User:Savidan/Economic history of the Holy See

__NOINDEX__ The economic history of the Holy See is a critical element of the history of the Papacy since the fourth century. The Holy See is the seat of the bishop of Rome, also known as the Pope, and the head of the Roman Catholic Church, and its historical errand has more often than not proved expensive.

The economic history of the Holy See does not include the economic history of the Roman Catholic Church except insofar as economic developments in the universal church affected the finances of the papacy itself; nationally and regionally, the economic history of the various Sees varied considerably.

Early church (until 313)
Back in the day with J.C., Saint Peter and the other Apostles were poor; they walked everywhere, had to go searching in fishes mouths for the requisite tolls to enter cities, and were generally renouncing all their possessions and walking the earth.

Donation of Constantine (313 - 537)
Constantine I made the pope a major landlord in Rome and an economic force in whom secular Italian and European powers had an incentive to take an interest in for the first time with the Donation of Constantine. While the document itself was a medieval forgery, historians agree that Constantine I did give the Holy See its first major parcels of real estate including Basilica of St. John Lateran, the adjoining Lateran Palace, and Old St. Peter's Basilica. The impact of economics on papal selection before 1059 is apparent, as the choice of pope became an important economic consideration for warlords and emperors alike.

Popes took the medieval donation far more seriously than the secular European rulers contemporary to them. For example, William the Conquerer was enjoined to come to Rome to pay tribute for his newly conquered fife after his conquest of England, an act he never seriously intended to undertake.

Byzantine Papacy (537-752)
The medieval financial institutions of the papacy originated during the Byzantine Papacy, and were modeled after financial institutions of the Byzantine imperial court: the vestararius (after the Byzantine protovestiarios), arcarius, and the saccellarius. These officials were among the palatini, the highest officials in the papal court. During this period, Pope Agatho earned the scorn of his Roman biographer by taking up the office of the arcarius himself, personally transacting from the papal treasury and "issuing receipts by his own hand through a nomenclator".

These offices persisted after the loss of Byzantine control. For example, Theophylact I, Count of Tusculum, who controlled papal appointments during the saeculum obscurum, held the office of vestararius.

Donation of Pepin and the Papal States (756 - 1088)
It would, however, be wrong to suppose that all papal claims of secular jurisdiction, taxation and service, etc. were exactly defined, or that they applied with equal force all over a large region of central Italy, or that local warlords or others readily conceded obedience to Rome. this was no modern state yet, no equivalent to the contemporary strong monarchies of France or England. Force of tradition and forceful possession counted more than written deeds of donation. --D.S. Chambers

Apostolic Camera (1192 - )
Cardinal Cencius (future Pope Honorius III) compiled the first comprehensive list of the papacy’s real estate revenues, in eighteen volumes covering 492 to 1192 in the late twelth century, the Liber Censuum. The Liber Censuum simultaneously constitutes the "latest and most authoritative of a series of attempts, starting in the eleventh century, to keep an accurate record of the financial claims of the Roman church" and "the most effective instrument and [...] the most significant document of ecclesiastical centralization" in the central Middle Ages.

The records of the Apstolic Camera continue with Introitus et Exitus (complete from 1279 to 1524), one of the most important primary sources of the economic history of Europe during this period.

Relations with Italian bankers


The Pope was in no personal position to collect the vast majority of ecclesiastical revenues he considered himself entitled to; this task was outsourced to a string of Italian banking houses, each tied to a powerful family.

[info in the Gran Tavola article]

The process for papal election itself was marked by curious economic transactions. First, it was traditional for general lawlessness to break out in the city of the conclave, and for the estates of the winner to be ceremonially pillaged. Furthermore, under the rules of the papal conclave, as promulgated by Pope Gregory X in Ubi periculum the cardinals were prevented from collecting ecclesiastical revenues during the conclave, one of the many incentives designed to hasten the often dilatory process.

Avignon Papacy (1305 - 1378)
The most effective solution to the papacies historical dilemma of consolidating assets from across the European continent was not realized until the advent of the Avignon Papacy. The Avignon Exchange which sprung up in the city of Avignon around the new seat of the pope was one of the first foreign exchange markets in history and one of the most powerful financial centers of medieval Europe.

Prior to the creation of the Avignon Exchange, most financial transactions were either poorly document or not written down at all as the “intervention of notaries” was considered “not businesslike”

The wars of the Papal States and the employment of various Italian condotierri all but bankrupted the Papacy. The final war of the Avignon Popes, the War of the Eight Saints gave rise to the largest expropriation of eccleciasitical property in Europe until the French revolution, as Florence and the other Italian city states searched for new sources of funding with which to fund the general insurrection within the Papal States.

Renaissance popes (1378 - 1517)
In the Renaissance the Holy See often fell into the possession of members of the various powerful families, who used its authority to invest their relatives with benefices and other sources of extreme wealth. While the curial ofice of the Cardinal Nephew was the Superintendent of the Ecclesiastical State, and thus the primary administrator of the revenue of the various economic entitlements of the papacy.

The nepotism of a few popes wrought extreme financial crises on the church, notably the handiwork of Pope Urban VIII (1623–1644) that demonstrated to his successors the need for reform.

According to conclave historian Thomas Trollope, simony was common in papal elections during this period "so that it seems to have been quite as much a recognized thing, even among the strictest, in those admirable 'ages of faith,' that a candidate for heaven's viceregency should come up to Rome with his banker to support him, as that in our days a candidate should seek similar aid in presenting himself to a select borough constituency".

Indulgences and the Reformation (1517 - 1605)


It is common knowledge that the outrage over the widespread use of the selling of Indulgences, relied on to an unprecedented extent by the Medici popes, Pope Leo X and Pope Clement VII (in part to further the reconstruction of St. Peter’s Basilica) contributed in large part to the grievances that gave rise to the Protestant Reformation in Germany, the spread of which to northern Europe and Scandanavia severly deprived the papacy of its historical flow of assets.

Bank of the Holy Spirit (1605 - 1790)
Pope Paul V established the Bank of the Holy Spirit in 1605. The bank was the first public deposit bank in Rome and the first national bank in Europe.

Pope Gregory’s 1745 encyclical Vix Pervenit codified for the first time the church’s medieval prohibition against usury.

From the French Revolution (1790 - 1861)
The Civil Constitution of the Clergy passed by the National Constituent Assembly on July 12, 1790 was the largest expropriation of papal assets in history, outpacing even the Reformation due to the size of the French ecnomy and the depth of the church’s historic influence. According to Pollard, “the origins of the trans-formative process which helped create the modern papacy can largely be traced back to the French Revolution and its aftermath”. The nationalization of the French church and its largess was a “rude awakening indeed for Rome”.

From the Risorgimento (1861-1939)


According to Pollard, change in financial services instutions were instrumental in transforming the papacy from an “essentially small, semi-feudal and territorial state with fairly loose spiritual authority over millions of Catholics outside the Italian peninsual” to a “highly bureaucratic instution, with an increasingly global diplomatic outreach, and which exercised an increasingly rigid, centralised and undisputed control over the world-wide Roman Catholic Church”.

Throughout the nineteenth century, the popes continued to rely on European bankers for loans, even though "they disdained the bourgeois new money and Jews who were associated with it". Loans from Jewish bankers such as the Rothschild family often came with conditions about the treatment of Jews in the papal states, although these were notoriously reneged on. The pope was in essence "one of the last aristocratic landlords in Europe" and thus felt the shock of the transition from a primarily agricultural to a primarily industrial economy.

The conquering of the Papal States by Giuseppe Garibaldi and Camillo Benso, conte di Cavour during the wars of Italian unification in 1861 deprived the papacy of its feudal revenue sources, leaving it completely reliant on the voluntary contributions of foreign Catholics. The Roman Question was ended with the conclusion of the Lateran Treaty in 1929, which in part resulted in a transfer of 750 million lire and 1,000 million in government bonds (over $1 billion in 2006 US dollars), from Mussolini's government to the newly created Vatican City; the majority of these funds would be invested in capitalist markets around the world.

From World War II (1939-present)
According to Phayer, "the transition after 1870 from a feudal landed economy to an industrial capital-based economy ushered in a money culture to which Vatican officials had had ample time to acclimate themselves to by the middle of the twentieth century"; the highest positions in the Curia, including the pope himself, were either involved in financial affairs or filled with those who had previously so distinguished themselves. The first cardinal from the United States, George Mundelein (elevatd 1924), was one of Pius XI's biggest fundraisers; the economic importance of American Catholics even today is one factor contributing to the existence of thirteen (eleven voting eligible) American cardinals (representing 67 million Catholics), compared to only fifteen (nine voting) cardinals for Brazil, Mexico, and the Philippines combined (representing 340 million Catholics).

Pope Paul VI established Administration of the Patrimony of the Apostolic See on August 15, 1967, merging together the Administration of the Property of the Holy See and the Special Administration of the Holy See. Distinct from these is the Prefecture for the Economic Affairs of the Holy See, which does not manage finances, but rather provides audits and other services. The Institute for Works of Religion, more commonly known as the Vatican Bank, is not overseen by that Prefecture, but rather an independent cardinalate commission.

The modern papacy has been plagued by various financial scandals associated with the Vatican Bank and Banco Ambrosiano.