Plagues & Changes in Economics – The Hunt for Taxes

QUESTION: Mr. Armstrong; I assume you have studied this hunt for money government goes through. Has it always ended in the collapse of government?
Thank you
PD
ANSWER: No. It really depends upon the economic system in place. There are two comparable Plagues which devastated the world population. One ended in oppression and the other gave birth to capitalism. It is like the battle between Public and Private. It depends in which side you reside when it hits. In a Public Wave we have taxes rising to compensate for the decline in population whereas in the latter, we find the birth of taxation applied to individuals who suddenly are free to earn money.
One of the worst such events took place coinciding withe Justinian Plague (541-542AD) was a pandemic involving Yersinia pestis, the organism responsible for bubonic plague. This hit the known population on a monumental scale creating a wave of devastation comparable to the Black Death which came about 600+ years later (2 x 309.6) which created capitalism by killing about 50% of the people and ended serfdom reintroduction wages during the 14th century. It is estimated that about 25 million were impacted on its first wave but recurrences struck bringing the total death total to perhaps 50 million. The primary source describing this as a worldwide event in history has come to us from the noted contemporary historian during the 6th century Procopius of Caesarea (Procopius Caesarensis; c. 500-560AD).

The Justinian Plague (541–542AD) resulted in 5,000 people died per day in Constantinople but the Emperor responded with massive taxation as the pestilence swept through the whole known world and notably the Roman Empire. Justinian is remembered for his legal code reforms, but also for massive taxation for having tried to restore the fallen glory of ancient Rome by waging a series of military campaigns to retake lands that had been overrun by barbarian tribes. The Plague wiped out most of the farming community and this impacted the tax revenue of the government. It was taxation that was different from the Black Death. Here, taxation was applied to individuals whereas during latter taxes were minimal and applied to only landlords. Justinian showed no mercy whatsoever when it came to the collapse in his tax revenue. Despite the human desolation, Justinian hunted the ruined freeholders. He not only demanded they pay his annual tax even if they had no income, but he increased the tax on those living to compensate for also the amount of taxation their deceased neighbors were liable.
Justinian I was rather ruthless when it came to taxation. There was a tax revolt that boiled over on January 13th, 532AD, known as the Nika Revolt, which emerged when an angry populace arrived at the Hippodrome in Constantinople to watch the chariot races. The Hippodrome was next to the palace complex where Justinian could watch from the safety of the Palace. The spectators were hurling insults at Justinian for his taxes. Initially, it was a contest between two opposing teams known as the “Blue” and “Green”. After race 22, the chants began to change to Nίκα (“Nika”, meaning “Win!” or “Conquer!”). The crowds became violent and for the next five days, the palace was under siege. They set fires which destroyed most of the city including the church, the Hagia Sophia, which Justinian would impose harsh taxes to later rebuild.
Therefore, in this instance, Justinian I raised taxes on the 50% who survived so his revenue would not decline. Since this was a period of capitalism which individuals earned money for their labor (socialism/communism the state earns the profit from the labor of the population), then taxes were raised on the people. The Black Death ended serfdom as labor became scarce and landlords had to offer more than 20% of the food and a free house to live in to work their land.
https://www.armstrongeconomics.com/world-news/taxes/plagues-changes-in-economics-the-hunt-for-taxes/