WARS, POLITICS, AND INDUSTRY
§ 1. ENGLAND’S INDUSTRIAL ADVANTAGES IN 1763--If we look at the state
of the European powers after the conclusion of the Seven Years’ War by
the Treaty of Paris in 1763, we shall see that England had achieved a
very favourable position for the growth of her internal industries. It
is true that along with the rest of Europe she had adopted the policy
of endeavouring to secure a sole market for her goods, and though that
policy was a ruinous mistake she was not alone in her error, and since
other powers were doing the same, it was just as well that she should
hold the lead among them. And, as Professor Rogers has remarked, since
we are paying interest upon the heavy national bills which we ran up at
that time, we may profitably examine what we gained thereby.
In the first place, England had seriously crippled her powerful
commercial rival, France, both in her Indian and American possessions.
By the Seven Years’ War we had gained Canada, Florida, and all the
French possessions east of the Mississippi River (except New Orleans);
while in India our influence had become supreme, owing to the victories
of Clive. French influence in India and America was practically
annihilated. Spain, the faithful ally of France, lost with her friend
her place as the commercial rival of England in foreign trade. Germany
was {168} again being ravaged by the dynastic struggles in which
Frederick the Great bore so prominent a part, between the reigning
houses of Austria and Prussia. Holland was similarly torn by internal
dissensions under the Stadtholder William V., which gave the rival
sovereigns of Prussia and Austria a chance of making matters worse by
their interference. By 1790 the United Provinces had thus sunk into
utter insignificance. Sweden, Norway, and Italy were of no account in
European politics, and Russia had only begun to come to the front.
Hence England alone had the chance of “the universal empire of a
sole market.” The supply of this market, especially in our American
colonies, was in the hands of English manufacturers and English
workmen. The great inventions which came, as we saw, after 1763 were
thus at once called into active employment, and our mills and mines
were able to produce wealth as fast as they could work without fear of
foreign competition.
§ 2. THE MISTAKE OF THE MERCANTILE THEORY--But unfortunately our
capitalists made a great mistake in their policy. The commercial mind
of England was dominated by what is known as the “Mercantile Theory.”
It was a theory that had grown up naturally out of the spirit of
Nationalism, of self-sustained and complete national life, that was
our heritage from the Renaissance and the Reformation. It was not
altogether wrong, for its object was national greatness, an object
laudable and harmless enough. But the believers in the policy of
increasing our national greatness also believed that it could only be
attained in one way, and that was at the expense of our neighbours.
In one form and another the theory frequently crops up even to-day,
though we are supposed to have repudiated it. The measures adopted
to attain this end were various and not always unsuccessful. True,
{169} our commercial forefathers made the mistake--not uncommon even
now--of believing that national wealth consisted chiefly in holding
large stores of gold and silver, and hence they prohibited the export
of bullion, till the East India Company demonstrated the futility of
this scheme.[48] They endeavoured, too, to obtain a supply of the
precious metals by prohibiting the purchase of foreign manufactures,
and encouraging only the imports of raw material, that we might sell
our own manufactures for foreign silver and gold. Hence proceeded wars
of tariff, as for instance when we prohibited the import of gold-lace
from Flanders, and the Flemish in revenge excluded our exports of wool.
But the most famous of the restrictions imposed by this theory were
the Navigation Acts of 1651, by which it was ordered that no goods
from Asia, Africa, or America were to be imported into England or her
colonies, except in ships belonging to English subjects, and no goods
of any European country were to be imported except in English vessels,
or ships belonging to the country from which the goods came. Of course
these Acts resulted in collision with Dutch interests, for the Dutch
were at that time the ocean carriers of the world. We were driven out
of neutral ports, and lost the Russian and Baltic trade, because of the
high charges of English ship-owners, to whom this protective scheme
gave a monopoly of freights. But at the same time our shipping trade
gained a great stimulus, and our commercial supremacy grew with it.
Of course, however, this protective measure made the country at large
pay a higher price for this privilege than was necessary, and we could
probably have done better without it. Nevertheless these Acts, coupled
with the development of our Indian and American trade, resulted in
giving us a position of undoubted {170} commercial supremacy. Many
other Protective measures, of a worse kind than this, were passed owing
to the dictates of this theory, as for instance when in 1750 Parliament
forbade the importation of pig and bar iron from our American colonies.
But the Nemesis of this Protective policy was sure to come, and come
it did in that fatal folly which caused us to lose those very colonies
which we had defended against the French in the Seven Years’ War.
[48. See note 15, p. 249, on this point.]
§ 3. THE LOSS OF THE AMERICAN COLONIES--The way in which English
statesmen looked upon our colonies in the last century was that they
owed everything to England, and that therefore it was only fair that
they should be exploited in the interests of the mother-country.
Thus all imports to our colonies from any other country of Europe
except England were forbidden, in order that our manufacturers might
monopolize the American market. The criminal folly of our legislators
went even further than this, for every attempt was made to discourage
the colonists from starting manufactures at home. The American woollen
industry was practically suppressed; all iron manufactures, as just
mentioned, were forbidden in 1750; even colonial hatters were not
allowed to send hats from one colony into another.
Nevertheless the American colonists evaded the regulations that forbade
them to trade with any but the mother-country, and did, for instance,
a considerable trade with South America. But in George III.’s reign,
Grenville, a Whig minister, was foolish enough to try and stop this.
Moreover, he sought to raise money wherewith to pay for the American
portion of the Seven Years’ War by taxing the colonists upon the stamps
on legal papers (Stamp Act, 1765). The idea that the colonists should
pay part of the expenses of the war undertaken in their defence was
just enough; but that these expenses should be defrayed by a {171}
system of taxation in which they had no voice was exactly the reverse.
It is to the credit of Pitt that he protested against this taxation
without representation, and exerted his influence for the repeal of
this Act (1766). Thus the feelings of the colonists were soothed for
a time, and in 1770 Lord North took off all taxes except that on tea.
The colonists refused to buy tea: the East India Company, whose trade
naturally suffered, tried to force their tea into America, and matters
culminated in the celebrated emptying of a shipload of it into Boston
harbour by the citizens of that port (1773). North tried to punish
the Bostonians by decreeing that their port should be closed, and
that the charter of Massachusetts, their colony, should be annulled.
Of course war was now imminent. We need not here go into the details
of that unfortunate conflict, though we must mention the heroic
endeavours of Pitt, now Lord Chatham, to make England give full redress
to her offspring. His efforts were in vain. France eagerly took the
opportunity of assisting the Americans against the English, and England
had to pay very dearly for her adherence to the Mercantile Theory.
§ 4. THE OUTBREAK OF THE GREAT CONTINENTAL WAR--But although the War
of Independence cost us a great deal, it did not greatly affect the
development of our home industries. The Industrial Revolution went
steadily on, and for just thirty years (1763–93) the country, though
not entirely at peace, was yet sufficiently undisturbed to make rapid
progress in the new manufacturing methods. But in 1789 the French
Revolution broke out, and for over twenty years Europe was plunged into
a disastrous and exhausting conflict. At the first outbreak of the
Revolution, England looked on quietly. Many men were openly glad that
the downtrodden masses of the French nation had overthrown the tyranny
of an upper class whose only {172} idea of their duty in life was to
extort the last farthing from those below them, in order to spend it
in irresponsible debauchery. Statesmen like Fox gloried in it; the
younger Pitt was anxious not to interfere. But Pitt was forced into
action by the capitalists, who now were equal with the land-owners as
the two ruling powers of England. He saw that the conquests which the
new French Republic was already beginning to make might help France to
secure again her old position as the most formidable rival of English
commerce. If now this rival could be finally struck down, England was
sure of the control of the world’s markets. It was obviously the policy
of England to check the power of France, and when war was declared by
the young Republic, England was not slow to answer the challenge. After
this England was plunged headlong into the great European struggle of
Monarchy against Republicanism. Pitt gained the support of all classes
at home. The merchants and manufacturers were only too glad to see
their old rival ruined; the land-owners and nobility were of course
indignant at seeing the “lower classes,” even of a foreign nation, rise
against their lords, even though their lords perhaps deserved their
punishment. It was generally believed, and it was largely true, that
England was fighting for the great principles of Monarchy and Religion,
exemplified by a foolish king and a corrupted priesthood. For a time
everyone supported Pitt’s policy. But the French Revolution had found
many sympathizers among the working classes, and after the country had
felt the first severity of the burdens imposed by the war, a spirit of
discontent manifested itself. But the nation at large was against this
opposition, and drastic measures were taken to silence it. Pitt was
indomitable till his death (in 1805), and under his guidance England
often fought single-handed against the world. {173} At times, as in
1796, she was threatened with invasion by the French, and the Irish, or
a certain section of them, assisted her would-be invaders. At another
time (1806), English industry was threatened with ruin by Napoleon’s
Berlin Decree, forbidding Continental nations to trade with us.[49] But
at last the great inspiring genius of England’s enemies was defeated,
and the long years of war came to a close in 1815.
[49. See my _Commerce in Europe_, p. 177.]
§ 5. ITS EFFECTS UPON INDUSTRY, AND THE WORKING CLASSES--When peace
came at length, it found the resources of the nation sorely tried, but
not yet exhausted. All classes had suffered somewhat, but the working
classes worst of all. The French Revolution, and the consequent wars,
had retarded to some extent the development of our industries, for it
took nearly all the wealth produced by the new industrial system to
pay for them. But in one thing we possessed a great advantage over
Continental nations, for our island was the only country in which war
was not actually going on, and hence our manufactures were undisturbed.
Consequently England was by no means so exhausted as the other
participants in the struggle, and she had, moreover, the ocean-carrying
trade left secure to her by our undisputed naval supremacy. But yet
her finances had been tried and stretched to an enormous extent. The
total cost of the war with France had been £831,446,449, to meet which
Pitt was compelled to turn to almost every expedient that his financial
ingenuity could suggest. Taxation became more and more heavy, and
£600,000,000 was added to the debt which we have since been engaged
in paying off. The currency had been placed in the most abnormal
condition; cash payments were (in 1797) suspended by the Bank of
England; and it became a necessity, as soon as {174} the war was over,
to put an end to the circulation of a practically inconvertible paper
currency by the resumption of them in 1819.
But the working classes had suffered the most, in spite of the fact
that our manufactures prospered and exports increased all through the
war. In 1793 the exports were officially valued at over £17,000,000;
for every year afterwards they were at least £22,000,000, often more;
in 1800 over £34,000,000, and in 1815 had quite doubled their value
at the beginning of the war, being then over £58,000,000 (official
value). But the profits all went into the hands of the capitalist
manufacturers, while taxation fell with special severity upon the
poor, since taxes were placed on every necessity and convenience of
daily life. Even as late as 1841 there were 1200 articles in the
customs tariff. The price of wheat, moreover, rose to famine height;
from 49_s._ 3_d._ per quarter in 1793, to 69_s._ in 1799, to 113_s._
in 1800, and 106_s._ in 1810. At the same time wages were rapidly
falling,[50] and thus the chief burdens of the war fell upon those
least able to pay for them. But the poverty of the poor was the wealth
of the land-owners, who kept on raising rents continually and grew rich
upon the starvation of the people; for they persuaded Parliament to
prohibit the importation of foreign corn except at famine prices (cf.
p. 200), and shifted the burden of taxation, as was not unnatural,
upon other shoulders. It was owing to their influence that Pitt raised
fresh funds from taxes on articles of trade, manufacture and general
consumption. The result was seen in the deepening distress of the
industrial classes, and in 1816 riots broke out everywhere--in Kent
among the agricultural labourers, in the Midlands among the miners, and
at {175} Nottingham among the artisans, who wreaked their vengeance
upon the new machines which they thought had stolen their bread. They
should have blamed those who did not allow them to participate in the
wealth they had helped to create.
[50. For further details as to condition of the working
classes, see p. 194.]
§ 6. POLITICS AMONG THE WORKING CLASSES--Such were the economic effects
of the war upon English society--the enriching of the capitalists and
land-owners at the expense of the working classes. So dire was the
distress of the workmen that they felt something must be done to make
their voice effectively heard in the government of the people. William
Cobbett, in his _Weekly Political Register_, taught them to believe
that a reform of Parliament would cure their evils. The influences of
the French Revolution and the Industrial Revolution also combined to
arouse an active political feeling amongst them; for the former excited
a sympathetic feeling of revolt against unjust oppression, from what
source soever it might come, and the latter brought home to them in
their daily lives the new and sharp distinctions between the capitalist
autocrat and his hundreds of workpeople bound to him only by a cash
nexus, and as yet powerless to resist his endeavours to keep down their
wages. Indistinctly, but none the less keenly, the working classes
began to feel that they too must be consulted in the councils of the
nation, and as a preliminary step must gain an influence over political
events. But their early endeavours were sharply and severely repressed,
and the legislation following on the (so-called) Manchester Massacre
of 1819, crushed them for a time. But the Great War had roused the
political feelings of the masses, by the misery it had inflicted upon
them and by the industrial conditions which it had brought more fully
into play. For although at first it retarded them, it gave a direct
stimulus to the new {176} manufactures and to the new manufacturing
system, by leaving England the only nation not too exhausted to
continue her commerce. During its progress England had definitely
become the workshop of the world, her industry had definitely completed
its transition from the domestic to the factory system. Of this system,
with its enormous advantages but also enormous evils, we must now speak.