Volatility

March 1, 2011

The Real Tea Party

 

The British East India Company was one of the earliest corporations and quickly became by far the most powerful of its age. In its heyday it was more powerful than most of the world’s governments. It already embodied most of the worst aspects of corporate existence, and its depredations in America ended up providing the final impetus to colonial independence. The American Revolution sought independence not just from British economic and political tyranny in general, but from the British-based corporation in particular.
 
The BEIC was chartered by Queen Elizabeth in 1600 and first issued permanent stock in 1613. One of the first instances of an award of limited liability for investors was a special Act of Parliament in 1662 bestowing this privilege upon BEIC shareholders. This Act isn’t surprising when we consider that often up to a third of Parliament were shareholders, and Kings often received loans from “the Company”, as it was usually called. Up to 10% of government revenue was from the tax on the BEIC’s tea monopoly.
 
The BEIC was one of the earliest joint-stock companies, pooling the capital of investors, which was better for the high-risk, high-reward nature of expeditions to places like Russia, Turkey, Africa, and China. The Company was also involved in piracy as well as the legalized chartered piracy called privateering, a common corporate prerogative to this day.
 
The license to privateer was one of many aspects of the monopoly charter, which originally meant an exclusive charter to extract a particular rent. Monopoly would later extend to doing business in a particular region. Corporate chartering never completely lost this feudal nature, and today the monopoly aspect is again waxing, as is the corporation’s old license to amass private armies, police, prisons, and conduct its own foreign policy. The BEIC and other early corporations did all these as well.
 
The Company’s original charter granted it a monopoly on all trade east of the Cape of Good Hope. Driven out of the actual East Indies by the Dutch, the BEIC ended up imposing a horrendous plunder regime upon India, depopulating whole countrysides by bleeding them of all economic ability to sustain life. Eventually the Company’s trade revenue was greatly exceeded by its rent extractions – company taxes, forced markets, prohibitions on all local industry and trading – all pure robbery.
 
By the early 1770s, the Company was on the verge of bankruptcy and needed a bailout. In the 1760s the shareholders kept voting increases in their annual dividends even as revenues were tightening. A Company-caused famine in 1769-70 greatly decreased the amount of plunder the Company tax collectors could extract. Meanwhile the BEIC was also losing share in the lucrative American market to Dutch smugglers.
 
In 1772, the Company took another severe hit as Europe fell into depression and continental tea sales plunged. It now had a tea glut in its warehouses. In collaboration with Parliament, the Company decided the solution was to dump the tea in America. This would relieve the supply glut and undercut the Dutch. Parliament agreed to suspend British-end duties in order to facilitate the scheme. It was classic globalization. But in a typical example of schizophrenic British policy throughout its confrontation with the colonies, the ministry insisted on the duty being collected at the colonial end. So the colonists would still have to pay the tax, even though the Company didn’t have to pay it in Britain. This helped revive the lately moribund taxation-without-representation agitation.
 
Far more potent than the tax issue, however, was the monopoly provision the Company added. Only its own special commissioners would be empowered to warehouse and retail the tea in the colonies. In Boston and throughout the colonies, most businesses were family-owned or partnerships. Corporations were unnecessary and unwanted. Under the mercantile policy and the Navigation Acts based upon it, these colonial businesses were already in a constrained position. Colonials were largely forbidden to engage in even local manufacturing let alone manufacturing for export. Their use of native resources was also subject to restraint contingent on the needs or whims of British mercantile entities like the Navy (who for example had dibs on all white pine trees according to the White Pine Act) or the BEIC.
 
Now these colonial businessmen saw themselves further threatened by the Company monopoly plan. It was a direct attack on their tea warehousing and retailing. Worse than this, all saw it as the prototype for all sorts of future British-imposed corporate monopolies. So not only were they foreclosed from manufacturing, but they’d be driven out of commerce as well. We can compare this to today’s prototypes, examples like the FDA’s milk “definitions” and the health racket Stamp mandate. Together these constitute such a prototype.
 
Broadsides of the time make clear how this was seen immediately as an early version of Walmartization:
 

To the Tradesmen,
Mechanics, &c. of the
Province of Pennsylvania

… Hereafter, if they succeed, they will send their own Factors and Creatures, establish Houses amongst us. Ship us all other East-India goods; and in order to full freight their Ships, take in other kind of Goods at under Freight, or (more probably) ship them on their own Accounts to their own Factors, and undersell our Merchants, till they monopolize the whole Trade. Thus our Merchants are ruined, Ship Building ceases. They will then sell Goods at any exorbitant price. Our Artificers will be unemployed, and every Tradesman will groan under the dire Oppression.

The East India Company, if once they get Footing in this (once) happy country, will leave no Stone unturned to become your Masters. They are an opulent Body, and Money or Credit is not wanting amongst them They have a designing, depraved, and despotic Ministry to assist and support them. They themselves are well versed In Tyranny, Plunder, Oppression and Bloodshed. Whole Provinces labouring under the Distresses of Oppression, Slavery, Famine, and the Sword, are familiar to them. Thus they have enriched themselves,thus they are become the most powerful Trading Company in the Universe. …

excerpts from a broadside signed “A Mechanic,” Philadelphia, December 4, 1773

 
As if wanting to maximize the fear and anger, Massachusetts royal governor Thomas Hutchinson wrangled appointments for his two sons, a son-in-law, and two cronies as the five Boston consignees for the BEIC tea. Hutchinson had long been reviled for among other things his decades-standing cronyist agenda, and the way he systematically sought to enshrine his family as de facto feudal nobles. The tea commissioner appointments comprised the ultimate proof of a nefarious plot between the Company, the ministry, and Hutchinson to economically enslave Massachusetts.
 
This was the cause of the Boston Tea Party of December 16, 1773. A shock troop of around 150 men assembled at the home of rebel printer Benjamin Edes where they were painted and costumed to look like Indians. Joined by hundreds more in regular dress, shouting “the Mohawks are come!” and “Boston Harbor a teapot tonight!”, they boarded the three tea ships docked in Boston Harbor and destroyed the tea. There was little in the way of political symbolism about it – they wanted to maximize the economic destruction. 120,000 pounds, sixty tons, around 10% of a year’s worth of colonial consumption, 50% of normal imports from Britain, went into the harbor. The tea filled the water and piled up against the sides of the ships, until shovels were needed to keep the piles from tipping back over onto the decks. One man caught trying to secret tea in his pockets was roughed up while his coat was stripped. After the job was done the Mohawk leader, Captain Pitts, had everyone take off their shoes and shake them out, just to make sure no one was inadvertently taking home some tea he might be tempted to sell later. All the details had been carefully prepared. Every cup’s worth of tea was to be destroyed.
 
The non-corporatized merchants saw doom, so they acted. They destroyed the economically weaponized corporate property. The colonists were economically rebelling against colonialism in general and corporatism in particular, exactly the fight we face today. The rejection of corporate monopoly and the destruction of corporate property lay at the core of the American Revolutionary ideal. And when the British responded to the Tea Party by closing Boston Harbor and the other Intolerable Acts, the colonies didn’t cave in, but responded with galvanization, support, resolve. The American Revolution now definitively moved beyond its stage where most still hoped for some “reformist” solution, to the stage where Independence had become inevitable, even if most didn’t fully realize that at first.
 
Today anyone who still thinks and feels and acts in the spirit of the Boston Tea Party is an anti-corporate activist. The Tea Party was a direct counterattack on the British East India Company and the BEI/Parliament nexus, which is the same corporate/government nexus which afflicts us today. So a true tea partier is ready to whoop it up again against the tyrannical corporations. History is the authority for this fact.
 
And today we need such Mohawks. To give one example, for years freedom-loving people from India to Italy have repeatedly taken action to fight back and destroy the GMO fields which threaten their economic and political freedom, as well as the biosphere itself. And can we rely on the rule of law to solve such problems? On the contrary, as we speak the US government is brazenly defying a court order against allowing Monsanto’s GE sugar beets to be planted without even the normal sham environmental assessments. And we just saw the administration’s psychopathic approval of GE alfalfa, a policy guaranteed to contaminate all alfalfa, bringing us that much closer to the inevitable system collapse and world famine GMOs promise to someday trigger.
 
The same Indians who were once “bled white” by the British East India Company are now driven to suicide in the hundreds of thousands by corporations like Monsanto, by the US government, and by totalitarian globalization entities who are the lackeys of these chartered monopolies. Then there’s the likes of the NYT which continues to viciously, wantonly demand the further escalation of this global war on the people of America and the world.
 
My purpose in writing this is not necessarily to call for actual property destruction. People will have to consult their conscience and necessity to discern the right tactic for any situation. But I want to make clear how the struggle of the American Revolution was the same struggle we endure today. It was the same struggle against corporations, against monopoly charters, corporate rent extractions, corporate forced markets, the forced restraints of colonial economic policy, the same internal mercantilism we increasingly face today, against the same globalization and internal economic colonization within an empire (consider how truly alien and destructive Walmart and its clones are to our communities).
 
We see how corporatism is a radically regressive deterioration of our political and economic freedom and power. It’s part of the descent back to feudalism the kleptocracy has planned for us. We see how our only hope for preserving our freedom and regaining our prosperity is to continue on the original path of the American Revolution. This is the path of the true Boston Tea Party. It’s the path of total rejection of corporations and the corporate/government nexus, withdrawal from the grasp of their parasitic extractions, and total resistance to their assaults. This is the only road to freedom and self-determination. It’s the only road forward for humanity.

3 Comments

  1. The bailout of the BEIC is an interesting fact.

    I’ve discovered English bank bailouts in the 1870s. The banks had not reserved enough, and when the U.S. railroad bubble burst, they would have failed, so they got bailed out. And that was with the gold standard.

    While bailouts don’t seem to happen in idealized capitalism, they seem to be a feature of real capitalism, and they have been for a century.

    Comment by Tao Jonesing — March 1, 2011 @ 12:02 pm

    • That’s real capitalism all right. For a little while there I was making a point of arguing that at Naked Cap when I saw someone going on about how “this isn’t real capitalism!”

      I’d say: Capitalism has been in the deployment stage for long enough and universally enough that whatever it’s always been in practice, that’s what it really is and will always be. It’s the textbook stuff which is utopian pipe-dreaming. (Another example of how those who idealize “free markets” and such are the real dreamers, far more than any anarchist, for example.)

      More recently I haven’t been bothering.

      Aren’t those British bailouts the ones that supposedly were carried out according to Bagehot’s rules – lend only to solvent banks at punitive rates on good collateral?

      (I have no idea if that’s the way it really was in the 1870s.)

      I have that memorized because of how often I used to see that compared to the US government bailout: Bail out insolvent banks at far-below-market rates on crap collateral or no collateral at all.

      Comment by Russ — March 1, 2011 @ 2:07 pm

  2. [...] [...]

    Pingback by Corporations Are Anti-Democratic « Volatility — March 11, 2011 @ 9:11 am


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