A history of commerce

by Clive Day

307. Position of Venice at the beginning of the period.—Venice, which had enjoyed the commercial primacy among the Italian states, saw in the Portuguese discoveries a threat to her prosperity which only the strongest measures could avert. There was no physical reason why Venice should not adopt the sea route to India, and, if necessary, fight with the Portuguese for the Indian trade at its source. All her traditions, however, pointed the other way; all her investments were tied up in the route through Egypt; and, most important, all her resources were required in the Mediterranean. The island city had been drawn into an expansion on the mainland which involved her in continental intrigues and sapped her strength at sea, at the very time when her sea power was of the greatest importance; the navy of the Ottoman Turks was rapidly developing and the scourge of the Barbary pirates (from the Mediterranean coast of Africa) had begun.

308. Blows at Venetian trade both by sea and land routes to India.—For a moment Venice halted undecided between the two routes. Venetian ambassadors were especially instructed to procure maps, letters from voyagers, and all other information that would help the home government determine its policy with respect to the recent developments. Venice made repeated attempts to buy from Portugal the right to dispose of all the spices brought to Lisbon, a proposition that naturally was declined. Venice had to buy in small lots, on what terms the Portuguese chose to set; more and more silver flowed from Italy to Lisbon, and it became increasingly difficult to get spices in Venice. Meanwhile the government was sending explorers eastward, in the hope of opening one of the old routes to trade, and seriously considered for a time the piercing of the Suez isthmus with a canal. Venice found the Ottoman Turks favorable to trade through their dominions, but had not the strength to maintain her old commercial connections when Cairo was finally captured by the Turks in 1517.

309. Relative decline of Venetian commerce.—From this time the energies of Venice were absorbed in an unequal conflict with the Turks in the eastern Mediterranean. Venice had prepared herself in a measure for the Turkish advance, by removing her chief staple from Alexandria to the island of Cyprus, but this too was lost in 1571 after a heroic defense. The battle of Lepanto and others following it were empty victories; on the east coast of the Mediterranean Venice had to surrender, and consent to trade on the terms which the Turks imposed. Trade was still maintained. Aleppo became in the later period a market in which the Venetians had great establishments, drawing thence the wares that came by caravan from Bagdad, Persia, and India. Venice herself became constantly more beautiful, and was in the seventeenth century, as now, one of the show-places of Europe, where foreign visitors flocked by thousands. Her manufactures of glass and silk and many artistic luxuries remained unexcelled. It is, however, by quantity and not quality that we measure the greatness of a state’s commerce; Venetian trade scarcely entitled the city to a place even in the second rank of commercial states, when it finally lost its independence in 1797.

310. Decline of commerce and industry in Tuscany.—The history of decline in other parts of Italy must be dismissed more briefly. Florence, which at the beginning of this period ranked next to Venice in manufactures, trade, and banking, found the markets of northern Europe closed by the Dutch revolution, by the religious wars and by the tariff barriers of the protective policy. Bankruptcy became frequent in the latter part of the sixteenth century. The woolen manufactures of Florence, which, it is said, employed 30,000 men in 1338, employed 971 in 1767. Hampered not only by weakness abroad but also by restrictive legislation at home, the Tuscan people declined to poverty and indolence. Prosperity was to be found in only one spot, the city of Leghorn, which had been made a free port; but this city prospered just because it had been placed on the outside of Tuscany, and the riches amassed there went largely into the hands of foreign residents.

311. Decline in other parts of Italy.—South of Tuscany conditions grew still worse. The Roman territory had never been of commercial importance, and the Neapolitan territory lost in this period what prosperity it had once had. Under a Spanish government, which was almost incredibly bad, the national resources were wasted abroad while Turks ravaged the coast, kidnapping slaves, at home; and the producing classes were crushed by heavy and unfair taxes.

North of Tuscany conditions were little better. The report of a commercial agent who was sent by the Austrian state to investigate upper Italy in 1754 shows commercial weakness everywhere. The country was divided by tariff barriers into a great number of distinct territories, of which scarcely any were large enough to give play for the development of industries which they were endeavoring to protect. The forces of industry and commerce were scattered and lost among a great number of small towns, and trade was largely controlled by foreigners, both Jewish and Christian.

312. Conditions in the Scandinavian countries.—It would be unprofitable to attempt here to trace the course of commerce in all the other states of Europe during this period, and this part of the book will close with a brief description of commercial conditions in the North and East. The districts included in Scandinavia are already familiar to the reader as forming an important field for the Hanseatic trade in the Middle Ages. The population was sparse, industry was undeveloped, towns were few and small; the knowledge and capital necessary for an active independent trade were lacking, and people were content to stay at home and let foreign merchants come to them with manufactures and take away their surplus products. The iron industry of Sweden, favored by rich ores, extensive forests for fuel and abundant water power, attained considerable importance; but the exports continued in general to be raw materials, especially those used in food and for ship building. Governments attempted to hurry the development of their peoples by protective duties and by the founding of commercial companies, with slight success. Gustavus Adolphus, a king of Sweden in the seventeenth century, formed the bold project of making the Baltic “a Swedish lake,” by control of the entrance and the coasts, but his successors proved unable to maintain the position which he won. The keys of the Baltic fell into the hands of Denmark, and that country made a good profit by collecting tolls on the flow of a trade to which it contributed little itself.

313. Rise of Russia to a position among the European states about 1700.—Russia was even more backward than the Scandinavian states. Like them it had been dependent on the Hanseatic merchants for its commerce with western Europe, and remained passive after their fall, accepting what wares reached it overland or through the port of Archangel on the Arctic coast, whither English and Dutch shippers ventured. Until Peter the Great opened his “window on the West,” by the founding of St. Petersburg on the Baltic about 1700, Russia was hardly a European state. Peter attempted, with remarkable energy, to bring Russia to the European standard in commerce and industry as well as in politics. He reformed, though he did not abolish, the system which gave the Czar a monopoly of trade in the most important wares; he revised the tolls on trade; he sent young men abroad to study commerce, and tried in other ways to elevate the merchant class. Peter did not succeed in his attempt to free Russian commerce from its dependence on western merchants, and his attempt to build up a merchant marine was a failure. In the East, Russian commerce fared better. Occasional caravans had gone before this from Siberia to China. The Czar now sent on his own account caravans which consumed three years on the long trip from Peking to Moscow; and individuals developed the trade which the crown had stimulated.

314. Character of Russian commerce in the eighteenth century.—Russia could be regarded in the eighteenth century as a European state. It belonged, however, to the Europe of the Middle Ages rather than of the modern period. Most of the population, including even the few who were occupied with manufacturing, were serfs. The people as a whole were on a low standard of living, and were densely ignorant. Commercial law was undeveloped, and trading practices were those of a half civilized community. The government interfered with exchange by arbitrary and vexatious restrictions. The country could export, with rare exceptions, only raw products. From China it imported tea, silk, gold, jewels, etc., of which only a part was kept at home; while it was dependent on western Europe for most of its colonial wares (sugar, coffee, spices, and drugs), and for all the finer manufactures (textile, metal, pottery, paper, etc.).