The American Nation: A History Part 7

1698. (French) Santo Domingo Company.

When the English commercial companies were to be chartered, it was not necessary to invent an entirely new type of organization. A model already existed ready to hand in the Society of Merchants Adventurers, of which the origin goes back certainly to the fifteenth century, perhaps still earlier. [Footnote: Lingelbach, Brief Hist. of the Merchant Adventurers, xxi.-xxv.] The sphere of trade of this body of exporting merchants extended along the coasts of France, the Netherlands, and Germany, opposite England, and some distance into the interior. [Footnote: Ibid,, xxvi.] It is true that the Merchants Adventurers had many mediaeval features which a.s.similated them more to the old merchant and craft guilds than to the more modern type of chartered commercial companies which were about to come into existence.

They had, like the craft guilds, a system of apprenticeship and different degrees of advancement in their membership. [Footnote: Lingelbach, Internal Organization of the Merchant Adventurers, 8-18.]

The members were all controlled by a "stint," according to which an apprentice in the last year of his term might ship one hundred pieces of cloth in the year; while a full freeman in the society could ship from four hundred to one thousand pieces a year, according to the length of time he had been a member. [Footnote: Lingelbach, Laws and Ordinances of the Merchant Adventurers, 67-74.] They were under strict regulations against forestalling and undue compet.i.tion. They could display and sell their cloth only upon Mondays, Wednesdays, and Fridays, and "No person shall stand watchinge at the corners or ends of streetes, or at other mens' Packhouses or at the house or place where anie clothe merchant or draper ys lodged, nor seeinge anie such in the street shall run or follow after hym with Intent to Entyce or lead hym to his packhouse, upon pain of fyve pounds ster." [Footnote: Lingelbach, Laws and Ordinances of the Merchant Adventurers, 89, 91.]

In many respects, on the other hand, the Merchants Adventurers were quite similar to the later chartered companies, whose period of existence their own overlapped. In fact, considering the early date of their origin, the tardy development of English economic life, and the obstacles to trading in a foreign country even so near as the continental seaboard, the conditions which confronted them were much the same as those which the later companies had to meet, and they met them in much the same way. They obtained a charter of incorporation from the king; they possessed a monopoly of trade in a certain territory, as against other men of their own nation; they had a common treasury for joint expenses; and they acted as, and were even called, "the English nation," in the foreign country which was their abiding- place. [Footnote: Lingelbach, Internal Organization, 29-34; Laws and Ordinances, pa.s.sim; and Charters of 1462 and 1564.] The Merchants Adventurers, therefore, might be looked upon as a late surviving mediaeval merchant guild, modified in form by the necessity of adapting itself to trading in a foreign country; or it might be considered as the earliest of the modern chartered commercial companies, still retaining in the seventeenth century some of its mediaeval features.

Viewed in either aspect, the Merchants Adventurers were a living model for the organization of the new type of companies, and the powers and form of government of the latter show a similarity to the older company which is certainly not accidental.

The five or six English companies whose dates of foundation lie within the sixteenth century all yield in importance, interest, and later influence to the East India Company, which was destined to an almost imperial existence of two centuries and a half, and which may well serve as the representative of the English chartered companies. Its origin was closely connected with the international relations of the last decades of the sixteenth century.

The availability of the port of Lisbon as the western distributing centre for Eastern goods ceased in 1580, when Portugal became a part of the dominions of the king of Spain. As war already existed between Spain and the Netherlands, and was soon to break out between Spain and England, commerce was much disturbed; and after a few years of troubled intercourse that port was closed to the merchants of Holland and England. The union of the crowns of Spain and Portugal at this time had much the same effect on the supply of Eastern goods to these two Protestant seaboard states that the conquests of the Turks in the eastern Mediterranean had had for the Italian cities a century before.

It was not likely that the two most vigorous, free, and commercially enterprising states of Europe would allow themselves long to be excluded from the most attractive and lucrative trade in the world.

After England, in her resistance to the Armada in 1588, applied the touchstone to the naval prestige of Spain and showed its hollowness, her merchants and mariners took heart and pressed directly to the East.

In 1591 an English squadron of three ships, under Captains Raymond and Lancaster, with the queen's leave, sailed down the western coast of Africa, rounded the Cape of Good Hope, followed the east coast to Zanzibar, and then pa.s.sed across to Cape Comorin, Ceylon, and the Malay peninsula. They had mixed fortune, but one vessel returned home laden with pepper, obtained for the most part from the hold of a Portuguese prize. In 1595 the first direct Dutch voyage was made along much the same route. Other English and Dutch voyages followed; and in 1600 and 1602, respectively the English and Dutch East India companies were chartered. The following a.n.a.lysis of the charter of the former of these companies will give the main characteristics of the new commercial system: [Footnote: Charters Granted to the East India Company, 3-26,]

1. The charter, granted by Queen Elizabeth on December 31, 1600, was addressed by name to the earl of c.u.mberland and two hundred and fifteen knights and merchants, whom it created a corporation and a body politic under the name of "The Governor and Company of Merchants of London Trading to the East Indies."

2. The territory to which they were given privileges of trade consisted of all continents and islands lying between the Cape of Good Hope and the Straits of Magellan--that is to say, the east coast of Africa, the southern sh.o.r.e of Asia, the islands of the Indian Ocean, and the west coast of America; so long as they made no attempt to trade with any port at the time of the charter in the possession of any prince in league with Elizabeth, who should protest against such trade.

3. The corporation was for all time; but the privileges of trade under the charter were granted for fifteen years, with a promise, if they should seem profitable to the crown and the realm, to extend them for fifteen years more; and with a reservation, on the other hard, of the power to terminate them on two years' notice.

4. The powers of the company were those of an ordinary corporation and body politic. The members of the company and their employees possessed a complete monopoly of trade in the regions described, so far as English subjects were concerned, having, moreover, the right to grant licenses to non-members to trade within their limits.

5. They could buy land without limitation in amount, and as a matter of fact the company gained its first foothold in each of its stations in the East by buying a small piece of land from the native government.

6. The company could send out yearly "six good ships and six pinnaces with five hundred mariners, unless the royal navy goes forth," and these ships should not be seized even in times of special naval restraint, unless the queen's need was extreme and was announced to the company three months before the ships were impressed.

7. They had the right, in a.s.semblies of the company held in any part of the queen's dominions or outside of them, to make all reasonable laws for their government not in opposition to the laws of England, and they could punish by fine and imprisonment all offenders against these laws.

8. Nothing is said in the original charter of the powers of offence and defence, alliance and military organization; but these were probably taken for granted, as they were so generally used by merchants and navigators at the time, and were, as a matter of fact, exercised without limitation by the company from its first voyage.

9. Especial privileges and exemptions were granted to the company by freeing its members from the payment of customs for the first four voyages, by giving them from six to twelve months' postponement of the payment of subsequent import duties, and by allowing them re-export of Indian goods free from customs duties. The laws against the export of bullion were also suspended in their favor to the extent of allowing them to send out on each voyage 30,000 pounds in coin.

10. The organization of this company was comparatively simple, consisting of a governor, deputy governor, and twenty-four members of a directing board, "to be called committees," [Footnote: The word "committee" at that time was used for a single person, as in the case of "trustee," "nominee," "employee," and similar terms] all to be elected annually in a general a.s.sembly or court of the company. The governor and committees must all take the oath of allegiance to the English sovereign.

The East India Company remained for some years a somewhat variable body, as each voyage was made on the basis of a separate investment, by different stockholders, and in varying amounts. But in 1609 the charter was renewed, and in 1612 a longer joint-stock investment fixed the membership more definitely. By this time the company had become, in fact, as permitted by its charter, a closely organized corporation, with well-understood and clearly defined rights and powers, and it was soon started on its career of trade, settlement, conquest, and domination. [Footnote: Hunter, "Hist of British India," I, 270-305.] A new type of commercial organization had become clearly dominant.

CHAPTER VIII

TYPICAL AMERICAN COLONIZING COMPANIES (1600-1628)

An exactly typical chartered commercial company, which combined all the characteristics of such companies, of course did not exist. The countries with which they expected to trade ranged all the way from India to Canada; the political services which their governments imposed upon them varied from the production of tar, pitch, and turpentine to the weakening of naval rivals; while the personal qualities of the founders of the companies, and the sovereigns or ministers who gave the charters differed widely. Moreover, the later development of many of these companies had but little to do with the settlement of America.

Nevertheless, three companies may be chosen which exerted a deep influence on American colonization, and which, with the English East India Company described in the last chapter, are fairly typical of the general system. These are the English Virginia Company, the Dutch West India Company, and the French Company of New France.

The charter of 1606 granted to the London and Plymouth companies was of an incomplete and transitional character; [Footnote: H. L. Osgood, "The Colonial Corporation" (Political Science Quarterly, XL, 264-268). This charter is printed in St.i.th, Hist, of Virginia, App. I.; in Brown, Genesis of the United States, and elsewhere.] the second Virginia charter, [Footnote: Printed in full in St.i.th, Hist, of Virginia, App.

II., and, with a few omissions, in Brown, Genesis of the United States, I., 208-237.] however, which was granted at the request of the company, May 23, 1609, created a corporate trading and colonizing company closely a.n.a.logous to the East India Company, as will appear from the following a.n.a.lysis: 1. The company was chartered under the name, "The Treasurer and Company of Adventurers and Planters of the City of London for the First Colony in Virginia." It was fully incorporated, with a seal and all legal corporate powers and liabilities. In the charter itself were named some twenty-one peers, ninety-six knights, eighty-six of the lesser gentry, a large number of citizens, merchants, sea- captains, and others, and fifty-six of the London companies--in all, seven hundred and fifteen persons and organizations. They included a large proportion of the enlightenment, enterprise, and wealth of the capital, and, indeed, of all England. The grant was made to the company in perpetuity, although, as will be seen, some of its special exemptions and privileges were for a shorter term only.

2. The region to which the grant applied was the territory stretching four hundred miles along the coast, north and south from Chesapeake Bay, and "up into the land, from sea to sea westward and northward."

The possession of the soil was given to the company by the most complete t.i.tle known to the English law, but with the requirement that it be distributed by the company to those who should have contributed money, services, or their presence to the colony.

3. Its commercial powers extended to the exploitation of all the resources of the country, including mines, fisheries, and forests, as well as agricultural products; and to the requirement that all Englishmen not members of the company should pay a subsidy of five per cent, of the value of all goods brought into or taken out of the company's territory, and all foreigners ten per cent, of the value of the goojis. The company might send to Virginia all shipping, weapons, victuals, articles of trade, and other equipment that might be necessary, and also all such colonists as should be willing to go.

4. Powers of government in its territory were granted to the company with considerable completeness, the charter declaring that it might make all orders, laws, directions, and other provisions fit and necessary for the government of the colony, and that the governor and other officers might, "within the said precincts of Virginia or in the way by sea thither and from thence, have full and absolute power and authority to correct, punish, pardon, govern, and rule" all the inhabitants of the colony, in accordance with its laws already made.

As to offensive and defensive powers, it had the right to repel or expel by military force all persons attempting to force their way into its territories and all persons attempting any hurt or annoyance to the colony. The governor might exercise martial law in the colony, and was provided with the general military powers of a lord-lieutenant of one of the English counties. Thus the company and its colony were organized not exactly as an imperium in imperio, but at least as an outlying imperium.

5. As for special subsidies and privileges, the government of King James was scarcely in a position to make money contributions for such an enterprise, or to give to it ships such as the continental governments might give to their companies; but for seven years the company was allowed to take out all that was necessary for the support, equipment, and defence of its colonists, and for trade with the natives, free of all tax or duty; and for twenty years it should be free from customs on goods imported into Virginia, and should forever pay only five per cent import duty on goods brought from Virginia to England. Among privileges of less material value, but long after remembered for other reasons, the charter promised to the company that all the king's subjects whom it should take to inhabit the colony, with their children and their posterity, should have and enjoy all liberties, franchises, and immunities of free-born Englishmen and natural subjects of the king just as if they had remained or been born in England itself.

6. The duties to be performed by the company as respects the government were very few. In recognition of the socage tenure on which the land was held, a payment of one-tenth of all gold and silver was required; and the members of the council of the company were required to take an oath of allegiance to the king in the name of the company. The main requirement from the company was colonization. It was fully antic.i.p.ated, and in the preamble expressed, that the process of taking out settlers should be a continuous one; and a failure to transport colonists by the company's efforts would certainly have been a failure to fulfil the conditions of its charter.

7. Although there was no requirement of absolute conformity with the established church of England, yet on the ground of the desire to carry only true religion to the natives it was made the duty of the officials of the company to tender the oath of supremacy to every prospective colonist before he sailed, and thus to insure the Protestantism of the settlers.

8. The form of government of the company in England received much attention in the charter, as well it might, after the failure of the arrangements of the former charter. The membership, quarterly a.s.semblies of the general body of the members, more frequent meetings of a governing council of fifty-three officers, and their duties, were all minutely formulated; and the supremacy of this council, so consonant with the ideas of King James, and so opposed to the needs and the tendencies of the times, was carefully but, as it proved, unsuccessfully provided for. [Footnote: Osgood, "The Colonial Corporation" (Political Science Quarterly, XI., 369-273).] The charter of the Dutch West India Company was granted by "The High and Mighty Lords, the Lords States-General of the United Netherlands," June 3, 1621. It had already been under discussion in the various representative bodies of the Netherlands for fifteen years, and had been a fixed idea in the brain of its projector, William Usselinx, for at least fourteen years before that, [Footnote: Jameson, Usselinx, 21, 28, 70.] advocated in a dozen pamphlets and a hundred memorials and communications, written and oral, to the States-General; and it had the advantage of the state's experience with the Dutch East India Company.

The shape given to the West India Company in its charter was not, therefore, merely an outcome of the plans of an individual, but a resultant also of the influence of the earlier commercial companies, of the political conditions of the time, and of the ambitions, economic and political, of the influential merchant-rulers of the Netherlands.

[Footnote: Ibid, 2-4.]

1. The company was given for twenty-four years, during which no stockholders could withdraw and no new subscriptions would be received, the monopoly of the Dutch trade on the west coast of Africa, from Cape Verd to the Cape of Good Hope; in all the islands lying in the Atlantic Ocean; on the east coast of America from Newfoundland to the Straits of Magellan; and even beyond the straits on its west coast, and in the southern lands which at that time were still believed to stretch from Cape Horn across the South Pacific to New Guinea. All the non-European regions of the globe were thus divided by the States-General, with even greater boldness than by Pope Alexander, between the East and West India Dutch chartered companies.

2. Its commercial privileges included a general monopoly and extended to all forms of advancement of trade.

3. As to colonization, the charter provided that the company "may advance the peopling of fruitful and unsettled parts." Usselinx, the original author and the persistent advocate of the plan, would gladly have made more adequate provision for the establishment of colonies, the stimulation of agriculture and mining, good government in these colonies, their religious life, and the conversion of the natives. He had a picture in his mind of a great commercial dominion, settled from Holland and other countries, forming a market for European manufactures, and producing colonial goods for the use of the Netherlands. [Footnote: Jameson, Usselinx, 43.] But the charter was granted in war time, and by a body of aristocratic traders, who, as Bacon says, "look ever to the present gain"; so that the capture of Spanish plate-fleets and the sacking of West Indian settlements are contemplated with as much a.s.surance and interest as are colonization and more legitimate commerce.

4. In view of later disputes between England and her colonies, it is worthy of note that even such an enlightened advocate of a prosperous, self-governing colonial empire as Usselinx should have insisted, in 1618, that the colonists were to pay taxes to the home government, to trade with the Netherlands only, and to have no manufactures that would compete with those of the mother-country. [Footnote: Ibid., 63]

5. The political or semi-public powers of the company, according to the charter, were very extensive: it could form alliances and make war, so long as the war was defensive or retaliatory, could build forts, maintain troops, appoint officers, capture prizes, and arrest offenders on the high seas.

6. By way of subsidy the company was given one million florins, the use of sixteen government ships and four yachts, and exemption from all tolls and license dues on its ships.

7. The duties required of the company were an oath of fidelity to Prince Maurice, the stadtholder, and to the States-General, on the part of its officers; the provision of a number of vessels equal at least to those provided by the government; the return of its ships whenever practicable to the ports from which they had set out; the preservation for military purposes of all prizes captured from enemies of the States-General; the periodical publishing of accounts; and the division, after six years, of all surplus over ten per cent, in such a way that, in addition to what the shareholders received, one-tenth should go to the States-General and one-thirtieth to Count Maurice.

The government of the Dutch West India Company was very complicated, reflecting the political arrangements of the Netherlands and the jealousies of a merchant aristocracy distributed in provinces and cities. There was a governor-in-chief of the company's colonial possessions, but his powers were dependent on a general board of nineteen directors, who were the supreme authority in the regulation of the company's affairs. Below this central body were five territorial chambers, with a combined membership of seventy-eight. The numbers, powers, and influence on the policy of the company of these chambers were in proportion to the wealth of the cities they represented and to the amount of the stock subscribed from these cities. The Amsterdam chamber, which was to subscribe one-half the capital stock, was far the most influential and had the largest number of directors; after it in order came the chambers of Zealand, of the cities on the Meuse, of the cities of North Holland, and of the cities of Friesland and Groningen.

These local boards elected the general board, one-third of their number, chosen by lot, retiring each year. [Footnote: Jameson, Usselinx, 33, 34.]

When Richelieu became prime-minister of France in 1624, one of the earliest definite lines of policy he initiated was the formation of privileged commercial companies. [Footnote: Edict of Reformation of 1627, art. 429; Isambert, Recueil General des Anciennes Lois Francaises, XVI., 329.] He saw with great clearness and formulated in a state paper [Footnote: Michaud et Poujoulat, Memoires, I., chap, xviii., 438.] the reasons for recognizing the superiority for distant commerce, under the conditions of that period, of chartered companies over individual traders. He was also much impressed with the power and success of the great East India companies of England and Holland. His first plan was a general French company of commerce, to include all the outlying sections of the world, and at least two such companies were chartered in succession. They came to nothing, and soon gave place to companies authorized each to carry on commerce with a specified part of America, Africa, Europe, or Asia.[Footnote: Pigeonneau, Hist. du Commerce, II., 426-431.] The most important of these was the company of Canada, chartered in 1628 on the plans of Champlain, and intended to take the place of all earlier companies and individual grantees having privileges in that region. The chartered powers and privileges of this company may be a.n.a.lyzed as follows:

1. The region to which they extended was "the fort and settlement of Quebec, with all the country of New France, called Canada." [Footnote: Isambert, Recueil General, XVI., 216-222.] It was described as extending along the Atlantic coast from Florida to the arctic circle, and from Newfoundland westward to the sources of the farthest rivers which fell into the St. Lawrence or the "Fresh Sea."

2. The power of the company over the soil was complete. It was allowed to sell or dispose of it in such portions and on such terms as it should see fit, except that if it should grant great fiefs such as duchies or baronies, letters of confirmation to the grantees should be sought from the crown.

3. The continuance of the company in its full form with all powers and duties was to be for fifteen years, while for other purposes its life was to be perpetual.

4. Its commercial privileges extended during this term of fifteen years to the complete monopoly of all kinds of commerce by sea or land, all former grants being withdrawn; and the company was empowered to confiscate any French or other vessels coming to trade within its dominions. The value of Canada as a source of supply for furs was already known, and the fur trade was placed under the special control of the company forever. The whale and seal fisheries, on the other hand, were exempted from its control, even for the fifteen years, and left free to all Frenchmen.