On sixteenth-century criminal law and tax reforms, see Robert O. Crummey, "Reform under Ivan IV: Gradualism and Terror," in Crummey, ed., Reform in Russia and the U.S.S.R. (Urbana and Chicago: University of Illinois Press, 1989), 12-27; Sergei Bogatyrev, "Localism and Integration in Muscovy," in Bogatyrev, ed., Russia Takes Shape: Patterns of Integration from the Middle Ages to the Present (Helsinki: Academia Scientiarum Fennica, 2004), 59-127; N. S. Kollmann, "Frugal Empire: Sources of Russian State Power," in Paul Bushkovitch, ed., Rethinking Russian History (forthcoming). On "noble officials" in the seventeenth century: Robert O. Crummey, Aristocrats and Servitors. The Boyar Elite in Russia, 1613—1689 (Princeton: Princeton University Press, 1983).
Trade, Tax, and Production
No one was going to get rich from taxing the peasant economy in Russia's extreme climate and location. Direct taxes on the populace did provide a steady and important part of the Russian budget, but the state always supplemented with income from export and transit trade. It was transit trade from the forests to the Silk Road that attracted Rus' traders to this part of the world in the ninth century, and capturing trade depots and key river routes determined the directions of Muscovy's territorial expansion. These were the centuries when a truly global economy was developing: European maritime empires were linking already vibrant maritime and overland routes from Africa to Asia and along the old Silk Road into one global nexus of goods, as well as people and ideas. Globalization was not a solely European phenomenon: while their fast and capacious ships exponentially expanded the amount of goods that traversed seas and continents, European traders fit themselves into established trade and merchant nexuses. Overland Eurasian caravan routes, Red Sea maritime trade, busy shipping channels between India, the South China Sea, and Southeast Asia, all provided links and local manpower to the networks that powerful new European ships and navigation made truly global. The challenge to Russia was to join in and hold its own.
This was difficult, as Russia had relatively little to offer in the market. What Russia offered was raw materials of the forest (furs, timber), some semimanufactured goods (hemp, leather), and strategic geography. European merchants coveted Russia's Volga route, seeking a fast and safe passage to markets to the Middle East and beyond. In the seventeenth century Central Asian caravan trade was disrupted, and Russia, busily constructing a network of fortresses along the southern edge of Siberia, offered an alternative route, as Morris Rossabi showed. Hardly a commercial powerhouse, Russia lacked specie, capital, corporations, investment and banking infrastructures, and experienced merchants; it could hardly compete with merchants who possessed all of the above. So Muscovy's rulers navigated these challenges by doing what its peers were also doing in early modern centuries. As Matthew Romaniello remarks, they designed protectionist fiscal policy with an eye to bringing in specie, holding the foreigners at bay and protecting domestic merchants and industry.
At the same time the government engaged actively in domestic fiscal policy, striving to maximize income even from a subsistence agrarian economy and to diversify sources of income by developing industry. Russia's economic policy— protectionist to the outside world, interventionist towards its subjects—in the seventeenth century laid the foundations for what some scholars call its "modernization." The term should be used with caution, as it evokes a model that has been critiqued as Euro-centric (for discounting the greater strength of Eurasian and Asian economies compared to the European throughout the early modern era) and as deterministic, as if early modern trade led inexorably to modern capitalism. Certainly, in Russia such commercialization and economic opening did not occur. Its economic model, like its political one, was state driven and state focused, as befit an ambitious state in a situation of very limited resources. Transit trade, export trade, fiscal and industrial policy, the development of the merchant class—all were shaped by the state for the sake of state income. In taking such a tack, Russia was making the best of its limited natural, human, and political resources and became remarkably successful in its goals.
Russia's foreign trade in the sixteenth and seventeenth century was what Jarmo Kotilaine calls demand driven; Russia profited from selling goods for export and collecting customs on transit goods. It was a simple trade modeclass="underline" most export was in foreign hands and export was generally raw materials. Its balance of trade was good, as Russia did not offer a large market for purchase of foreign goods, certainly in these centuries. There was little wealth to be spent, peasant villages were autarkic (increasingly so as serfdom was established by 1649) and peasant manufacturing relied on locally available raw materials.
Foreign demand for Russian forest goods—naval supplies such as timber, iron, and rope, flax, linen, and leather—from northern Europe, and England in particular—increased exponentially from the sixteenth century. England, France, and the Netherlands were constructing merchant fleets and navies, all dependent on materials that Russia could offer. Furs continued to be in demand for Europe's growing middle classes; burgeoning European regions of textile and leather manufacturing flourished with Russian raw materials. Similarly, demographic growth and commercialization in the Ottoman empire, Persia, and China in these centuries kept demand for Russian furs and raw materials stronger than ever. Russia profited from foreign trade in several ways: by selling monopoly goods (a small portion), by charging protectionist tariffs and by selling monopolies to foreigners.
TRADE ROUTES AND PRODUCTS: THE NORTHERN EUROPEAN CONNECTION
Russia's trade with northern Europe had gone through Novgorod since ancient times, but once Muscovy had conquered that city in 1478, its rulers tried to establish a port on the Baltic to take direct advantage of foreign trade (see Map 2.1). Frustrated in that before 1700, the fortuitous arrival of English merchants in the 1550s kick-started trade between Russia and northern Europe on terms most advantageous to Russia.
As noted in Chapter 2, the English Muscovy company won tax-free trade rights in 1555 after Anthony Chancellor landed on the shore of the White Sea. The Muscovy Company was allowed to maintain warehouses at Kholmogory, Vologda, and even Moscow. By 1557 English were purchasing rope walks in Kholmogory to produce the commodity they most desired for export. They also bought tallow, flax, wax, and other items essential to Britain's growing navy. The English enjoyed virtual monopoly of northern trade until 1581, when Russia lost Narva and could no longer afford to restrict European trade. Dutch merchants were allowed into White Sea trade and by the end of the century their shipments to Amsterdam (sometimes to ports as far as Italy) had surpassed British trade to London in volume. In 1584 Russia founded the port of Arkhangelsk directly on the shore (Kholmogory was some 47 miles or 75 km down the Northern Dvina) to facilitate trade. With shipping possible through the White Sea for a brief window every summer, Russia and its north European partners built Arkhangelsk into Russia's most active trading port by the end of the sixteenth century.