The British Museum’s Kakiemon elephants tell a story of the whole world in the seventeenth century. Japanese craftsmen, although cut off from the outside world, were using techniques borrowed from China and Korea to make images of animals from India, to suit the tastes of purchasers in England, mediated by the Dutch through the first trading company with a truly global reach. It is a fine example of how the continents of the world were for the first time being linked together by ships and by trade. This new world now needed a functioning means of exchange – an international currency. The next chapter describes what underpinned these early years of worldwide commercial activity: silver, mined in South America, minted into Spanish pieces of eight and exported to the world – the first global money.
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Pieces of Eight
Spanish coins, minted in Potosí, Bolivia
MINTED AD 1573–1598
Money, advertisers assure us, will let us buy our dreams. But some money, and especially coins, is already the stuff of dreams, with names that ring to the magic of history and legend – ducats and florins, groats, guineas and sovereigns. But none of those can compare with the most famous coins of all – pieces of eight. Familiar in books and films from Treasure Island to Pirates of the Caribbean, they carry with them a freight of associations – of armadas and treasure fleets, wrecks, battles and pirates, the high seas and the Spanish Main.
But it isn’t just thanks to Long John Silver’s parrot that pieces of eight are the supreme celebrity among world currencies. For the peso de ocho reales, the Spanish piece of eight, was the first truly global money. It was produced in huge numbers, and within twenty-five years of its first minting in the 1570s it had spread across Asia, Europe, Africa and the Americas, establishing a global dominance that it was to maintain until well into the nineteenth century.
By modern standards a piece of eight is a large coin. It is about 4 centimetres (1.5 inches) across and has a good weight – roughly the same as three £1 coins. This particular coin is a dullish silver colour, thanks to surface corrosion, but when it was freshly minted a piece of eight would have glittered and shone. Around 1600 this piece of eight would probably have bought, in modern terms, something like £50 worth of goods – and could have been spent practically anywhere in the world.
The Spaniards had been drawn to America by the lure of gold, but what made them rich there was silver. They quickly found and exploited silver mines in Aztec Mexico, but it was in Peru, in the 1540s, that they really hit the silver jackpot – at the southern end of the Inca Empire at a mountainous place called Potosí, now in Bolivia, which quickly became known as the Silver Mountain. Within a few years of the discovery of the Potosí mines, silver from Spanish America began to pour across the Atlantic, growing from a modest 148 kilos a year in the 1520s to nearly three million kilos a year in the 1590s. In the economic history of the world, nothing on this colossal scale, or with such grave consequences, had ever happened before.
The isolated hill of Potosí sits 3,700 metres (12,000 feet) above sea level, on a high, arid and very cold plateau in the Andes – one of the most inaccessible parts of South America. Despite this remoteness, the silver mines required so much labour that by 1610 the population of this village had grown to 150,000, making it a major city by European standards of the day, and an unimaginably rich one. In 1640, a Spanish priest rhapsodized about the mine and what it was producing:
The abundance of silver ores … is so great that, if there were no other silver mines in the world, they alone would suffice to fill it with wealth. In their midst is the hill of Potosí, never sufficiently praised and admired, the treasures whereof have been distributed in generous measure to all the nations of the world.
Without Potosí, the history of sixteenth-century Europe would be very different. It was American silver that made the Spanish kings Europe’s most powerful rulers and paid for their armies and armadas. It was American silver that allowed the Spanish monarchy to fight the French and the Dutch, the English and the Turks, establishing a pattern of expenditure that was ultimately to prove ruinous. Yet for decades the flow of silver provided rock-solid credit for Spain through the direst crises and bankruptcies: it was assumed that next year there would always be another treasure fleet, and there always was. ‘In silver lies the security and strength of my monarchy,’ said King Philip IV.
The production of this wealth came at a huge cost in human life. At Potosí young native American men were conscripted and forced to labour in the mines. Conditions were brutal, indeed lethal. In 1585 one eyewitness reported:
The only relief they have from their labours is to be told they are dogs, and to be beaten on the pretext of having brought up too little metal, or taken too long, or that what they have brought is earth, or that they have stolen some metal. And less than four months ago, a mine-owner tried to chastise an Indian in this fashion, and the leader, fearful of the club with which the man wished to beat him, fled to hide in the mine, and so frightened was he that he fell and broke into a hundred thousand pieces.
In the freezing high altitude of the mountains, pneumonia was a constant danger, and mercury poisoning frequently killed those involved in the refining process. From around 1600, as the death rate soared among the local Indian communities, tens of thousands of African slaves were brought to Potosí to replace them. They proved more resilient than the local population, but they, too, died in large numbers. Forced labour in the silver mines of Potosí remains the historic symbol of Spanish colonial oppression.
Disturbingly, and to the dismay of many Bolivians, the Potosí silver mine is still a tough and unhealthy place to work. The Bolivian former head of a Potosí UNESCO project, Tuti Prado, tells us about it:
Potosí, for today’s population, is one of the poorest places in the country. Of course, the technology is different, but the poorness, the health, is as bad as 400 years ago. We have a lot of children working in the mines, and many of the miners don’t live more than 40–45 years – even 35 years of age – because of silicosis of the lungs and because of the dust.
The Potosí mines produced the raw material that made Spain rich, but it was the Potosí mint, fashioning the silver pieces of eight, which laid the foundations of a global currency. From Potosí the coins were loaded on to llamas for the two-month trek over the Andes to Lima and the Pacific coast. There, Spanish treasure fleets took the silver from Peru up to Panama, where it was carried by land over the isthmus and then across the Atlantic in convoys.
But this silver trade was not centred only on Europe – Spain also had an Asian empire, based in Manila in the Philippines, and pieces of eight were soon crossing the Pacific in huge numbers. In Manila, pieces of eight were exchanged, usually with Chinese merchants, for silks and spices, ivory, lacquer and, above all, porcelain. The arrival of Spanish-American silver destabilized the East Asian economies and caused financial chaos in Ming China. Indeed there was hardly any part of the world that remained unaffected by these ubiquitous coins.
In the coin collection of the British Museum there is a display that gives a wonderfully clear idea of the global role of pieces of eight made in the Spanish-American mints. One coin has been counter-stamped by a local sultan in Indonesia, while others were stamped by the Spanish themselves for use in their province of Brabant, now in modern Belgium. Other coins here have been inscribed with Chinese merchants’ stamps, and a coin from Potosí was found near Tobermory in the Hebridean islands off the west coast of Scotland; it comes from a ship that was once part of the Spanish Armada, wrecked in 1588. Pieces of eight even reached Australia in the nineteenth century. When the British authorities ran out of currency there, they bought Spanish pieces of eight, cut out the Spanish king’s face and re-engraved them to read five shillings, new south wales. The presence of these coins from the Hebrides to New South Wales shows that, both as a commodity and as a coin, pieces of eight engendered a fundamental shift in world commerce, as the financial historian William Bernstein describes:
&n
bsp; This was a godsend, this Peruvian and Mexican silver, and very quickly hundreds of millions and perhaps even billions of these coins got minted, and they became the global monetary system. They were the Visa and the MasterCard and the American Express of the sixteenth through to the nineteenth centuries. They are pervasive enough that when you, for example, read about the tea trade in the eighteenth and nineteenth centuries in China, which was a vast trade, you see prices accounted for in dollars, with dollar signs; and of course what they were talking about were Spanish dollars – these pieces of eight.
Across Europe, Spanish-American treasure inaugurated an age of silver, ‘the wealth which walketh about all the countries of Europe’.
But the very abundance of silver brought a new set of problems. It increased the money supply – much like governments printing money in modern terms. The consequence was inflation. In Spain there was bemusement, as the wealth of empire in both political and economic terms often seemed more apparent than real. Ironically, silver coin became a rarity within Spain itself, as it haemorrhaged out to pay for foreign goods while local economic activity declined.
When the British authorities in Australia wanted to create a local currency, they converted Spanish pieces of eight into five -shilling coins
As gold and silver vanished from Spain, its intellectuals grappled with the gulf between the illusion and the reality of wealth, and the moral consequences of the country’s unexpected economic troubles. One writer in 1600 describes it like this:
The cause of the ruin of Spain is that riches ride on the wind, and have always so ridden in the form of contract deeds, of bills of exchange, of silver and gold, instead of goods that bear fruit and which, because of their greater worth, attract to themselves riches from foreign parts, and so our inhabitants are ruined. We therefore see that the reason for the lack of gold and silver money in Spain is that there is too much of it and Spain is poor because she is rich.
More than four centuries later we are still struggling to understand world financial markets and to control inflation.
Potosí remains proverbial for its wealth. Spaniards today still say something is ‘vale un Potosí – ‘worth a fortune’ – and the Spanish piece of eight lives on as a romantic prop in fantasy pirate stories. But it was in fact one of the foundation stones of the modern world, underpinning the first world empire, both prefiguring and making possible the modern global economy.
PART SEVENTEEN
Tolerance and Intolerance
AD 1550–1700
The Protestant Reformation split the western Christian Church into two rival factions and triggered major religious wars. The failure of either side to achieve victory in the Thirty Years War would lead, through exhaustion, to a period of religious tolerance in Europe. Three great Islamic powers dominated Eurasia: the Ottomans in Turkey, the Mughals in India and the Safavids in Iran. The Mughals promoted religious tolerance, allowing the Indian subcontinent’s largely non-Islamic population to continue to worship as they pleased. In Iran the Safavids created the world’s first major Shi’a state. At the same time, conquest and trade redrew the religious map of the world, and both Catholicism in the Americas and Islam in south-east Asia sought to accommodate the existing rituals of their new converts.
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Shi’a Religious Parade Standard
Gilded brass parade standard, from Iran
AD 1650–1700
It comes as a surprise to most tourists visiting Isfahan, the capital of Shi’a Iran in the seventeenth century, to discover in that very Islamic city one of the world’s great Christian cathedrals, full of silver crucifixes and wall-paintings telling the narratives of biblical redemption. This cathedral was built in the first half of the seventeenth century by Shah Abbas I, the great ruler of early modern Iran, and provides a superb example of how the world map of religion was redrawn in the sixteenth and seventeenth centuries. The question at the centre of that redrawing was whether a state could hold more than one faith; the answer to it, in sixteenth-and seventeenth century Iran, was that it most certainly could. But the monotheistic faiths have always found it difficult to live together for long, and religious tolerance among them is usually both contested and fragile. In this chapter I will be exploring the situation in seventeenth-century Iran through an ‘alam – a lavishly gilded ceremonial brass standard. ‘Alams were originally battle standards, designed to be carried like flags into the fight, but in seventeenth-century Iran they were used in great religious processions and rallied not warriors but the faithful.
Shah Abbas was a member of the Safavid Dynasty, which came to power around 1500 and established Shi’a Islam as the state religion of Iran, a position it has held ever since. There is an interesting parallel with events in Tudor England, which became officially Protestant at about the same time as Iran became Shi’a. In both countries religion became a defining element of national identity, setting the nation apart from its hostile neighbours – Protestant England from Catholic Spain, Shi’a Iran from its Sunni neighbours, above all Turkey.
Shah Abbas, a contemporary of Elizabeth I of England, was a ruler of rare political nous and even rarer religious pragmatism. Like Elizabeth, he was keen to develop international trade and contact. He invited the world to visit his capital in Isfahan, welcoming Chinese envoys at the same time as hiring Englishmen as advisers; he expanded his borders and in the process captured Armenian Christians whom he brought back to Isfahan. There the Armenians developed the highly profitable trade in silks and textiles with the Middle East and Europe, and in return Shah Abbas built for them a Christian cathedral. Visiting Europeans were astonished by this active religious tolerance, with Christians and Jews, each with their own places of worship, peacefully accommodated within a Muslim state – a level of religious diversity unthinkable in Christian Europe at the time. Isfahan was of course a centre for Islamic scholarship and a place where architecture, painting and high craft in silks, ceramics and metalwork were all put to the service of the faith.
The names of the family of the Prophet are written above the central mihrab of the Mosque of Shaykh Lutfallah
This Shi’a Iran of the Safavid shahs, sophisticated and cosmopolitan, prosperous and devout, which lasted for more than 200 years, can still be seen in this ‘alam, made around 1700. It is approximately sword-shaped, with a disc between the blade and the handle, and is 127 centimetres (50 inches) high. It is made of gilded brass typical of the metalworking tradition that had evolved in Iran and especially in Isfahan, where merchants and craftsmen from India, the Near East and Europe met and traded.
But however cosmopolitan the style and skill, this ‘alam was made specifically for use in a Shi’a Muslim ceremony, mounted on a long pole and carried high in procession through the streets. The blade of the sword has been transformed into a filigree of words and patterns. The words are effectively a declaration of faith, and words like this are part of the physical fabric of Shi’a Isfahan.
The Mosque of Shaykh Lutfallah was built by Shah Abbas at the same time as he built the cathedral for the Christians. It is a monument to the word: the structural elements of the architecture are all marked out and decorated with inscriptions, the words of God, the words of the Prophet or other holy texts. In fact, the words appear to hold the building up. Over the mihrab, the central niche, which marks the direction of Mecca towards which the faithful should pray, are written the names of the Ahl al-Bayt, the family of the house – that is, the family of the Prophet. There are the names of the Prophet Muhammad himself, Fatima, the Prophet’s daughter, her husband Ali, and their sons Hassan and Husain.
Isfahan Cathedral, built in the first half of the seventeenth century by Shah Abbas I, combines Christian iconography with Islamic design
We find the same names on the ‘alam in the British Museum’s galleries. Ali is mentioned three times. For Shi’a Muslims, Ali was the first imam, or spiritual leader, of the faithful, and this kind of ‘alam is known as ‘The Sword of Ali’. Elsewhere on the ‘
alam are the names of the ten other Shi’a imams – all descended from Ali and all, like him, martyred. As this ‘alam was carried through the streets the faithful would see the names of the Prophet, of Fatima, of Ali and of all the other imams.
Shi’ites hold that the office of imam – infallible religious guide – belongs to the house of Muhammad alone and so to the descendants of Ali, the Prophet’s son-in-law. By contrast, the majority of Sunni Muslims accepted the authority of the caliph, originally an elected office. In the decades after the Prophet’s death, these differing views led to bloody conflict, during which Ali and his sons were all killed – the beginning of a tradition of martyred Shi’a imams.
The Shi’ism of the Safavids was Ithna ‘Ashari, or Twelver Shi’ism, which holds that there are twelve imams, of whom eleven died as martyrs and are named on the ‘alam itself. The Twelfth Imam is said to have vanished in 873 and to be in hiding, awaited by the faithful and to be restored by God when it pleases him, at which point Shi’a dominion will be established on earth. Until then, the Safavid shahs, who also claimed descent from the Prophet, were the temporary proxy for the hidden imam. Authority in religious matters, however, lay not with the shah, but with the ulema – the body of Islamic scholars and jurists responsible for interpreting Islamic law, as indeed they still are today.
A History of the World in 100 Objects Page 45