Como a intervenção estatal cria conflitos.

 Virou moda afirmar que "conservadores" como John C. Calhoun (1782-1850) "previram" a doutrina marxista de exploração de classes.  Mas a doutrina marxista sustenta, erroneamente, que no livre mercado há "classes" cujos interesses colidem e conflitam.  A percepção de Calhoun era quase o oposto disso.  Ele viu que era a intervenção estatal que criava, por si mesma, as "classes" e o conflito[1].  Calhoun se deu conta disso, em especial, no caso da intervenção binária dos impostos, pois viu que o montante arrecadado em impostos é empregado em gastos e que alguns indivíduos na comunidade deveriam ser contribuintes finais dos fundos fiscais, enquanto outros, recebedores finais.  Calhoun definiu os recebedores como "classe dominante" de exploradores e os contribuintes como explorados ou classe "dominada"; e a distinção é bastante convincente.  Eis como Calhoun brilhantemente demonstrou sua análise:

Mesmo sendo poucos se comparados com a comunidade, os agentes e funcionários do governo constituem uma parcela composta, exclusivamente, de beneficiários da receita dos impostos.  Qualquer montante arrecadado da comunidade na forma de impostos, se não for perdido, volta para eles como despesas ou bens publicamente financiados.  Ambos — financiamentos e tributação — constituem a ação fiscal do governo.  São mutuamente dependentes.  O que é arrecadado da comunidade sob a forma de imposto é transferido para aquela parte que é beneficiada com tais financiamentos.  Mas como os beneficiários constituem apenas uma parte da comunidade, entende-se que, tomando as duas partes do processo fiscal, a ação deva ser desigual entre os que pagam impostos e os que recebem a receita deles proveniente.  Nem poderia ser diferente, a menos que o montante arrecadado de cada indivíduo sob a forma de impostos retornasse para o próprio na forma de financiamentos, o que tornaria o processo inútil e absurdo. [...]

Sendo esse o caso, entende-se necessariamente que uma parte da comunidade deva pagar uma quantia em impostos maior do que o valor recebido de volta em bens publicamente financiados, enquanto outra parte recebe em financiamentos mais do que pagou em impostos.  É evidente, então, levando em conta todo o processo, que os impostos sejam, na realidade, benesses para a parcela da comunidade que recebe mais bens publicamente financiados do que paga em impostos, ao passo que aos que pagam mais impostos do que recebem em financiamentos públicos, tais despesas são verdadeiros impostos — ônus e não liberalidades.  Esta consequência é inevitável, e resulta da natureza do processo, ainda que os impostos sejam distribuídos da maneira mais equilibrada possível. [...]

Então, o resultado inevitável da desigual ação fiscal do governo é dividir a comunidade em duas grandes classes: a daqueles que, na realidade, pagam impostos e, é claro, suportam de maneira exclusiva o encargo de sustentar o governo; e a outra daqueles que recebem o montante arrecado por meio de bens publicamente financiados e são, na verdade, sustentados pelo governo; ou, em poucas palavras, classes de dos pagadores de impostos e dos consumidores de impostos.

Entretanto, o resultado disso é colocá-las em relações antagônicas face à ação fiscal do governo e a todo o curso da política imediatamente decorrente.  Pois, quanto maiores forem os impostos e financiamentos públicos, maior será o ganho de um e a perda de outro, e vice-versa[2].

[1]  O termo "castas" seria mais bem empregado aqui do que "classes".  Classes são grupos de pessoas com certas características em comum.  Não há razão para entrarem em conflito entre si.  A classe de homens que se chamam Jones não precisa entrar, necessariamente, em conflito com a classe de homens que se chamam Smith.  Por outro lado, castas são grupos criados pelo estado, cada qual com seu próprio conjunto de privilégios e tarefas estabelecido por meio de violência.  Castas entram necessariamente em conflito porque algumas são instituídas para dominar as outras.

[2] CALHOUN, John C. A Disquisition on Government. New York: Liberal Arts Press, 1953. pp. 16-18.  No entanto, Calhoun não entendeu a harmonia de interesses no livre mercado.

Titulo do original inglês: Power and Market: Government and the Economy 

Autor: Murray N. Rothbard

O Mito da Propriedade "Pública"

           Todos ouvimos muitas coisas a respeito da propriedade "pública".  Onde quer que, de fato, o governo tenha propriedade ou mantenha um empreendimento, dizem se tratar de uma "propriedade pública".  Quando recursos naturais são vendidos ou dados a empresas privadas, aprendemos que o "domínio público" foi "entregue" aos estreitos interesses privados.  A inferência é que quando o governo é dono de qualquer coisa, "nós" — todos os membros do público — possuímos uma parcela igual daquela propriedade.  Diferem desse longo alcance os interesses inferiores e limitados da mera propriedade "privada".

 

            Como vimos, uma vez que o sistema econômico socialista não pode fazer o cálculo econômico, um socialista obstinado deve estar preparado para testemunhar o desaparecimento de grande parte da população do planeta, restando aos sobreviventes apenas um meio de vida primitivo.  Ainda, aquele que identifica propriedade do governo com propriedade pública deve ficar feliz em ampliar a área da propriedade governamental, não obstante a perda de eficiência ou a vantagem social que aquela ocasiona.

 

            Todavia, a própria identidade é totalmente falaciosa.   Propriedade é o controle e direção supremos de um recurso.  O proprietário é o gestor supremo, independente das ficções legais ao contrário.  Na sociedade de totalmente livre, os recursos demasiado abundantes que servissem como condições gerais de bem-estar humano permaneceriam sem dono.  Recursos escassos, por outro lado, seriam apropriados de acordo com os seguintes princípios: propriedade da pessoa sobre si mesma; propriedade daquilo que foi criado ou transformado pela pessoa; propriedade de terra devoluta pelo primeiro usuário ou transformador.  Propriedade do governo significa simplesmente que os funcionários públicos que estão no poder são os que a possuem.  Os funcionários superiores são os que dirigem o uso da propriedade e, por isso, são os "donos".  O "público" não tem nenhuma parcela da propriedade.  Qualquer cidadão que duvide disso pode tentar apropriar-se, para uso individual, de sua alíquota de propriedade pública e então tentar levar o caso aos tribunais.  Pode ser feita a objeção de que os acionistas das empresas também não podem fazer isso, por exemplo, pelas regras da empresa, o acionista da General Motors não pode apoderar-se de um carro em vez de dividendos em dinheiro ou em troca das ações.  No entanto, os acionistas realmente são donos da empresa, e esse exato exemplo prova a nossa argumentação.  O acionista pode desvencilhar-se da empresa; ele pode vender as ações da General Motors para outra pessoa.  O cidadão de um governo não podedesvencilhar-se do governo; ele não pode vender suas "ações" dos correios porque não possui tais ações.  Como sucintamente afirmou Floyd A. Harper (1905-1973): "O corolário do direito de propriedade é o direito de transferência.  Assim, se não posso vender uma coisa, é evidente que, na verdade, não a possuo"[17].

 

            Qualquer que seja a forma do governo, os dirigentes são os verdadeiros donos da propriedade.  Entretanto, em uma democracia, ou no longo prazo, em qualquer forma de governo, os dirigentes são transitórios.  Sempre podem perder uma eleição ou ser derrubados por um golpe de estado.  Por isso, nenhum funcionário do governo se vê como algo mais que um possuidor transitório.  Como resultado, enquanto o proprietário privado, seguro em sua propriedade e possuidor do valor do capital, planeja o uso de seu recurso por um longo período de tempo, o funcionário do governo deve explorar a propriedade o mais rápido que puder, já que sua propriedade não está assegurada.  Além disso, até mesmo o servidor público mais inveterado deve fazer a mesma coisa, pois nenhum funcionário do governo pode vender o valor capitalizado da "propriedade" que detêm, como o fazem os proprietários privados.  Em suma, os funcionários do governo detêm o uso dos recursos, mas não o valor de capital dos mesmos (exceto no caso da "propriedade privada" de um monarca hereditário).  Quando a pessoa só pode dispor do uso corrente, mas não o recurso em si, o resultado será a rápida exaustão e desperdício dos recursos, já que não beneficiará a ninguém conservá-los por um período de tempo e a vantagem para quem os possui é utilizá-los o mais rápido possível.  Desse modo, os funcionários do governo consumirão o que lhes couber, o mais rápido possível.

 

            É curioso que quase todos os autores papagueiam a noção de que proprietários privados que possuem preferência temporal devem seguir uma "visão de curto prazo", ao passo que somente os funcionários do governo podem seguir uma "visão de longo prazo" e alocar a propriedade para aumentar o "bem-estar geral".  A verdade é o exato oposto.  O indivíduo privado, seguro de sua propriedade e do recurso de seu capital, pode optar pelo longo prazo, pois quer manter o valor de capital de seu recurso.  É o funcionário público que perde por esperar, que deve saquear a propriedade enquanto ainda está no comando[18].

[17] HARPER, F. A. Liberty, a Path to Its Recovery. Irvington-on-Hudson: Foundation for Economic Education, 1949. pp. 106, 132. Ver também: PATERSON. God of the Machine. pp. 179ss. Isabel Paterson travou uma discussão estimulante a respeito das "duas dimensionalidades" – a negligência das verdadeiras condições – na teoria da propriedade coletiva.

[18] Aqueles que objetam ao dizer que os indivíduos privados são mortais, mas os "governos são imortais", caem na falácia do "realismo conceitual" no grau máximo. O "governo" não é uma verdadeira entidade agente, mas é uma categoria de ação real adotada por indivíduos verdadeiros. É um nome para um tipo de ação, a regularização de um tipo de relação interpessoal e não é, ele mesmo, um ser que age.

A importância do Mises Institute

The Mises Institute comes at both economic scholarship and applied political philosophy from a very different perspective. It believes that "policy analysis" without principle is mere flim-flam and ad-hocery—murky political conclusions resting on foundations of sand. It also believes that policy analysis that does not rest on scholarly principles is scarcely worth the paper it is written on or the time and money devoted to it. In short, that the only worthwhile analysis of the contemporary political and economic scene rests consistently on firm scholarly principles.

On the other hand, the Mises Institute challenges the all-too-prevalent view that to be scholarly means never, ever to take an ideological position. On the contrary, to the Mises Institute, the very devotion to truth on which scholarship rests necessarily implies that truth must be pursued and applied wherever it may lead—including the realm of current affairs. Economic scholarship divorced from application is only emasculated intellectual game-playing, just as public policy analysis without scholarship is chaos cut off from principle.

And so we see the real point underlying the uniqueness of the Mises Institute's twin programs of scholarship and application: the artificial split between the two realms is healed at last. Scholarly principles are carried forward into the analysis of government and its machinations, just as contemporary political economy now rests on sound scholarly research. From first axioms to applications, both scholarship and applied economics are an integrated whole, at long last.

 

And now, too, we see the real point behind the title of the Mises Institute. It is no accident that the Institute is the only organization in the United States that honors Ludwig von Mises in its title. For Ludwig von Mises, in his life and in his work, exemplified as no other man the fusion, the integration, of scholarly principle and principled application. Mises, one of the greatest intellects and scholars of the 20th century, scorned any notion that scholarship should remain content with abstract theorizing and never, ever apply its principles to public policy.

On the contrary, Mises always combined scholarship with policy conclusions. A man of high courage, a scholar with unusual integrity, Ludwig von Mises never knew any other way than pursuing truth to its ultimate conclusions, however unpopular or unpalatable. And, as a result, Ludwig von Mises was the greatest and most uncompromising champion of human freedom in the 20th century.

 

It is no wonder, then, that the timorous and the venal habitually shy away from the very name of Ludwig von Mises. For Mises scorned all obstacles and temptations in the pursuit of truth and freedom. In raising the proud banner of Ludwig von Mises, the Mises Institute has indeed set up a standard to which the wise and honest can repair.

The Mises Institute is expanding and flourishing as never before. Its scholarly journal, a high level journal in the theory and applications of Austrian economics, serves to expand and develop the truths of Austrian economics. But it also nurtures Austrians, encourages new, young Austrians to read and write for the journal, and finds mature Austrians theretofore isolated and scattered in often lonely academic outposts, but who are now stimulated to write and submit articles.

These men and women now know that they are not isolated, that they are part of a large and growing nationwide and even international movement. Any of us who remember what it was like to find even one other person who agreed with our seemingly eccentric views in favor of freedom and the free market will appreciate what I mean, and how vitally important has been the growing role of the Mises Institute.

The Institute's comprehensive program in Austrian education also includes publishing and distributing working papers, books, and monographs, original and reprinted, and holding conferences on a variety of important economic topics, and later publishing the conference papers in book form. Its monthly policy letter, The Free Market, provides incisive commentary on the world of political economy from an Austrian perspective.

Last but emphatically not least, the Institute sponsors a phenomenally successful week-long summer conference in the Austrian School. This program, which features a remarkable faculty, has attracted the best young minds from the world over, and gained deserved recognition as the most rigorous and comprehensive program anywhere. Here, leading Austrian economists engage in intensive instruction and discussion with students in a lovely campus setting. Participants are literally the best, the brightest and the most eager budding Austrians. From there they go on to develop, graduate, and themselves teach as Austrian scholars, or become businessmen or other opinion leaders imbued with the truth and the importance of Austrian and free- market economics.

 

The Institute encourages fellowship and an esprit de corps among faculty and students. These friendships and associations may be lifelong, and they are vital for building any sort of vibrant or cohesive long-run movement for Austrian economics and the free society.

 

The basic point of this glittering spectrum of activities is twofold: to advance the discipline, the expanding, integrated body of truth that is Austrian economics; and to build a flourishing movement of Austrian economists. No science, no discipline, develops in thin air, in the abstract; it must be nurtured and advanced by people, by individual men and women who talk to each other, write to and for each other, interact and help build the body of Austrian economics and the people who sustain it.

The remarkable achievement of the Mises Institute can only be understood in the context of what preceded it, and of the conditions it faced when it began in 1982. In 1974, leading Mises student F.A. Hayek won the Nobel Prize in economics, a startling change from previous Nobel awards, exclusively for mathematical Keynesians. 1974 was also the year after the death of the great modern Austrian theorist and champion of freedom, Ludwig von Mises. Hayek's prize sparked a veritable revival in this long-for-gotten school of economic thought. For several years thereafter, annual scholarly week-long conferences gathered the leading Austrian economists of the day, as well as the brightest young students; and the papers delivered at these meetings became published volumes, reviving and advancing the Austrian approach. Austrian economics was being revived from forty years of neglect imposed by the Keynesian Revolution—a revolution that sent the contrasting and once flourishing school of Austrian economics down the Orwellian memory hole.

 

In this burgeoning Austrian revival, there was one fixed point so obvious that it was virtually taken for granted: that the heart and soul of Austrianism was, is, and can only be Ludwig von Mises, this great creative mind who had launched, established and developed the twentieth-century Austrian school, and the man whose courage and devotion to unvarnished, uncompromised truth led him to be the outstanding battler for freedom and laissez-faire economics in our century. In his ideas, and in the glory of his personal example, Mises was an inspiration and a beacon-light for us all.

But then, in the midst of this flourishing development, something began to go wrong. After the last successful conference in the summer of 1976, the annual high-level seminars disappeared. Proposals to solidify and expand the success of the boom by launching a scholarly Austrian journal, were repeatedly rebuffed. The elementary instructional summer seminars continued, but their tone began to change. Increasingly, we began to hear disturbing news of an odious new line being spread: Mises, they whispered, had been "too dogmatic, too extreme," he "thought he knew the truth," he "alienated people."

Yes, of course, Mises was "dogmatic," i.e. he was totally devoted to truth and to freedom and free enterprise. Yes, indeed, Mises, even though the kindliest and most inspiring of men, "alienated people" all the time, that is, he systematically alienated collectivists, socialists, statists, and trimmers and opportunists of all stripes.

And of course such charges were nothing new. Mises had been hit with these smears all of his valiant and indomitable life. The terribly disturbing thing was that the people mouthing these canards all knew better: for they had all been seemingly dedicated Misesians before and during the "boom" period.

It soon became all too clear what game was afoot. Whether independently or in concert, the various people and groups involved in this shift had made a conscious critical decision: they had come to the conclusion they should have understood long before, that praxeology, Austrian economics, uncompromising laissez-faire were popular neither with politicians nor with the Establishment. Nor were these views very "respectable" among mainstream academics. The small knot of wealthy donors decided that the route to money and power lay elsewhere, while many young scholars decided that the road to academic tenure was through cozying up to attitudes popular in academia instead of maintaining a commitment to often despised truth.

 

But these trimmers did not wish to attack Mises or Austrianism directly; they knew that Ludwig von Mises was admired and literally beloved by a large number of businessmen and members of the intelligent public, and they did not want to alienate their existing or potential support. What to do? The same thing that was done by groups a century ago that captured the noble word "liberal" and twisted it to mean its opposite—statism and tyranny, instead of liberty. The same thing that was done when the meaning of the U.S. Constitution was changed from a document that restricted government power over the individual, to one that endorsed and legitimated such power. As the noted economic journalist Garet Garrett wrote about the New Deal: "Revolution within the form," keep the name Austrian, but change the content to its virtual opposite. Change the content from devotion to economic law and free markets, to a fuzzy nihilism, to a mushy acceptance of Mises's ancient foes: historicism, institutionalism, even Marxism and collectivism. All, no doubt, more "respectable" in many academic circles. And Mises? Instead of attacking him openly, ignore him, and once in a while intimate that Mises really, down deep, would have agreed with this new dispensation.

 

Into this miasma, into this blight, at the point when the ideas of Ludwig von Mises were about to be lost to history for the second and last time, and when the very name of "Austrian" had been captured from within by its opposite, there entered the fledgling Mises Institute.

 

The Ludwig von Mises Institute began in the fall of 1982 with only an idea; it had no sugar daddies, no endowments, no billionaires to help it make its way in the world. In fact, the powers-that-be in what was now the Austrian "Establishment" tried their very worst to see that the Mises Institute did not succeed.

 

The Mises Institute persisted, however, inspired by the light of truth and liberty, and gradually but surely we began to find friends and supporters who had a great love for Ludwig von Mises and the ideals and principles he fought for throughout his life. The Institute found that its hopes were justified: that there are indeed many more devoted champions of freedom and the free market in America. Our journal and conferences and centers and fellowships have flourished, and we were able to launch a scholarly but uncompromising assault on the nihilism and statism that had been sold to the unsuspecting world as "Austrian" economics.

The result of this struggle has been highly gratifying. Thousands of students are exposed to the Austrian School as a radical alternative to mainstream theory. For the light of truth has prevailed over duplicity. There are no longer any viable competitors for the name of Austrian. The free market again has principled and courageous champions. Justice, for once, has triumphed. Not only is the Austrian economic revival flourishing as never before, but it is now developing soundly within a genuine Austrian framework. Above all, Austrian economics is once again, as it ever shall be, Misesian.

Mises ESCRACHANDO em uma crítica a livro de Rothbard

In every chapter of his treatise, Dr. Rothbard, adopting the best of the teachings of his

predecessors, and adding to them highly important observations, not only develops

the correct theory but is no less anxious to refute all objections ever raised against

these doctrines. He exposes the fallacies and contradictions of the popular

interpretation of economic affairs. Thus, for instance, in dealing with the problem of

unemployment he points out: in the whole modern and Keynesian discussion of this

subject the missing link is precisely the wage rate. It is meaningless to talk of

unemployment or employment without reference to a wage rate. Whatever supply of

labor service is brought to market can be sold, but only if wages are set at whatever

rate will clear the market. If a man wishes to be employed, he will be, provided the

wage rate is adjusted according to what Rothbard calls his discounted marginal value

product, i.e., the present height of the value which the consumers — at the time of the

final sale of the product — will ascribe to his contribution to its production.

Whenever the job seeker insists on a higher wage, he will remain unemployed. If

people refuse to be employed except at places, in occupations, or at wage rates they

would like, then they are likely to be choosing unemployment for substantial periods.

The full import of this state of affairs becomes manifest if one gives attention to the

fact that, under present conditions, those offering their services on the labor market

themselves represent the immense majority of the consumers whose buying or

abstention from buying ultimately determines the height of wage rates.

Less successful than his investigations in the fields of general praxeology and

economics are the author's occasional observations concerning the philosophy of law

and some problems of the penal code. But disagreement with his opinions concerning

these matters cannot prevent me from qualifying Rothbard's work as an epochal

contribution to the general science of human action, praxeology, and its practically

most important and, up to now, best-elaborated part, economics. Henceforth all

essential studies in these branches of knowledge will have to take full account of the

theories and criticisms expounded by Dr. Rothbard.

The publication of a standard book on economics raises again an important question,

viz., for whom are essays of this consequence written: only for specialists, the

students of economics, or for all of the people?

To answer this question we have to keep in mind that the citizens, in their capacity as

voters, are called upon to determine ultimately all issues of economic policies. The

fact that the masses are ignorant of physics and do not know anything substantial

about electricity does not obstruct the endeavors of experts who utilize the teachings

of science for the satisfaction of the wants of the consumers. From various points of

view, one may deplore the intellectual insufficiency and indolence of the multitude.

But their ignorance regarding the achievements of the natural sciences does not

endanger our spiritual and material welfare.

It is quite different in the field of economics. The fact that the majority of our

contemporaries, the masses of semi-barbarians led by self-styled intellectuals, entirely

ignore everything that economics has brought forward, is the main political problem

of our age. There is no use in deceiving ourselves. American public opinion rejects

the market economy, the capitalistic free-enterprise system that provided the nation

with the highest standard of living ever attained. Full government control of all

activities of the individual is virtually the goal of both national parties. The individual

is to be deprived of his moral, political, and economic responsibility and autonomy,

and to be converted into a pawn in the schemes of a supreme authority aiming at a

"national" purpose. His "affluence" is to be cut down for the benefit of what is called

the "public sector," i.e., the machine operated by the party in power. Hosts of authors,

writers, and professors are busy denouncing alleged shortcomings of capitalism and

exalting the virtues of "planning." Full of a quasi-religious ardor, the immense

majority is advocating measures that step by step lead to the methods of

administration practiced in Moscow and in Peking.

O primeiro mercantilista...

Se no último texto que colocamos aqui no blog tivemos Juan de Mariana, extremista libertário, que instado a escrever um livro para agradar Felipe II, da Espanha [livro dedicado ao filho deste,Felipe III], resolveu fazer uma defesa franca do TIRANICÍDIO, elencou vários tiranos e os colocou como tais, bem como resolveu afirmar que a soberania do Rei vem do povo, na contramão da então crescente apologia ao poder concentrado. Já em outro livro denunciou a prática de alterar o conteúdo das moedas para ganhar um "extra" e,explicitamente, considerou a prática como criminosa. Ou seja, fazer média não era com Juan de Mariana.

 

Em contraste a esse grande homem, apresentamos Carafa, mercantilista, protecionista e que adorava bajular poderosos e, afinal, começou a pensar em termos de "agregados", "indução da economia", entre outras excrecências . A fonte é a mesma do texto anterior [o link está lá, o excerto é da terceira seção do sexto capítulo], que é o importantíssimo livro de Rothbard sobre o pensamento econômico anterior a Adam Smith.

 

"The Florentine humanists of the early fifteenth century had been optimistic for man, for his quest for

virtus (or virtu) or excellence, and for the 'honour, praise, and glory' which more traditional Christians had thought due only to God. It was therefore easy for the later, sixteenth century humanists to transfer that quest for excellence and glory from individual man to being the sole function of the prince. Thus Castiglione declares that the courtier's chief goal, 'the end to which he is directed', must be to advise his prince so that the latter may attain 'the pinnacle of glory' and make himself 'famous and illustrious in the world' .

 

The earlier republican humanists had nurtured the ideal of 'liberty', by which they meant, not the modern concept of individual rights, but republican, generally oIigarchial, 'self-government'. Castiglione expressly condemns such old notions, on behalf of the monarchical virtues of peace, absence of discord, and total obedience to the absolute prince. In The Book of the Courtier, one of the characters in the dialogue protests that princes 'hold their subjects in the closest bondage' so that liberty is gone. Castiglione shrewdly counters, in age-old terms used in numerous apologia for despotism, that such liberty is only a plea that we be allowed to 'live as we like' rather than 'according to good laws'. Since liberty is only licence, then, a monarch is needed to 'establish his people in such laws and ordinances that they may live in ease and peace' .

A leading writer of advice-books to both the prince and the courtier, and a man who bears the dubious distinction of being perhaps the first mercantilist, was the Neapolitan duke, Diomede Carafa (1407-87). Carafa wrote The Perfect Courtier

while serving at the court of Ferdinand, king of Naples, in the 1480s, as well as "The Office of a Good Prince" during

the same period. In The Perfect Courtier, Carafa set the tone for Castiglione's enormously influential work a generation later. In his

Office of a Good Prince, Carafa set the model for the form of economic advice presented by consultant administrators. As in many later works, the book begins with principles of general policy and defence, then goes on to administration of justice, to public finance, and finally economic policy proper.

In detailed policies, Carafa's advice is relatively sensible, and not nearly as totally power-oriented or as statist as later mercantilists advising fully fledged nation-states. The budget should be balanced, since forced loans are comparable to robbery and theft, and taxes should be equitable and moderate in order not to oppress labour or drive capital from the country. Business should be left alone but, on the other hand, Carafa called for subsidies of industry, agriculture, and commerce by the state, as well as substantial welfare expenditures. In contrast to the later mercantilists, foreign merchants, declared Carafa, should be made welcome because their activities are highly useful to the country.

 

But there is no hint in Carafa, in contrast to the scholastics, of any desire to understand or analyse market processes. The only important question was how the ruler can manipulate them. As Schumpeter wrote of Carafa: 'The normal processes of economic life harbored no problem for Carafa. The only problem was how to manage and improve them'.

 

Schumpeter also attributes to Carafa the first conception of a national economy, of the entire country as one large business unit managed by the prince. Carafa was,

so far as I know, the first to deal comprehensively with the economic problems of

the nascent modern state the fundamental idea that Carafa clothed in his conception

of the Good Prince of a National Economy... [which] is not simply the

sum total of the individual households and firms or of the groups and classes within the borders of a state.

It is conceived as a sort of sublimated business unit,

something that has a distinct existence and distinct interests of its own and needs to be managed like a big farm. "

I

The learned extremist: Juan de Mariana

One of the last Spanish scholastics was a Jesuit but not a Salamancan. He was the 'extremist' contemporary of Molina and Suarez, Juan de Mariana (1536-1624). Mariana was born near Toledo, of poor and humble parents. He entered the great University of Alcahi in 1553, shone as a student, and a year later was received into the new Society of Jesus. After completing his studies at Alcala, Mariana went to the Jesuit College at Rome in 1561 to teach philosophy and theology, and after four years moved to Sicily to set up the theology programme at the Jesuit college there. In 1569, Mariana moved to teach theology at the great University of Paris, at the remarkably young age of 33. After four years, ill health forced him to retire to live in Toledo; ill health, however, often does not necessarily mean a short life, and Mariana lived to the then phenomenally ripe old age of 88.

 

Fortunately, Mariana's 'retirement' was an active one, and his great learning and erudition drew numerous persons, from private citizens to state and ecclesiastical authorities, to ask for his advice and guidance. He was able to published two great and influential books. One was a history of Spain, written first in Latin and then in Spanish, which went into many volumes and many editions in both languages. The Latin version was eventually published in 11 volumes, and the Spanish in 30. The Spanish edition has long been considered one of the classics of Spanish style, and it went into many editions until the mid-nineteenth century.

 

The other notable work of Mariana, De Rege (On Kingship), was published in 1599, written at the suggestion of King Philip II of Spain and dedicated to his successor Philip III. But monarchy did not fare well at the hands of the hard-hitting Mariana. A fervent opponent of the rising tide of absolutism in Europe, and of the doctrine of such as King James I of England that kings rule absolutely by divine right, Mariana converted the scholastic doctrine of tyranny from an abstract concept into a weapon with which to smite real monarchs of the past. He denounced such ancient rulers as Cyrus the Great, Alexander the Great, and Julius Caesar as tyrants, who acquired their power by injustice and robbery. Previous scholastics, including Suarez, believed that the people could ratify such unjust usurpation by their consent after the fact, and thereby make their rule legitimate. But Mariana was not so quick to concede the consent of the people. In contrast to other scholastics, who placed the 'ownership' of power in the king, he stressed that the people have a right to reclaim their political power whenever the king should abuse it. Indeed Mariana held that, in transferring their original political power from a state of nature to the king, the people necessarily reserved important rights to themselves; in addition to the right to reclaim sovereignty, they retained such vital powers as taxation, the right to veto laws, and the right to determine succession if the king has no heir. It should already be clear that it was Mariana, rather than Suarez, who might be called the forebear of John Locke's theory of popular consent and the continuing superiority of the people to the government. Furthermore, Mariana also anticipated Locke in holding that men leave the state of nature to form governments in order to preserve their rights of private property. Mariana also went far beyond Suarez in postulating a state of nature, a society, previous .to the institution of government.

 

But the most fascinating feature of the 'extremism' of Mariana's political theory was his creative innovation in the scholastic theory of tyrannicide. That a tyrant might be justly killed by the people had long been standard doctrine; but Mariana broadened it greatly in two significant ways. First, he expanded the definition of tyranny: a tyrant was any ruler who violated the laws of religion, who imposed taxes without the people's consent, or who prevented a meeting of a democratic parliament. All the other scholastics, in contrast, had located the sole power to tax in the ruler. Even more spectacularly, to Mariana any individual citizen can justly assassinate a tyrant and may do so by any means necessary. Assassination did not require some sort of collective decision by the entire people. To be sure, Mariana did not think that an individual should engage in assassination lightly. First, he should try to assemble the people to make this crucial decision. But if that is impossible, he should at least consult some 'erudite and grave men', unless the cry of the people against the tyrant is so starkly manifest that consultation becomes unnecessary.

 

 

Furthermore, Mariana added - in phrases anticipating Locke's and the Declaration of Independence's justification of the right of rebellion - that we need not worry about the public order being greatly disrupted by too many people taking up the practice of tyrannicide. For this is a dangerous enterprise, Mariana sensibly pointed out, and very few are ever ready to risk their lives in that way. On the contrary, most tyrants have not died a violent death, and tyrannicides have almost always been greeted by the populace as heroes. In contrast to the common objections to tyrannicide, he concluded, it would be salutary for rulers to fear the people, and to realize that a lapse into tyranny might cause the people to call them to account for their crimes. Mariana has given us an eloquent description of the typical tyrant at his deadly work:

 

He seizes the property of individuals and squanders it, impelled as he is by the unkingly vices of lust, avarice, cruelty, and fraud .... Tyrants, indeed, try to injure and ruin everybody, but they direct their attack especially against rich and upright men throughout the realm. They consider the good more suspect than the evil; and the virtue which they themselves lack is most formidable to them...They expel the better men from the commonwealth on the principle that whatever is exalted in the kingdom should be laid low... They exhaust all the rest so that they can not unite by demanding new tributes from them daily, by stirring up quarrels among the citizens, and by joining war to war. They build huge works at the expense and by the suffering of the citizens. Whence the pyramids of Egypt were born... The tyrant necessarily fears that those whom he terrorizes and holds as slaves will attempt to overthrow him.... Thus he forbids the citizens to congregate together, to meet in assemblies, and to discuss the commonwealth altogether, taking from them by secret-police methods the opportunity of free speaking and freely listening so that they are not even allowed to complain freely

....

 

 

This 'erudite and grave man', Juan de Mariana, left no doubt what he thought of the most recent famous tyrannicide: that of the French King Henry III. In 1588, Henry III had been prepared to name as his successor Henry of Navarre, a Calvinist who would be ruling over a fiercely Catholic nation. Facing a rebellion by the Catholic nobles, headed by the duc de Guise, and backed by the devoted Catholic citizens of Paris, Henry III called the duke and his brother the cardinal to a peace parley into his camp, and then had the two assassinated. The following year, on the point of conquering the city of Paris, Henry III was assassinated in turn, by a young Dominican friar and member of the Catholic League, Jacques Clement. To Mariana, in this way 'blood was expiated with blood' and the duc de Guise was 'avenged with royal blood'. 'Thus perished Clement', concluded Mariana, 'an eternal ornament of France'. The assassination had similarly been hailed by Pope Sixtus V, and by the fiery Catholic preachers of Paris.

 

The French authorities were understandably edgy about Mariana's theories and at his book De Rege. Finally, in 1610, Henry IV (formerly Henry of Navarre, who had converted from Calvinism to the Catholic faith in order to become king of France), was assassinated by the Catholic resister Ravaillac, who despised the religious centrism and the state absolutism imposed by the king. At that point, France erupted in an orgy of indignation against Mariana, and the parlement of Paris had De Rege burned publicly by the hangman. Before executing Ravaillac, the assassin was questioned closely as to whether reading Mariana had driven him to murder, but he denied ever having heard of him. While the king of Spain refused to heed French pleas to suppress this subversive work, the general of the Jesuit Order issued a decree to his society, forbidding them to teach that it is lawful to kill tyrants. This truckling, however, did not prevent a successful smear campaign in France against the Jesuit Order, as well as its loss of political and theological influence.

 

Juan de Mariana possessed one of the most fascinating personalities in the history of political and economic thought. Honest, gutsy and fearless, Mariana was in hot water almost all of his long life, even for his economic writings. Turning his attention to monetary theory and practice, Mariana, in his brief treatise De Monetae Mutatione (On the Alteration ofMoney, 1609) denounced his sovereign, Philip III, for robbing the people and crippling commerce through the debasement of copper coinage. He pointed out that this debasement also added to Spain's chronic price inflation by increasing the quantity of money in the country. Philip had wiped out his public debt by debasing his copper coins by two-thirds, thereby tripling the supply of copper money.

 

Mariana noted that debasement and government tampering with the market value of money could only cause grave economic problems:

 

Only a fool would try to separate these values in such a way that the legal price

should differ from the natural. Foolish, nay, wicked the ruler who orders that a

thing the common people value, let us say, at five should be sold for ten. Men are

guided in this matter by common estimation founded on considerations of the

quality of things, and of their abundance or scarcity. It would be vain for a Prince

to seek to undermine these principles of commerce. 'Tis best to leave them intact

instead of assailing them by force to the public detriment.

 

Mariana begins De Monetae with a charming and candid apologia for writing the book reminiscent of the great Swedish economist Knut Wicksell over two and a half centuries later: he knows that his criticism of the king courted great unpopularity, but everyone is now groaning under the hardships resulting from the debasement, and yet no one has had the courage to criticize the king's action publicly. Hence, justice requires that at least one man Mariana - should move in to express the common grievance publicly. When a combination of fear and bribery conspire to silence critics, there should be at least one man in the country who knows the truth and has the courage to point it out to one and all.

 

Mariana then proceeds to demonstrate that debasement is a very heavy hidden tax on the private property of his subjects, and that, pace his political theory, no king has the right to impose taxes without the consent of the people. Since political power originated with the people, the king has no rights over the private property of his subjects, nor can he appropriate their wealth by his whim and will. Mariana notes the papal bull Coena Domini, which had decreed the excommunication of any ruler who imposes new taxes. Mariana reasons that any king who practises debasement should incur the same punishment, as should any legal monopoly imposed by the state without the consent of the people. Under such monopolies, the state itself, or its grantee, can sell a product to the public at a price higher than its market worth, and this is surely nothing but a tax.

 

Mariana also set forth a history of debasement and its unfortunate effects; and he pointed out that governments are supposed to maintain all standards of weight and measure, not only of money, and that their record in adulterating those standards is most disgraceful. Castile, for example, had changed its measures of oil and wine, in order to levy a hidden tax, and this led to great confusion and popular unrest.

 

Mariana's book attacking the king's debasement of the currency led the monarch to haul the aged (73-year-old) scholar into prison, charging him with the high crime of lese-majeste. The judges convicted Mariana of this crime against the king, but the pope refused to punish him, and Mariana was finally released from prison after four months on the condition that he would cut out the offensive passages in his work, and that he would be more careful in the future.

 

King Philip and his minions, however, did not leave the fate of the book to an eventual change of heart on the part of Mariana. Instead, the king ordered his officials to buy up every published copy of De Monetae Mutatione they could get their hands on and to destroy them. Not only that; after Mariana's death, the Spanish Inquisition expurgated the remaining copies, deleted many sentences and smeared entire pages with ink. All non-expurgated copies were put on the Spanish Index, and these in turn were expurgated during the seventeenth century. As a result of this savage campaign of censorship, the existence of the Latin text of this important booklet remained unknown for 250 years, and was only rediscovered because the Spanish text was incorporated into a nineteenth century collection of classical Spanish essays. Hence, few complete copies of the booklet survive, of which the only one in the United States is in the Boston Public Library.

 

The venerable Mariana was apparently not in enough trouble; after he was jailed by the king, the authorities seized his notes and papers, and found there a manuscript attacking the existing governing powers in the Society of Jesus. An individualist unafraid to think for himself, Mariana clearly took little stock in the Jesuit ideal of the society as a tightly disciplined military-like body. In this booklet, Discurso de las Enfermedades de fa Compania, Molina smote the Jesuit Order fore and aft, its administration and its training of novices, and he judged his superiors in the Jesuit Order unfit to rule. Above all, Mariana criticized the military-like hierarchy; the general, he concluded, has too much power, and the provincials and other Jesuits too little. Jesuits, he asserted, should at least have a voice in the selection of their immediate superiors.

 

When the Jesuit general, Claudius Aquaviva, found that copies of Mariana's work were circulating in a kind of underground samizdat both inside and outside the order, he ordered Mariana to apologize for the scandal. The feisty and principled Mariana, however, refused to do so, and Aquaviva did not press the issue. As soon as Mariana died, the legion of enemies of the Jesuit Order published the Discurso simultaneously in French, Latin and Italian. As in the case of all bureaucratic organizations, the Jesuits then and since were more concerned about the scandal and not washing dirty linen in public than in fostering freedom of inquiry, self-criticism, or correcting any evils that Mariana might have uncovered. 

 

The Jesuit Order never expelled their eminent member nor did he ever leave. Still he was all his life regarded as a feisty trouble-maker, and as unwilling to bow to orders or peer pressure. Father Antonio Astrain, in his history of the Jesuit Order, notes that 'above all we must bear in mind that his [Mariana's] character was very rough and unmortified'.5 Personally, in a manner similar to the Italian Franciscan saints San Bernardino and Sant'Antonino of the fifteenth century, Mariana was ascetic and austere. He never attended the theatre and he held that priests and monks should never degrade their sacred character by listening to actors. He also denounced the popular Spanish sport of bull-fighting, which was also not calculated to increase his popularity. Gloomily, Mariana would often stress that life was short, precarious, and full of vexation. Yet, despite his austerity, Father Juan de Mariana possessed a sparkling, almost Menckenesque, wit. Thus his oneliner on marriage: 'Some one cleverly said that the first and the last day of marriage are desirable, but that the rest are terrible' .

 

But probably his wittiest remark concerned bull-fighting. His attack on that sport met with the objection that some theologians had defended the validity of bull-fighting. Denouncing theologians who palliated crimes by inventing explanations to please the masses, Mariana delivered a line closely anticipating a favourite remark by Ludwig von Mises on economists over three and a half centuries later: 'there is nothing howsoever absurd which is not defended by some theologian' .

Rothbard, em

[3.1] The great depression of the fourteenth century

Most people - historians not excepted - are tempted to think of economic and cultural progress as being continuous: in every century people are better off than in the one preceding. This comforting assumption had to be given up quite early when the Dark Ages ensued after the collapse of the Roman Empire. But it was generally held that after the 'renaissance' of the eleventh century, progress in western Europe was pretty well linear and continuous 

from that point to the present day. 

It took heroic efforts over many decades for economic historians like Professors Armando Sapori and Robert Sabatino Lopez to finally convince the historical profession that there was a grave

secular decline in most of western Europe from approximately 1300 to the

middle of the fifteenth century; a period which might be called the Late

Middle Ages or the Early Renaissance. This secular decline, mistitled a

'depression', permeated most parts of western Europe with the exception of a

few Italian city-states.

The economic decline was marked by a severe drop in population. Since

the eleventh century, economic growth and prosperity had pulled up population

figures. Total population in western Europe, estimated at

24 million in

the year 1000 AD, had vaulted to 54 million by the year 1340. In little over a

century, from 1340 to 1450, however, the western European population fell

from 54 million to 37 million, a 31 per cent drop in only a century.

The successful battle to establish the fact of the great decline has done

little, however, to establish the cause or causes of this debacle. Focus on the

devastation caused by outbreaks of the Black Death in the mid-fourteenth

century is partially correct, but superficial, for these outbreaks were themselves

partly caused by an economic breakdown and fall in living standards

which began earlier in the century. The causes of the great depression of

western Europe can be summed up in one stark phrase: the newly imposed

domination of the state. During the medieval synthesis of the High Middle

Ages there was a balance between the power of Church and state, with the

Church slightly more powerful. In the fourteenth century that balance was

broken, and the nation-state came to hold sway, breaking the power of the

Church, taxing, regulating, controlling and wreaking devastation through

virtually continuous war for over a century (the Hundred Years' War, from

1337 to 1453).1

The first and critically most important step in the rise in the power of the

state at the expense of crippling the economy was the destruction of the fairs

of Champagne. During the High Middle Ages, the fairs of Champagne were

the main mart for international trade, and the hub of local and international

commerce. These fairs had been carefully nurtured by being made free zones,

untaxed or unregulated by the French kings or nobles, while justice was

swiftly and efficiently meted out by competing private and merchants' courts.

68 Economic thought before Adam Smith

The fairs of Champagne reached their peak during the thirteenth century, and

provided the centre for land-based trade over the Alps from northern Italy,

bearing goods from afar.

Then, in the early fourteenth century, Philip IV, the Fair, king of France

(1285-1314), moved to tax, plunder, and effectively destroy the vitally important

fairs of Champagne. To finance his perpetual dynastic wars, Philip

levied a stiff sales tax on the Champagne fairs. He also destroyed domestic

capital and finance by repeated confiscatory levies on groups or organizations

with money. In 1308, he destroyed the wealthy Order of the Templars, confiscating

their funds for the royal treasury. Philip then turned to impose a series

of crippling levies and confiscations on Jews and northern Italians ('Lombards')

prominent at the fairs: in 1306, 1311, 1315, 1320 and 1321. Furthermore, at

war with the Flemings, Philip broke the long-time custom that all merchants

were welcome at the fairs, and decreed the exclusion of the Flemings. The

result of these measures was a rapid and permanent decline of the fairs of

Champagne and of the trading route over the Alps. Desperately, the Italian

city-states began to reconstitute trade routes and sail around the Straits of

Gibraltar to Bruges, which began to flourish even though the rest of Flanders

was in decay.

It was particularly fateful that Philip the Fair inaugurated the system of

regular taxation in France. Before then, there were no regular taxes. In the

medieval era, while the king was supposed to be all-powerful in his own

sphere, that sphere was restricted by the sanctity of private property. The king

was supposed to be an armed enforcer and upholder of the law, and his

revenues were supposed to derive from rents on royal lands, feudal dues and

tolls. There was nothing that we would call regular taxation. In an emergency,

such as an invasion or the launching of a crusade, the prince, in

addition to invoking the feudal duty of fighting on his behalf, might ask his

vassals for a subsidy; but that aid would be requested rather than ordered, and

be limited in duration to the emergency period.

The perpetual wars of the fourteenth and the first half of the fifteenth

centuries began in the 1290s, when Philip the Fair, taking advantage of King

Edward I of England's war with Scotland and Wales, seized the province of

Gascony from England. This launched a continuing warfare between England

and Flanders on the one side, and France on the other, and led to a

desperate need for funds by both the English and the French Crowns.

The merchants and capitalists at the fairs of Champagne might have money,

but the largest and most tempting source for royal plunder was the Catholic

Church. Both the English and French monarchs proceeded to tax the Church,

which brought them into a collision course with the pope. Pope Boniface VIII

(1294-1303) stoutly resisted this new form of pillage, and prohibited the

monarchs from taxing the Church. King Edward reacted by denying justice in

From Middle Ages to Renaissance 69

the royal courts to the Church, while Philip was more militant by prohibiting

the transfer of Church revenue from France to Rome. Boniface was forced to

retreat and to allow the tax, but his bull

Unam Sanctam (1302) insisted that

temporal authority must be subordinate to the spiritual. That was enough for

Philip, who boldly seized the pope in Italy and prepared to try him for heresy,

a trial only cut off by the death of the aged Boniface. At this point Philip the

Fair seized the papacy itself, and brought the seat of the Roman Catholic

Church from Rome to Avignon, where he proceeded to designate the pope

himself. For virtually the entire fourteenth century, the pope, in his 'Babylonian

captivity', was an abject tool of the French king; the pope only returned to

Italy in the early fifteenth century.

In this way, the once mighty Catholic Church, dominant power and spiritual

authority during the High Middle Ages, had been brought low and made

a virtual vassal of the royal plunderer of France.

The decline of Church authority, then, was matched by the rise in the

power of the absolute state. Not content with confiscating, plundering, taxing,

crushing the fairs of Champagne, and bringing the Catholic Church

under his heel, Philip the Fair also obtained revenue for his eternal wars by

debasement of the coinage and thereby generated a secular inflation.

The wars of the fourteenth century did not cause a great deal of

direct

devastation: armies were small and hostilities were intermittent. The main

devastation came from the heavy taxes and from the monetary inflation and

borrowing to finance the eternal royal adventures. The enormous increase of

taxation was the most crippling aspect of the wars. The expenses of war:

recruitment of the modestly sized army; payments of its wages; supplies; and

fortifications - all cost from two- to fourfold the ordinary expenses of the

Crown. Add to that the' high costs of tax assessment and enforcement and the

cost of the loans, and the crippling burden of war taxation becomes all too

clear.

The new taxes were everywhere. We have seen the grave effect of taxes on

the Church; on a large monastic farm, they often absorbed over 40 per cent of

the net profits of the farm. A uniform poll tax of one shilling, levied by the

English Crown in 1380, inflicted great hardship on peasants and craftsmen.

The tax amounted to one month's wages for agricultural workers and one

week's wages for urban labourers; moreover, since many poor workers and

peasants were paid in kind rather than money, amassing the money to pay the

tax was particularly difficult.

Other new taxes levied were

ad valorem on all transactions; taxes on

wholesale and retail beverages; and levies on salt and wool. To combat

evasion of the tax, the governments established monopoly markets for the

sale of salt in France and 'staple points' for English wool. The taxes restricted

supply and raised prices, crippling the critical English wool trade.

70 Economic thought before Adam Smith

Production and trade were hampered further by massive requisitions levied

by the kings, thus causing a drastic fall of income and wealth, as well as

bankruptcies among the producers. In short, consumers suffered from artificially

high prices and producers from low returns, with the king bleeding the

economy of the differential. Government borrowing was scarcely more helpful,

leading to repeated defaults by the kings and consequent heavy losses

and bankruptcies among the private bankers unwise enough to lend to the

government.

Originating as a response to wartime 'emergency', the new taxes tended to

become permanent: not only because the warfare lasted for over a century,

but because the state, always on the lookout for an increase in its income and

power, seized upon the golden opportunity to convert wartime taxes into a

permanent part of the national heritage.

From the middle to the end of the fourteenth century, Europe was struck

with the devastating pandemic of the Black Death - the bubonic plague which

in the short span of

1348-50 wiped out fully one-third of the population.

The Black Death was largely the consequence of people's lowered

living standards caused by the great depression and the resulting ··loss of

resistance to disease. The plague continued to recur, though not in such

virulent form, in every decade of the century.

Such are the great recuperative powers of the human race that this enormous

tragedy caused virtually no lasting catastrophic social or psychological

effects among the European population. In a sense, the longest-lasting ill

effect from the Black Death was the response of the English Crown in

imposing permanent maximum wage control and compulsory labour rationing

upon English society. The sudden decline of population and consequent

doubling of wage rates was met by the government's severe imposition of

maximum wage control in the Ordinance of

1349 and the Statue of Labourers

of 1351. Maximum wage control was established at the behest of the employing

classes: large, middle and small landlords, and master craftsmen, the

former groups in particular alarmed at the rise of agricultural wage rates. The

ordinance and the statute defied economic law by attempting to enforce

maximum wage control at the old pre-plague levels. The inevitable result,

however, was a grave shortage of labour, since at the statutory maximum

wage the demand for labour was enormously greater than the newly scarce

supply.

Every government intervention creates new problems in the course of vain

attempts to solve the old. The government is then confronted with the choice:

pile on new interventions to solve the inexplicable new problems, or repeal

the original intervention. Government's instinct, of course, is to maximize its

wealth and power by adding new interventions. So did the English Statute of

Labourers, which imposed forced labour at the old wage rates for all men in

From Middle Ages to Renaissance 71

England under the age of 60; restricted the mobility of labour, declaring that

the lord of a particular territory had first claim on a man's labour; and made it

a criminal offence for an employer to hire a worker who had left a former

master. In that way, the English government engaged in labour rationing to

try to freeze labourers at their pre-plague occupations at pre-plague wages.

This forced rationing of labour cut against the natural inclination of men to

leave for more employment at better wages, and so the inevitable rise of

black markets for labour made enforcement of the statutes difficult. The

desperate English Crown tried once again, in the Cambridge Statute of 1388,

to make the rationing more rigorous. Labour mobility of any sort was prohibited

without written permission from local justices, and compulsory child

labour was imposed in agriculture. But there was continual evasion of this

compulsory buyers' cartel, especially by large employers, who were particularly

eager and able to pay higher wage rates. The cumbersome English

judicial machinery was totally ineffective in enforcing the legislation, although

the monopolistic urban guilds (monopolies enforced by government)

were able to partially enforce wage control in the cities.

3.2 Absolutism and nominalism: the break-up of Thomism

Along with the rise of the absolute state, theories of absolutism arose and

began to throw natural law doctrines into the shade. The adoption of natural

law theory, after all, meant that the state was bound to limit itself to the

dictates of the natural or the divine law. But new political theorists arose,

asserting the dominance of the temporal over the spiritual, and of the state's

positive law over the natural or divine order.