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By Root 887 0

contemporary, Adam Smith, would write about decades later. It was Smith’s contention in his 1776 bible of capitalism, The Wealth of Nations, that the wealth of a country was not the gold that it held but the goods and services it provided. When Smith was articulating this theory, he took the example of Spain. The nation was in precipitous decline after centuries of trying to enrich itself by extracting wealth, often literally gold, from its Latin American holdings. What Smith, however, did not go on to say—but which illustrates his point exactly—is that while Spain was wasting its energies amassing American gold, the Basques generated affluence throughout the Iberian peninsula by providing goods and services to and from Latin America.

Another lesson in capitalism practiced by the Basques and later espoused by Smith: Having broken the Dutch cocoa monopoly, the Basques caused the price of chocolate to plunge. Far from causing a crisis, the almost halved price made chocolate more accessible and greatly expanded the market, making the trade far more profitable than it had been under Dutch price fixing.

The company produced spin-offs such as the Real Compañia de Habana for trade with Cuba and another for trading with the Philippines. Lasting fifty-six years, the Royal Guipúzcoan Company of Caracas had an enormous impact not only on Basqueland but on Latin America. It greatly facilitated the Basque dream of making a fortune in America, but the prosperity that it brought to Caracas, as well as the unbridled exploitation, also had much to do with the Spanish loss of colonies and the creation of an independent Venezuela. In 1749, a violent uprising against the Royal Guipúzcoan Company erupted in Caracas. To avoid further uprisings, producers were paid better, causing dividends to drop to only 5 to 10 percent.

Ironically, the aspirations of these South American rebels were realized a generation later by the father of Latin American independence, Simon Bolivar, El Libertador, who was born in Caracas in 1783 to a Vizcayan family that had grown wealthy in South America.

But it was in Basqueland itself that unrestrained capitalism and the emergence of a new wealthy class were creating a rift that would lead to more than a century of civil war.

Part Two

THE DAWN OF EUSKADI

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The Basques are said with good reason, to be agile and deft and have earned their reputaton of being good shots.

—ILLUSTRATED GUIDE FOR THE TRAVELER TO SAN SEBASTIÁN, 1909

The Basques . . . are a religious, deep driking, non-swearing race who live on the mountainous south-eastern shores of the Bay of Biscay. They are profoundly nautical; they swing and fish in the Bay without ever feeling sea-sick.

George Steer, THE TREE OF GERNIKA, 1938—

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The Basque Onomatopoeia

Food is always, more or less, in demand.

—Adam Smith, THE WEALTH OF NATIONS, 1776

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FOR THE REST of the world, the little-remembered Carlist Wars were to have only two lasting consequences: the invention of the political term liberal and the popularizing of the beret. These two brutal and complicated nineteenth-century civil wars were to shape the destiny of at least six generations of both Basques and Spaniards. Their enduring impact is most easily seen in features of daily life such as food and clothing. Carlism resulted not only in the famous Basque hat but in the creation of their most mysterious, and therefore some might argue, most Basque sauce.

According to popular and unverified legend, in 1836 a Bilbao salt cod merchant named Gurtubay placed an order by telegram saying, “Send me by the first ship that lands in Bilbao, 100 or 120 top quality salt cods,” which in Spanish was written “100 o 120 bacaladas.” The telegraph code was misinterpreted as “1,000,120 bacaladas.”

In any event, Gurtubay got a lot more salt cod than he had expected, and had no possibility of returning it, because by then the First Carlist War had begun and Bilbao was under siege. The mistake might have been ruinous had not the city started running out of supplies.