Tag: finance

William the Conqueror and his sons amazed continental contemporaries by the extent of their financial resources. Their financial resources were great not only because of England’s wealth, for certainly, taken as a whole, the kingdoms of France and Germany were much richer, but because the Anglo-Norman king was able to tax the resources of his realm to a degree far exceeding that of any ruler in Europe. Money was needed to support the king and his family, his central administration, his local representatives, and his military establishment. The relative effectiveness of English royal taxation inaugurated by William the Conqueror is an important key to the political history of the Middle Ages. It helps to account for the fact that as late as the fifteenth century the king of England was able to inflict crushing defeats upon French kings, who ruled a country with three times the population of England and whose landed, commercial, and industrial wealth, if we could estimate it precisely, would be even greater. In the Middle Ages, no less than in the twentieth century, wars cost money, and the power of any particular king was greatly dependent upon the comprehensiveness and efficiency of his taxation system. In this regard the Anglo-Norman king was at least a century ahead of the Capetian monarchy, and no German ruler of the twelfth and thirteenth centuries ever had any comparable command of the financial resources of his country.

The chief source of income of early medieval kings had been their own estates, and William naturally drew a substantial part of his income from the royal demesne, whose administration was the sheriffs responsibility. The law courts were also a lucrative source of income, but it was their clever and unrelenting use of the feudal possibilities for taxation that accounts for the great financial resources of the Anglo-Norman rulers. Like any other feudal lord, William enjoyed the prerogatives of relief, wardship, and the regular aids, and his treasury found that these old institutions could be made to produce great sums. Not only the lay vassals but also the bishoprics and abbeys that owed feudal obligations to the crown, were subjected to this kind of taxation. In addition to all these sources of royal income William inaugurated the practice of allowing his vassals the option of not sending their knights to serve in the feudal host on payment of a certain sum per knight’s fee; the practice came to be called scutage (literally, “shield money”) in the early twelfth century. William’s tenants-in-chief were glad to be freed of the burden of keeping their knights trained and equipped for war, and William preferred to use the income he obtained from scutage to hire mercenaries for his continental wars. Paradoxically, the same king who brought feudal institutions to their highest refinement and used them most effectively for enhancing royal power was the earliest to realize the inefficiency of the feudal method of raising armies. By feudal law the vassals were required to serve only forty days a year, which was a tremendous nuisance in a long campaign; the knights who were provided to his feudal host were not always adequately prepared and armed; it was advisable to leave most of the English army at home in case of another Scandinavian invasion, which threatened during most of the Conqueror’s reign; and William had the special problem of transporting the knights and horses across the channel, which was both expensive and risky. He preferred to hire mercenaries among the landless knights of Normandy, Flanders, and Brittany for his frontier campaigns against various French princes. The Anglo-Norman monarch’s envious continental enemies were not slow to realize the significance of this military innovation. A chief minister of the French king in the first half of the twelfth century referred to the English ruler as “that wealthy man, a marvelous buyer and collector of knights.” William initiated the slow substitution of mercenary forces for feudal armies, which is one of the central military developments of the High Middle Ages.

— The Civilization of the Middle Ages, Chapter 12

The great limitation on the equipment of the Army of Flanders in the sixteenth century [C.E.] was financial: a pike and body-armour (the corselete) cost 30 florins in the 1590s, a musket cost 10 florins, a 24-pounder cannon cost 1,000 florins. With prices like this, there was never enough money to arm all of the soldiers all of the time. There was only limited concern about this: sixteenth-century strategists believed that wars should be fought with men, not material…and faced with a choice between feeding their men or equipping them, they always chose food. Eight hundred men could be fed for a month with the money required to cast one cannon; a pike-man could be given bread for two years with the price of his corselet.

Only gradually did the Army systematize the supply of weapons to its men, deducting the cost of arms, powder and shot by [installments] from their future wages….

Arms and armour were…provided on credit to the troops by contractors engaged by the government. This was essential since few men could afford to purchase their own firearms (a musket cost 10 florins in the 1590s, more than a musketeer’s wage for a month), but it was perhaps shortsighted to charge the powder and shot used by each man against his account—it was hardly an encouragement for a marksman to use his weapon! In their defence the government argued that the musketeers and arquebusiers already drew a slightly higher wage to cover the cost of using their guns, but of course this was only effective when wages were actually paid….

— The Army of Flanders and the Spanish Road 1567-1659, pp. 48-49, 165

Asked to give his verdict on the foreign policy of Queen Elizabeth, Sir Walter Raleigh replied that: “Her Majesty did all by halves.” It was a fair criticism, but it was one which could be levelled against every European ruler at the time: against the kings of France and Spain, the German Protestant princes, even against the [Dutch] States General. None of them would or could put all their eggs in one basket. All of them tried to win their wars by “half-doing”. The casual character, the insouciance, of the Eighty Years’ War in particular stands out as one of its most important and most persistent traits.

Yet what alternative was there? Certainly the fate of the Netherlands was important to Spain, England, France and Germany, but was it more important than their commitments or ambitions elsewhere? Should England abandon her position in Ireland in order to support the Dutch; should Spain neglect the defence of the Mediterranean in order to suppress the revolt in the Low Countries? These were real choices, for no European state in the early modern period possessed sufficient resources to fight effectively in the Netherlands and also attain its political objectives elsewhere. The policies of the various major combatants in the Low Countries’ Wars must therefore be considered within the context of their overall foreign ambitions and overseas commitments; changes in one were normally linked with changes in the other; the course of the war was often affected by events far outside the Netherlands. From the very first, as we shall see, the Dutch Revolt was a problem which no government could tackle in isolation.

— The Army of Flanders and the Spanish Road 1567-1659, p. 231

Every captain in an early modern army held enormous power over the rank and file of his company. In absolute charge of discipline he could flog, fine, or otherwise humiliate his men whenever he chose; because he alone decided who should perform sentry guard and other onerous duties, the captain was free to victimize the men he disliked and excuse his friends…. [Without] interference from above, [a Spanish Empire] captain chose the two sergeants and eight corporals of his company (the cabos de escuadra or corporals were in charge of twenty-five men and received a wage-bonus of 3 escudos each per month), and he distributed at his pleasure 30 escudos of treasury bonus-pay among his men. As if this were not enough, the insolvency of the military treasury made the company captains into money-lenders and welfare-officers as well. Every company had a chest (caja) kept by the captain and used by him to advance subsistence wages (the socorro) to necessitous men when no money arrived from the treasury. The captains were also responsible for ransoming, re-arming, or re-horsing any of their men who had the misfortune to lose their liberty, their weapons, or their mounts. Naturally when the treasury did contrive to pay an [installment] of wages the captains expected to receive it first in order to deduct the sums already advanced “on account”. The scheme was excellent in principle, but it assumed that all captains were honest and scrupulous men. Of course they were not…. “The arrangements for paying the troops played right into the eager hands of the captains, who took full advantage of the generous opportunities afforded them.”

— The Army of Flanders and the Spanish Road 1567-1659, p. 160

Some time in 1614 [C.E.] a complete set of toy soldiers, made of wood, was presented to the young prince of Spain, later King Philip IV. There were regiments and companies with their various banners, weapons and equipment, there were horses and cannon for the artillery, even the distinctive shops and tents of the armourers, sutlers and barbers who followed every army. Special materials were included for the construction of artificial lakes, forests and pontoon bridges, and there was a toy castle for the “army” to besiege. And this, the first child’s “war-game” known in Europe, was proudly described by its inventor in a special publication in Spanish and Latin. The toy was no less grandiose in intention than in execution: it was to give education as well as enjoyment. “This army will be no less useful than entertaining” the designer, one Alberto Struzzi, wrote to the prince. “From it one may observe the expenditure which is necessary if a King is to emerge victorious, and how if money (which is the sinews of war) fails, the prince’s intentions cannot be achieved.” Armies which are not paid invariably fall prey to disorders, desertion and defeat, warned the inventor.

The ultimate aim of this war-game was to make Prince Philip aware of the existence of the Spanish Netherlands and of the army which defended them. The prince’s splendid toy was in fact a perfect replica of the most famous army of the day, the Army of Flanders, maintained by Spain in the Low Countries since 1567. It was never too early to teach a future king of Spain that his power was underpinned largely by military strength and that his armies could function only for as long as they were paid.

— The Army of Flanders and the Spanish Road 1567-1659, p. 3

…Raising money to pay the cost of war was to cause more damage to 14th century [C.E.] society than the physical destruction of war itself. The governing fact was that medieval organization by this time had passed to a predominantly money economy. Armed forces were no longer primarily feudal levies serving under a vassal’s obligation who went home after forty days; they were recruited bodies who served for pay. The added expense of a paid army raised the cost of war beyond the ordinary means of the sovereign. Without losing its appetite for war, the inchoate state had not yet devised a regular method to pay for it. When he overspent, the sovereign resorted to loans from bankers, towns, and businesses which he might not be able to repay, and to the even more disruptive measures of arbitrary taxation and devaluation of the coinage.

Above all, war was made to pay for itself through pillage. Booty and ransom were not just a bonus, but a necessity to take the place of arrears in pay and to induce enlistment. The taking of prisoners for ransom became a commercial enterprise. Since kings could rarely raise sufficient funds in advance, and collection of taxes was slow, troops in the field were always ahead of their pay. Loot on campaign took the place of the paymaster. Chivalric war, like chivalric love, was, as Michelet said of the whole epoch, double et louche (a provocative phrase which could mean “double and squinting” or “equivocal” or “shady” in the sense of disreputable). The aim was one thing and the practice another. Knights pursued war for glory and practiced it for gain.

— A Distant Mirror, Chapter 4

Emphasis mine.