Silver from Potosí paid for it all — until the bills came due. In a single lifetime, Spain went from a cluster of squabbling kingdoms to the first global empire in history, ruling lands on every continent. It spent the next three centuries spending the proceeds, and the world has been living with the consequences ever since.
The empire in images
The rise
The hinge year was 1492. In January, Ferdinand and Isabella took Granada, ending nearly eight centuries of Muslim rule in Iberia; in October, a Genoese captain in their service named Christopher Columbus stumbled onto the Caribbean. Within a generation, conquistadors — Cortés in Mexico, Pizarro in Peru — had toppled two American empires with a few hundred men, steel, horses, and smallpox.
Then came the silver. In 1545 the Spanish discovered the mountain of Potosí in today's Bolivia — the richest silver deposit ever found — and for two centuries a river of American silver flowed into Seville: some 16,000 tons of it, financing armies, palaces, and the Escorial. Spain became the treasury of Europe, and the peso — the piece of eight — became the world's first global currency, accepted from Manila to Moscow.
The zenith
Under Philip II (r. 1556–1598), the empire reached a scale no one had seen. In 1580 Philip inherited the Portuguese crown, uniting the two great maritime empires — for sixty years, one king ruled from Mexico to Macao. The Manila galleons linked Asia to the Americas across the Pacific; the tercios, Spain's disciplined infantry, were the finest soldiers in Europe; and Madrid dictated the politics of half the world.
It was a golden age in more than bullion. Cervantes wrote Don Quixote, Velázquez painted the court, and Spanish became the language of administration across two continents. The empire ran on paperwork — the Council of the Indies in Seville processed a transoceanic bureaucracy of staggering detail — proving that empires are built as much by clerks as by conquistadors.
The fall
The rot set in early. The Armada's destruction in 1588 announced that England could challenge Spain at sea; the flood of silver caused ruinous inflation at home — the first great resource curse — while the crown spent it all on endless European wars. By the seventeenth century Spain was the sick man of Europe, rich in colonies and poor in everything else, importing manufactured goods it could no longer make.
The nineteenth century finished the job. Napoleon's invasion shattered Spanish authority, and between 1810 and 1826 Bolívar, San Martín, and their fellow liberators freed nearly all of Spanish America. What remained — Cuba, Puerto Rico, the Philippines — was lost in 1898, when the United States took them in the Spanish-American War. Four centuries after Columbus, the empire was reduced to the peninsula.
The legacy
The empire's deepest legacy is a language. Some 500 million people speak Spanish today, from Madrid to Mexico City to Manila's fading corners — the second most-spoken native language on earth. Catholicism, the plaza-centered city, the hacienda, the mestizo cultures of the Americas: the Spanish empire redrew the human map of half the planet, and the lines are still visible.
It also left the original cautionary tale about easy money. Spain imported so much silver that it destroyed its own industry — economists still cite the “Dutch disease” by another name, but Spain caught it first. Empires, it turns out, can die of wealth as surely as of poverty.
Spain spent American silver to fight European wars for three centuries, and ended with neither the silver nor the wars won. The bills, as promised, came due.