What caused the gradual decline of the Spanish colonial empire in the seventeenth and eighteenth centuries? A post I read claimed that the Spanish overestimated their wealth, and my teacher pointed out to me that "nobody liked them". To what extent are these claims true, and what were some other reasons? Thanks!
It is commonly accepted that the Spanish Empire, which rose to the pinnacle of its strength under Charles V/I and Philip II was in decline by early seventeenth century and, in spite (or perhaps because?) of strenuous efforts to arrest and reverse that decline during the early 17th century, it declined and by 1643 or 1659 (not random dates..) it was a shadow of its former self.
This view was developed and greatly popularized by John Huxtable Elliott in an influential 1961 paper whose first paragraph I cannot resist reproducing:
This has been the standard approach in modern historiography, as far as I can tell; it and in fact it was espoused already in the 17th century by contemporary pundits and columnists who were then called Arbitristas.
Of course this paradigm found an able challenger in Henry Kamen who argued in an interesting paper that paradoxically, Spain did not decline because it never actually rose economically. Instead, he asserted:
Kamen's paper is great reading but I personally am more convinced by J. Israel's rebuttal that re-asserts the traditional picture I have outlined above.
A recent paper ("The decline of Spain (1500–1850): conjectural estimates") proposes quantitative measurements of Spanish economic performance and arrives at this conclusion:
While couched in mild language, their view is compatible with the standard thesis.
As for the dates, 1643 is the year of the battle of Rocroi which not only wiped out a veteran Spanish army but also Spain's enduring reputation for having the finest military tradition in Europe. 1659 is the year of the Peace of the Pyrenees which showed up Spain's great weakness relative to its chief opponent of the time, France.
Now to the possible causes. First of all, your teacher had two good points. I'll try to expound on them and also on what I think are other possible causes of Spanish decline. One must bear in mind, however, that no one cause can be singled out as the cardinal reason for decline; rather, it was a combination, often mutually reinforcing, of these causes that brought Spain down. The list below is my own and I take full responsibility for its errors and misconceptions:
Another relevant point - and I am going on a bit of a limb here - is that it took a number of generations for the deleterious effects of the expulsions to be truly felt. This reminds me of Stalins's purges (in the wider sense) in the 1920s-1950s which deprived Russia of its best and brightest - it can be argued that the modern-day problems of Russia can be traced back to that qualitative and quantitative dent Stalin made. But let's return to Spain.
In other words, Spain fell into a sort of Dutch Disease (the ironies of history). Of course, this is also true for American silver and gold - this matter was touched on in the post you mentioned. With bullion flowing from the colonies, Spain had little incentive to develop its industry and commerce and to create a solid and healthy taxable base.
Such a world-hugging enterprise was nearly invincible when operating in concord. But with the Dutch Revolt a crucial leg was sawed from under it and the empire lost a great proportion of its best merchants, artisans and soldiers. Even worse, they became its worst enemies and from that point on the continuous futile attempts to reconquer the Dutch consumed most of the Empire's attentions and resources. Since the latter were usually borrowed (see n.2 and n.3) they were wont to fail at the crucial moment. For example, time after time the Spanish victories in the Netherlands were squandered as a result of mutinies which occurred when the King could no longer pay. Of course, the ready expedient of letting them plunder and pillage just served to stiffen the Dutch resistance.
To sum it up: to me it seems that as soon as the Dutch Revolt broke out, the empire became a house divided against itself - and it could not stand.
What is perhaps less well-known is that the 80 Years War included a twelve-year respite during which Spain and the Dutch were at peace. Possibly the decision to renew the war in 1621 was the single worst decision Spain took - the King and his advisers did not realize that by this point they could no longer win.
Ironically, the truce served to highlight just how much economically dependent was Spain on the Netherlands. A quote from Israel's article also ties this up with the other points given above:
So, if even the Pope was against the Spanish Empire, are we to wonder that it aroused so much hostility, just because it was so big and menacing?
A proximate cause of the Spanish empire was the Netherlands War of Independence (which lasted 80 years), and other revolts against Spain. http://en.wikipedia.org/wiki/Eighty_Years%27_War
The Spanish Empire had been "cobbled" together in the late 15th and early 16th centuries by the marriage of Ferdinand of Aragon and Isabella of Castile, whose daughter Juana married Philip, the son of Maximilian of Austria and Marie of Burgundy (who lost that province to France, but kept the Netherlands including modern Belgium). Charles V, the son of Juana and Philip, inherited Spain, the Netherlands and Austria. But when he subdivided it, the Netherlands went together with Spain to Charles' son Philip, instead of to Charles brother Ferdinand, who got Austria and Bohemia and the Holy Roman Empire.
The Netherlands rebelled against Philip and later Spanish rulers, so it became a major liability, instead of a major asset, especially since the war dragged on for 80 years, (with some breaks), during which Spain went bankrupt several times. Philip had annexed Portugal in 1580, but that rebelled in 1640 and broke away. Even Catalonia (part of the old Aragon) rebelled in the middle of the 17th century, although Spain managed to hang on to it. But fighting all these wars, plus a short but costly "Armada" war with England set Spain on a downward spiral through the 17th and 18th centuries.
One of the main reasons was that Spanish empire was too large to control. After Napoleonic wars (and earlier against England) the Spain had lots of interior problems and this was more important than colonies. That's why most of them gained independence.
I totally disagree that "nobody liked Spanish". It might have been in 16th or 17th century, but not in 19th. Spain was Great Britain's ally against Napoleon. The Ostend Manifesto ended in great scandal and was denounced by Powers.
and article 8:
This was after Spanish defeat during the war against the USA (you might want to read my answer to similar question). I think this last article was put on British demand.