San José State University
Department of Economics

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Thayer Watkins
Silicon Valley
& Tornado Alley
USA

The Economy and
Economic History of Iraq


The Very Ancient History


The Sumerians


The Akkadians, the Guti and the Amorites


The Hittites, the Assyrians and the Chaldeans


The Iranian Archaemenids and the
Conquest by Alexander of Macedonia


The Arab Conquest


The Great Schism in Islam


The Abbasid Caliphate


The Turk and Mongol Conquests


The Overthrow of the Monarchy and
the Creation of the Republic of Iraq


The Baath Party's Coup D'Etat


The Rise of Saddam Hussain


Money and Monetary Policy
During the Hussain Regime


The Unnecessary Destruction of the
Economy After the 2003 Invasion


The Inevitable Partition of Iraq

The Very Ancient History

The region that is now included in the somewhat artificial nation-state of Iraq has had a very important role in world history. The most important of the world's agricultural revolutions took place in the mountains to the north of the Tigris-Euphrates Rivers Valley somewhere around 6000 BCE. The techniques of this grain agriculture were not immediately adaptable to the river valleys with their severe flooding but eventually tribal groups came to occupy those valleys.

The Sumerians

The most important early settlers of the lower Tigris and Euphrates River Valleys were the Sumerians. The Sumerians came into the marshy lands near the mouths of the Tigris and Euphrates with a fully developed culture that was quite distinct from the cultures of other societies in the regions. The Sumerian cultures were dominated by priesthoods that ruled in the name of a god or goddess. The resources of the society were owned by the temple of the god or goddess and the common people worked for and received sustenance from the temple. The ruling priesthood organized the building and operation of the irrigation system that was the key to the prosperity of the Sumerian city-states. It was quite the analog of the twentieth century socialist states with the priesthood with their religion playing the role of the ideological party engaged in central planning.

The origin of the Sumerians is not completely established but their literature mentions the land of Dilmun which apparently was the island of Bahrain and the adjacent territories. A trading port existed at the north end of Bahrain based upon fresh water springs found there. As is the case with all trading societies Bahrain was a hotbed of cultural and technological development. It would have been a natural source of colonization expeditions to the marshlands near the mouths of the Tigris and Euphrates Rivers. The relationship of Dilmun and Sumeria to the civilization of the Indus River Valley is not certain, but it is clear that the civilization of the Indus River Valley evolved in that location, in contrast to the Sumerian immigrant civilization.

The tribal groups in the area were ruled by warband leaders rather than priest as in the case of the Sumerian city-states. Kings stemming from a military class did not rule until much later in Sumerian history. Initially the Sumerian city-states were isolated and there was plenty of land for everyone. When the city-states grew spatially they began to impinge upon each other. The territorial disputes led to military confrontations and the need for a warrior class. Eventually, as is usually the case, the protector class became the ruling class.

In addition to the inter-Sumerian conflicts there were invasions by nomadic tribes who were covetous of the wealth of the Sumerian city-states. The invaders came from two general sources, Semites from the southwest and Indo-Europeans from the northeast.

The Sumerians were one of the most important innovators of all time. They invented a script for recordkeeping and this was expanded to create a literature as well as recording scientific knowledge. Significant bits of astronomy and mathematics were created by the Sumerians. Some such as the division of the circle into 360 degrees and the day into 24 hours have lasted to this day.

The Akkadians, the Guti and the Amorites

The empire of the Akkadians was created by Sargon I of Akkad. The people of Akkad were Semites and their major strength was in military organization. With a conscripted army Sargon conquered territory as far away as Egypt and Ethiopia. He also conquered the rest of Mesopotamia including Sumeria. But the empire Sargon I put together fell two centuries later to the nomadic tribe of the Guti from what is now Iran. Freed from the rule of Akkad the Sumerians rose up and under the leadership of the city of Ur ultimately defeated the Gutis. The freedom of the Sumerians did not last. They were conquered by the Amorites, a Semitic people from the west who established their capital at Babylon. The Amorites, or Babylonians are they are often labeled, secured an empire that encompassed the Tigris-Euphrates Valley. The most notable ruler was Hammurabi who created a code of laws for governing the empire from Babylon.

The Hittites, the Assyrians and the Chaldeans

The Hittites were a people whose core area was in eastern Anatolia. They were notable for their mastery of iron. They were thought to have the very best weapons. The Hittites assembled an empire which spanned the land area from the eastern Mediterranean to the Persian Gulf. They conquered and destroyed the city of Babylon and with it the power of the Amorites.

The Hittites for a time controlled the area of northern Mesopotamia occupied by the Semitic people known as the Assyrians. When Hittites power faded the Assyrians from their base in the north valley spread their rule south to the Persian Gulf and west to the Mediterranean Sea. They built a new city on the Tigris called Nineveh and tried to destroy Babylon.

Babylon was revived when revolts brought down the Assyrian Empire. The Chaldeans replaced the Assyrians as the dominant power in Mesopotamia and the eastern Mediterranean lands. The Chaldeans resurrected Babylon and when the Chaldean king, Nebuchadnezzar, conquered Judah he tried to destroy Jerusalem by sending its inhabitants into captivity in Babylon. Some of the most glorious days of Babylon were achieved during the rule of the Chaldeans.

The Iranian Achaemenids and the
Conquest by Alexander of Macedonia

The Arab Conquest

Iraq was the land of the good black earth and a major prize of the Middle East so it was not very long after the armies of Islam moved out of western Arabia that they came to the Tigris-Euphrates Valley. In addition to the great bonanza of fertile land irrigated by a system of canals there were fabled cities. There had been Babylon in the past but in the seventh century the major city was Ctesiphon the capital city of the Persian Sasanid dynasty.

The chronic warfare between the Sasanids of the Persian Empire and the Eastern Roman Empire of Byzantium left the region weakened. There were also Arab tribes in the area which were always ready to conquer the civilization of the valley. By the early seventh century most of the Bedouin Arab tribes in the region were Christians. This was before Islam.

When the Arab armies controlled from Medina arrived in Iraq about 634 AD there was already great resentment by the local Arab tribes against the Sasanid Persian Empire. It did not take much to convert some of those tribes to Islam and ally them for the invasion of the Persian Empire. In the first battle the Muslim army failed to defeat the Sasanids but was able to retreat back into the desert to regroup and rearm. A new commander, Said ibn Abi Waqqas, emerged and in 636 led the Muslim army to victory over a larger Sasanid army at the Battle of Qadisiyya. In that battle the Sasanid commander was killed. After this victory the Muslim army went north to the Sasanid capital of Ctesiphon to capture and loot it. With the Sasanid army broken the Muslim army moved to the north to capture Mosul and the surrounding region.

The Caliph Umma Abu Bakr in Medina tried to maintain an isolation of the Muslim army in Iraq from the local population. He had established garrison towns, called amsar for his soldiers and their families. These were on the edge of the desert to ensure free contact with Medina. This was the origin of Basra and Kufa.

The administrative centers of the Caliphate were Basra, Kufa and Mosul. For the administration of the local areas the Caliph relied upon the Persian bureaucracy that was already there and experienced. The land and property of the Sasanid nobility were confiscated distributed to the army, the Caliph or made Muslim community property. The land was taxed.

The non-Arab converts to Islam were not equal to the Arabs. They had to affiliate themselves with one of the Arab tribes and were thus clients of their selected tribe and known by that name mawali. The people of the book, the Jews and Christians, were not forced to convert to become Muslims but they had to pay a special tax.

The Great Schism in Islam

Although most people think that Shi'ism arose in Iran that is not the case. Shi'ism arose in Iraq over the issue of the succession of the political and religious leadership of the Islamic world. Umma Abu Bakr had been universally accepted as caliph. He was assassinated in 644 by a Christian Persian slave. At this stage Islam had been by and large a movement of Arabs viewing themselves as the chosen people of Allah. This was not the dogma of Islam but nevertheless an important element of the social perception. There was along with the veneration of the person of Mohammad a perception that his blood line was somehow sacred. Again this was not part of the dogma of Islam but nevertheless an important social perception.

The council of elders, the ulema, chose Uthman ibn Affan as the new caliph. Uthman belong to the powerful Meccan clan, the Banu Ummayya, who had most strongly opposed Mohammad and drove him out of Mecca. At this time the Arabs were still highly tribal and the sins of any members of a group fell upon all members of the group. So the past opposition of the Banu Umayya clan to Mohammad clung to all members of the clan even after the clan had converted and became pious Muslims. Uthman, as was the usual practice, chose members of his clan for high positions in his caliphate. So Uthman's caliphate was burdened not only by the charge of favoring relatives but also of putting into power people associated with a past but not forgotten opposition to Mohammad in Mecca. For example, Uthman gave his half-brother the governorship of the territory in Iraq controlled from Kufa. That half brother in his days before conversion to Islam had once spit upon Mohammad in Mecca. This was an offence that could not be easily forgotten by the pious. When that half brother proved to be a poor governor the people doubly blamed Uthman. Finally in 656 Uthman was assassinated by soldiers from Egypt.

With the general resentment against Uthman the matter of the choice of a new caliph was the subject of extreme public concern. The Ulema (council of religious scholars) chose Ali ibn Abi Talib. Ali was the husband of Mohammad's daughter Fatima and also a cousin of Mohammad. This appointment was not accepted by powerful figures in the family of Mohammad. In particular the favorite wife of Mohammad, Ayshe, opposed it and she was supported by two of Mohammad's closest friends. When Ali did not immediately kill those associated with the assassination of Uthman. Ayshe and her allies went to the military outpost of Basra in Iraq to raise their rebellion. Ali sought to suppress the rebels.

The Abbasid Caliphate

(Under construction)

The Turk and Mongol Conquests

(Under construction)

The Overthrow of the Monarchy and
the Creation of the Republic of Iraq

(Under construction)

The Baath Party's Coup d'Etat

(Under construction)

The Rise of Saddam Hussain

(Under construction)

Money and Monetary Policy
During the Hussain Regime

(Under construction)

The Unnecessary Destruction of the
Economy After the 2003 Invasion

(Under construction)

The Inevitable Partition of Iraq

(Under construction)

(To be continued.)


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