How the West Won: The Neglected Story of the Triumph of Modernity (31 page)

And military technology was just the beginning.

Capitalism Moves North

For several centuries, buyers for the Italian city-state exporting companies crisscrossed northern Europe seeking goods for resale around the Mediterranean. At first they did their buying at the great trade fairs held periodically in the Champagne region and other northern locations, but eventually they bought directly from local producers. This was especially true of woolen cloth from Flanders. To facilitate these transactions, many Italian banks opened branches in Flanders. These banks were sophisticated capitalist firms, run by well-trained executives hired and promoted on the basis of ability, not family ties.

In Flanders, the Italians not only organized a backward, inefficient woolen industry but also dealt with a repressive, counterproductive set of merchant weavers’ guilds. With the full backing of the local ruler in return for regular permission fees, the merchant weavers’ guilds in the various towns and cities of Flanders operated as cartels, restricting the industry and punishing nonconformists. For example, anyone found to have varied the formula for a popular scarlet dye faced a huge fine—and
if he didn’t pay, he would lose his right hand.
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Guild rules limited the number of looms firms could own, usually to fewer than five. They controlled prices and forbade bargaining, thereby limiting any benefits of increased efficiency. The weavers’ guild also set the length of the working day and required all firms to comply.
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The guild set wages as well. The wage levels applied not only to hired weavers but also to wool washers, carders, spinners, dyers, fullers, shearers, and everyone else in the industry. Because only weavers with their own shops could belong to the guild, management alone dictated wages. No variations in wages were allowed from one firm to another, and any and all forms of collective bargaining for higher wages were prohibited not only by guild rules but usually by local law as well. The result was an unproductive and uncreative wool industry.

As Italian bankers surveyed this scene, they realized the immense economic gains to be made if they overcame the guild system. They approached the problem with both a carrot and a stick. The stick involved inviting large numbers of cloth makers to emigrate to Italy, where they were given special privileges in exchange for launching a woolen industry. For example, as the economic historian Eleanora Carus-Wilson pointed out, a statute enacted in Padua in 1265 exempted “foreigners who came into the city to make cloth … from all tolls and customs duties and later also from personal taxes.”
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The carrot was the promise of far greater incomes for everyone if the guilds surrendered. The bankers eventually won everyone over and delivered as promised, supplanting the merchant weavers’ guilds with well-managed firms that integrated the entire woolen industry: importing the fleeces, coordinating all the steps and hiring all the subcontractors necessary to turn wool into cloth, and then exporting the cloth based on market conditions. In addition to its more expensive luxury woolens, Flanders soon began to produce less expensive varieties, which led to an immense increase in sales.

The woolen industry prospered in Flanders for several centuries, despite a great deal of social turmoil and war. Then, late in the thirteenth century, France annexed southern Flanders. Although northern Flanders held off the French, the destruction of the wool industry in the South had serious consequences: some companies moved north to escape French taxes and repression, many others went to Italy, and still others went to England. Eventually the whole of Flanders was taken over by the Spanish, who wrecked its commercial and industrial institutions. At the end
of the fifteenth century the continental woolen industry and aggressive capitalist firms were driven north to Amsterdam. All this gave England a huge opportunity.

English Capitalism

As in Flanders, capitalism came to England in the form of Italian semi-colonialism. Italian banks proliferated in England (and Ireland) during the thirteenth century,
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a fact acknowledged in the Magna Carta, signed in 1215, which guaranteed the rights of foreign merchants to enter the country and conduct their business without hindrance. By the start of the thirteenth century London had foreign merchant enclaves quite similar to those Western colonialists formed in Asia centuries later. But this was
semi
colonialism because foreign merchants operated in England only at the pleasure of the Crown and were not backed by military pressure.

Secure behind the Channel, the English had become one of the major Western powers, blessed with exceptionally productive agriculture, vast mineral resources, and abundant water power. So it was only a matter of time before they went into business for themselves, imposing unfavorable taxes and duties on foreign firms and products. Even so, it was the remarkable rise of political freedom that gave greater impetus to English capitalism. As made explicit in the Magna Carta, the English merchant enjoyed secure property rights and free markets, unlike early capitalists in southern Italy and those in the Walloon area of Flanders, who were destroyed by despots. Freedom and the security of property spurred innovation, with the result that English industries developed or exploited technologies far superior to those used by their European competitors. When the Industrial “Revolution” began in the eighteenth century, it was not a revolution at all but part of an
evolution
of invention and innovation that had begun in England perhaps as early as the eleventh century.

As was the case in Flanders, capitalism first came to England in response to the woolen trade, and the early development of English capitalism took place almost entirely within this single industry. Therefore, close examination of how capitalism transformed the English woolen industry offers the most revealing perspective on the rise of English industrial capitalism.

From Wool to Woolens

The basic contours of this story are clear in table 9–1 (all figures have been rounded). In the thirteenth century England was, in effect, a vast sheep ranch serving the continental woolen industry. English exports of cloth were so insignificant that no tax records exist, but exports of wool climbed rapidly, from an annual average of 17,700 sacks in 1278–80 to 34,500 sacks in the first decade of the fourteenth century, or almost 9 million fleeces (the standard sack of wool contained about 260 fleeces).
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But the dynamic soon changed. The first statistics on cloth exports become available in the middle of the fourteenth century, and the annual figure jumps from 4,400 bolts exported in 1347–48 to 31,700 bolts at the beginning of the fifteenth century. Meanwhile, fleece exports dropped, from about 33,700 sacks of wool a year to only 13,900. From the turn of the century on, cloth exports rose rapidly and fleece exports declined: by 1543–44 annual English cloth exports amounted to 137,300 bolts, and fleece exports were down to an insignificant 1,200 sacks.

Table 9–1: English Wool Exports: 1278–1544

The table reflects the rise of the English woolen industry, propelled by the development of English cloth-making firms and the imposition of taxes and export duties specifically designed to keep the superb English wool out of the hands of foreign weavers. Not surprisingly, as the domestic woolen industry took off, the English no longer needed to import most
of their cloth. During 1333–36, imports averaged about 10,000 bolts of cloth a year; just two decades later, by 1355–57, the number of imported cloths had dropped to about 6,000 bolts per year.
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The English eventually dominated the world woolen market, maintaining their preeminence for centuries.

One factor in this rise to prominence was the superiority of English local wool. Even in the early thirteenth century, when English woolen manufacturing operated on a small scale, wealthy Europeans would buy only English cloth,
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the best of which was often dyed scarlet and esteemed by European royalty. The Venetians were concerned enough about their English rivals to impose a special import tariff on English woolens in 1265. The lesson was not lost on the English Crown, and ten years later the king imposed an export duty on English fleeces. This meant, of course, that English cloth makers could buy the superior English fleeces much cheaper than could cloth makers in Flanders and Italy and could sell the finished cloths abroad for less.

But there was more to English control of the wool market than just having the best fleeces and favorable government tax policies. Like the Italian woolen industry before it, the English industry benefited from substantial immigration of skilled artisans from Flanders. In 1271 King Henry III decreed that “all workers of woollen cloths, male and female, as well as of Flanders as of other lands, may safely come into our realm, there to make cloths,” and he made them tax-exempt for five years.
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In 1337 Edward III extended these benefits to Flemish cloth makers and even sent recruiters among them. Some entrepreneurs brought their entire firm, workers and all, to England. These people were not simply inclined to flee the civil disturbances that beset Flanders; they were drawn to England because of greater freedom, political stability, lower costs, finer raw materials, and superior technology—and, most of all, higher wages and profits.

Perhaps the most remarkable feature of the English wool industry was dispersion—the fact that English woolen firms were scattered throughout the rural countryside. This dispersion, which became a defining characteristic of many other English industries, occurred owing to both technological and political reasons.

The Thirteenth-Century Industrial Revolution

In 1941 Eleanora Carus-Wilson pointed out that from very early days the English woolen industry had migrated from urban locations to villages and rural areas. Why? Several factors were involved, but water-powered fulling mills played such an important role that Carus-Wilson entitled her famous paper “An Industrial Revolution of the Thirteenth Century.”
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Fulling is a major step in producing good cloth. When cloth comes from the loom it is quite loose. The process of fulling involves submerging a cloth in water (usually containing a natural clay detergent called fuller’s earth) and beating it vigorously. Proper fulling will shrink the cloth, making the fabric tighter and stronger, and make the surface smoother and softer.
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Three traditional methods of fulling were used: a submerged cloth was beaten with the feet, with the hands, or with clubs. A wall painting in Pompeii shows a nearly naked fuller standing in a trough, stomping on a cloth. These traditional methods were still used in Flanders, Italy, and, for a time, England. But then, in the eleventh or twelfth century (historians disagree on the precise date), a new method was introduced: two wooden hammers were attached to a drum and turned by a crank to raise and drop on the cloth. The real breakthrough came when this device was hooked to a water mill (one probably constructed to grind grain). As a result, a single operator overseeing a series of hammers could perform the work that had previously required a crew of fullers—and he could do it much more quickly, too.
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This is why Carus-Wilson observed that the invention of the fulling mill “was as decisive an event [for the woolen industry] as were the mechanization of spinning and weaving in the eighteenth century.”
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Whether fulling mills developed in the eleventh or twelfth century, they were so common in the thirteenth century that they revolutionized the English industry, leaving the Continent far behind. Fulling gave English cloth a significant advantage on the international market. With many fewer fulling mills, cloth makers on the Continent could full only
some
of their cloths, which entailed a large sacrifice in quality.
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The ascendance of the fulling mill helps explain the English woolen industry’s marked preference for villages and rural areas on good streams.
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Such locations had several additional advantages. Moving water was useful for dyers, who needed to rinse excess dye from their cloths. Moreover, locating in rural areas permitted firms to escape repressive guild
regulations, to pay lower taxes than those imposed by towns and cities, and to pay lower wages (the cost of living was lower in rural areas than in cities).
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