I’m taking a break from watching Aetius attempt to envelop Attila in the famous battle of Chalons (thanks to the History Channel’s excellent Decisive Battles series) in order to blog another discovery in my reading of a new volume of Mesopotamian history.
Historians of government and political economy have often pointed to Hammurabi’s Code as early evidence of government’s tendency to grow beyond its proper bounds. I can understand why. It is full of laws, regulations, and taxes. But a more careful reading will reveal that, while it is by no means the legal code of a night-watchman state — after all, the hydraulic theory of government formation in this cradle of human civilization reveals that the need to organize large-scale irrigation of the Tigris and Euphrates rivers played a critical role in the creation of the state — neither is it fair to think of Hammurabi’s Babylonia as some kind of proto-socialist regime.
For one thing, there is increasing evidence of significant private enterprise throughout the kingdom. Previously, archaeologists and historians had thought that the royal and temple lands had dominated economic life. But Mesopotamian merchants appear to have traveled far and wide, along the way inventing a kind of joint-stock company in which investors could buy what amounted to “shares” in the profits. There are thousands upon thousands of tablets preserving business contracts in cuneiform.
For another, Hammurabi’s regulations are extensive but not particularly onerous. For example, they imposed caps on interest rates and punished violators. But the upper bound was typically 33 1/3 percent (presumably an annual rate), allowing a great deal of room for market-rate lending to go on. Such a high cap suggests that the real target was probably fraudulent lenders, not the practice of “usury” per se.
