Paul Kennedy - The Rise and Fall of the Great Powers

Two further aspects of the Dutch economy enhanced its military power. The first was its overseas expansion. Although this commerce did not compare with the humbler but vaster bulk trade in European waters, it was another addition to the republic’s resources. ‘Between 1598 and 1605, on average twenty-five ships sailed to West Africa, twenty to Brazil, ten to the East Indies, and 150 to the Caribbean every year. Sovereign colonies were founded at Amboina in 1605 and Ternate in 1607; factories and trading posts were established around the Indian Ocean, near the mouth of the Amazon and (in 1609) in Japan.’ 85 Like England, the United Provinces were now benefiting from that slow shift in the economic balances from the Mediterranean to the Atlantic world which was one of the main secular trends of the period 1500–1700; and which, while working at first to the advantage of Portugal and Spain, was later galvanizing societies better prepared to extract the profits of global commerce. 86

The second feature was Amsterdam’s growing role as the centre of international finance, a natural corollary to the republic’s function as the shipper, exchanger, and commodity dealer of Europe. What its financiers and institutions offered (receiving deposits at interest, transferring monies, crediting and clearing bills of exchange, floating loans) was not different from practices already established in, say, Venice and Genoa; but, reflecting the United Provinces’ trading wealth, it was on a larger scale and conducted with a greater degree of certainty – the more so since the chief investors were a part of the government, and wished to see the principles of sound money, secure credit, and regular repayment of debt upheld. In consequence of all this, there was usually money available for government loans, which gave the Dutch Republic an inestimable advantage over its rivals; and since its credit rating was firm because it promptly repaid debts, it could borrow more cheaply than any other government – a major advantage in the seventeenth century and, indeed, at all times!

This ability to raise loans easily was the more important after the resumption of hostilities with Spain in 1621, for the cost of the armed forces rose steadily, from 13.4 million florins (1622) to 18.8 million florins (1640). These were large sums even for a rich population to bear, and the more particularly since Dutch overseas trade was being hurt by the war, either through direct losses or by the diversion of commerce into neutral hands. It was therefore politically easier to permit as large a part of the war as posible to be financed from public loans. Although this led to a massive increase in the official debt – the Province of Holland’s debt was 153 million florins in 1651 – the economic strength of the country and the care with which interest was repaid meant that the credit system was never in danger of collapse. 87 While this demonstrates that even wealthy states winced at the cost of military expenditures, it also confirmed that as long as success in war depended upon the length of one’s purse, the Dutch were always likely to outstay the others.

Let us now summarize the chief conclusions of this chapter. The post-1450 waging of war was intimately connected with ‘the birth of the nation-state’. 88 Between the late fifteenth and the late seventeenth centuries, most European countries witnessed a centralization of political and military authority, usually under the monarch (but in some places under the local prince or a mercantile oligarchy), accompanied by increased powers and methods of state taxation, and carried out by a much more elaborate bureaucratic machinery than had existed when kings were supposed to ‘live of their own’ and national armies were provided by a feudal levy.

There were various causes for this evolution of the European nation-state. Economic change had already undermined much of the old feudal order, and different social groups had to relate to each other through newer forms of contract and obligation. The Reformation, in dividing Christendom on the basis cuius regio, eius religio , that is, of the rulers’ religious preferences, merged civil and religious authority, and thus extended secularism on a national basis. The decline of Latin and the growing use of vernacular language by politicians, lawyers, bureaucrats, and poets accentuated this secular trend. Improved means of communication, the more widespread exchange of goods, the invention of printing, and the oceanic discoveries made man more aware not only of other peoples but also of differences in language, taste, cultural habits, and religion. In such circumstances, it was no wonder that many philosophers and other writers of the time held the nation-state to be the natural and best form of civic society, that its powers should be enhanced and its interests defended, and that its rulers and ruled needed – whatever the specific constitutional form they enjoyed – to work harmoniously for the common, national good. 89

But it was war, and the consequences of war, that provided a much more urgent and continuous pressure toward ‘nation-building’ than these philosophical considerations and slowly evolving social tendencies. Military power permitted many of Europe’s dynasties to keep above the great magnates of their land, and to secure political uniformity and authority (albeit often by concessions to the nobility). Military factors – or better, geostrategical factors – helped to shape the territorial boundaries of these new nation-states, while the frequent wars induced national consciousness, in a negative fashion at least, in that Englishmen learned to hate Spaniards, Swedes to hate Danes, Dutch rebels to hate their former Habsburg overlords. Above all, it was war – and especially the new techniques which favoured the growth of infantry armies and expensive fortifications and fleets – which impelled belligerent states to spend more money than ever before, and to seek out a corresponding amount in revenues. All remarks about the general rise in government spending, or about new organizations for revenue-collecting, or about the changing relationship between kings and estates in early-modern Europe, remain abstract until the central importance of military conflict is recalled. 90 In the last few years of Elizabeth’s England, or in Philip II’s Spain, as much as three-quarters of all government expenditures was devoted to war or to debt repayments for previous wars. Military and naval endeavours may not always have been the raison d’être of the new nation-states, but it certainly was their most expensive and pressing activity.

Yet it would be wrong to assume that the functions of raised revenues, supporting armies, equipping fleets, sending instructions, and directing military campaigns in the sixteenth and seventeenth centuries were carried out in the manner which characterized, say, the Normandy invasion of 1944. As the preceding analysis should have demonstrated, the military machines of early-modern Europe were cumbersome and inefficient. Raising and controlling an army in this period was a frighteningly difficult enterprise: ragtag troops, potentially disloyal mercenaries, inadequate supplies, transport problems, unstandardized weapons, were the despair of most commanders. Even when sufficient monies were allocated to military purposes, corruption and waste took their toll.

Armed forces were not, therefore, predictable and reliable instruments of state. Time and again, large bands of men drifted out of control because of supply shortages or, more serious, lack of pay. The Army of Flanders mutinied no less than forty-six times between 1572 and 1607; but so also, if less frequently, did equally formidable forces, like the Swedes in Germany or Cromwell’s New Model Army. It was Richelieu who sourly observed, in his Testament Politique: