Just wars of accumulation: the Salamanca School,race and colonial capitalism

The new economics of the Price Revolution

Throughout the Middle Ages, significant restrictions existed on setting prices, wages and rents. In the medieval world, ownership of things and labour retained an element of community concern whereby the individual owner was under obligations to use and sell property not only to his own benefit, but to the benefit of the community and state as a whole. This conception became formalised under Aquinas as ‘just price’ theory, wherein the market was conceived as a mechanism of distributive justice; as a way to distribute and redistribute goods grounded in principles of community accountability, fairness and equity. Aquinas condemned usury and argued that contracts were only valid insofar as they fairly benefited both parties. Aquinas was particularly concerned with exchanges in which a buyer who faced dire circumstances would agree to pay a significantly higher price than the just value of a commodity: ‘If someone would be greatly helped by something belonging to someone else, and the seller not similarly harmed by losing it, the seller must not sell for a higher price: because the usefulness that goes to the buyer comes not from the seller, but from the buyer’s needy condition: no one ought to sell something that doesn’t belong to him.’ ⁷ Likewise, the juridical principle of laesio enormis, or abnormal harm, allowed contracts to be rescinded if the agreed-upon price was significantly below the normal value. In the medieval world, it was more important to ensure that exchange was conducted under fair conditions than to affirm the inviolable conditions of contract. As Michel Foucault explains medieval economic theory, these policies and their insistence on some element of distributive justice in the realm of exchange meant that

the market was a site invested with regulations. It was also a site of justice in the sense that the sale price fixed in the market was seen, both by theorists and in practice, as a just price, or at any rate a price that should be the just price, that is to say, a price that was to have a certain relationship with work performed, with the needs of the merchants, and, of course, with the consumers’ needs and possibilities. The market was a site of justice to such an extent that it had to be a privileged site of distributive justice. ⁸

Hence, for hundreds of years preceding the rise of the Salamanca School, ‘the market was, essentially, and really functioned as, a site of justice … The market was a site of jurisdiction.’ ⁹

In this way, merchants were seen to have an obligation to the community to charge a price that would not violate this principle:

The just price was a price which would neither ‘disgust’ merchants nor ‘wound’ consumers. It was predicated upon an ideal of moderation which tended to vary with the circumstances. A price was thought just when merchants settled for a moderate profit and the bulk of the people, who lived in a chronic state of misery did not suffer immoderately, that is to say, more than they did usually. ¹⁰

With the Price Revolution, the previous stability of the market that allowed just price theory to function reliably in practice was eliminated. Moreover, merchants saw great opportunities to generate enormous profits in short periods of time on an unprecedented scale. With an increasingly volatile market, rapid inflation and seductive possibilities for profit, just price theory was called into question by many in Europe, but especially those in the School of Salamanca. Both Diego de Covarrubias y Leiva (1512–1577) and Francisco García (?–1659) developed sophisticated accounts of supply and demand that directly contradicted the prevailing ‘just price’ theory. ¹¹ Domingo de Soto (1494–1560) and Luis de Molina (1535–1600) both published extensive arguments against Duns Scotus’ version of just price theory, which argued that a fair price for goods is determined by the cost of production plus a small, reasonable profit. They argued, rather, that price is and should be determined by supply and demand in the market – some of the first well-reputed scholars to articulate the supply-and-demand principle that undergirds modern economic theory. Molina in particular argued that competition and scarcity are the principles by which supply and demand function, that competition among consumers inflates prices and that scarcity of buyers drives prices down.

Martín de Azpilcueta (1493–1586), often called Doctor Novarrus, extended this analysis to specie and money itself, arguing that ‘money is worth more where it is scarce than where it is abundant’. ¹² Concerned specifically with the massive influx of precious metals from the American mines, Azpilcueta laid the foundations for the quantitative theory of money ¹³ that would be later developed more extensively by the French philosopher of law and sovereignty Jean Bodin. ¹⁴ Covarrubias and Molina both elaborated a subjective, buyer-centric theory of value that held that different commodities would hold differing levels of value for each consumer depending on their particular inclinations, desires and needs. Prices should then be decided in the free market, between buyer and seller, without price controls, in order to determine the true price of the commodity. On this, Luis Saravia de la Calle wrote in 1544:

Those who measure the just price by the labour, costs, and risk incurred by the person who deals in the merchandise or produces it, or by the cost of transport or the expense of traveling … or by what he has to pay the factors for their industry, risk, and labour, are greatly in error … For the just price arises from the abundance or scarcity of goods, merchants, and money … and not from costs, labour, and risk … Why should a bale of linen brought overland from Brittany at great expense be worth more than one which is transported cheaply by sea? … Why should a book written out by hand be worth more than one which is printed? ¹⁵

With the Salamanca School, we see not only economics decoupled from principles of justice, but also price untethered from costs of production. While this is interesting on many accounts, for our purposes, it is particularly important that the divergence between price and production cost meant that merchants could increase their rate of profit at unprecedented levels. When it was acceptable for profit to amount to only a small margin over production costs, employers had little incentive to press down the wages of their employees; pocketing the difference in profit from depressed wages would have contravened this principle. However, when price becomes uncoupled from the costs of production and nearly infinite profit becomes socially and philosophically acceptable, an employer has every incentive to increase the rate of surplus value extraction by reducing the wages of employees and increasing their productivity. Of unprecedented importance, therefore, for the history of the development of capitalism is the rejection of just price theory. The newly emergent market theory of price not only justified higher returns by ‘selling dear’ even under conditions of buyer duress, but also opened the space for the development of new techniques of labour devaluation and increased efficiency that would only continue to become more sophisticated as the centuries progressed, leaving an indelible, if frequently forgotten, mark on the history of political economy. ¹⁶ It is due to the arguments offered by the Salamanca School that by ‘the middle of the eighteenth century, the market no longer appeared as, or rather no longer had to be, a site of jurisdiction’ ¹⁷ or of distributive justice.

The rejection of just price theory also entailed the loosening of restrictions on the accumulation of capital and profit in the form of interest. Various justifications were given for lifting the medieval prejudice against accruing monetary interest on loans. Some argued that when money was borrowed to underwrite production rather than consumption, the prohibition on charging high rates of interest did not apply. They argued also that interest compensated the lender for forgoing other possibilities of using that money (what we would now call ‘opportunity cost’). Martín de Azpilcueta argued that interest compensates the individual lender for the time that he would be deprived of the money. While some of these arguments were offered by theorists as early as the Middle Ages, they only received widespread attention with the rise of the power and influence of the Salamancans. But what was particularly new for the Salamancans was the conceptualisation of money itself as a commodity and that, as such, individuals should receive recompense for its ‘productive use’. ¹⁸

Colonisation and the commutative justice of the market

The shift from a distributive to commutative theory of economic justice can only be adequately understood in the context of the other concerns of the Salamanca School: sovereignty, subjectivity, political authority and imperial expansion. Much of Spanish philosophy focused on problems generated by the newly global world order. Given the new relations with the western hemisphere, many longstanding philosophical problems and discussions gained a new international dimension under the Salamanca scholars. Chief among these were considerations of political legitimacy and natural law. As we will see, these concepts, for the School of Salamanca, were not only elaborated in response to the new discourses and practices of colonisation, but intertwined discussions of economics in questions of politics in new ways. Hence, innovations in political theory and natural rights were based in the economics of colonial exploitation and imperial expansion in ways that would continue to frame the discourse of political economy throughout the early modern period.

Perhaps the most famous political philosopher of the Salamanca School, Francisco de Vitoria is a paradigmatic example of the kind of emergent politics grounded in colonial capitalism. In many senses, Vitoria is frequently considered to be a ‘progressive’ philosopher of the Conquest. He argued against many of the overtly racist justifications for the Conquest, rejected the claims of Church and Imperial Crown to ownership of the colonies, and defended both the humanity and property rights of the indigenous peoples of the Americas. However, certain other aspects of Vitoria’s thought, and specifically his analysis of the economy, provide the foundation for the expropriation of Amerindian labour, perhaps despite his own intentions. In what follows, I read the economic consequences of Vitoria’s philosophy in ways that often seem at odds with his stated goals. I use Vitoria as an exemplar of the ways in which European philosophies that ground relations between states and peoples in economic terms frequently – intentionally or not – end up justifying domination and economic exploitation. In particular, much of the language of universality, natural rights and human nature that is supposedly predicated of all contains within it a distinctly European perspective, replete with justifications of European interests in maintaining relationships of labour, trade and commerce with non-European peoples on political, economic and philosophical terms that do not treat non-Europeans or their interests on equal grounds with Europeans, even when they purport to. Looking carefully at these unintended or subterranean aspects of Vitoria’s philosophy will allow us to see how, in later political economy that builds on his theories, many universalist principles that proclaim natural rights and equality were often employed in the service of exploitation. Moreover, excavating the European bias of Vitoria’s writings will allow us to see the colonial stain that accompanies many of his concepts as they are taken up by later philosophers.

Vitoria, the first to question the legitimacy of Pope Alexander VI’s Bulls of Donation to Spain and Portugal, rejected the most common claims to legitimacy for Spanish rule in the colonies. He rejected the authority of both Emperor and Pope in the Americas as well as the argument that domination of indigenous peoples was justified in order to convert them to Christianity:

Now, in point of human law, it is manifest that the Emperor is not lord of the world, because either this would be by the sole authority of some law, and there is none such; or if there were, it would be void of effect, inasmuch as law presupposes jurisdiction. If, then, the Emperor had no jurisdiction over the world before the law, the law could not bind someone who was not previously subject to it. ¹⁹

Vitoria’s rejection of the authority of Church and Crown over the Americas radically shifted the terms of the colonial debate, for Vitoria did not advocate the withdrawal of European powers from the Americas; rather he argued for European imperialism on completely secular terms. As Antony Anghie puts it:

In the course of refuting the conventional basis for Spanish title [Vitoria ] creates a new system of international law which essentially displaces divine law and its administrator, the Pope, and replaces it with natural law administered by a secular sovereign. Thus, the emergence of a secular natural law – the natural law which was proclaimed to be the basis of the new international law – is coeval with his resolution of the problem of the legal status of the Indian, for it is this problem which initiates Vitoria’s inquiry. ²⁰

In order to ground this secular imperialism, Vitoria still needed to confront the question of how Europeans could reasonably hold any title in the land of the Americas. Vitoria argued that Native Americans were, like Europeans, free people who held property rights in their lands and, hence, neither the people nor the land of the Americas could be legitimately ruled, dominated or occupied by European powers. ²¹ That Amerindians were not Christian, one of the most frequent justifications for European colonisation, was likewise disqualified as a legitimate rationale: ‘Unbelief does not destroy either natural law or human law; but ownership and dominion are based either on natural law or human law; therefore they are not destroyed by want of faith.’ ²² Nor could indigenous peoples be denied their rights for lacking reason; Vitoria, unlike many contemporaries argues that indigenous peoples clearly display the signs of reason:

the true state of the case is that they are not of unsound mind, but have, according to their kind, the use of reason. This is clear, because there is a certain method in their affairs, for they have polities which are orderly arranged and they have definite marriage and magistrates, overlords, laws and workshops, and a system of exchange, all of which call for the use of reason; they also have a kind of religion. Further, they make no error in matters which are self-evident to others; this is witness to their use of reason. ²³

Hence, indigenous peoples cannot be denied their property claims to their land on the basis of heresy. What is remarkable about this account is that it will turn out to provide a secular basis for the denial of property rights to indigenous people. What seems like an overturning of a colonial argument turns out to be merely a justification grounded in economic, rather than religious, anthropological, or jurisdictional terms.

Vitoria begins his analysis of the colonial situation by discussing natural right as the ground of international law. Vitoria expounded a concept of the ius gentium (the rights of peoples), and is by some accounts, the first to give a systematic analysis of its genesis and political consequences. Vitoria, in particular, extrapolated this concept to international law, arguing, against Grotius, that the foundation of interstate relations must be the common good of the world, oriented towards protecting the natural rights of all. For this reason, relations between sovereign peoples could not be founded on force, but must rather be grounded in a concept of justice and law.

As in many early modern theories, for Vitoria, the correlate of jus gentium was the elaboration of conditions under which war could be legitimately declared. Given the requirement that international relations be founded on justice, Vitoria sought to specify the conditions under which armed conflict could be considered ‘just’. Vitoria defended ‘just war’ theory on a variety of grounds ²⁴ but what is important here is the way in which the ius gentium is linked to a particular concept of exchange, commerce and economy. Vitoria’s universal humanism led to the elaboration not only of the ius gentium as a political right of all, but also the ius peregrinandi et degendi as its economic correlate. This principle held that all people hold a fundamental right to commerce and travel across the globe as some of the specific natural rights predicated of every human being. This meant that Europeans had, under the ius peregrinandi et degendi, the right not only to travel to the Americas, but to live there, set up businesses there, enter into employment contracts there, and make profits there. A consequence of the ius peregrinandi et degendi meant that, if the indigenous peoples of the Americas refused passage, travel or business with Europeans, the latter could ‘defend themselves’ in a just war to remain in the land and continue to engage in commercial activity, for, ‘to keep certain people out of the city or province as being enemies, or to expel them when already there, are acts of war’. ²⁵ This position became a mainstay of Spanish theory as elaborated by many others, including Suárez who argued ‘it has been established by the ius gentium that commercial intercourse shall be free, and it would be a violation of that system of law if such intercourse were prohibited without reasonable cause’. ²⁶

Let us be clear about what this passage means in its historical context. In 1532, when Vitoria’s Of Indians and the Laws of War (De Indis et de Ivre Belli Relectiones) was published, the Spanish mining industry had already been established in multiple places in Latin America and ‘due to the factors of disease, cave-ins, accidents, and suffocation … exposure to toxic gasses and metal vapors the mines consumed [indigenous] men in tremendous quantities’. ²⁷ Ports had been established, estates created, hundreds of thousands of indigenous people slaughtered, and the system of encomienda tribute labour (established in 1501) was already entrenched. The encomienda system broke up families, destroyed the traditional system of communal farming, and pressed indigenous people and their descendants into de facto slavery. Two hundred and fifty thousand Aztecs had been slaughtered in Cortés’ conquest of Tenochtitlan. The dreaded European smallpox reached the Andes in 1521 and, for every single individual indigenous person who survived it, fifty-eight died an agonising death. So, when Vitoria writes that indigenous peoples are not entitled to keep Europeans out of their cities, cannot take back property considered ‘European’, and cannot expel colonial forces or administrators, Vitoria is criminalising indigenous resistance to the economic exploitation and morbid regime of death and decay that Europeans brought with them.

All of this is not particularly interesting; many European theorists sought to legitimise the suffering of Amerindians; what is interesting, however, is the philosophical strategy that Vitoria deploys. It is quite banal to take, for example, the strategy of Sepulveda, who argues that because Amerindians aren’t really human, they are obliged to accept colonisation, exploitation, forced conversion, and whatever other inhuman practices the Spanish could conceive. Vitoria, on the other hand, takes a very different strategy, and one that, I think, is much more insidious. The reason that indigenous peoples cannot justly expel Europeans – no matter the destruction they have wrought – is precisely because they are conceived as full humans on an ‘equal’ plane with Europeans. The inclusion of indigenous peoples in the universal brotherhood of humanity had the effect of binding them to a putatively equal and universal system, even if it had vastly unequal effects: ‘it is precisely because the Indians possess reason that they are bound by jus gentium’ ²⁸ and by the ius peregrinandi et degendi. In other words, precisely because Amerindians are rational humans, they are bound by the laws of nature to accept the Spanish colonial presence.

Looking further at Vitoria’s argument, we can see the devastating consequences that this application of ‘natural law’ will have on indigenous peoples. Once indigenous peoples have violated this ‘law of nature’, and a ‘just war’ has been declared in order to force travel, occupation and commerce, this war is, according to Vitoria, perpetual: ‘and this is especially the case against the unbeliever, from whom it is useless ever to hope for a just peace on any terms. And as the only remedy is to destroy all of them who can bear arms against us, provided they have already been in fault.’ ²⁹ Even though, as we have seen above, non-believers are not denied their natural right to property, Vitoria uses the universalism of the ius gentium to bring indigenous peoples under the ius peregrinandi et degendi that requires they engage in commerce with Europeans, no matter how unequal the conditions of that commerce may be. Once Europeans have established homes and trade-posts, indigenous resistance is deemed to contravene the law of nature and invoke a perpetual war in which genocide is justified. Moreover, it is worthy of note that only Christians are in the position to declare a just war; it would not be just for indigenous people to rebel against their colonial oppressors. ³⁰ In this way:

jus gentium naturalizes and legitimates a system of commerce and Spanish penetration. Spanish forms of economic and political life are all-encompassing because ostensibly supported by doctrines prescribed by Vitoria’s system of universal law. The gap between the two cultures now ceases to exist in that a common framework by which both Spanish and Indian behaviour may be assessed is established. Equally importantly, an idealised version of the particular cultural practices of the Spanish assumes the guise of universality as a result of appearing to derive from the sphere of natural law. ³¹

What is important here is that political freedom for Vitoria is intimately connected to a universal concept of human nature that requires the freedom of (capitalist) commerce. Koskenniemi suggests that the legacy of the Salamanca School was the development of a particularly imperial and early modern conception of dominium (absolute ownership and control over property), ³² ius gentium and just war. ³³ As Fitzmaurice argues, it is precisely these three ideas ‘that justified the emergence of centralized states, a global economic system based upon private property, and continual warfare to uphold the principles of that system’. ³⁴

The language with which Vitoria defends the principles of emerging capitalist society is vitally important; for Vitoria, the war to open ‘free’ travel and trade constituted a war of ‘defense of the common good’ and ‘self-defense’. ³⁵ In the first place, the characterisation of the Spanish position as defensive frames all Amerindian resistance to encroaching capitalist commerce as offensive, as violent. Second, it identifies the ‘common good’ and the good of ‘selves’ with the interests and persons of the Spanish. What initially appears as the elaboration of a universal law, predicated equally of Europeans and Amerindians, turns out to define the self and the good in white, European, colonial terms. As a philosophical and political-economic invention, this latter constituted a veritable revolution. It became possible to speak at once in putatively universal terms while meaning something particular; while meaning some people in particular. Unsurprisingly, what was predicated universally of human nature were Spanish interests in the Americas so that those whose interests were different, a fortiori those whose interests involved rejecting and resisting Spanish imperial conquest, were deemed to be lacking or contravening laws of human nature. In Anghie’s summation:

Vitoria develops a number of concepts and relationships – regarding divine and natural law, sovereignty and culture, particularism and universalism – which are then constituted into a jurisprudence which executes a formidable series of manoeuvres by which an idealised form of particular Spanish practices become universally binding, Indians are excluded from the realm of sovereignty, and Indian resistance to Spanish incursions becomes aggression which justifies the waging of a limitless war by a sovereign Spain against non-sovereign Indians. The colonial encounter is central to the formulation of Vitoria’s jurisprudence whose significance extends to our own times. ³⁶

While Vitoria explicitly argues that the mere expansion of empire is not a just cause for war in and of itself, ³⁷ he does nonetheless construct a system of natural law that forces indigenous peoples to submit to the expansion of European colonial capitalism or to be slaughtered. Only, unlike other proponents of empire, slavery and racism, Vitoria proffers this system with a thin patina of justice and equality. One of the enduring political innovations of the Salamanca theorists was thus the articulation of central facets of capitalist political economy – the elaboration of discourses of freedom, equality and justice that bring only servitude, domination and alienation. This discursive strategy, characteristic of liberal political theory in general, was born in the colonial situation: ‘The fact remains that the natural law arguments of trade and friendship and occupation were used by Europeans to dispossess indigenous Americans and other indigenous peoples. These arguments, while for Vitoria prohibiting invasion, provided a tool that could be and was turned against colonised peoples.’ ³⁸

Vitoria’s right of commerce and communication, trade and travel, itself laid the foundations for new philosophical thinking about subjectivity:

It was clear, however, that the right to communication and commerce was not a right of property, far less of sovereignty … Indeed, the argument of commerce implicitly assumed that rights reside in the persons with whom one is trading. The English insisted on the right to commerce with the Indians by using precisely the same arguments that they had used to insist on free trade (when they chose to insist on free trade) with other European nations, particularly the Spanish and the Dutch and their dependencies. ³⁹

By turning commerce, an activity, into a right, Vitoria, quite unwittingly, installed a colonial desire into the heart of western political economy: for the first time, the right of commerce was predicated of a person qua personhood, a theme that pervades later political economy, so much so that Foucault has argued that political economy is based on the concept of homo oeconomicus, economic man. It suffices to say for now that, insofar as the right of commerce became integrated into the concept of personhood, Vitoria’s justification of war and conquest amounted to a secularisation and universalisation of the legitimacy of conquest. In this way, ‘Francisco de Vitoria was the first articulator of a European discourse of conquest founded on secularly rationalisable norms and values. His Law of Nations justified the extension of Western power over the American Indians as an imperative of the Europeans’ vision of truth.’ ⁴⁰

The case of Vitoria, one of the central architects not only of Salamancan political economy, but also of secular discourses of law and sovereignty, points to the centrality of the colonial context in evaluating western political, economic and philosophical ideas. Indeed, ‘Vitoria’s jurisprudence is constructed around his attempts to resolve the unique legal problems arising from the discovery of the Indians … Traditional approaches essentially characterize Vitoria as extending and applying existing juridical doctrines developed in Europe to determine the legal status of the Indians’, ⁴¹ rather than recognising that these doctrines and ideas, far from pre-dating the Spanish Conquest, were developed in and through the philosophical and economic problems posed through the Conquest itself. Anghie continues: ‘The essential point is that international law, such as it existed in Vitoria’s time, did not precede and thereby effortlessly resolve the problem of Spanish-Indian relations; rather, international law was created out of the unique issues generated by the encounter between the Spanish and the Indians.’ ⁴² The colonial situation is hence at the heart of the development of the jurisprudential discussions of sovereignty, legality, commerce, war and justice as its fundamental premise. For this reason, Koskenniemi argues that the most important Spanish contribution to early modern political thought was the elaboration of the interrelation between property, human nature and imperial war, a nexus constructed for the first time by Vitoria. The legacy of this conjuncture can only be adequately conceptualised in its historical context alongside

three further transformations that took place in the period: the formation of centralized political communities – states – that demanded absolute loyalty from their citizens; the emergence of a global economic system based on private ownership and the search for profit; and continuous warfare, not only against the infidel, but among Christian rulers themselves. The notions of dominium, ius gentium, and the bellum iustum were now deployed to give a legal and moral articulation to the transformations of early modernity that … continues to give a distinctly imperial structure to the most significant global laws and practices of the present age. ⁴³

In this way, many of the fundamental ideas of political economy are generated out of the very specific colonial relationship and elaborated precisely to justify imperial conquest in a secular, property-oriented manner, rather than in the previous religious and jurisdictional terms. Hence, ius gentium, developed to lend a secular and humanistic basis to the continued imperial conquest of the Americas, returned like a boomerang to Europe, becoming a foundational principle for conduct inside Europe itself; the naturalisation of capitalism begins here, in a colonial discourse.

Vitoria, the Price Revolution, and the foundations of later political economy

Beginning with Vitoria, the Salamanca political economists introduced a series of ideas into economic and moral philosophy that continued to frame philosophical discourse and interrogation for centuries after. There are three elements of later political-economic theory that are specifically innovated by the Spanish political economists: the idea that economic decisions are best conceptualised at the individual rather than the collective level; that economic freedom forms a fundamental and ineradicable element of natural human freedom; and that humanism of a certain kind can be used as a tool of dispossession.

As we have seen with the discussions of just price, the Salamanca scholars prioritised the returns on individual investment over the principles of a distributive justice that would be adjudicated on a community level. Hence, what follows is not only that economic considerations are relocated from a distributive to a commutative level, but also that the chief concern is whether individuals, not communities, are treated justly for their investment and risk: ‘The important thing about the sixteenth-century Spanish theologians and lawyers was that they did frame those issues in terms of the individual.’ ⁴⁴ The central issue, however, is less that the individual is the chief unit of concern or analysis, but the integration of economic concerns into the very principles of human nature. When Vitoria postulates the ius peregrinandi et degendi as a central facet of natural law that all individuals are bound to follow, and when later Spanish Salamanca theorists use this to ground the rights of merchants to accumulate capital with limited state intervention, we see the development of an idea of ‘economic freedom’ that was wholly and completely new. In the work of later political economists, the idea of ‘economic freedom’ is not only indispensable, but will swiftly come to be considered the most fundamental aspect of human nature; in fact, in some accounts, economic freedom will become the very definition of human nature. In this way, ‘the theory of dominium as the sphere of freedom – especially, economic freedom – belonging to human beings by ius gentium now opened a wholly new way of speaking of universal authority beyond dubious claims about papal or imperial power. Any statement under the via antiqua that laid out duties connected with an office or rule could now be redescribed as a statement about what (some) human beings had an entitlement to.’ ⁴⁵

Postulating economic freedom as central to individual liberty had the effect of relatively de-emphasising the importance of the community in discussions of economic life. But it also, importantly, laid the foundations for asserting the rights of individual capitalists against state intervention and state power. Hence, when many of the Salamanca theorists begin to erode the foundations for imperial and church power in the Americas, displacing these realms of jurisdictional authority onto rights of commerce, we see, for the first time, economic liberty invoked against a public and institutional power. This argument will later develop into a full-blown theory of negative freedom in which public, state and collective institutions are seen as abusers rather than protectors of liberty and the conditions of freedom. The Salamanca School thus

established a universal field of economic liberty that could be invoked against all holders of public power. Wherever authority was being exercised, it could now be assessed in light of universal rights of property, self-defence, travel, trade, taking of possession of ownerless things, and so on. This was an inevitable consequence of the fact that Vitoria and Soto dealt with dominium in the context of commutative and not distributive justice; that is, relationships among subjects themselves, excluding ideas about the intervention of public power. ⁴⁶

Lastly, and perhaps most importantly, it is with the Spanish theorists that calls for liberty and equality take on the character of justifying conditions of exclusion and domination. While many of these thinkers elaborated systems of natural rights theoretically predicated of all individuals equally, and while nearly all of them remained critical of Spanish imperial practice in the Americas, they nonetheless used their putative inclusion of Amerindians as equal, rational humans to provide a rational and secular basis for their domination and dispossession. We can see with the Spanish the emergence of a proto-right populism, in which principles of equality serve as the cover for a capitalist accumulation predicated on inequality. Hence, what is distinctive about the Salamanca School, and radically innovative, is not only the linkage between commerce and freedom, but also the mobilisation of a seemingly egalitarian discourse to justify systems of dispossession. In Koskenniemi’s estimation:

In terms of the study of imperial relationships, the Spaniards appear distinctly as advocates less of ‘formal empire’ by advocating or supporting territorial annexations than of ‘informal empire’, the control of resources through the exercise of private-law relationships of contract and property. Their significance is not limited to advocating imperial domination through the use of formal state power – a strategy that Europeans have resorted to only occasionally and, more often than not, with dire results for themselves. Instead, they appear as early articulators of the much more powerful and long-standing type of informal imperial domination that is achieved through a worldwide pattern of acquisition and exchange of private property by which – as the rulers of Castile would themselves learn quite rapidly – formal state policies are also controlled, enabled, or undermined, as befits the global market. ⁴⁷

This newly complicated relationship between market and state would continue to haunt the discourse of political economy for centuries. What is important to recognise in the Salamanca School is both its thinkers’ centrality to the foundations of later political economy, but also the centrality of a newly emerging colonial capitalism to their philosophies of state, nature, politics and individuals. The colonial situation is no footnote to the development of political economy, but rather its central concern. As later became clear, when mercantile, physiocratic and classical economic theories inherited the problems, questions and solutions to both politics and economics from the Salamancans, they inherited also the multi-layered justification of colonisation that underpinned the Salamancans’ philosophies. I’d like to close by revisiting something Marx wrote: ‘The discovery of gold and silver in America, the extirpation, enslavement and entombment in mines of the aboriginal population, the beginning of the conquest and looting of the East Indies, the turning of Africa into a ward for the commercial hunting of black-skins, signalized the rosy dawn of the era of capitalist production.’ ⁴⁸ In looking at the philosophies of the Salamanca School, we can conclude, both with and beyond Marx, that the discovery of gold and silver in America not only marked the historical dawn of capitalism, but also the beginning of the discourses of political economy that would be used to justify it.