Part 1196

Antwerp, the great capital of trade, stood foremost in the struggle, as became its greatness, and it suffered correspondingly. The death-blow to its fortunes was given in 1585, when, after a siege that is almost unexampled, it was taken by the Spaniards under Alexander Farnese, Duke of Parma, and given up to pillage and slaughter. Its surviving inhabitants fled in large numbers, the greater part of them to Holland, some to England, and some to other countries. Commerce abandoned the port. The chief merchants who had made it the center of their undertakings chose Amsterdam for their future seat of business, and that city rose at once to the commercial rank of which Antwerp had been stripped by the stupid malice of its Spanish sovereign. While the Belgian Netherlands fell hopelessly under the fatal despotism of Spain, the Dutch Netherlands fought their way slowly to independence, which Spain was forced to acknowledge in 1648. But long before that time the Dutch Republic had become a power in Europe—much greater in every way than Spain. Its foundations had been laid by the union of the seven provinces of Holland, Zealand, Friesland, Utrecht, Groningen, Overyssel and Gelderland. It had grown firmer and stronger year by year, and the people, after a time, had not only found themselves able to thrive generally in the midst of their desperate war with Spain, but the war itself opened their way to wealth and power. They learned, early, as we have seen, that they could attack their enemy to the best advantage at sea. In pursuing this ocean warfare they were led on to the East and West Indies, and soon broke, in both regions, the exclusive power which the Spanish and Portuguese had held. When Portugal was dragged into a fatal union with Spain, under Philip II., it had to suffer the consequences of Philip's wars, and it bore more than its share of the suffering. The Dutch and the English forced their way pretty nearly together into the eastern seas, and, between them, the Portuguese were mostly driven out. They divided the rich commerce of that great Asiatic and Oceanic region, and, for a time, the most lucrative part of it was gained by the Dutch. While the English got their footing on the coasts of Hindostan and were laying the foundations of their future empire in India, the Dutch gained control of the spice-growing islands, which, in that day, were the richer commercial prize. The first Dutch fleet that rounded the Cape of Good Hope and made its way into East Indian waters, sailed under the command of one Cornelius Houtmann, who had been in the service of the Portuguese and learned the route. He started in 1595 with four ships and returned, after a voyage of eighteen months, with only two. He had lost more than half his men, and he brought back very little cargo to pay for the adventurous undertaking. But the Dutch were well satisfied with the experiment; they knew that more experience would lead to better success. Another fleet of eight ships was sent out in 1598 and when four of them returned the next year with a precious cargo of spices and other merchandise from Java, which they had procured very cheaply in exchange for the cloths, the metal wares and the trinkets that they took out, the delight of the nation can hardly be described. Part of the fleet had remained in the East to hold and strengthen the position they had gained, and other ships were sent speedily to join them. Very soon the armed merchantmen of the Dutch were thickly swarming in that part of the world, ready for fight or for trade, as the case might be. So many companies of merchants became engaged in the business that too lively competition between them occurred and they threatened to ruin one another. But that danger was overcome in 1602 by joining the rival interests together in one strong association, to which the government gave exclusive rights of trade in the East. Thus the Dutch East India Company was formed, in which the merchants of Amsterdam, Rotterdam, Delft and other cities of the republic put their capital together. By its charter, this great company held powers of war as well as of commerce and it used them both with prodigious energy. At first, the chief trading stations of the Dutch in the East were at Bantam, in Java, and Amboyna, one of the group of the Moluccas or Spice Islands; but the city of Batavia, which they founded in Java in 1619, became afterwards their principal seat of trade and the capital of their surrounding possessions. The chief aim of the Dutch was to gather into their hands the profitable commerce of the island world of the Eastern Archipelago, but they did not fail to pursue their Spanish and Portuguese enemies in other quarters, where the chances of traffic looked inviting. They seized positions on the Guinea coast of western Africa and took their full share of the trade with its savage natives, who gave gold dust, ivory, ebony, gums, wax, ginger, pepper, palm oil, various choice kinds of wood, and slaves (for the West Indies and America, when the plantations there began to want labor), in exchange for trinkets and cheap goods. They also occupied and colonized the Cape of Good Hope, which the Portuguese had neglected, and made it, in time, a very prosperous and valuable possession. That they should carry their war with Spain into the West Indies and to the American coasts, was a matter of course. In 1623 a Dutch West India Company was chartered, to organize these operations in the western world, as the East India Company had organized undertakings in the East. {3717} But the West India Company was much less commercial and much more warlike in its aims than the corporation of the orient. Its first object was to take spoils from the enemy, and it found the prizes of war so rich that not much else was thought of. On the North American continent, a most important lodgment was made, as early as 1614, at the mouth of the Hudson River, where the colony of New Netherland was founded. In this quarter, as everywhere, the Dutch and English were rivals, and before many years they came to open war. In the series of wars which followed (1652, 1665, 1672), and in the long contest with Louis XIV. of France which they shared with England, the Dutch expended more of their energies than they could afford. The English, with their well protected island, rich in soil and in minerals, had heavy advantages on their side, when once they had acquired the knowledge of commerce and the ability in labor which enabled them to compete with the Dutch. To the latter nature had always been wholly unfriendly. They had fought against circumstances at every step in their history, and had won their wealth, their knowledge, their high importance and influence in the world, by sheer hard work, tireless patience and indomitable will. But the natural advantages against which they struggled were sure to overcome them in the end. It must be said, too, that they did not grow in character as their fortunes rose. It is not difficult, therefore, to account for the fact that the Dutch nation slowly slipped back, during the 18th century, from the high and leading position in civilization to which it had climbed, and lost by degrees its commercial supremacy, while the English nation came to the front.

COMMERCE: MODERN: The English: 16-17th Centuries. Commercial progress. The East India Company.

As English commerce slowly freed itself from foreign hands, it fell under the control of monopolies at home. The merchants of the Middle Ages, in England and elsewhere, had formed themselves into societies, or guilds, just as the artisans and mechanics in different trades had done. Such associations had originally grown out of the disorderly state of the times, when government and law were weak, and when men who had common interests were forced to unite to protect themselves, and to establish customs and rules for regulating their business affairs. But the guilds almost always became, in time, oppressive monopolies, each acquiring, in its own department of business, such exclusive rights and privileges as practically shut out from that business all persons not admitted to its membership. This occurred among the merchants, as it did elsewhere, and English commerce grew up under the control of various societies of "Merchant Adventurers," as they were called.

See MERCHANT ADVENTURERS (page 2153).

The disputes and contests of these companies, at home and abroad, and their suppression of individual enterprise, appear to have hindered the growth of English commerce for a long period. But it did grow steadily, notwithstanding, and through the reigns of Henry VIII. and Elizabeth, the number of English ships set afloat and of English merchants trading abroad, was rapidly multiplied. Meantime the English people gained skill in weaving, dyeing and other arts, and were fast extending the manufacture at home of their own famous Wool. This, in turn, made the sheep farming more profitable, and so much land was taken for that purpose that other products were diminished and most articles of food rose in price. That occurrence caused grave anxiety, and the meddling statesmen of the time, who thought that nothing could go well if their wisdom did not regulate it by law (as too many meddling statesmen think yet) began to frame acts of Parliament which directed how farming lands should be managed and how many sheep a single farmer should be permitted to own. The same kind of statesmanship took alarm at the spread of weaving, in a small way, among industrious villagers and country people, who set up looms and made and sold cloth, outside of the guilds of the town weavers. So the complaints of the latter were listened to, and Parliament forbade weaving to be done outside of certain towns, except for home use in the family of the weaver. There was much of that sort of legislation during Tudor times, and the industry and enterprise of the country had to struggle long and hard for freedom to fairly exercise themselves. But in spite of meddling statesmen and tyrannical monopolies, the people went all from year to year, learning more, doing more, producing more, wanting more, buying and selling more, and living in a better way. After about 1511, there appears to have been a considerable direct trade growing up between England and the countries of the eastern Mediterranean (the Levant), and consuls, to look after the rights and interests of English merchants, began to be appointed, at Candia, and elsewhere, as early as 1530. The voyage from London to the Levant and return then occupied from eleven months to a year. About 1535 the English made their appearance as traders on the Guinea coast of West Africa, disputing the exclusive rights which the Portuguese claimed there, and in 1537 they opened trade with the Moors of the Barbary coast, in northern Africa. In 1553 a chartered company of London merchants was formed with the object of exploring for a northeastern passage to China, around Europe, through the Arctic seas, as a means of dividing the trade of the East with the Portuguese, who controlled the southern route, around Africa. This is believed to have been the first joint stock corporation of shareholders that was organized in England. Sebastian Cabot, then "Grand Pilot of England," was at the head of it. The northwestern passage was not found, but the company opened a trade with Russia which proved to be exceedingly valuable. Accepting this, in lieu of the China trade which it could not reach, it became, as the Russia Company, a rich and powerful corporation. The success of the Russia Company stimulated the adventurous disposition of the English people and set other enterprises in motion. But still more energy was roused by the hostility of national feeling toward Spain. The destruction of the Armada broke the Spanish naval power and made the English bold. They began to navigate the sea from that time with intent to become its masters, though the Dutch were still superior to them in maritime strength and experience. During the reign of Elizabeth there rose a new race of Vikings, very much like the old Norse heroes of the sea, and pursuing a very similar career. {3718} The most daring and most famous among them, such as Grenville, Drake and Hawkins, were more than half pirates, and their voyages were chiefly expeditions for plunder, directed against the Spaniards and Portuguese. The trade which they first gave attention to was the trade in negro slaves. But those piratical adventurers of the 16th century made England the "mistress of the seas." They trained for her a body of sailors who were able in time to more than cope with the Dutch, and they opened the newly known regions of the world for her merchants and colonists to spread over them. Before the end of the 17th century, the English had become the foremost power in the western world and were making the most of its opportunities for production and trade. Meantime they were pushing their way with equal energy in the East. On the last day of the year 1600 the "Company of Merchants of London trading into the East Indies," which became afterwards so great and famous as the "East India Company" of England, was chartered by the Queen. The Company sent out its first fleet of five vessels in 1601. The expedition returned, after an absence of two years and seven months, richly laden, in part with pepper from Sumatra and in part with the spoils of a Portuguese ship which it had captured in the straits of Malacca. It had settled a trading agency, or factory, at Bantam—and that was the beginning of the vast empire which England now rules in the East.

See INDIA: A. D. 1600-1702 (page 1709).

COMMERCE: MODERN: The English: 17-18th Centuries. The Colonial or Sole Market Commercial System.

"The doctrine that the commercial prosperity of a country depends on the creation, maintenance, and extension of a sole market for its products and for its supplies, was prevalent from the discovery of the New World and the Cape Passage down to the war of American Independence. This was the principal object of Borgia's Bulls. This was what animated the Dutch, in their successful, in the end too successful, struggle, after a monopoly of the Spice islands. This was the motive which led to the charters of the Russian Company, the Levant Company, the East India Company, the Turkey Company, the Hudson's Bay Company, in England. The theory was organized in the colonial system, which Adam Smith examined, attacked, and as far as argument could go, demolished in his great work. But the dream of a sole market is still possessing the Germans and the French. … The early wars of Europe were wars of conquest. … After them came the wars of religion, from the outbreak of the Insurrection in the Low Countries, and the civil wars in France, down to the Peace of Westphalia in the middle of the 17th century. From that day to our own, European wars have been waged on behalf of the balance of power, the principal mischief-maker in the contest being France. The English, the French, and the Dutch were the competitors in the wars for a sole market. But Holland was practically ruined at the peace of Aix-la-Chapelle, and France was stripped … of her colonies at the peace of Paris, and England became not only the principal maritime, but the principal manufacturing and mercantile country in the world. As regards English trade, however, though India was an outlet to some extent for English goods, its trade was in the hands of a chartered company, whom the Seven Years' War had left in serious straits. The most important sole market which Great Britain had acquired by her wars was the seaboard of North America. To support the finances of the chartered company, the British Parliament determined on taxing the inhabitants of her sole market, and the result as you know was the war of American Independence. … The colonial or sole-market system was based on a strict reciprocity. The English Government admitted colonial produce into the English markets at differential duties, or prohibited the produce of foreign nations and foreign colonies altogether. The Colonies were not only the customers of English manufacturers only, to the absolute exclusion of foreign manufactures, but were prohibited from undertaking those manufactures themselves. The English Government adopted with their colonies the policy which they adopted with Irish manufactures, which they also prohibited, but with this difference, that they disabled the Irish from having any trade whatever with England, with the Colonies, and with foreign countries. They wished to extinguish, with one exception, every Irish product, and to constitute themselves the sole manufacturers and shopkeepers for the Irish. They allowed only the linen manufacture of Ulster. The Irish were to be, with this exception, agriculturists only, but they were to be disabled from selling their agricultural produce in England, or elsewhere. They were practically denied the right of trade. … It was the doctrine of the sole market in its most exaggerated form. … The colonial system, under which advantages were secured to the colonial producer by giving him a preferred market in Great Britain, while the colonist was debarred from engaging in manufactures, was a selfish one on the part of the English merchants and manufacturers. It gave the colonist a sole market, it is true. But it does not follow that a sole market is a high market. On the contrary, it is probable that the offer of a sole market is intended to secure a low market. The Virginian planter sent the whole of his tobacco to England. The English trader re-exported it to other countries, say Holland or Germany. It may be presumed that he made a profit on the original consignment, and on the re-exportation, or he would not have undertaken the business. … The colonial system did not preclude the plantations from sending, under the strict conditions of the Navigation Act, certain kinds of produce to other countries than England. These were called non-enumerated commodities, the principal being corn, timber, salted provisions, fish, sugar, and rum. There was a reason for this, which was to be found in the fiscal system of England. We did not want colonial corn, for there were duties on corn, levied in the interest of the landlords, nor colonial timber, salted meat and salted fish, for the home produce of these articles were similarly assisted. Sugar and rum were allowed to be exported, for the owners of the plantations in the Leeward isles were chiefly absentee English proprietors, who had already a monopoly of English supply, and were powerful enough in Parliament to get an extended market elsewhere. But in 1769, just before the troubles broke out with the American plantations, an Act was passed, disabling the colonists from sending even the non-enumerated commodities to any country north of Cape Finisterre, in Northern Spain. … The enumerated goods, and there was a long list of them, could be exported to Great Britain only. They consisted, as Adam Smith says, of what could not be produced in this country, and what could be produced in great quantity in the Colonies."

_J. E. T. Rogers, The Economic Interpretation of History, lecture 15._

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COMMERCE: MODERN: The Americans: Colonial Trade.