Dec 6, 2011
Americans with Attitudes: Smuggling in Colonial America
Smith explores America’s proud history of smuggling in the colonies—and the disastrous attempts by the British to put an end to it.
Since the seventeenth century American commerce had been regulated by a complex system of British laws. The basic idea behind this “mercantile system,” as Adam Smith called it—or “mercantilism,” as it was later called—was fairly simple. The colonies were to produce raw materials, many of which could be shipped only to Britain, and Britain, in turn, would produce finished products to sell to the colonies.
During the 1720s and 1730s, while Robert Walpole was the English Prime Minister, many of the trade laws were loosely enforced, if at all. Walpole’s motto, “Let sleeping dogs lie,” was reflected in his attitude toward the American colonies. A free-trader at heart, Walpole allowed the Board of Trade, the enforcement arm of mercantilism, to languish. And to the important position of Secretary of State for the Southern Department, Walpole appointed the like-minded Thomas Pelham, Duke of Newcastle.
The Duke of Newcastle was responsible for American affairs. More interested in the patronage of his office than in enforcing commercial regulations, Newcastle pursued a policy which the Irish statesman Edmund Burke later called “salutary neglect.” That is to say, Newcastle pretty much left the colonies alone, allowing customs officials to take bribes in exchange for looking the other way. In the view of Burke and other proponents of free trade, this neglect—or “corruption,” as some called it—allowed both Americans and Britons to prosper. It was said that Newcastle had a closet-full of unopened dispatches from colonial governors who were complaining about American lawlessness.
As a result of salutary neglect, smuggling was rampant in the colonies, and most Americans saw nothing wrong with it. They did not look kindly on government interference with their commercial activities. They agreed with Thomas Jefferson that free trade is a “natural right.”
For example, in 1756 and 1757, some 400 chests of tea were imported into Philadelphia, but only sixteen were imported legally. Indeed, three-quarters or more of the tea consumed by Americans was illegal. In 1763, the British government estimated the value of commodities smuggled into the colonies at 700,000 pounds annually, an enormous sum at that time.
The preference for inexpensive tea was not peculiar to Americans. Over half the tea consumed in England was smuggled, and English smugglers, like their American counterparts, could get quite indignant when their free-trade activities were interrupted by government. Consider this reaction of an English smuggler when his vessel was boarded and his men arrested by Captain Bursack of the Speedwell, a British revenue cutter. The captain of the smugglers was not aboard when this happened, but he made his feelings known in a letter to Captain Bursack:
Sir: Damn thee and God damn thy two purblind eyes thou bugger, thou death-looking son of a bitch. O, that I had been there (with my company) for thy sake when thou tookest them men of mine on board the Speedwell cutter on Monday, the 14th of December. I would drove thee and thy gang to Hell where thou belongest, thou Devil incarnet. Go down, thou Hell Hound, unto they kennel below and bathe thyself in that sulphurous lake that has been so long prepared for such as thee, for it is time the world was rid of such a monster. Thou art no man but a devil, thou fiend. O Lucifer, I hope thou will soon fall into Hell like a star from the sky, there to lie unpitied and unrelented of any for ever and ever, which God grant of his infinite mercy. Amen.
The period of salutary neglect came to end during the Seven Years’ War (1756-63)—known in America as the French and Indian War—when many American merchants engaged in trade with the French. Trading with the enemies of Britain during wartime was something of a tradition among the colonials. During an earlier war, for instance, American merchants used neutral ports in the Caribbean to exchange their provisions for French molasses, while bribing customs officers to obtain false clearance papers.
One method of trading with the enemy was especially popular in Rhode Island, the smuggling capital of America. Flags of truce were used to exchange prisoners, and merchants found that these could be purchased at reasonable prices from colonial governors. Then, after hiring some men who spoke French to pose as prisoners, and sailing under flags of truce, American merchants traded with the French West Indies. In 1748, an American wrote to a correspondent in Amsterdam:
The sweets of the French trade by way of flags of truce has put me upon turning my navigation that way, which is the most profitable business I know of. But, my friend, of this you must not lisp a word.
This illegal trade continued during the Seven Years’ War, especially during its later phase when inhabitants of the French West Indies were desperate for food. Merchants from Newport, Boston, New York, Philadelphia, and other ports carried foodstuffs to the enemy for handsome profits.
Pennsylvania’s wartime governor, William Denny, conducted a brisk trade in flags of truce. He sold so many that by 1759 the flags were traded openly on the New York market.
This wartime commerce with the enemy infuriated British military commanders, but it was difficult to stop. Smugglers were typically acquitted by sympathetic American juries, and informing on a smuggler could prove dangerous. When a New Yorker wrote an article that implicated two justices of New York’s Supreme Court in the nefarious traffic, newspapers refused to print it. Then the informer was hauled in a cart through the streets, pelted with filth, and thrown in jail.
Americans continued their smuggling ways after the close of the Seven Years’ War in 1763. An English writer commented on the widespread violation of trade laws:
It was a matter of astonishment to observe what little care was taken to enforce the laws. The breaches openly committed against the Acts of Trade, and the shameful prostitution of office which prevailed in most of the ports on the Continent, could not escape the notice of the most superficial observer. The merchants had commonly undertaken these voyages which afforded the greatest prospect of gain, without any further regard to their illegality than that the Custom House must be silenced, by what means was but too obvious.
The loyalist Peter Oliver, former Chief Justice of the Superior Court of Massachusetts, recalled with horror how religious and upstanding merchants smuggled with a clear conscience. One prominent merchant, after sailing his ship full of contraband into Boston Harbor, would appear at the customhouse before it opened in the morning. He would raise a hand and swear that anything else he swore that day would be untrue. Then, after the customhouse opened for business, this merchant would swear before an officer that his contraband-laden ship contained no contraband.
Oliver related how another merchant solved the problem of swearing under oath that he was not smuggling:
Another Captain boasted, that he had evaded the law, by writing two manifests of his cargo, one of which contained the contraband goods he had on board, and in the other manifest those goods were left out. He then went to the customhouse and stuck the true manifest in the sleeve of that hand which he was to hold up in swearing, and delivered the false manifest to the Officer, and swore the manifest to be a true one, meaning that which was in his sleeve.
In 1763, Prime Minister George Grenville cracked down on bribery and illicit trade. Eight warships and twelve armed sloops were sent to patrol American waters and pull in smugglers. Previously, many customs officers had remained in England while sending low-paid underlings to America to do the dirty work. Grenville ordered these officers to take up their posts in America or resign. They would be fired immediately if they neglected their duties.
Grenville was just getting started. Customs duties had been designed to regulate the flow of trade, not to raise revenue. Indeed, the trade laws cost four times more to enforce than they brought in, so Grenville set to work on a long list of proposals to raise revenue and curtail smuggling. In 1764, Parliament enacted these proposals, commonly called the Sugar Act, into law.
Six sections of the Sugar Act dealt with new taxes, and over forty additional sections were devoted to far-reaching changes in commercial regulations, including rigorous methods of enforcement. These regulations were a bureaucratic nightmare that greatly increased the cost of doing business and, in some cases, made compliance for merchants engaged in intercolonial trade nearly impossible. Any small vessel engaged in inland trade would probably be guilty of some violation or other, even when there was no criminal intent. This left the door open for racketeering by customs officers who lined their pockets by seizing vessels for technical violations.
The Sugar Act facilitated this abuse by implementing new guidelines for prosecuting accused smugglers. The owner of a seized vessel had to pay the cost of his trial in advance or forfeit everything. Even if he was exonerated, the owner could not recover these court costs. Nor could he sue a customs officer, so long as the judge certified that the seizure had been made with probable cause. To make matters worse, the government did not have to present evidence of fraud. The owner was presumed guilty and had to prove his innocence.
Armed with these legal weapons, some customs officers declared open season on American commerce. Such was the case with the rapacious Daniel Moore, Collector of Customs for Charleston. Moore harassed small merchants in South Carolina ports. When some merchants sued Moore and won, he vowed revenge, declaring that he would “sweat the merchants at law with their own money.”
Moore was as good as his word. He seized a small vessel, the Active, and dragged its owner into a vice-admiralty court, which operated without a jury. The owner of the Active was cleared of all charges; but Moore, according to the judge, had seized the vessel with probable cause, so the owner was assessed court costs in the amount of 150 pounds—nearly double the value of the vessel itself. This is what Moore meant by sweating merchants at law with their own money.
Even rigorous enforcement of the Sugar Act could not always shield customs officers from the wrath of irate Americans. This was especially true in Rhode Island where, unlike most other colonies, the governor was elected by popular vote, not appointed by the Crown. Moreover, when a customs officer caught a smuggler red-handed he had to face a judge and prosecuting attorney who were native Rhode-Islanders—men sympathetic to the cause of free trade. The judge might call a trial on short notice when he knew the customs officer was far away and unable to testify, thereby resulting in a dismissal for lack of evidence. Or if a judge had no choice but to convict a smuggler and confiscate his ship, he might later sell the vessel back to the smuggler for a fraction of its true value. But the simplest way to keep the wheels of commerce turning was to grease the eagerly outstretched palms of customs officers.
As these and many similar examples illustrate, Americans who had grown accustomed to decades of “salutary neglect” deeply resented the post-war efforts of the British government to impose taxes—especially when those taxes were raised for the express purpose of maintaining 10,000 British troops in the colonies. As much as historians delight in tracing the influence of political philosophers, such as John Locke, on American thinking, there can be little doubt that no sophisticated ideological foundation was needed to motivate many Americans to evade British laws and even to resist their enforcement with violence.
So why did so many average Americans eventually leave their homes to fight against the British? One perspective was given by Captain Preston, an American who had fought the British at Concord on April 19, 1775. In 1842, this ninety-one-year-old veteran was interviewed by a twenty-one-year-old reporter. The young reporter apparently expected to hear stories of unjust taxes and oppression, and of revolutionaries schooled in theories of liberty. What he got was far different, and more to the point:
Reporter: “Captain Preston, did you take up arms against intolerable oppressions?”
Preston: “Oppression? I didn’t feel them.”
R: “What, were you not oppressed by the Stamp Act?”
P: “I never saw one of those stamps. I certainly never paid a penny for one of them.”
R: “Well, what then about the tea tax?”
P: “I never drank a drop of the stuff; the boys threw it all overboard.”
R: “Then I suppose you had been reading Harrington or Sidney or Locke about the eternal principles of liberty?”
P: “Never heard of ‘em. We read only the Bible, the Catechism, Watts’ Psalms, and the Almanac.”
R: “Well, then, what was the matter? And what did you mean in going to this fight?”
P: “Young man, what we meant in going for those redcoats was this: We always had governed ourselves, and we always meant to. They didn’t mean we should.”