Chapter 2 - The Venetian Empire, before and after the Council of Florence



    Beginning with the nation-building policies of Charlemagne, and continuing under the Salic and Hohenstaufen rulers in Germany, Europe began to slowly recover from the devastation of the Roman Empire and it's aftermath. By the 12th century, population was increasing, as was food production and manufacturing activity. These positive developments were all destroyed by the policies of Venice, particularly after 1200, as Europe was driven into a collapse, resulting in a horror beyond anything in the imagination of even the worst of the Caesars.

    Culturally, unlike the realm of Charlemagne or the Holy Roman Empire, Venice of the 12th through 14th centuries was very much a product of its Roman and Byzantine past. Never conquered during the Goth invasions, a part of Justinian's empire in the 6th century, and inter-married over centuries with Byzantine nobility, the Venetian oligarchy was never really European, but rather a continuation of the ancient Asian empire model of Babylon and its successors. Through the Venetian Senate, the Council of 10, and the later Council of 3, a form of permanent oligarchy was established, whose power lasted well into the 18th century.

    From the period of the first Crusade in 1099 through to the collapse and depopulation of the Black Death in 1347-1351, Europe was dominated by this first manifestation of a Venetian empire. Despite Venice's seizure of Byzantine and other colonies, this was never primarily an empire of geographical expansion, but of maritime and, particularly, financial ascendancy. Unlike Germany, the Low Countries, or France, Venice possessed no industry, save for it's giant military/naval factory, the Arsenal. Their power was in their control over trade, particularly trade between Europe and the East, and in banking and currency manipulation.

    Venice's first partners in creating their empire were drawn from the the Norman nobility of Europe, particularly from France and Angevin England. It was the Normans who acted as the cannon fodder for Venice's wars of conquest, known as the Crusades. Venice also controlled the Black Guelph (Welf) party of the northern Italian cities, allied with the papacy. Beginning with the Guelphs military campaigns against Frederick Barbarossa in 1176, the Venice-controlled Lombard League was born, a group which came to include all of the major cities of northern Italy, with the exception of Milan. These Lombard League cities then served as the centers for the emergence of the usurious Lombard banking system.

    This Venetian-controlled alliance of the northern Angevin nobility, the Guelph-dominated Lombard League, and the Vatican, ruled over Europe, and through the power of the banking houses of the Lombard League, imposed a financial system based entirely on extreme usury and economic looting. 

    Although 13th century Lombard banking is usually associated with the major Florentine banks of Bardi, Peruzzi, and Acciaiuoli, as has been conclusively documented in other locations,1 Venice's control of gold and silver trading made it the actual “godfather” of the Lombard Banking system of this period. Not only the Florentine banks, but increasingly every royal court in Europe, from Naples, to France, to England, to Castile, and even including the papal court at Avignon, came under the domination of Venice's control of silver and gold trading. 

    For more than 100 years, this Venetian-created monstrosity destroyed and looted the continent of Europe. Countries such as Naples and England were driven into bankruptcy; woolen and other production collapsed; food production declined; and, by no later than 1290, Europe began to lose people. Cities, towns, and nations were all ensnared in the Venice-Lombard web of debt and usury. In the absence of sovereign national credit institutions, the Lombard bankers became the de facto creditors and financial dictators of Europe.

    Much like the financial vultures of today, the Lombard bankers not only drove their victims into debt, but used that debt to seize real assets. By 1325, for example, the Peruzzi bank owned all of the revenues of the Kingdom of Naples, the most productive grain belt of the entire Mediterranean area. In Castile and England the entirety of wool production was pledged as collateral for the Lombard loans. The situation in France, Hungary, and elsewhere was similar. Europe was transformed into a gigantic tax farm as local rulers looted their economies and people to send money across the Alps. 

    By 1300 whole sections of Europe were experiencing severe economic decline, food shortages, and loss of population. Continent-wide famines struck in 1314-17, and again in 1328-9. The financial bubble began to burst in the 1320s, with a first wave of Lombard banking failures. Financial doomsday arrived in 1342-1345 with the collapse of the Acciaiuoli, Buonacorsi, Bardi, and Peruzzi banking houses. 

    The bubonic plague swept across Europe from 1347 to 1351, killing an estimated 30 percent of the population, and in many areas far more than 50 percent. From 1351 through to the early 15th century, the population declined further, as disease, famine and economic devastation played themselves out.


The Renaissance & the creation of nation states 

    The horror visited on Europe from 1320 to 1420 destroyed the social fabric as well as the political and philosophical axioms of the medieval world. One result was that, although Venice survived the collapse of the late 14th century, its power was greatly weakened, giving political leaders throughout Europe the ability to throw off the Lombard financial shackles and begin to rebuild their nations. By the early 1400s, the remaining Lombard bankers were being expelled from country after country: Arragon in 1401, England in 1403, Flanders in 1409, and France in 1410. The Venetian ultramontane financial empire crumbled as nations began to exert sovereignty over their own affairs. 

    At the same time , the profound existential nature of the previous century's crisis, created the opportunity, in the 1400s, for a sea-change in philosophical and scientific outlook, including a re-examination of the nature of Man and his role in the universe. 

    Beginning with the revival of the works of the anti-Guelph Italian poet Dante Alighieri – including not only his Commedia, but his political works such as De Monarchia – and the early 15th century translation and publication of Plato's dialogues,2 new ideas in government and human society began to to emerge, ideas coherent with a revolutionary change in Man's self-conception. Many people were involved in this, with the early role of Petrarch being exemplary. 

    The greatest figure of this period was the German churchman Nicholas of Cusa. In his writings On Not-Other and On Learned Ignorance, Cusa refuted the medieval scientific methodology of Aristotle and Euclid, returning science to its Platonic/Pythagorean origin. In The Catholic Concordance Cusa established the principle of the Commonwealth, a nation state based on the principle of agapé, of the Common Good, and in his On the Peace of Faith, he presented the basis for an ecumenical peace among nations.

    Cusa's life work, almost universally ignored in the history books of today, represents one of the greatest revolutionary interventions in all of human history. In his scientific and mathematical writings, Cusa destroyed Aristoteleanism, and returned science to its rightful domain of hypothesis and human creativity. For Cusa, Man was not a beast, a farm animal, or a slave, but each human being was a creature endowed with creative reason. From Cusa's influence came the great Dome built by Flippo Brunelleschi, constructed on the principle of the catenary, at the Santa Maria del Fiore Cathedral in Florence; the breakthroughs in dynamics and perspective by Leonardo DaVinci; the map of Toscanelli which provided Columbus with a route to the New World; and many, many other radiating effects. 

    Cusa organized the great 1439 Council of Florence, which brought leaders from throughout Europe into an agreement on the agapic principle of the filioque, and established the basis for a new civilization,3 built on the principles, of human reason, the Common Good, and national sovereignty. 

    In 1461 Louis XI ascended to the throne of France, and proceeded to establish the first modern sovereign nation-state, based on Cusa's Commonwealth principle.4 Allied with the Medici in Florence, Louis proceeded to build ports, roads, schools, printing houses, industry, and infrastructure. He provided support for the cities, created a national currency, and broke the power of the feudal baronies. These are Louis' own words, taken from his book Le Rosier des Guerres (The Rosebush of Wars):

Considering that the characteristic of Kings and Princes and their Knights, is that their estate and vocation is to defend the common good, both ecclesiastic and secular, and to uphold justice and peace among their subjects, and to do good, they will have good in this world and in the other and out of doing evil will only come grief; and one must count one day on leaving this world to go and give an account of one's undertakings and receive one's reward. And to expose their lives for others, of which among all other estates of the world is most to be praised and honored. And because the common good which concerns many, which is the public matter of the Realm is more praiseworthy than the particular, by which the common good is often frustrated; we have gladly put in writing the deeds of princes and of their knights and all the good tenets that served their cause....

    Read the above quote again, and then compare what Louis says about the Common Good, with the notions of Roman Law and the policies of the Lombard League discussed above. Nicholas of Cusa’s discovery of the Commonwealth principle – a discovery of an actual universal principle – was one of the most profound revolutions in human history, and it produced a sea-change in the political organization of humanity.

    Louis XI’s example was contagious. In 1485, Henry Tudor, who had lived in Brittany and France during the reign of Louis, invaded England, overthrew the last of the Plantagenet kings, Richard III, and established Tudor rule. As king, Henry VII adopted the same methods of national economic development and sovereignty, that Louis had pursued in France. Like Louis he attacked the power of the feudal nobility, and implemented national policies inspired by the principle of the Common Good. As had occurred in France, food production, national income, and population all increased, for the first time in more than a century. These initiatives in sovereignty and nation-building were not limited to France and England, but affected the Iberian peninsula, Flanders, and elsewhere. Taken together with the revolution in science undertaken by Nicholas of Cusa and his allies, a new future for mankind seemed to be at hand. With the success of Columbus' trans-Atlantic voyage in 1492, the chance to annihilate the old feudal oligarchic order was unfolding. As Desiderius Erasmus declared to Thomas More in a 1499 letter, humanity seemed poised at the dawn of a “new era.”


Venice against the Commonwealth 

    Erasmus was not wrong in his assessment. The establishing of sovereign nation-states in France and England, together with the radiating influence of Cusa’s revolution in science, threatened the very existence of the Venetian system of usury and slavery. But the Venetians fought back.

    Demonstrating the same oligarchical arrogance as that of the Olympian gods, the first reaction of Venice to these revolutionary changes was to try to force the genie back in the bottle, to reimpose the feudal world of usury and Aristotle by force and bloodshed. And Venice still possessed the means to try. In the mid-fifteenth century Venice was still the most powerful maritime nation in Europe, controlled Europe's slave and bullion trade, maintained the most extensive political intelligence operations on the continent, and was the home of the most influential center of Aristotelean scholarship in Europe, the University of Padua.

    To this end Venice turned to new allies, the Hapsburg dynasty, first in Austria, then in Spain. As part of this Hapsburg operation, the Venetians created a new financial front to replace that of the defunct Lombard bankers – the House of Fugger. Jacob Fugger, an insignificant Austrian spice trader residing in Venice, was picked up by the Venetians and made their agent in control of most of the silver and copper mines in central Europe. From the vast wealth accumulated in these operations, Fugger created the most powerful banking house in Europe, and then bankrolled the Austrian Hapsburgs, previously only second-tier German nobility, into control of the Holy Roman Empire.

    In 1518, utilizing a series of dynastic marriages, the Hapsburgs took control of Spain and the Fuggers became also the bankers to the Spanish monarchy. After the Spanish bankruptcy of 1575, the Fuggers were replaced as the financial controllers of the Spanish crown by Venice's junior partner, Genoa. But for Venice, that just meant substituting one proxy for another.5

    In essence, the 14th century Black Guelph party was reborn as the Holy Alliance, a Venice-Hapsburg-Vatican axis, with Venice in direct control of the Papal Curia. Venice also controlled the policies of Spain through its Fugger and Genoese allies, who, as the creditors to the Spanish government, drained off all of the loot from Spain’s massive traffic in gold, silver, and slaves, manipulated every aspect of Spanish policy, and drove the Spanish Crown into bankruptcy several times. At the same time, Venice launched an all out counterattack against the revolution in science initiated by Nicholas Cusa and his followers. Like Zeus they thought they could outlaw man’s access to fire through the use of imperial force. This effort culminated in the 1545-1563 Council of Trent, which attempted to reimpose Aristotelean rigidity, essentially by Papal decree. The mastermind of this so-called “Catholic Counter-Reformation” was the Venetian Cardinal Gasparo Contarini.

    At the heart of this Venetian counteroffensive was the use of terror. Sheer barbaric terror. With the initiation of the Spanish Inquisition in 1478, under the direction of Tomás de Torquemada, Europe was drenched in bloodshed, setting off the Wars of Religion which did not end until 1648. Waves of mass killings, persecution, and inflamed passions engulfed Europe, the victim of which was the humanist ideals of the Renaissance.6 The ensuing decades of partisan religious warfare, creating almost a continent-wide psychosis, were a hammer, aimed at shattering the development of sovereign nation-state commonwealths.7


The end of the Old Regime 

    Ultimately, this Venetian strategy didn’t work. By the early 16th century the geopolitical crisis facing Venice was an inescapable reality. The war of the League of Cambrai, from 1509 to 1513, when foreign troops had entered the Venetian Lagoon, had exposed the military vulnerability of Venice's defenses. In addition, by mid-century, Venice was threatened with the loss of not only her colonies, but her entire access to trade with the east, at the hands of the Ottoman Turks. Despite the Venetian-Hapsburg-Papal victory at the 1571 Battle of Lepanto, Venice lost Cyprus and other colonies, and was forced to sign a humiliating treaty with the Turks in 1573. Economically, Venice began to hemorrhage. Between 1560 and 1600, the size of the Venetian merchant marine shrank by one half. In 1560 a banking crisis struck, lasting into the 1580s. This was a total collapse, such that by 1584 every private banking house in Venice had closed.

    At the same time, the explosion of trans-oceanic travel had created an entirely new strategic reality. Small but significant numbers of Europeans began to emigrate, particularly to the Western Hemisphere, hoping to escape the old world oligarchical matrix. Venice was in no position to meet this challenge of the New World, to undertake the task of imposing a global maritime empire. 


The Modern Anglo-Dutch Empire     Perhaps, if Venice had stuck to its reactionary methods, it could have found a way to overcome its difficulties and deal with most of the challenges mentioned above. But there was one problem that could not be solved using the old medieval methods. The idea of the Commonwealth – together with unprecedented scientific and technological progress – had been unleashed by the Renaissance. The zero-growth world of feudalism was forever dead. Despite all of the Venetian-inspired bloodshed and intrigues, human progress was on the march, and some in Venice realized that the new ideas of scientific progress and national sovereignty could not be stopped by the Spanish Inquisitor's torture chamber.

    After 1513, new initiatives were taken to transform certain fundamental features of the Empire, to change it in order to save it. A new direction was required. This all played out over a period of several decades, with important inputs from Italy, Flanders, Spain, and elsewhere, but, ultimately, the creation of a new model of Empire would have to come from a new leadership in Venice itself.



1 Money and Banking in Medieval and Renaissance Venice, by Frederick C. Lane; and How Venice Rigged the First, and Worst, Global Financial Crash, by Paul Gallagher, Fidelio, Vol. 4, No. 4, 1995

2 The Renaissance and the Rediscovery of Plato and the Greeks, by Torbjorn Jerlerup, Fidelio, Vol XII, No.3, 2003

3 Nicholas of Cusa and the Council of Florence, by Helga-Zepp LaRouche, Fidelio, Vol. 1, No. 2, 1992

4 The Commonwealth of France's Louis XI: Foundations Of The Nation State, by Pierre Beaudry, New Federalist, July 3, 1995

5 Genoa had been subservient to Venice ever since her defeat by Venice in the 1380 Battle of Chioggia. Previously, Genoa was also a loyal member of Venice's Lombard League syndicate.

6 "Two poor creatures have been burnt, and the whole city has turned Lutheran... Either I am blind or they aim at something else than Luther. They are preparing to conquer the phalanx of the muses." - in a letter from Erasmus to Thomas More, 1523

7To understand the face of this evil, see Friedrich Schiller's Don Carlos