Last week there was an interesting article in the FT linking the current state of the global economy to what happened in Britain in the year 410. In that year Rome was sacked, no one could be bothered to defend Britain any longer and the barbarians descended upon lowland Britain. What followed is an interesting pointer to our possible future. At that time Britain benefited from a sophisticated Roman economy. There was coinage in 3 metals – gold, silver & copper that drove the economy as well as a well established trade infrastructure bringing goods from all over Europe into Britain. In the first decade of the 5th century new coins ceased to reach Britain, local attempts to produce a new version failed, so from around 420AD, Britain’s economy functioned without coin for nearly 300 years. Core manufacturing declined and failed and at the level of pure functional articles such as iron pots and wheel spun earthen ware pottery, disappeared altogether from Britain. The only pots remaining were shaped by hand and fired not in kilns but on open fires. The impact on Britain was enormous. Roman Britain had a dense network of towns, ranging from large ones like London & Cirencester to small commercial centres that had grown up along the roads and waterways. By 450 most of these had either disappeared or were well on their way to extinction. It was only in the 8th century with the (re)emergence of trading towns such as London and Saxon Southampton, that urban life began to return to Britain.
For two to three hundred years the economy of Britain reverted to levels not experienced since the Roman invasion in 43 AD. It was the speed of the crash that is the lesson. In southern Britain before the Roman invasion there was a reasonably sophisticated economy with locally produced silver coins, wheel turned pottery vessels and the beginning of settlements recognised as towns, but the local expertise disappeared as the more sophisticated Roman trade and economy took over. It wasnt until 1000 or 1100 AD that Britain crawled back to levels of economic complexity that they had enjoyed in Roman times.
Why does this matter to us? The speed and the scale of the collapse in Britain was because of the sophistication of the Roman trade and economic system. All the goods enjoyed for basic well-being were often made by specialist producers many miles away and these producers relied on widespread markets and distribution systems to sustain their specialised production. In the 5th century all of this collapsed leaving a population without the goods that they wanted and without the skills and infrastructure needed to produce them locally. The more complex the economy is the more fragile it is. Consider that in our economy, most of the goods are largely produced on the other side of the world and our main medium of economic exchange is mostly electronic and more importantly sometimes based on ‘smoke and mirrors’.
If our global economy ever truly collapses the consequences will make 5th century Britain look like a picnic.