The Economic Policies of György Rákóczi I

To the extent that these spectacular trials were intended by György Rákóczi I to intimidate and paralyse his political opponents, they fell short of the mark. He thus continued to take legal action, mostly against wealthy landowners and widows. Since the purpose of treason trials was as much to was enlarge the princely domains as to maintain political order, they came to encompass people of lesser wealth. Rákóczi had reserved for himself even the small properties seized from Sabbatarians, and he would repeatedly institute proceedings in order to obtain a few villages or villein dwellings that might complement one of his estates. His contemporaries were astonished, for no previous ruler had acted in this fashion. The Báthoris had been better known for their grants of property, which they made to buy influence or simply out of folly, while Bethlen had concentrated on expanding the domains of the Treasury. Rákóczi enlarged his own family's wealth to an extent unseen in Hungary since the 16th century, arousing great hostility in the process. Yet, in the final analysis, his accumulated wealth brought relief to his subjects, for Rákóczi applied new techniques to expand princely power.

At first, he had adopted Gabriel Bethlen's approach and resorted to commercial monopolies. The system had to be rebuilt from scratch, for Katalin — who was singularly inept at handling people and defending her interests — had allowed the feudal orders to appropriate this vast source of revenue. It was probably at the instigation {2-117.} of the princely council that she allowed the diet — at its first session during her reign — to enact a law freeing trade in all important export goods (honey, wax, livestock, salt); only the traditional royal monopoly in mineral resources was exempt. Upon paying a set fee, anyone could trade in these goods at home and abroad. The measure greatly weakened the economic base of princely power built up by Bethlen. In 1631, Rákóczi reinstituted the status quo ante. Since the princely council lost its right to supervise state administration, there was little to prevent Rákóczi from legally restoring the prince's monopoly in commerce. The feudal orders voiced only feeble protests; since the termination of free trade seemed unavoidable, they advanced a request — obviously inspired by bad experiences — that the prince's buyers should at least pay the market price and not simply seize the goods. And the following year, they wrote resignedly with regard to Greek merchants: 'May Your Highness ensure that their trading activities serve the greatest benefit of our poor country and of Your Highness's treasury'.[74]74. EOE 9, p. 283. Rákóczi did not concern himself for long with the Greek merchants. In mid-1630, he abandoned the Bethlen approach of comprehensive economic regulation. Giving up on the complex demands of an administered economy, he became obsessed with the acquisition of land; and as the princely domains expanded, his subjects won greater freedom to engage in commerce. He deregulated retail trade, first in honey and wax, then in the other export goods.

When Rákóczi gave up central regulation of the economy, he effectively changed the basis of princely power. Bethlen had followed the practice of contemporary rulers and concentrated on the accumulation of money. Rákóczi accumulated landed property. At the time of his election, he owned — in whole or in part — ten vast domains; by the time of his death, he had gained control of thirty-two domains. In 1648, Rákóczi's domains in Hungary and Transylvania encompassed some 27,000 villein households, or over 100,000 people in his villages and fifty-six market towns. His personal {2-118.} needs were supplied by sixty-four farms and twelve vineyards. The majority of his estates were in royal Hungary, but his fifteen domains in Transylvania encompassed twenty-one market towns (including the princely seat of Gyulafehérvár) and 12,000 villein households. From Lednice (Trencsén County) to Fogarasföld, his vast domains dwarfed all others. If, in royal Hungary, he was the wealthiest landowner, in Transylvania he was predominant.

These economic circumstances gave rise to a peculiarly medieval style of rule. The prince may have been the greatest landowner in the land, but his domains generated a cash income far smaller than the vast sums raised by Bethlen. This income also fell far short of meeting the growing demands on the princely purse.

Yet Rákóczi was seemingly indifferent to this shortfall. He neglected the most evident means of raising funds; at a time when European rulers were commonly increasing taxes, he reduced them. He maintained the tax system adopted by Gábor Báthori and carried over by Bethlen, and, despite steady inflation, held rates at their 1627 level. Under Rákóczi, the basic tax rate was 20 forints, which was no more than 75 percent of the rate in the last year of Gábor Báthori's reign.

György Rákóczi I consolidated his power without relying on the support of the feudal orders. Bethlen had done likewise, but with the explicit goal of turning Transylvania into a significant actor on the international scene. For a long time, Rákóczi lacked such a long-term objective, and he seemed to regard princely power as an end in itself. During his reign, Transylvania was twice drawn into international action, and on both occasions Rákóczi was responding to compelling circumstance.