Ferdinand and Isabella were the last of the Trastamaras, and a native dynasty would never again rule Spain. When their sole male heir, John, who was to have inherited all his parent's crowns, died in 1497, the succession to the throne passed to Juana, John's sister. But Juana had become the wife of Philip the Handsome, heir through his father, Emperor Maximilian I, to the Hapsburg patrimony. On Ferdinand's death in 1516, Charles of Ghent, the son of Juana and Philip, inherited Spain (which he ruled as Charles I, r. 1516-56), its colonies, and Naples. (Juana, called Juana Loca or Joanna the Mad, lived until 1555 but was judged incompetent to rule.) When Maximilian I died in 1519, Charles also inherited the Hapsburg domains in Germany. Shortly afterward he was selected Holy Roman emperor, a title that he had held as Charles V (r. 1519-56), to succeed his grandfather. Charles, in only a few years, was able to bring together the world's most diverse empire since Rome (see fig. 3).

Charles's closest attachment was to his birthplace, Flanders; he surrounded himself with Flemish advisers who were not appreciated in Spain. His duties as both Holy Roman emperor and king of Spain, moreover, never allowed him to tarry in one place. As the years of his long reign passed, however, Charles moved closer to Spain and called upon its manpower and colonial wealth to maintain the Hapsburg empire.

When he abdicated in 1556 to retire to a Spanish monastery, Charles divided his empire. His son, Philip II (r. 1556-98), inherited Spain, the Italian possessions, and the Netherlands (the industrial heartland of Europe in the mid-sixteenth century). For a brief period (1554-58), Philip was also king of England as the husband of Mary Tudor (Mary I). In 1580 Philip inherited the throne of Portugal through his mother, and the Iberian Peninsula had a single monarch for the next sixty years.

Philip II was a Castilian by education and temperament. He was seldom out of Spain, and he spoke only Spanish. He governed his scattered dominions through a system of councils, such as the Council of the Indies, which were staffed by professional civil servants whose activities were coordinated by the Council of State, which was responsible to Philip. The Council of State's function was only advisory. Every decision was Philip's; every question required his answer; every document needed his signature. His father had been a peripatetic emperor, but Philip, a royal bureaucrat, administered every detail of his empire from El Escorial, the forbidding palace-monastery-mausoleum on the barren plain outside Madrid.

By marrying Ferdinand, Isabella had united Spain; however, she had also inevitably involved Castile in Aragon's wars in Italy against France, which had formerly been Castile's ally. The motivation in each of their children's marriages had been to circle France with Spanish allies--Habsburg, Burgundian, and English. The succession to the Spanish crown of the Habsburg dynasty, which had broader continental interests and commitments, drew Spain onto the center stage of European dynastic wars for 200 years.

Well into the seventeenth century, music, art, literature, theater, dress, and manners from Spain's Golden Age were admired and imitated; they set a standard by which the rest of Europe measured its culture. Spain was also Europe's preeminent military power, with occasion to exercise its strength on many fronts--on land in Italy, Germany, North Africa, and the Netherlands, and at sea against the Dutch, French, Turks, and English. Spain was the military and diplomatic standard-bearer of the CounterReformation . Spanish fleets defeated the Turks at Malta (1565) and at Lepanto (1572)--events celebrated even in hostile England. These victories prevented the Mediterranean from becoming an Ottoman lake. The defeat of the Grand Armada in 1588 averted the planned invasion of England but was not a permanent setback for the Spanish fleet, which recovered and continued to be an effective naval force in European waters.

Sixteenth-century Spain was ultimately the victim of its own wealth. Military expenditure did not stimulate domestic production. Bullion from American mines passed through Spain like water through a sieve to pay for troops in the Netherlands and Italy, to maintain the emperor's forces in Germany and ships at sea, and to satisfy conspicuous consumption at home. The glut of precious metal brought from America and spent on Spain's military establishment quickened inflation throughout Europe, left Spaniards without sufficient specie to pay debts, and caused Spanish goods to become too overpriced to compete in international markets.

American bullion alone could not satisfy the demands of military expenditure. Domestic production was heavily taxed, driving up prices for Spanish-made goods. The sale of titles to entrepreneurs who bought their way up the social ladder, removing themselves from the productive sector of the economy and padding an increasingly parasitic aristocracy, provided additional funds. Potential profit from the sale of property served as an incentive for further confiscations from Conversos and Moriscos.

Spain's apparent prosperity in the sixteenth century was not based on actual economic growth. As its bullion supply decreased in the seventeenth century, Spain was neither able to meet the cost of its military commitments nor to pay for imports of manufactured goods that could not be produced efficiently at home. The overall effect of plague and emigration reduced Spain's population from 8 million in the early sixteenth century to 7 million by the mid-seventeenth century. Land was taken out of production for lack of labor and the incentive to develop it, and Spain, although predominantly agrarian, depended on imports of foodstuffs.

Data as of December 1988