The Hapsburgs

In the 1500s, much of Europe was ruled by the Hapsburg family. The Hapsburg Empire was like the medieval version of a corporation: it was composed of smaller states which had united to form one larger empire. These semi-independent states received military protection from the Hapsburg empire as a whole, and in exchange the states paid taxes back to the ruler. The Empire was expanded by marrying into other ruling families, and this was how the Hapsburgs came to rule Spain .

Philip the Fair, a Hapsburg, married the daughter of the King of Spain (That's Ferdinand and Isabella of Christopher Columbus fame). Since their son, Charles V was half Hapsburg and the new ruler, the Hapsburgs now effectively had control over Spain . Charles came to inherit a huge empire.

Philips's inheritance

In 1556, Philip inherited a unified Catholic empire from his father Charles V. This empire was completely untouched by Protestantism (despite the Reformation), and Charles had also been marginally successful in holding back the Ottoman Turks, buying some time for Philip. However, Philip also inherited a massive amount of debt, somewhere in the area of 40 million ducats, or four years income.

So now Philip faced several problems

•  An aggressive Ottoman Empire attacking the German Hapsburgs from the East

•  Protestant uprisings in Germany

•  Spain had expanded too quickly; Philip needed to create a larger army, and at the same time spare enough funds to pay off debt

For the thirty year span from 1556 to 1586, Philip was somewhat successful in holding the empire together. Even with silver flooding in from South America, the trade generated by this silver still could not stop Spain from hemorrhaging money. Even while he was losing money at an alarming rate, Philip assembled a navy large enough to decisively defeat the Turks at the Battle of Lepanto

However, Spain's influence throughout Europe was only temporary; Philip's reckless financial policies would soon get the better of him.

(1588-1598)

Philip II's reign between 1588 and 1598 AD is often referred to as the Decade of Crisis; this marks the point where political and financial turmoil began to suck the life out of the Spanish Hapsburgs. There were five major factors in Spain 's fall from world power.

1. Rebellion in the Netherlands

  During Philip's reign, the Dutch were in a state of constant rebellion (funded by the Brits). This turmoil was caused by two things: religious strife between Catholicism and Calvinism (new to the area), and the unhappiness resulting from a 400% tax increase by Philip. In 1586, these rebellions grew into a full blown revolution, and Holland eventually became a separate country.

2. The Defeat of the Spanish Armada

  In 1588, the British fleet's small, fast ships defeated the Armada (A giant naval fleet)'s slow lumbering behemoths. While very few Spanish ships were destroyed in the actual battle, almost all of the Armada's 150 or so ships were then destroyed in a storm in the English Channel . Building the Armada set Spain back 10 million ducats, or a year's income, and this money was completely wasted.

3. New Fighting Between France and Spain

  France and Spain had not gone to war since Charles' time, yet the new French king was a Protestant, and saw Spain 's weakness as a chance to gain territory and wealth. Spain , while losing little territory, lost even more money and soldiers protecting itself.

4. Continued Protestant uprisings

  The reformation was still going strong in Phillip's time, and the Spanish Hapsburgs were forced to divert further funds and money to aid their German “corporation” brothers in keeping down the Protestants.

5. Holding off the Turks

  The German Hapsburgs were also pressured from the East by the Turks, who had sprung back stronger than ever after the Battle of Lepanto. Spain 's military was diverted even more by sending troops to fight the Turks. Marching hundreds of thousands of men across Europe was enormously expensive as well;. Philip had to feed and supply all of these men. (Thankfully, the Spanish army was composed mostly of professional soldiers, so Philip didn't have to train them)

The Sum of these Troubles

(The state of Philip's world)

The cumulative effect of these five events dealt Spain a permanent deathblow. It cost Philip 60 million ducats to try (and fail) and keep the Netherlands alone. (Like I said earlier, the income from silver and taxes only gave them 10 million ducats a year). Spain 's fragile economy simply could not meet the demands placed on it by an empire of this size. Philip II went insane in 1595, and later died in 1598, leaving Spain at a fraction of its former strength. By the time of the thirty years war, Spain was considered a minor player and was completely ignored by the rising European powers, England , Holland and France .

Why do we Care?

Our unit, Global Contact, focuses on the period from about 1500 – 1700 (AD) where trade was sparked between different civilizations from all over the world. Seeing all of the wealth created by independent nations like China and England , it's easy to mistake the Spanish Hapsburgs for a bankrupt, backwards European monarchy. However, the Hapsburgs were an important part of the trading that arose from Global contact. The Hapsburgs also acted as the foundation for many influential trading nations later in our period. Both the Portuguese and the Dutch, who had major empires, were originally Hapsburg states. The world supply of silver doubled thanks to Spanish mining in South America . Without the Hapsburgs, Europe would have been decades, or even centuries slower to establish trade with the rest of the world, and would not have been nearly as wealthy.

Bibliography

(Trueman, C). "Philip II of Spain"

www.historylearningsite.co.uk/Phillip.htm