There were comparatively few holdings in the hands of peasant proprietors, or small farmers, and this absence of a home and land owning population was an obviously weak element in the foundation of the government. The greater part of the productive soil was in the hands of a few grandees, and the wealth extracted from it was withheld from general circulation, which had, among other harmful consequences, that of retarding the extension of agriculture and general industrial advancement. Judged by our present conceptions of justice and policy, the commercial regulations imposed upon Cuba by Spain appear to have been extremely foolish and iniquitous, but we must bear in mind that they were quite consistent with the prevailing idea at that time that the interests of colonies should be made subservient to those of the parent country. In other words, the commercial and industrial restrictions which were imposed on Cuba, while they had the effect of exploiting the Island for the benefit of Spain, originated not so much from disregard of the colony’s welfare as from the peculiar views of political economy generally entertained in that age. Great Britain’s American possessions were subjected to similar treatment. Spain’s fatal error lay in the tenacity with which she clung to her misguided policy. A little judicious reform at the beginning of the last century, when other powers were granting to their colonies a measurable degree of freedom in trade and self-government, would probably have sufficed to keep Cuba under the flag of Spain. The restrictions on the commerce of the Island began with the royal decree of 1497, which granted to the port of Seville the conclusive privilege of trade with the colonies, these being prohibited from any commercial intercourse with any foreign countries. In 1707 this monopoly was transferred from Seville to the port of Cadiz. While it was the capital of the Island, Santiago was the sole port of entry, and after Habana became the capital, all shipments passed through it. This restricted traffic between Spain and its insular colony was jealously guarded. Trading vessels were required to assemble in _flotas_, or fleets, and to make the double voyage under the escort of war-ships. This arrangement was designed hardly as much for protection as for the prevention of illicit dealings with the intermediate countries. During certain periods trade with foreigners was prohibited under the most severe penalties, and it was never permissible except by special authorization. Commercial intercourse between the colonies was even forbidden. With the exception of a brief term, during which the English occupied the Island, these hampering [Illustration: THE WATER-FRONT, HABANA.] conditions obtained until 1778, when Habana was opened to free trade. The decree authorized traffic between several ports of Cuba. Others were included in this privilege, from time to time, until, in 1803, practically all the ports of the Island enjoyed it.