CHAPTER 17CHAPTER 17CAPITALISM & CAPITALISM & ABSOLUTISMABSOLUTISM

Expanding capitalismExpanding capitalism

Louis XIV, France “Sun King”Louis XIV, France “Sun King”

Charles I, EnglandCharles I, England

CAPITALISM EXPANDSCAPITALISM EXPANDS17-1817-18THTH CENTURY CENTURY

NEW MARKETS AND RESOURCESNEW MARKETS AND RESOURCES• INCREASED VOLUME OF TRADE WITH FOREIGN INCREASED VOLUME OF TRADE WITH FOREIGN

TERRITORIES GAINED IN EXPLORATIONTERRITORIES GAINED IN EXPLORATION• ACCESS TO RESOURCES OF NEW TERRITORIEACCESS TO RESOURCES OF NEW TERRITORIE• BANKING BECAME PUBLIC, NOT PRIVATE BANKING BECAME PUBLIC, NOT PRIVATE

FAMILY-OWNED ENTERPRISEFAMILY-OWNED ENTERPRISE• DEMAND FOR GOODS: DEMAND FOR GOODS:

GROWING POPULATIONGROWING POPULATIONSTANDING ARMIESSTANDING ARMIESPLANTATION AGRICULTUREPLANTATION AGRICULTURESLAVE TRADE.SLAVE TRADE.

JOINT STOCK COMPANIESJOINT STOCK COMPANIES BUSINESS IN WHICH BUSINESS IN WHICH

OWNERSHIP IS OWNERSHIP IS DIVIDED AMONG DIVIDED AMONG SEVERAL STOCK SEVERAL STOCK HOLDERS WHO HOLDERS WHO JOINTLY SHARE JOINTLY SHARE PROFITS & RISKS.PROFITS & RISKS.

EMERGED IN EMERGED IN RESPONSE TO RAPID RESPONSE TO RAPID GROWTH OF GROWTH OF PRODUCTION IN PRODUCTION IN TEXTILES, IRON, COAL, TEXTILES, IRON, COAL, SHIPBUILDING.SHIPBUILDING.

STOCK EXCHANGESSTOCK EXCHANGES

STOCK = STOCK = CERTIFICATE CERTIFICATE REPRESENTING REPRESENTING OWERNSHIP OF A OWERNSHIP OF A PART OF A PART OF A COMPANYCOMPANY

PLACES WHERE PLACES WHERE STOCKS WERE STOCKS WERE BROUGHT AND BROUGHT AND SOLD.SOLD. Amsterdam Stock Exchange

ABSOLUTISMABSOLUTISM

Political system in which the rule has total Political system in which the rule has total power with no limitations.power with no limitations.

Theoretical arguments for absolute rulers:Theoretical arguments for absolute rulers:• Divine right claimed that rulers were agents of Divine right claimed that rulers were agents of

God’s will. (Bishop Bossuet)God’s will. (Bishop Bossuet)• People created government to protect People created government to protect

themselves against themselves; they themselves against themselves; they surrendered their freedom to the state & had surrendered their freedom to the state & had no rights except obedience . (T. Hobbes)no rights except obedience . (T. Hobbes)

LOUIS XIV, 1638-1715LOUIS XIV, 1638-1715“L’etat c’est moi”“L’etat c’est moi” I am the state I am the state

Reign: 1643-1715Reign: 1643-1715 Fronde (1649-53) Fronde (1649-53) Civil war Civil war

of nobles against King. of nobles against King. Strong influence on Louis Strong influence on Louis XIV absolutist policies.XIV absolutist policies.

Goals:Goals:• Control noblesControl nobles• Develop strong military Develop strong military

loyal only to the kingloyal only to the king• Create Royal civil Create Royal civil

service loyal to the kingservice loyal to the king• Impose authority over Impose authority over

church & religion of his church & religion of his subjects. Thousands of subjects. Thousands of Huguenots left France.Huguenots left France.

IMAGE OF LOUIS XIVIMAGE OF LOUIS XIV Grand Monarch, worthy of awe, fashionable, decadentGrand Monarch, worthy of awe, fashionable, decadent Palace at Versailles – 17,000 acres. Luxurious living amid Palace at Versailles – 17,000 acres. Luxurious living amid

marble, statues, fountains, handcrafted furniture.marble, statues, fountains, handcrafted furniture. Nobles kept at Versailles to be controlled and supervised.Nobles kept at Versailles to be controlled and supervised.

MERCANTILISMMERCANTILISM Governmental regulation of all aspects of Governmental regulation of all aspects of

the economy.the economy. Jean-Baptiste Colbert (1619-1683) finance Jean-Baptiste Colbert (1619-1683) finance

minister created:minister created:• System of tariffs & trade prohibitions against System of tariffs & trade prohibitions against

foreign importsforeign imports• Imported skilled workersImported skilled workers• Subsidized French luxury industries like silk, Subsidized French luxury industries like silk,

lace, fine woolens, glasslace, fine woolens, glass• Improved internal transportImproved internal transport• Chartered overseas trading companies to Chartered overseas trading companies to

monopolize commercemonopolize commerce

BULLIONISMBULLIONISM Theory that state’s Theory that state’s

wealth is found in wealth is found in precious metals precious metals “buillion” (e.g. gold, “buillion” (e.g. gold, silver).silver).

Trade policy should Trade policy should guarantee favorable guarantee favorable balance of trade to balance of trade to maximize amount of maximize amount of buillion held by the buillion held by the state.state.

Favorable balance of Favorable balance of tradetrade = import more = import more than you exportthan you export

Strategies to maximize bullionStrategies to maximize bullion

Subsidies to native Subsidies to native industry like silk, lace.industry like silk, lace.

Chartered monopolies Chartered monopolies for overseas tradefor overseas trade

Taxes, tariffs & tollsTaxes, tariffs & tolls Colonial expansion. Colonial expansion.

Colonies were favored Colonies were favored markets for French markets for French goods & cheap source goods & cheap source of raw materials.of raw materials.

French Silk

French Lace

FRENCH COLONIES EAST FRENCH COLONIES EAST AFRICAAFRICA

FRENCH COLONIES CARIBBEANFRENCH COLONIES CARIBBEAN

ENGLISH ABSOLUTISMENGLISH ABSOLUTISM

Between death of Between death of Elizabeth I in 1603 & Elizabeth I in 1603 & Glorious Revolution of Glorious Revolution of 1688, ongoing debate 1688, ongoing debate about fundamental about fundamental nature of government.nature of government.

King v. Parliament. King v. Parliament. Centrality of monarch Centrality of monarch v. individuals who saw v. individuals who saw nation’s will expressed nation’s will expressed through Parliament.through Parliament.

CHARLES I, (1600-1649)STUART CHARLES I, (1600-1649)STUART

Ongoing conflict with Parliament over matters of Ongoing conflict with Parliament over matters of finance, taxes, imprisonment, religion.finance, taxes, imprisonment, religion.

Ruled without Parliament 1629-40.Ruled without Parliament 1629-40. Desperate for funds, King was forced to Desperate for funds, King was forced to

reconvene Parliament. He then began forceful reconvene Parliament. He then began forceful measures imprisoning dissidents, imposing illegal measures imprisoning dissidents, imposing illegal taxes, forcing men into army.taxes, forcing men into army.

1642-28. English Civil War. Royalists v. 1642-28. English Civil War. Royalists v. Parliamentarians - Presbyterian Parliament, Parliamentarians - Presbyterian Parliament, Conservative army officers (Puritans), radical Conservative army officers (Puritans), radical soldiers soldiers

KING CHARLES I, EnglandKING CHARLES I, England

EXECUTED 1649

ENGLAND 1649-1685ENGLAND 1649-1685 Various attempts at a Puritan Various attempts at a Puritan

Commonwealth failed.Commonwealth failed. 1660 – Charles II returned from exile in 1660 – Charles II returned from exile in

France, restored to throne. “Restoration”.France, restored to throne. “Restoration”. 1685, James II succeeds his brother 1685, James II succeeds his brother

Charles II. He openly sympathized with Charles II. He openly sympathized with Catholics. Catholics.

When James had a son, Parliament reacted When James had a son, Parliament reacted by offering the crown to Mary Stuart, his by offering the crown to Mary Stuart, his Protestant daughter by an earlier Protestant daughter by an earlier marriage. marriage.

GLORIOUS REVOLUTION, 1688GLORIOUS REVOLUTION, 1688

Mary Stuart accepts Mary Stuart accepts Parliament’s offer if Parliament’s offer if they agree to accept they agree to accept her husband William her husband William of Orange (Dutch of Orange (Dutch Protestant) as co-Protestant) as co-ruler.ruler.

James forced into exile James forced into exile in France.in France.

Parliament insists on Parliament insists on Bill of Rights.Bill of Rights.

ENGLISH BILL OF RIGHTS ENGLISH BILL OF RIGHTS King could not suspend laws.King could not suspend laws. No taxes could be levied or standing army No taxes could be levied or standing army

maintained in peace without Parliament’s maintained in peace without Parliament’s approval.approval.

Sessions of Parliament would be held regularly.Sessions of Parliament would be held regularly. Freedom of speech in Parliament guaranteed.Freedom of speech in Parliament guaranteed. Right of petition and freedom from excessive Right of petition and freedom from excessive

fines, bail or cruel punishments guaranteed.fines, bail or cruel punishments guaranteed. King (or Queen) must be Protestant.King (or Queen) must be Protestant.

Parliament empowered,Parliament empowered,King’s power diminished.King’s power diminished.