Resources of the Netherlands and of Spain

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in event of civil war or foreign attack, was not overlooked by Charles and his advisers, but its full significance was not in fact disclosed until the reign of Philip II. On the question of right Charles professed to be fighting for a vassal of the Empire wrongfully deforced; then for an imperial fief forfeited by Sforza's treason; and the restitution of Milan to Sforza shows that the plea of right was not wholly insincere.

We can see that the whole issue of the struggle centred in the question of finance, but unfortunately we are unable to follow the details or draw up any budget of expenses or receipts either for France or the Spanish possessions. During the years from the election to the Empire until the Conference of Bologna, the Netherlands were the chief resource of Charles. Year after year the Estates voted unheardof subsidies; the total contributions of the Low Countries are estimated for 1520-30 at no less than 15,000,000 livres tournois; and though a considerable part of this was consumed in the defence of the provinces, for the necessities of their government, and the maintenance of the Court of the Regent, it was to the Netherlands that Charles looked in the moments of his greatest despair. Castile came next, so soon as the revolt of the Comuneros had been crushed. The annual income of Spain may be estimated at about 1,500,000 ducats, in the first years of Charles' reign. The Empire and the hereditary Habsburg lands may for this purpose be neglected.

Money was raised in Castile by pledging the taxes in advance, by issuing juros or bonds at fixed interest charged upon the national revenues, by mortgaging to financial houses every possible source of profit. In this way the great House of Fugger took over in 1524 the estates (maestrazgos) belonging to the masterships of the three military orders, and later the quicksilver mines of Almaden, and the silver mines of Guadalcanal. The cruzada, or revenue from indulgences granted on pretext of a fictitious crusade, became a regular source of revenue, and when, as in the time of Clement, the papal sanction was refused, the King did not scruple to raise it on his own authority, and to pledge it for many years in advance. The fifth on all treasures imported from the Indies was since the conquest of Mexico becoming a valuable supplement, and as an exceptional measure the treasure could be seized and juros issued in recompense. But the objection of the Spaniards to the export of treasure from the peninsula made the use of these resources at a distance a very difficult operation, which could only be negotiated. by the aid of the most powerful financial houses. From his early years Charles relied greatly on the Fuggers; Genoa from the first, except when it was in French hands, and in the later years of his reign Antwerp, were mainstays of his financial power. Charles was very punctilious in defraying at least the interest if not the capital of his debts, and thus he was at all times able to borrow upon terms. His juros were sometimes issued at a price equivalent to a rate of 7 per cent.: but in times of great

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Italian resources.—Revenues of Francis

need and danger, when time was the dominant factor, he was obliged to pay as much as 12 and even 16 per cent. for loans. As time went on the revenues of the Netherlands were similarly pledged in advance.

The revenues of the Duchy of Milan in time of peace might have been considerable. In time of war they were whatever the army could raise from the impoverished inhabitants; and before the war was over the state of the country was such that not only was there no superfluous wealth, but the army and the inhabitants alike seemed in a fair way to perish of starvation. The case of Naples and of Sicily was not quite so desperate, in spite of two rather serious risings in Sicily which we have not had occasion to mention. But here a considerable army of occupation had to be kept up and a fleet, if possible, for the protection of the coast, if not from the French and the Genoese, at any rate from the pirates of Algiers. The surplus revenues of the southern kingdoms cannot have been large, and although very often in an emergency Lannoy produced money to content some starving troops or to move some paralysed army, the sums which are mentioned are almost always small, and give but a poor idea of the capacity of the kingdoms to assist their King. Here also the same ruinous policy was pursued as in Castile, of pledging everything in advance, of selling everything that could be sold; and years of peace would be required before the kingdoms could recover. In Italy another valuable source of occasional revenue was the subsidies raised from the lesser Italian States, which, unless actually at war with the Emperor, could generally be coerced into payment, and, if in his alliance, were expected to contribute handsomely. The Pope was the largest giver, but Venice could sometimes be bled, and Florence, Lucca, Siena, Ferrara, Mantua, were often in a condition which made refusal difficult.

The King of France had a better financial system and was not troubled like the Spanish King by the necessity of consulting his Estates. His entire revenue was somewhat less than the joint revenues of Spain and the Netherlands, but on the other hand he could increase it more rapidly by raising the taille, and it was entirely at his disposal; nor was he troubled like Charles by the necessity of difficult financial operations before he could fit out an army. On the other hand, when his army was abroad these obstacles confronted him also. His financial ministers were not conspicuous for honesty, and the institution of the Trésor de l'Épargne in 1523, to receive all casual and unexpected sums of revenue and to build up a reserve fund to be at the King's absolute disposal, was not so great a success as was hoped. The deficits during the years of war reached an alarming figure, and it is difficult to see how they were met. For the credit system in France was not developed as it was in Augsburg, Genoa, and Antwerp. The first public loans in France were raised on the security of the revenues of particular towns; and it was not until 1542 that the King began to build up Lyons as a

financial centre to perform for him the same functions that the bourses of Genoa and Antwerp were fulfilling for Charles. The attempt had some success, and similar bourses were started at Toulouse (1556) and at Rouen (1563). Henry II on his accession acknowledged the debts of his father, and the royal credit sensibly improved. At the outset the King was obliged to pay 16 per cent. for advances, but by 1550 the rate had fallen to 12 per cent. But confidence was rudely shaken when in 1557 the King suspended the payment of interest on the debt, which at that time amounted perhaps to five million crowns.

We can thus get a glimpse of the methods by which the enormous expenses of these and subsequent wars were liquidated. All the spare cash of Europe, withdrawn from commerce and industry, flowed at a crisis into the King's coffers; the road was opened to national bankruptcy, which was general soon after the treaty of Cateau-Cambrésis. Princes had learnt to borrow, but they had not learnt to pay. The sources of wealth were diverted from profitable and useful enterprise to destructive war; and in the long run not even the financiers profited, though in the interval some capitalists built up fortunes, which are almost comparable with those of our own day.

5

C. M. H. II.

CHAPTER III

HABSBURG AND VALOIS (II)

AFTER the Treaty of Cambray and the Conference of Bologna the interest of European history shifts its centre to Germany. Charles' efforts in the South were chiefly devoted to the preservation of the existing equilibrium in Italy, to resisting the continuous advance of Muslim power in the Mediterranean, and to the restoration of some degree of prosperity to the shattered homes of Italy. His main attention was centred on the religious question in Germany, and the maintenance of Habsburg power on the Danube. France was still a chronic menace, but the wars were neither so frequent nor so dangerous as they had been from 1522-9. The death of Margaret of Savoy (December 1, 1530) who had governed the Netherlands during Charles' minority (1507-15), and again with intervals from 1517 until her death, made another break with the past. Margaret had been the confidante and intimate adviser of her father Maximilian and, although for a time after his accession in the Netherlands Charles had been estranged from her, he soon discovered her worth, and relied on her as on another self. She was perhaps the most capable woman of her time, well versed in all the arts of politics and diplomacy, a friend of letters and of art, and under her rule the authority of her nephew over the Burgundian States had sensibly increased, though the prosperity of the provinces had not shown a corresponding advance. He was fortunate in finding in the circle of his own family another woman, perhaps less gifted, but well competent to take her place and carry on her policy. His sister Maria, the widow of the unfortunate King of Hungary who fell at Mohacz, was persuaded to undertake the task, for which she had shown her capacity in the troubles which followed the death of her husband Louis, and she entered upon the duties of her office in 1531. Her government was strengthened by the new ordinance establishing three Councils in the Netherlands for foreign affairs, justice, and finance. Shortly before Charles had procured the election of his brother, the Archduke Ferdinand, to the dignity of King of the Romans, and he could therefore regard the relations of his House to Germany and the Netherlands as satisfactorily established.

1531–3]

Anxieties of Charles in Europe

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But his other European concerns gave him grave cause for anxiety. Henry VIII had been brought into marked hostility with Charles by the affair of the divorce. Francis was ever on the look-out for opportunities of reversing the decisions of Cambray. Clement was perplexed by the demand for a General Council; irritated by the appointment of the Cardinal of Colonna, his enemy, as Governor of Naples; and aggrieved by the award of Reggio and Modena to the Duke of Ferrara (April 21, 1531). Charles' earnest desire for joint action against the Turks was thwarted by the scarcely concealed hostility of Francis, and the more secret manœuvring of the Pope. On June 9, 1531, Clement concluded an agreement for the marriage of Catharine de' Medici to Henry, Duke of Orleans, second son of Francis, with secret articles binding the Pope to assist France in the recovery of Milan and Genoa. The German antagonists of Ferdinand were allied with Francis. The formation of the

League of Schmalkalden and the renewed advance of Solyman upon Vienna (July, 1532) added further complications, and Charles was in consequence obliged to temporise with the Protestant Powers of Germany (August, 1532). Aid was sent to Ferdinand not only from Germany but from Italy, which for once enabled Ferdinand to meet the enemy in force; Solyman retired and Charles had a respite.

In the autumn of 1532 Charles was again able to visit Italy. Here he found all the States wavering. Venice watched the situation with a cautious eye, well informed of all that was moving in every Court, and ready to take any advantage that offered. Milan groaned under the foreign occupation. Mantua and Ferrara were of doubtful fidelity. In Florence, where the old constitution had been abolished in 1532 in favour of an unmasked autocracy, and in Genoa, where the party of Spinola and Fiesco still were strong, there were powerful political forces working for change. Armed intervention had been necessary at Siena. After a long visit to Mantua, where the famous meeting with Titian took place, Charles met the Pope once more at Bologna (December, 1532). Clement managed to avoid the General Council by imposing impossible conditions; and Charles failed to induce him to give up the projected marriage of Catharine with the Duke of Orleans. All that he could secure was the renewal of a defensive League in which Clement, Milan, Ferrara, Mantua, Genoa, Lucca, Siena, were all included. Venice alone refused to join even this deceptive League. On April 9 Charles left Italy for Spain, where his presence had long been eagerly desired.

The marriage of Henry with Anne Boleyn, which was solemnised on May 23, 1533, now threatened a change in the political situation. But Henry was in close alliance with Francis; and Charles was obliged to accept the insult. And although on July 11 the Pope launched. against Henry the Bull of Excommunication, which was not however to come into force until October, he was at the same time arranging for a meeting with Francis, and preparing to hand over in person his