How the Dutch Became Masters of Their Own Fate
The Secret of Dutch Commercial Policy in the 17th Century
Rizky Bayuputra for Le Citoyen
LE CITOYEN — One little known fact in world history often overshadowed by larger, though perhaps smaller in impact, events were those that circled a small nation in Northwest Europe between the 16th and 17th centuries. A small nation, largely irrelevant in preceding centuries (especially in comparison to her neighbours, the French, English, the Spaniards, even the Flemish!) that rose from a state of oppression and managed to throw the largest empire in the world at the time off its knees, becoming a forced to be reckoned with, standing amongst giants and despots as its own powerful entity feared not only in its skill of waging war, but in the sciences, the progression of art, and most importantly, mastery over world trade. It is not rare for us to hear of such great names: the painters Rembrandt and Vermeer, the biologist Van Leeuwenhoek, the astronomer and polymath Christiaan Huygens, the colonial administrator Jan Pietersz. Coen, the jurist De Groot (Grotius), and such advanced institutions such as the first public company, VOC, led by the most venerated Gentlemen XVII, all growing during and after the Eighty Years War (and the Thirty Years’ War which coincided) — all rose and contributed to a period in history known as the Dutch Golden Age.
However, a question arises: how did the Hollanders, the Zeelanders, the Frisians, and the other members of the seven United Provinces of the Netherlands came to be a world power, when just not many years ago they were but a vassal to the grandeur, and at the mercy, of the Spanish Empire, who had not only threw away the Moors from Iberia, but also discovered and conquered much of the New World less than a century before? This article will attempt to answer such question in an overviewing manner, as stark and concise as possible, so readers may more understand a rather ‘forgotten’ and ‘unpopular’ moment in history which shows evidence that even such small a nation, out of desperation, sheer willpower, and a spirit of innovation, could bring itself to the forefront of the world.
A quick overview on the Spanish Netherlands, and the birth of the Dutch Republic
In the 16th century, at the onset of Luther’s (and others’) Christian Reformation in Europe, the Christian bible was made available for print and distributed in different languages, allowing even common folk to understand scripture, and therefore, allowed the defeat of the Catholic Church’s hegemony on knowledge and the law (governed by statute, precedent, and Canon). This created masses of discontented Christians (both nobility and common-folk alike) inspired by the likes of Martin Luther, Jean Calvin, and Ulrich Zwingli, resulting in the split of Western and Central Europe into two contrasting powers, that of the domain of the Catholic Church, including the Italian States, the Iberian Peninsular Kings (Castille and Aragon, or more popularly known as 'Spain,' and Portugal), France, and several German states (such as Bavaria and Westphalia, then still under the Holy Roman Imperial confederation), and that of the domain of the Reformist Protestants[1]–England, Sweden, Scotland, Southern France (the Huguenots), and not surprisingly, Northern Spanish Netherlands, which constitutes as the Netherlands we know as today.
In reaction to this split, oppressive measures were taken in the Spanish dominions, where the Dutch still remained vassals to the Spanish monarch. The Dutch, mainly Calvinists, saw injustice in the Spanish King’s policy of making heresy (i.e. being non-catholic) a capital offence; in result of this, about 1,300 people were executed, and many more put to imprisonment between 1530–1566. [2] Such Spanish regulations (grossly) infringed on many civil liberties the Dutch perceived as fundamental to their society (in the so-called Compromise of Nobles, even Dutch Catholic noblemen shared the same opinion).[3] This, along with the exile of many prominent Dutch noblemen (including future Stadtholder, William the Silent) resulted in the first of many revolts, with both noble and commoner standing together against a far-away king, who stood at the head of an empire where Helios never set.
1566 marked the beginning of the Eighty Years’ War which was fought between the peoples of the northern provinces against Spanish rule, inciting such famous names such as William the Silent (Prince of Orange, Dutch: 'Wilhelm de Zwijger’) and his son Maurice, which ultimately ended in 1648 with the seven northern provinces finally firmly independent as its own nation state as result of the Westphalian Treaty (which also ended the Thirty Years’ War), ending a long string of European Wars of Religion which had started as an act of protest against the Church, and returning a semblance of order among the European nations especially in its diplomatic dealings. (See Henry Kissinger’s World Order for more on this topic)
The industrious Dutch and their mastery of trade and business
Surely, in comparison to the Spanish Empire and her plethora of Catholic allies, it was as if they could take down the fledgling Dutch Republic with a mere slap of the hand. However, strong attachment to their values and interests along with shrewd diplomacy (with protestant allies such as the English, though this too broke down in the early 17th century, with clashes in the East Indies) and lucrative trade deals in friendly nations (conducted first and foremost by merchant companies), along with countless innovations in the arts and sciences had allowed the Dutch not only to persevere over their former masters in the south but also to enter a Golden Age of a nation.
One thing that could be attributed to Dutch greatness was their mastery of trade and business in the northern sea. The book The Dutch in The Far East by Albert Hyma describes the Dutch, to the English, were a nation whom individuals were of model character:
During the seventeenth century, it became the custom for many Englishmen, when they were surprised about a certain remarkable incident, to say, “That beats the Dutch!” So popular did this proverb become among Englishmen that it was transmited to the Americans, most of whom no longer have any conception of how it originated. They have forgotten that in the time of the Puritans and the Pilgrim Fathers, the Dutch were unsurpassed in commercial and industrial enterprise.
The writer also commends Dutch industriousness, citing that almost no citizen of Amsterdam, Holland remained unemployed:[4]
(Referring to the works of Jacques Couer, Superintendent of Finances in the reign of Charles VII):
[…] The Dutch showed that they perfectly understood the good points of mercantilism. In the field of the textile industries during the seventeenth century, as the writer pointed out, they led all nations. He compared Amsterdam, of whom one writer said: “All its inhabitants followed some trade; that the lame and the gouty were employed, and even those that had the gout in their hands did not sit idle.”
Hyma also describes that Dutch practices in business and trade, especially in merchant shipping, were of model character, and was an example to many seafaring nations such as the English.[5] The author attributes Dutch qualities as masters in the fishing trade, with the richness of herring in the North Sea which the Dutch took advantage of very well, a complex irrigation system which provided the Dutch countryside significant crop yields, and the best-managed merchant navy in the world at the time, along with public policy that supported such activities.[6] With these qualities, the people of the United Netherlands became a dominant force in trade in Northern and Western Europe, and in those areas, surpassing even the English, Spanish, and French.
Famous English explorer Sir Walter Raleigh nominates seven reasons that attributed to Dutch commercial success in the 16th and 17th century. Quoting the gentleman: [7]
1. The merchant staplers which make all things in abundance, by reason of their storehouses continually replenished with all kinds of commodities
2. The liberty of free traffick for strangers to buy and sell in Holand, and other countries and states, as if they were freeborn, makes great intercourse.
3. The small duties levied upon merchants draws all nations to trade with them (in this context, taxes on merchant vessels sitting in berth along with goods sold)
4. Their fashioned ships continually freighted before ours, by reason of their few mariners and great bulk, serving the merchant cheap
5. Their forwardness to all manner of trading;
6. Their wonderful employment of their busses for fishing, and the great returns they make
7. Their giving free custom, inwards and outwards, for any new-erected trade; by means where of they have gotten already almost the sole trade into their hands.
If the reader finds Sir Walter’s English rather confusing, I shall gladly summarise: factors such as (1) well-invested funds by bankers and speculators alike in valuable commodities, (2) an investor-foreign-free trade-friendly environment to people of all origins and creeds, (3) subsidies in tax for such merchantmen of whom benefit the Republic regardless of vessel flag, (4) ingenuity in marine engineering, such as the fluyt ship which allowed maximum cargo and minimum seamen operating it in comparison to other nations’ vessels (the galleon, for instance, which is a merchantman that has the capacity as well to store cannon for its defence and conversion to a man-of-war during wartime, and therefore larger and heavier thus requiring more crew), (5 and 7) That they were open to many different trades and commodities unlimited by superstition except that for the furthering of advancement of self and nation, and (6) the use of specialised fishing vessel, in which Sir Walter here refers to ‘The Herring Buss’ and shrewd business structures and arrangements which allowed large yields.
Walter Hyma prescribes the success of these policies where Dutch-flagged ships, as recorded by Danish officials, were the majority of vessels passing through the Denmark straits (two-thirds of all vessels), to and from the Baltic Sea.[8] This also resulted in the Dutch controlling one half of European trade by sea.[9] One factor Hyma also attributes as no less importance is the emergence of marine insurance companies, allowing risks to be diverted away from merchants and the goods they sold and to banks or other financial institutions of the time, allowing merchants to traverse the waters regardless of the danger of pirates or other perils one expected be met at sea.[10]
At the end of their eastern voyages, they would dock in Russian ports, where the Russians accepted textile and spices, among other goods, and the Dutch accepted furs and other valuable commodities to be sold further west or south.[11] Spices, however, came into great difficulty when breakdown in diplomacy that took place after the Iberian union in the late 16th century, where Iberian policy governed that no Dutch-flagged ship be allowed to port in Lisbon (as the Eighty Years’ War was still underway), the centre of the European spice trade (where Hispano-Portuguese merchant ships from the Indies and Spice Islands brought valuable spices). This event would then lead to one of the greatest adventures of all time, where stakes were the survival of a nation, and the greatest minds of the Dutch nation were put to work and out of desperation and sheer brilliance, gave birth to one of the most important institutions in human history: The Public Limited Company, though this is a story for a later article.
Conclusion
We can see based on what has been brought by Albert Hyma, Sir Walter Raleigh, and Jacques Couer that the Dutch weren’t only industrious, highly-determined, and adept at their trade, but had a government that actively supported these activities, even investing in them at some point (e.g. the Dutch East Indies Company later on, which was a merger of many smaller merchant companies from the Dutch Provinces…). Innovation in the fields of law, business, and engineering, as well as a spirit of tolerance and free trade allowed the Dutch people to reap the benefits of hard work, paired with fortress-like resilience and steely determination against enemies even against all odds (the Spanish) as well as shrewd dealings with friendly nations (Russia and England), vital elements that allowed the Dutch to establish their Golden Age as we know today.
However one large hole remains unfilled, something we can see as prima facie evidence to Dutch mastery over trade and mercantile, a subject I would like to discuss in a later date and hopefully so, soon: The Verenigde Oost-Indische Compagnie, the United East India Company, and their colonial adventures in the East to defeat Spanish monopoly on spices, and eventually, controlling it for their own.
[1] Whether it be Calvinist, Lutheran, Anabaptist, Anglican or any other denomination, it is safe to say based on facts of the time, that these peoples under the same protest against the Church were held to be in the same league.
[2] J.D. Tracy, The Founding of the Dutch Republic: War, Finance, and Politics in Holland 1572–1588, (Oxford: Oxford University Press, 2008) p. 66
[3] The Founding of the Dutch Republic, pp. 69–70
[4] Albert Hyma, The History of the Dutch in the Far East (Ann Arbor, Michingan: Geore Wahr Publishing Company, 1953) p. 18
[5] Dutch in the Far East, p.1.
[6] Ibid. p. 1–18
[7] Sir Walter Raleigh, “Observations Touching Trade and Commerce with the Hollander, and other Nations,” in: The Works of Sir Walter Raleigh, now first collected to which are prefixed the lieves of the author, by Oldys and Birch, Vol. III (Oxford, 1829), p.370.
[8] Dutch in the Far East, pp. 5, 9.
[9] Ibid. Chapter 1
[10] Ibid.
[11] Ibid.
