is excerpted from An
Austrian Perspective on the History of Economic Thought,
vol. 1, Economic Thought Before Adam Smith. An audio
version of this Mises Daily, read by Jeff Riggenbach, is available
By the 12th
century, the Italian city-states had evolved a new form of government,
new at least since ancient Greece. Instead of the usual hereditary
monarch as feudal overlord, basing his rule on a network of feudal
dominion over land areas, the Italian city-states became republics.
The commercial oligarchs who constituted the ruling elite of the
city-state would elect as ruler a salaried bureaucratic official
or podesta, whose term of office was short, and who therefore
ruled at the pleasure of the oligarchy. This city-republican form
of government began at Pisa in 1085, and had swept northern Italy
by the end of the 12th century.
Since the age
of Charlemagne in the 9th century, the German – or "Holy
Roman" – emperors were legally supposed to be rulers of
northern Italy. For several centuries, however, this rule was merely
pro forma, and the city-states were de facto independent.
By the mid-12th century, the Italian city-states were the most prosperous
countries in Europe. Prosperity meant the standing temptation of
wealth to loot, and so the German emperors, beginning with Frederick
Barbarossa in 1154, began a two-centuries-long series of attempts
to conquer the northern Italian cities. The incursions came to an
end with the resounding defeat of Emperor Henry VII’s expedition
of 1310–13, followed by the abject withdrawal and dissolution
of the imperial army of Louis of Bavaria in 1327.
In the course
of this chronic struggle, legal and political theorists arose in
Italy to give voice to an eventually successful Italian determination
to resist the encroachment of the German monarchs. They evolved
the idea of the right of nations to resist imperial attempts at
conquest by other states – what would later be called the right
of national independence, or "self-government" or "national
two centuries of conflict, the major ally of the Italian city-states
against the German empire was the pope, who in that era was able
to put papal armies into the field. As the papal armies helped the
cities roll back the emperor’s forces during the 13th century, the
city-states found to their growing chagrin that the pope was beginning
to assert temporal power over northern Italy. And those claims could
be backed up by the papal armies occupying large sections of the
For a while,
some theorists toyed with the idea of reversing Italian policy and
submitting to the German emperor in order to rid themselves of the
papal threat. Prominent among this group was the great Florentine
poet Dante Alighieri, who advanced his proimperial and antipapal
views in his Monarchy,
written at the height of the imperial hopes for the 1310 expedition
of Henry VII. The end of the imperial threat soon afterwards, however,
made this turn to the emperor impractical, as well as unpalatable
to the majority of Italians. And so a new political theory was needed
by the oligarchs of the Italian city-states. Such a theory would
assert the claims of the secular state – whether republic or
monarchy made little difference – to rule at will, unchecked
by the age-old moral and often concrete authority of the Catholic
Church to limit state invasions of natural law and human rights.
In short, the Italian oligarchs needed a theory of state absolutism,
of secular power untrammeled. The Church was to be impatiently relegated
to the purely theological and "religious" area while secular
affairs would be in the entirely separate hands of the state and
its temporal power. This amounted to the politique
doctrine, as it would come to prevail in late-16th-century France.
oligarchs found their new theory in the writings of the political
theorist and university professor, Marsiglio of Padua. Marsiglio
can therefore be considered the first absolutist in the modern western
world, and his Defensor
Pacis (1324) the first main expression of absolutism.
was the founding theorist of absolutism in the West, the specific
form of his own cherished polity quickly became obsolete –
at least in Padua. For Marsiglio was an adherent of oligarchical
republicanism, but this form of government proved short-lived, and
disappeared in Padua soon after the publication of his treatise.
During the latter half of the 13th century, the Italian city-states
became riven between the old oligarchs – the magnati –
striving to retain their power, and the newly wealthy but disenfranchised
popolani, who kept attempting to gain power. The upshot was
that throughout northern Italy during the last half of the 13th
century – beginning with Ferrara in 1264 – power was seized
by one man, one signor, one despot who imposed the hereditary
rule of himself and his family. In effect, hereditary monarchy had
been established once again. They were not called "kings,"
since that would have been an absurdly grandiose title for the territory
of one city; and so they gave themselves other names: "permanent
lord," "captain general," "duke," etc.
Florence was one of the few cities able to resist the new tide of
In 1328, four
years after the publication of Defensor Pacis, the della
Scala family finally managed to impose their control over the city
of Padua. The della Scalas had taken over Verona in the 1260s, and
now, after many years of conflict, Cangrande della Scala was able
to seize power in Padua as well. Quick to inaugurate a new tradition
of fawning adulation of tyranny was the prominent Paduan literary
figure Ferreto de Ferreti (c.1296–1337), who abandoned his
previous republicanism to compose a long Latin poem on The Rise
of the della Scala.
The hero Cangrande
had come, according to Ferreti, and brought peace and stability
at last to "turbulent" and torn Padua. Ferreti concluded
his panegyric by expressing the fervent hope that the descendants
of Cangrande della Scala would "continue to hold their scepters
for long years to come."
of the old oligarchic republics countered the rise of the signori
with a prorepublican absolutism of their own. This development began
in the teaching of rhetoric. By the early 12th century, the University
of Bologna, and other Italian centers for training lawyers, had
developed courses in rhetoric, originally the art and style of writing
letters, to which was later added the art of public speaking. By
the first half of the 13th century, the professors of rhetoric were
including direct political commentary in their lessons and handbooks.
One popular form was a propagandistic history of their particular
cities, glorifying the city and its rulers, and expressly devoted
to inculcating the ideology of support for the ruling elite of the
city. The most prominent early master of this genre was the Bolognese
rhetorician Boncampagno da Signa (c. 1165–1240), whose most
popular work was The Siege of Ancona (1201–2). Another
prominent form, developed by Italian rhetoricians in the second
half of the 13th century, was advice books for rulers and city magistrates,
in which political advice was directed to the rulers. The most important
early advice book was John of Viterbo’s The Government of Cities,
which he wrote in the 1240s after serving as a judge under the elected
ruler, or podesta of Florence. John of Viterbo, however,
was not a full absolutist, since his determinedly moral approach
counseled the ruler always to pursue virtue and justice and to avoid
vice and crime.
Italian teaching of rhetoric at Bologna and elsewhere was narrowly
practical, the French professors of rhetoric in the 13th century
upheld the classical Greek and Roman writers as models of style.
The French method was taught at the University of Paris and particularly
at Orleans. By the second half of the 13th century, Italian rhetoricians
who had studied in France brought the new approach to Italy, and
the broader, more humanistic approach quickly swept the field, dominating
even the University of Bologna. Soon these early humanists began
to study the ideas as well as the style of the classical poets,
historians and orators, and began to enliven their political theory
with classical references and models.
The most important
of these early humanist rhetoricians was the Florentine Brunetto
Latini (c. 1220–94). Exiled from his native Florence, Latini
went to France at the age of 40 and imbibed the works of Cicero
and the French rhetorical approach. During his exile, Latini composed
his leading work, The
Books of Treasure, which introduced Cicero and other classical
writers into the traditional works of Italian rhetoric. On his return
to Florence in 1266, Latini also translated and published some of
Cicero’s major works.
important in the new learning was the University of Padua, beginning
with the great judge Lovato Lovati (1241–1309), whom no less
a poet than Petrarch (mid-14th century) called the greatest Italian
poet up to that time. The most important of Lovati’s disciples was
the fascinating character Alberto Mussato (1261–1329). Lawyer,
politician, historian, dramatist and poet, Mussato was the leader
of the republican faction in Padua, the main opposition to the lengthy
campaign by the della Scala family to seize power in that city.
(Ironically enough, Ferreto de Ferreti, the panegyrist of the della
Scala victory, had been a fellow disciple in the Lovati circle.)
Mussato wrote two histories of Italy; his most prominent literary
effort was the notable Latin verse play Ecerinis
(1313–14), the first secular drama written since the classical
era. Here Mussato employed the new rhetoric as politician and propagandist.
He explains in the introduction to the play that his chief purpose
was to "inveigh with lamentations against tyranny," specifically
of course the tyranny of the della Scalas. The political propaganda
value of Ecerinis was quickly recognized by the Paduan oligarchy,
which crowned Mussato with a laurel wreath in 1315, and issued a
decree ordering the play to be read aloud each year before the assembled
populace of the city.
The new study
of the classics also gave rise to sophisticated city chronicles,
such as the Chronicle
of Florence written in the early 14th century by Dino Compagni
(c. 1255–1324), a prominent lawyer and politician of the city.
Indeed, Compagni was himself one of the rulers of the Florentine
oligarchy. Another important example of republican rhetorical humanism
was Bonvesin della Riva’s book, The Glories of the City of Milan
(1288). Bonvesin was a leading professor of rhetoric in Milan.
All these writers
– Latini, Mussato, Compagni, and others – were concerned
to work out a political theory in defense of oligarchical republican
rule. They concluded that there are two basic reasons for the rise
of the hated signori: the emergence of factions within the
city, and love of greed and luxury. Both sets of ills were of course
an implicit attack on the rise of the nouveau riche popolani
and the challenge of the popolani against the old republican
magnates. Without the new wealth of the popolani or the rise
of their factions, the old oligarchy would have gone on their way
undisturbed in the quiet exercise of power. Compagni put it baldly:
Florence was disrupted because "the minds of the false popolani"
had been "corrupted to do wrong for the sake of gain."
Latini sees the source of evil in "those who covet riches,"
and Mussato attributes the death of the Paduan republic to "the
lust for money" which undermined civic responsibility. Note
the emphasis on the "lust" or "coveting" of
money, that is, by new wealth; old and therefore "good"
wealth – that of the magnates – does not require lust
or coveting since it is already in the possession of the oligarchy.
The way to
end factions, according to the humanists, was for the people to
put aside personal interests for unity on behalf of the "public"
or civic "interest," of the "common good." Latini
set the tone by bringing in Plato and Aristotle, Plato for instructing
us that "we ought to consider the common profit above everything
else," and Aristotle for stressing that "if each man follows
his own individual will, the government of men’s lives is destroyed
and totally dissolved."
the "public interest" and the "common good"
may be all very well, until the time comes to interpret in practice
what these cloudy concepts are supposed to mean and in particular
who is supposed to interpret their meaning. To the humanists
the answer is clear: the virtuous ruler. Select virtuous rulers,
trust in their virtue, and the problem is solved.
How are the
people supposed to go about selecting virtuous rulers? That was
not the sort of embarrassing question posed or considered by the
Italian humanists. For that would have led ineluctably to considering
institutional mechanisms which might promote the selection
of virtuous rulers, or worse yet, prevent the selection of the vicious.
Any such tampering with institutions would have led to checks on
the absolute power of rulers, and that was not the mindset of these
humanist apologists for the sovereign power of oligarchy.
were clear, however, that virtue inheres in the individuals and
not in noble families per se. While it was surely sensible
of them to avoid centering virtue in hereditary noble families,
it also meant that the virtuous ruler could personally reign unchecked
by any traditional family ties or commitments.
The only check
offered to ensure the virtue of rulers, the only real criterion
for such virtue, was if the rulers followed the advice of these
humanists, as elaborated in their advice books. Happily, while Latini
and his humanist followers established all the preconditions for
absolute rule, they did not proceed to endorse absolutism itself.
For, like John of Viterbo before them, they insisted that the ruler
must be truly virtuous, including cleaving to honesty and the pursuit
of justice. Like John of Viterbo and others in what has been called
the "mirror-of-princes" literature, Latini and his followers
insisted that the ruler must avoid all temptations to fraud and
dishonesty, and that he serve as a model of integrity. To Latini
and the others, true virtue and the self-interest of the ruler were
one and the same. Honesty was not only morally correct, it was also,
in a later phrase, "the best policy." Justice, probity,
being loved by his subjects rather than being feared – all
would also serve to maintain the ruler in power. Seeming
to be just and honest, Latini made clear, was not enough; the ruler,
both for the sake of virtue and for keeping his power, "must
actually be as he wishes to seem," for he will be "grossly
deceived" if "he tries to gain glory by false methods…"
There was, in short, no conflict between morality and utility for
the ruler; the ethical turned out, harmoniously, to be the useful.
The next great
burst of Italian humanism came in the city of Florence, nearly a
century later. The independence of Florence, the stronghold of oligarchic
republicanism, was threatened, for three-quarters of a century,
from the 1380s to the 1450s, by the Visconti family of Milan. Giangeleazzo
Visconti, signor and duke of Milan, set out in the 1380s
to reduce all northern Italy to his subjection. By 1402, Visconti
had conquered all northern Italy except Florence, and that city
was saved by the sudden death of the duke. Soon, however, Giangeleazzo’s
son, Duke Filippo Maria Visconti, launched the war of conquest again.
All-out war between Florence and imperial Milan continued from 1423
until 1454, when Florence induced Milan to recognize the independence
of the Florentine republic.
status of the Florentine republic led to a revival of republican
humanism. While these early-15th-century Florentine humanists were
more philosophically oriented and more optimistic then their early-14th-century
Paduan and other Italian predecessors, their political theory was
very much the same. All these leading Florentine humanists (much
better known to later historians than the earlier Paduans) had similar
biographies: they were trained as lawyers and rhetoricians, and
they became either professors of rhetoric and/or top bureaucrats
in Florence, in other cities, or at the papal court at the Vatican.
Thus the doyen of the Florentine humanists was Coluccio Salutati
(1331–1406), who studied rhetoric at Bologna and became chancellor
at various Italian cities, in the last three decades of his life
at Florence. Of Salutati’s main disciples, Leonardo Bruni (1369–1444)
studied law and rhetoric in Florence, became secretary at the papal
curia, and then became a top bureaucrat and finally chancellor of
Florence from 1427 until his death. Pier Paolo Vergerio (1370–1444)
began training in law in Florence and then rose to secretary at
the papal curia; and similarly Poggio Bracciolini (1380–1459)
studied civil law at Bologna and Florence and then became a professor
of rhetoric at the papal curia.
generation of the Salutati circle also followed similar careers
and had kindred views. Here should be mentioned the distinguished
architect Leon Battista degli Alberti (1404–72) of the great
banking family, who earned a doctorate in canon law at Bologna and
then became a papal secretary; Giannozzo Manetti (1396–1459)
was educated in law and humanistic studies in Florence, and then
served for two decades in the Florentine bureaucracy, later becoming
secretary at the papal curia and finally secretary to the king of
Naples; and Matteo Palmieri (1406–75) became a top bureaucrat
for five decades in Florence, including eight different ambassadorships.
and economic decline of the Italian city-states after the turn to
the Atlantic in the late 15th and 16th centuries, was marked in
foreign affairs by the repeated invasions of Italy by armies of
the burgeoning nation-states of Europe. The French kings invaded
and conquered Italy repeatedly from the 1490s on, and from the early
1520s to the 1550s the armies of France and the Holy Roman Empire
fought over Italy as a battleground for conquest.
and the remainder of northern Italy were being invaded from without,
republicanism throughout Italy finally gave way to despotic one-man
rule of the various signori. Whereas republican forces, headed
by the Colonna family, had managed to deprive the popes of their
temporal power during the mid-15th century, by the end of that century
the popes, led by Alexander VI (1492–1503) and Julius II (1503–13)
managed to reassert themselves as unchallenged temporal monarchs
over Rome and the papal states. In Florence, the powerful de Medici
family of bankers and politicians began slowly but surely to build
up their political power until they could become hereditary monarchs,
signori. The process began as early as the 1430s with the
great Cosimo de Medici, and culminated in the seizure of power in
1480 by Cosimo’s grandson Lorenzo "the Magnificent." Lorenzo
ensured his one-man rule by setting up a "council of seventy"
with complete control over the republic, all comprising his own
republican forces fought back, however, and the struggle lasted
another half-century. In 1494, the republican oligarchs forced Lorenzo’s
son Piero into exile after he had surrendered Florence to the French.
Republican rule collapsed in 1512, when the Medici took command
with the aid of Spanish troops. Medici power then reigned until
1527, when another republican revolution drove them out; but two
years later the Medici pope, Clement VII, induced the Habsburg Holy
Roman Emperor Charles V to invade and conquer Florence on the Medici’s
behalf. Charles did so in 1530, and the Florentine republic was
no more. Clement VII, left in charge of Florence by the emperor,
appointed Alessandro de Medici ruler of the city for life, and Alessandro
and all his heirs were also named lords of the city in perpetuity.
The government of Florence dissolved into the Medici Grand Duchy
of Tuscany, and the Medicis ran Tuscany as monarchs for two more
The final triumph
of the signori put an end to the optimism of the early-15th-century
republican humanists, whose successors began to grow cynical about
politics and to advocate lives of quiet contemplation.
however, seeing on which side their bread was buttered, executed
a quick shift from praising republican oligarchy to lauding one-man
monarchy. We have already seen Ferreto Ferreti’s swiftness in composing
a panegyric to the della Scala tyranny in Padua. Similarly, around
1400, the peripatetic and usually republican P.P. Vergerio, during
his stay in monarchical Padua, composed a work On Monarchy,
in which he hailed that system as "the best form of government."
Monarchy, after all, ended tumult and the ceaseless conflict of
factions and parties; it brought peace, "safety, security,
and the defense of innocence." Also, with the victory of Visconti
absolutism in Milan, the Milanese humanists quickly fell into line,
composing panegyrics to the glory of princely, and especially of
Visconti, rule. Thus Uberto Decembrio (c. 1350–1427) dedicated
four books on local government to Filippo Maria Visconti in the
1420s, while his son Pier Candido Decembrio (1392–1477), keeping
up the family tradition, wrote a Eulogy in Praise of the City
of Milan in 1436.
With the triumph
of the rule of the signori throughout Italy in the late 15th
and early 16th centuries, proprincely humanism reached a peak of
enthusiasm. The humanists proved to be nothing if not flexible in
adjusting their theories to adapt from republican to princely rule.
The humanists started turning out two kinds of advice books: to
the prince, and to the courtier, on how he should conduct himself
toward that prince.
By far the
most celebrated advice book for courtiers was The
Book of the Courtier (Il libro del Cortegiano), by Baldassare
Castiglione (1478–1529). Born in a village near Mantua, Castiglione
was educated at Milan and entered the service of the duke of that
city. In 1504, he became attached to the court of the duke of Urbino,
which he served faithfully as diplomat and military commander for
two decades. Then, in 1524, Castiglione was passed over to the Emperor
Charles V in Spain, and for his services, Charles made him bishop
of Avila. Castiglione composed the Book of the Courtier as
a series of dialogues between 1513 and 1518, and the book was first
published in 1528 in Venice. The work became one of the most widely
read books in the 16th century (known to Italians as Il libro
d’oro), clearly touching a nerve in the culture of that epoch
in its description and celebration of the qualities of the perfect
courtier and gentleman.
humanists of the early 15th century had been optimistic for man,
for his quest for virtus (or virt) or excellence,
and for the "honor, praise, and glory" which more traditional
Christians had thought due only to God. It was therefore easy for
the later, 16th-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."
republican humanists had nurtured the ideal of "liberty,"
by which they meant, not the modern concept of individual rights,
but republican, generally oligarchical, "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 defense, then goes on to administration of
justice, to public finance, and finally economic policy proper.
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 labor 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 analyze 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."
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.
leading work among the new genre of advice books to princes
was that of Francesco Patrizi (1412–94), in his The Kingdom
and the Education of the King, written in the 1470s and dedicated
to the first activist pope, Sixtus IV, engaged in restoring the
temporal power of the papacy in Rome and the papal states. A Sienese
humanist, Patrizi was made bishop of Gaeta.
As in the other
humanist advice books, Patrizi sees the locus of virtus in
the prince. But it should be noted that, along with his fellow proprince
humanists as well as the earlier republicans, Patrizi’s virtuous
prince is very much the model of Christian virtue. The prince must
be a staunch Christian, and must always seek and cleave to justice.
In particular, the prince must always be scrupulously honest and
honorable. He "is never to engage in deceit, never to tell
a lie, and never to permit others to tell lies." Alone with
his fellow later humanists, however, Patrizi speaks of the prince
as having a different set of virtues from his more passive subjects.
As the maker of history and the seeker after glory, for example,
the prince is not supposed to be humble. On the contrary, he is
supposed to be generous, lavish in spending, and altogether "magnificent."
of the signori led to many advice books entitled, simply
The Prince (Il Principe). One was written by Bartolomeo
Sacchi (1421–81) in 1471 in honor of the duke of Mantua, and
an important one by Giovanni Pontano (1426–1503) who introduced
himself to King Ferdinand of Naples by writing The Prince
in his honor in 1468. In return, King Ferdinand made Pontano his
secretary for more than 20 years. Pontano continued to extol his
patron, in two separate treatises praising the twin princely virtues
in Ferdinand of generosity and lavish splendor. In On Liberality,
Pontano declares that "nothing is more undignified in a prince"
than lack of generosity. And in On Magnificence, Pontano
insists that creating "noble building, splendid Churches and
theatres" is a crucial attribute of princely glory, and lauds
King Ferdinand for "the magnificence and majesty" of the
public building he had constructed.
N. Rothbard (1926–1995) was dean of the Austrian
School, founder of modern libertarianism, and academic
vice president of the Mises
Institute. He was also editor — with Lew Rockwell —
Rothbard-Rockwell Report, and appointed Lew as his