In the 1530’s the Spanish, led by conquistador Pizarro, arrived in Peru. In their search for gold they devastated the Inca civilization, destroyed it’s culture, and killed its leaders. Spain as it was flooded with gold became the wealthiest country in the world. The gold, entering through government coffers should have enriched Spain. Unfortunately, with unlimited amounts of spending money, manufacturing and production at home decreased and importation skyrocketed. In 1580, Inca Garcilaso de la Vega–son of a Spanish conqueror and an Inca princess–lamented the situation in Spain:
“. . . these riches had proven more harmful than beneficial since they had given rise to vice rather than virtue; inclining men to pride, ambition, gluttony, and luxury. For while enjoying an affluence of fortune, they had waxed so lazy and effeminate as to be unfit for governing in time of peace, or for enduring the exigencies and toils of war. All their time and thoughts now were employed in contriving new dishes to appease their appetites, or new and fantastic fashions to flatter their vanities. And in this last passion they attained such a climax of extravagance that they scarcely knew what to wear, and had reached such a state of indecency in dress that their apparel was more like that of a woman than a man. And sadder still was the fact that to support such lusts and conceits, the revenues of the exalted had been increased while the poor were being reduced to rags and starvation. Indeed with the accumulation of wealth among the powerful, the needy had become even more destitute than previously because of the resultant rise in the cost of commodities and provisions. Thus the poor were being starved by the very abundance of the rich. For even though the latter were able to increase their alms, their gifts were still insufficient to meet the high cost of living which an excess of wealth had raised in the world. It was apparent, therefore to men capable of understanding, that since the wealth derived from the New World had failed to provide materials necessary for support of human life, but instead made them more dear, and since this wealth rendered men more effeminate by enfeebling them in both body and understanding, and by debauching them in their habits and manner of living, mankind as a whole had become more degenerate and less content.”
Today we are not on the gold standard. Instead our government spends and prints money without limits. But are we, the wealthiest country in the world, better off as our spending increases? Ae we more virtuous, are we more generous, are we more thoughtful, more productive? Has unfettered spending improved our lives, raised the employment rates, or lowered our costs of living? Has it made us happier, strengthened our families or our nation?
As limitless gold did in Spain, limitless spending here will cause inflation and impoverish us as a people spiritually and financially.