From Slavery to Xanadu: The Wealth of the Mongol Empire

Using The Secret History of the Mongols as a primary source (likely written by Genghis’ adoptive son Sigi-quduqu) This paper will follow, from Genghis’ birth, to see how the family rises from a “single family household” to the first global superpower in which land and horses are the predominant form of wealth of the empire. This will also include subsequent organization and growth of the empire by: sons Toloui and Ogadai; and grandsons Guyuk, Mongke, and Hulagu and finally the unification of the east and first truly global economy under Kublai, with his institution of paper money, the jaichao. Though it was not perfect, it was a bold and visionary move that left a mark on history.

Much of what is known about the Mongolian Empire started by Genghis Kahn was discovered peripherally. Where the Mongolians went they were like a plague of locust who would lay waste to entire populations. In the final chapters of Edward Gibbon’s Decline and Fall of the Roman Empire he writes about the comparative importance and understanding of other empires, mentioning the Greeks, Turks, Ottomans and then goes on to say:

They are founded on the previous knowledge of the great eruption of the Moguls (Mongols) and Tartars, whose rapid conquests may be compared with the primitive convulsions of nature, which have agitated and altered the surface of the globe… Our European battles, says a philosopher [Voltaire], are petty skirmishes, if compared to the numbers that have fought and fallen in the fields of Asia.

Temujin, but better known now as Genghis Khan, lived a life that seemed to have been fire as an arrow, full speed from the moment of his birth in 1162. There was bitter political fighting going on in his region, and he was raised in this lifestyle that is nearly modern in speed, but completely ancient in both ritual and violence. The currency of the land was horse and food trading. Before Temujin’s rise to power, he would be captured by his father’s enemies to be kept as a slave, and it is upon his escape that he get’s one of his first big historical break’s” when he would meet one of his strongest allies, who would be considered among Genghis’ best friend, a wealthy Horse trader’s Son, Bogorchu. The would spend their lives together as friends and allies, securing a wealthy backing to begin his conqests.

When Genghis’s dies in 1227 the art of war, politics, and empire building had been upended completely and replaced with the newer Mongolian Model of speed and destruction. If you base your calculation of wealth on the value of land control/ownership, when Genghis Khan died he was the richest person in History (4,000,000 km2 or 1,500,000 sq mi, at the height of the empire) and readjust to the world market standard USD value, it yields a total of 100 trillion dollars.

The east and west were now connected like never before, through the Hungarian steppe with express riders traveling 150 kilometers a day, where the nomadic generals would meet and share information. During this time Beijing, though not defeated, was left abandoned by the Jin empire’s leadership in North China and Russia was primed for invasion as well. Genghis Khan felt that he was ordained by god to cover the earth with his people and he did exactly that by killing the men who would fight against him (and many who didn’t), raping the women, enslaving the children, and then inviting the remaining people into partnerships, an offer they couldn’t refuse… and for all this fear and destruction, the empire would grow evermore, faraway countries would come offering alms that they might be spared. The bonds were strong and the Fiefdom was a resilient one filled with strong and capable warriors as heirs of Genghis.

After conquering a place, Genghis Khan and the Mongol Empire were good about inducting talent and new ideas into his own lexicon of success. A wonderful example of this is a man Chu-Tsai, a Giant by any conventional standards (standing 6’8”) Governor of North China who worked for Genghis Khan as a chancery (tax and laws book keeper) despite having previously worked for one of Genghis’ rivals, the Jin Emperor. He (Chu-Tsai) would spend many years attempting to reign in Kublai’s uncle, Ogadai’s dreadful drinking and spending habits, recommending a more reserved life instead. Going as far as suggesting, that Ogadai should nurture and tax the poor, rather than razing them along with the crops to make room for horse pasture. Implemented in 1230, this method of taxation produced 10,000 silver ingots ad likely spared many lives, a revolutionary idea for the time. Genghis is succeeded by Ogadai “whose kingdom was won on horseback, could not be governed there” said Chu-Tsai.

It wasn’t long after these taxation rights are distributed throughout the various Khanates of the family and into the Islamic territories that the power is in the hands of somebody other than the gentle (for the times) Chu-Tsai, and it’s estimated that around this time more than half of the population decides to flee rather than face those who would tax up to 100% of their harvest. Gentle is unquestionably a relative term, it is suspected that the destruction brought on by the Mongolian empire in the 1200s reduced the population of the Eurasian continent by as much three quarters.

When Kublai, Genghis’s grandson, was in his early twenties, that he gets his first opportunity at governance after his mother, Sorkaktani, implemented this softer style of cultivation and taxation, learned from Chu-Tsai in the city of Zhengding, 200km south of Beijing. The land was used largely for farming, which was seen as unappealing by more traditional Mongol people who preferred livestock and pasture. Kublai’s estate was south of his mothers and contained around 10,000 homes, and though he did initially leave it to local officials during which time things would decline, this would eventually become a place of growth and peace (STILL a relative term) in a time of total chaos. Under Kublai’s governance during Ogadai’s rule, the region prospered.

While a semblance of peace is rising in the east, the western front of the empire belongs to the General Subadai, one of the Genghis’ best generals(if not THE greatest). The Mongols defeat the Hungarian King Bela’s army of 150 thousand soldiers. Though the reasons for the exact use is contested, artillery (an advantage take from Chinese alchemists/chemists, that would become extremely valuable) was used the first time in history during this battle. Historian Richard Gabriel suspects that 1/3rd of King Bela’s 150 thousand troops died fleeing their final camp on the bank of the Sajo river.

From 1241–1248 the Khan empire would temporarily halt any geopolitical reformation or war campaigning. In 1241 Ogadia Genghis son and first successor would succumb to a lifetime of drink, falling ill and then dying in December during a hunt. It was four years until Guyuk, Ogadai’s son would be selected the Great Khan. Guyuk too, would serve a short lived reign after dying (likely) from poor health due to alcoholism.

It was Guyuk’s Cousin, Mongke Khan, who would restart the Global War Machine that was the Mongol empire, beginning with political and financial reform. In the 1250’s a great undertaking began for the Mongols, when a head tax was instituted for every person in the empire, to include the recently conquered land in Europe and the middle east. As the largest empire in history, this level of global governmental institution, even if it was ONLY clear roads for taxation purposes, could not have been possible up to this time. These taxes also included both agricultural taxes and commercial taxes on business (Man,2006).

To the south of the Mongols, on the brink of destruction lie the once proud Song dynasty. A massive and wonderful empire that was the unification of 6 prior empires into the (at the time) largest economy in the world. Northern china, thibet, nanchao, tangut, and two Vietnams, until the Jin Dynasy invades from the north, also a nomadic horse tribe like the mongols from the steppe. The Song Dynasty (960–1279 AD) are producing 6 billion cash coins a year at this time. The coins, traditionally string in grouping of 1000 coins, were copper silver alloy, that yield approximately “27 dollars-worth” of silver, or one ounce, at today’s global market value. In the early 1200s, around the time the Mongol dynasty is knocking at the door, innovation becomes increasingly necessary as the global threat arises.

Paper money, built on trust, arises, as the need for speed increases. By this time the Speed of commerce is also, by necessity, the speed of the Mongol war machine. First cut from clay and wood blocks, paper money was stamped by individual banking and trust agencies, where cash coin could be exchanges (for a fee of course).

The end of the Song Dynasty, is not just facing death from the north, but also suffering from a copper shortage, no doubt caused by the massive squeezing force of the Mongol world. This drives the government to begin following the useful path established by individuals and federalized the Jaiozi in the 11th century (1000). These would also be redeemable for cash coins, but the profits would go to the government. Not only for use by merchants but also widely distributed by to people.

The Yuan Dyansty, is established in 1271 by Kublai Kahn, Genghis’s Grandson. Under Kublai Kahn trained by the Chinese teacher Chu-Tsai a formerly dissenting chinese statesman seen as honorable, and luckily not killed, by Genghis Kahn he is brough into consult for/with the family for many years.

In the time of Kublai’s emergence the primary form of money in the Chinese lands were strings of 1000 silver coins, amounting to around one ounce in weight of silver, or about twenty-seven dollars today. The Song Dynasty would also be among the first developed nations to begin printing banknotes at exchange offices.

The JaioChao, Kublai’s final instituted money system would be printed with an wood block and then bronze plate casting. The note would simply state, summoning on the power of the Great Kahn and by royal decree, how much cash the note was worth, redeemable by taxes. This fiat currency wasn’t bound to any type of redemption, because there was no obligatory backing in gold, silver or any other physical backing. Thus was. Afirst because

In 1294, the Mongol ruler of Persia, Kublai’s brother Hulagu would attempt to do the imitate the same, by establishing a fiat paper money but enforcing the paper money with old Mongolian force rather than new with newer Chinese nuance. This would lead to a revolt and his downfall when he is overthrown by a nephew, Nogai. Nogai Khan was a convert to Islam and also recognized as the Golden Khan. The power gained by the Islamic ruler is thought to symbolize the end of a unified Mongolian empire and it is he the who would reinstate a silver coin commemorating the defeat of Hulagu that had a picture of a hare on it.

In 1300, Marco Polo publishes his travels of the world, and in his account he described the paper money as

“all these pieces of paper are issued with as much solemnity and authority, as if they were of pure gold or silver, and indeed everyone takes them wheresoever a person may go… he shall find these pieces of paper current, and shall be able to transact all sales and purchases of goods by means of them just as well as if they were coins of pure gold.”

In 1368 The Ming Dyanasty begins when the Mongols are overthrown. They would be the last of the Han Dynasties in China. The Ming dynasty’s Navy became globally powerful and expansive, spreading their influence all the way out as far as Kenya. Using ships that were larger than Christopher Columbus’ Spanish ships, a famous Chinese explorer named Zheng He was conscripted by the Ming emperor coving over 30,000 miles over seven voyages, as a purely exploratory effort. These efforts would cover much of india, the middle east, and north Africa, but eventually would stop due to the empires efforts to turn inward to focus on the world within their borders. The Ming Dyansty would bring back and distribute a cash coin but they also recognized the utility and growing popularity of paper notes.

It isn’t until the American Colonies in the 1700s that Paper money would be used to any global effect, but it is all due to the chaos and destruction, as well as the intentional integration of new pragmatic tools: like growth-based taxing or paper money in the Khan empire that the world is able to move out of the dark ages and into the modern world. Not unlike a great wildfire whose ash fertilizes the ground for a new forest.

References

Barth, J., 2020, History of Money, Youtube lecture series, https://www.youtube.com/channel/UCA3eDoPrs3iE4JaD6HOPV5A

Man, J., 2006, Kublai Khan, Transworld, Kindle Edition

Khan, P., 1988, The secret History of the Mongols, Translated by Francis Woodman Cleaves, likely written by Sigi-quduqu, an adopted son of Genghis Khan

Clements, J., 2010, A Brief History of Kublai Khan

The Chronicle of Novgorod 1016–1471, translated by, Robert Mitchell and PhD. Neville Forbes in 1914 for the London Offices of the Society, Link:

https://faculty.washington.edu/dwaugh/rus/texts/MF1914.pdf

Gibbon, Edward, 1737–1794. Gibbon’s The Decline and Fall of the Roman Empire : a Modern Abridgment. New York :Fawcett Premier, 1987.

2012, Dan Carlin, Wrath of the Khans I-V, Hardcore History Podcast