[311] Pre-industrial city life represents an economic, social, and cultural milieu different from that of the surrounding countryside and one which seems superficially familiar to investigators from an industrial and urban world. As a result, the city is often viewed as the source of change and modernity and searched for social forces, attitudes, and patterns of behavior that prefigure a modern society and economy. While this approach often identifies the beginnings of modernity, it frequently fails to explain those beginnings or why some cities are slow to produce signs of impending modernization. This is because the pre-industrial city exists not only as part of a larger system of economic and social activity, but is dependent upon the non-urban parts of that system to a degree that is hard for modern individuals to appreciate.
Many modern cities dominate the systems within which they are imbedded; but in an era when over 80% of the people and two-thirds of the gross national product were rural, the autonomy of the city was far less real. The countryside was not devoted to the needs of the city; the city existed to provide goods and services useful to the economically productive countryside. This does not mean that the city did not have a dynamic of its own, nor that it did not affect the rural world around it. It simply means that what took place within the city cannot be understood unless we also understand the complex interconnections between urban and rural components in a basically agricultural civilization.
This study has relied heavily on the concept that urban centers perform a number of economic and social functions for society, and that those functions vary in the distance across which they can be provided effectively. Thus a region such as Castile is serviced by a network of urban centers. Although a few of these centers are quite large, and provide many services, most of them are small and provide only local, short-range services.
[312] Cast in these terms, the heritage of Madrid was a radical
reorientation of the functions that cities performed for Spanish society.
This in turn reshaped the urban system of Spain's interior in a manner
which sacrificed a large part of the limited developmental potential of
the Castilian economy to the maintenance of a political and social system
that subsequently had great difficulty adapting to modern conditions.
I. Sixteenth and Seventeenth Centuries: The Hapsburg Empire
The active urban life of sixteenth-century Castile included a range
of craft industries, local and regional markets, a relatively dense population,
and long-distance trade. Later in the century, as agricultural output stagnated,
food shortages and American bullion pushed up Spanish prices and labor
costs, allowing foreign products to capture Spain's overseas markets and
penetrate her domestic ones. At the same time, rising taxes in a static
rural economy weakened domestic demand and regional exchanges. A fragile
regional economy beset by disease and soil exhaustion was being stretched
beyond its limits. (1)
Meanwhile, the Hapsburg state was attempting to govern a vast military and political system, and in the process developing an alliance with the landed nobility. This group of wealthy families maintained a tradition of military effectiveness and a powerful social and economic position in rural Spain. They were quite pragmatic about their sources of wealth, investing in commerce, commercial fishing, and colonization and often combining Spanish military prowess with Italian investment capital. (2) As the Hapsburg state evolved and the agricultural economy stagnated in the late sixteenth century, if noble investments shifted toward government annuities and offices, urban real estate, and the jurisdictional authority of the Crown.
This alliance of politics and landed class took concrete form in the development of Madrid as a permanent administrative center. Philip II named Madrid as capital in 1561, and gradually the lawyers, clerks, officials, and nobility congregated there. Madrid's development was relatively slow under Philip II, and in forty years the city expanded from about 35,000 to 65,000 inhabitants. Madrid was primarily a political center; industry, commerce, [313] and the economic and social life of the elite continued to center around Toledo and Sevilla. (3) As late as the 1590's, the Castilian urban system had an urban hierarchy that provided complex local, regional, and long-distance markets as well as political and social integration. But Madrid had become a second primary center alongside Toledo, and many lower-order centers were suffering because of subsistence problems and changing long-distance markets. Nevertheless, the sixteenth-century system continued to function.
The next half-century, however, saw a complete reorganization of the urban network and with it a restructuring of Castilian economic life that reduced interregional exchanges and heightened dependence on subsistance agriculture throughout the interior. With the accession of Philip III, the Court became an extravagant and lively place where favors, offices, patronage, and pensions flowed freely. The movement of noble families to the capital accelerated; and after the brief sojourn in Valladolid, "the Court" and Madrid became synonymous. The population of the capital exploded from 65,000 to 175,000 between 1606 and 1630, giving impetus to a building boom.
This rapid growth posed severe
supply problems for the Crown, and the solutions had serious implications
for Castile. (4)
Urban needs were confronted by a densely populated and inelastic agricultural
hinterland in a precarious equilibrium. Each poor harvest was harder for
supply officials to overcome than the last, forcing constant expansion
of the area that Madrid sought to control. The embargo of more and more
supply zones absorbed the sources of supply for Toledo, the principal urban
center of the interior until 1608. This redirection of supplies away from
Toledo created shortages and high food prices, aggravating Toledo's marketing
problems by forcing up industrial wages. The array of controls included
ceiling prices on grain as it left the farms, embargoes on grain shipments
to destinations other than Madrid, adjustment of bread prices to draw it
to Madrid, and bread delivery schedules imposed on towns up to 40 miles
away. The effectiveness of price control (the notorious tasa) has
long been questioned, but it apparently was taken seriously through the
critical first third of the seventeenth century. (5)
The effect was to preclude the small producer from benefiting from high
wheat prices in bad years, when he had to buy rather than sell, while good
harvests meant low prices and a modest return for his surplus. Meanwhile,
those able to store surpluses in good years could wait and sell in short
years on favorable [314] terms. This undermined the small farmer
and encouraged consolidation of landownership. (6)
Moreover, as wheat became
expensive, urban buying power shifted and per-capita use of wine declined.
Consequently, while five-year average wheat prices rose 90% from 1590 to
1610, wine prices fell 25%. As a result, the wine-producing districts of
New Castile declined rapidly after 1590. (7) Between
1600 and 1630, therefore, the rise of Madrid turned the normal variations
in harvest yield into a spiral of recurrent food shortages and high prices,
rural distress and dislocation, and migration to the capital. Each new
crisis required stronger efforts to supply the city, further exacerbating
the developing rural crisis. This was paralleled by the final collapse
of the urban hierarchy between 1610 and 1630, leaving Madrid as the only
significant market for agricultural surpluses in Old and New Castile.
As an economic center, Madrid
was qualitatively different from Toledo and displaced its function as moderator
of a complex exchange network. Madrid exported political services (government)
in return for taxes and revenue. This attracted resources from the empire
beyond the immediate hinterland. Madrid also functioned as a nexus providing
the wealthy elite with social integration and access to the wealth of the
state. To enjoy this amenity, such families moved to the city, bringing
with them the rents from their estates. This produced a consumption-oriented
market and extreme inequalities in the distribution of income that prompted
the state to subsidize urban supply for the sake of public order. This
provided an income for those who controlled disposable commodities in the
countryside, lubricating the flow of taxes and rents back to the capital.
Much of the money never left the city, being paid by urban officials and
contractors to rentiers living in the city in return for the sale of landed
income received as agricultural products and brought to the city.
At the same time, Madrid's
narrow market locked urban crafts into quality-oriented production that
further separated the city from the hinterland, which could afford few
luxuries. The city increasingly attracted long-distance trade from the
seaports; and as income became more concentrated, the preferences of the
elite became more cosmopolitan and the city purchased an increasingly narrow
range of goods from its own hinterland. Thus the city provided a kind of
cash economy for the landed elites, while encouraging a more rudimentary
and self-sufficient rural economy. (8)
This change in the [315] nature as well as the location of urban
demand helped to undermine rural economies that had specialized under demographic
pressure in the sixteenth century, only to lose their markets in the seventeenth.
In one short generation,
Madrid had acquired a near monopoly on the provision of higher-order political
and social services for the Spanish elite. In the process, the capital
coopted the resources that might have allowed other cities to provide the
exchange functions needed to integrate the rural economy. Thus the only
large market of the interior depended heavily on state and rentier income.
Madrid's primacy was no sooner
established, however, when it suffered a serious decline in the resources
that the state could provide. By the 1630's, American bullion remittances
accessible to the Crown were falling dramatically. France entered the Thirty
Years War in 1635, expanding Spain's military budget to colossal proportions.
The situation became even bleaker when Catalonia and Portugal revolted
in 1640, followed by Naples in 1646. The hard-pressed government reordered
budget priorities, exploited the monetary system, and raised taxes. The
new taxes in the 1630's took the same form as earlier sisas levied
for public works, but were dedicated to servicing loans raised for European
campaigns. Madrid had lived from a set of institutions that channeled public
and private wealth to it. But the new taxes, instead of reinforcing that
flow, reversed it. The impact on the city's economy was evident by the
mid-1630's, when consumption of wheat, wine, meat, and olive oil began
to decline. The government also sought to tax the nobility, and captured
much of their income by selling them jurisdiction over hundreds of villages.
The Crown thus surrendered much of its rural authority and, having made
Madrid the preeminent city of the interior, caused a major contraction
of the market that the city represented, furthering the withdrawal of the
countryside into self-sufficiency. (9)
By the later seventeenth
century, the Spanish economy had undergone sweeping reconstruction.
(10) Excepting Madrid,
the former cities had become large towns, and many provinces were left
lightly populated and barren. Agriculture had withdrawn to the better land
and emphasized cereals with local markets and lower labor requirements.
(11) Intrinsically more valuable [316] and mobile products
were stressed, along with an expansion of grazing.
(12) Land had become
concentrated in the hands of the aristocracy and Church, and sharecropping
and day labor were more prevalent. Total output had declined, and the distribution
of wealth favored the elite. The basic lines of Spain's rural society for
the next 250 years were emerging: sharply unequal distribution of wealth,
estate management and control of local jurisdiction by the señor
and labrador rico, self-sufficient agriculture, and limited markets.
By 1700 Madrid and Castile were locked into a rigid relationship, while
the periphery continued to show varying responses to external forces.
Once again there was a correlation
between the fortunes of the Spanish empire and those of its capital. Before
1715, imperial reforms were tentative; (13)
but after the War of the Spanish Succession, relations with France [317]
were regularized and the higher administration was reorganized. The late
1720's saw renovation of the Spanish navy and restriction of smuggling
and privateering in the Caribbean. The empire was recovering; renewed silver
production provided Spain with vital foreign exchange; and by the second
quarter of the eighteenth century, population and consumption began to
rise in Madrid. After hovering around 120,000 inhabitants until after the
War of Succession, population rose to 150,000 inhabitants in the 1750's,
180,000 in 1787, and 195,000 in 1799. (14)
The growth of the capital constituted an important dynamic factor in the
economy of the peninsula. The market value of imports into Madrid in 1789
was well over 400 million reales, half the estimated value of imports
and exports at Cádiz and considerably more than the 250 million
reales that Pierre Vilar attributes to Barcelona.
(15)
In Chapter 6 we analyzed
the structure of the urban market behind the estimated total value of what
the city consumed, indicating that it involved a massive imbalance in trade.
The overall coherence of the economic structures that supported the city
can only be appreciated if we understand clearly the role of political
and rentier income in maintaining them. To compensate for the goods consumed
by the capital, some combination of goods and services had to be exported.
Ultimately, the services that compensated for the trade deficit were government
(imperial and peninsular policy-making and administration), rural management
(theoretically a function of landlords resident in Madrid), and provision
of a focal point for Spanish elite socialization, culture, and definition
of status. Some of the exchange of goods for services was direct. The Crown
owned extensive estates from which it directly mobilized revenue in kind.
It also controlled two-ninths of the tithe in much of Spain. This income
in kind was managed administratively to supply the military and the capital
city. Similarly, many noble families and religious institutions had estates
from which supplies were brought directly to urban palaces, convents, and
monasteries.
Most of the process of paying
for urban supplies involved sales and monetary transfers. The services
created by the capital "earned" payments in the form of taxes, rents, and
endowment income. This income passed through the internal economy of the
city, then flowed outward again to pay for the goods the city required.
The origin of these incomes provides an important key to the city's relationship
with its hinterland and the larger political system.
By the 1780's, government
outlays associated with Madrid were about 200 million reales a year,
nearly a third of the Crown's net revenues. Almost half [318] of
the money went to support the royal household, its palaces, hundreds of
servants, and extensive stables. The remainder went to over 5,000 state
employees and the 7-10,000-man garrison and royal guards.
(16) The revenues
brought to the city privately clearly exceeded the contributions of government:
a combination of hearsay and documentation suggests that the combined income
of the Alba, Berwick, Arcos, and Infantado families alone reached 20 million
reales at the end of the eighteenth century. As we saw in Chapter
4, the titled nobility in Madrid had an admitted rental income of over
144 million reales in 1808, and an annual income of 880,000 reales
was considered modest for a grandee at court. The census of 1797 registered
57 grandees and 68 other titled nobles in addition to over 300 owners of
lesser entailed estates and several thousand nobles residing in the city.
The bulk of those revenues went into salaries, legal fees, living costs,
and interest payments dispersed in the capital. These señorial revenues,
combined with even a modest estimate of analogous ecclesiastical ones,
more than match the contributions of the state to the urban economy.
(17) Thus public and
private flows of revenue into Madrid easily cover the massive deficit in
the balance of trade. To many observers, the pattern is a measure of how,
while Spain was exploiting America, Madrid and its elites were exploiting
Spain. (18)
These basic facts about Madrid's
economy help us to understand the contrast between the impact of the Spanish
capital and that of other cities upon their surrounding provinces. The
city's rate of growth was substantial, but below that of London in the
same period and less than half of the 180% increase in the population of
Barcelona. (19)
Madrid's moderate growth, combined with her economic structure and the
government's willingness to subsidize traditional supply organization,
did not stimulate much reorganization of rural economic life. The principal
response was one of adjustment within the structure of production that
had emerged in the seventeenth century with the breakdown of the urban
hierarchy, and it is hard to separate the rural response to urban demand
from adjustments to rising rural population. Movable [319] surpluses
may actually have shrunk, and the city had to develop a remarkably widespread
network in order to satisfy its needs. (20)
Urban-rural interaction around
Madrid was further constrained by the city's connection with the maritime
economies of the Spanish world. Roughly 40% of Madrid's trade consisted
of goods from outside the Spanish interior that fed the city.
(21) The regionally
produced commodities were primarily food and fuel for the low-income portion
of the population, and there was almost no interaction between the two
market structures which met at the city gates. The location of the city
prevented the commerce of Madrid from offering entrepot services to the
interior, and it remained cheaper for rural communities to use the slack
periods in the agricultural economy to trade directly with the seaports
for the little merchandise they could afford. Unlike London, Madrid could
not provide cheap imports to the countryside, stimulating rural production
by offering improvements in the rural standard of living.
(22)
Until the later eighteenth
century, the rate of growth of the city's own needs was accommodated within
the traditional economy. Madrid's distribution of income meant that urban
prosperity brought increased emphasis on imports, and declining real income
for most city-dwellers. This shifted the demand for products from the interior
toward a narrow range of agricultural commodities. This is suggested both
by the volume of consumption of various commodities and by the changing
distribution of gross revenue within the market for Castilian staples.
At the same time, the government discouraged intensification of agriculture
near the city by encouraging rural grain reserves and accepting the higher
costs of a wider radius of supply based on the existing rural arrangements.
These conditions did not,
however, preclude the development of an urban economic elite which increasingly
preferred market to administered economic decisions. This urban elite adopted
many tenets of Liberal economics relative to the marketing of primary products,
while remaining tied to traditional structures of production in the countryside.
The logic in this is apparent when we recall the nature of the revenues
that supported Madrid and its rentier elite. The result was the paradoxical
situation of a growing city that encouraged stagnation in the rural economy
around it.
The reduction of direct government
interference in the supply trades is apparent in many ways. By the eighteenth
century, there is no evidence of control of rural bread prices or of embargoes
directing the movement of wheat. The ceiling (tasa) on the price
of grain leaving the farm was not [320] enforced and was formally
abolished in 1765. When crops were adequate, most of the grain entering
the city came through market operations at prevailing prices. In the background,
the wheat depot continued to monitor the market and to supplement supplies
so as to dampen price movements. This entailed development of a considerable
administrative mechanism that arranged contracts with suppliers in La Mancha,
maintained a system of purchasing agents and depots throughout Old Castile,
regulated the supply of transport services in Castile, and provided a third
of Madrid's wheat by 1790. Thus the government oversaw rather than directly
administered a large share of the wheat supply and, even where control
was more direct, deferred to market prices in the supplying regions.
The gradual withdrawal of
the state, while far from total, was apparent in other supply trades as
well. (23)
The wine supply had evolved into a system of government licenses for several
purveyors, while most of the ostensibly monopolistic concessions contained
provisions for interlopers in the market. The concessions themselves provided
speculative opportunities for a variety of contractors, partnerships, and
established entities like the Cinco Gremios Mayores. By 1800 the
government was skeptical of the cost of supply administration, and in 1805
sold off the entire charcoal system. Thus, although the eighteenth-century
state played an active role in the supply of Madrid, the drift was toward
a market-driven commerce involving private entrepreneurs--an arrangement
made possible by the politically and rentier-supported urban economy.
The nature of the business
world behind these eighteenth-century developments has not been examined
carefully and is probably obscured by the formal categories of Old Regime
society. For instance, we know little about the pressures behind the reform
of the grain trade in the 1760's. It is sometimes treated as an ill-conceived
application of physiocratic ideas by doctrinaire reformers;
(24) but given the
inelasticities of supply imposed by transport and weather, a freer system
clearly benefited rentiers and middlemen able to withhold grain from the
market. If the nobility of eighteenth-century Toulouse could see this and
espouse free trade, it should not be startling to see landed elements in
Castile reacting in the same way. (25)
Indeed, there are numerous other indications that the elites in Madrid
were forming economic interests and attitudes that cut across traditional
class and status distinctions. This was not a narrowly urban process, but
reached across the countryside via agents, commodity fairs and markets,
merchants, and market-oriented [321] estate management to touch
estate managers and the labradores ricos who dominated village politics.
Rentier concern for profitable
investment is also apparent in the flurry of interest in joint-stock trading
companies, and a wide variety of noble families participated as stockholders
in the Zaragoza, Toledo, Granada, and Extremadura companies.
(26) Most of the companies
foundered, but at least one, the Caracas Company, was successful for 60
years. (27)
Noble participation in commercial activity, obviously not an alien concept
for the second estate, intersected with the activity of the Cinco Gremios
Mayores. An agency of the commercial patriciate of Madrid, the Cinco
Gremios dominated wholesale and retail trade in manufactures in the
capital and were involved in the same joint-stock companies. Their Compañía
General de Comercio, founded in the 1760's, managed royal factories,
farmed important taxes, traded with America and the Philippines, and at
times supplied both the army and the capital. By 1790 the company had accumulated
over 300 million reales in deposits, which were used to extend credit
to public and private customers. (28)
These activities suggest numerous points of contact between the various
wealthy elements of the interior.
By the 1780's, the Banco
de San Carlos, predecessor of the Bank of Spain, was functioning, with
a long list of stockholders from a variety of social groups.
(29)The bank in turn launched the grandiose Real Compañía
de Filipinas, which absorbed the Caracas Company and was to undertake
overseas trade, supply credit to the Crown, and construct interior canals.
(30) This is further
evidence of the mutual concerns of commercial and landed elements for mobilizing
the products of the interior, as well as participating in the Atlantic
trade. These common concerns were proclaimed through the Economic Societies,
an amalgam of landed and urban interests espousing modernization and improved
interior commerce and transport. (31)
The economic modernity of
Madrid's elites had important limits, however. [322] Commercialization
of commodities accumulated as rents and tithes does not necessarily stimulate
change in the rural society producing them. In Castile, it led to competition
for control of traditional rents and tithes within the pattern established
in the seventeenth century. The dependence of commerce on Madrid and the
wool trade reflected the stagnation of the other cities in the interior
and the one-sided nature of the countryside's trade with the capital. Lacking
convenient urban markets and services, and without adequate transportation,
the response of the rural population was shaped more by rural conditions
than by demand from Madrid.
Moderate population growth
produced some signs of rural prosperity in the middle decades of the eighteenth
century, but the interior cities were little affected. Toledo, Albacete,
León, Ávila, Benavente, and Segovia appear virtually stagnant
until 1770, with at best moderate and temporary expansion thereafter. A
certain amount of enclosure went on, and there are indications of some
concentration of enclosures near Madrid, but signs of increased large-scale
farming or intensive techniques are scarce. The volume of movable agricultural
commodities rose primarily because enclosure of land for farming created
new tenants who added to the flow of traditional rents and tithes. Evidence
of diminishing returns suggests the extension of traditional farming onto
less fertile land. (32)
Consequently, the sale of larger quantities of produce at Madrid had little
effect on rural buying power, and hence the stagnation of local centers.
Indeed, most of the rewards from the supply trades ended up in the pockets
of absentee landlords, tax collectors, tithe collectors, and supply agents
often resident in the capital.
This perception of the rural
economy is reinforced by the history of consumption in Madrid once the
seventeenth-century reorganization of the urban hierarchy was complete.
The rapid increase in olive oil consumption was possible because the seventeenth-century
response to declining population and demand was a shift to such low-labor,
high-value commodities, and meshed with the concentration of buying power
in the city which created a relatively stable market for items of elite
consumption. The parallel shift to grazing similarly explains how, by 1800,
Madrid was able to consume more meat per-capita than any other large city
in Europe.
The seventeenth-century loss
of markets and labor dismantled the commercial wine industry of New Castile.
As a consequence, wine became relatively expensive, total urban consumption
rose slowly, and per capita use fell below half the early seventeenth-century
level. Moreover, to provide for a much smaller annual consumption it proved
necessary to extend the supply region far south into La Mancha, an area
only marginally important before [323] 1650. The districts that
had once produced wine for Toledo and Madrid did not respond to renewed
demand. Nor did New Castile respond to stronger demand for cereals. Important
amounts continued to come from all over New Castile, but far less than
in the sixteenth century, and the scanty evidence shows declining production
in many areas around Madrid and Toledo between the 1730's and the 1780's.
Occasional recourse to Old Castile and Andalucía for wheat gave
way to an elaborate procurement system in Old Castile in order to meet
the city's regular needs.
Logically, renewed urban
demand should have shifted the region back toward cereals and vines. The
failure of New Castile to respond in this manner is associated with structures
that separated the actual farmer from market forces outside the immediate
locale and enforced a very uneven distribution of rural wealth. As population
rose, plots got smaller and smaller, and peasants were caught short in
subsistence crises--and pushed into wage labor--which encouraged them either
to emigrate from the villages or to develop extremely marginal farming
patterns. (33)
Yet this organization of production was so much bound up with rural power
that the risks to the elite inherent in changing the organization and providing
direct incentives to the peasant outweighed the long-term collective benefits
of increased total production. (34)
Thus the controlling elites, while behaving in an increasingly "modern"
fashion in dealing with the wealth extracted from rural society, continued
to maintain traditional arrangements within that society. In Castile, commercialization
of necessity focused on Madrid, creating a community of interests between
rural and urban elites. This pattern helps explain the apparent ambivalence
of eighteenth-century domestic reforms in Spain. "Enlightened" elites often
supported "liberal" reforms, such as free internal grain trade, better
roads, rural industry, credit facilities, and modernization of maritime
commerce and imperial administration. At the same time, they resisted serious
land reforms and maintained policies of social control that made it pointless
for the peasant to improve yields, because the results would quickly be
lost as rent. (35)
[324] Thus the largest
single center of commercial and industrial activity in eighteenth-century
Spain was entirely dependent upon the political structure of the empire
and the landed wealth of the peninsula. The counterfactual implications
of this are intriguing, given that in less isolated areas such as England,
or even Spain's own Basque provinces, landed elements did respond to new
investment opportunities. One of the reasons offered for the prominence
of conspicuous consumption and swollen staffs of retainers in the Spanish
aristocracy was the lack of more profitable investments. In eighteenth-century
Madrid, the most common high-security investment other than land was apparently
"loans" (actually savings deposits) to the Five Greater Guilds, which paid
only 2.5% until after 1780. (36)
Had the potential market and investable capital of Madrid been concentrated
in a city such as Lisbon or Sevilla, with much greater potential for commercial
and industrial enterprise, the pattern of economic development in Spain
would have been significantly different.
Madrid's economy can now
be fitted into the larger perspectives suggested earlier. The capital depended
on the Spanish interior for over half of its income and for its basic supplies.
Through the state and the señorial system, taxes and rents were
collected in the countryside. These flowed to the city, financed one-way
flows of commodities to Madrid, and thus returned to the countryside, completing
the circular flow of a largely autonomous and essentially static economy.
The weakness of the impact on rural society is heightened by the fact that
in practice the payment for rural products often passed directly to rentiers
within the city. The actual city-country relationship in that case was
a one-way shipment of rural products to the urban market. Any purchasing
power thus created was retained within the consumption-oriented economy
of the capital city. At the same time, the capital was dependent upon the
imperial system as the source of much of the revenue that subsidized the
costs inherent in the city's location, thus providing a focal point for
wealth captured by the landed elite. In its turn, this dependence on distant
sources of wealth financed much of the trade between Spain and Europe,
discouraging the diversification of the interior by directing urban demand
elsewhere. (37)
Nevertheless, the elite of
Madrid and the interior strove to reinforce the structures of the traditional
interior. They backed protective agricultural tariffs, free trade in non-agricultural
imports, control of colonial markets for agricultural exports, a strong
Church, limited franchise, and limited education. The "liberal" elements
of the coasts sought free entry of foodstuffs, tariffs to protect industry,
control of colonial markets for manufactures, extensive and secular education,
and a broader franchise. The structural bases of these differences meant
that issues could easily become polarized along sectional lines and create
serious disruption in the form of revolution and civil war.
Inevitably Madrid was a central
feature of the structures that typified the interior, although other factors
were also at work. Castilian agriculture expanded considerably in the 1840's,
and it is an open question whether it was due to sale of entailed lands,
to gradual penetration of market forces, or simply to better documentation
of the effects of increased rural population. (39)
In any case, export surpluses appeared, and the problem of bread that governed
the budgets of Madrid's poor was eased. In the wake of this stabilization
of its bread supply, the capital city renewed its demand for other agricultural
commodities. Thus meat, wine, and olive oil consumption increased, despite
rising prices for the last two. The nineteenth-century capital not only
contributed to the long-term expansion of olive culture in the south, [326]
but absorbed a growing volume of meat and, more significantly, began to
recover as a domestic market for viticulture.
The disentailing of Church
lands may have stimulated agricultural production in Castile,
(40) but it can be
argued that this reflected more basic politico-economic developments. In
addition to long-term rural population growth, the 1840's saw reestablishment
of an effective state controlled from Madrid by Madrid-based interests.
This produced tax reforms and an increase in the budget dispensed from
the capital. At the same time, economic policy created captive markets
in Cuba and in the peninsular seaports. Paying for Castilian products with
colonial goods or manufactures, these markets provided a pale reincarnation
of eighteenth-century patterns. Once again, empire meant commerce and a
prosperous capital city. This was the context for land sales, and for a
few years the response allowed a grain trade to Cuba and stable bread prices
in the capital. This meant that Madrid's renewed prosperity could turn
into demand for other products of Castilian agriculture. This was a brief
phase broken by serious shortages in 1857-58, a crisis in the remnants
of the empire, renewed instability of urban supply, and another breakdown
in the centralist structure of power. By the mid-nineteenth century, little
had happened to solve the long-standing problem of low rural productivity--an
indication of the marginal impact of land reform, restoration of an imperial
subsidy for domestic commerce, and the coming of the railroads. Structural
contrasts remained to complicate Spanish politics well into the twentieth
century. (41)
Basic economic realities
included an endowment of resources that dictated a dispersed, low-yield
agriculture or livestock-raising in the interior.
(42) Transportation
was caught in a technological deadlock that left the transport system of
1850 little better than that of 1790, and maintained regional isolation.
(43) Prices reveal
recurrent crises and sharp regional contrasts as late as 1880. In 1865-68,
for example, wheat prices rose up to 190% in the interior but only 60%
in the coastal provinces. This illustrates a profound lack of economic
integration long after the period during which the nineteenth-century oligarchy
was supposedly forming. (44)
Consequently, the commercial activity of the interior remained restricted
to import of a small volume of manufactures, mostly for Madrid, and sale
of agricultural products to controlled markets in Cuba, the coastal towns,
and Madrid.
[327] None of this
represents a significant structural change since the eighteenth century.
Regional price differences in 1867 were virtually identical to those of
1790. (45)
Except for the decline of wool exports, the pattern of commerce in the
Castilian interior was basically that of the eighteenth century, with limited
exports and manufactures and luxuries supplied to Madrid from Barcelona,
Bilbao, and Europe. Agricultural commodities were more uniformly accumulated
as rents rather than tithes, or through direct management, as in the cases
of livestock or charcoal, before they moved into supply systems focused
on Madrid. The changes of a century seem modest. By the 1860's Madrid was
perhaps 50% larger than in 1800, but was still under 300,000 inhabitants.
Its demographic structure was unchanged, income distribution had worsened,
and urban function was more narrowly political and residential. More and
more of the goods demanded by the affluent of the city were produced outside
the Castilian interior. Traditional industry in central Spain and in Madrid
declined, forcing the countryside into heavier reliance on basic agriculture.
(46)
Such changes in the economic
framework of the interior seem an inadequate explanation for the agro-commercial
oligarchy of nineteenth-century Spain. Unquestionably, Spain saw rapid
changes in the formal definitions of society and economy and their institutions
after 1833. The sanctions behind the state were secularized, and the monarchy
became constitutional. Traditional law codes were replaced by modern "liberal"
ones, and the old estates with prescriptive rights were officially dismantled.
The legal context of commerce was modernized, removing obstacles to the
free movement of goods. Land became a commodity in the classical Liberal
sense, as entail was abolished, Church and municipal lands were sold at
auction, and resources were freed for optimal use, as defined by Adam Smith's
invisible hand. (47)
Given the permanence of underlying
economic conditions, however, we must be careful about seeing in this a
"revolution" by a "conquering bourgeoisie" such as Morazé depicts
for France, and we must not make too much of the mobility into the elite
that appears in the mid-nineteenth century. (48)
If the protagonists are "bourgeois," it is within a socio-economic context
more reminiscent of eighteenth-century Madrid than nineteenth-century France
or England. Since land and status were still connected, it would be remarkable
if the great land sales had not produced candidates for noble title. It
is worth noting that the number of entries into the nobility in the seventeenth
and [328] eighteenth centuries was also not inconsiderable.
(49) Most of the legal
and commercial reforms formalized in the nineteenth century had been discussed
and even begun in the eighteenth. The sale of religious endowments was
started by the Old Regime, and it never brought a significant land reform.
Rather, the nonclerical segments of the agro-commercial oligarchy got less
ambiguous control of more land at the expense of religious institutions.
This meant that more land was in "bourgeois" hands, but the beneficiaries
were already part of a network of interior commerce and estate management
that had common interests with older landed elements. The lawyers, professionals,
and speculators who are cited as the vanguard of bourgeois capitalism by
some writers were really part of an urban-rural continuum in which most
economic life was closely tied to land and agriculture.
Life in the countryside saw
even less change. The amount of land under wheat expanded, as did total
output, but yields per acre declined, indicating that traditional methods
of production were being applied to lower-quality land.
(50) Whoever the landlord
may have been, and whatever his relationship to the market, relationships
between landlord and tenant or laborer changed little, and production was
not significantly capitalized. Market-oriented rentier class and self-sufficient
peasantry persisted together through the nineteenth century in a balance
that depended on the Madrid market. (51)
Thus nineteenth-century Madrid
remained fundamentally elitist, dominated by a small, wealthy upper class
and populated by rural and urban masses no better off than 100 or 200 years
before. If one looks at sources and distribution of wealth in Spain, the
structure of the nineteenth century looks very like that of the eighteenth.
(52) The process follows
closely the model discussed by Robert Brenner for the impact of a city/market
on a "serf-society." Despite an air of modernity, maximizing attitudes
can freeze or restrict change in rural production, limiting city-country
interaction because of the shape assumed by the overall market. The result
is a city limited by the rural product that can be "captured."
(53) The unique thing about Madrid was its access to a transregional
power base that made possible a widespread regional system of "capture."
[329] This suggests
that the origins of the agro-commercial oligarchy of the nineteenth century
are to be found in the association between Madrid and its hinterland that
was stimulated by the growth of the city in the eighteenth century. The
changes of the nineteenth century reflect shifts in alliances and land
control within the elite, and a recasting in Liberal terms of the rationales
by which the rentier elite justified its preeminent position. Through land
purchases, intermarriage, and the political alliances made possible by
the Moderado state, barriers between título, hidalgo,
rentista, and labrador rico were blurred, bringing greater
coherence to the landed elites. (54)
The Moderado state and its constitution of 1845 have justifiably
been characterized as the codification of an elitist liberalism in the
service of the evolving oligarchy. (55)
The alliance of state and
oligarchy was reinforced by yet another factor, which also served to attract
resources to the state and its capital. Beginning in the 1790's, Spain
drifted into recurrent balance-of-payments deficits and massive government
debt. This diverted large quantities of capital to state finances in support
of a power structure that perpetuated the dominance of Spain by Madrid
and Castile. The great land sales were inseparably linked to the problem
of public debt; and the perception of land and the state as secure, if
low-yield, investments reflects traditional attitudes. For all of its involvement
with capitalism, railroads, gas lighting, and Church expropriation, the
elite of middle and late nineteenth-century Madrid were not so much something
new as the end product of over two centuries of economic, social, and institutional
evolution in the interior of the country. (56)
What did change in nineteenth-century
Spain was the structural relationship between capital city, country, and
empire--a change that pushed to the center of the political stage those
economic and social elements of the eighteenth century whose fortunes best
survived the catastrophe of imperial collapse between 1800 and 1825. It
is hardly surprising that the elements that had long been coalescing around
the one-way commerce between the Castiles and Madrid came to dominate the
Spanish state. Already in the seventeenth century, Madrid had become the
dominant city of the country--a city in [330] which most commercial
life consisted of final distribution rather than the transformation of
goods or creation of value-adding commercial services, and a city in which
most incoming wealth belonged to an agricultural elite and those who serviced
that elite. In the nineteenth century, the loss of empire crippled maritime
commerce and government finance, leaving the complex of Madrid rentiers,
suppliers, and middlemen relatively more important in the national political
and economic framework. A greater share of government revenue had to come
from interior sources, while the agricultural sector replaced the Indies
trade as the preeminent source of wealth. (57)
The collapse of imperial and foreign trade, which fell 75% between 1792
and 1827, (58)
drastically weakened the port cities, leaving Madrid in a position of relatively
greater importance. Despite the midcentury land sales and some response
to market pressures, little occurred to alter the basic interactions between
capital and country. Madrid emerged politically and economically dominant
within Spain, shaping events to meet its own needs.
1. Bartolomé
Bennassar, Recherches sur les grandes épidémies dans le
nord de l'Espagne a la fin du XVIe siécle; Domínguez
Ortiz, Siglo XVII, vol. I, pp. 53-160; Gentil da Silva, En Espagne,
pp. 97-189; Noel Salomón, La campagne de Nouvelle Castille á
la fin du XVIe siécle, pp. 303-304; Vicens Vives, Manual,
pp. 373-393. Aspects of this are discussed in Chapters 8, 9, and 10.
Ruth
Pike, Enterprise and Adventure: The Genoese in Seville and the Opening
of the New World (1966), and Aristocrats and Traders; Sevillian
Society of the Sixteenth Century (1972); Charles Verlinden, "Italian
Influence in Iberian Colonization" (1953), pp. 199-211, and The Beginnings
of Modern Colonization (1970), pp. 113-157.
Domínguez
Orúz, Siglo XVII, pp. 129-139; Weisser, "Les Marchands de
Toléde."
Aspects
of this are inferred in Weisser's "Crime and Subsistence: The Peasants
of the Tierra of Toledo, 1550-1700." The specific problems are documented
in Chapter 11 above.
Earl
Hamilton, in both American Treasure and War and Prices in Spain,
1651-1800, p. 98, maintains they had little effect. Carmelo Viñas
y Mey, in El problema de la tierra en la España de los siglos
XVI-XVII, assumes considerable impact. If Segovia was typical, the
tasa governed large sales well into the seventeenth century: Anes and
LeFlem, "Las crises del siglo XVII," pp. 22-23.
See Chapters 3 and 6. The pattern
follows Ernest Labrousse's formulation, in Fluctuaciones económicas
e historia social (1962), pp. 371-379, regarding the prerevolutionary
decades in France.
II. The Eighteenth Century:
Bourbon Revival
If in the seventeenth century
Madrid had contributed to the de-urbanization and isolation of rural society
in Castile, in the eighteenth it played an equally important role in turning
wealthy families into the agro-commercial oligarchy that dominated Spain
in the nineteenth. As the trade that supplied Madrid evolved, the political
and economic elements which dominated Spain were changing their concept
of a "normal" framework for economic life. The ideas of French physiocracy
and English liberalism were pervasive and influential, and from the mid-eighteenth
century they were cited with increasing frequency and explicitness by the
highest authorities. Thus when crisis disrupted old arrangements, their
replacements were well established as partial reforms and ideas familiar
to the political class of the country. The commercial and financial sectors
of Madrid's society were becoming larger and more sophisticated as they
captured functions previously dominated by the state. Concurrently, the
rentier elements controlling agricultural products were being drawn into
interaction with the evolving market, its premises, and the men who operated
it. The developing community of interests included not only urban middlemen
and wealthy nobles of the capital, but also provincial notables, estate
stewards, and the wealthy peasants who dominated many villages, thus incorporating
the central elements of the Moderado state of the nineteenth century.
III. The Nineteenth Century:
An Era of Retrenchment
Our perception of Madrid
and Castile in the eighteenth century provides valuable perspective on
the agro-commercial oligarchy that became the basis of the dominant Moderado
party after 1833. This oligarchy is conventionally [325] described
as consisting of landed nobility, "bourgeois" owners of disentailed Church
and municipal lands, speculators in railroads and urban real estate, the
army officer corps, and wealthy commercial families. This elite and its
political opposition are often depicted as part of a structure of horizontal
and national classes, (38)
but that perception of Spanish society is anachronistic. Only for the twentieth
century can a case be made for class conflicts that have national coherence.
In the nineteenth century, the basic cleavages reflected well-defined geo-economic
patterns. Certain coastal areas persistently opposed the policies of the
dominant oligarchy, and only in those areas did industrial working and
middle classes develop. Interior and coast still confronted different economic
realities that offered little room for compromise. This is not to deny
that coastal areas like Galicia and Asturias maintained traditional economic
and social structures, but they did not have to cope with the extremes
of subsistence crisis common in the interior. Nor does it deny that as
an urban center, Madrid imported many elements of modernity and developed
social groups accordingly.
23. See the detailed discussion of supply arrangements in Chapter 7.
24. Vicens Vives, Manual, pp. 467-470.
25. Robert Forster, The Nobility of Toulouse in the Eighteenth Century (1971), pp. 70-72.
26. For an account of the Toledo Company, with some references to others, see Larruga, Memorias políticas y económicas, vol. 7, pp. 59-418, and vol. 8, pp. 1-94. See also William J. Callarían, "Crown, Nobility, and Industry in Eighteenth-Century Spain" (1966).
27. Roland Dennis Hussey, The Caracas Company, 1728-1784(1934).
28. In 1775, the operating capital of the five participating guilds was estimated at 209 million reales. Capella Martínez and Malilla Tascón comment, in Los Cinco Gremios, pp. 17, 124, 315-316, on the growing sophistication of their business activities. By the end of the century, the Compañía de los Cinco Gremios had accepted deposits (technically loans) amounting to 397,994,401 reales. See also Vicens Vives, Manual, pp. 522-524.
29. Earl Hamilton, "Plans for a National Bank in Spain, 1701-1783" (1949), "Foundation of the Bank of Spain," parts 1 and 2 (1945 and 1946), and "El Banco Nacional de San Carlos, 1782-1829" (1970).
30. María Lourdes Díaz-Trechuelo Spinola, La Real Compañía de Filipinas (1965).
31. Robert Jones Shafer, The Economic Societies in the Spanish World, 1763-1821 (1958).
32. See Chapter 9. The carters' associations complained of enclosure of their reserved pastures for sheep and tree-planting, but only occasionally for agriculture.
33. Ester Boserup, in The Conditions of Agricultural Growth: The Economics of Agrarian Change Under Population Pressure, chs. 4 and 5, discusses some of the "low-income" traps possible under such circumstances.
34. The situation may have resembled that discussed by Alfred Cobban for France, where feudal dues and rent collections, rather than the actual exploitation of the land, were commercialized. Relative to Spain, Fontana Lázaro cites as causes of low productivity the lack of an internal market and the inefficient management of a large share of the land by the clergy; he explicitly rejects Cobban's type of analysis. See Cobban, The Social Interpretation of the French Revolution (1965), pp. 25-35; Fontana Lázaro, La quiebra de la monarquía absoluta, pp. 39, 48, 52.
35. Vicens Vives, Manual, pp. 472-474. On the resistance to reduction of the nobility's jurisdictional powers in the late eighteenth century, see Manuel García Pelayo, "El estamento de la nobleza en el despotismo Ilustrado español" (1946), pp. 45-49, 59.
36. Domínguez Ortiz, Siglo XVIII, p. 90; Capella Martínez and Malilla Tascón, Los Cinco Gremios, pp. 262-263.
37. These preferences were strongly oriented toward French customs and luxuries. See J. F. Bourgoing, The Modern State of Spain, vol. 2, pp. 308-309. On regional polarization, see C. A. M. Hennessy, The Federal Republic in Spain: Pi y Margal and the Federal Republican Movement, 1868-74 (1962).
39. Miguel Arlóla, La burguesía revolucionaria, 1808-1869, pp. 58-78, 107-112; Richard Herr, An Historical Essay on Modern Spain, pp. 93-94; Pedro Voltes Bou, Historia de la economía española en los siglos XIX y XX (1974), vol. l, pp. 117-138.
40. Raymond Carr, Spain, pp. 275-276.
41. Ibid., pp. 280, 290-300, 547-557; Vicens Vives, Manual, p. 311, Sánchez-Albornoz, España hace un siglo, chs. 1, 2, 3, and 5.
42. Carmelo Viñas y Mey, "Apuntes sobre historia social y económica de España," pp. 35-38.
43. Ringrose, Transportation, pp. 135-136.
44. Sánchez-Albornoz, España hace un siglo, pp. 46-56, and a paper, "Mercado nacional, dualismo y ruptura: Los precios del trigo de España durante la segunda mitad del siglo XIX."
45. Anes, Economía e "Ilustración" en la España del siglo XVIII. pp. 43-70.
46. Carr, Spain, pp. 264-277; Fernández García, El abastecimiento de Madrid, chs. 3,4,5; Pascual Madoz, Madrid: Audiencia, Provincia, Intendencia, Vicaría, Partido y Villa (1848), pp. 434-468.
47. José Luis Cornelias Garcia-Llera, Los Moderados en el poder, 1844-1854 (1970), ch. 1.
48. Ibid., pp. 66-69; Fontana Lázaro, La quiebra, chs. 1 and 2; Charles Morazé, The Triumph of the Middle Classes (1968), ch. 5.
49. Comellas, Los Moderados, pp. 66-67; Domínguez Ortiz, Siglo XVII, pp. 209-210.
50. It can be argued that the disamortization lasted most of the nineteenth century, having begun in 1798, while discussion of the topic began long before. See Francisco Tomás y Valiente, El marco político de la desamortización en España (1971), passim; Vicens Vives, Manual, p. 585; Richard Herr, "Hacía el derrumbe del Antiguo Régimen: Crisis fiscal y desamortización bajo Carlos IV" (1970), pp. 45-50.
51. García Sanz, Desarrollo y crisis, pp. 376-388.
52. This is a conceptual approach easier to accept for Spain than for England--as presented by Peter Laslett in The World We Have Lost (1965), chs. 1, 2, and 9, in his discussion of change in English society.
53. See Robert Brenner, "The Origins of Capitalist Development," pp. 45-47. Richard Herr, "Spain," pp. 103-115; see also Miguel Artola, Antiguo Régimen y revolución liberal, pp. 115-118, 299-300.
55. José Luis Arangurén, Moral y sociedad: La moral social española en el siglo XIX, pp. 91-96.
56. Gabriel Tortella's study of mid-nineteenth-century Spain--Los origines del capitalismo en España: Banca, industria y ferrocarriles en el siglo XIX (1973), chs. 2, 3, 5, and 6--shows that as late as the 1850's and 1860's, Spanish capital was readily diverted to overinvestment in railroads, to the detriment of industrial production. Speculative aspects aside, the commercial possibilities inherent in breaking the transport bottleneck in the interior represented opportunities of a type more easily appreciated by the economic elite than did investment in industrial capacity.
57. Jordi Nadal Oller, in El fracaso de la revolución industrial en España, p. 27, shows that while in the 1790's 22% of government revenue came directly from customs duties, by the 1830's this had fallen to only 8% and as late as the 1850's was only 11 %. These figures ignore the secondary effects of commerce in augmenting ostensibly domestic revenue sources.
58. Josep Fontana Lázaro, in "Colapso y transformación del comercio exterior español entre 1792 y 1827" and La quiebra, pp. 49-50 and 210-218, effectively outlines the collapse of agriculture and commerce in the periphery, but refuses to admit any degree of commercialization oriented to Madrid that would have been insulated from the empire.