General Discussion

malaise

(268,898 posts) Sat Oct 13, 2012, 08:53 AM Oct 2012

The 1649 Potosi mint scandal rocked currency and commodities markets across the globe

http://tulane.edu/liberal-arts/newsletter/news-from-field-oct-2012.cfm
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In the midst of these contentious records I started to see familiar names - particularly of slaves and masters who had tangled with each other before. Here at last were numerous African-born mint workers testifying against their owners as to how they had been ordered to debase huge batches of coin silver with copper and tin in the middle of the night. Despite being strung on torture racks to dissuade them from perjury, they consistently testified that they had been blamed, and often whipped and otherwise punished, whenever past investigators had discovered bad coins. This was what the records in Potosi had been saying over and over - that the mint's slaves routinely stole silver cuttings from the shop floor which they then traded for alcohol or food. It was assumed that they were adulterating coins, and when the extent of their thefts became known to their masters during spot checks, they periodically escaped, only to be caught and put back to work within days. Many were flogged and some were even executed. This seemed like a plausible enough back-and-forth when I read about it in Potosi.

What the documents in Seville revealed was that nearly all of these alleged slave shenanigans were a cover created - and documented -
by the slaves' masters and corrupt mint officials to mask a ballooning debasement scheme worthy of Enron or Bernie Madoff. The narrative
I had constructed from the Potosi documents was colorful and convincing, but now I saw that - like many earlier crown investigators -
I had been fooled by corrupt mint officials and their cronies. Even in trying to read between the lines of these official "criminal" records of slave misbehavior, searching for inconsistencies or suspicious claims, I had learned to trust the words on the page.

Upon discovering this other side of the story in Seville, I realized right away that I would have to start over if I were to get the story right - or closer to it, anyway. My book manuscript would have to be restructured so as to explain not only how Potosi's enslaved African mint workers had been forgotten, but also how these men - and in a few cases women charged with smuggling and fencing - had been maligned and blamed for years for what amounted to global-scale financial fraud. Am I exaggerating? I don't think so. Soon after the scandal broke in 1649 the Spanish crown ordered mass devaluation of Potosi coins all over the empire, touching off a global panic and permanent loss of faith in "the silver of Peru." Since the Spanish government had entirely debased its own coinage to help offset crippling war debts, losing the silver backing of Potosi was devastating. Luckily for Spain, and for the nascent global economy, Mexican silver was beginning to hit the market in significant quantities, and minus the stigma of debasement.