● Subsequent laws required that European goods destined for America first had to be landed in Britain, where tariff duties could be collected and British middlemen could take a slice of the profits. ● Other laws stipulated that American merchants must ship certain “enumerated” products, notably tobacco, exclusively to Britain, even though prices might be better elsewhere. ● British policy also inflicted a currency shortage on the colonies. ● Since the colonists regularly bought more from Britain than they sold there, the difference had to be made up in hard cash. ● Every year gold and silver coins, mostly earned in illicit trade with the Spanish and French West Indies, drained out of the colonies, creating an acute money shortage. ● To facilitate everyday purchases, the colonists resorted to butter, nails, pitch, and feathers for purposes of exchange. ● Currency issues came to a boil when dire financial need forced many of the colonies to issue paper money, which swiftly depreciated. ● British merchants and creditors squawked so loudly that Parliament prohibited the colonial legislatures from printing paper currency and from passing indulgent bankruptcy laws—practices that might harm British merchants. ● The Americans grumbled that their welfare was being sacrificed for the well-being of British commercial interests. ● The British crown also reserved the right to nullify any legislation passed by the colonial assemblies if such laws worked mischief with the mercantilist system. ○ the colonists fiercely resented its very existence The Merits and Menace of Mercantilism ● In theory the British mercantile system seemed thoroughly selfish and deliberately oppressive. ● But the truth is that until 1763, the various Navigation Laws imposed no intolerable burden, mainly because they were only loosely enforced. ● Enterprising colonial merchants learned early to disregard or evade troublesome restrictions. ● Some of the first American fortunes, like that of John Hancock, were amassed by wholesale smuggling. ● Americans also reaped direct benefits from the mercantile system. If the colonies existed for the benefit of the mother country, it was hardly less true that Britain existed for the benefit of the colonies.
● London paid liberal bounties to colonial producers of ship parts, over the protests of British competitors. ● Virginia tobacco planters enjoyed a monopoly in the British market, snuffing out the tiny British tobacco industry. ● The colonists also benefited from the protection of the world’s mightiest navy and a strong, seasoned army of redcoats—all without a penny of cost. ● But even when painted in its rosiest colors, the mercantile system burdened the colonists with annoying liabilities. ● Mercantilism stifled economic initiative and imposed a rankling dependency on British agents and creditors.
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