Hispanic American Historical Review 80.4 (2000) 839-864
The breakdown of the Portuguese-Brazilian empire has been a topic of controversy for a long time. The dispute has converged on matters of fact as much as on matters of interpretation. Historians on both shores of the Atlantic have failed to present a common perspective on basic issues, such as the nature and scope of the growth that preceded the collapse, or the timing, duration, and intensity of the crisis itself. Thus a variety of explanations have been offered for this major turning point, as scholars tried to analyze the consequences of the collapse of the old colonial system.
However, beyond the controversy, the crucial significance of this period for the now diverging history of the two countries must be universally admitted. For Brazil, of course, this was the time of the birth of the nation, when crucial choices were made and many possible lines of historical development were discarded. Similarly, for Portugal this turn of events was very important. It meant that for the first time in nearly four hundred years the country had to sustain itself without an empire. The remaining colonies, that is, the trading posts and fortresses in Africa and in Asia, had virtually no economic or financial relevance. For almost a century the empire, or what remained, played a minor role in the Portuguese economy and, wishful expectations to the contrary notwithstanding, could not compensate for the loss of the vast American colony. As a result, Portuguese society had to undergo fundamental socioeconomic adjustments to accommodate this historical development.
The climacteric nature of this historical process is unquestionably related to the contentious character of the interpretations it has elicited. Bearing this in mind, this essay presents the facts and reviews the main topics of this historiographical controversy. As an active participant in the controversial debates on this topic, I will refrain from restating my former arguments, although this certainly is an excellent opportunity to make them accessible to an English-speaking audience. My aim is to offer a fresher analysis of the available evidence, with the assistance of the most recent research, and thus extend our knowledge of this critical period in the history of Portugal, Brazil, and the Atlantic world.
For the Portuguese empire, the beginning of the second half of eighteenth century spelled disaster. In 1755 a tremendous earthquake and the ensuing fire destroyed the best part of the city of Lisbon as well as the cargo of the fleet from Brazil, which was stored in the customs warehouses. The damages were huge and they had scarcely begun to be assimilated when a second blow caused another shock. Gold remittances from Brazil, which had been for some decades the most important financial resource in the empire and had become the major driving force behind its integration into the Atlantic economy, began faltering. The decline, which could already be felt in 1760, became very serious after 1766. This problem led to significant financial strains in the mother country and caused an inadequate supply of hard currency that was required to settle international payments, a difficult task for a country with a chronic trade deficit. Consequently, the government of the marquis of Pombal hastened the economic reforms it had already initiated in the previous decade.
The government aimed first at the reorganization of both the colonial trade and the main export sector in the metropolitan economy. It specially regulated the sugar and tobacco trade (1756) and created three monopolistic companies, two of which were granted exclusive rights over shipping and trade with specific regions of Brazil while the third was entrusted with the control over the marketing of Port wine. Pombal tried to secure a tighter control over long-distance trade (although the fleet system to Brazil was abolished), which he wished to see concentrated in the hands of a smaller mercantile elite (presumably more adept at competing with the foreign merchants). The main purpose of this program was to cutback the large deficits of the balance of trade. To this effect, he later encouraged import-substitution, and devised an ambitious plan to promote manufacturing...