The Sugar Barons (53 page)

In August 1760, Pitt, having been told by his commander in North America that the Rhode Islanders were ‘a lawless set of smugglers’, wrote a circular letter to all the American governors railing against the ‘illegal and most pernicious trade … by which the enemy is … supplyed with Provisions and other Necessaries whereby they are principally, if not alone, enabled to sustain, and protract, this long and expensive war’. He urged that offenders be severely punished. But although some states passed new laws against the trade, this had little effect. The following year, while Royal Navy ships languished in port for want of victuals, the French were plentifully supplied. Indeed, flour was 50 per cent cheaper in Hispaniola than in Jamaica.

It was immensely frustrating for British naval commanders, who could see that the illegal trade had effectively negated important advantages of their supremacy at sea. In 1762, Admiral Augustus Keppel complained that the French fleet and garrison at St Domingue were not likely to want for food, because of ‘the large supplies they have lately received from their good friends the New England flag of truce vessels’. During the siege of Havana, the British naval contingent found that they had to ‘guard as much against’ North American vessels supplying the Spanish garrison ‘as our professed enemies’.

Not all North Americans showed so little imperial sentiment. On 12 August, the brigantine
Prudent Hannah
, owned by Obadiah Brown and his four nephews, and captained as a flag of truce by Paul Tew, was seized by a British man-of-war off the coast of Virginia. Tew urged the British captain to take him to a northern port, but instead he was taken to Williamsburg. Paperwork signed off by Elisha Brown stated that he had five barrels of pork or beef and 30 of flour. In fact the
Prudent Hannah
carried 47 barrels of flour, 37 of beef and pork, 213 barrels and hogsheads of fish and firkins of butter, as well as bread, and 1,000 bunches of onions. When he got to shore, Tew wrote to the Browns, ‘they Looked on me as an Enemy and Trator to my Country’.

This was certainly the view in England, and the illegal trade in sugar and molasses by the North Americans would have some very important consequences. More than ever, the colonials were seen in Britain as corrupt and self-serving, having preferred to trade with the enemy rather than
support the war effort. Measures taken by the Royal Navy against this traffic led to a review of the whole system of enforcing trade and revenue laws in America, and the use of the Royal Navy to suppress smuggling found a ready place in George Grenville and Charles Townsend’s plans for a new imperial system.

In many ways the decade after the end of the war in 1763 represents the high-water mark of the ‘first’ British empire. Peace brought a further expansion of trade in tropical and subtropical commodities: not only sugar, but also tea and spices from India and China, tobacco, rice and indigo from the southern mainland colonies of North America, rum, coffee, cotton and dye woods from the West Indies flowed into the mother country to raise standards of material welfare, pay for the reverse flow of British manufactures and employ ships and seamen for the Royal Navy, which provided global security for the system.

But in other ways, it was the beginning of the end. There were danger signs in the disloyalty and lack of respect for the law shown by the illegal traders, particularly now that France had been expelled from North America, removing the threat that had kept the Americans close to the British. Furthermore, the war had left Britain with a colossal debt of £140 million and vastly enlarged imperial responsibilities, problems and expenses. Difficulties with hostile Native Americans meant that 8,000 soldiers were to be stationed in America, twice as many as in 1754, and a North American squadron maintained of 26 ships and 3,290 men, the largest in the Royal Navy apart from the Home Fleet. British taxpayers thought the ungrateful colonials should start to share the expense.

Meanwhile, in the West Indies, the expansion of the empire achieved at the Peace of Paris was to have unforeseen and unfortunate consequences.

PART THREE
The Inheritors

26
LUXURY AND DEBT

‘Sugar, sugar, is the incessant cry of luxury, and of debt.’

Reverend James Ramsay

Gedney Clarke, the Barbados-based trader, customs collector, planter and friend of George Washington, had not had a good war. It appears that the government victualling contracts that he had secured had not been as profitable as expected, and a loan of £15,000 from the Lascelles was needed to keep the operation going. In 1763, the London money market took a sharp downturn, and speculators were badly burned, Clarke among them.

The same year, a huge slave revolt broke out in the Dutch colony of Berbice, where the white population had been decimated by an ‘epidemical disorder’, and where Clarke had substantial estates. As soon as he heard, Clarke, at huge expense, dispatched four armed vessels to Berbice. On board were 50 Barbados militiamen, whom Clarke had persuaded to come with ‘Threats, Arguments & the force of money’. This body was augmented by 100 marines and sailors aboard HMS
Pembroke
, lent to Clarke by his friends in the Royal Navy, even though there was no official sanction for the task force, whose role was clearly to protect the property of Gedney Clarke. Other recruits made the force up to 300, and its contribution to the defeat of the rebellion was crucial.

But in August 1764, Gedney Clarke junior, who had settled in London and recently succeeded George Maxwell as a partner in the Lascelles firm, heard news ‘of the Extream Illness of Col. Clarke’. Due to the ‘severity of his Feaver and other disorders’, Gedney Clarke Sr was dying. What was more, his business affairs were in turmoil. ‘Thus I am placed in his shoes’, his son wrote soon afterwards. Clarke Jr had been enjoying establishing
himself in London, but he now had to return to Barbados to sort out the mess and to take over the family customs position.

In the 10 years after 1744, Henry Lascelles had lent Clarke around £30,000. After Henry’s death in 1753, his sons had continued to proffer assistance. Now the debts were out of control. Clarke Jr’s first move was to sell his holdings in the Dutch colonies. It was good timing, but he simply exchanged one imminent disaster for another. With the proceeds he purchased four new plantations in the recently-ceded territories of Grenada and Tobago. In Tobago alone he bought more than 2,000 acres on his own account or in partnership.

After the end of the Seven Years War, many others, a lot of them Scots, rushed to plant the newly British and relatively undeveloped islands of Dominica, St Vincent, Grenada and Tobago with sugar. The lure of sugar profits led to a wave of speculation in land, with prices rising to ridiculous levels. Thus Gedney Clarke paid inflated prices for the land in Tobago, using mortgages that could be financed only for as long as sugar prices remained high and interest charges stayed low. But profits were disappointing. The new plantations in the ceded islands, together with an increase in production from the Dutch in Surinam and the French in St Domingue, saw the world sugar price start to slide.
⁵¹
There was also a great increase in demand for slaves, pushing up the price considerably. A field worker who had cost £25 in 1755 went for £60 in 1770.

Income from the new estates and those on Barbados hardly covered Gedney Clarke’s current account with the London Lascelles company, and so interest on the overall debt kept rising. In desperation, Clarke took to embezzling customs revenue. In 1771 this was spotted, and a commission of inquiry was dispatched to Barbados. Clarke, it emerged, had taken more than £15,000, plus large balances in kind. He was suspended, but amazingly had the political contacts to get himself reinstated, just as his father had done, and the Lascelles brothers before him.

But a credit crisis and a sharp fall in the price of sugar in 1772–3 saw the end for Gedney Clarke. By now the Lascelles were owed some £130,000. It seems from their books that they had been illegally charging compound interest. Either Clarke did not know about this, or he was so desperate that he was forced to agree to the terms. Worried about competition from other creditors, the Lascelles family took over the Gedney Clarke property. It was the most spectacular bankruptcy the West Indies had seen so far, described in a letter of 1774 as ‘the greatest failure that ever happened
here’. In all, Clarke was in the red to the tune of about £200,000. Four years later and now paupers, Gedney Clarke and his wife both died on Barbados.

Although none were quite so noteworthy, there were many other early failures in the ceded islands, where planting was often hindered by difficulties with the terrain, with slaves who had escaped during the capture of the islands, and with the Caribs who still lived on several of the islands, most notably Dominica and St Vincent. Among those going under was the Attorney General of Grenada, Joseph Baker, who ended up arrested and imprisoned for debt in England.

Sugar planters had always borrowed money. Many plantation operations were carried on essentially by credit based upon anticipated income from the next crop. Huge advances had been secured with ease, and this often led to great extravagance, and the brushing aside of natural caution in financial matters, engendering a spirit of speculation without due regard for the actual risk involved.

But by the 1770s, planters in Grenada alone owed something like £2,000,000, a vast amount of money. In all, the ceded islands were a huge drain on capital and credit, and this contributed to the 1772 collapse of a large Scottish bank and the ensuing credit crisis.

There were also huge debts in Jamaica. Sir Charles Price, an almost pre-eminent figure in Jamaican politics since the 1740s, had by the 1770s accumulated more than 26,000 acres across 11 parishes. But such expansion was more a symptom of megalomania than sound business sense. The plantations were severely burdened by debt, and on the cusp of reclamation by mortgage holders. Sir Charles now preferred to live at the Decoy, a mansion 2,000 feet up in the hills of St Mary parish. Here he entertained visitors from England, who could enjoy the surrounding park, grazed by imported fallow deer, in a weird, totally inappropriate mimic of the aristocracy at home. In front of the house was ‘a very fine piece of water, which in winter is commonly stocked with wild-duck and teal’, a visitor reported. Behind was an elegant garden, with numerous richly ornamented buildings and a triumphal arch. Here at the Decoy, Sir Charles would live out his final years before his death in 1772, shielded from the world and his collapsing fortune.

His son, the second baronet, also Charles, moved to England in 1775, intending never to return to Jamaica. But the financial difficulties of the Jamaica plantations brought him back, and he died on the island in 1788. Eight years later, a Kingston magazine described the Prices as ‘that respectable but unfortunate family’.

In other ways the sugar barons were losing their lustre. In 1776, the Scottish economist and philosopher Adam Smith published his hugely influential
The Wealth of Nations
, in which he argued in favour of free trade and against mercantilism, the policy whereby British sugar was given an effective monopoly on the home market in return for using British ships and buying British manufactures. The first sugar barons had hated the Navigation Acts, but by the middle of the eighteenth century, the protected British market that was part of the original deal was of overwhelming importance to the British sugar producers. Because of soil exhaustion and a failure to invest in new technologies, the British islands now needed four times the labour to produce the same sugar as the newer French possessions, led in production by St Domingue. This, of course, made British sugar more expensive, thus the British consumer paid up to 30 per cent more for his sugar than customers in other parts of Europe. A pamphleteer of 1761 estimated that what he called the ‘fraudulent Trading of the Sugar Planters’ had deprived the kingdom of ‘over and above Twelve Million Pounds Sterling’.

In some ways, the mercantilist policy had undoubted benefits for the nation. The system guaranteed supply of the commodity and profits at home from processing and, until the European market was lost to the French, re-exporting it. An overseas market was secured for finished British goods (exports to all the American colonies expanded by over 2,000 per cent during the eighteenth century); and it supported the growth of the civil (and military) marine. Substantial duties were paid when the sugar arrived at a British port, even if they were much lower than for other tropical products.

But the cost of the preferential duties was paid by the British consumer, and the costs of administration and defence of the colonies by the British taxpayer. The mercantilist policy might have tied the colonies to the mother country, but in the final reckoning economically it did little more than provide income for the government and enrich a special interest group. Adam Smith declared that ‘the interest of the home-consumer has been sacrificed to that of the producer with a more extravagant profusion than in all our other commercial regulations’.

The system had also, of course, severely limited the development of the West Indian islands. Industry was strongly discouraged as part of the mercantile system. Market towns and ports were all that could develop. Jamaica had to import processed white sugar from England, as its two tiny refineries could not even satisfy domestic demand. Cushioned by the ever-rising demand for their product and by the home market monopoly, those
planters still on the islands, rather than the absentees, stagnated, and the energy and verve of their fathers and grandfathers ebbed and slipped away. If the market for sugar was ‘unreal’, so were the islands’ economies, now an artificial creation, sustained by political intervention rather than the true market price for their product. But still sugar monoculture expanded. By the late eighteenth century, sugar accounted for 93 per cent of Barbados’s exports.