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Authors: Niall Ferguson

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And what of the English, whose territorial ambitions had once extended no further than France and whose one novel economic idea in the Middle Ages had been selling wool to the Flemish? How could they possibly sit on the sidelines with news coming in that their arch-foes the Spaniards and French were making their fortunes overseas? Sure enough, it was not long before the English joined in the race for overseas commerce. In 1496 John Cabot made his first attempt to cross the Atlantic from Bristol. In 1553 Hugh Willoughby and Richard Chancellor set off from Deptford to seek a ‘North-east Passage’ to India. Willoughby froze to death in the attempt, but Chancellor managed to get to Archangel and then made his way overland to the court of Ivan the Terrible in Moscow. On his return to London, Chancellor lost no time in setting up the Muscovy Company (its full name was ‘The Mystery and Company of Merchant Adventurers for the Discovery of Regions, Dominions, Islands, and Places unknown’) to develop trade with Russia. Similar projects proliferated with enthusiastic royal support, not only across the Atlantic but also along the spice route. By the middle of the seventeenth century England’s trade was flourishing from Belfast to Boston, from Bengal to the Bahamas.

The world was being carved up in a frenzy of cut-throat competition. But the question still remains: why did the Europeans seem to have so much more commercial fervour than the Chinese? Why was Vasco da Gama so clearly hungry for money – hungry enough to kill for it?

You can find the answer by looking at maps of medieval Europe, which show literally hundreds of competing states, ranging from the kingdoms of the western seaboard to the many city-states that lay between the Baltic and the Adriatic, from Lübeck to Venice. There were roughly a thousand polities in fourteenth-century Europe; and still around 500 more or less independent units 200 years later. Why was this? The simplest answer is geography. China had three great rivers,
the Yellow, the Yangzi and the Pearl, all flowing from west to east.
26
Europe had multiple rivers flowing in multiple directions, not to mention a host of mountain ranges like the Alps and the Pyrenees, to say nothing of the dense forests and marshes of Germany and Poland. It may just have been easier for marauding Mongols to access China; Europe was less readily penetrable by a horde on horseback – and therefore had less need of unity. We cannot be sure exactly why the Central Asian threat receded from Europe after Timur. Perhaps Russian defences just got better. Perhaps the Mongol horses preferred steppe grass.

True, as we have seen, conflict could be devastating in Europe – think only of the mayhem caused by the Thirty Years’ War in mid-seventeenth-century Germany. Woe betide those who lived at the frontiers between the dozen or so bigger European states, which were at war on average more than two-thirds of the time between 1550 and 1650. In all the years from 1500 to 1799, Spain was at war with foreign enemies 81 per cent of the time, England 53 per cent and France 52 per cent. But this constant fighting had three unintended benefits. First, it encouraged innovation in military technology. On land, fortifications had to grow stronger as cannon grew more powerful and manoeuvrable. The fate of the ruined ‘robber baron’s’ castle on the Tannenberg above Seeheim in southern Germany served as a warning: in 1399 it became the first European fortification to be destroyed using explosives.

At sea, meanwhile, ships stayed small for good reasons. Compared with the Mediterranean galley, the design of which had scarcely changed since Roman times, the late fifteenth-century Portuguese caravel, with its square-rig sails and two masts, struck an ideal balance between speed and firepower. It was much easier to turn and much harder to hit than one of Zheng He’s giant junks. In 1501 the French device of putting rows of cannon in special bays along both sides of a ship turned European ‘men of war’ into floating fortresses.
27
If it could somehow have come to a naval encounter between Zheng He and Vasco da Gama, it is possible that the Portuguese would have sent the lumbering Chinese hulks to the bottom, just as they made short work of the smaller but nimbler Arab dhows in the Indian Ocean – though at Tamao in 1521 a Ming fleet did sink a Portuguese caravel.

The second benefit of Europe’s almost unremitting warfare was
that the rival states grew progressively better at raising the revenue to pay for their campaigns. Measured in terms of grams of silver per head, the rulers of England and France were able to collect far more in taxation than their Chinese counterpart throughout the period from 1520 to 1630.
28
Beginning in thirteenth-century Italy, Europeans also began to experiment with unprecedented methods of government borrowing, planting the seeds of modern bond markets. Public debt was an institution wholly unknown in Ming China and only introduced under European influence in the late nineteenth century. Another fiscal innovation of world-changing significance was the Dutch idea of granting monopoly trading rights to joint-stock companies in return for a share of their profits and an understanding that the companies would act as naval subcontractors against rival powers. The Dutch East India Company, founded in 1602, and its eponymous English imitator were the first true capitalist corporations, with their equity capital divided into tradable shares paying cash dividends at the discretion of their directors. Nothing resembling these astoundingly dynamic institutions emerged in the Orient. And, though they increased royal revenue, they also diminished royal prerogatives by creating new and enduring stakeholders in the early-modern state: bankers, bond-holders and company directors.

Above all, generations of internecine conflict ensured that no one European monarch ever grew strong enough to be able to prohibit overseas exploration. Even when the Turks advanced into Eastern Europe, as they did repeatedly in the sixteenth and seventeenth centuries, there was no pan-European emperor to order the Portuguese to suspend their maritime explorations and focus on the enemy to the east.
29
On the contrary, the European monarchs all encouraged commerce, conquest and colonization as part of their competition with one another.

Religious war was the bane of European life for more than a century after the Lutheran Reformation swept through Germany (see
Chapter 2
). But the bloody battles between Protestants and Roman Catholics, as well as the periodic and localized persecution of Jews, also had beneficial side-effects. In 1492 the Jews were expelled from Castile and Aragon as religious heretics. Initially, many of them sought refuge in the Ottoman Empire, but a Jewish community was established
in Venice after 1509. In 1566, with the revolt of the Dutch against Spanish rule and the establishment of the United Provinces as a Protestant republic, Amsterdam became another haven of tolerance. When the Protestant Huguenots were expelled from France in 1685, they were able to resettle in England, Holland and Switzerland.
30
And, of course, religious fervour provided another incentive to expand overseas. The Portuguese Prince Henrique the Navigator encouraged his sailors to explore the African coast partly in the hope that they might find the mythical kingdom of the lost Christian saint Prester John, and that he might then lend Europe a hand against the Turks. In addition to insisting on exemption from Indian customs duties, Vasco da Gama brazenly demanded that the King of Calicut expel all Muslims from his realm and waged a campaign of targeted piracy against Muslim shipping bound for Mecca.

In short, the political fragmentation that characterized Europe precluded the creation of anything remotely resembling the Chinese Empire. It also propelled Europeans to seek opportunities – economic, geopolitical and religious – in distant lands. You might say it was a case of divide and rule – except that, paradoxically, it was by being divided themselves that Europeans were able to rule the world. In Europe small was beautiful because it meant competition – and competition not just between states, but also within states.

Officially, Henry V was king of England, Wales and indeed France, to which he laid claim. But on the ground in rural England real power was in the hands of the great nobility, the descendants of the men who had imposed Magna Carta on King John, as well as thousands of gentry landowners and innumerable corporate bodies, clerical and lay. The Church was not under royal control until the reign of Henry VIII. Towns were often self-governing. And, crucially, the most important commercial centre in the country was almost completely autonomous. Europe was not only made up of states; it was also made up of estates: aristocrats, clergymen and townsfolk.

The City of London Corporation can trace its origin and structure back as far as the twelfth century. Remarkably, in other words, the Lord Mayor, the sheriffs, the aldermen, Common Council, liverymen and freemen have all been around for more than 800 years. The Corporation is one of the earliest examples of an autonomous
commercial institution – in some ways the forerunner of the corporations we know today, in other ways the forerunner of democracy itself.

As early as the 1130s, Henry I granted Londoners the right to choose as their own sheriff and justice ‘whom they will of themselves’, and to administer their judicial and financial affairs without interference from the Crown or other authorities.
31
In 1191, while Richard I was crusading in the Holy Land, the right to elect a mayor was also granted, a right confirmed by King John in 1215.
32
As a result, the City was never in awe of the Crown. With the support of the City’s freemen, Mayor Thomas fitz Thomas supported Simon de Montfort’s revolt against Henry III in 1263–5. In 1319 it was the turn of Edward II to confront the City as the mercers (cloth dealers) sought to reduce the privileges of foreign merchants. When the Crown resisted, the ‘London mob’ supported Roger Mortimer’s deposition of the King. In the reign of Edward III, the tide turned against the City; Italian and Hanseatic merchants established themselves in London, not least by providing the Crown with loans on generous terms, a practice which continued during Richard II’s minority.
33
But the Londoners continued to challenge royal authority, showing little enthusiasm for the Crown’s cause during either the Peasants’ Revolt (1381) or the challenge to Richard’s rule by the Lords Appellant. In 1392 the King revoked London’s privileges and liberties, but five years later a generous ‘gift’ of £10,000 – negotiated by Mayor Whittington – secured their restoration. Loans and gifts to the Crown became the key to urban autonomy. The wealthier the City became, the more such leverage it had. Whittington lent Henry IV at least £24,000 and his son Henry V around £7,500.
34

Not only did the City compete with the Crown for power. There was competition even within the City. The livery companies can all trace their origins back to the medieval period: the weavers to 1130, the bakers to 1155, the fishmongers to 1272, the goldsmiths, merchant taylors and skinners to 1327, the drapers to 1364, the mercers to 1384 and the grocers to 1428. These guilds or ‘misteries’ exerted considerable power over their particular sectors of the economy, but they had political power too. Edward III acknowledged this when he declared himself to be ‘a brother’ of the Linen-Armourers’
(later Merchant Taylors’) Guild. By 1607 the Merchant Taylors could count as past and present honorary members seven kings and a queen, seventeen princes and dukes, nine countesses, duchesses and baronesses, over 200 earls, lords and other gentlemen and an archbishop. The ‘great twelve’ companies – in order of precedence: mercers, grocers, drapers, fishmongers, goldsmiths, skinners, merchant taylors, haberdashers, salters, ironmongers, vintners and clothworkers – are a reminder of the power that London’s craftsmen and merchants were once able to wield, even if their role today is largely ceremonial. In their competitive heyday they were as likely to fight as to dine with one another.
35

Among other things, this multi-level competition, between states and within states – even within cities – helps to explain the rapid spread and advancing technology of the mechanical clock in Europe. Already in the 1330s Richard of Wallingford had installed a remarkably sophisticated mechanical clock in the wall of the south transept of St Albans Abbey, which showed the motion of the moon, of the tides and of certain celestial bodies. With their distinctive hourly bells (hence the name: clock,
clokke
,
Glocke
,
cloche
), the mechanical clock and the spring-driven clock that supplanted it in the fifteenth century were not only more accurate than Chinese waterclocks. They were also intended to be disseminated, rather than monopolized by the Emperor’s astronomers. Thus, if one town’s cathedral installed a fine new dial in its tower, its nearest rival soon felt obliged to follow suit. If Protestant watchmakers were unwelcome in France after 1685, the Swiss gladly took them in. And, as with military technology, competition bred improvement as craftsmen tinkered to make small but cumulative improvements to the accuracy and elegance of the product. By the time the Jesuit missionary Matteo Ricci brought European clocks to China in the late sixteenth century, they were so much superior to their Oriental counterparts that they were greeted with dismay.
36
In 1602, at the request of the Wanli Emperor, Ricci produced a beautiful rice-paper map of the world, which depicted China at the centre of the earth. He must have known, however, that in terms of technology China was now drifting to the global periphery.

Because of the greater precision it permitted in measurement and
in the co-ordination of action, the rise of the clock and later the portable watch went (it might be said) hand in hand with the rise of Europe and of the spread of Western civilization. With every individual timepiece, a little bit more time ran out for the age of Oriental pre-eminence.

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