The Law of Civilization and Decay

Meanwhile, however, that no time might be lost while fighting for the mines themselves, Cromwell sent Blake to intercept the treasure ships off the coast of Spain. At first Blake also had ill-luck. In 1655 the plate fleet escaped him, but the next year, though forced himself to go to port for supplies, he detached Captain Stayner, with six sail, to cruise off Cadiz, and on September 19, General Montague was able to report that his “hart [was] very much warmed with the apprehension of the singular providence of God,” who had permitted Stayner to meet, “with the Kinge of Spain’s West India fleete,” and take among other prizes “a gallion reported to have in her two million pieces of plate.”325 If the “plate” were Mexican “pieces of eight” at four shillings and sixpence, the cargo was worth £450,000, or considerably more than the whole annual export to the East at the beginning of the eighteenth century. Had the Protector lived, there can be little doubt that, by some such means as this, he would have fostered British resources, and maintained the integrity of British coin; but in less than two years from the date of Montague’s dispatch, Cromwell was dead, and the inertia of the Tory landlords paralyzed the nation for another generation. No foreigner was robbed, and the stock of domestic silver dwindled from year to year, until at the Revolution the golden guinea, which, from its first issue in 1662 down to the accession of William and Mary, had been nominally current for twenty shillings, actually sold in the market for thirty shillings of the money in use.

“This diminishing and counterfeiting the money was at this time so excessive, that what was good silver was worth scarcely one-half of its current value, whilst a great part of the coins was only iron, brass, or copper plated, and some no more than washed over.”326

One of the first acts of the new government was a complete recoinage, which was finished in 1699; but the measure failed of its purpose, for the reason that the exports of silver regularly exceeded the imports.

In 1717, a committee of the House of Lords considered the condition of the currency, and Lord Stanhope then explained very lucidly the cause of the scarcity of silver. Among other papers he produced a report from the Custom House, by which it appeared that, in the year 1717, “the East India Company had exported near three million ounces of silver, which far exceeding the imports of the bullion in that year, it necessarily followed that vast quantities of silver specie must have been melted down, both to make up the export, and to supply the silversmith.”327 For the decade from 1711 to 1720 the annual export of bullion by the East India Company averaged £434,000.328 At the accession of George III., in 1760, Lord Liverpool estimated that shillings had lost one-sixth, and sixpences one-quarter of their original weight, while the crown-piece had almost wholly disappeared.329 Even Adam Smith admitted that because of this outflow silver had risen in value, and probably purchased “a larger quantity both of labour and commodities” than it otherwise would.330

In this emergency the British merchants showed the resource which has always been their characteristic, and, in default of an adequate supply of specie, relieved the strain upon their currency by issuing paper. Mediæval banking had gone no further than the establishment of reserves of coin, to serve as a medium for clearing bills of exchange; the English took the great step of accelerating the circulation of their money, by using this reserve as a basis for a paper currency which might be largely expanded. The Bank of England was incorporated in 1694, the Bank of Scotland in 1695, and the effect was unquestionably considerable. Adam Smith has thus described the impetus received by Glasgow: —

“The effects of it have been precisely those above described. The business of the country is almost entirely carried on by means of the paper of those different banking companies, with which purchases and payments of all kinds are commonly made. Silver very seldom appears except in the change of a twenty shillings bank note, and gold still seldomer. But though the conduct of all those different companies has not been unexceptionable … the country, notwithstanding, has evidently derived great benefit from their trade. I have heard it asserted, that the trade of the city of Glasgow doubled in about fifteen years after the first erection of the banks there; and that the trade of Scotland has more than quadrupled since the first erection of the two public banks at Edinburgh.”331

But although by this means a certain degree of relief was given, and though prices rose slowly throughout the first half of the eighteenth century, the fundamental difficulty remained. There was insufficient silver for export, exchanges were adverse, and that stock of coined money was lacking which is the form in which force clothes itself in highly centralized communities. How England finally supplied her needs is one of the most dramatic pages of history.

As Jevons has aptly observed, Asia is “the great reservoir and sink of the precious metals.” From time immemorial the Oriental custom has been to hoard, and from the Mogul blazing with the diamonds of Golconda, to the peasant starving on his wretched pittance, every Hindoo had, in former days, a treasure stored away against a day of trouble. Year by year, since Pizarro had murdered the Inca Atahualpa for his gold, a stream of bullion had flowed from America to Europe, and from Europe to the East: there it had vanished as completely as though once more buried in the bowels of the mine. These hoards, the savings of millions of human beings for centuries, the English seized and took to London, as the Romans had taken the spoil of Greece and Pontus to Italy. What the value of the treasure was, no man can estimate, but it must have been many millions of pounds – a vast sum in proportion to the stock of the precious metals then owned by Europeans. Some faint idea of the booty of the conqueror may be drawn from Macaulay’s description of the first visit of an English soldier to an Oriental treasure chamber: —

“As to Clive, there was no limit to his acquisitions but his own moderation. The treasury of Bengal was thrown open to him. There were piled up, after the usage of Indian princes, immense masses of coin, among which might not seldom be detected the florins and byzants with which, before any European ship had turned the Cape of Good Hope, the Venetians purchased the stuffs and spices of the East. Clive walked between heaps of gold and silver, crowned with rubies and diamonds, and was at liberty to help himself.”332

The lives of few men are better known than those of Clive and Hastings, and yet there are few whose influence upon the fate of mankind has had such scant appreciation. It is not too much to say that the destiny of Europe hinged upon the conquest of Bengal. Robert Clive was of the same stock as Drake and Hawkins, Raleigh, Blake, and Cromwell; he was the eldest son of one of those small farmers whose ancestors had held their land ever since the Conquest, and who, when at last evicted and driven out to sea, had fought and conquered on every continent and on every ocean. Among the throng of great English adventurers none is greater than he.

He was born in 1725, and from childhood displayed those qualities which made him pre-eminent on the field of battle; fighting was his delight, and so fierce was his temper that his family could not control him. At last, when eighteen, his father gladly sent him to Madras as a clerk in the service of the East India Company; and there, in a torrid climate which shattered his health, poor and neglected, lonely and forlorn, he pined, until in melancholy he twice attempted suicide. But he was destined to found an empire, and at last his hour came.

When Clive went to India, the Company was still a purely commercial concern, holding only the land needed for its warehouses, and having in their pay a few ill-disciplined sepoys. In the year 1746, when Clive was twenty-one, the war of the Austrian Succession was raging, and suddenly a French fleet, commanded by Labourdonnais, appeared off Madras, and attacked Fort Saint George. Resistance was hopeless, the place surrendered, and the governor and chief inhabitants were taken to Pondicherry. Clive, however, managed to escape, and, volunteering, received an ensign’s commission, and began his military career.

Shortly after, peace was made in Europe, but in India the issue of the struggle lay undecided between the French and English, the prize being the peninsula. Dupleix, the French governor of Pondicherry, was a man of commanding intellect, who first saw the possibility of constructing a European empire in Hindostan by controlling native princes. Following up his idea, he mixed in a war of succession, and having succeeded in establishing a sovereign of the Deccan, he made himself master of Southern India. The Nizam’s treasure was thrown open to him, and beside many jewels of price, he is said to have appropriated two hundred thousand pounds in coin. This was the man whom Clive, when only a clerk of twenty-five, without military education or experience, attacked and overthrew.

Clive began his campaigns by the capture and defence of Arcot, one of the most daring deeds of a generation given over to perpetual war. Aided by their native allies, the French had laid siege to Trichinopoly, and Clive represented to his superiors that with the fate of Trichinopoly was bound up the fate of the whole peninsula. He recommended making a diversion by assaulting Arcot, the capital of the Carnatic; his plan met with approval, and, with two hundred Europeans and three hundred sepoys, he marched to fight the greatest power in the East. He succeeded in surprising and occupying the town without loss, but when within the city his real peril began. Arcot had neither ditches nor defensible ramparts, the English were short of provisions, and the Nabob hurried forward ten thousand men to relieve his capital. With four officers, one hundred and twenty British, and two hundred sepoys, Clive held the town for fifty days, and when the enemy assaulted for the last time he served his own guns. He won a decisive victory, and from that hour was recognized as among the most brilliant officers of the world.

Other campaigns followed, but his health, undermined by the tropics, gave way, and at twenty-seven he returned home to squander his money and contest an election to Parliament. He soon reached the end of his resources, and, just before the opening of the Seven Years’ War, he accepted a lieutenant-colonel’s commission, and set sail to take command in Hindostan. The Company appointed him governor of Fort Saint David, a settlement near Madras; but he had hardly assumed his office before an event occurred which caused the conquest of Bengal. The Nabob of Bengal captured Calcutta, and imprisoned one hundred and forty-six of the English residents in the “Black Hole,” where, in a single night, one hundred and twenty-three perished.

Clive was summoned, and acted with his usual vigour. He routed the Nabob’s army, recovered Calcutta, and would have taken vengeance at once had not the civilians, who wanted to be restored to their places, interfered.

Long and tortuous negotiations followed, in which Clive displayed more than Oriental cunning and duplicity, ending in a march into the interior and the battle of Plassey. There, with one thousand English and two thousand sepoys, he met and crushed the army of the Nabob, sixty thousand strong. On June 23, 1757, one of the richest provinces of Asia lay before him defenceless, ripe for plunder. Eight hundred thousand pounds were sent down the Hooghly to Calcutta, in one shipment; Clive himself took between two and three hundred thousand pounds.

Like Drake and Hawkins, Clive had done great things for England, but he was a military adventurer, one of the class in whom the aristocracy recognized an enemy; and though in London he was treated with outward respect, and even given an Irish peerage, the landed interest hated him, and tried to destroy him, as in the next generation it tried to destroy Hastings.

Upon the plundering of India there can be no better authority than Macaulay, who held high office at Calcutta when the administration of Hastings was still remembered; and who less than any of the writers who have followed him, was a mouth-piece of the official class.333 He has told how after Plassey “the shower of wealth” began to fall, and he has described Clive’s own gains: “We may safely affirm that no Englishman who started with nothing has ever, in any line of life, created such a fortune at the early age of thirty-four.”334 But the takings of Clive, either for himself or for the government, were trifling compared to the wholesale robbery and spoliation which followed his departure, when Bengal was surrendered a helpless prey to a myriad of greedy officials. These officials were absolute, irresponsible, and rapacious, and they emptied the private hoards. Their only thought was to wring some hundreds of thousands of pounds out of the natives as quickly as possible, and hurry home to display their wealth.

“Enormous fortunes were thus rapidly accumulated at Calcutta, while thirty millions of human beings were reduced to the extremity of wretchedness.” “The misgovernment of the English was carried to a point such as seems hardly compatible with the very existence of society. The Roman proconsul, who, in a year or two, squeezed out of a province the means of rearing marble palaces and baths on the shores of Campania, of drinking from amber, of feasting on singing birds, of exhibiting armies of gladiators and flocks of camelopards; the Spanish viceroy, who, leaving behind him the curses of Mexico or Lima, entered Madrid with a long train of gilded coaches, and of sumpter-horses trapped and shod with silver, were now outdone.”335

Thus treasure in oceans flowed into England through private hands, but in India the affairs of the Company went from bad to worse. Misgovernment impoverished the people, the savings of long years of toil were exhausted, and when, in 1770, a drought brought famine, the resources of the people failed, and they perished by millions: “the very streets of Calcutta were blocked up by the dying and the dead.” Then came an outbreak of wrath from disappointed stockholders; the landed interest seized its opportunity to attack Clive in Parliament; and the merchants chose Hastings to develop the resources of Hindostan.

As Sheridan said, the Company “extended the sordid principles of their origin over all their successive operations; connecting with their civil policy, and even with their boldest achievements, the meanness of a pedlar and the profligacy of pirates.” In Hastings the Company found a man fitted to their hands, a statesman worthy to organize a vast empire on an economic basis. Able, bold, cool, and relentless, he grasped the situation at a glance, and never faltered in his purpose. If more treasure was to be wrung from the natives, force had to be used systematically. Though Bengal might be ruined, the hoards of the neighbouring potentates remained safe, and these Hastings deliberately set himself to drain. Macaulay has explained the policy and the motives which actuated him: —

“The object of his diplomacy was at this time simply to get money. The finances of his government were in an embarrassed state, and this embarrassment he was determined to relieve by some means, fair or foul. The principle which directed all his dealings with his neighbours is fully expressed by the old motto of one of the great predatory families of Teviotdale, ‘Thou shalt want ere I want.’ He seems to have laid it down, as a fundamental proposition which could not be disputed, that, when he had not as many lacs of rupees as the public service required, he was to take them from anybody who had. One thing, indeed, is to be said in excuse for him. The pressure applied to him by his employers at home, was such as only the highest virtue could have withstood, such as left him no choice except to commit great wrongs, or to resign his high post, and with that post all his hopes of fortune and distinction.”336

How he obtained his money, the pledges he violated, and the blood he spilt, is known as few passages of history are known, for the story has been told by Macaulay and by Burke. How he robbed the Nabob of Bengal of half the income the Company had solemnly promised to pay, how he repudiated the revenue which the government had covenanted to yield to the Mogul as a tribute for provinces ceded them, and how, in consideration of four hundred thousand pounds, he sent a brigade to slaughter the Rohillas, and placidly saw “their villages burned, their children butchered, and their women violated,” has been described in one of the most popular essays in the language. At Hastings’ impeachment, the heaviest charge against him was that based on his conduct toward the princesses of Oude, whom his creature, Asaph-ul-Dowlah, imprisoned and starved, whose servants he tormented, and from whom he wrung at last twelve hundred thousand pounds, as the price of blood. By these acts, and acts such as these, the treasure which had flowed to Europe through the extermination of the Peruvians, was returned again to England from the hoards of conquered Hindoos.

CHAPTER XI

MODERN CENTRALIZATION

In discussing the phenomena of the highly centralized society in which he lived, Mill defined capital “as the accumulated stock of human labour.” In other words, capital may be considered as stored energy; but most of this energy flows in fixed channels, money alone is capable of being transmuted immediately into any form of activity. Therefore the influx of the Indian treasure, by adding considerably to the nation’s cash capital, not only increased its stock of energy, but added much to its flexibility and the rapidity of its movement.

Very soon after Plassey the Bengal plunder began to arrive in London, and the effect appears to have been instantaneous, for all authorities agree that the “industrial revolution,” the event which has divided the nineteenth century from all antecedent time, began with the year 1760. Prior to 1760, according to Baines, the machinery used for spinning cotton in Lancashire was almost as simple as in India;337 while about 1750 the English iron industry was in full decline because of the destruction of the forests for fuel. At that time four-fifths of the iron in use in the kingdom came from Sweden.

Plassey was fought in 1757, and probably nothing has ever equalled the rapidity of the change which followed. In 1760 the flying-shuttle appeared, and coal began to replace wood in smelting. In 1764 Hargreaves invented the spinning-jenny, in 1779 Crompton contrived the mule, in 1785 Cartwright patented the power-loom, and, chief of all, in 1768 Watt matured the steam-engine, the most perfect of all vents of centralizing energy. Hut though these machines served as outlets for the accelerating movement of the time, they did not cause that acceleration. In themselves inventions are passive, many of the most important having lain dormant for centuries, waiting for a sufficient store of force to have accumulated to set them working. That store must always take the shape of money, and money not hoarded, but in motion.

Thus printing had been known for ages in China before it came to Europe; the Romans probably were acquainted with gunpowder; revolvers and breech-loading cannon existed in the fifteenth and sixteenth centuries, and steam had been experimented upon long before the birth of Watt. The least part of Watt’s labour lay in conceiving his idea; he consumed his life in marketing it. Before the influx of the Indian treasure, and the expansion of credit which followed, no force sufficient for this purpose existed; and had Watt lived fifty years earlier, he and his invention must have perished together. Considering the difficulties under which Matthew Boulton, the ablest and most energetic manufacturer of his time, nearly succumbed, no one can doubt that without Boulton’s works at Birmingham the engine could not have been produced, and yet before 1760 such works could not have been organized. The factory system was the child of the “industrial revolution,” and until capital had accumulated in masses capable of giving solidity to large bodies of labour, manufactures were necessarily carried on by scattered individuals, who combined a handicraft with agriculture. Defoe’s charming description of Halifax about the time Boulton learned his trade, is well known: —

“The nearer we came to Halifax, we found the houses thicker, and the villages greater, in every bottom; … for the land being divided into small enclosures, from two acres to six or seven each, seldom more, every three or four pieces of land had an house belonging to them.

“In short, after we had mounted the third hill, we found the country one continued village, tho’ every way mountainous, hardly an house standing out of a speaking distance from another; and, as the day cleared up, we could see at every house a tenter, and on almost every tenter a piece of cloth, kersie, or shalloon; which are the three articles of this countries labour…

“This place then seems to have been designed by providence for the very purposes to which it is now allotted… Nor is the industry of the people wanting to second these advantages. Tho’ we met few people without doors, yet within we saw the houses full of lusty fellows, some at the dye vat, some at the loom, others dressing the cloths; the women and children carding, or spinning; all employed from the youngest to the oldest; scarce anything above four years old, but its hands were sufficient for its own support. Not a beggar to be seen, nor an idle person, except here and there in an alms-house, built for those that are antient, and past working. The people in general live long; they enjoy a good air; and under such circumstances hard labour is naturally attended with the blessing of health, if not riches.”338

To the capitalist, then, rather than to the inventor, civilization owes the steam engine as a part of daily life, and Matthew Boulton was one of the most remarkable of the race of producers whose reign lasted down to Waterloo. As far back as tradition runs the Boultons appear to have been Northamptonshire farmers, but Matthew’s grandfather met with misfortunes under William, and sent his son to Birmingham to seek his fortune in trade. There the adventurer established himself as a silver stamper, and there, in 1728, Matthew was born. Young Boulton early showed both energy and ingenuity, and on coming of age became his father’s partner, thenceforward managing the business. In 1759, two years after the conquest of Bengal, the father died, and Matthew, having married in 1760, might have retired on his wife’s property, but he chose rather to plunge more deeply into trade. Extending his works, he built the famous shops at Soho, which he finished in 1762 at an outlay of £20,000, a debt which probably clung to him to the end of his life.

Boulton formed his partnership with Watt in 1774, and then began to manufacture the steam-engine, but he met with formidable difficulties. Before the sales yielded any return, the outlay reduced him to the brink of insolvency; nor did he achieve success until he had exhausted his own and his friends’ resources.

“He mortgaged his lands to the last farthing; borrowed from his personal friends; raised money by annuities; obtained advances from bankers; and had invested upwards of forty thousand pounds in the enterprise before it began to pay.”339

Agriculture, as well as industry, felt the impulsion of the new force. Arthur Young remarked in 1770, that within ten years there had been “more experiments, more discoveries, and more general good sense displayed in the walk of agriculture than in an hundred preceding ones”; and the reason why such a movement should have occurred seems obvious. After 1760 a complex system of credit sprang up, based on a metallic treasure, and those who could borrow had the means at their disposal of importing breeds of cattle, and of improving tillage, as well as of organizing factories like Soho. The effect was to cause rapid centralization. The spread of high farming certainly raised the value of land, but it also made the position of the yeomanry untenable, and nothing better reveals the magnitude of the social revolution wrought by Plassey, than the manner in which the wastes were enclosed after the middle of the century. Between 1710 and 1760 only 335,000 acres of the commons were absorbed; between 1760 and 1843, nearly 7,000,000. In eighty years the yeomanry became extinct. Many of these small farmers migrated to the towns, where the stronger, like the ancestor of Sir Robert Peel, accumulated wealth in industry, the weaker sinking into factory hands. Those who lingered on the land, toiled as day labourers.