Unseen Hand in British History - Ian D. Colvin

XI. The Balance of Power

The "Glorious Revolution" of 1688 is a favorite theme of the Whig historian, who looks upon it as a sort of tabernacle in which are enshrined all his favorite maxims and principles like the emerods and mice in the Ark of the Israelites. But to students who preserve their common sense the search for these so-called Liberal principles seems a vain and dreary business. The age is one rather to encourage the cynic such a quagmire of corruption and treachery that nothing but rushes, that sway in every wind and are rooted in mud, might be expected from it. Macaulay has idolized that arid lawyer, Somers, who proved from "Grotius, Brisonius, Budeus, Spigelius, and the Code" that "abdication" was the right word to use when a king was chased out of his kingdom by his subjects and his son-in-law. "The Party of Liberty" opposing a Toleration Act is matter more for mirth than admiration. And Mackintosh himself in a moment of candor confesses that there are other fatal obstacles to the traditional view of the Whigs:

"The Whigs and Tories," he says of the great debate of 1689, "would now appear to have changed places. The former became of a sudden strangely insensible to the importance of securing the rights and privileges of the subject. They were satisfied with deposing James and enthroning William, and would impose the triumph of their party and their idol as the triumph of the people. The Tories took the higher ground of securing the nation in its liberties, and to them belongs the chief merit of the subsequent declaration of rights."

As for William, a "Calvinist First Minister of a Calvinist Republic," among whose allies and secret confederates were the King of Spain, the Republic of Venice, and the Pope, he could hardly have had any burning zeal either for Liberal principles or the Protestant religion.

When we come to those great interests which are the secret motives of men and nations we get at once upon solid ground. For with the reign of William we go down into that great troubled ocean of war which lasted with intervals of peace for upwards of a century war, the object of which was nothing less than the mastery and commerce of the world.

The student of the seventeenth century sees the struggle approaching. The protective policy of Henri IV, of Richelieu, and of Colbert had built up France as a strong manufacturing and naval Power.

In 1674 the famous "balance" or "old scheme" of trade was drawn up by some London merchants, and this balance, modeled in detail by subsequent economists, but always recognized as right in substance and in fact, became the short formula on which hostility to France was based.

Now this theory of the balance of trade was used astutely by Adam Smith the greatest of all controversial strategists to discredit the whole mercantile conception of a national policy. So before we go further we must examine a little more closely the principles of what is called Mercantilism. For on those principles, as we shall find, the national policy of England was based.

The so-called scheme, or "old scheme" as it is called, in those lively controversies between the Mercator and the British Merchant, was presented by the London merchants to the Lords Commissioners for the Treaty of Commerce with France on November 29, 1674. It was drawn from the Customs returns, and showed that "the exports of our native commodities and manufactures to France are less by at least a million sterling than the French native commodities and manufactures we receive." The total exports of England to France was put at £171,021 6s. Sd., and of France to England at £1,136,150. Nor was this all, for the French were manufacturing excellent woolens, linens, and silks, and the adverse balance in manufactured goods was paid for in gold.

It was the recent fashion among our economists and historians to sneer at the notion that an adverse balance in trade might exhaust the treasure of a nation. But England at that time was just emerging from a condition when money was so scarce as to make an extensive national commerce almost impossible. Throughout the Middle Ages the Hanseatic League had commanded and restricted for its own purposes the currency of Europe: in the seventeenth century the Dutch commanded money at from 3 to 4 percent, whereas the English rate was 6 or 7. There were frequent and severe money famines in Spain owing, as the English believed, to her necessity of importing all manufactures as much as to her constant wars; and the theory was firmly held that, England having no mines, the sale of her manufactures was her means of obtaining gold.

To say that the Mercantilists regarded gold as the only real wealth is to misrepresent them. Mun, one of the clearest and the best of their writers, put the opposite in his terse and admirable phrase: "They that have wares cannot want money." But the Mercantilists knew as well as we know now that a command of money was a necessity to the independence as well as the prosperity of the nation. It was true then as it is now that the borrower is the slave. Therefore the national policy was to keep enough treasure within the kingdom for the needs of the Crown, the rents of land, and the national commerce, and the means to this end was to encourage the export and discourage the import of manufactures.

Mun clearly distinguished between the gain of the merchant and the profit of the kingdom, and it is the glory of Mercantilism that it subordinated private gain to national ends, its object being not merely wealth, but the security and independence of the kingdom. This doctrine inspired the Navigation Laws against Holland; and this doctrine opposed England in turn to the Powers of Spain, Holland, and France.

Thus, for example, Sir Theodore Janson, as the first of his General Maxims in Trade, lays it down "that a trade may be of benefit to the merchant and injurious to the body of the nation."

And he proceeded thus to elaborate this maxim:

  • "That the exportation of manufactures is in the highest degree beneficial to a nation.
  • "That the exportation of superfluities is so much clear gain.
  • "That the importation of foreign materials to be manufactured by us, instead of importing manufactured goods, is the saving a great deal of money.
  • "That the exchanging commodities for commodities is generally an advantage.
  • "That all imports of goods which are re-exported leave a real benefit.
  • "That the letting ships to freight to other nations is profitable.
  • "That the imports of things of absolute necessity cannot be esteemed bad.
  • "That the importing commodities of mere luxury is so much real loss as they amount to.
  • "That the importation of such goods as hinder the consumption of our own, or check the progress of any of our manufactures, is a visible disadvantage, and necessarily tends to the ruin of multitudes of people."

These were the real principles of the Whigs of the Revolution. They applied them to the trade with France, and they found that the French trade was dangerous to England. Our imports from France of linens interfered with the linen trade of Ireland and Lancashire; of silks with the silk manufacture of Spitalfields and Canterbury; their brandy struck at our "extracts of malt and molasses"; and as for "all manner of toys for women and children, fans, jessamin gloves, laces, point-laces, rich embroidered garments, and rich embroidered beds and other vestments, of an incredible value," these choice products of French genius, as they had to be bought with "treasure," were held to impoverish the nation.

Moreover, France, as we have seen, now commanded Southern Germany, and was there introducing French woolens in opposition to our own; she threatened Holland and the Spanish Netherlands, the great entrepot of the English woolen trade; she had an alliance with Sweden, directed against our interests in the Baltic; she was establishing a Bourbon dynasty in Spain, thereby arriving at a monopoly of the most profitable trade of Europe; she was strong in Italy through her connexion with Spain; and her consummate diplomacy as well as geographical advantage gave to Marseilles a growing share of the Levantine and Turkish trade.

Here, then, we have the general lines of a commercial and industrial rivalry between France and England which, whatever we think of the balance of trade argument, was in itself no fiction but a fierce reality. The two nations were rivals for that "fair mistress of trade," not merely the trade of Christendom, but of the world. As the case was ironically put by one of the pamphleteers of the time:

"That two woolen drapers, two mercers, two linen drapers, and two stationers vying for customers in their distinct trades ought only to trade with each other, I proceed to show that we should only trade with France."

If we were to trace the moves in this great contest we should arrive at some notion of the motives underlying the national policy of England at that time.

It was first of all necessary to get a Government free from any taint of enemy influence.

"The retreat of King James," says another pamphleteer, "the happy Revolution that followed it, and the reduction of Ireland have been the degrees by which the nation has been put in a state to act with vigor against the common enemy. It was not enough to be governed by a Prince that would not be discouraged by difficulties nor disturbed by dangers, who commands his armies in person and animates them by his example. The state of affairs required, besides this, that this Prince should have credit enough in Germany to oppose with success the intrigues of France there, and that he should be at the head of the forces of a powerful Republick both by sea and land."

The French design to be master of the Low Countries gave England the same interest in Holland as when Elizabeth had fought there the designs of Spain.

"'Tis a truth of which none can doubt," says the same writer, "that the conquest of the Low Countries would put France into a condition of giving laws to all Europe." And again: "If Flanders be an accession to France, Holland must soon follow, and England next. They are like ninepins; the throwing down one carries the rest. Antwerp itself, were it in French hands, would command the trade of Christendom."

Here, then, was the reason for bringing over William. The alliance with Holland enabled England to meet France upon the sea on slightly more than equal terms. Intimate relations with Hamburg and Denmark countered the alliance of France with Sweden in the Baltic. The German Princes were subsidized and the Empire reanimated into something faintly approaching its old unity. The French command of the Rhine Valley and of Flanders was contested by arms.

But the sinews of war came from the Peninsula, and there Louis obtained the Spanish succession for the Dauphin. It was a stroke which threatened the whole British trade system. "We are in the greatest danger," exclaims an ingenuous pamphleteer, "of losing our trade, our liberty, and our religion." The Mediterranean could be shut against us:

"Nor is there anything to hinder the French from monopolizing the wool of Spain, which would at once destroy our fine drapery, which is perhaps the only considerable manufacture in which we have no dangerous rival. . . . Besides, can we doubt that whenever the French shall desire it, the Spaniards will clog our trade to Spain with such exorbitant duties, and give us such other troubles and vexations that we shall be obliged to quit that gainful commerce, which will be engrossed by France, where all the money that comes from America will then enter in return for the linen and woolen manufactures; it will be able to supply their Indies and Spain withal."

England's replies were the Methuen Treaty with Portugal of December 27, 1703, and the capture of Gibraltar on July 24, 1704, two of the greatest strokes in our history, for the one secured us the gold of the Indies, the other the trade of the Mediterranean.

John Methuen, it may be worth remembering, was the son of Paul Methuen of Bradford, in Wiltshire, when the Wiltshire Bradford was to the cloth trade of England what its northern namesake has since become. Paul was "the greatest cloathier of his time," and in the reign of Charles II had helped to get the cloth-finishing trade from the Dutch by importing skilled workers from Holland. John was one of those rare diplomatists who understood the interest of his country. He was fortunate also in being in the graces of the King of Portugal, whose Prime Minister was laboring to create a national cloth manufacture by a policy of high duties.

The unseen hand of Methuen was all-powerful.

"Methuen," says the British Merchant, "carried this treaty by his personal interest with the King, with whom alone he transacted it, and whose chief Minister knew nothing of it till he had orders to sign it."

It might have been written upon a half-sheet of note-paper, and had only three articles. Upon the one side the King bound himself and his successors "to admit for ever hereafter into Portugal the woolen cloths and the rest of the woolen manufactures of the Britains as was accustomed," upon the condition:

"That Great Britain admitted Portuguese wines at the rate on which French wines were admitted, less a third."

For this not only Methuen but his relations were buried in Westminster Abbey by a grateful nation; but it is fair to remember that although the achievement was his, the conception belonged to our Merchant Adventurers. As far back as the Long Parliament our London merchants had memorialized the Government on the lines of the Methuen Treaty.

The value of this treaty was never doubted by any Englishman before the time of Adam Smith, and it is still the admiration of foreign economists,

"By that glorious treaty," exclaims the British Merchant, ". . . we paid our Armies in Spain and Portugal and drew from thence in the late war considerable sums for our troops in other parts without remitting one farthing from England, and at the same time coined in the Tower above a million of Portugal gold in three years. By this treaty we gain a greater balance from Portugal than from any other country whatsoever."

And, with that late exception, it is the universal testimony of the eighteenth century that our forefathers drank themselves to victory. Our statesmen set an heroic example to the rest of the nation. Those mantling and golden ruby-hearted wines, in whose sunny depths glowed the brave and ardent soul of Portugal, gave at once the inspiration and the means of victory. And if France was cruelly revenged in the gout of Chatham and the pricking toes of many other noble Englishmen, may we not say that they suffered gladly in a great style for a great cause?

By these measures, and by that act of royal folly the Revocation of the Edict of Nantes, as well as by the genius of Marlborough and Maurice, the French power, lately supreme in Europe, was crippled. The attack on the economic foundations caused the military and naval superstructure to totter and crumble.

That the war had to be fought over again was due to a party quarrel which robbed England of the fruits and security of a complete victory.