Adam Smith, the father of modern capitalist economics, famously wrote in The Wealth of Nations (1776), “The value of money is in proportion to the quantity of the necessaries of life which it will purchase.” This statement emphasizes that the true worth of money is determined by its purchasing power, particularly in terms of basic necessities like food, clothing, and shelter. In essence, money’s value is not inherent, but rooted in its ability to fulfill human needs.
Yet, in one dark chapter of Cambodian history, there was a time when money ceased to exist, and people reverted to an ancient barter system. This occurred under the Khmer Rouge regime, a genocidal regime that sought to upend Cambodia’s social and economic systems in the name of radical ideological transformation.
The Khmer Rouge’s Precursor to Economic Collapse
Surprisingly, the Khmer Rouge’s assault on money began before they took full control of Cambodia in 1975. As early as 1972, in areas they called “liberated zones” in the north, the Khmer Rouge closed down markets, thereby replacing the capitalist economy with a state-controlled system. Residents lived in cooperatives and were allowed to purchase only a limited amount of goods from the state. This shift from a market-based economy to a controlled one signaled the beginning of the Khmer Rouge’s drastic economic experiment.
When the Khmer Rouge seized full control of Cambodia, they escalated their ideological crusade against money, taking radical steps to eradicate what they deemed a symbol of exploitation and inequality. They abolished commercial cooperatives at the local level and consolidated economic power at the center, nationalizing all property and means of production. The regime’s intentions were articulated in policies outlined in Revolutionary Flag Magazine between 1975 and 1976, which included a focus on self-reliant rice production, state control over commerce, and, most shockingly, the outright abolition of money.
Pol Pot’s Vision: A Society Without Money
On May 20, 1975, Pol Pot addressed a gathering in Phnom Penh, where he formally declared the Khmer Rouge’s economic vision. He stated, “Stop using money and eliminate markets. If there are markets and bartering, there will be the oppressed and the oppressor. Therefore, the people must stop using money. If they use money, it is very hard for us to control. Money creates bribery. We should turn cooperatives into special cooperatives. A small bag of belongings is enough even for a district chief.”
This policy was swiftly implemented, and dissent was brutally suppressed. Anyone who dared oppose the policy risked execution. Tram Kak district in Takeo Province was the first to formally abolish money, with the Khmer Rouge indoctrinating the population into believing that money led to unproductive behavior. As fear of punishment gripped the population, the policy spread across Cambodia.
The Policy’s Brutal Consequences
By September 30, 1976, Pol Pot reiterated the Khmer Rouge’s stance, calling money “poisonous,” arguing that it would drag society back into a “society of privacy.” At this point, money, bartering, and markets were all banned under the regime’s slogan: “No sale, no exchange, no gain, no theft, no robbery, no personal ownership.”
Such an extreme economic policy was unprecedented. Even in the Cold War context, neither the Soviet Union nor China attempted such a drastic move. Youk Chhang, director of the Documentation Centre of Cambodia (DC-Cam), stated, “Abolishing the currency was rebellious even within Khmer Rouge ideology itself. They brought themselves to their own destruction.”
Rather than fostering equality, the abolition of money led to widespread chaos and suffering. The economy collapsed, and the state became the sole distributor of food and goods. Cooperatives, intended to distribute resources, were inefficient, and famine swept the country. Desperate for survival, many citizens resorted to extreme measures.
Kim Heng, a former health cadre, recalled how those who questioned the lack of money were branded traitors and often arrested or executed. The Khmer Rouge’s tight grip on the economy ensured that any deviation from the policy was met with violent retribution.
The Irony of the Khmer Rouge’s Currency
One of the most tragic ironies of this economic experiment was that the Khmer Rouge had printed their own currency in early 1975. However, after taking control, they chose not to circulate these banknotes. Instead, these newly printed bills became a symbol of an unfulfilled economic plan, as their intended use was never realized.
Unlike the Soviet Union or China, which maintained centrally planned economies but continued to use money, the Khmer Rouge attempted to function without a currency. This radical experiment proved disastrous.
The Aftermath of the Khmer Rouge’s Economic Collapse
Following the Khmer Rouge’s downfall in 1979, the new government of the People’s Republic of Kampuchea began to rebuild Cambodia’s shattered economy. On March 20, 1980, a new currency—the Riel—was issued, marking a return to a monetary system. Markets were reopened, and the economy began its slow recovery.
The Khmer Rouge’s economic policies left a legacy that continued to haunt Cambodia for decades. Between 1993 and 1998, the remnants of the Khmer Rouge movement printed their own currency again in the territories they controlled, as a symbolic gesture of defiance against the Phnom Penh government. The notes were poorly made, featuring photographs of rural life and signed by Khieu Samphan, the Khmer Rouge’s head of state.
A Dark Lesson in History
Youk Chhang reflected on the broader historical significance of the Khmer Rouge’s economic policies. He pointed out that even the Angkorian Empire, which existed without a formal currency system, was aware of coinage from neighboring regions. “Cambodia is the only country in the world ever to have abolished money,” he noted. “Pol Pot, the leader of the Khmer Rouge, abolished money, markets, and private property, blowing up the Central Bank to underscore his point.”
The Khmer Rouge’s radical experiment serves as a dark reminder of the dangers of ideologically driven economic policies—how the desire for absolute control can lead to societal collapse and human suffering. Cambodia’s history with the Khmer Rouge’s war on money remains a cautionary tale in both ancient and modern economic thought.
