Is Taiwan the Next Hong Kong?
China Tests the Limits of Impunity
Between 1492 and 1914, Europeans conquered 84 percent of the globe, establishing colonies and spreading their influence across every inhabited continent. This was not inevitable. In fact, for decades, historians, social scientists, and biologists have wondered: Why and how did Europe rise to the top, even when societies in Asia and the Middle East were far more advanced?
So far, satisfactory answers have been elusive. But this question is of the utmost importance given that Europe’s power determined everything from who ran the slave trade to who grew rich or remained mired in poverty.
One might think the reasons for Europe’s dominance obvious: the Europeans were the first to industrialize, and they were immune to the diseases, such as smallpox, that devastated indigenous populations. But the latter reason alone cannot explain the conquest of the Americas, since many young Native American warriors survived the epidemics. And it fails to explain Europe’s colonization of India, since the Indians had similar immunity. Industrialization also falls short as an explanation: the Europeans had taken control of more than 35 percent of the planet even before they began to industrialize. Of course, the lead Europeans took in developing the technology of guns, armed ships, and fortifications was critical. But all the other major civilizations in Asia had the same gunpowder technology, and many of them also fought with guns.
So what did contribute to Europe’s success? Mostly, it derived from the incentives that political leaders faced in Europe—incentives that drove them not just to make war, but also to spend huge sums on it. Yes, the European monarchs built palaces, but even the huge Chateau at Versailles cost King Louis XIV less than two percent of his tax revenue. The rest went to fighting wars. He and the other kings in Europe had been raised since childhood to pursue glory on the battlefield, yet they bore none of the costs involved—not even the risk of losing their thrones after a defeat. Leaders elsewhere faced radically different incentives,, which kept many of them militarily weak. In China, for example, emperors were encouraged to keep taxes low and to attend to people’s livelihoods rather than to pursue the sort of military glory that obsessed European kings.
For this and a variety of other reasons, leaders outside of Europe could not match Europe’s innovations in warfare innovation. The huge sums of money showered on fighting in Europe gave military leaders the flexibility to buy new weapons and battleships and try out new tactics, fortifications, and methods of supply. In the process, they learned from their mistakes and improved their technologies. And because European countries were small and geographically close, they could easily learn from their rivals’ errors and copy their improvements. When the Swedish King Gustavus Adolphus constructed one of the earliest two-decked gunships in 1628, for example, it sank shortly after setting sail. But the Swedish navy and other navies across Europe swiftly learned from this failure, and by the eighteenth century they were building warships with two or more gun decks that were not only stable, but also had a longer range and were more maneuverable than seventeenth-century warships.
Without a single-minded focus on war and the extraordinary ability to tax, there may never have been any European empires.
Outside of Europe, political and military conditions kept war innovations, particularly new gunpowder technology, from being advanced at the same relentless pace. China, for instance, had far less tax revenue to spend on the military than the Europeans did. In the late eighteenth century, per-capita taxes were 15 times higher in France than in China, and 40 times higher in England, and much of the tax money China did collect went not toward new forms of fighting but to aid archers on horseback, who were far more effective than musketeers in fighting the nomads who had long been China’s major enemy. What’s more, China was often the dominant power in East Asia, so fewer rivals dared to challenge it, which meant it had little incentive to spend heavily on its military. As a result, there was simply less use for gunpowder weapons in East Asia.
Europe, by contrast, had no such dominant power. And once the Western Europeans took the lead in pushing gunpowder technology forward, it was hard for China to catch up; the center of progress was a continent away.
Europe’s military lead continued into the nineteenth century. Tax revenues rose as Europe industrialized, and the innovations from the Industrial Revolution—applied science and engineering—made it possible for Europeans to improve their technology not just by waging war, but also by conducting research, which magnified what the Europeans learned on the battlefield.
By 1914, Europe had not only achieved global military dominance, it also had powerful states that could raise huge sums of tax revenue to fund wars. In France and Germany, real per-capita tax revenue had increased 15 fold or more over the previous two centuries. That enormous capacity to tax went well beyond what can be explained by the higher per capita incomes that industrialization brought to Europe. It was the result of the same kind of learning that advanced the gunpowder technology. The only difference was that here the learning involved economics rather than military technology, and the rewards went to political leaders who successfully bargained with the elites to boost tax revenues. The leaders then used the added tax revenue to expand and equip their armies and navies.
Europe’s ability to tax was no small achievement. China could not raise equivalent tax revenues, even in the nineteenth century. And countries in sub-Saharan Africa today still lack the basic capacity to tax, which keeps them from providing security and other basic public goods to their citizens.
So what did contribute to Europe’s success? Mostly, it derived from the incentives that political leaders faced in Europe—incentives that drove them not just to make war, but also to spend huge sums on it.
Europe had yet another advantage as well: its entrepreneurs were free to use gunpowder technology to mount expeditions of conquest, colonization, and militarized trade. Although they usually needed official permission to launch a voyage, entrepreneurs were often encouraged by authorities eager to find riches abroad. And they had no trouble acquiring weapons or finding battle-hardened veterans to train military novices who joined their undertakings. By the seventeenth century, such private expeditions had spawned gigantic enterprises that raised huge sums on Europe’s burgeoning capital markets to finance ventures abroad, enterprises such as the Dutch East India Company, which was not only a private arm of Dutch foreign policy, but also the first business to issue tradable shares of stock.
A final difference between Europe and the rest of the world lies in political history. From 221 B.C. onward, China, more often than not, was unified in a large empire. The Chinese empire soon developed a centralized bureaucracy that drew local elites into government service and gave them a stake in the empire’s survival. The rewards of government service helped hold the empire together, and as long as the empire was strong and unified, other East Asian powers hesitated to attack it. This meant that China had little incentive to seek out new enemies or opportunities.
Western Europe, by contrast, experienced no such lasting unification after the collapse of the Roman Empire. What it endured instead were centuries of warfare by bands of warriors whose leaders resembled modern-day warlords. The incessant fighting groomed leaders who were victorious in war. The conflict also generated enduring enmities between leaders and their followers, enmities that eventually hardened into lasting political borders. It was such ill will—and not Europe’s physical geography—that kept any single leader from ever uniting Western Europe in the sort of durable empire that prevailed for centuries in China. In the long run, the winners in Western Europe were the military leaders who learned how to impose heavy taxes to fund their fighting, and as a result, Europe ended up with kings who spent pharaonic sums on warfare and who had, in the words of Machiavelli, “no object, thought, or profession but war.”
Without a single-minded focus on war and the extraordinary ability to tax, there may never have been any European empires. The wars and the taxes lavished on them gave the Europeans an enormous lead in military technology. This enabled their conquests, and allowed them to keep native populations under control without stationing large numbers of European troops abroad. Without such advantages, the Europeans might have grown rich anyway—and perhaps even industrialized early—but they would not have dominated the world in 1914.