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The golden age of Spain began in 1492, in which year the conquest of Granada extinguished the Arab dominion, and the discovery of America by Columbus opened a new world to the enterprise of the Spanish cavaliers. It continued during the reigns of Charles I. and Philip II., extending over a period of about a century, during which Spain was the leading power in Europe, and occupied the foremost position in the civilized world. In Europe its possessions included the Netherlands and important regions in Italy, while its king, Charles I., ruled as Charles V. over the German empire, possessing a dominion in Europe only surpassed by that of Charlemagne. Under Philip II. Portugal became a part of the Spanish realm, and with it its colony of Brazil, so that Spain was the unquestioned owner of the whole continent of South America, while much of North America lay under its flag.

Wealth flowed into the coffers of this broad kingdom in steady streams, the riches of America over-flowing its treasury; its fleet was the greatest, its army the best trained and most irresistible in Europe; it stood as the bulwark against that mighty Ottoman power before which the other nations trembled, and checked its career of victory at Lepanto; in short, as above said, it was for a brief period the leading power in Europe, and appeared to have in it the promise of a glorious career.

Such was the status of Spain during the reigns of the monarchs named. This was followed by a long period of decline, which reduced that kingdom from its position of supremacy into that of one of the minor powers of Europe. Various causes contributed to this change, the chief being the accession of a series of weak monarchs and the false ideas of the principles of political economy which then prevailed. The great treasure which flowed into Spain from her American colonies rather hastened than retarded her decline. The restrictions and monopolies of her colonial policy gave rise to an active contraband trade, which reaped the harvest of her commerce. The over-abundant supply of gold and silver had the effect of increasing the price of other commodities and discouraging her rising industries, the result being that she was obliged to purchase abroad the things she ceased to produce at home and the wealth of America flowed from her coffers into those of the adjoining nations. Her policy towards the Moriscos banished the most active agriculturists from the land, and large districts became desert, population declined, and the resources of the kingdom diminished yearly. In a century after the death of Philip II. Spain, from being the arbiter of the destinies of Europe, had grown so weak that the other nations ceased to regard her otherwise than as a prey for their ambition, her population had fallen from eight to six millions, her revenue from two hundred and eighty to thirty millions, her navy had vanished, her army had weakened, and her able soldiers and statesmen had disappeared.

In addition to the causes of decline named, others of importance were her treatment of the Jews and the Moriscos, though the banishment of the former took place at an earlier date. Despite their activity in trade and finance and the value to the nations of their genius for business, the Jews of Europe were everywhere persecuted, often exposed to robbery and massacre, and expelled from some kingdoms. In Spain their expulsion was conducted with cruel severity.

Many of the unfortunate Jews, seeking to escape persecution, embraced Christianity. But their conversion was doubted, they were subjected to constant espionage, and the least suspicion of indulging in their old worship exposed them to the dangerous charge of heresy, a word of frightful omen in Spain. It was to punish these delinquent Jews that in 1480 the Inquisition was introduced, and at once began its frightful work, no less than two thousand “heretics” being burned alive in 1481, while seventeen thousand were “reconciled,” a word of mild meaning elsewhere, but which in Spain signified torture, confiscation of property, loss of citizenship, and frequently imprisonment for life in the dungeons of the Inquisition. Severe as was the treatment of the Jews throughout Christendom, nowhere were they treated more pitilessly than in Spain.