The Decline of Spanish Power in the Seventeenth Century Crisis
The seventeenth century crisis profoundly impacted Spain, marking the end of its European dominance through a complex web of economic, social, and political challenges. Madrid, despite being the capital, struggled with severe economic imbalances characterized by massive expenditures and an underdeveloped middle class. A pivotal moment came in 1609 when the expulsion of former Muslims led to a critical shortage of skilled workers, devastating the economy.
The Spanish nobility's disdain for manual labor and the proliferation of monasteries further weakened the economic foundation. The textile industry, once vibrant, collapsed under rising production costs, forcing widespread worker layoffs. Agricultural production plummeted due to multiple factors: aristocrats implementing excessive rent increases, crushing tax burdens driving peasants from their lands, and a stubborn rejection of agricultural innovations from Protestant nations like England and Holland.
Highlight: The Spanish crown's financial mismanagement led to multiple national bankruptcies and currency devaluations, destroying national credit and economic stability.
The political leadership proved inadequate to address these mounting challenges. Philip III delegated power to the Duke of Lerma, who prioritized personal enrichment over national interests. His successor, Philip IV, appointed the Count-Duke of Olivares, who, despite similarities to Cardinal Richelieu, failed to prevent Spain's decline. The nation became entangled in costly conflicts, including wars with the Dutch Republic, France over Mantua (1628-1659), and involvement in the Thirty Years' War.