There’s a lot we can learn from ancient Athens. The Greek city-state, best recognized as the first democracy in the world, is thought to have laid the foundation for modern political and philosophical theory, providing a model of government that has endured, albeit in revised form. Needless to say, the uniqueness of its political institutions shaped many of its economic principles and practices, many of which are still recognizable in current systems of government. Today, in a global environment of economic turmoil, ancient Athens may be even more relevant that ever before, imparting a handful of lessons for today’s citizens of the world.
1. Freelancing is the best way of life.
No Athenian citizen had a full-time job. It was beneath their dignity to work for someone else. Nearly all citizens had a farm so they would spend some time working there, but few farms produced a saleable surplus and most people had to buy much of their food. They might be called up for a military or naval campaign, which would bring in a little money. They got paid if they attended the assembly, though it only met a few days per month. They could also get paid if they were selected by lot to sit on a 500-person jury, but this was necessarily sporadic. To make ends meet, most people turned to manufacturing, making simple objects for their own use, for exchange with neighbours, or for sale in the marketplace. Besides the freedom to spend time philosophising, attending festivals, and going to the theatre, this flexible lifestyle allowed citizens to attend to their formal democratic responsibilities in the assembly and in the courts. It is what enabled Athens’ democracy and her justice system to function in a way we can only envy.
2. Casual manufacturing is a good way to supplement your income.
Before the industrial revolution, most manufacturing was done in small craft shops by a handful of people. There were only a few ways to build a large business, essentially through branding a product that required more than one person to make, or through pre-empting a valuable location, like a mine access point for ore processing or a permitted site for tanning. The industrial revolution brought cost and information benefits to those who could invest in large-scale operations, and in developed economies the small craftsman almost disappeared. New technology is changing that dynamic again and eliminating the advantages of scale on every front, from online apprenticeships and 3D printing to desktop CNC machinery and sales and promotion. The effort involved in making things for self or for sale is once again competitive with shop prices, and casual manufacturing can form a satisfying and financially important part of a freelance portfolio.
3. You don’t need business regulation to enforce community standards.
The Athenians had a very strong belief in fairness and justice—so strong it enabled them to dispense with business regulations. If you made a contract, you were expected to abide by it. Anyone who felt aggrieved by the actions of an associate could bring a legal case and it would be judged by 500 of his fellow citizens, selected by lot. The judges were not concerned with legal interpretations and precedents, just with who seemed believable and what seemed fair.
4. You can finance public goods without an income tax system.
The Athenians had no income tax system yet managed to pay for a lot of public goods, far more than could be afforded out of the state’s main sources of revenues, which were harbour taxes, mine leases, and protection money from its allies. They also believed it was important that public goods should be paid for by those who could best afford it. To achieve this, they developed a system of donations or “liturgies” ensuring that costs fell on rich Athenians, who might be asked to fund a boat, a festival, or an unexpected military contingency.
If you were selected for a liturgy, there were two ways of getting out of it. You could show you had made one recently—which could be easily checked—or you could point to someone richer than you and say they should do it. There was one catch: you had to offer to swap all your assets for theirs, so you would want to be sure you were right.
5. The public has a right to know exactly how its money is spent.
The Athenians had a very clear system of accountability for public projects. They were approved by a democratically elected council and the general assembly, and the task of supervising delivery and costs was assigned to a representative body of citizens to whom the “architect” (project manager) would report. There were no attempts to claim that contracts were commercially confidential and full details were published. Inscriptions on stones near temples carried the names of everyone who worked on the project, their social status, and details of what they did, how many days they worked, and what they were paid. Another inscription by the city walls giving detailed financial records says it was prepared for “anyone who wants to know how the finances were managed.”
Image Credit: “Odeon of Herodes Atticus, Athens, Greece. 2003” by black.stllettos. CC BY-NC-ND 2.0. via Flickr
The article casually mentions “protection money from allies” as one source of Athenian public revenues that avoided the need for an income tax. No one who has read Thucydides will be eager to substitute this approach for an income tax.
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