Through a policy of alliances with other European nobility and the conquest of most of South America and the West Indies, Spain began to establish itself as an empire. The Treaty of Tordesillas, negotiated by Pope Alexander VI between Portugal and Spain, effectively divided up the non-European world between these two budding empires. Massive amounts of gold and silver were imported from the New World into Spain's coffers. However, in the long run this hurt the Spanish economy much more than it helped it. The bullion caused high inflation rates, which undermined the value of Spain's currency. Additionally, Spain became dependent on her colonies for income, and when Queen Elizabeth I of England began to capture Spanish vessels on the way to and from the New World, Spain suffered massive economic losses. These effects, combined with the expulsion of Spain's most economically vital classes in the late 15th century (the Jews and the Moors), caused Spain's economy to collapse several times in the 16th century, bringing the Golden Age of Spain to a close.
Mistreatment of the Moorish population in Morocco led to an uprising and the loss of all North African possessions except for the enclaves of Ceuta and Melilla in 1921. Abd el-Krim, Annual. In order to avoid accountability, the king Alfonso XIII decided to support the dictatorship of general Miguel Primo de Rivera.
With the approval of the Spanish Constitution of 1978 and the arrival of democracy, the old historic nationalities — Basque Country, Catalonia, Galicia and Andalusia— were given far-reaching autonomy, which was then soon extended to all Spanish regions, resulting in one of the most decentralized territorial organizations in Western Europe.
In 1499, about 50,000 Moors in Granada were coerced by Cardinal Cisneros into mass baptisms and conversion. During the uprising that followed (known as the First Rebellion of the Alpujarras), people who refused the choices of baptism or deportation to Africa, were systematically eliminated. What followed was a mass flee of Moors, Jews and Gitanos from Granada city and the villages to the mountain regions (and their hills) and the rural country, however by 1500 Cisneros reported that "There is now no one in the city who is not a Christian, and all the mosques are churches".
Spain suffered a shocking terrorist attack, the March 11, 2004 Madrid attacks on its capital's commuter train network, killing 200. Al-Qaeda has been blamed for this attack. Some have attributed the fall of the Aznar government to this attack, which took place just two days before the 2004 elections. At first the public believed ETA was responsible for the bombing. When they learned Al-Qaeda was the true culprit, many voters lashed out at the media and Aznar's government, believing the two had colluded to deceive the public.
According to the latest official poll, 80% of Spaniards self-identify as Catholic, 12% as non-believer, and 1% as other (the remaining 7% declined to state). Of the 1.4% identifying as other, 29% identified as Evangelical Christian, 26% as Jehovah's Witnesses and 3% as Muslim (the rest either mentioned smaller religions or declined to state). According to the same poll, 73% believe in God, 14% don't and 12% are unsure (1% declined to state). Additionally, according to this poll, only 41% believe in Heaven. 24% of the Spaniards think that the Bible is just a fable. Only 25% of Catholics go to church at least once a week.
At present, Spain is a constitutional monarchy, and is comprised of 17 autonomous communities. One of the most important problems facing Spain today is ETA's terrorism - this illegal organization defends Basque independence through violent means, which is condemned by both Central and Basque government, although there is tension between these governments since PNV (the party presently governing Basque Country) longs for greater autonomy from Spain, including the possibility of independence, something Spanish government doesn't accept.
On February 20th 2005, Spain became the first country to allow its people to vote on the European Union constitution that was signed in October 2004. The rules states that if any country rejects the constitution then the constitution will be declared void. The final result was very strongly in affirmation of the constitution, making Spain the first and so far only country to approve the constitution via referendum.
Philip V, the first Bourbon king, of French origin, signed the Decreto de Nueva Planta in 1715, a new law that revoked most of the historical rights and privileges of the different kingdoms that conformed the Spanish Crown, unifying them under the laws of Castile, where the Cortes had been more receptive to the royal wish. Spain became culturally and politically a follower of France. The rule of the Spanish Bourbons continued under Ferdinand VI and Charles III. His son Carlos IV was truly incompetent (some say mentally handicapped), and under his reign Spain fell to the armies of Napoleon.
The latter years of Franco's rule saw some economic and political liberalization, the so-called Spanish Miracle, including the birth of a tourism industry. Francisco Franco ruled until his death on November 20th 1975 when control was given to King Juan Carlos. In the last few months before Franco's death, the Spanish state went into a paralysis. This was capitalized upon by King Hassan of Morocco, who ordered the 'Green March' into Western Sahara, Spain's last colonial possession.
In the 1960s, more than a decade later than other western European countries, Spain began to enjoy economic growth and gradually transformed into a modern industrial economy with a thriving tourism sector. Growth continued well into the 1970s, with Franco's government going to great lengths to shield the Spanish people from the effects of the oil crisis.