Attacks on a state’s economy can inflict immense damage, but sanctions and other tools of economic warfare are unlikely to defeat a superior military power. Instead, economic disruptions may prompt the state to fight even harder to defend itself. The anger and anxiety economic disruptions produce can accelerate rather than conclude a war.
A failed economic assault on ancient Rome offers a window into the possibilities and perils of this strategy.
This ancient case study begins in the late summer of 89 BC, when Mithridates VI of Pontus—the ruler of a medium-sized kingdom along the southern Black Sea coast (present-day northeastern Turkey)—declared war on Rome. The trigger had been a Roman ally’s recent raid on Pontus.
At the time, the Roman state extended from the Atlantic Ocean to modern Turkey, but its power was rooted in Italy. Mithridates lacked the military capacity to invade Italy or directly attack the city of Rome. Instead, the king decided to damage the Roman heartland indirectly by attacking buffer states that separated his realm from the Roman provinces along the Aegean coast, before breaking through into Roman territory outside Italy. Through these attacks, he sought to turn allied states against Rome, and disrupt the Roman economy.
Mithridates’ strategy unfolded across 88 BC. As his armies swept through Roman Asia Minor, they captured Roman officials, seized cities, and confiscated the local treasuries that supported the Roman regime. Then, once he had secured these lands, Mithridates sent out a letter that was received as an order to kill Roman businessmen, tax collectors, and government contractors whose fortunes depended on the Roman government’s activities in the region.
“With that one letter,” the rhetorician Valerius Maximus would later write, “he killed 80,000 Roman citizens, businessmen who were spread throughout the cities in Asia.” Other sources count as many as 150,000 Roman men, women, and children living in the cities and towns of Asia Minor who were rounded up and killed by people acting on Mithridates’ orders.
Forces loyal to Mithridates also attacked the Athenian island of Delos, the most important commercial port linking Italy with the Greek world. The geographer Strabo wrote that traders engaged in the import-export business “favored Delos,” but “it was frequented by Romans more than any other people.” The geographer Pausanias recorded Mithridates’ forces “put[ting] to death the foreigners residing” on the island before “plundering much of the property belonging to the traders.”
These attacks suggest that Mithridates targeted Roman business and commercial interests in order to chill the financial relationships that linked Rome to its provinces in the Eastern Mediterranean. All these murders of Romans abroad instilled fear—and also represented a direct assault on the economy of the Roman homeland.
First century Rome possessed an extremely sophisticated financial sector in which credit flowed easily, and wealthy people based much of their fortunes on their holdings of nomina, creditor notes that functioned like modern bonds. Romans could hold, sell, or exchange nomina with one another or cash them out, facilitated by bankers working in the Roman Forum.
This Roman financial system depended upon bankers correctly estimating the credit risk of individual debtors so that they could accurately price the loans they held or sold. This process worked well under normal conditions. But Mithridates murdered so many tax collectors, contractors, and traders based in Asia Minor and Delos that the nomina tied to business activities there lost all of their value at once. The sophistication of the Roman financial sector compounded the damage because these suddenly worthless nomina had been sold to investors, used as collateral to buy houses, and served to capitalize Roman banks. Massive amounts of wealth disappeared from Roman banks, investors, and property owners overnight.
The Roman economy crashed. In a speech delivered in 66 BC, Cicero recalled how “very many people lost large fortunes in Asia … there was a collapse in credit at Rome, because repayments were interrupted. Indeed, it is not possible for so many people in one state to lose their property and fortunes without the result that many others are dragged into the same calamity with them.” The historian Philip Kay has compared the financial crisis Mithridates caused to the subprime mortgage crisis in the U.S.
But unlike the 2008 U.S. financial crisis, Rome’s public finances collapsed alongside its private wealth thanks to Mithridates’ economic warfare. Tax revenue collected by Roman contractors in Asia paid for the distribution of subsidized grain to Roman citizens, one of the few public welfare programs the Republic provided. With Asia occupied by Mithridates and Rome’s tax collectors murdered, the Roman poor faced a sudden disruption to the funds that ensured their food supply. Such a desperate sense of panic fell upon the city that a mob murdered one of Rome’s chief judicial magistrates when he tried to mediate a dispute between lenders and debtors.
Rome struggled to respond to this economic crisis. Its leaders introduced emergency measures to restrict the amount of debt lenders could take on and to compel lenders to renegotiate loans that could not be repaid. Rome also injected capital into the economy by minting large numbers of silver coins, some of which were made from bullion borrowed by the state from the treasuries of Roman temples as an emergency measure.
None of this worked particularly well. Then, as Roman anxiety and anger rose, the great commanders Marius and Sulla pushed Rome into a civil war sparked by an argument over who would lead the army against Mithridates.
It is hard to imagine Mithridates’ economic attack inflicting greater damage on the Republic. Yet ultimately, this economic war failed to defeat Rome. And it would end up in disaster for Mithridates.
Few Romans would have known the name Mithridates before 88 BC. But once Mithridates directly affected the life of every Roman citizen, the Republic had no choice but to pour their resources into his defeat. The Republic fought on, pushing back Mithridates from Roman territory and forcing him to sign a peace treaty in 84 BC.
Rome fought two more wars with Mithridates until 63 BC, when his own son betrayed him, and the old king killed himself so he could avoid being paraded through the city of Rome in a triumphal procession.
That would have been the only way Mithridates ever reached Rome.