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number of peasant families from the Canary Islands were transferred with
53 The silver miners in question were the Count of Regla and the Count of Valenciana. These donations
were also common in France. See Martine Acerra and Andr´ Zysberg, L™essor des marines de guerre
e
europ´ennes, 1680“1790 (Paris: Editions Sedes, 1997), p. 71, which notes that fourteen warships of
e
the French Royal Navy were ¬nanced by donations from French wealthy contributors between 1763
and 1766.
54 For the increase in military expenditures and the expansion of military forces in Spanish America
in the eighteenth century, see J. Marchena, “Financiaci´ n military y situados,” 271“273. On Cuba,
o
see Allan J. Kuethe and C. Douglas Inglis, “Absolutism and Enlightened Reform: Charles III, the
Establishment of the Alcabala, and Commercial Reorganization in Cuba,” Past and Present, 109
(1985), 118“143.
55 Engel Sluiter, The Florida Situado: Quantifying the First Eighty Years, 1571“1651 (Gainsville: Uni-
versity of Florida Libraries, 1985), pp. 5“6. As late as the eighteenth century the situados were used
to cover these expenses as can be seen in the “reales c´ dulas” of November 20, 1741; October 13,
e
1756, and April 6, 1763: Archivo General de la Naci´ n (hereafter AGN), Mexico, Reales C´dulas
o e
Originales, vol. 61, exp. 91, f. 334; vol. 76, exp. 123, f. 290; and vol. 86, exp. 66.
56 See, for example, AGN, Reales C´dulas Originales, vol. 62, exp. 60, f. 185; vol. 76, exp. 144, f. 331;
e
and vol. 63, exp. 60, f. 159, Historia, vol. 570, f. 57, and Archivo Hist´rico de Hacienda, leg. 1210,
o
exp. 1.
38 Bankruptcy of Empire

support of the royal treasury, or the case of Trinidad, where the Spanish
government promoted agricultural colonies.57
Last but not least, important remittances not related to imperial defense
were those managed by the royal tobacco monopoly. In order to help pay the
costs of the annual tobacco harvests in Cuba, the Madrid Cabinet instructed
the tobacco monopoly of New Spain to send a ¬xed annual sum to the royal
treasury in Cuba to assist with annual payments due to local tobacco farmers.
In 1723 the sum sent to Havana on this account was of 200,000 pesos, but
by 1744 the ¬gure had risen to 500,000 pesos per year, at a time when the
money destined for the military garrison of the Cuban port was but 400,000
pesos. Both the tobacco and military remittances were rati¬ed in 1768 and
continued to be sent annually from New Spain until the beginning of the
nineteenth century.
The signi¬cance of the tobacco situado was underlined by Ram´ n de o
la Sagra in a classic study which pointed out the strategic importance of
the Mexican silver transfers in greasing the wheels of the royal tobacco
monopoly, probably the largest state enterprise in the eighteenth-century
world.58 According to de la Sagra, more than 100 million pesos worth of
tobacco leaf were sent from Cuba to Spain during the ¬ve decades of 1760“
1810.59 The Cuban leaf was processed by the great Seville tobacco factory,
helping to generate almost 25 percent of total revenues of the metropolitan
treasury by the end of the century.60 As a result, Mexican and Cuban ¬scal
subsidies were key factors for the solvency of the monarchy.

Geographic Distribution of the Situados
The increase of the volume of tax remittances from colonial Mexico to the
Spanish Caribbean during the eighteenth century was of such signi¬cance

57 See AGN, Reales C´dulas Originales, vol. 64, exp. 33, f. 103, Historia, vol. 570, f. 25, and Eduardo
e
Arcila Far´as, Comercio entre M´xico y Venezuela en los siglos XVI y XVII (Mexico: IMCE, 1975), p. 218.
± e
58 Ram´ n de la Sagra, Historia econ´ mico-pol´tica y estad´stica de la isla de Cuba (Habana, 1831), pp. 240“
o o ± ±
266. That the Spanish tobacco monopoly was an enormous enterprise can be judged from the fact
that from 1770 its production sphere included factories in Spain (that at Seville employed over
5,000 workers in 1800), in Mexico City (over 8,000 workers in 1800), as well in many other parts
of the empire. At the same time, thousands of persons were employed in of¬cial tobaccionist sales
points throughout the empire. Finally, several thousand tobacco farmers in Cuba and Mexico as well
as a fewer number in Louisiana, Puerto Rico, Santo Domingo, New Granada and the Phillipines
depended for their living upon the royal monopoly. For details, see Laura Nater, “El tabaco y las
˜ ˜
¬nanzas del imperio espanol: Nueva Espana y la metr´ poli, 1760“1810,” Ph.D. thesis, El Colegio
o
de M´ xico, 1998.
e
59 R. de la Sagra, Historia econ´ mico-pol´tica y estad´stica, pp. 264“266.
o ± ±
60 By the 1780s the tobacco monopoly was contributing close to a quarter of annual ordinary revenues
of the Spanish Treasury. The estimates are to be found in C. Marichal, “Bene¬cios y costes ¬scales
del colonialismo. Also see data in Appendix I.
Resurgence of the Spanish Empire 39

that the distinguished Cuban historian Le Riverend called this period the
“golden age of the situados.”61 As previously indicated, the bulk of the
silver pesos were normally sent in ships of the Spanish Navy from Veracruz
to Havana and hence redistributed to other points in the greater Caribbean,
although some royal tax transfers were sent via other routes. (See the map
on page 40.) The amount of money sent annually to the diverse ports,
fortresses, and garrisons was, generally speaking, a function of the relative,
strategic importance of each.62 Although ¬xed yearly amounts (to each des-
tination) were rati¬ed by different royal orders, the actual sums sent varied
considerably from year to year, depending on a variety of factors. Variations
in troop strength of the various garrisons as a result of deaths and desertions
or, alternatively, as a result of the outbreak of military con¬‚icts in the region
had an impact on ¬nancial demands. Likewise, the requirements of naval
squadrons could change dramatically as a result of battles or storms: the loss
of a large number of ships, inevitably, implied extraordinary expenditures
as much new ship construction became obligatory.
Throughout the eighteenth century the Havana “Situado” was made up
of three principal items: “tierra”, “marina,” and “tabaco,” the former two
categories being essentially defense expenditures. The ¬rst royal order that
refers to the ordinary annual “Situado” to Havana is that of August 2, 1744,
in which it was established that 500,000 pesos should be sent from New
Spain to cover the annual expenses of the Cuba royal treasury of¬ces in the
acquisition of the tobacco harvest.63 Archival sources indicate that during
the 1750s the remittances of Mexican tax funds for infantry in Havana
averaged 400,000 pesos a year as well and additional 500,000 pesos for
naval forces and shipbuilding.64

˜
61 J. Le Riverend, “Relaciones entre Nueva Espana y Cuba,” 92 and 143“144 is one of the ¬rst historical
studies to have underlined the signi¬cance of the situados; his estimates of remittances to Cuba from
New Spain appear to be based on R. de la Sagra.
62 Each American province was obliged to send documents that justi¬ed the level of defense expendi-
tures, and this explains why in the AGN of Mexico there are numerous reports of the regiments in
each garrison and of the number of deaths and deserters. See, for example, reports on garrisons in
Puerto Rico, AGN, Archivo Hist´rico de Hacienda, leg. 1210.
o
63 E. Arcila Far´as, Comercio entre M´xico y Venezuela, p. 203 con¬rms the ¬gure of 500,000 silver pesos,
± e
but J. Marchena, “Financiaci´ n military y situados,” registers only 400,000 pesos. R. de la Sagra,
o
Historia econ´mico-pol´tica y estad´stica, p. 277 indicates that in 1756, 436,000 pesos of the Mexican
o ± ±
remittances were annually spent to maintain the four battalions of infantry, one of cavalry, and one
of artillery in Havana.
64 AGN, Caja Matriz, Libro manual de cargo y data de la Real Caja de Veracruz for the year 1758 and J.
Marchena, “Financiaci´ n military y situados.” It should be noted that the category of “marina” is
o
one of the most dif¬cult to specify since some of the funds went for the salaries of sailors and of¬cers
and other sums for provisions and ship repair or construction. For example, a report of October 19,
1758 indicated that of 1,016,094 pesos sent to Havana for “marina,” 407,123 pesos were to be used
for expenses of the naval squadron, 100,924 pesos for ship construction, and 508,047 for urgent
naval disbursements. AGN, Historia, vol. 570, f. 204.
CASTILLA

NA
FLORIDA OCCIDENTAL
IA BERMUDAS
IS PANZACOLA
U




L
MOBILA (SANTA MAR’A
DE GALES) JOS AS SAN AUGUST’N
L
NUEVA ORLEANS NB
SA DE LA FLORIDA
N




S
NT




SA A
A
Spanish colonies that received Mexican
RO
tax silver




SA
Direction, remittances and volume

Ships originating in Mexico with tax silver
for Greater Caribbean and Spain
BAHAMAS
Other European colonies in the Greater Caribbean
English
French
Dutch
Danish
LA HABANA
ICO
OR
RT
E
PU
CAMPECHE DE
N
VERACRUZ A L
JU BA OM
N
SANTO OL
EL CARMEN ST RT
SA A
DOMINGO RI BA AD
C N RB
N SA BA
SA AT
R
JAMAICA SER
NT
AS MO GUADALUPE
NEVIS
OM
TH MAR’A GALANTE
NT
I
DOMINICA
PUERTO CABALLOS SA
MARTINICA
SANTA LUC’A


CURACAO


TOBAGO
TRINIDAD
SANTA MARGARITA
PUERTO
MARTA
BO
AI



CABELLO CARACAS CUMANA
CARTAGENA
(LA GUAIRA)
PORTOBELO
AC
MAR




M
PANA
Silver Remittances from Treasuries of Mexico to
Spanish Colonies in the Caribbean and to Spain (circa 1790)

Source: Drawn by Araceli Serrano, based on Carlos Marichal and Matilde Souto, “Silver and Situados: New Spain and the Financing of the
Spanish Empire in the Caribbean in the Eighteenth Century,” Hispanic American Historical Review, 74, 4 (1994), 587“613.
Resurgence of the Spanish Empire 41

After the British invasion and occupation of Havana in 1762, during
which local shipyards and forts were seriously damaged, royal of¬cers sta-
tioned in Cuba called for increased ¬nancial assistance. In 1765, orders were
sent from Madrid, instructing the treasuries of New Spain to annually send
300,000 pesos for forti¬cations in Havana and 100,000 pesos for those in
Santiago de Cuba. Three years later in 1768 the remittances to Havana were
increased, reaching the sum of 1,900,000 pesos, of which 700,000 pesos
were to be used for naval purposes, 400,000 for army troops, 300,000 for
forti¬cations, and 500,000 for the tobacco harvest.65
According to the expert statistician Ram´ n de la Sagra, between 1766
o
and 1788 Havana received ¬fty-eight million pesos in ¬scal transfers from
Mexico, and another ¬fty-seven million pesos in the years from 1789 to
1806.66 These ¬gures must be considered estimates since there are consid-
erable differences in the data provided by other contemporary sources but
they suggest the enormity of the ¬scal contribution of colonial Mexico to
the Spanish colonies in the greater Caribbean.67 Signi¬cant differences are
also found when comparing the extraordinary sums registered at times of
war in the Caribbean, particularly in the 1760s, early 1780s, and 1790s. In
order to provide an idea of the complexities involved in these ¬scal trans-
fers, we brie¬‚y analyze the remittances from New Spain during the war
of 1779“1783 when the Mexican situados to Havana and the rest of the
Spanish Caribbean reached their highest peak in all of colonial history.

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