Abstract
The concept of the Fiscal-Military State was coined by John Brewer in 1989 to encapsulate the relationship between a state’s tax-raising capacity and its ability to project military and naval power. Brewer’s analysis contrasted Britain’s success in funding war through efficient revenue collection and credit arrangements, with continental European monarchies’ reliance on more coercive methods such as conscription and forced loans. Brewer’s arguments sparked considerable debate which broadened when Roger Knight and Martin Wilcox introduced the term ‘contractor state’ in 2010 and shifted attention towards how governments’ military demands were met by private entrepreneurs. These discussions intersected with longer running arguments in Spanish history about that country’s rise and fall as a great power. In an influential study published in 1976, I. A. A. Thompson argued that Spain switched from a system of administración during the sixteenth century, whereby the state produced or procured its requirements directly, to reliance in the seventeenth century on asientos, or contracting involving the open market. These arguments aligned with well-established interpretations of Spain’s rise as a European power during the sixteenth century, followed by sharp decline in the seventeenth century, before a partial recovery after reforms initiated by the Bourbons who replaced the Habsburgs as monarchs in 1700. Thompson’s arguments also rested more fundamentally on how nineteenth and twentieth century scholarship defined the modern state as a single monopoly of legitimate power underpinned by a coherent institutional infrastructure and commanding loyalty from a uniform body of subjects.
Rafael Torres Sánchez offers an important challenge to these established views. He is, of course, scarcely alone in doing so, but his book nonetheless deserves attention because of the way it moves the debates further forward. He rejects Thompson’s dichotomy between administration and contracting, as well as his belief that contractors primarily pursued ‘private’ profit inherently at odds with ‘public’ interests. Contemporaries indeed distinguished between state provision and market supply, but actual policy blurred the boundaries between them. This is illustrated by detailed investigation of army victualling and naval shipbuilding, as well as additional material on the procurement of other key war-making resources, including manpower, uniforms, hemp and anchors. Army victualling was the most pressing and expensive need the Spanish government had to meet in sustaining its military potential. Spain largely relied on contractors throughout the eighteenth century, though made several attempts to assert direct control, notably during the 1730s when the intendentes assumed the role of provision managers charged with purchasing and distributing food to the troops, while the army treasurers managed the accounts. Further efforts followed in the 1750s, 1760s and 1790s, but each was abandoned after reforms failed to produce the promised cost savings or improve efficiency. The state was more interventionist in naval procurement, especially shipbuilding and the supply of hemp and wood, but nonetheless still relied heavily on contractors. Spain’s physical geography added to the state’s difficulties. The bulk of war materials were produced in northern Spain, but consumed in the south, especially where part of the fleet was stationed. Maritime transport was almost entirely handled by private contractors, even in wartime when this was at risk to enemy intervention, because the configuration of mountains and rivers made overland transportation very difficult.
An important finding is that there was no inexorable trend towards administration replacing contracting. Instead, contingency as much as ideological argument determined the numerous switches between the two forms, the respective merits of which contemporaries continued to argue over across the century. A key problem was that neither the state nor contractors had a clear idea of the market value of war-making resources. The government knew what it paid to procure what it needed, but did not know the true cost, because many administrative charges and overheads were not recorded in its accounts. It remained hard to judge whether administration was actually cheaper than contracting. Similarly, entrepreneurs were often accused to profit taking, but their critics were hard pressed to document this. Prices were negotiated without a clear idea of fluctuating market conditions. The state tried to manage expenditure by relying on its institutional memory of what it had paid before, but its chronic liquidity problems frequently forced it to agree cash advances against final actual costs.
A second important conclusion is that procurement decisions ultimately remained political. Despite its difficulties, the Spanish government enjoyed an asymmetrical relationship with its contractors. Its overriding concern was to ensure its military and naval supply needs were met, with how this was achieved remaining a secondary consideration. For example, the government alone set the technical specifications for cannon, thus reducing the significance in whether these were produced in its own factory or purchased from private foundries. Debates over the best form of supply were indeed ideological, but theoretical distinctions mattered much less in practice, because of the way administration and contracting could overlap. The open market was always viewed as too risky by a government determined to ensure unbroken supply. Driven by its desire to ensure reliability, the government favoured contractors known to be solvent and capable of acting with discretion and reserve. It offered them legal as well as commercial privileges, especially in lieu of its inability to pay them promptly. Contractors also saw reasons to cooperate which went beyond the purely material. They looked to the state to shield them from foreign competitors, and so shared much of the government’s mercantilist agenda. Interdependence between state and contractors grew in the second half of the eighteenth century as the government relied heavily on a small number of favoured suppliers tied to it through exclusive, monopolistic arrangements. Contractors assumed positions not too dissimilar from that of direct state employees, while both they and the state collaborated to shield themselves from market forces. Spain remained locked in the shifting cycle of administration and contracting, because the differences between the two were insufficient for either system to be clearly superior to the other. Favouring indigenous suppliers did help the integration of a national economy and generally met the government’s military and naval needs, but Torres Sánchez concludes that ‘the Spanish nation as a whole [remained] weaker and less developed than it might have been’ (p. 230).