Wealth concentration is the single most enduring economic pattern across all polities from ancient Mesopotamia to the present. Wealth stratification appears to be coterminous with complex human civilisation, persisting across modes of production and constitutional arrangements, with and without social mobility. Membership at the top may fluctuate, but there is always a top.1
Natural variation between individuals cannot account for the patterns and sheer scale of these material disparities. Nor can it explain why, despite the existence of humans possessing different faculties for at least 100,000 years, durable inequality first arose much more recently. Rank inequality in achievement-based village societies appeared about 9,000 years ago, while hereditary inequality developed a little over 7,000 years ago. It took a further 1,500 years for extreme wealth stratification to become firmly established, in Mesopotamia.2 New opportunities for wealth accumulation (i.e. sedentary farming) combined with effective strategies for wealth defence (i.e. clans, lineages and intra-group coercion) permitted durable material stratification, which has marked nearly all human communities ever since.
While necessary for the emergence of wealth inequality, sedentary agriculture was probably not sufficient. It took generations of experimenting with social structures of domination and material exclusion to discover which ones were defensible. There were two key pathways to wealth stratification: the temple and the lineage group (these often intersected). Convincing followers that material inequalities were linked to and legitimised by deities was fairly straightforward, and from Sumer forward, temple managers (usually a family enterprise) held great wealth in land and agricultural labour. A greater challenge was constructing capacities for domination by the family, clan or lineage. This required promoting an ideology that inequality was hereditary rather than individual.3 Hereditary dominance, linked initially to the cosmos and to ancestor veneration, provided the crucial social instrument for the transgenerational privilege that distinguishes humans from other social animals. This, in turn, set the stage for the rise of the institutions and structures needed to sustain durable wealth stratification.
Wealth arises upon the first successful claim to exclusive, and then concentrated, control over scarce resources desired by others. Whether appropriated from nature or produced from labour, economic surpluses do not lead to wealth stratification until a part of the community can effectively withhold resources from the rest. Sustaining extreme material inequality thus requires deliberate and active strategies of wealth defence by the rich.
The accumulation and defence of wealth has been an often violent process, centred on the establishment and policing of boundaries—that is, the imposition by an emergent elite of territorial and transactional constraints on subordinates.4 The earliest human rulers were too weak to impose territorial boundaries, making durable wealth inequality impossible and their polities ephemeral and small. Riches on a grand scale developed only after chiefly societies ‘converted war to a strategy of territorial expansion’, permanently subjugating neighbouring provinces, incorporating them within established boundaries and systematically demanding their products as tribute.5 This ever tightening nexus of violence, territory and people was simultaneously the source of property, concentrated wealth, complex states and expansive empires.
Connected by relations of power, changes in political structures unfolded in tandem with evolving strategies of wealth defence. To bring the story forward to the present, the analytical challenge is to trace how changes in the form and organisation of force converted the violence unleashed by aggrandising groups into its softer cousin, coercion, which allowed legal principles and institutions enjoying considerable legitimacy to predominate. It was this revolutionary transition that permitted, for the first time in history, the holders of great fortunes to be securely defended and yet personally unarmed. How did we get from the paramount chief and lineage, to the medieval lord, to the colonial company, and finally to the impersonal state? And what remains of wealth defence today?
From direct to impersonal rule
Historically, wealth defence has been the responsibility either of rich individuals acting alone, or of rich individuals acting in concert, or of an impersonal state apparatus. This crucial variation led to two contrasting modes of wealth defence: personal (or direct) and impersonal (or indirect). These distinct modes operated, in turn, through different different defensive strategies, ranging from raids and extortion conducted personally by oligarchs to protection rackets (backed by regularised violence, or ‘coercion’) once an impersonal mode of wealth defence was established. Let’s unpack this a bit.
As the actor responsible for wealth defence shifted from individual to group to state, the rich were increasingly disarmed and less likely to govern directly. In the process, wealth in the form of tribute was converted from plunder to extortion to taxation; while the use of force for wealth defence was transformed from naked violence into legitimate coercion—a transformation that could happen only if the enforcement function at the heart of property defence moved out of the hands of wealth holders themselves. This facilitated an important ideological shift away from viewing the rich and the rulers as one and the same thing; the partly separate, partly overlapping realms of the political and the economic were created.6
To understand these transitions we must begin by distinguishing the extraction of resources through raids from extraction through providing protection, with extortion as a mid-point along the way (not discussed in detail here). Both raids and protection involve the use of threats and force by dominant actors focused on wealth. But ‘unlike the nomadic predators who, in the past, raided the neighbouring settlements to collect tribute but never constructively interfered with the local order of life’, ‘conquerors who established permanent rule had to protect their dominion and increase economic returns from it to enhance protective capacity’.7 Part of being able to create bounded spaces and territorial definition involved the decidedly interventionist project of protection rackets pursued by warrior nobles and aristocrats. Oligarchic raiders were increasingly replaced by elites who demanded regular tribute from a permanently subjected population within fixed territorial boundaries, in exchange for protection from both themselves and from other oligarchs—tribute that in time came to be called taxation.
Two factors drove early oligarchs from raiding to protection and thus from direct to impersonal rule. First was the need for disarmament to prevent constant inter-oligarchic conflict. Direct rule by rich actors who are armed can be either fragmented and atomistic or collective. But rarely do all powerful groups and actors paddle the boat in the same direction. A constant danger and source of disorder was that armed oligarchs frequently turned on each other. When ‘private parties provide their own defences, wealth and violence go hand in hand’.8 Stable collective rule by oligarchs required that they be at least partially disarmed when in close proximity, such as gathered in the capital or a senate chamber.9
Second was the need to invest oligarchic rule with greater legitimacy to reduce the costs of wealth defence. Legitimacy, custom, and authority are important for building stable and scaled-up systems of wealth defence that rely more on coercion than violence. While tremendous military force is indispensable in establishing bounded political units and amassing wealth, the constant use of violence is expensive, risky, and usually unpleasant for everyone involved.10 By replacing violence done by individuals with rule-bound coercion done by institutions, impersonal state structures gain a degree of legitimacy and authority that enables oligarchs to distance themselves from grubbier and more expensive forms of wealth defence.
It is important to realise, however, that the violence never disappeared. ‘Coercion is violence deferred. It is removed but only temporarily, as long as the subject of coercion displays behaviour conforming to the pattern set by the wielder of force’.11 No display of conforming behaviour was more important to wealth defence than a respect for property, which during the rise of absolutist states in early modern Europe fully metamorphosed from self-enforced claims to state-enforced rights.
The eventual monopoly of force over a bounded territory and population, and the subtraction of direct violence from the wealth defence toolkit of the rich, was a boon to oligarchs. They no longer had to make major personal or business expenditures on armaments, castles, moats, militia, and costly alliances and marriages. Coercion and violence would always constitute the firmament of all property and wealth. But the rise of the bureaucratic tax state opened new opportunities for off-loading the wealth defence costs of property protection and enforcement to strata further down the wealth ladder. The challenge going in to the modern period was to accomplish this oligarchic goal in the context of increasingly democratic politics, which incorporated certain institutions and practices reflecting earlier oligarchic victories, but also posed novel threats. The case of the United States from the late 1700s to the early 2000s, discussed in Part 2 of this essay, offers important insights into how the tension between political equality and extreme material stratification has been managed.
This is an edited excerpt from a forthcoming article by Jeffrey Winters in a special issue of the journal NOMOS devoted to the topic of wealth.
Top image: Claude Vignon, 'Croesus receiving tribute from a Libyan peasant' (1629).
Jeffrey A. Winters is professor of politics and director of the Equality Development and Globalisation Studies (EDGS) program at Northwestern University.
1 Or, almost always. Twentieth century regimes in the Soviet Union and Eastern Europe, Communist China, Vietnam, Cambodia, Cuba, and others, constituted partial exceptions, albeit short-lived ones. In every case, ultra-wealthy oligarchs have re-emerged at a stunning pace and on a remarkable scale. This phenomenon was examined at the ‘Workshop on Oligarchic Formation’, The Social Sciences Program, Centre for Public Policy Transformation, Jakarta, in cooperation with Northwestern University’s Equality Development and Globalisation Studies (EDGS) program. June 19-20, 2014.
2 Kent Flannery and Joyce Marcus, The Creation of Inequality: How Our Prehistoric Ancestors Set the Stage for Monarchy, Slavery, and Empire (Cambridge: Harvard UP, 2012), p. 551.
3 Ibid., p. 563.
4 See Patricia Urban, Edward Schortman and Marne Ausec, ‘Power without bounds? Middle preclassic political developments in the Naco Valley, Honduras’, Latin American Antiquity 13.2 (2002), p. 131.
5 Flannery and Marcus, Creation of Inequality, p. 210.
6 The pioneering work of Frederic Lane and the later elaborations of his insights by Vadim Volkov are particularly helpful for understanding these transitions. See: Vadim Volkov, ‘The political economy of protection rackets in the past and the present’, Social Research 67.3 (2000), pp. 709-744; Vadim Volkov, Violent Entrepreneurs: The Use of Force in the Making of Russian Capitalism (Ithaca: Cornell UP, 2002); Frederic C. Lane, ‘Oceanic expansion: force and enterprise in the creation of oceanic commerce’, The Journal of Economic History 10 (1950), Supplement: The Tasks of Economic History, pp. 19-31; Frederic C. Lane, ‘Economic consequences of organised violence’, The Journal of Economic History 18.4 (1958), pp. 401-417; Frederic C. Lane, ‘The economic meaning of war and protection’, in Venice and History: The Collected Papers of Frederic C. Lane (Baltimore: The Johns Hopkins Press, 1966).
7 Volkov, ‘Protection rackets’, p. 713.
8 Robert Bates, Avner Greif and Smita Singh, ‘Organising violence’, Journal of Conflict Resolution 46.5 (2002), p. 603.
9 These variations are developed more fully in the discussion of warring, ruling, sultanistic, and civil oligarchies in Jeffrey A. Winters, Oligarchy (Cambridge: Cambridge UP, 2011), pp. 32-36 and passim).
10 ‘Restraint in rulers is essential to the exercise of power; delegation of authority is otherwise impossible’; ‘if only for reasons of economy, rulers like to be loved’. John Lonsdale, ‘States and social processes in Africa: a historiographical survey’, African Studies Review 24.2/3 (1981), Social Science and Humanistic Research on Africa: An Assessment (June-September), p. 160.
11 Volkov, ‘Protection rackets’, p. 817.