subjects of Philip II;
subjects, yet half free, escaping his control. It was intolerable that
the Netherlands, infested with heresy, drawing their wealth from the
enemies of Spain, and from Spain itself, should not contribute their
share to the service of the empire.

To control the Netherlands and to divert the profits of Dutch trade into
the Spanish treasury was thus an essential part of Philip's policy. When
the Duke of Alva left for Brussels in 1567 he promised to make the
Netherlands self-supporting and to extort from them an annual revenue of
two million ducats. But the methods of Alva were destined to failure. He
was a better master of war than of finance, and by ruining Dutch trade
he killed the goose that laid the golden egg. The Southern Netherlands
were finally conciliated by a more skillful policy than any known to
Alva; but the city of Antwerp never recovered from the ruin which
Philip's unpaid soldiers inflicted upon it in 1576, and when the war was
over, the commercial and industrial activities which had made it
prosperous were to be found in Amsterdam in the independent Netherlands,
and in London across the Channel.

Yet if the Netherlands escaped the direct control of Philip, their
wealth might be appropriated at its source. The Portuguese were still
intrenched in the East, and Dutch prosperity was in no small part
founded on privileges granted at Lisbon. Philip's opportunity came in
1580 when a disputed succession to the throne opened the way to
intervention and the rapid conquest of Portugal. At a stroke the
Portuguese dominions in Africa and the East Indies were added to Spain's
American possessions. Throughout Europe Philip was thought to have
played a winning card; for the most desired sources of the world's
wealth were at the disposal of the Catholic king if he could but police
the sea. But so complete a monopoly was not to be endured by his rivals;
and France, Holland, and England, as a necessary prelude to their
colonizing activities in the New World and in the Old, gathered their
forces to dispute the maritime supremacy of Spain.

II

It was well understood that the power of Philip II depended upon his
American treasure, and his treasure upon his control of the sea. "The
Emperor can carry on war against me only by means of the riches which he
draws from the West Indies," cried Francis I when Verrazano brought home
some treasure taken from Spanish ships in Western waters. And Francis
Baco