Finding the Founding (Part III): Profit, Taxes and Colonial Models

Even when England got it right, England got it wrong …. at least initially, they got it wrong. Eventually, England did get it right, and as it seems so often with that realm, they got it more correct than most ever did.

England realized by the mid-1600s that the road to greatness was going to be through industrial agriculture in New World colonies.  At the same time England embarked on two divergent tasks: developing the world’s first modern democracy, and becoming the dominant power in the slave trade. The English Civil War of the 1640s brought about the notion of rights and votes, a republic (that deteriorated into a dictatorship), religious liberty and shared government. At the same time English maritime power was invading Atlantic trade routes and taking over coastal fortresses in Africa which provided the foundation for the slave trade.

Elmina Castle: A slave fortress off the Coast of modern day Ghana 

This second task of taking over control of the trade in African slaves coming in to New World colonies propelled England from a small time kingdom trying to gain back some semblance of continental power into a global empire. The cost of empire – the cost of wealth, the cost of power, even the cost of democracy – was through the brutal destruction and devastation of millions of lives the likes of which … oh, actually, just the typical d and d of empires, but capitalism provided its own sinister twist.

Capitalism as an economic system was still in its formative practical stage – in Europe, anyway, having been found in its proto form in the aftermath of Muhammad’s Revolution in the Arab Empires from 700-1000 c.e. What was developing in the New World was still a century away from its theoretical underpinnings in Adam Smith’s Wealth of Nations. The privatization of wealth occurring in Europe at this time was as Revolutionary as the steps toward representative government. Being able to retain the produce of investment and labor meant accessing personal autonomy in ways that blood based hierarchies of a Feudal system did not allow – since all wealth remained a function of the system, and was therefore public in nature. Government, the collector of public wealth, gained from private wealth accumulation through taxation on investment and production and therefore gained more as the private accumulator gained more. Under such a system king’s like Henry, but we’ll call him Harry, made off with a fortune. Even though in law taxes had been defined as “gifts” it was more like extortion – pay this or else, but taxes also added to incentive – you want more, you gotta earn more to make up for the government’s cut. And taxes did more important things than add incentive to the incentive based system of capitalistic economies.

Out of context, Blackstone seems a real tax hater,
but without them civil society can't survive.
But who has time to read all of his volumes Commentaries on the Laws of England

Taxes, of course, went to the opulent lifestyle of the main collectors of taxes, Kings and Queens. As public income, however, taxes also went to public purposes, mostly in the public expenditure of protecting the system. Navies protected the instruments of investment – navies protected holdings in Africa, protected trade routes, protected colonies -- Investment to protect investment. And in the 1600s invest England did in navies and in the spaces navies could help acquire, colonies. By the 1650s England had begun to acquire Caribbean colonies, most notably Barbados and Jamaica, and these colonies were turned into sources of profit both private and public. But England’s foray into New World Capitalism diverged from the typical Columbian model at first, and was possible effected by the growing ideas of a democratic society brewing at home.

Barbados in itself reveals the two models of colonization followed by the English: settlement colonies and industrial colonies. Barbados started as the former and converted to the latter. When Barbados was first settled it was done so primarily by family groupings who came to work the land and be independent. Being independent meant controlling your own life, having land, producing for yourself and your family – not being dependent on the good graces of your hereditary lord. It was, for all intents and purposes, the middle class ideal that motivated much of the theory and practice of the the English Civil War. But at the time when democracy was growing, and growning and mutating into Cromwell’s dictatorship, colonial ventures were also “growing” because of the potential for profit. So leaving aside political ideas for now, Barbados began a conversion to cash-crop industrial production that was eventually propelled into massive profit through slave labor. After initial experiments in what historians have categorized as family farms, cash crop production in tobacco and other items was underway by the 1650s. And just like in Barbados’ poorer cousin colony, Virginia, the main labor source were English “indentured servants.”

Sign your Life Away document or
The good old days before Unions

I put that in quotes because they may as well be called slaves, but technically in law they were contracted laborers who signed their life over to a “master” for a designated period, so that defines them as only temporary slaves, or “indentured servants.” Since the life expectancy of laborers in the New World was less than the 7 years of most indentures, kind of means you signed over your life. But by the 1680s this labor system, as also happened in Virginia, changed from “temporary” white English servants to “permanent” African slaves – and the crop changed from tobacco to sugar. In so doing the settlement colony of English seeking independence transformed into an industrial colony of English investors seeking sugar profits through African labor – just like the Spanish model before them.

The Spanish Colonial Model, inspired by Columbus, developed systems of mass production through slave labor that created tremendous wealth. Great for wealth creation for investors but a nightmare of brutality for those creating that wealth in the fields. Colonies like Barbados and Jamaica showed a clear contradiction that capitalism can present for the growth and development of democracy. By 1700 England, soon to be “Great” Britain, was growing into the world’s pre-eminent empire on the strength of its industrial colonies. Ironically, at home, political ideas were becoming increasingly focused, not on profit, but on the nature of the community and its obligations to individuals within the realm. This conversation would find a willing home in a set of colonies to the north of the Caribbean, where the contradiction of capitalism created a clear divide with attempts to realize independence.