'The view is rapidly gaining currency that not only did Olivares' policies for Spain and its empire not differ markedly from those of earlier Spanish statesmen, but that by and large the results of his manifold endeavours were both few and modest.'

This understanding of the historiography of Olivares' effectiveness from Israel, makes Olivares look unoriginal and ineffectual. However other historians, such as Elliott have been far more sympathetic.

'...the first and the last ruler of Hapsburg Spain who had the breadth of vision to devise plans on a grand scale for the future of a world-wide monarchy: a statesman whose capacity for conceiving great designs was matched only by his consistent incapacity for carrying them through to a successful conclusion.'

Were Olivares' policies a realistic way out of Spain's difficulties or did they aggravate the situation? To understand this I am going to look at both Olivares' foreign policy and domestic policy. Within foreign policy I propose to see how far Olivares pushed the reputacion of the state before domestic crises forced him to seek peace. Among others the best areas to examine would be Olivares' policies during the Thirty Years War from 1622; the Mantuan War 1628-31 and the great revolts of Catalonia and Portugal in 1640. As for domestic policy I will need to look at Olivares' initial reforms of 1623, why they fell through and the effect this had. Furthermore it is important to look at the areas where domestic policy coincides with foreign policy (in a defensive sense) in the Great Memorial, including the Union of Arms. I will also have to find out if Olivares' policies were consistent, or whether they became more and more drastic during his term of office. Firstly though, to understand if the policies were realistic or not, I will have to look into the real problems of Spain. Where exactly did these problems lie and what areas required alteration to keep Spain afloat? From this point I will go on to see the policies in action and from this I will gather whether or not they were realistic.

On an international scale, Spain between 1580 and 1620 was at the crest of her wealth and power. Her supremacy was the dread of all other nations, and therefore its destruction was the cherished object of statesmen for a century. Her galleons ruled the seas and her armies were feared. Yet due to the internally bad reputation that industry and commerce had, Spain's economy was faltering. In comparison with her European neighbours, Spain was industrially, agriculturally and commercially stagnant and wallowing in her old-fashioned militarism. With a vast and newly acquired empire, Spain was rapidly propelled to the front of the world stage, but the costs of maintaining this empire proved crippling. She manufactured very little that her neighbours required, apart from treasure. Yet with the mass influx of gold and silver from the colonies, treasure prices collapsed and in the long term led to rampant inflation.

Years Imports of treasure in millions of pescos Index numbers of prices in silver (taken from the first year i.e. 1580, 1585, 1590 etc.) Index numbers of money wages (taken from the first year i.e. 1580, 1585, 1590 etc.)

Yearly Spain had to acquire more and more wealth to maintain equilibrium and so yearly she spiralled closer and closer to bankruptcy. When silver mines had nothing more to yield or treasure fleets were lost at sea, Spain was forced to borrow on a tremendous scale with foreign bankers. Taxes were raised on an already overtaxed private sector. In some years, all the merchants' profits were seized in order to pay off debts, which either ruined the merchants or forced them to leave the country.

Therefore Olivares came to his ministry at a time when there was an express need for reform. During this time, ideas for reform were mostly forwarded by the arbitristas; literally proposers of reform. However the bulk of their proposals criticised what was directly in front of them. To find the real source of Spain's problems a more global perspective is required. It was not the corrupt pensions and favours sapping Castile of its life and blood; it was military expenditure. The protection of such large and scattered territories was the heart of Castile's difficulties.

From the above one can identify four areas in which reform was desperately required. These areas were: internal corruption; finance; trade and the burden of the empire and military expenditure upon Castile.