The fall of Spain, the first global superpower, and the fall of the US

http://www.americaneconomicalert.org/view_art.asp?Prod_ID=1086 ^

[GeorgeSaden]

It may be hard for most people to imagine, but Spain was the first global Superpower. It gained this status as the defender of Europe against Muslim armies and by leading the West’s exploration of America. In 1492, the same year that Spanish-financed Christopher Columbus discovered the New World, the last Muslim stronghold of Granada was ceded to Ferdinand and Isabella to complete the Catholic Reconquest of the Iberian peninsula... It controlled rich parts of Italy through Naples and Milan, and Central Europe from the Netherlands through the Holy Roman Empire to Austria. In the 16th century it added the far distant Philippine islands to its empire. The Hapsburgs held off the Ottoman Turks, whose resurgent wave of Islamic conquest in the 16th century swept across the Balkans and nearly captured Vienna.

[snip]

Yet, Spanish leaders were deluded by a sense of false prosperity. This is testified by the statement of a prominent official, Alfonso Nunez de Castro in 1675: “Let London manufacture those fine fabrics of hers to her heart's content; let Holland her chambrays; Florence her cloth; the Indies their beaver and vicuna; Milan her brocade, Italy and Flanders their linens...so long as our capital can enjoy them; the only thing it proves is that all nations train their journeymen for Madrid, and that Madrid is the queen of Parliaments, for all the world serves her and she serves nobody.” A few years later, the Madrid government was bankrupt. The Spanish nobleman had foolishly elevated consumption, a use for wealth, above production, the creation of wealth.

[Woebama]

This is testified by the statement of a prominent official, Alfonso Nunez de Castro in 1675: “Let London manufacture those fine fabrics of hers to her heart’s content; let Holland her chambrays; Florence her cloth; the Indies their beaver and vicuna; Milan her brocade, Italy and Flanders their linens...so long as our capital can enjoy them; the only thing it proves is that all nations train their journeymen for Madrid, and that Madrid is the queen of Parliaments, for all the world serves her and she serves nobody.”
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Frighteningly similar to the free trade “who cares” attitude towards foreign manufacturing.

Wow.

[WashingtonSource]

bump

[2banana]

The irony of this is that Spain was ruled by a warrior aristocracy tempered by centuries of constant warfare against Islamic hordes and Christian heretics. These nobles looked down on merchants and manufacturers and disparaged their mundane professions only to find that without a strong domestic business class they could not afford the fleets and armies that guarded the empire they had built.

By the time of the Spanish-American war - the Spanish Army and Navy were a joke.

[Woebama]

The U.S. trade deficit is nearing Spain’s nadir of imports being double exports.

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Another striking comment in this. Thanks for posting.

[Little Ray]

I have been listening to Empires of the Sea. I thought some of Spain’s issues sounded familiar.

At least we still pay our soldiers on time...

[pgkdan]

Today, the American “empire” is also trying to consume more than it produces. The U.S. trade deficit is nearing Spain’s nadir of imports being double exports. Both government spending and private consumption are financed heavily by debt. Washington is printing money, the modern equivalent of digging gold out of the ground, rather than earning the means to pay its bills. And the political and military elites are apparently indifferent to the fate of domestic business and industry. Americans must learn more from the Spanish experience than just the perils of appeasing terrorists—and take corrective action while they still can.

Too bad we didn't learn in time...

[mjp]

but it could not produce the goods it needed at home, which in the long-run proved fatal to its standing as a Great Power and as an advanced society.

Like the Romans before them,the Spanish made conquest and plunder - not industry, production, trade, and commerce - their economic goal

[agere_contra]

Frighteningly similar to the free trade “who cares” attitude towards foreign manufacturing.

That's your take-home message from this?

America is in trouble because it can't compete. Its industry is weighed down with taxation, over-regulation, unionization and an increasingly poorly educated or tax-demotivated workforce.

Forcing Americans to buy their stuff from feather-bedded internal suppliers would solve these problems how?

The only reason you guys have any standard of living at all is because other people make stuff well and cheaply.

Don't like it? Try reducing your internal barriers to wealth-production. Don't whine about the competition.

[pepsi_junkie]

Rome lasted 1,000 years. Spain’s time at the top was less than 200 years. Rome did have a thriving merchant class, as the US does today (a.k.a. the middle class). Spain never did. They remained feudal with two classes, the really really rich, and the really really poor. As this article points out, they shunned industrial development.
Their economy was smoke and mirrors, propped up by an inflow of gold and silver from somewhere else. The US has a bit more going on than that.

[wolfman23601]

Isabella was a Hapsburg herself so it could be argued just as easily that the Germans held that empire (it later fell into the hands of Charles V who was king of a lot of places and Holy Roam Emperor).

That said, there are striking similarities in the governing of Obama and Philip II of Spain, who squandered any power Spain had left in the Elizabethian Age.

[egannacht]

Not a fan of Spain or the Hapsburg empire due to their involvement in removing the templars, inquisitions against so-called heretics, jews, and moors. The dictatorship that destroyed Catalonia, Grenada, and Navarre introduced intolerance and a form of centralized economy into relatively free lands and free economies. Ancient Catalonia of Spain and France was the envy of Europe. Spain killed tolerance, killed freedom, killed free markets, and killed the brain trust that existed.

As far as I’m concerned, Spain is a glaring example of how not to form a government, a tolerant society of freedom, or a highly evolved capitalist economy that the framers of the US Constitution took note, and avoided installing. You’ll notice any lands controlled by Spain have had trouble with allowing freedom and their economies are systemically deeply troubled.

[piytar]

Bang! That comment hit the 10 ring! Well said!

[Woebama]

You are British from the flag on your profile. Your nation was an economic leader as well once under a regime of promoting internal trade and discouraging imports from outside of the empire. In the USA it is sometimes refered to as a Hamiltonian trade policy. I’m afraid you’ve lost sight of the reality around you — when the US and the UK were successful they were more protectionist.

[jpsb]

"Like the Romans before them,the Spanish made conquest and plunder - not industry, production, trade, and commerce"

Lol, Rome had industry, production, trade and commerce in spades and the Roman Republic/Empire lasted almost 2,000 years 400 B.C.-1400 A.D. Or a 1,000 years if you just count the Western Empire.

[rae4palin]

Everything old is new again. Thanks for the post.

[achilles2000]

It’s nice that someone occasionally reminds the protectionists here what the real problems are. I would add that the reduction of our productive capacity has been a goal long pursued by the left.

[TimSkalaBim]

"when the US and the UK were successful they were more protectionist."

Ah, yes, the Roaring Thirties.

[Woebama]

1792 on . . . we didn’t used to have any Federal taxes other than tarriffs and we were a lot more successful economically relative to the rest of the world than we are now. You can be flippant about it but we are seeing the end of an era now. This article points out that we are approaching the 2 to 1 mark, imports to exports.

[TimSkalaBim]

Actually, the 19th century was a free-market century, more so than the 20th, which has to be considered the big government century.