Edmund Burke (1729-1797), the great political rhetorician and British statesman, understood the civilization that British colonial America had become.
In 1769, three years into what would be a 28-year stint as a member of the House of Commons, Burke published a pamphlet in which he noted: “The pride and strength of the Americans is their trade. A perfectly unimpeded commerce seems to them inseparable from liberty.”
Six years later, Burke attempted to persuade his fellow MPs to do whatever was necessary to placate the American colonists and avoid war. His unsuccessful but now famous “Speech on Conciliation with America,” delivered on March 22, 1775, contained this:
“America – which at this day serves for little more than to amuse you with savage men and uncouth manners; yet shall before you taste of death, show itself equal to the whole of that commerce which now attracts the envy of the world. Whatever England has been growing to …in a series of Seventeen Hundred years, you shall see as much added to her by America in the course of a single life.”
Burke recognized that a zeal for enterprise and commerce was fundamental to who colonial Americans were and what their America was about.
It may seem surprising that what an Irish-born British statesman identified as fundamental to British colonial America is just as fundamental to the United States today. Surprising, that is, until we recall that by July 4, 1776, the market-based American economy had been growing, developing and spreading for 169 years.
British colonial America was capitalist from the get-go. It did not develop according to a plan. It developed according to the profit motive.
The idea of establishing colonies in America came not from the British crown or the British Parliament, but from profit-seeking British entrepreneurs and investors. Joint-stock companies established the first and the bulk of the British colonies in America.
A joint-stock company was a form of business partnership. It required a royal charter, but the partners financed the venture and assumed all risk.
Jamestown was a business venture of the Virginia Company of London. Plymouth, of Pilgrim fame, was a venture launched by a group of 70 investors led by Thomas Weston. Massachusetts Bay was launched by the Massachusetts Bay Company.
Colonists were wired into producing for the market from the outset. Profits to the joint stock companies, and to the colonists themselves, came from the sale of commodities produced by the colonists to buyers in Britain and elsewhere. Which commodities would be most profitable was left to the colonists – and the market – to determine.
British commercial law was employed immediately, though with some modifications. Land tenure law was a crucial modification. The British Crown allowed only one type of land tenure in colonial America: free and common socage. Meaning: land purchased from the Crown is owned free and clear.
Colonial Americans made enterprising use of the arrangement. They scattered and settled wherever they found productive land. They also bought and sold land as a speculative investment. Land speculation was a leading industry in the colonies almost from their beginning.
The growth and development of British colonial America had an ironic consequence. The joint stock companies established colonies in America to produce commodities for export. Yet, in short order, most colonists found the domestic market more lucrative than the export market. Economic historians estimate that, in the 169 years from Jamestown to 1776, less than five percent of colonial American output was exported.
The British colonial America that Edmund Burke wrote and spoke of was a well-established capitalist civilization. On July 4, 1776, that well-established capitalist civilization became a country.
Reg Murphy Center