CHAPTER V
THE SPANISH COLONIAL SYSTEM
Colonies were one of the many new things which were introduced to Europe at the end of the fifteenth century. Of them mediæval Europe had known nothing since the dissolution of the Roman Empire; the means of communication were too bad, the Asiatic races were too powerful, and the Western world itself was too thinly populated to allow of distant excursions. The planting of settlements was familiar to both Greece and Rome. The Greek system was the simpler of the two, for the city state merely propagated itself by colonies as a plant propagates itself by seeds, and two cities existed instead of one, each independent of the other. But a Roman colony was incorporated as a subordinate and inferior part of the mother state. Greek history and literature were almost unknown in the Middle Ages, and even after the Renaissance they remained much less familiar than Latin. On the other hand, many European States, and especially Spain, inherited their law and their municipal systems from Rome, Latin was the international language, and the Church, by far the most powerful mediæval institution, was Roman. It is, therefore, not surprising that Spain followed the Roman colonial system, but all the circumstances were so different that beyond the mere incorporation and inferiority of the new dominions there was little other resemblance.
The main difference and the main characteristic of the Spanish colonial system was this—the colonies were the private property of the King of Spain. This, then, is the keystone of the edifice—that the dominions were vested in the Crown, not in the nation. The derivation of this theory is doubtless from the fact that in the early exploring days the Spanish and Portuguese kings were, really or apparently, private adventurers, and, in fact, the adventurers always assumed that they were stewards of royal estates rather than officers of a kingdom. Thus the colonies were the property of the King of Spain for the time being. Ferdinand had, in 1511, established a tribunal to manage his new property. This was the Council of the Indies, which made laws for the colonies and distributed all the appointments and acted as a Court of Appeal from the Audiencia in America. The King made all grants of land, and allowed the colonists only local liberties; the Spanish nation had no concern whatever in the matter. A modern parallel is the Congo Free State as it was a year or two ago. It is probable that the New World had little to complain of except in the matter of trade and commerce, but here the system was illiberal and short-sighted. The fifth share of the King in the produce of all the gold and silver mines was a small matter in comparison with the multitude of harassing restrictions,[38] which Spain never had the wisdom to cancel till it was too late. No colony was allowed to trade with any country except Spain; all the exports, whatever their destination, had first to go to the mother country, and the navigation laws were conceived in a similar spirit. The most glaring instance of stupidity was the prohibition of import trade laid upon Buenos Aires. No Atlantic colonial port might receive goods from Spain except Nombre de Dios. When Argentina purchased goods from Spain they were despatched across the Atlantic to Nombre de Dios, carried by mule across the Isthmus, transhipped to Callao, and then taken over innumerable mountains into the River Plate country. Merely to state such a system is to condemn it, but there was no possibility of altering it, because the whole shipping trade of Spain was in the hands of a syndicate of Cadiz merchants, and they were all-powerful.
As is well known, no foreign State was allowed to trade with Spanish America, nor was any foreigner even allowed to enter it without special permission. Various manufactures were forbidden, and even the cultivation of the vine and olive was placed under restrictions, as it was feared that their produce might compete with the produce of Spain. In fact, the ideal of the home-staying Spaniard was that the colonies should be mere mining-camps. Gold and silver were regarded as the whole of wealth, and it was considered the height of commercial wisdom to drain the whole produce of the mines of America into Spanish ports without allowing a fraction to be diverted elsewhere.
Thus legitimate trade was made extremely difficult, for the Spaniards even discouraged colonial exports from the fear that precious metals might be concealed among them. Accordingly, in 1599, the Governor of Buenos Aires was commanded to forbid exportation and importation alike under penalty of death. But the stringency of the various laws and regulations defeated their own objects, a gigantic contraband trade grew up, and all the officials, from the Governor downward, were implicated in it. Bribes accompanied almost every business transaction.[39] The manufactures of Europe were surreptitiously landed at Buenos Aires, and of course ruined the sale of the goods that had come over oceans, Isthmus, and mountains. This contraband trade was chiefly carried on by the English and the Dutch, and, as Professor Seeley has frequently pointed out, the power to trade with the New World formed for some two hundred years the chief bone of contention in the foreign politics of European countries. The practice of smuggling has had two marked and very pernicious effects upon Spanish-American character; it has fostered contempt of law and the preference of Government service to profitable industry. As the Argentines despised the laws of contraband, so they came to despise all laws, and during their independent history the shackles of the law have been cobwebs light as air to restrain individuals or communities from disturbing the public peace. In a word, out of the contraband trade sprang one of the worst features of South America—lawlessness and turbulence. It is obvious that it also fostered an almost equally injurious spirit—the craving of office. It was easier and more profitable to take bribes from the smugglers than to engage actively in smuggling, and so the tradition has descended to prefer the certain emoluments (direct and indirect) of office to the uncertain gains of trade. In Spanish America it is better to be the nephew of a President than of a successful trader. Of course, it would be absurd to attribute these two evils solely to the contraband trade, but the first has been undoubtedly encouraged, and the second, to a considerable extent, caused by the practice which was forced upon the Spanish colonies by an absurd fiscal system. The economic condition, therefore, of these countries appears to us very sombre. It must, however, be remembered that such treatment of "plantations" was the accepted policy of the age, and probably the reason why Spain was more unfortunate with her foreign possessions than other nations is rather to be found in the indolent character of her sons and her foreign embarrassments than in any particular set of restrictions.
Till the middle of the eighteenth century the principles of the Spanish colonial system were considered the last words of commercial policy by all nations and practically all individuals.[40] That great statesman, Lord Chatham, was fully convinced of the wisdom of these principles. He remarked: "Let the sovereign authority of this country over the colonies be asserted in as strong terms as can be devised, and be made to extend to every point of legislation whatsoever. That we may bind their trade, confine their manufactures, and exercise every power whatsoever, except that of taking money out of their pocket without their consent."[41] Indeed, the general commercial and colonial policy of Spain was at least as liberal as that of England, and was, during the half century preceding the Revolution, infinitely more liberal, and if we make allowance for the enlargement of the human mind in a hundred and fifty years, it must be admitted that the present commercial policy of the South American Republics compares unfavourably with the Spanish system. There was at least material prosperity. Adam Smith,[42] while censuring the Spanish system of government and considering it inferior to that obtaining in English colonies, recognised that great progress was being made. He says: "The Spanish colonies are under a government in many respects less favourable to agriculture, improvement, and population, than that of the English colonies. They seem, however, to be advancing in all these much more rapidly than any country in Europe. In a fertile soil and happy climate the great abundance and cheapness of land, a circumstance common to all new colonies, is, it seems, so great an advantage as to compensate many defects in civil government." It is impossible to put down the failure of Spain to anything but defect of character—the grand defect of mañana, of putting off every exertion till to-morrow, or rather for ever. But it cannot be denied that a hundred years ago the ill-starred country had to face a series of misfortunes which might well have disheartened a more energetic people. The revolutionary spirit which had spread all over the globe was at first wonderfully impotent in the Spanish settlements owing to the rigid disciplinary system which had been in force for upwards of two hundred years. Yet that of itself would have been enough to have taxed all the energies of an ancient and absolute monarchy. Further, Spain contrived to change sides in such a way during the war as to get all the hardships of defeat and none of the fruits of victory. When she was in alliance with France her fleet was destroyed by the English, and when she was in alliance with England her territory was overrun by the French. At this crisis also she was afflicted by the feeblest king of a feeble line and probably the worst queen and minister that ever lived. Under these circumstances it can hardly be a matter for wonder that she lost her colonies.
And yet if her general policy towards them be considered, it must be acknowledged that she deserved her fate less than any colonial power then existing. The Spanish merchants did indeed greatly hamper the development of South America, but they acted in obedience to a theory which was considered axiomatic and which was rigorously put into practice by every other nation. The King and the high officials always exerted their influence in favour of humane treatment of the Indians. Irala was conspicuous for his humanity, and the protective regulations which he put forward on their behalf and at the beginning of the seventeenth century, when reports reached Spain that the Indians in Tucuman were being ill-treated, it was ordered that Don Francisco de Alfaro, Auditor of the Supreme Court of Peru, should go to Paraguay and investigate the whole matter. The result was the Ordinances of Alfaro in 1612, which abolished both the forcible subjection of Indians and slavery, and substituted a small capitation tax. As we have seen, the Court of Madrid warmly seconded the early efforts of the Jesuits. The treatment, then, of subject races was as benevolent as circumstances and theories would permit, nor were the colonists in practice subject to any considerable severity. The commercial regulations were easily evaded, and the Argentina steadily advanced in prosperity.
The latter days of Spanish rule were extremely creditable to the sagacity and liberality of the Crown and its advisers. In 1764 a line of vessels was established to run between Corunna and various South American ports, with permission to carry Spanish merchandise and bring back in return the products of the colonies, and in 1774 the colonies were allowed intercommunication and trade. In 1778 a new commercial code was drawn up for the benefit of the Spanish Indies, and this was surprisingly liberal for those days. Nine ports in Spain and twenty-four in the colonies were declared "ports of entry," and goods, for the most part, were allowed to pass in and out freely. The general duty was nominally 3 per cent. on Spanish goods and 7 per cent. on foreign goods; but as the latter had to be shipped from Spain, the duty upon them was really 40 or 50 per cent. If we compare this scale with that now in force, we shall see how greatly South America has retrograded since the removal of the control of Spain. It is interesting to remember that these beneficent regulations were framed while Smith was publishing the "Wealth of Nations," and that therefore backward Spain anticipated both Pitt and Huskisson.