EMERGING FROM THE ASHES
Part 2

Friday May 18th, AD2007

The communist Khmer Rouge's four-year folly in Cambodia is one of mankind's less glorious moments. Led by the brutal Pol Pot, the human cost of this stupid revolution was horrific. According to conservative estimates, over one million people, or one in seven of the country's population, died from starvation, malnutrition, torture, execution or physical abuse.

By 1979 every trace and resemblance of civilized life had vanished and the economy had completely collapsed. Towns and villages were abandoned, dead bodies littered the countryside, the formerly productive fields no longer tilled, and all forms of money had vanished. That same year, the Vietnamese invaded their neighbour and slowly began to weaken the Khmer Rouge's
stranglehold on the country. Like the swing of a pendulum, free market money (the money that the free market freely chose to accept) quickly flowed back into the region aiding the reemergence of an economy.

Someth May survived a Khmer Rouge labour camp and recorded this economic reemergence; "Apart from foraging for rice there were three ways of making your living. Those who didn't want to leave the village for fear of meeting Khmer Rouge, worked in the market or made palm sugar or toddy. There were the fishermen, who went in groups for safety. And then there were the 'gold-diggers', who wandered round the outskirts of the villages searching for corpses and graves. Most Cambodians had gold-capped teeth, so these men became known as millionaires. With astonishing speed - this all happened in a matter of weeks - the gold diggers had motorbikes, brand new Hondas, which they bought along the border. They had amazing watches, gold chains around their necks, shirts open to the waist, Thai cigarettes.

Gold was currency. It came in sheets. If you wanted to pay for something small you snipped a bit off with scissors. People didn't yet have scales. The city of Sisophon was the center of the gold economy, and everyone knew what he was doing. The tradesmen had balances in glass cases. The smugglers had their own balances. Even the Vietnamese had balances, so that they could settle any arguments which broke out. The tradesmen held the gold in gas jets, heating
it till it was red hot, then letting it cool. If it discoloured as it cooled it wasn't pure. All gold had to be cut before it was accepted, to make sure there was no core of base metal. The most elaborate of bracelets were being chopped up in this way. There were little children who waited for the traders to go, then searched where they had been cutting the gold for the tiniest
specks.

As well, there was an old kind of coinage which was called trough money, dating from pre-colonial days, when sawn in half, the silver was absolutely white and pure. Traders were hammering them into different shapes, testing their malleability. (1)"

Cambodia in the late 1970's is not the first time that the teeth and jewelry of the dead have monetised the reemergence of an economy. Someth May's account is a provocative, recent example of the age-old story. Cambodia in 1979 experienced first hand and very quickly, stage seven in the Life Cycle of Money; 'Reemergence of Gold and Silver. Man had ceased working and producing, the economy had collapsed, and money had failed. But the day balances of power
turned, the economy sprung immediately back to life. Men picked up their tools and went back to work. Money instantly appeared, the only money that man has always returned to in times of change and social and economic upheaval, gold and silver 'Free Market Money'.

In yesterday's Daily Dig we quoted Millennium Money's closing words; "from the ashes and ruins emerges a new age ruled by those who were prepared, a golden era, a new millennium." In Cambodia's new economy, the richest men were those who controlled and held the gold.

Sincerely - Philip Judge pjudge@anglofareast.com

(1) Someth May's account taken from Frozen Desire by James Buchan