Author: Walter Scheidel
Source: The New York Times
Date: April 9, 2020
The coronavirus, like other plagues before it, could shift the balance between rich and poor.
Mr. Scheidel is a professor of classics and history at Stanford University.
In the fall of 1347, rat fleas carrying bubonic plague entered Italy on a few ships from the Black Sea. Over the next four years, a pandemic tore through Europe and the Middle East. Panic spread, as the lymph nodes in victims’ armpits and groins swelled into buboes, black blisters covered their bodies, fevers soared and organs failed. Perhaps a third of Europe’s people perished.
Giovanni Boccaccio’s “Decameron” offers an eyewitness account: “When all the graves were full, huge trenches were excavated in the churchyards, into which new arrivals were placed in their hundreds, stowed tier upon tier like ships’ cargo.” According to Agnolo di Tura of Siena, “so many died that all believed it was the end of the world.”
And yet this was only the beginning. The plague returned a mere decade later and periodic flare-ups continued for a century and a half, thinning out several generations in a row. Because of this “destructive plague which devastated nations and caused populations to vanish,” the Arab historian Ibn Khaldun wrote, “the entire inhabited world changed.”
The wealthy found some of these changes alarming. In the words of an anonymous English chronicler, “Such a shortage of laborers ensued that the humble turned up their noses at employment, and could scarcely be persuaded to serve the eminent for triple wages.” Influential employers, such as large landowners, lobbied the English crown to pass the Ordinance of Laborers, which informed workers that they were “obliged to accept the employment offered” for the same measly wages as before.
But as successive waves of plague shrunk the work force, hired hands and tenants “took no notice of the king’s command,” as the Augustinian clergyman Henry Knighton complained. “If anyone wanted to hire them he had to submit to their demands, for either his fruit and standing corn would be lost or he had to pander to the arrogance and greed of the workers.”
As a result of this shift in the balance between labor and capital, we now know, thanks to painstaking research by economic historians, that real incomes of unskilled workers doubled across much of Europe within a few decades. According to tax records that have survived in the archives of many Italian towns, wealth inequality in most of these places plummeted. In England, workers ate and drank better than they did before the plague and even wore fancy furs that used to be reserved for their betters. At the same time, higher wages and lower rents squeezed landlords, many of whom failed to hold on to their inherited privilege. Before long, there were fewer lords and knights, endowed with smaller fortunes, than there had been when the plague first struck.
But these outcomes were not a given. For centuries and indeed millenniums, great plagues and other severe shocks have shaped political preferences and decision-making by those in charge. The policy choices that result determine whether inequality rises or falls in response to such calamities. And history teaches us that these choices can change societies in very different ways.
Looking at the historical record across Europe during the late Middle Ages, we see that elites did not readily cede ground, even under extreme pressure after a pandemic. During the Great Rising of England’s peasants in 1381, workers demanded, among other things, the right to freely negotiate labor contracts. Nobles and their armed levies put down the revolt by force, in an attempt to coerce people to defer to the old order. But the last vestiges of feudal obligations soon faded. Workers could hold out for better wages, and landlords and employers broke ranks with each other to compete for scarce labor.
Elsewhere, however, repression carried the day. In late medieval Eastern Europe, from Prussia and Poland to Russia, nobles colluded to impose serfdom on their peasantries to lock down a depleted labor force. This altered the long-term economic outcomes for the entire region: Free labor and thriving cities drove modernization in western Europe, but in the eastern periphery, development fell behind.
Farther south, the Mamluks of Egypt, a regime of foreign conquerors of Turkic origin, maintained a united front to keep their tight control over the land and continue exploiting the peasantry. The Mamluks forced the dwindling subject population to hand over the same rent payments, in cash and kind, as before the plague. This strategy sent the economy into a tailspin as farmers revolted or abandoned their fields.
But more often than not, repression failed. The first known plague pandemic in Europe and the Middle East, which started in 541, provides the earliest example. Anticipating the English Ordinance of Laborers by 800 years, the Byzantine emperor Justinian railed against scarce workers who “demand double and triple wages and salaries, in violation of ancient customs” and forbade them “to yield to the detestable passion of avarice” — to charge market wages for their labor. The doubling or tripling of real incomes reported on papyrus documents from the Byzantine province of Egypt leaves no doubt that his decree fell on deaf ears.
In the Americas, Spain’s conquistadores faced similar challenges. In what was the most horrific pandemic in all of history, unleashed as soon as Columbus made landfall in the Caribbean, smallpox and measles decimated Indigenous societies across the Western Hemisphere. The conquistadores’ advance was expedited by this devastation, and the invaders swiftly rewarded themselves with enormous estates and whole villages of peons. For a while, heavy-handed enforcement of wage controls set by the Viceroyalty of New Spain kept the surviving workers from reaping any benefits from the growing labor shortage. But when labor markets were finally opened up after 1600, real wages in central Mexico tripled.
None of these stories had a happy ending for the masses. When population numbers recovered after the plague of Justinian, the Black Death and the American pandemics, wages slid downward and elites were firmly back in control. Colonial Latin America went on to produce some of the most extreme inequalities on record. In most European societies, disparities in income and wealth rose for four centuries all the way up to the eve of World War I. It was only then that a new great wave of catastrophic upheavals undermined the established order, and economic inequality dropped to lows not witnessed since the Black Death, if not the fall of the Roman Empire.
In looking for illumination from the past on our current pandemic, we must be wary of superficial analogies. Even in the worst-case scenario, Covid-19 will kill a far smaller share of the world’s population than any of these earlier disasters did, and it will touch the active work force and the next generation even more lightly. Labor won’t become scarce enough to drive up wages, nor will the value of real estate plummet. And our economies no longer rely on farmland and manual labor.
Yet the most important lesson of history endures. The impact of any pandemic goes well beyond lives lost and commerce curtailed. Today, America faces a fundamental choice between defending the status quo and embracing progressive change. The current crisis could prompt redistributive reforms akin to those triggered by the Great Depression and World War II, unless entrenched interests prove too powerful to overcome.