Regency years Since Charles was a legal minor when Philip died on 17 September 1665, Mariana was appointed Queen
Regent by the
Council of Castile. The
Spanish Empire remained an enormous global confederation, but its economic supremacy was increasingly challenged by
England and the
Dutch Republic, and its position in Europe seriously weakened by the expansionist policies of
Louis XIV of France. Meeting these challenges was hampered by Mariana's power struggle with Charles's illegitimate elder half-brother,
John Joseph of Austria, known as Don Juan. Enacting reforms was complicated because Spain was a
personal union between the
Crown of Castile and
Crown of Aragon, each with very distinct political cultures and traditions. , , Regent for Charles during his minority While infighting between those who ruled in Charles's name during his regency did little to help, it is debatable how far they can be held responsible for long-term trends predating his reign. The monarchy proved remarkably resilient, and when Charles died, remained largely intact. However, government finances were in perpetual crisis, the Crown declaring bankruptcy nine times between 1557 and 1666, including 1647, 1652, 1662, and 1666. As her husband Philip had done, Mariana ruled through a "", the first being her personal confessor and fellow Austrian,
Juan Everardo Nithard. His most urgent task was ending the costly wars with
France and
Portugal, which he duly achieved through the 1668 treaties of
Aix-la-Chapelle and
Lisbon. Despite acknowledging their necessity, in February 1669 Don Juan forced Mariana to dismiss Nithard. She replaced him with
Fernando de Valenzuela, a member of the lower class, whose appointment was resented by the
Grandees who normally filled such positions. In 1673, Spain was drawn into the
Franco-Dutch War, placing additional strain on the economy, and Don Juan renewed efforts to remove Mariana as Regent. A month before Charles became a legal adult on 6 November 1675, he indicated his intention to take control of government, supported by his brother. When the Regency Council requested a two-year extension of their office on 4 November, Charles initially refused, but was later pressured into accepting. He was also forced to issue a Royal Decree ordering Don Juan to leave Madrid. , whose political feud with his mother undermined the stability of his regime Don Juan finally gained control of the government in January 1678 and exiled Valenzuela to the
Philippines. His first action was to make peace with France in the 1678
Treaties of Nijmegen, with Spain ceding
Franche-Comté and areas of the
Spanish Netherlands returned in 1668. Seeking to minimise future conflict between the two countries, in August 1679 Don Juan brokered a match between Charles and the 17-year-old
Marie Louise of Orléans, eldest niece of Louis XIV and daughter of
Philippe I, Duke of Orléans. Arranging the marriage was Don Juan's last significant act; he died shortly before it took place in November 1679. In February 1680,
Juan Francisco de la Cerda, 8th Duke of Medinaceli became the new . He clashed with Marie-Louise over the alleged influence exerted over her by the French ambassador,
Pierre de Villars, who was expelled from Madrid in 1681, badly affecting the relationship between the two. Medinaceli was further undermined by economic problems and the loss of
Luxembourg following the 1683
War of the Reunions. In June 1684, he sought to bolster his support by appointing the
Count of Oropesa as President of the
Council of Castile, the second most powerful position in the state. However, continuing ill-health led him to resign in April 1685, with Oropesa taking over as de facto . He retained this position until 1690.
Economy The so-called "
Little Ice Age" of the 17th century was a period of crisis throughout Europe, leading to poor harvests and economic decline. Spain was especially affected, due in part to the parlous economic situation, particularly in Castile, where the population dropped from 6.5 million in 1600 to fewer than 5 million in 1680, whilst figures for Spain as a whole were 8.5 to 6.6 million. This was exacerbated by a series of wars with France and the need to defend the Empire, which were a constant drain on public expenditure. In 1663, Philip IV had converted state debt into
government bonds (
juros) but high rates of interest meant taxes were often assigned to creditors years in advance to pay current liabilities. Although silver bullion imports from the Americas increased, the vast majority went to paying off foreign debtors. The globalisation of the Spanish trading system meant foreign interests often had the most to lose from its collapse. By the 1670s, exports were primarily controlled by Dutch and English merchants, while the domestic economy relied on French labour and imported wheat. A senior colonial official observed in 1687 that the Empire continued to exist "only because it enables the English, Dutch and French to exploit [it] more cheaply". One consequence of Spanish economic and demographic weakness during this period was the inability of the
Spanish Navy to protect their own merchant shipping. In response, the government issued royal decrees in 1674 and 1692 establishing a formal system of
privateering in the Spanish coastal territories, known as the
guarda costa outside Europe. Hundreds of privateers were commissioned during the last decade of Charles' rule, a policy continued by his successors. Charles himself acquired at least one corsair ship in 1684, the
San Antonio, in order to encourage private initiative. In the 1680s, Spanish officials issued a series of drastic deflationary decrees, revaluing the coinage at 25% of its previous value. The immediate impact was the total disruption of commerce and collapse of financial credit; in response, debtors were given three months to repay government debts using the existing rate, later extended to six months. Having stabilised the position, however, in 1686 the coinage was readjusted to a more favourable rate and thereafter left unaltered. ==Succession conflict and death==