THE FIRST PERIOD OF COMMERCIAL ANTAGONISM, 1783-1795
While the United States had been undergoing the important changes of
the period, 1783-1793, England had passed through an almost equally
significant political transformation, in course of which the two
countries entered upon a long history of difficult and unfriendly
diplomatic relations. The treaty of peace ended the political union of
the two communities, but it left the nature of their commercial
relations to be settled; and this, for the United States, was a problem
second only in importance to that of federal government. If the
prosperity of the thirteen States was to be restored, the old-time
trade routes of the colonial days must be re-established. The West
India market for fish, grain, and lumber, the British or European
market for plantation products must be replaced on a profitable basis,
and the United States must be prepared to purchase these privileges by
whatever concessions lay in its power to grant. It rested chiefly with
England to decide whether to permit the former colonies to resume their
earlier commercial system or begin a new policy, for it was with
Britain and the British colonies {150} that seven-eighths of American
commerce naturally was carried on.
Unfortunately for the people of the United States, and unfortunately
for the harmony of the two countries, the prevailing beliefs of English
merchants, shipowners, naval authorities, and, in general, the official
classes were such as to render a complete resumption of the former
trade relations almost impossible. According to the political and
economic doctrines underlying the Acts of Trade, the moment that the
two countries became separated their interests automatically became
antagonistic. American shipping, formerly fostered when under the
flag, now assumed the aspect of a formidable rival to the British
merchant marine and, as such, ought to be prevented from taking any
profit which by any device could be turned toward British ships.
The treaty of peace had scarcely been signed when there appeared a
pamphlet by Lord Sheffield, early in 1783, which won instant success,
passing through several editions. This announced that henceforward it
was the duty of the British government to discourage and crush American
navigation to the extent of its power in order to check a dangerous
rival, taking especial care to reserve the West Indies for exclusive
British control. At the possibility of losing the {151} profitable
American market through retaliatory measures, Sheffield laughed in
scorn. "We might as reasonably dread the effect of combinations among
the German as among the American States," he sneered, "and deprecate
the resolves of the Diet as those of Congress." There were elements,
of course, to whom these arguments of Sheffield were unwelcome,
particularly the West India planters themselves, and to a degree the
British manufacturers, who would gladly have resumed the trade of the
years before 1776; but, so far as the great majority of Englishmen was
concerned, it seems impossible to doubt that Lord Sheffield was a true
spokesman of their convictions.
In addition to the economic theories of the time, the temper of the
British people was sullen, hostile, and contemptuous toward the former
colonies. The bulk of the nation had come to condemn the policy of the
North Ministry which had led to the loss of the plantations, but they
did not love the Americans any the more for that. The sharp social
distinctions, which prior to 1776 had rendered the nobility, the
gentry, the clergy, and the professions contemptuous toward the
colonists, still reigned unchecked; and the Tories and most of the
ruling classes, regarding the Americans as a set of ungrateful and
spiteful people, whom it was well {152} to have lost as subjects,
ceased to take any interest in their existence. The United States was
dropped, as an unpleasant subject is banished from conversation; and
the relations of the two countries became a matter of national concern
only when the interests of shipowners, merchants, or naval authorities
were sufficiently strong to compel attention from the governing classes.
The Whig leaders should, of course, be excepted from this general
statement, for they and their followers--both their parliamentary
coterie and their middle-class adherents outside--retained a friendly
attitude, and tried to treat the United States with a consideration
which usually had no place in Tory manners. But Whigs as well as
Tories held the prevailing conceptions of naval and economic
necessities, and only scattered individuals, like William Pitt, were
affected by the new doctrines of Adam Smith. Their commercial policy
tended to differ only in degree from that of the more rigid Tories.
To make it certain that the United States should fail to secure
favourable commercial rights, the ascendancy of the Whigs came to a
sudden end within a year from its beginning. The Shelburne Ministry,
which made the peace, had to meet the opposition not only of the Tories
but of the group led by Fox. In the session of 1783, the Whig party
{153} was thus openly split, and presently all England was scandalized
to see Fox enter into a coalition with no less a person than Lord North
for the purpose of obtaining office. Shelburne resigned on February
24, after the passage of a resolution of censure on the Peace; and
George III, after trying every expedient to avoid what he considered a
personal disgrace, was forced, on April 2, to admit Fox and North as
Ministers under the nominal headship of the Duke of Portland. So
Tories were restored to a share in the government, since nearly half of
the coalition majority depended upon Tory votes. In December, 1783,
the King, by a direct exercise of his influence, caused the Lords to
throw out a Ministerial bill for the government of India and,
dismissing the coalition Ministers, he appealed to William Pitt. That
youthful politician, who had first entered office as Chancellor of the
Exchequer under Shelburne, succeeded, after a sharp parliamentary
contest, in breaking down the opposition majority in the House, and in
a general election in March, 1784, won a great victory. Then, at the
head of a mixed Cabinet, supported by Tories and King's Friends as well
as by his own followers from among the Whigs, Pitt maintained himself,
secure in the support of George III, but in no sense his agent or tool.
In the {154} next few years, he made his hold secure by his skill in
parliamentary leadership and his success in carrying financial and
administrative reforms. This was the first peace Ministry since that
of Pelham, 1746-1754, which won prestige through efficient government.
It was, however, mainly Tory in temper, and as such distinctly cold and
unfriendly toward America. Pitt himself was undoubtedly in favour of
liberal commercial relations; but in that respect, as in the question
of parliamentary reform, he followed the opinions of his supporters and
of the nation.
The British policy toward the United States, under the circumstances,
was dictated by a strict adherence to the principles set forth by Lord
Sheffield. Pitt, while Chancellor of the Exchequer under Shelburne,
introduced a very liberal Bill, which, if enacted, would have secured
full commercial reciprocity, including the West India trade. This
failed to pass, however, and was abandoned when Pitt left office in
April, 1783. The Fox-North Ministry followed a different plan by
causing Parliament to pass a Bill authorizing the Crown to regulate the
trade with the West Indies. They then, by proclamation, allowed the
islands to import certain articles from the United States, not
including fish or lumber, and {155} only in British bottoms. It was
hoped that Canada would take the place of the United States in
supplying the West India colonies, and that British vessels would
monopolize the carrying. In 1787 this action was ratified by
Parliament, and the process of discouraging American shipping was
adopted as a national policy. American vessels henceforward came under
the terms of the Navigation Acts, and could take part only in the
direct trade between their own country and England. When John Adams,
in 1785, arrived at London as Minister, and tried to open the subject
of a commercial treaty, he was unable to secure the slightest attention
to the American requests and felt himself to be in an atmosphere of
hostility and social contempt. The British policy proved in a few
years fairly successful. It reduced American shipping trading with
England, it drove American vessels from the British West Indies, and,
owing to the impossibility of the States retaliating separately, it did
not diminish the British market in America. Up to 1789, when the first
Congress of the United States passed a navigation act and adopted
discriminating duties, America remained commercially helpless. The
profit went to British shipowners and merchants.
The American government naturally {156} turned to the other powers
having American possessions, France and Spain, hoping to secure from
them compensating advantages. So far as France was concerned, the
government of Louis XVI was friendly; but its finances were in such
confusion and its administration so unsteady after 1783 that Jefferson,
Minister to France, could secure no important concessions save one. In
1784, as though to step into the place left vacant by the English, the
French crown, by royal order, permitted direct trade between the United
States and the French West Indies in vessels of less than sixty tons
burden. The result was striking. In a few years the American molasses
trade, driven from the British islands, took refuge at San Domingo,
building up a tremendous sugar export and more than filling the place
of the British trade. In 1790 the commerce of San Domingo surpassed
that of all the British Islands together. Here again, French
friendship shone in contrast to English antagonism. Every American
shipowner felt the difference, and remembered it.
With Spain the United States was less successful. Jay, Secretary for
Foreign Affairs, undertook negotiations through Diego Gardoqui, a
Spaniard who, during the Revolution, had furnished many cargoes of
supplies. He {157} found that country sharply dissatisfied over the
boundary assigned to the United States. The British, in ceding Florida
to Spain, had not turned over all of their province of 1763, but had
handed that part of it north of thirty-two degrees to the United
States, and, further, had granted the latter the free navigation of the
Mississippi, through Spanish territory. Gardoqui offered in substance
to make a commercial treaty provided the United States would surrender
the claim to navigate the Mississippi for twenty years. Jay, to whose
mind the interests of the seaboard shipowners and producers far
outweighed the desires of the few settlers of the interior waters, was
willing to make the agreement. But an angry protest went up from the
southern States, whose land claims stretched to the Mississippi, and he
could secure, in 1787, a vote of only seven States to five in Congress.
Since all treaties required the consent of nine States, this vote
killed the negotiations. Spain remained unfriendly, and continued to
intrigue with the Indian tribes in the south-western United States with
a view to retaining their support.
Further north, the United States found itself mortified and helpless
before British antagonism. After 1783 the country had Canada on its
northern border as a small but actively hostile neighbour, for there
{158} thousands of proscribed and ruined Tories had taken refuge. The
governors of Canada, Carlton and Simcoe, as well as the men commanding
the frontier posts, had served against the Americans and regarded them
as rivals. To secure the western fur trade and to retain a hold over
the western Indians was recognized as the correct and necessary policy
for Canada; and the British government, in response to Canadian
suggestions, decided to retain their military posts along the Great
Lakes within the boundaries of the United States. To justify them in
so doing, they pointed with unanswerable truth to the fact that the
United States had not carried out the provisions of the Treaty of 1783
regarding British debts, and that Tories, contrary to the letter and
spirit of that treaty, were still proscribed by law. The State courts
felt in no way bound to enforce the treaty, nor did State legislatures
choose to carry it out. British debts remained uncollectible, and the
British therefore retained their western posts and through them plied a
lucrative trade with the Indians to the south of the Great Lakes.
In the years after the war, a steady flow of settlers entered the Ohio
valley, resuming the movement begun before the Revolution, and took up
land in Kentucky and the Northwest territory. By 1792 Kentucky {159}
was ready to be admitted as a State, and Tennessee and Ohio were
organized as territories. These settlers naturally found the Indians
opposing their advance, and the years 1783-1794 are a chronicle of
smouldering border warfare, broken by intermittent truces. During all
this time it was the firm belief of the frontiersmen that the Indian
hostility was stimulated by the British posts, and hatred of England
and the English grew into an article of faith on their part.
Ultimately, the new government under Washington undertook a decisive
campaign. At first, in 1791, General St. Clair, invading Ohio with raw
troops, was fearfully defeated, with butchery and mutilation of more
than two-thirds of his force; but in 1794 General Wayne, with a more
carefully drilled body, compelled the Indians to retreat. Yet with the
British posts still there, a full control was impossible.
The new constitution, which gave the United States ample powers of
enforcing treaties and making commercial discriminations, did not at
once produce any alteration in the existing unsatisfactory situation.
Spain remained steadily indifferent and unfriendly. France, undergoing
the earlier stages of her own revolution, was incapable of carrying out
any consistent action. The Pitt Ministry, absorbed in the game of
European politics and in internal {160} legislation, sent a Minister,
Hammond, but was content to let its commercial and frontier policies
continue. But when, in 1792, the French Revolution took a graver
character, with the overthrow of the monarchy, and when in 1793 England
joined the European powers in the war against France, while all Europe
watched with horror and panic the progress of the Reign of Terror in
the French Republic, the situation of the United States was suddenly
changed.
In the spring of 1793 there came the news of the war between England
and France, and, following it by a few days only, an emissary from the
French Republic, One and Indivisible, "Citizen Edmond Genet," arrived
at Charleston, South Carolina, April 15. There now exploded a sudden
overwhelming outburst of sympathy and enthusiasm for the French nation
and the French cause. All the remembered help of the days of Yorktown,
all the tradition of British oppression and ravages, all the recent
irritation at the British trade discrimination and Indian policy
coupled with appreciation of French concessions, swept crowds in every
State and every town into a tempest of welcome to Genet. Shipowners
rushed to apply for privateers' commissions, crowds adopted French
democratic jargon and manners. Democratic clubs were formed on the
model of the Jacobin {161} society, and "Civic Feasts," at which Genet
was present, made the country resound. It looked as though the United
States were certain to enter the European war as an ally of France out
of sheer gratitude, democratic sympathy, and hatred for England. The
French Minister, feeling the people behind him, hastened to send out
privateers and acted as though the United States were already in open
alliance.
It now fell to the Washington administration to decide a momentous
question. Regardless of the past, regardless of the British policy
since the peace, was it worth while to allow the country to become
involved in war at this juncture? Decidedly not. Before Genet had
presented his credentials, Washington and Jefferson had framed and
issued a declaration of neutrality forbidding American citizens to
violate the law of nations by giving aid to either side. It was not
merely caution which led to this step. The Federalist leaders and most
of their followers--men of property, standing, and law-abiding
habits--were distinctly shocked at the horrors of the Reign of Terror,
and felt with Burke, their old friend and defender in Revolutionary
days, that such liberty as the French demanded was something altogether
alien to that known in the United States or in England. And as the
{162} news became more and more ghastly, the Federalists grew rapidly
to regard England, with all its unfriendliness, with all its commercial
selfishness, as the saving power of civilization, and France as the
chief enemy on earth of God and man. The result was to precipitate the
United States into a new contest, a struggle on the part of the
Federalist administration, led by Hamilton and Washington, to hold back
the country from being hurled into alliance with France or into war
with England. In this, they had to meet the attack of the already
organizing Republican party, and of many new adherents who flocked to
it during the years of excitement.
The first contest was a short one. Genet, his head turned by his
reception, resented the strict neutrality enforced by the
administration, tried to compel it to recede, endeavoured to secure the
exit of privateersmen in spite of their prohibition, and ultimately in
fury appealed to the people against their government. This conduct
lost him the support of even the most sanguine democrats, and, when the
administration asked for his recall, he fell from his prominence
unregretted. But his successor, Fauchet, a less extreme man, was
warmly welcomed by the opposition leaders, including Madison and
Randolph, Jefferson's {163} successor as Secretary of State, and was
admitted into the inmost councils of the party.
Hardly was Genet disposed of when a more dangerous crisis arose, caused
by the naval policy of England. When war broke out, the British
cruisers, as was their custom, fell upon French commerce, and
especially upon such neutral commerce as could, under the then
announced principles of international law, be held liable to capture.
Consequently, American vessels, plying their lucrative trade with the
French West Indies, were seized and condemned by British West India
prize courts. It was a British dogma, known as the Rule of 1756, that
if trade by a neutral with enemies' colonies had been prohibited in
peace, it became contraband in time of war, otherwise belligerents, by
simply opening their ports, could employ neutrals to do their trading
for them. In this case, the trade between the French West Indies and
America had not been prohibited in peace, but the seizures were made
none the less, causing a roar of indignation from the entire American
seacoast. Late in 1793, the British Ministry added fresh fuel to the
fire by declaring provisions taken to French territory to be contraband
of war. If an intention to force the United States into alliance with
France had been guiding the {164} Pitt Ministry, no better steps could
have been devised to accomplish the end. As a matter of fact, the Pitt
Ministry thought very little about it in the press of the tremendous
European cataclysm.
When Congress met in December, 1793, the old questions of Hamilton's
measures and the "monarchism" of the administration were forgotten in
the new crisis. Apparently a large majority in the House, led by
Madison, were ready to sequester British debts, declare an embargo,
build a navy, and in general prepare for a bitter contest; but by great
exertions the administration managed to stave off these drastic steps
by promising to send a special diplomatic mission to prevent war.
During the summer the excitement grew, for it was in this year that
Wayne's campaign against the western Indians took place, which was
generally believed to be rendered necessary by the British retention of
the posts; and also in this same summer the inhabitants of western
Pennsylvania broke into insurrection against the hated excise tax.
This lawlessness was attributed by the Federalists, including
Washington himself, to the demoralizing influence of the French
Revolution, and was therefore suppressed by no less than 15,000
militia, an action denounced by the Republicans--as Randolph confided
to the French Minister--as an example of {165} despotic brutality. Men
were fast coming to be incapable of cool thought on party questions.
The special mission to England was undertaken by the Chief Justice,
Jay, the most experienced diplomat in America since the death of
Franklin. Upon arriving in England, he found the country wild with
excitement and horror over the French Revolution, and with all its
interest concentrated upon the effort to carry on war by land and sea.
The Pitt Ministry was now supported by all Tories, representing the
land-holding classes, the clergy, and the professions, and by nearly
all the aristocratic Whigs. Burke, one-time defender of the American
Revolution, was exhausting his energies in eloquent and extravagant
denunciations of the French. Only a handful of radicals, led by Fox,
Sheridan, and Camden, and representing a few constituents, still dared
to proclaim liberal principles. In all other classes of society,
democracy was regarded as synonymous with bestial anarchy and
infidelity. Clearly the United States, from its very nature as a
republic, could hope for no favour, in spite of the noticeably English
prepossessions of Hamilton's party.
Jay dealt directly and informally with William Grenville, the Secretary
for Foreign Affairs, and seems rapidly to have come to {166} the
conclusion that it was for the interest of the United States to get
whatever it could, rather than to endeavour to haggle over details with
an immovable and indifferent Ministry, thereby hazarding all success.
On his part, Grenville clearly did his best to establish a practicable
working arrangement, agreeing with Jay in so framing the treaty as to
waive "principles" and "claims" and to include precise provisions. The
up-shot was that when Jay finished his negotiations he had secured a
treaty which for the first time established a definite basis for
commercial dealings and removed most of the dangerous outstanding
difficulties. British debts were to be adjusted by a mixed commission,
and American claims for unjust seizures in the West Indies were to be
dealt with in similar fashion. The British were to evacuate the
north-western military posts, and, while they did not withdraw or
modify the so-called "rule of 1756," they agreed to a clear definition
of contraband of war. They were also ready to admit American vessels
of less than seventy tons to the British West Indies, provided the
United States agreed not to export West India products for ten years.
Here Jay, as in his dealings with Gardoqui, showed a willingness to
make a considerable sacrifice in order to gain a definite small point.
On the whole, the treaty {167} comprised all that the Pitt Ministry,
engaged in a desperate war with the French Republic, was likely to
concede.
The treaty left England in the winter of 1795 and reached America after
the adjournment of Congress. Although it fell far short of what was
hoped for, it still seemed to Washington wholly advisable to accept it
under the circumstances as an alternative to further wrangling and
probable war. Sent under seal of secrecy to the Senate, in special
session, its contents were none the less revealed by an opposition
senator, and a tempest of disappointment and anger swept the country.
In every seaport Jay was execrated as a fool and traitor and burned in
effigy. Washington watched unmoved. The Senate voted ratification by
a bare two-thirds, but struck out the West India article, preferring to
retain the power of re-exporting French West India produce rather than
to acquire the direct trade with the English islands. Washington added
his signature, the British government accepted the amendment, and the
treaty came into effect. The West India privilege was, in fact,
granted by the Pitt Ministry, as in the treaty, owing to the demands of
the West India planters. In America the storm blew itself out in a few
weeks of noise and anger, and the country settled down to make the best
of the privileges {168} gained, which, however incomplete, were well
worth the effort.
So the Federalist administration kept the United States neutral, and
gave it at last a definite commercial status with England. It did
more, for in August, 1795, the north-western Indians, beaten in battle
and deprived of the presence of their protectors, made a treaty
abandoning all claims to the region south of Lake Erie. The Spanish
government, on hearing of the Jay treaty, came to terms in October,
1795, agreeing to the boundaries of 1783, granting a "right of deposit"
to American trades down the Mississippi at or near New Orleans, and
promising to abandon Indian intrigues. The diplomatic campaign of the
Federalists seemed to be crowned with general success.
But in the process the passions of the American people had become
deeply stirred, and by the end of 1795 the Federalist party could no
longer, as at the outset, count on the support of all the mercantile
elements and all the townspeople, for, by their policy toward France
and England, Washington, Hamilton, and their associates had set
themselves against the underlying prejudices and beliefs of the voters.
The years of the strong government reaction were at an end. The time
had come to fight for party existence.
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