WE could Learn alot from the Decline and Fall of Spain

[JimBowie1958]

American conservatives like to make comparisons to Rome, and there is some validity to that.

But I think the experiences of the declining Spanish Empire are more instructive for us.

Chapter 15: A History of Spain and Portugal

Spain's seventeenth-century decline has received less study than any other major period of Spanish history. In part, this is because it is more remote than the modern phase that began in the eighteenth century, but it must also be explained by the painful reactions that comparisons with the glories of the late-fifteenth and sixteenth centuries evoke. By the end of the first quarter of the seventeenth century, perceptive Spaniards were clearly aware that they were living in an age of marked decline, and the sense of frustration and of waning accomplishment became steadily more conscious and general as the decades advanced. Subsequently, in the eighteenth and nineteenth centuries, historiographic opinion viewed the period as decadent, a description still commonly used.

More recently, twentieth-century nationalist historiography has questioned the judgment of decadence, suggesting that the time was merely one of stagnation in which the country was unable to develop at a rate equal to more expansive powers, because of the weight of imperial responsibilities. While it is true that Spain would have had to run faster than she had in the sixteenth century in order not to lose ground in the seventeenth century--a period of greater competition and development among west European powers--she was unable to maintain even the pace of 1600. The seventeenth century was, in fact, more than a time of stagnation; it was a period of general decline. Moreover, the society [291] and culture showed signs of decadence in the strict sense of the term.

An actual decline was reflected, first of all, in population. At the end of the sixteenth century, the Spanish homeland (excluding Portugal) had nearly 8,500,000 people, but in 1700 only about 7,000,000. Epidemic disease was the major cause for this decline, especially the bubonic plague but also typhus, smallpox, and other maladies. They were particularly lethal because the growth of towns in the sixteenth century had crowded many tens of thousands of the poor together in filthy conditions, and because economic decline brought a drop in food production, higher prices, lower purchasing power, reduced imports, and widespread malnutrition, particularly after years of poor harvests. The great plague of 1596-1602 attacked widespread areas of Castile and claimed 600,000 to 700,000 lives, or about 10 percent of the population, a figure almost equal to the gain of the preceding century.

A second plague of great magnitude struck the eastern and southern parts of the peninsula in 1647-1652, and other devastating outbreaks occurred during the trough of the economic decline, between 1676 and 1685. Lesser epidemics raged intermittently throughout the century. It appears that altogether more than 1,250,000 deaths resulted from the extreme incidence of plague in seventeenth-century Spain. the worst era of epidemics in recorded peninsular history save for the period of the Black Death.

Jaime Vicens Vives has suggested seven prime causes of the seventeenth-century economic decline: 1) continued increase in the size of entailed domains held by the aristocracy and the church, which had the effect of withdrawing land from use and of lowering production; 2) increasing social disruption and vagrancy; 3) deforestation; 4) an overabundance of clerics; 5) the status orientation of society; 6) the negative, charity-oriented religious attitudes toward poverty that precluded serious thought of reform and new enterprise; and most important of all, 7) government policy, which maintained prohibitive taxes in Castile, produced capricious waves of alternating inflation and deflation that led to monetary chaos, over-regulated some aspects of the economy, and was incompetent in planning and execution.

The tax burden on Castile, already destructive during the reign of Felipe II, became unbearable during the course of the seventeenth century. The constitutional systems of the eastern principalities continued to protect them from all special levies save sporadic grants made grudgingly by their Cortes, which averaged out to a per capita annual rate considerably less than that paid by Castilians. The only institution in the east that paid anything approaching a proportionate share of taxes was the church.

In fact, the eastern principalities paid much less than did the Italian territories of the crown--Sicily, Naples and Milan--which in some years by the end of the sixteenth century were paying over five million ducats and carrying much of the cost of imperial defense in the Mediterranean and in south-central Europe.

But the main responsibility still fell on Castile, which from the 1590s on was called upon to pay two-thirds of the cost of government out of its ordinary taxes. The nominal tax rates were not in themselves exorbitant, but the power of the aristocracy to shove the weight of them onto the middle classes and the peasantry, together with the exactions of tax farmers and agents who raked off much of the proceeds, led to crushing imposts on production that drove tens of thousands of peasant families off the land and into emigration or poverty in the crowded cities.

This situation was aggravated by a capricious, irresponsible royal monetary policy. During the sixteenth century the Spanish monarchy had maintained a sound currency based on a fairly steady silver value, but by 1599, with the bulk of royal income already going for [293] debt service, it was decided to debase the coinage by issuing copper money. This led to a two-year bout of inflation, and after a temporary end to monetary debasement, a slight price decline from 1601 to 1610. During the next decade prices were generally stable, but further debasement led to serious inflation in the 1620s and sporadic inflation from 1636 to 1638 and in the 1640s. Altogether, prices rose nearly 40 percent in the quarter-century 1625-1650. This in itself would not have been so serious had it not been for the pendular swings from inflation to deflation that discouraged production and commerce even further.

Capital and credit were increasingly scarce from the latter part of the sixteenth century. The bankruptcy of 1596 was the final blow that completed the ruin of Medina and the other financial centers of northern Castile. The problem was not the absence of capital, for it existed among the aristocracy; it was a problem of values and priorities. The upper classes and the church had already established a pattern of preferring the moderately high rate of interest from state bonds and short-term loans to long-term investments involving greater risk. In view of these preferences, the existence of more capital would not in itself have guaranteed more productive undertakings. At any rate, even the favored "safe" investments proved less and less lucrative with the eventual near collapse of the state financial system and the decline of agriculture, the source of income from many short-term loans. In turn, the crown came to rely almost exclusively on foreign sources of credit.

The most serious domestic aspect of the seventeenth-century economic decline was in the most fundamental area -- food production. Agriculture declined fairly steadily, with brief moments of recovery due mainly to better weather, until it reached a secular trough in the 1680s. The principal factor was probably the enormous weight of taxation on peasant agriculture in Castile. In some regions, the peasant paid five or six different kinds of duties -- a tithe to the church that in certain districts amounted to nearer a fifth than a tenth of his production, seigneurial dues to his lord, rent to the landlord who held immediate economic jurisdiction (usually a different and lesser personage than the former), taxes to the crown, and in many instances, interests and payments on short-term loans without which he could not have stayed in production. In parts of Castile these amounted to more than half of an income which was often only marginal at best, and thus made it impossible to maintain a family on the land. The pressure of sheep-herding interests was lessening, for wool exports were also declining in a more competitive international market, and market price restrictions on the food producer could often be evaded, [294] but in general, nonagrarian prices rose more rapidly than did those for food produced, trapping the peasantry in a price scissors. All the while, land rents increased with the general inflation of the period. There was no escape from taxation and dues, and even the weather grew worse during the second half of the century. The result was drastic rural depopulation in large areas, particularly in the Duero valley of León and Old Castile, and in the Toledo and Guadalajara districts of New Castile.

Domestic manufactures, which had begun to decline in the late sixteenth century, continued their decline during the seventeenth century. The chief textile-producing towns of New Castile suffered a disastrous drop in population. During the course of the century, Toledo fell from 50,000 to 20,000 inhabitants, Segovia from 25,000 to 8,000, and Cuenca from 15,000 to 5,000. Much of the Spanish clothing market was lost to foreign competition, especially to durable, light-weight English woolens. Again, the chief reasons were the absence of enterprise, the failure to adapt to new demands and possibilities, the lack of technological improvement in production, and the loss of skilled labor. Relative inefficiency coupled with comparatively high wages resulted in high production costs that priced many Spanish manufactures out of the market.

The other two domestic industries that had been important were Basque iron production and shipbuilding along the northern coasts. These also declined rather precipitously, for the same factors were at work. After the general volume of shipping and commerce started to contract in the 1620s, demand for new vessels naturally lessened, but even the boats that were bought and chartered were increasingly apt to be foreign, because of superior design and construction. The cost of naval stores had been disproportionately high in the peninsula for a long time. This, plus the failure to improve techniques or design, left the north Spanish shipbuilding industry in the doldrums throughout the century. Similarly, Basque iron production, which at times had exceeded 3,000 tons annually in the sixteenth century, dropped off markedly and was unable to supply the domestic market or sustain the needs of the Spanish military.

It is uncanny how this is so similar to what has bedeviled the US in the last twenty years.

We first put off having children to afford more things, then we have fewer buyers for the next generation and everything falls in demand. The state tries to inflate the economy by pumping out more currency, but that only causes inflation.

And Spain slowly crumbled into the shell of its former self by the time of the Spanish American war there was little left.

But at ever step most of the Spanish leadership no doubt would defend the power of Spain and assert that it was not in decline, even though all the numbers said it was.

Again, uncanny how similar to us.

 

[JimBowie1958]

The decline in food and textile production was met by a corresponding rise in imports from abroad. Spain was largely dependent [295] on northern Europe for naval stores, and relied increasingly on countries in that region and on France for textiles, hardware, paper, and enough grain to try to make up food deficits. Such increasing need, coupled with the military failures of the second half of the reign of Felipe IV, led to a series of commercial treaties between 1648 and 1667 with Holland, France, and England, granting these powers broad commercial privileges and comparatively low tariff rates on their exports to Spain. Spanish exports steadily declined. Wool remained the staple export, and Spanish wool continued to be of comparatively high quality. However, the size of the Mesta's herds had been dwindling since the late sixteenth century as a result of soil erosion, lack of credit, high export taxes, and legal pressure against the Mesta that was finally reducing its grazing privileges. The volume of wool export remained respectably high through the first half of the seventeenth century, but then sagged irretrievably. The other basic exports--wine, olive oil, Basque iron, and American cochineal--also declined as a result of the depression in agriculture and domestic manufacture and the slump in the American trade. The only general exception to this pattern was the trade of Bilbao, which remained fairly constant as a belated increase in iron exports helped to make good much of the loss suffered in the decline of the wool trade. Overall, however, the balance of Spanish foreign trade during the second half of the century was overwhelmingly unfavorable, and was sustained only by the re-export of American bullion. Yet the decline in bullion production reduced the possibilities of importing enough to compensate for the failure of domestic production and resulted in poverty and hunger for much of Spanish society.

The foreign share in Spanish commerce grew throughout the century until, by the second half, it was dominant. Not only was the volume of imports extremely high, but foreign capital established its control of the intra-Hispanic trade from the Andalusian ports, while east coast shipping, at least during the middle years of the century, was dominated largely by French and Genoese financiers and merchants.

Again, so eerily similar.

 

[JimBowie1958]

The Spanish are not individualists, but personalists, which is quite different. The individualist in effect believes that society is constituted by individuals who have or ought to have more or less the same rights and duties. He asks that his be respected and agrees to respect those of others. The personalist sees each person as isolated (beginning with himself), with a series of distinct characteristics, and has no scruples about abusing some and favoring others, since he sees them all as inherently different, some of them sympathetic and attractive to him and others not. The personalist starts from a boundless, instinctive, and capricious ego to judge his neighbor and determine what he does or does not deserve. (3)

Hence the period of decline was a time of great pomp and display of luxury as aristocrats vied with one another for positions of splendor, particularly during the first four decades of the seventeenth century. As a result, most of the nobility were financially pressed, because despite their incomes, expenses always ran ahead. Aristocratic lands were usually mismanaged and produced only a portion of what they might have, but the landed nobles considered such concerns beneath them.

Lord have mercy....

 

[JimBowie1958]

The middle classes had largely lost control of municipal government to the caballeros and hidalgos. Though many Castilian towns practiced the system of mitad de oficios by which offices were divided between nobles and commoners, nearly all the important and lucrative positions were held by the nobles. In the south they were all-powerful, though in the towns of central Castile and in the north, the middle classes made some effort to contest their leadership.

These local government offices were not service positions filled by a patriotic gentry, but money-making posts through which the local nobility diverted the income of local government, and particularly its tax collection, to benefit their own purses. Thus the nobility not only shifted the taxes onto the middle and lower classes but actually made a profit from collecting them.

The hypertrophy of the aristocracy and the failure of the middle classes left the entrepreneurial role to elements entirely outside Spanish society. Italian merchants and financiers had already been active in the sixteenth century, and their numbers were increased by new aliens from Portugal, France, and Holland. The movement toward a closed Counter-Reformation society had never been complete, and in practice there was considerable toleration for foreigners who limited themselves to clearly defined activities that Spaniards themselves were ill-prepared to carry on.

By 1650 there were approximately 150,000 foreigners in Spain--nearly 2 percent of the population, the main segment of the country's entrepreneurial middle class.

That is where we are going today.

 

[JimBowie1958]

Crises of Empire

Walter Brueggemann and others were teaching me that the Bible not only identifies God with a preferential option for the poor but also “predicts total social, political, and economic collapse if [God’s] justice is not realized.”[1] In other words, if society doesn’t protect the poor, the nation will ultimately collapse. Given the state of America’s poor, that didn’t seem like good news for our society.

But it was the 1980s and the US still seemed at the height of its powers. Collapse was nowhere in sight. Lacking the faith to trust biblical insight without empirical evidence, I basically kept my suspicions to myself.

Well, twenty years later, here we are in a society falling apart and the prophets seem incredibly prescient. But is there an empirical connection between our refusal of the biblical shalom, on the one hand, and global warming, widespread hunger, people being losing their homes, on the other?

It’s pretty clear, actually.

In his book Wealth and Democracy, political scientist Kevin Phillips traces the economic, social and political history of the last four great Western empires: Spain, Holland, England, and the United States. He finds astonishing similarities in their trajectories from emerging power through a “Golden Age” of general prosperity and then to social decline.

Spain’s rise to prominence began when gold and silver started arriving from the Americas in the early 1500s. At first the benefits accrued only to royalty and the wealthy, but the empire consolidated its power and moved into a Golden Age by investing in manufacturing and commerce. This led to jobs and higher incomes for a broad swath of people, so inequality within the country fell.

By about 1600 there were some signs of developing weakness in manufacturing, but the biggest problem for Spain paradoxically was its wealth. All the gold and silver arriving from the New World inflated prices for everyday goods. Imported goods were relatively cheaper, leading to the decline of domestic manufacturing. Then the wealthy began to invest wherever their economic returns were highest: in banking and finance or investments in other countries rather than in Spain’s own manufacturing or commerce, which therefore declined. Wages fell and people lost their jobs. The rich just lived off their wealth while poverty and destitution spread.

The coup de grâce for Spain was the financial burden of the Thirty-Years War, which left the government weakened. Eventually, the feudal system returned as workers left their jobs and returned as peasants on large estates.

History doesn't repeat itself, but it does rhyme, and right now, the fate that the Spanish brought onto Spain is our dirge.

 

[editec]

Did your scholar mention the pernicious effects of all that looted GOLD that the Spain ended up with?

That GOLD really was a big part of the downfall of the Spainish nation.

the rich no longer needed to be productive (they had loot) so all that gold caused INFLATION at the same time that the industry in Spain was largely abandoned.

Spain as a society got sick from too much WEALTH (gold and silver).

Ironic, no?

 

[JimBowie1958]

Did your scholar mention the pernicious effects of all that looted GOLD that the Spain ended up with?

That GOLD really was a big part of the downfall of the Spainish nation.

the rich no longer needed to be productive (they had loot) so all that gold caused INFLATION at the same time that the industry in Spain was largely abandoned.

Spain as a society got sick from too much WEALTH (gold and silver).

Ironic, no?

He covered that (and silver) in another part, if I recall correctly.

But yeah, the Spanish were swamped with precious metals, then introduced copper coins then started cutting the metal content too, IIRC.

Once the rich had their absolute grip on the nation, it was really over for Spain.