Part 33

Through Spain and Portugal and Holland and England, precious metals began to find their way to Europe The sixteenth century had its own writers on the subject of political economy and they evolved a theory of national wealth which seemed to them entirely sound and of the greatest possible benefit to their respective countries. They reasoned that both gold and silver were actual wealth. Therefore they believed that the country with the largest supply of actual cash in the vaults of its treasury and its banks was at the same time the richest country. And since money meant armies, it followed that the richest country was also the most powerful and could rule the rest of the world.

We call this system the "mercantile system," and it was accepted with the same unquestioning faith with which the early Christians believed in Miracles and many of the present-day American business men believe in the Tariff. In practice, the Mercantile system worked out as follows: To get the largest surplus of precious metals a country must have a favourable balance of export trade. If you can export more to your neighbour than he exports to your own country, he will owe you money and will be obliged to send you some of his gold. Hence you gain and he loses. As a result of this creed, the economic program of almost every seventeenth century state was as follows:

1. Try to get possession of as many precious metals as you can.

2. Encourage foreign trade in preference to domestic trade.

3. Encourage those industries which change raw materials into exportable finished products.

4. Encourage a large population, for you will need workmen for your factories and an agricultural community does not raise enough workmen.

5. Let the State watch this process and interfere whenever it is necessary to do so.

Instead of regarding International Trade as something akin to a force of nature which would always obey certain natural laws regardless of man's interference, the people of the sixteenth and seventeenth centuries tried to regulate their commerce by the help of official decrees and royal laws and financial help on the part of the government.

In the sixteenth century Charles V adopted this Mercantile System (which was then something entirely new) and introduced it into his many possessions. Elizabeth of England flattered him by her imitation. The Bourbons, especially King Louis XIV, were fanatical adherents of this doctrine and Colbert, his great minister of finance, became the prophet of Mercantilism to whom all Europe looked for guidance.

The entire foreign policy of Cromwell was a practical application of the Mercantile System. It was invariably directed against the rich rival Republic of Holland. For the Dutch shippers, as the common-carriers of the merchandise of Europe, had certain leanings towards free-trade and therefore had to be destroyed at all cost.

It will be easily understood how such a system must affect the colonies. A colony under the Mercantile System became merely a reservoir of gold and silver and spices, which was to be tapped for the benefit of the home country. The Asiatic, American and African supply of precious metals and the raw materials of these tropical countries became a monopoly of the state which happened to own that particular colony. No outsider was ever allowed within the precincts and no native was permitted to trade with a merchant whose ship flew a foreign flag.

Undoubtedly the Mercantile System encouraged the development of young industries in certain countries where there never had been any manufacturing before. It built roads and dug canals and made for better means of transportation. It demanded greater skill among the workmen and gave the merchant a better social position, while it weakened the power of the landed aristocracy.

On the other hand, it caused very great misery. It made the natives in the colonies the victims of a most shameless exploitation. It exposed the citizens of the home country to an even more terrible fate. It helped in a great measure to turn every land into an armed camp and divided the world into little bits of territory, each working for its own direct benefit, while striving at all times to destroy the power of its neighbours and get hold of their treasures. It laid so much stress upon the importance of owning wealth that "being rich" came to be regarded as the sole virtue of the average citizen. Economic systems come and go like the fashions in surgery and in the clothes of women, and during the nineteenth century the Mercantile System was discarded in favor of a system of free and open competition. At least, so I have been told.

THE AMERICAN REVOLUTION

AT THE END OF THE EIGHTEENTH CENTURY EUROPE HEARD STRANGE REPORTS OF SOMETHING WHICH HAD HAPPENED IN THE WILDERNESS; OF THE NORTH AMERICAN CONTINENT. THE DESCENDANTS OF THE MEN WHO HAD PUNISHED KING CHARLES FOR HIS INSISTENCE UPON HIS "DIVINE RIGHTS" ADDED A NEW CHAPTER TO THE OLD STORY OF THE STRUGGLE FOR SELF-GOVERNMENT

FOR the sake of convenience, we ought to go back a few centuries and repeat the early history of the great struggle for colonial possessions.

As soon as a number of European nations had been created upon the new basis of national or dynastic interests, that is to say, during and immediately after the Thirty Years War, their rulers, backed up by the capital of their merchants and the ships of their trading companies, continued the fight for more territory in Asia, Africa and America.

The Spaniards and the Portuguese had been exploring the Indian Sea and the Pacific Ocean for more than a century ere Holland and England appeared upon the stage. This proved an advantage to the latter. The first rough work had already been done. What is more, the earliest navigators had so often made themselves unpopular with the Asiatic and American and African natives that both the English and the Dutch were welcomed as friends and deliverers. We cannot claim any superior virtues for either of these two races. But they were merchants before everything else. They never allowed religious considerations to interfere with their practical common sense. During their first relations with weaker races, all European nations have behaved with shocking brutality. The English and the Dutch, however, knew better where to draw the dine. Provided they got their spices and their gold and silver and their taxes, they were willing to let the native live as it best pleased him.

It was not very difficult for them therefore to establish themselves in the richest parts of the world. But as soon as this had been accomplished, they began to fight each other for still further possessions. Strangely enough, the colonial wars were never settled in the colonies themselves. They were decided three thousand miles away by the navies of the contending countries. It is one of the most interesting principles of ancient and modern warfare (one of the few reliable laws of history) that "the nation which commands the sea is also the nation which commands the land." So far this law has never failed to work, but the modern airplane may have changed it. In the eighteenth century, however, there were no flying machines and it was the British navy which gained for England her vast American and Indian and African colonies.

The series of naval wars between England and Holland in the seventeenth century does not interest us here. It ended as all such encounters between hopelessly ill-matched powers will end. But the warfare between England and France (her other rival) is of greater importance to us, for while the superior British fleet in the end defeated the French navy, a great deal of the preliminary fighting was done on our own American continent. In this vast country, both France and England claimed everything which had been discovered and a lot more which the eye of no white man had ever seen. In 1497 Cabot had landed in the northern part of America and twenty-seven years later, Giovanni Verrazano had visited these coasts. Cabot had flown the English flag. Verrazano had sailed under the French flag. Hence both England and France proclaimed themselves the owners of the entire continent.

During the seventeenth century, some ten small English colonies had been founded between Maine and the Carolinas. They were usually a haven of refuge for some particular sect of English dissenters, such as the Puritans, who in the year 1620 went to New England, or the Quakers, who settled in Pennsylvania in 1681. They were small frontier communities, nestling close to the shores of the ocean, where people had gathered to make a new home and begin life among happier surroundings, far away from royal supervision and interference.

The French colonies, on the other hand, always remained a possession of the crown. No Huguenots or Protestants were allowed in these colonies for fear that they might contaminate the Indians with their dangerous Protestant doctrines and would perhaps interfere with the missionary work of the Jesuit fathers. The English colonies, therefore, had been founded upon a much healthier basis than their French neighbours and rivals. They were an expression of the commercial energy of the English middle classes, while the French settlements were inhabited by people who had crossed the ocean as servants of the king and who expected to return to Paris at the first possible chance.

Politically, however, the position of the English colonies was far from satisfactory. The French had discovered the mouth of the Saint Lawrence in the sixteenth century. From the region of the Great Lakes they had worked their way southward, had descended the Mississippi and had built several fortifications along the Gulf of Mexico. After a century of exploration, a line of sixty French forts cut off the English settlements along the Atlantic seaboard from the interior.

The English land grants, made to the different colonial companies had given them "all land from sea to sea." This sounded well on paper, but in practice, British territory ended where the line of French fortifications began. To break through this barrier was possible but it took both men and money and caused a series of horrible border wars in which both sides murdered their white neighbours, with the help of the Indian tribes.

As long as the Stuarts had ruled England there had been no danger of war with France. The Stuarts needed the Bourbons in their attempt to establish an autocratic form of government and to break the power of Parliament. But in 1689 the last of the Stuarts had disappeared from British soil and Dutch William, the great enemy of Louis XIV succeeded him. From that time on, until the Treaty of Paris of 1763, France and England fought for the possession of India and North America.

During these wars, as I have said before, the English navies invariably beat the French. Cut off from her colonies, France lost most of her possessions, and when peace was declared, the entire North American continent had fallen into British hands and the great work of exploration of Cartier, Champlain, La Salle, Marquette and a score of others was lost to France.

Only a very small part of this vast domain was inhabited. From Massachusetts in the north, where the Pilgrims (a sect of Puritans who were very intolerant and who therefore had found no happiness either in Anglican England or Calvinist Holland) had landed in the year 1620, to the Carolinas and Virginia (the tobacco-raising provinces which had been founded entirely for the sake of profit), stretched a thin line of sparsely populated territory. But the men who lived in this new land of fresh air and high skies were very different from their brethren of the mother country. In the wilderness they had learned independence and self-reliance. They were the sons of hardy and energetic ancestors. Lazy and timourous people did not cross the ocean in those days. The American colonists hated the restraint and the lack of breathing space which had made their lives in the old country so very unhappy. They meant to be their own masters. This the ruling classes of England did not seem to understand. The government annoyed the colonists and the colonists, who hated to be bothered in this way, began to annoy the British government.

Bad feeling caused more bad feeling. It is not necessary to repeat here in detail what actually happened and what might have been avoided if the British king had been more intelligent than George III or less given to drowsiness and indifference than his minister, Lord North. The British colonists, when they understood that peaceful arguments would not settle the difficulties, took to arms. From being loyal subjects, they turned rebels, who exposed themselves to the punishment of death when they were captured by the German soldiers, whom George hired to do his fighting after the pleasant custom of that day, when Teutonic princes sold whole regiments to the highest bidder.