(^106) Chapter Three
But such measures might severely diminish the taxpaying capacity of
the population, as the wars in the Low Countries also illustrated. Thus,
for example, the mutinous Spanish soldiers who sacked Antwerp in
1576 attacked the richest city in northern Europe when Philip II’s
bankruptcy made it clear that they would not receive the back pay the
king owed them. The city never fully recovered from the “Spanish
Fury,” largely because the metropolitan financial and commercial role
Antwerp had filled since the fifteenth century passed to Amsterdam in
the rebel-held portion of the Netherlands.
This rapid relocation of financial activity resulted from the actions
of innumerable private individuals who decided that their goods and
money would be safer in Holland, where burghers were in political
control, than in Spanish-ruled Antwerp. Private decisions of this sort
meant that capital could migrate very rapidly to places where protec
tion costs were judged to be at a minimum. Capitalists who failed to
get away from heavily taxed places soon saw their resources wither to
insignificance. This was the Fuggers’ fate; the fortunes of that house
never recovered from Philip II’s bankruptcy of 1576, any more than
Antwerp did. Other successful entrepreneurs (or their sons) were
attracted to the display and extravagance of a nobler way of life, and
either withdrew entirely from commerce or let their business affairs
languish from neglect. Only in the atmosphere of a society molded
around the activities of wheelers and dealers in the marketplace could
the accumulation of capital and the maximization of pecuniary profit
continue to flourish, year in and year out. A degree of political au
tonomy to assure effective insulation from confiscatory taxation was
essential for the survival of such communities, even when, as in the
case of London, they were mere enclaves in a larger political fabric.^36
On the other hand, rulers and ruled had a common interest in
substituting regular taxation for irregular plundering. This common
interest allowed rulers to increase tax assessments in all important
European states little by little, though governmental income con
tinued to lag systematically behind military and other costs. Periodic
bankruptcies resulted when rulers stopped payment on their debts,
thereby precipitating a financial crisis which lasted until some settle
ment between creditors and the insolvent ruler could be negotiated.
- Cf. Richard Ehrenberg, Capital and Finance in the Age of the Renaissance (London,
n.d.); Frank J. Smoler, “Resiliency of Enterprise: Economic Crisis and Recovery in the
Spanish Netherlands in the early 17th century,” in Carter, From Renaissance to Counter-
Reformation. pp. 247–68; Geoffrey Parker, “War and Economic Change: The Economic
Costs of the Dutch Revolt,” in Winter, War and Economic Development, pp. 49–71.