, nothing new. "2,500 years ago Dionysius of Syracuse called in all coins from his populace on pain of death, re-stamped all the one drachma coins as two drachma, returned the face value of all the money he had seized to his people and used the remainder to pay off his debts."

Startling as the stunt may have been, it gave future leaders inspiration. "Following the reign of Louis XIV at the start of the 18th century," the article runs, "the French monarchy was essentially bankrupt and so turned to a Scottish mathematician, gambler and economist called John Law to come up with a way of paying off the huge debts.

"He did this through a scheme that involved the creation of a joint-stock company, the Compagnie d’Occident, to exploit France’s colonial possessions, and by creating extra money with which to buy shares in the company and keep their value rising." Little surprise that "the scheme became one of the greatest bubbles in history and failed."

So where does the historic tale of woe leave the West?  According to Coggan, author of Paper Promises: Money, Debt and the New World Order, (which won a Spear's Book Award last year) facing the unholy trinity of inflate, stagnate or default.

"Japan has taken the stagnate option over the past 20 years and remains a prosperous place," the article says. "But importantly, its debt is internal whereas Europe’s debt is cross border so creditors will tend to force change rather than kicking the can down the road.

"Due to the fixed exchange rate system, Europe also cannot inflate or devalue, which means default is the only viable option of the three."

Alarming stuff – so let’s hope that Coggan’s history is better than his predicting.

This article originally appeared in Spear's magazine. Read more from Freddy Barker.

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Bomb Isil? That's exactly what they want

The government appears not to answer the nature of its enemy, warns Maria Norris.

As MPs are set to vote on further airstrikes in Syria, it is difficult to shake off the feeling that the government does not fully appreciate the complexity of the problem Isil poses. Just a cursory glance at its magazine, the pronouncements of its leaders and its ideology reveals that Isil is desperate for Western bombs to fall out of the sky. As Martin Chulov argues, Isil is fighting a war it believes was preordained since the early days of Islam. Isil’s obsession with the city of Dabiq, in Northern Syria, stems from a hadith which prophesises that the ‘Crusader’ army will land in the city as a precursor to a final battle where Islam will emerge victorious. Dabiq is also the name of its magazine, which starts every issue with the same quote: "The spark has been lit here in Iraq, and its heat will continue to intensify -- by Allah's permission -- until it burns the crusader armies in Dabiq". Isil wants a war with the West. If we don’t negotiate with terrorists, then we also should not give them what they want.

Further, bombs are indiscriminate and will inevitably lead to the suffering of those trapped in Isil territories. Isil is counting on this suffering to swell their ranks. Civilian suffering from airstrikes only underline the narrative that the West is at war with Islam, which plays directly into Isil’s hands. And despite misleading headlines and the genuine government concern with individuals fleeing to Syria, Isis is supremely unpopular. It is no wonder that its magazine is filled with glossy adds begging people to move to its territories.  You cannot be a state without people. Terrorist attacks such as Paris thus have a two-pronged purpose: they provoke the West to respond with its military, and they act as a recruitment drive. The fact that fake Syrian passports were found around the sites of the Paris attacks is no coincidence as Isil are both seeking to stem the flow of refugees from its territories and hoping to provoke an Islamophobic backlash. They hope that, as more Muslims feel alienated in the West, more will join them, not just as fighters, but as the doctors, nurses and teachers it desperately needs.

In addition to this, airstrikes overlook the fact that Isil is a result of what Fawaz Gerges calls a severe, organic institutional crisis in the Middle East. In a lecture at the London School of Economics earlier this year, Gerges pointed out the dysfunction created when a region that is incredibly resource rich also is also deeply undemocratic, riddled with corruption, food insecurity, unemployment and poverty. This forms an institutional vacuum that is filled by non-state actors as the population does not trust its political structures. Further, the civil war in Syria is also the site of the toxic soup of Middle Eastern state dysfunction. Iran supports Assad, Saudi Arabia and the Gulf countries, fund anti-Shia groups in Syria. Throw in the Kurdish conflict, Turkey’s ambiguous position and Russian bombs, it is difficult to see how airstrikes will solve anything.

Finally, it is crucial that Isil is seen as a direct result of the Iraq war. The American-led invasion destroyed the institutions, giving the Shia majority power almost overnight, creating deep dissatisfaction in the Sunni regions of Iraq. On top of this thousands of foreign fighters flooded Iraq to fight the invaders, attracting disenfranchised and angry Sunnis. The result is that since 2003, Iraq has been embroiled in a sectarian civil war.  It is in civil war, inherently connected to the Iraq War, that you find the roots of Isil. As even the Prime Minister concedes that ground troops are necessary, albeit it regional ground troops with its own set of problems, it is important to consider what further monster can arise from the ashes of another ill-thought out military intervention in the Middle East.
We have had decades of military intervention in the Middle East with disastrous consequences. Airstrikes represent business as usual, when what we actually need is a radically new approach. Who is funding Isil? Who is buying its oil? How to curb Isil’s recruitment drives? What can be done about the refugees? How to end the conflict in Syria? What happens to Assad? These are questions hopefully being addressed in talks recently held in Vienna with Russian, Ira, the USA, France, Syria’s neighbours and the Gulf states. Airstrikes do not answer any of these questions. What airstrikes do is give Isil exactly what it is asking for. Surely this is reason enough not to bomb Syria. 

Maria W. Norris is a PhD candidate and a teacher at the London School of Economics and Political Science. Her PhD is on the UK counter-terrorism strategy since 9/11 and its relationship with identity. She tweets as @MariaWNorris.