On the Sink of Specie

in univerCity

I am putting together a reading list for next term, and thought it might be fun (under this whole rejuvenated CM lately) to post some more primary source reading. Below is an editorial from NYT. It is quite a remarkable document for a number of reasons, not least that it was written in NY- the notion of imperialism, the defense of British civilizational mission, capital, religious righteousness: it is all here. Rinse. Repeat.

– “Progress of Events in British India“, New York Times, Oct 24, 1857

Progress of Events in British India.

The not improbable rumor of the recall of Viscount Canning from the Viceroyality of India, is but one of many indications that the Government of England is now fully alive to the importance of the struggle in India, and fully determined to put forth the whole force of the empire in the suppression of the Mohammedan mutiny. For although Lord Canning has exhibited qualities not unworthy of his name in the trying crisis through which he has been called to pass, it has been reported, on credible authority, that he had brought or suffered himself to be brought into collision with Sir Colin Campbell on questions of policy. That, in such an emergency, the civil official should be sacrificed to the military, proves how clearly the government of Lord Palmerston appreciated the natures and severity of the ordeal through which British authority in India is passing. The maxim of Malcolm rules and must rule the hour. India was won by the sword, and must be kept by the sword.

As we have constantly maintained since the outbreak of the disturbances at Meerut, so we now repeat – England is contending with a mutinous army, and with a mutinous army only, and if she be not utterly recreant to all the traditions of her national history, it is impossible that she should not come out of the contest victorious over all her enemies, whether in one, in two, or in all the Presidencies of India. Blundering imbecillity may hereafter aggravate, as it has already aggravated the difficulties of the task; but it must and will be achieved. As Damies said of that dreadful day of doom which was to witness his own death by torturers, which are the eternal disgrace of the French monarcy, “La journ√©e sera dure, main elle finira“; so may it be said of the trial which awaits Great Britain in the East – the day may be long, but it must come to an end – and it is irrational to expect that end anything but the re√ęstablishment of British authority upon a basis of broader justice to India and England alike, and under the conditions of a sounder policy than has ever ruled the relations of these countries in the past.

For it is an immense, though a very common mistake, to suppose that the Indian Empire of England has in times past been of essential importance to the prosperity of the metropolis. It is for the prospective, rather than for the actual value of her imperial sway over the Hindoo millions, that England is now contending. It is in the cause of the world’s commerce yet to be, as well as of teh interests of Chrisitanity, and of civilization, that the bayonets of the “gallant Tipperary,” and the broadswords of the Highlanders, are making sharp for the battle in Bengal and in Oude.

From the very first, India has been a mirage of magnificence to England. When the factories of the Hoogly grew into a fortress, and the garrison of Fort William expanded into an army, and the English merchants in the East suddenly came before their countrymen with an empire in their hands, a policy was inaugerated in regard to India which was founded on false representations, and has resulted in perpetual deceptions. England had regarded her West Indian and her American colonies simply as markets for her goods. Her sons in the West were dear to her only as her customers. But India was to pour into her lap untold millions of wealth, the creation of looms which had supplied the Pharoahs with purple and fine linen, and the produce of the mines whose fabled splendor had turned the brains of an Alexander and of a Caesar.

When after the conquest of Bengal, Behar and Orissa by Lord Clive, the East India Company applied for a charter befiting their new estate of a great territorial power, they engaged to pay into the English Treasury in three years time, the sum of $2,000,000. This was in 1767. In 1769 the period was prolonged by four years. In 1793 the obligation falling due was met by a demand from the Company, of a loan of $7,000,000! This was granted on the condition of their reducing their dividends from 10 to 6 per cent. In 1798, Mr. Fox, in introducing his famous India Bill, declared the Company insolvent, with debts of over $50,000,000 and assests of $16,000,000! Mr. Fox’s bill was defeated, and the Board of Control created. But this did not mend matters. In 1793 Lord Cornwallis had “extended again the area of civilization”. His conquests swelled the revenues of the Company to over $40,000,000 and Mr. Dundas, representing their interests, promised all manner of splendid things for the future. In the course of a very few years India was to put $28,000,000 per annum wholly at the disposition of Parliament for the use of the nation, independently of all the other goods she was to yield to the Empire. In 1795 that curse of companies, the “floating debt,” mysteriously began to incease, and in 1799 Mr. Dundas instead of giving away two millions and a half was compelled to own a deficit of nearly six millions. The victories of Lord Wellesley’s belligerent administration were followed by similar results. In 1805 the Indian Budget revealed a revenue of over $75,000,000 against an expenditure of about $85,000,000.

Meanwhile the natural currents of commerce having been choked, India was of but little use to England as a customer. Up to 1815 the exports to India were less important than the trade with the Channel Islands.

The revised charters of the Company have produced a decided improvement in all respects during the last thirty years, and the general prosperity of India, which has undoubtedly advanced under British rule, has brought with it a corresponding change for the better in the fiscal as well as in the commercial relations of England with India. But, as we observed the other day, any serious prolongation of the disturbances in Bengal and Oude will bring the Indian Treasury empty-handed into London – and the Indian loan of a million sterling, reported by the Niagara a week ago, prefigures the possible arrival of this crisis at an earlier hour than we had anticipated.

The commerce of England with India, however, could not be carried on for any great number of years with advantage to England, under its past conditions. A few facts will suffice to make this very plain. From 1831-5 to 1841-2 the total exports from India, inclusive of bullion, rose from £9,674,728 to £16,020,837. During the same time the imports into India, inclusive of bullion, rose from £7,654,485 to £11,473,110. That is, the balance of trade in favor of India rose during the eight years 125.10 per cent. From 1849-50 to 1853-4 a still greater proportional increase in favor of India was manifested, the actual balance remaining unpaid in favor of India at the end of these five years, amounting to £20,828,923. And during the past century it is estimated that India has absorbed and never restored any appreciable portion of $500,000,000 in silver and gold. Modern India, in fact, has up to this time continued to be what ancient India was described to be by Pliny, “the sink of the precious metals”. In the existing state of the commerce and manufacturers of mankind, this character of the Indian trade is a vitally disorganizing and disturbing element.

If India were to be released by England, then it is clear that the world at large would be simply the loser by so much more gold and silver as would be poured into India in consequence of the diminution and decay of the gradually-growing demand for foreign goods which the rule of English civilization alone has created and fostered. And the commercial interests, as well as the religious and moral convictions of Christendom, are therefore quite as deeply involved as are any imaginary necessities of Great Britain in particular, in the triumph of her armies over the disloyal and fanatical hordes of their enemies. Mohammedan India becomes a second China, controlling, however, the supply of staples much more essential to modern commerce than the silks and teas of the Celestial Empire. British India promises to become a regular and legitimate member of the family of nations. Annihilate the rule of England in India at this hour, and save in Eastern elements of national prestige, the British Empire would be to no positively appreciable extent a serious loser in power or in wealth. Reinforce British authority firmly in India, and the millions of Hindostan, multiplying their wants with their numbers under the wholesome influences of civilization, will eventually cease to be the “sink of specie” and enter the markets of the world as buyers, on terms of equality with the rest of mankind.

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