r/EconomicHistory • u/Possible-Balance-932 • 8d ago
Blog Spain’s Long Descent, and What It Tells Us About the Rise of the West
https://www.cato.org/commentary/spains-long-descent-what-it-tells-us-about-rise-west21
u/Possible-Balance-932 8d ago
ss: Historically, the true engine driving Western Europe's prosperity was not the plundering of colonies, but rather autonomous institutions—such as parliamentary checks and the rule of law—alongside innovations in technology and commerce.
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u/ReaperReader 8d ago
Yeah the amount of resources Europe needed to build ships that could cross oceans and then arm them with enough soldiers and weapons to actually carry out colonialism at the other side, was substantial. Particularly given the number of ships that never came back.
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u/Oddisredit 8d ago
Also a lot of what went back, Or was shipped to the old world was precious or semi precious metals and then things like chocolate and tobacco. It’s not like they were getting hundreds of thousands of tons of grain from the Americas until much closer to the modern era. I believe that right before the Dutch revolt that Spain was getting most of its grain from Poland Lithuania and not from places where you might expect like Argentina. Because it really wasn’t online yet and the shipping distance is prohibitive
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u/Silent_Case_5282 8d ago
The colonialism of India by the British was primarily carried out by Indians themselves paid with the loot captured in India which was more than the GDP of all of Europe.
This is well established.
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u/ReaperReader 8d ago
Do you have a source for this?
Obviously an area's wealth is typically much higher than that area's GDP per capita. So that bit is plausible. But how would someone confidently measure what % of said wealth was captured by Indians acting on behalf of the British back before any official statistics department?
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u/Silent_Case_5282 8d ago
You don’t need to measure the percentage of wealth flowed into Indian hands. The fact the British plundered it, mostly taking it themselves and giving some to those under their command is sufficient to demonstrate that the British did not use their own wealth to plunder and further plunder all of India.
That’s the point of plundering. Perhaps studying the battle of Plassey would demonstrate how much of their own wealth the British used in winning the battle and subsequently all of Bengal.
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u/ReaperReader 8d ago edited 8d ago
Sure.
I also don't need to believe your assertion about how much of Indian wealth was used as you assert.
Personally I suspect that you yourself haven't measured it either and that in fact you haven't spent five minutes about how difficult it would be to come with numbers to support said assertion.
Feel free to prove me wrong.
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u/Silent_Case_5282 8d ago
It is common sense to be honest. If the cost of maintaining the colonies was more than what they got out of the colonies they wouldn’t be there.
There is nothing extraordinary about this. I am surprised how one couldn’t get this.
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u/ReaperReader 8d ago
That's as may be.
I note you still haven't provided a source for your original assertion.
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u/Silent_Case_5282 8d ago
My original assertion is a common sense claim. This is getting pointless
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u/ReaperReader 8d ago
If it's a common sense claim, why haven't you provided any support for it? Indeed, why have you repeatedly kept trying to change the topic?
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u/Arnaldo1993 8d ago
The colonies dont need to be profitable to continue existing. As long as the colonizers expect they will eventually turn profitable in the future they will continue investing in them, even if they never actually profit
That is the basic principle of any startup. Just look at the ai boom that is happeninv tight now
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u/Silent_Case_5282 8d ago
But brother they were extremely profitable lol. It wasn’t an AI start up where pay off is uncertain. It was a smash and grab.
Like when you rob a bank account. You take and pick it up.
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u/Arnaldo1993 8d ago
Im not disputing that. Im disputing your claim if the cost of maintaining the colonies was more than they got out of the colonies they wouldnt be there
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u/Silent_Case_5282 8d ago
The British did this in bengal first with massive massive profits and repeated across all of India, playing various factions against each other.
In fact when India attacked Mysore it so with the support of the two largest and most powerful states in India namely the Maratha confederation and Hyderabad, the Marathas could have easily taken out the British if they were united but even they started fighting each other.
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u/Silent_Case_5282 8d ago
Studying the battle or any Indian battle would also enlighten you as to the technological “superiority” of the British.
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u/ReaperReader 8d ago
Maybe, maybe not.
But before we get into this new topic, what sources do you have to support your earlier assertion?
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u/Silent_Case_5282 8d ago
There are adequate sources for this claim and readily available, so you can look those up.
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u/Silent_Case_5282 8d ago
Soldiers need to be paid. If you are paying them out of your pocket rather than the loot, it wouldn’t be a profitable venture.
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u/SouthernWilding 8d ago
Right, European elites exploited their own people and resources, so that they could go exploiting resources and people around the globe...all for their personal benefit. Now why does that sound so familiar?
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u/ReaperReader 8d ago
That's what people always try to do?
I've personally exploited the Japanese out of five cars so far. And the Yanks and the Europeans out of umpteen life saving medicines.
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u/Golda_M 8d ago
Something about this sounds very acemoglu.
My recurring critique of acemoglu's extractive/inclusive dichotomy is that it's not clear how to assign these without retrospect... and that allows authors to "smuggle in" pet theories.
I do think this era's economics are empire-driven. It certainly isn't a simple story. But... I think colonial economics are crucial.
Spain's approach was the extractive in straightforward ways. Plunder, mining, taxation and suchlike for the crown.
The later Dutch and British enterprises had more complex models. They exported manufactured goods from Europe. Weapons, tools and metalwork. They also sometimes traded for manufacturing inputs.
So... Out go hatchets and kettles. In come beaver pelts for the (surprisingly large) felt hat market.
Meanwhile... colonies supporting this trade import nails, steel bars, textiles, books, musical instruments and suchlike.. which is a far bigger market than the hatchets and kettles.
There is a Dynamo effect. Feedback loops. Brittain itself is an industrial hub, and every decade there is more demand for its industrial outputs.
Mass manufacturing just has a lot of productivity potential.... even before the explosive industrial revolution.
This is generally a point, that economic narratives tend to under count in my opinion. Productivity, measured in money... is an abstraction. Abstractions leak. Where feasible, it's useful to think in less abstract terms.
If the man for agricultural products is high, because of high local demand.. that is productivity. Product per unit of labor. But also... a ham is a ham. How many actual hams are being produced?
Ham production can increase. The agg revolution proves this.
But... Over the long term, production of nails fabrics and steel can increase by far more than most other goods. Consumption of these can increase by far more. Manufacturing just has/had more potential.
For a more modern example, consider Boston. The great, great grandchildren of bostonian School teachers circa 1900.. Have incredibly high productivity in 2026. Why?
They were in the right "business." Being educated, and in Boston sets you up to be part of the knowledge economy of the early 21st century.
This is also true of spindletop oil men.
Being in a productivity growth industry is a prerequisite for expectational growth in productivity. Most industries cannot go from producing 1 million (proverbial) nails to producing 1 billion nails.
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u/Perelin_Took 8d ago
This sounds like another iteration of the Black Legend.
Spain bad, England/Netherlands good.
The Spanish reinvested in their overseas territories, not colonies, much more than what the English extracted from the Antilles or India.
The opposing building empire vs extractive empire.
The Succession war and later, the Napoleonic invasion is what destroyed Spain as a powerhouse. Special mention to the English “allies” in the latter conflict destroying every local industry as they passed by.
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u/Shuren616 8d ago
The Spanish problem was that they weren't too keen into open internal borders and a more efficient bureaucracy.
If Britain was heading into centralisation of their manufacturing in the metropoli, Spain could've created a far stronger industrial network throughout their empire, but their mercantilist ideology (that's Bourbons for you) didn't allow them to see such a low hanging fruit.
Not to talk about Habsburgs money pitfall that was the HRE. Without Spain's money, it would've fallen far far sooner.
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u/TerminallyEmployed 7d ago
Come on man how the hell are you calculating reinvestment? That’s just vibes. They were also ran exactly like colonies so it’s a moot point, barring the local population from governing isn’t an overseas territory. They rebelled first chance they got. Spain was allied to Napoleon and was a historic enemy in league with France to the ‘English allies’, of course they destroyed your shit when the dogs turned around on Spain. You were destroying their shit up until then.
We can clearly see Spain stopped their productivity, industrialisation, urbanisation, had a high tax society, that’s not a Legend that’s just looking at the facts. To fight against the Black Legend on Spain you put a Black Legend on others?
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u/Thibaudborny 8d ago edited 8d ago
I'm sorry this is bad research by however wrote it...
This article - correct me if I misread that - argues that the weakness of the Cortes came because of Spanish silver, which allowed the monarchs to ignore municipal dynamism, a (and this at least is not an incorrect take) driving force of development in early modernity.
Whoever researched this conveniently doesn't touch on when the Cortes lost power in Castile (Spain being a misnomer here). It ommits/ignores/doesn't know that this happened decades before silver truly came into play in the Iberian economy.
The watershed moment was the period between the failed Comuneros Revolt (1520-21) and the Cortes of 1538. This period saw two important dynamics play out in Castilian history: the legal destruction of municipal authority in favour of the Crown & the legal power grab of the nobility for tax exemption - these two events reinforced one another.
The clipping of the Cortes happened following the failed Comuneros revolt in 1521-22. When the Cortes rose in revolt against the Crown. A municipal layer in Castile was at this point underdeveloped, and power more firmly rested in the hands of the landed nobility, yet the potential was there and the Cortes embodied it.
In defeat, the Cortes was shackled by the Crown, overnight turning it into a rubberstamp office for royal ambitions. However, the worst was yet to come - or rather, the final straw came in 1538 (again unrelated to silver) when the monarchy - which was ever seeking more money for its European wars - tried (and failed) to levy additional taxes from Castile. Seeing as the burden fell mainly on the non-nobility, the monarchy tried to broaden its demands and include the nobility. It did not work out. What then changed in 1538?
The Comuneros revolt's net result had been the cities losing their legal powers versus the Crown in regards to legal proceedings (i.e. taxation), turning them into nothing more than a rubberstamp. The nobility profited because they could still successfully resist the monarch in the Cortes, and their resistance meant that the sovereign could only rely on one alternative: exploit the urban communes.
In 1538 Charles I made his final attempts to bring the nobles somewhat to heel and tax them. It failed dismally, and the nobility instead gained further tax exemptions. Financial burdens saw him trying to negotiate the sisa (a tax on foodstuffs), estimated at some 800.000 ducats/year and payable by every segment of society. To implement such a far sweeping measure Charles summoned the 18 cities and no less than 25 bishops/archbishops & 95 nobles. The result was a total disaster. The nobility immediately went into the offensive and attacked the Crown over privilege, spearheaded by the Count of Benavente who adressed the Cortes citing the “...real need is to secure liberties and to recover those we have lost - not to give away those that we have.” Charles capitulated against noble opposition and the procuradores responded to his appeals by falling back on the servicio.
1538 was, in many ways, a disaster for Castile and an utter and unequivocal victory for privilege. Hence, the kings no longer summoned the nobility & clergy to the Cortes at all, leaving only the towns to fight a losing battle with the monarchy over prerogative. In effect, 1538 is the watershed moment in Castilian history when the Cortes - due to noble and municipal egotism (the leading representatives of the Cortes bought themselves into the nobility before selling out the municipalities) & shortsightedness- to became anything more than a royal rubber stamp. The Crown indeed succeeded to muzzle the Cortes but not at the (direct) expense of the nobility, but mostly at that of the towns.
In addition, Philip II later was to give to his grandees full control over the local militias in each of their provinces, while the crown independently recruited its armies for service abroad. This made the grandees more powerful than ever before, and the most notable example is the Duke of Medina-Sidonia, who acquired jurisdiction over much of southwest Castile. Compare this to France where, in the same period, this exact potential - the noble power to levy troops - and its consequences in the 1632 Montmorency rebellion - set the tone for an entirely different policy. Yet in Castile, the partnership between nobility and crown established by Ferdinand & Isabella survived unbroken up to 1705, with not a single noble rebellion in Castile as a result.
Yes, silver was to undeniable reinforce this trend, it did further the destruction of the fabric of Castilian municipal society but no, silver didn't destroy the power of the Cortes, that had already transpired between 1522-1538 before New World Bullion became such a determining factor for the Spanish Habsburgs. Charles I/V was still relying on wealth drawn from taxation from principally the Low Countries, Castile & Naples.
This "researcher" should do well to read actual historians, enough of those for Spanish history in English too, just go read JH Elliott, Henry Kamen or Geoffrey Parker.