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The S&l Debacle

April 2023
1min read

John Steele Gordon states that Elizabethan goldsmiths became the first to issue paper money. I understand that the Chinese invented paper money centuries before. According to The Horizon History of China , bankers and money shops issued drafts payable at the capital during the Tang period. During the Sung dynasty in 1024, paper money was issued with government approval and backing.

Mr. Gordon replies: I’m afraid that Mr. Brown has caught me with my Eurocentrism showing. The Chinese did indeed first invent paper money, several hundred years before it appeared in Europe. Alas, it also disappeared from China several hundred years before it appeared in Europe.

The Chinese invented any number of things first, coke-fired blast furnaces and oceangoing cargo ships, for instance. But many of them later vanished because of opposition from the government establishment or in some subsequent era of political chaos. They had no long-term consequences for China or the world, unlike the European re invention of these same things.

So crediting the goldsmiths rather than the Chinese with inventing paper money is rather like crediting Columbus with the European discovery of America. Sure, Leif Ericson got here first, but so what?

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