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Source link: http://archive.mises.org/10908/the-world-of-salamanca/

The World of Salamanca

October 26, 2009 by

The age between the 8th and 16th centuries was a time of amazing advance in every area of knowledge, such as architecture, music, biology, mathematics, astronomy, industry, and — yes — economics. FULL ARTICLE

{ 27 comments }

Paul Stephens October 26, 2009 at 8:18 pm

In his book, “Barcelona,” Robert Hughes described that city-state’s role in Medieval history. They were a large commercial and shipping center for the entire Mediterranean, prior to Venice, and of equal or greater importance. And their scholars were a meeting place of Islamic, Jewish, and Christian scholarship unlike any other. I’m not sure what the connections between Barcelona and Salamanca might have been, but they were probably close.
More recently, Barcelona traders owned or controlled most of the plantations and trade with Cuba at the end of the 19th century. Our “Spanish-American War” was thus directed more against Barcelona than some non-existent “Spanish Empire.”
Weaver’s “The Mainspring of Civilization” has a large section about the Islamic world when Spain was part of it. He claimed that Islamic civilization, based on the Greeks (Aristotle and Neo-Platonism), as well as Jewish scientists and philosophers, was really the “civilized world” of the time, and people traveled and traded freely from Persia to Spain.
Our modern view that Islam is tyrannical and oppressive has little basis in fact. Mohammed even had two Jewish wives, and they never converted to Islam.
I see Christianity as the “mother” and Judaism as the “father” of Islam. Since Mohammed was himself a merchant, and never claimed to be “the son of God” or any such thing, modern Islam is much closer to Judaism, and Christianity is blasphemous because it creates a “second god”.
One of my friends who was in the Peace Corps in Morocco said that the people there called him a “Nazarine”, because he was a follower of Jesus of Nazareth.
Only since the advent of Zionism have we seen the sort of conflicts in the Middle East we see, today. The Crusades had little impact, except to destroy the Byzantine Empire and bring the fruits of Islamic Civilization back to the barbaric tribes of Northern Europe.

Paul Stephens October 26, 2009 at 8:23 pm

Correction: Weaver’s book (distributed by FEE) was “The Mainspring of Human Progress.”

fundamentalist October 27, 2009 at 9:02 am

Lew: “To put it quite simply, it was in the late Middle Ages that there appeared to be something to study at all.”

Actually, that’s true only for Europe. The fascinating aspect of economic history is that the Chinese, India and the Ottoman Empire were far ahead of Europe in terms of science, trade and wealth until roughly 1700. So why didn’t those cultures develop the same ideas that the Scholastics developed?

Abhilash Nambiar October 27, 2009 at 10:26 am

fundamentalist

The fascinating aspect of economic history is that the Chinese, India and the Ottoman Empire were far ahead of Europe in terms of science, trade and wealth until roughly 1700. So why didn’t those cultures develop the same ideas that the Scholastics developed?

Because due to historical accidents, Europeans realized the importance of Capital Accumulation before anybody else did. It is debatable the extent to which they benefited from that knowledge. Despite its achievements, it has never held popular appeal and has been suppressed and/or lost many times.

Mike October 27, 2009 at 11:19 am

fundamentalist,

It may be that the Scholastics were responding to the condemnations of usury and all the bizarre theories of “just price” that were the zeitgeist of their own time and place, artifacts of Church domination. If the East functioned smoothly without these impediments, then they may not have seen the impediments as worth studying.

fundamentalist October 27, 2009 at 11:50 am

Strange that almost few economists have asked why Europe developed capitalism when China, India or the Ottoman Empire had all of the advantages. Mises answers it in “Economic Freedom and Interventionism” on pages 37, 38:

“What separates the West from Eas is precisely the idea which social reformers ridicule as the “sanctity” of property, and which has not penetrated the Orient at all.* Capitalistic saving and investment cannot develop in lands where it is generally believed that the wealth of the businessman causes the poverty of the many, and where the successful trader is sacrificed to the predatory desires of the rules and their representatives.”

“*A rigid system of privilege and castes prevailed for centuries in China and Japan; wealth was a question of rank, and the common man had little opportunity to improve his situation. Savings in Japan and the other nations of the Pacific Rim are a relatively recent development.”

Also, on page 275:

“The legal foundations of Western civilization and prosperity were provided by the institution of private property. What separates Eas and West is precisely the fact that the Orient did not develop the ideological, legal, and political framework within which property rights and their efficacious protection against arbitrariness on the part of rulers could thrive.”

“The vital principle of a liberal constitution is the independence of the judiciary that protects the individual and his property against any violator, whether king or common robber.”

In spite of the great economics of the Late Scholastics, their ideas remained just ideas and capitalism didn’t appear in the world until the Dutch Republic created the independent judiciary required for it to work. The nobility of Europe had used judges and the legal system to steal what ever they wanted.

All of this came about because of the sanctity of private property in the Bible and therefore in Christianity. That attitude toward property exists only in Christianity.

Kara October 27, 2009 at 12:23 pm

All of this came about because of the sanctity of private property in the Bible and therefore in Christianity. That attitude toward property exists only in Christianity.

fundamentalist, that comes off as a non sequitur. Care to support it?

Mike October 27, 2009 at 12:30 pm

I’d be curious to see an in-depth history of the successful regions during their periods of success. It’s been my understanding that many of these Eastern empires were prosperous for a century or a few, then went back to the ways of misery.

I believe in cause and effect. A civilization does not just stumble upon a Golden Age. I suspect that during the prosperity periods, there may have been in place a system where people mostly got to keep what they had, even if it wasn’t called “property” per se.

This is all purely a hunch. Like I said, I’d be curious to see these histories; at any rate a “property-like” system would be something to look out for.

Abhilash Nambiar October 27, 2009 at 12:34 pm

fundamentalist is trying to corrupt the principled discipline of economics with his bizarre theology. I have seen this consistent pattern with him.

fundamentalist October 27, 2009 at 1:16 pm

Kara: “that comes off as a non sequitur.”

I’m not certain why it seems a non sequitur.

Lew wrote: “Molina’s defense of private property rested on the belief that property is secured in the commandment, “thou shalt not steal.” But he went beyond his contemporaries by making strong practical arguments as well.”

As Mises wrote, the East didn’t develop the ideological foundations for the institutions to protect property. Capitalism is based on the institutions that protect the sanctity of private property, especially the institution of an independent judiciary. The Church has always taught the sanctity of property. Molina didn’t invent a new doctrine. But the Church never forced the state to create the institutions to protect property because it still carried traditional views about economics. And in spite of the brilliance of the Spanish Scholastics, Spain never created them either. Christianity provided the missing ideology to support private property.

The first nation to create those institutions was the Dutch Republic, whose leading economic thinkers were descendants of the Scholastics. As New Institutional economics teaches, institutions are the product of culture, the major component of which is religion.

The Scholastics and the Dutch weren’t thinking in terms of economic development. They didn’t know such a thing was possible. The Scholastics were moral philosophers attempting to organize society in a moral way, which for them would be according to Biblical principles. The Dutch were merely trying to implement the teachings of the Scholastics. Unwittingly they created capitalism.

I’m not as familiar with China and India as with the Ottoman’s, but Ottoman’s had the traditional European attitude toward commerce: it was for people of very low rank and thus despised. In the Ottoman Empire, the paths to success were in the state bureaucracy or the military where they could steal from the people with impunity. Jews and Christians were forbidden entrance to either the state or the military, so they had to concentrate on commerce. On a regular basis, they would become very wealthy, at which point the state would allow the Muslim community to plunder their wealth and murder anyone who resisted. The Ottoman Empire was far wealthier than Western Europe in the 16th century, but its wealth came from conquering and plundering, like the Romans.

fundamentalist October 27, 2009 at 1:44 pm

The Late Scholastics were moral philosophers, concerned almost exclusively with creating a moral society. Over a century, the Spanish Empire became poorer and the Dutch Republic extremely wealthy without having conquered another empire. Heads of state and their thugs wondered how that could be. Spain had all of the gold it stole from the Americas. The Dutch had nothing but reclaimed swamp land. Mercantilism arose in response to that paradox, but most mercantilist writers got it all wrong. Nevertheless, mercantilist thought changed the sphere of economics from morality to wealth. All kings wanted to know how the Dutch had become so wealthy without a king and without plundering other nations.

fundamentalist October 27, 2009 at 1:54 pm

Kara, you may be asking how the Dutch managed to create the necessary institutions when no one else in Europe or the rest of the world had. I think the answer is in the massive death and destruction of the Reformation period. Christians had never challenged the authority of the state until kings began to murder Protestants by the thousands. The tract that justified tyrranicide was written by French Hugenots in the midst of severe persecution. Also, the Dutch suffered mass murder by the Spanish troops in the Netherlands as the King of Spain tried to kill all Protestants. The Dutch war for independence lasted 80 years.

The Dutch tried to maintain a traditional government by begging first a French nobleman and then Queen Elizabeth to rule over them. But fear of Spain made them decline. The Dutch chose a republican form of government out of necessity, not desire. The massive upheavels of the Reformation caused the Dutch to rethink a lot of tradition and try new things. They were amazingly inventive. They revolutionized warfare and their tactics enabled Vienna to defeat the Ottomans.

A good book on their reorganization of society is “The Disciplinary Revolution.” I can’t remember the author, but he wrote that the Dutch Republic was an experiment in re-organizing society along Biblical and rational lines.

Nate Y October 27, 2009 at 2:23 pm

“fundamentalist is trying to corrupt the principled discipline of economics with his bizarre theology. I have seen this consistent pattern with him.”

I must agree with this.

I mean, even if the Bible is the source for the “sanctity of private property” it would only follow that Christianity is as well if the idea only appered in the New Testament. But it doesn’t. “Thou Shall Not Steal” appears in Exodus. No Christ in there. Fundamentalist better convert to Judiasm with the quickness.

Also, even if Jesus gave a “private property sermon on the mount” it would do essentially nothing to dignify any of the other truth claims of the Bible/Christianity. All we could say was something like “Jesus was right about the virtues of private property” and then carry on with our lives.

Mr Eko October 27, 2009 at 2:57 pm

Nate Y,

*The NT is filled with the word “law”.
*The Apostle Paul reaffirms the 10 Commandments in his letter to the Romans.
*The Apostle Paul writes that the OT is still valid in his letter to Timothy.
*And just for fun, read Capitalism and the New Testament (linked)

http://www.lewrockwell.com/orig9/frankowski1.html

Fundamentalist can stay a Christian.

fundamentalist October 27, 2009 at 3:52 pm

Nate: “Fundamentalist better convert to Judiasm with the quickness.”

You’re right that the sanctity of property is also a component of Judaism. The Jews might have created capitalism if given half a chance by Europe and the Ottoman Empire.

Nate: “Also, even if Jesus gave a “private property sermon on the mount” it would do essentially nothing to dignify any of the other truth claims of the Bible/Christianity.”

All I was pointing out is that the respect for private property is the ideology necessary for the creation of the institutions of capitalism. Western European Christianity held that ideology when almost no one else did. That’s why capitalism originated in Christian Western Europe and not in the more advanced states of China, India or the Ottoman Empire.

Nate Y October 27, 2009 at 6:32 pm

Mr. Eko,

All of that is irrelevant. As was explictly stated, I was arguing against the idea that Christianity is the SOURCE of the “sanctity of private property” which it can’t be since the commandment “Thou shall not steal” appears in the Old Testament. That is, the sanctity of private property predates Christianity. Therefore, Christianity cannot be the source of the sanctity of private property. Sure, Christianity can carry on the tradition and it does (as your bullet points illustrate) but it is not the source. It cannot be. In fact, if one is to argue that the right to property is a “natural right” then it predates, and exists independent of, all religion. Uh oh…that one could get me in trouble.

fundamentalist,

First you say “All of this came about because of the sanctity of private property in the Bible and therefore in Christianity. That attitude toward property exists ONLY in Christianity.” (emphasis mine)

Now you say “All I was pointing out is that the respect for private property is the ideology necessary for the creation of the institutions of capitalism. Western European Christianity held that ideology when almost no one else did.”

So was it only Christianity or almost only Western European Christianity? I find this a little unfair. Your first post most definitely comes across as an attempt to elevate Christianity’s contribution (whatever that may be) higher than necessary. As evidenced by the reactions of myself and a couple others on this board.

Anyway, this is really no biggie. I just sometimes find these little rhetorical arguments to be entertaining. I think you’re confused about the origins of capitalism but meh.

Bruce Koerber October 27, 2009 at 7:58 pm

http://economicsandreligion.blogspot.com/
Tuesday, October 27, 2009

The Great Creative Mindset – Harmony Of Science And Religion.

Thank you Lew for your eloquent, quick rendition of the Salamanca contribution to classical liberalism.

I think it is very fruitful to explore the truth with a mindset that is anchored with the harmony of science and religion. Then when an idea bubbles to the surface the anchor can be raised and the craft is free to begin the journey to see where the currents and the winds lead.

At any point the anchor of the harmony of science and religion can be used; to rest and analyze and theorize.

fundamentalist October 27, 2009 at 8:12 pm

Nate: “So was it only Christianity or almost only Western European Christianity? ”

Why don’t you spend a little time trying to understand what people are saying instead of fabricating minor contradictions?

I never wrote that Christianity invented the concept of property. That’s purely in your fevered imagination. The concept of private property predates even the Bible. But that doesn’t change the fact that the Bible sanctifies private property in a way that other religions and philosophies do not. And at the time the Scholastics came up with their logic on free markets, no philosophy or religion or culture in the entire world gave any place at all to private property.

The OT is part of Christianity as well as Judaism, so Christians can take credit for the high respect for private property in the West.

I would challenge you to show me any philosophy or religion that elevates property the way Christianity does. Only Rothbard’s ethic attempts it, but he didn’t come up with his system until about 50 years ago and it has had very little impact on the world. I don’t think It’s possible to overstate Christianity’s contribution to liberty through its stance on property.

Observer October 27, 2009 at 8:22 pm

“Mohammed even had two Jewish wives, and they never converted to Islam.”

If I had multiple wives I’m sure I’d be apathetic toward their religious preference, as well.

Abhilash Nambiar October 27, 2009 at 9:04 pm

fundamentalist

‘I would challenge you to show me any philosophy or religion that elevates property the way Christianity does.’

OK fundamentalist, time to quote Walter Lippmann here. He was a famous journalist you know:

The facts we see depend on where we are placed and the habits of our eyes.

You are sensitive to those passages in the Bible that condone private property because private property is high on your value scale. But the Bible is packed with enough versatility for every almost every crowd under almost any circumstance. I have not met any person who calls themselves Christian who think they are doing something forbidden by their religion.

On the other hand it is easier to detect a Bhai or Muslim who is not adhering to his faith, because his books speak with simplicity and little ambiguity and fewer internal inconsistencies.

In the Western world Christians will use the Bible to defend private property, although I am not sure that is the dominant trend these days. There are the neo-cons that Lew is criticizing, mostly though not entirely Christian. In the non-Western world other aspects of Christianity could be emphasized. Ones people there find more favorable. Christianity has not brought capitalistic style prosperity to Philippines, Ethiopia or Latin America. Christianity can do with or without capitalism.

So yes you can keep Christian cake and eat capitalism too.

Vitor October 27, 2009 at 9:40 pm

Well, two things that limited the development of Islam, besides the internal struggles, were:

1 – Didn’t developed banking with the same intensity of Europe, economical freedom in Islam was better than some places for some centuries, but it wasn’t perfect and with time they lost their edge and couldn’t catch up for many reasons (including religious/social stuff).

2 – Lack of scientific methodology and organization. Although there were a lot of muslims who did considerable studies about the natural world, they never organized their knowledge in a systematic way like Newton and Galileu did, their math were good but couldn’t advance much on what the Indians already achieved.

fundamentalist October 27, 2009 at 9:49 pm

Abhilash, In case you didn’t notice, you completely ignored my challenge.

Abhilash: “…the Bible is packed with enough versatility for every almost every crowd under almost any circumstance.”

That’s simply not true. Dishonest people can make any speech or writing say whatever they want it to say. Honest people who follow reason won’t even try. Rules of logic, honesty and reason exist for interpreting any piece of communication, and when used to interpret the Bible, it is very clear.

Abhilash: “I have not met any person who calls themselves Christian who think they are doing something forbidden by their religion.”

That doesn’t even make sense.

Abhilash: “On the other hand it is easier to detect a Bhai or Muslim who is not adhering to his faith, because his books speak with simplicity and little ambiguity and fewer internal inconsistencies.”

So why are they all fighting over the proper interpretations of the Koran and what true Islam is? To deny the many factions in Islam is just dishonest.

Abhilash: “Christianity has not brought capitalistic style prosperity to Philippines, Ethiopia or Latin America.”

Actually, that’s a very good point. It’s very sad that after the brilliant scholarship of the late Scholastics, the Catholic Church decided to turn against its own doctrines and oppose free markets. I would guess the Church did so because it identified free markets with Protestantism. The Catholic Church’s betrayal of its own principles is the reason for the poverty of Catholic dominated countries. Fortunately, we have organizations like the Acton Institute trying to heal the Church’s blindness.

Abhilash Nambiar October 27, 2009 at 10:23 pm

Oh fundamentalist, agreeing with my conclusion but questioning the deductive method with which I arrived at it!! I suppose you might make a good economist, but a crazy theologian. Never mind though, maybe I am the crazy one. It is tough to be libertarian and not be called crazy anyway.

I have not ignored your challenge fundamentalist. Christian theology bends to the bias of person trying to understand it. Even if the bias is towards believing that the book is unambiguous and clear of inconsistencies.

Because of that, let me repeat, because of that I think it is easier to be a Christian and a capitalist at the same time rather than be a Muslim or a Hindu and be a capitalist. However it could also have something to do with the fact that Christian theology matured in the Western world where private property was held in high regard to begin with.

But theology tends to evolve with time, despite claims of being absolute. I am sure in the near future theologians are going to discover that private property was sanctified in the Quran and Bhagavat Gita after all and people where mislead into not recognizing it or something along the line.

So you see there is no simple way to approach your challenge. Oh and by the way, I do have the fullest respect for the achievements of the late scholastic scholars who where the fore-runner to the Austrian school. But respect for their achievements as human beings. All people I respect have some weakness or the other, myself included. We are only human.

fundamentalist October 28, 2009 at 8:20 am

Abhilash: “I have not ignored your challenge…”

Yes you have. I’ll repeat it: ‘I would challenge you to show me any philosophy or religion that elevates property the way Christianity does.’

Instead of showing me a system that elevates property, you have merely tried to explain away Christianity’s high respect for property.

Abhilash: “it could also have something to do with the fact that Christian theology matured in the Western world where private property was held in high regard to begin with.”

But most of Christianity’s doctrine on property come from the OT, especially the Torah, which was written about 1,500 BC by a Middle Eastern prophet. Not much evolving going on there.

Abhilash: “I am sure in the near future theologians are going to discover that private property was sanctified in the Quran and Bhagavat Gita after all and people where mislead into not recognizing it or something along the line.”

You’re certain of the, huh? Even though Islam is 1,400 years old and Hinduism much older than even Judaism? Judaism came up with it 3,500 years ago. I would say that Muslims and Hindus are very slow learners. Also, in the past two decades conservative Muslims have identified socialism as the true economics of Islam, following in the footsteps of Iran’s Khomeini, even though he was Shia and most of conservative Islam is Sunni.

Abhilash: “So you see there is no simple way to approach your challenge.”

What you mean is it’s difficult for you to dodge the obvious.

Abhilash Nambiar October 28, 2009 at 8:31 pm

Dear fundamentalist

You are putting words into my mouth. You are asking a twisted question and demanding a straight answer. And when I refuse and instead offer a detailed clarification. You call it a dodge. I have explained myself and won’t do it again.

You seem to be almost implying that private property rights are a middle eastern idea. Yeah right. Private property gained significance only in the branch of Christianity that dominated the Western world. It is through Western eyes that we are seeking the this religion’s Middle Eastern roots.

Yes, religions do evolve. Religions have evolved, more rapidly these days than ever before. How resistant they where to change in the past can become irrelevant when the environment in which they evolved perviously changed and that too in such short time suddenly.

There is even an example in history. Japan went from being closed theocratic society with a king god, ruling the country from 660 BC to a free market capitalistic society within a span of decades. The major sudden change was the first successful occupation by a foreign power. They did not need Christianity to embrace capitalism. Their own ethical/religious system (a mixture of Buddhism and Shintoism) assimilated it in a uniquely Japanese way. Now they are the second largest economy in the world.

And if you look today, the major growing economies of the world India and China are also not majority Christian. But on the other hand in majority Christian nations capitalism has suffered a set back, both Western and otherwise. Yes, it is pretty obvious religions evolve as people’s needs evolve.

Take even the case of Catholicism. Jesuit scholars where the fore-runners for good and proper economics, yet the Catholic church of today is clueless and displeased about the free market. This from the Pope who is supposedly infallible:

http://mises.org/daily/3594

This from an organization that helped undermine communism!!

I have not touched on Islam. But if I am right you should expect to seem tremendous economic progress in Turkey, Palestine, Iran, Iraq, Afghanistan and Pakistan in the near future. I will give it about five years, certainly not more than a decade.

Peter October 28, 2009 at 9:58 pm

Judaism came up with it 3,500 years ago.

And then Jews, and Christians (and Muslims) all ignored it for then next 3200 years or so, until the Dutch started paying attention? I would say that Jews and Christians are very slow learners.

fundamentalist October 29, 2009 at 9:32 am

Abhilash: “But if I am right you should expect to seem tremendous economic progress in Turkey, Palestine, Iran, Iraq, Afghanistan and Pakistan in the near future.”

I would agree with you on Turkey. It has already enjoyed significant growth since abandoning socialism. But the others are overwhelmed with radical Islam, which has adopted socialism at the true Islamic economics. Iran is a very socialist state. As a result, the per capita income in Iran is today 1/4 of what it was under the Shah. Saudi Arabia is also much poorer on a per capita basis than it was 25 years ago.

Peter: “I would say that Jews and Christians are very slow learners.”

Good point. Makes one wonder why Jews and Christians don’t follow their own books. Property rights died with the monarchy in ancient Israel and never were revived. Christians followed traditional attitudes toward property and commerce until the Dutch Republic. But the Dutch didn’t discovere anything new. The rest of Christianity simply ignored the Biblical teachings on property.

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