The era of the Reformation was a tumultuous time for Europe on multiple fronts. Along with the spread of Renaissance ideas and scholarship across Europe, the discovery of the New World and the emergence of the first global empires, the invention of printing, and a host of other developments, Europe was facing an economic crisis known today as the Price Revolution.

The Price Revolution

To understand the Price Revolution, we need to move back two centuries to the 1300s. Between A.D. 1000 and 1300, the European population had more than doubled, and European agricultural production was strained to the limit. Then around the year 1300, the climate shifted, becoming colder and wetter, which shortened the growing season and caused widespread famines.

In 1347 in Sicily and 1348 on the continent, plague arrived. By 1351, approximately 48 percent of the population of Europe was dead, according to the most recent estimates. Normally, after such a massive demographic disaster, population rebounds quickly, but in this case recurring outbreaks of plague kept the population low for a century. It only began to rise again after about 1450.

Economically, one effect of this was to raise standards of living for the majority of people in Europe. The overpopulation problem had been solved, and for the survivors, real wages were up and fixed costs (food and housing) were down. It took until about 1400 before these changes became embedded in society, but in the 15^th century, life was better for most people than it had been a century earlier.

All of this began to change around 1500. By then, population had grown enough that supply and demand led to increased costs for food while leaving the prices of manufactured goods stagnant. The influx of gold and especially silver from the New World also contributed to inflation. The rapid rise in the cost of living is known as the Price Revolution.

Attitudes about Begging

The growing economic stress caused by the Price Revolution led to a significant change in how poverty was viewed. In the Middle Ages, figures like Francis of Assisi extolled the virtues of poverty. In particular, living by begging, which Francis insisted his followers do, was seen as spiritually beneficial: It reinforced humility and living by faith, and gave the wealthy an opportunity to engage in charity.

Along with mendicant (begging) monks, there were many other needs in society that could only be addressed by charity. As a result, a wide array of institutions developed in medieval Europe, most specializing in a single issue—for example, providing dowries for poor girls so they could marry. The result was a kaleidoscope of overlapping and conflicting confraternities and religious orders that handled various needs in the community but that sometimes left less visible segments of the population unserved.

By 1500, attitudes toward wealth and poverty were changing, largely due to increasing economic pressures. Those who worked hard for a living and saw their buying power stretched thinner and thinner grew to resent those who could work but instead lived off the labor of others. At the same time, poverty was seen increasingly as an issue of public morality that needed to be addressed by public means, not by personal charity.

These factors worked together to lead cities across Europe—Catholic and Protestant alike—to pass laws against begging. “Sturdy beggars” who could work but didn’t were literally whipped out of European cities, while the “shamefaced poor”—locals who were old, infirm, or otherwise poor through no fault of their own—were seen as the proper recipients of charity, to whom the cities had responsibilities.

Social Welfare

The cities thus began to rationalize care for the needy. Protestant cities and some Catholic cities cleared away many or all of the old organizations that had been responsible for helping the poor and replaced them with a more systemic approach, generally centered in the town government.

Catholic cities left room for various religious orders and confraternities to continue serving some of the poor as an element of their religious duty. In Protestant cities, however, a tug-of-war sometimes ensued between the pastors, who saw charity as the duty of the church, and the town government, who saw it as a duty of the state.

For example, Martin Bucer, the reformer of Strasbourg and mentor to John Calvin, argued that the diaconate—one facet of the church’s ministry—was responsible for caring for the poor; the town government disagreed and insisted on handling that itself without church involvement.

In Geneva, the situation was more complex. When the town converted to Protestantism in 1536, the Catholic clergy were kicked out and the confraternities shut down. In their place, the city established the General Hospital, an institution that handled all social welfare functions for native Genevans except treating communicable diseases.

The Hospital owned farms outside the city. Orphan boys were sent there to learn farming. The harvested grain was sent to mills owned by the Hospital, where other boys were trained to become millers. The flour produced in these mills went to bakeries—also owned by the Hospital—where other orphan boys were apprenticed to the baker. The bread was then distributed to widows, the injured and unable to work, and the elderly. Orphan girls worked in these and other places as well, learning the skills they would one day need for marriage.

When Calvin arrived in Geneva, he argued that the key officers in charge of the Hospital—the procureurs who did fundraising and the hôpitaliers who did much of the hands-on work—were the two kinds of deacons identified in Scripture. In effect, he baptized those officers, making them simultaneously civil servants and deacons in the church.

Starting in the 1540s, Geneva welcomed increasing numbers of religious refugees fleeing persecution in Catholic countries. This raised a problem for Geneva’s social welfare system: The Hospital only served native Genevans, not refugees. The different refugee communities responded by setting up bourses, or funds, to help the deserving poor in their communities. The largest of these was the Bourse française for the French community, but there was also a Bourse italienne and a Bourse anglaise for the Italian and English communities, respectively. Wealthy members of each of these communities donated money to the bourse, which was then distributed to those in need under the direction of the administrators of the funds.

Significantly, although the people of Geneva rarely thought of the procureurs or hôpitaliers of the General Hospital as deacons despite Calvin’s best efforts, they did typically refer to the administrators of the bourses as deacons. Since in Catholicism, deacons are not responsible for administering alms, this change in terminology shows that Calvin’s understanding of the role of the deacons was taking hold in the city.

Protestantism and the Welfare State

The example of Geneva also points out one of the mistakes Max Weber makes in “The Protestant Ethic and the Spirit of Capitalism.” As we have seen in a previous article, Weber argued that Protestants did not believe in charity, since they believed it promoted laziness. First, rejection of “Sturdy Beggars” was not unique to Calvinism; second, Calvin himself endorsed a system for providing for the poor and gave generously to the Bourse française, the fund for his own refugee community. The cold-blooded  lack of interest in the poor described by Weber does not have its origins in Calvin.

While the development of systemic social welfare institutions in cities was not unique to Protestantism, the state’s ability to assume complete control over care for the poor was only possible in a Protestant environment. While Protestant theologians and pastors attempted to play some role in social welfare, they met with varying degrees of success. The modern welfare state thus has its distant origins in the stresses created by the Price Revolution and in the increasing authority of the state in helping the poor made possible by the Protestant Reformation.