every civilization.

Through the ages, in one civilization after another, the glaring
contrast between riches and poverty has appeared, dividing the community
and laying the foundation for class struggle and class war, both of
which decrease social efficiency, intensify class antagonism.

In the early stages of any culture cycle, barter is replaced by a money
economy. Money is a medium of exchange, usually issued by a public
authority and used in daily transactions, to pay tribute or taxes and to
meet other general expenses. In its earlier forms it is made of
relatively scarce materials that are in general demand, limited in
supply and easily divisible into smaller units. Gold, silver and other
metals meet these requirements and have been used as money through the
ages.

Cash money and promises to pay speed up wholesale and retail exchanges
in the market place. They fill the bill in normal times. But there are
emergencies and other exceptions. One of the commonest of the
emergencies is war.

In a previous chapter we pointed out that war is a characteristic
feature of a civilization that has passed the top-point of its expansion
and begun to decline. Then the chickens come home to roost. Civil war,
colonial wars and wars between imperial rivals follow each other,
creating emergencies in which demand for certain strategic goods and
services rises steeply, with no corresponding increase in supply. Prices
increase. The common defense requires immediate purchase of supplies.
The public treasury is exhausted. The government borrows from money
lenders (bankers). It also prints paper money and puts it in
circulation.

If the credit of the government is good, if the emergency is of short
duration, matters right themselves and the economy survives without
serious derangements. But war-emergency disrupts and sometimes destroys
an economy. This outcome often results from military defeat.

Another exception to normal economic transactions is buying on
credit--buying today and paying tomorrow. The temporary gap between
purchase and payment is filled by credit--a promise of the purchaser to
pay later and the confidence of the seller that the bill will be paid.
Such credit transactions are covered by notes, bonds and mortgages made
out by the buyer and accepted by the seller. Until the debt is settled,
the borrower pays the seller interest at an agreed rate. Bankers enter
the picture, providing capital and collecting interest on