Number 65. Reply to the damages of the commerce of Filipinas; and to the first, regarding the withdrawal of the silver.
These two reasons are [alleged as] those which hinder the advancement of the islands, and restrict its commerce. However, a reply is not lacking, which, if it does not destroy, weakens them. For to the first, regarding the withdrawal of the silver and its retention in China, answer is made, that on the silver which goes [from Nueva España] nine per cent [duties] are paid at Manila, and at Acapulco fourteen per cent, a total of twenty-three per cent. Consequently, the duties on its transportation to España are not lost, for they are paid there in larger measure. The effects are not those which are represented; for, although it is true that the silver goes from Manila, it is for China, and for the very reason that it does not issue from that country, it does no harm. But the retention of what comes to these kingdoms is a greater injury, as it all goes to Olanda, Genova, and Venecia [Venencia—MS.], and thence to Turquia, while some portion goes to India by way of Portugal, and those same Dutch, and the Persians, Arabs, and Mogores share the silver; and, although at last it goes to remain in China, it is after it has enriched the greatest enemies of this crown. That is not the case with what goes by way of Manila; for, if it goes thence, it is through the hands of your Majesty’s vassals, and it does not reach the hands of the enemies. But even this reply is superfluous, for it is not necessary to the islands nor to their inhabitants that more silver be sent to Manila than is permitted; rather is it important to them that the [amount for which] permission be observed and executed with rigor, as will be said. [In the margin: “In numbers 98 and 99.”] Therefore, of the damages caused to the commerce of España by that of Filipinas, only that to the merchandise should be made good; for the silver either is within the limits of the permission, and does not conflict [with this statement] (for neither does it cause any loss, nor can it be dispensed with), or it is in the illegal amount that is stated, and the citizens request that this be corrected and prevented. For if there is any damage to España, it is not any advantage to them; but, on the contrary, destroys and ruins them, as will be seen.
Number 66. Reply to the statement touching the merchandise exported from the islands
As for the second reason—that of the merchandise, and the trade of the islands therein—it is not denied that it would have the effects that have been stated, if it were free, open, and without restriction; but these cease, because experience and good government have chosen a method such that neither the commerce of España should be destroyed, nor that of the islands be annihilated, by permitting the commerce to one in such quantity that it should not prove damaging to the other. And although España petitioned that the commerce from Filipinas be totally suppressed, by which they thought that they would assure their own increase, it was also considered that the islands would surely be lost in that case; and that they would be settled by the Dutch, who would make themselves masters of all the Orient. Consequently, that would not only expose India to evident danger, as has been proved, but would also, by increasing the forces of the Dutch, render them more powerful in the trade of the Indias, and in all the regions where they navigate and traffic. Therefore, if the trade of [the merchants in] España should increase for the one reason, their risks and expenses would be greater for another; and nearly all the trade of Portugal would be ruined. Thus from an imagined benefit would result damages so certain and considerable that, were they weighed as they ought to be, the present losses would be considered as more tolerable. Such is the mutual relationship of states which are many and extended that, if attention to all of them be difficult, it is advisable that decisions be adjusted to the least harmful course. Accordingly, it is proper that the islands should not continue to increase, but that they be allowed the commerce that is sufficient to maintain them; and that that of España should not be increased in that region, but that the trade of the islands be restricted in such manner that it shall be as little obstructed as possible. For, by each kingdom losing a part of its right, all will be maintained and conserved.
Number 67. Commerce of España with the Indias: why it is decreasing
This will be more apparent with the conditions and the changes which the commerce of Filipinas and that of España in the Indias have sustained and suffered. That of España has decreased so much from its usual status that it appears to be less than the half of its former amount. Although the fault is attributed to the Filipinas, that is because the matter is not probed below the surface, and causes are not sought at their sources. The physician who understands only the effect of a dangerous illness, namely, the death of the patient, generally attributes the sickness to uncertain causes and sometimes so remote that they have no connection with the case in question; and, since he prescribes his remedies for such causes, the true, proximate, and essential causes which are working out of sight without any check, end, if not by killing the patient, by placing him in evident risk. All see and recognize that the commerce of the Indias is in a feeble condition, that the merchants are losing, that the exporters do not obtain their capital [from what they ship], and that the ships which go are smaller, and return with poorer cargoes. Although this loss is so well known, there are some who ascribe the cause of so great an effect to the Filipinas, and not to the misapprehension of España—which is persuaded that the wealth of the Indias must be inexhaustible, and that the merchants can still gain on their investments the same amounts as fifty years ago, while the causal means of it all have been lacking, which have been noticed by few, and ignored by many.
Number 68. First reason for the decline of the commerce of the Indias
First, the abundance of gold and silver. So great was the abundance of these metals in the Indias, that one could say the same as of Jerusalem in the time of Solomon, that they were regarded as the stones of the street. Accordingly, articles were paid for at so exorbitant prices, as is apparent from the histories of their conquests. That region has failed, for the ores that yielded three hundred pesos per quintal by smelting, now yield eight or six by quicksilver, which costs more than smelting; and [such ores] are worked as good ones. Potosi, which is the heart of the Indias, is threatening to give out; for it alone yielded for forty years an amount that it cannot now yield, although aided by the opening of many mines which sustain its reputation. The mines of Nueva Reino [i.e., New Granada] and of Nueva España have lost a part of what they had. The cost of mining is greater, the mines are poorer, and, consequently, the gains less, and less the amount obtained. Therefore, since this was the first cause of the greatness of the Indias, it is not remarkable that with its deficiency their commerce has declined.
Number 69. Second cause for the decline of the commerce of the Indias
The second cause is the decrease of the Indians and the increase of the Spaniards. The latter number thirty times more than formerly; where there were five hundred, there are now three or four thousand. Without exaggeration, there has been a decrease of the Indians of more than six millions. Although not all of them used Spanish commodities, they consumed many, and to so great an excess that it became advisable to prohibit this to them and order them to dress as did their ancestors. What is most to be regretted is the cessation of the service for the mines, the cultivation of the fields, the gross sum of the tributes, and the local commerce of many provinces. With fewer people and less wealth, there must be less consumption and smaller profits; and, if everything diminish, it is impossible that trade should not do the same.