While determined to advance the general interests of his subjects, he was always ready to conclude commercial treaties conferring a mutual exchange of benefits; and he sought, wherever possible, to draw mercantile advantages from his handling of purely political matters. The commercial relations of England and the Netherlands form an illustration in point. In 1493 there was a serious quarrel on account of the support given to Perkin Warbeck by Margaret, the widowed Duchess of Burgundy and sister of Richard III. Henry’s retaliation to her vindictive encouragement of his enemies consisted in ordering the cessation of all intercourse, and the removal of the Continental head-quarters of the Merchant Adventurers from Antwerp to Calais. Uninterrupted trade with England was essential to the prosperity of the Netherlands, where a large proportion of the craftsmen were employed in dyeing and finishing the rough English cloth. There was on both sides great distress in commercial circles, and unemployment due to the loss of trade; but the inconvenience thus caused, while considerable in England, was intolerable in the Netherlands, and the result was the negotiation of the famous Magnus Intercursus of 1496, followed by supplementary treaties in 1497 and 1499.[[3]] By these treaties tariffs were reduced, fishing rights regulated, and many vexatious restrictions abolished; in addition, Henry secured the political object for which he had undertaken the struggle. When the English cloth merchants returned to Antwerp they were received with public demonstrations of joy.
The English king, although willing to make concessions when such were inevitable, showed himself remorseless in seizing an accidental advantage. In January 1506 the Archduke Philip, who had succeeded to the throne of Castile on the death of Queen Isabella in 1504, set out from Flanders to Spain by sea. In the Channel he encountered a furious storm, and, after all on board had given themselves up for lost, his fleet reached the shelter of Weymouth. Contrary to the advice of his captains, he went on shore. The country people, seeing the arrival of strange ships and armed men, gathered to resist an enemy, but, finding him to be a friend, they made him welcome. Sir Thomas Trenchard, a most astute gentleman of the neighbourhood, offered him entertainment, and sent off post haste to acquaint King Henry of the prize which fortune had cast on his shore. Philip now realized his rashness and would have been glad to depart, but was earnestly entreated by Trenchard and his friends to stay and speak with the king. Fearing that if he insisted their courtesy would give place to force, he put a good face on the matter and professed himself delighted to remain. Henry sent the Earl of Arundel, with many lords and knights, to bring him to Windsor with his wife Juana.
He was paraded through London and, as the price of his liberty, had to agree to a commercial treaty which settled outstanding questions in such a one-sided way, and admitted English cloth at such a cheap rate to the Netherlands, that the defrauded Flemings named it the Malus Intercursus.[[4]] In those times shipwrecked voyagers received scant compassion, and Henry was only taking the same advantage on a large scale as his unscrupulous subjects took on a smaller one when they stole the cargoes from stranded ships. Philip died without ratifying the treaty of 1506, the details of which were not completed until after he left the country, and relations became unsatisfactory in consequence. Margaret proposed to resume trade on the terms of the Magnus Intercursus, but Henry was unwilling to forgo his hard bargain. Finally, a compromise between the treaties of 1496 and 1506 was agreed upon, the customs payable by Englishmen in the Netherlands remaining on the basis of the latter. The question of the legal validity of the Malus Intercursus remained unsettled, the matter being postponed from time to time by the issue of provisional ordinances for its maintenance. As late as 1538 the Netherlanders were still demanding its abrogation.[[5]]
An important trade existed between England and Spain and, at the beginning of Henry’s reign, it was largely in the hands of Spanish merchants, a number of whom resided in London. The customs duties had long been in an unsettled state, and were the subject of an arrangement included in the Treaty of Medina del Campo, 1489.[[6]] It was provided that the subjects of either country might travel, reside, and carry on business in the other without a passport, and should be treated in every way as native citizens. Customs duties were to be reduced and all letters of marque (i. e. private reprisal for injuries) revoked. There were also other clauses intended for the suppression of piracy, a subject which will be referred to later.
That such treaties were often broken is proved by their frequent renewal; and indeed, the signing of a treaty was more often the signal for a commencement of wranglings as to its interpretation, than a token of settlement. In the case in point it had been agreed that customs were to be reduced to what they had been thirty years before. The intention was plain, but Henry discovered that the English duties had been higher at the date mentioned than at the time of the treaty, and he promptly increased them, although the Spaniards protested that they had lowered theirs. The dispute on this point dragged on for many years, and references to it occur at intervals in diplomatic correspondence until the marriage of the Prince of Wales and Katherine of Aragon. A curious fiscal argument occurs in a letter from Henry to the Spanish sovereigns in 1497.[[7]] He says that the effect of the high duties is that Spaniards sell their goods at a high price in England, and so are enabled to obtain more English cloth with the proceeds than they could otherwise do. Thus the duties are paid by the English, not the Spaniards. An excellent sermon—for other people—on the disadvantages of protection!
Although anxious to foster English trade and enterprise to the utmost, Henry could not afford to neglect his dynastic interests, and the latter were of paramount importance in his dealings with Spain. His title was weak and his enemies strong, and, during the first part of his reign, it seemed quite likely that he would perish in a feudal revolution as four of his predecessors had done in the space of a century. To remedy the instability of his throne he was sometimes obliged to make use of commerce as a weapon or a bribe, as opportunity offered. An instance of the first was seen in his dealings with the Netherlands; the negotiations for the Spanish marriage were an example of the second. The proposals and hagglings with reference to this marriage dragged on for years. Henry was eager for it. He was, in a sense, a parvenu among the kings of Europe, and he felt that it was a vital matter for him to establish his family among them. Ferdinand and Isabella, on the other hand, had great hesitation in allowing their young daughter to be exiled among the English, whom the Spaniards regarded as being socially and morally inferior to themselves. In addition to this personal objection they had another. They wished to procrastinate until Henry should have disposed of his pretenders and given proofs of the firmness of his throne. Hence his extreme eagerness to lay Perkin Warbeck by the heels, which embroiled him with the Netherlands in 1493. The marriage being the keystone of his policy, he left no means unused to bring it about, and so we find commercial relations employed by him as a screw with which to extort the reluctant acquiescence of Spain. In 1496 he declared that he would come to an understanding on the question of the duties after the alliance and marriage should have been concluded. In 1497, in the letter already quoted, he promised that Spanish traders should have preferential treatment as against the Italians in celebration of the happy arrival of the princess in England, an event which was still to be delayed, as it proved, for more than four years to come. One more instance of the intimate connexion of politics and trade may be given. In 1504 the Spanish Government prohibited the export of goods from Spain in foreign vessels so long as there were any Spanish ships unemployed, but in consideration of the position of the now widowed Katherine in England and of their desire to recover her or her dowry, the English were exempted from the application of this law.[[8]]
With Venice Henry VII was never on bad terms, although for several years a brisk tariff war was waged between the two powers. It arose from the action of Venice in imposing an additional export duty of four ducats per butt on malmsey wines loaded by aliens at Candia. This was done under pretext of discouraging the pirates of that region, but in reality for the purpose of favouring Venetian shipping. Henry retaliated by making Venetians pay 18s. per butt extra duty on importing these wines into England, and by fixing a maximum selling price of £4 per butt. A butt of malmsey contained 126 gallons, and a gallon of the wine thus cost about 7½d. in England. The differential duty and the maximum selling price threatened to squeeze the Venetians out of the market, but the king went further. He entered into negotiations with the Florentine Government with a view to the establishment of an English wool-staple at Pisa.[[9]] This would have constituted the latter city the distributing centre for English wool in the Mediterranean, and Venice would have been deprived at a blow of an important branch of her trade. The proposal seriously alarmed the Venetians, and they threatened to discontinue the dispatch of the annual trading fleet to England. It would have been manifestly impossible for them to bring cargoes of spice to England if they were debarred from loading wool in return, especially as the export of specie from England was prohibited. The Pisa project was probably not seriously intended and was not persisted in, although the appointment in 1494 of two English consuls in that city, with full authority over English merchants, indicates that considerable business was done there.[[10]] In the end, after lengthy but quite dispassionate negotiations, such as befitted business-like powers, Henry carried his point and the wine duties were reduced.[[11]]
The prohibition of the export of money, and also of gold and silver plate, from the realm was typical of the economic ideas of the time. Gold was looked upon as wealth in itself rather than as a means of exchange, and this notion was strengthened as time went on by the enormous apparent advantages which Spain derived from her American conquests. It was an error which led Spain to ruin, and would have been equally fatal to England if she had had the same opportunity to go astray. Fortunately, Englishmen found themselves excluded from the gold-bearing regions, and were driven to trade and eventually to colonization instead.
To be successful as a merchant under the conditions which obtained in the days when individual effort was beginning to displace the rigid guild-system of the Middle Ages, a man had need of alert wits, a stout heart, and capital sufficient to enable him to withstand the violent fluctuations of fortune. Even in times of peace the risks were great, although undoubtedly the profits of the successful were proportionate. Shipwrecks were necessarily frequent on unlighted and practically uncharted coasts; the trade routes were infested with pirates and privateers; and commercial treaties were broken almost as soon as made. The cautious trader, before venturing his goods into a foreign country, was careful to procure a licence or safe-conduct from the Government, and even this did not always protect him. If he could obtain the patronage of a powerful person, he might contrive to avoid the payment of customs dues. In 1492, when Henry VII imposed the prohibitive duties on Candia wines, the Venetian merchants in London were advised to distribute forty or fifty butts of the wine, or their cash equivalent, as bribes in getting the matter set right. Even State-owned vessels were not secure from molestation, when sufficiently far from home. In the same year, 1492, we read that Henry, being at war with France, detained the Flanders galleys of Venice to act as transports for his troops.[[12]] A powerful Government might secure compensation for such an infringement of its neutrality, but private merchants would have stood little chance of doing so. Conditions such as these caused success to depend entirely on individual qualities; and when once they took to the sea Englishmen were not slow to develop that character for resource and audacity which stood them in such good stead in the long war with Spain at the end of the sixteenth century.
An incident which occurred in 1505 shows how little reliance could be placed upon treaties by the persons whom they were designed to benefit. On the strength of an undertaking by the Spaniards, already mentioned, that notwithstanding the navigation law the English might freely export goods from Spain, a fleet of English merchantmen went to Seville, with cargoes of cloth, intending to come back with wine and oil. On arriving there, they were forbidden by the local authorities to export anything, and returned professing themselves ruined. Their spokesmen petitioned the king, ‘with much clamour’, for redress. Henry sent for de Puebla, the Spanish ambassador, whom he suspected of duplicity in the matter, and subjected him to a storm of furious abuse. De Puebla must have passed a bad quarter of an hour, but, as he remarked, he did not so much mind as there was no witness to the interview. He explained that the treaty, by a mistake, had not been proclaimed in Andalusia. He wrote at once to King Ferdinand and asked him that right might be done. A few days later he reported that some members of the Privy Council had visited him on the same matter and that he had had a most unpleasant interview with them. He again begged Ferdinand to give satisfaction, as the English sailors were such savages that he went in fear of being stoned by them if reparation were not made.[[13]]