Colonists increasingly complained about mercantilism, but did it harm them? The chronic colonial shortage of hard money was superficially caused by the flow of specie—gold and silver—to England to meet the “unfavorable” balance of trade. The rapidly growing colonial economy consumed far more manufactured products than it could pay for out of current production. To be “in debt” to England really meant that the English were investing capital in America, a state of affairs that benefited lender and borrower alike.
Important colonial products for which no market existed in England (such as fish, wheat, and corn) were never enumerated and moved freely and directly to foreign ports. Most colonial manufacturing was untouched by English law. Shipbuilding benefited from the Navigation Acts, since many English merchants bought vessels built in the colonies. Between 1769 and 1771, Massachusetts, New Hampshire, and
5-Year Averages (1774: 4-Year Average)
Colonial Trade with England, 1700-1774
Rhode Island yards constructed perhaps 250 ships of 100 to 400 tons for transatlantic commerce and twice that many sloops and schooners for fishermen and coastal traders.
Two forces that worked in opposite directions must be considered before arriving at any judgment about English mercantilism. While the theory presupposed a general imperial interest above that of both colony and mother country, when conflicts of interest arose the latter nearly always predominated. Whenever Parliament or the Board of Trade resolved an Anglo-American disagreement, the colonists tended to lose.
Complementary interests conspired to keep conflicts at a minimum, but in the long run, as the American economy became more complex, the colonies would have been seriously hampered and much more trouble would have occurred had the system continued to operate.
On the other hand, the restrictions of English mercantilism were greatly lessened by inefficiency. The king and his ministers handed out government posts to win political favor or to repay political debts, regardless of the recipient’s ability to perform the duties of the office.
Transported to remote America, this bumbling and cynical system scarcely functioned at all when local opinion resisted it. Smuggling became a respected profession, and bribery of English officials a standard practice. Despite a supposedly prohibitive duty of sixpence a gallon imposed by the Molasses Act of 1733, molasses from the French West Indies continued to be imported. The duty was seldom collected.
Mercantilist policies hurt some colonists such as the tobacco planters, who grew far more tobacco than British consumers could smoke. Tobacco planters wanted to ship directly to Dutch or French ports. But the policies helped others, and most people proved adept at getting around those aspects of the system that threatened them. In any case, the colonies enjoyed almost continuous prosperity, as even so dedicated a foe of mercantilist restrictions as Adam Smith admitted.
By the same token, England profited greatly from its overseas possessions. With all its inefficiencies, mercantilism worked. Prime Minister Sir Robert Walpole’s famous policy of “salutary neglect,” which involved looking the other way when Americans violated the Navigation Acts, was partly a bowing to the inevitable, and partly the result of complacency. English manufactures were better and cheaper than those of other nations. This fact, together with ties of language and a common heritage, predisposed Americans toward doing business in England. All else followed naturally; the mercantilist laws merely steered the American economy in a direction it had already taken.
World History
