Follow the Money: Formation of An Elite Faction–Brenner’s ‘New Men’ & Virginia’s Contribution to the Evolution of English Modern Capitalism
Policy-making cannot separate itself from the question, “Who Governs”. There are many approaches that are used to classify and label the different groups of elites (those who actually make the decisions), those that attempt to influence the elite decision-makers, and the larger “mass” of citizens, residents or people who lie for the most part outside of the making of a policy decision or are directly involved in its implementation.
With reflection one realizes that this framework does little to help us understand how a policy system and “who governs” it is set up from scratch. To make matter hopelessly complex, we shall discover, Virginia did not follow “the rules” of how to set up a new system in 1625 when it took over, and that created a very unusual, atypical, process by which the policy system was constructed and elites that managed and governed it had themselves to evolve a measure of “class consciousness”, and formalize its governance. It is not clear whether the Virginia Transition Period enjoyed a formal policy system, or rather operated a “faux” policy system that resembled a feudal land-based oligarchy rather than a representative-based policy system. That heritage would incorporate itself into the formal policy system that emerged after 1642.
If we “follow the money” during the Virginia Company period and during the Transition Period, we shall see how the flow of investment, or rather the lack of investment into Virginia and the tobacco monoculture led to the formation of competing elites that (somehow) formed a fledgling policy system. With the Company’s failure in 1625, power, such as it was at that time, fell into the hands of the Virginia Company’s domestic officials. That “money” sourced and revolved almost exclusively from tobacco export, produced by the ownership of plantations acquired from the company’s beneficence, and the ability of Company officials to manipulate the importation of a workforce based on a headright incentive it inherited from the Company. We shall see later, the role of defense and security from the Powhatan was a hugely important driver.
New investors founded new plantations using the headright, administered by the former Company officials, now governors and elected officials in a royal administration over which they king and his Privy Council assumed little direct role or responsibility. That meant the flow of money came from tobacco, and the investment in its plantations. Here we can see the inheritance from the Company period is what we call the tobacco monoculture. What we shall do in this module series is describe in detail how that tobacco monoculture evolved and established itself during the Transition Period, 1625-1642.
What we will shortly see is the period during which the Virginia Company held its charter was characterized by unstable governance chiefly caused by the instability of its investors to reconcile investment with profits from such, and their breaking down into competing groupings with different styles of colony-building. The disaster of the 1622 “Massacre” and the Second Powhatan War provided the coup de grace to the Company efforts and in 1624-25 the Company lost its charter over Virginia, with the King inheriting the residue of whatever survived. His death in 1625, and the coronation of his son, Charles added yet another layer of dysfunction in that Charles did not place Virginia very high in his priorities—i.e., there was no royal money to follow.
If we “follow the money”, the investor’s money over this period, we can see there is no consensus on how to fund the colony, and to raise the sums needed to establish a permanent colony in the wilderness. The original investors bailed ship by 1616, and a coup in 1618 set up a second group of investors, who themselves were ousted in a series of conflicts and scandals between 1622 and 1623.
Most of these approaches with which we are familiar are not appropriate to employ in sixteenth century colonial America. In a limited sense we can see some heuristic value for our contemporary approaches use in England because that county will become the motherland, the home base for modern finance, industrialization, representative government, and in this module, finance-industrial capitalism—the first phase of modern capitalism. We are in 1630 closer to one hundred and twenty-five years away from start of the modern industrial capitalist system of Wealth of Nations and Adam Smith (1776)
The elites that Smith describes, the capitalists, took several centuries to mature into that final grouping, our so-called bourgeois capitalist class. Sparing ourselves the misery of defining just what a class is, this history simply asserts the “groupings” we observe developing in colonial America in 1630’s and in the seventeenth century have not matured into a class. So we cannot talk about capitalists, working class (especially because we are operating within a huge agricultural economy) which is about one hundred years out of a late medieval three class system, composed of several sub-classes.
There are only traces of modern class consciousness in colonial Virginia at this time, but there is a sustained identification with the sub-classes of the late medieval system: aristocracy, gentry or gentlemen, merchants, clergy, free holders, an emerging group of large landowners, and the “new serf”, the indentured servant and apprentice. It is reasonably safe to observe the modern capitalists will descend from the merchant grouping. Merchants in the sixteenth and seventeenth century are not just “shop keepers” of the day, but included the financiers-lenders, traders, and those that produced goods and services, extracted minerals, and sold them to others.
Heritage of the Virginia Company using “Follow the Money”
In our Jamestown module series, we discovered a sub-class of merchants, the “merchant adventurers” who were the pioneers of English colonialization. These guys specialized in foreign trade (privateering when appropriate). By the time of the Virginia Company a collection of these merchant adventurers decided to try their hand at setting up a “permanent settlement-English colony”, a public private partnership with the King and the merchant adventurer using the joint stock corporation as the investment-colonialization vehicle.
Beginning in 1607 the Virginia colony operated under the auspices of the Virginia Company chartered by King James—this was as much an experiment, a prototype which was intended to conform to the realities confronted in establishing a permanent trading settlement in the wilderness of North America. The “mistakes” that nearly destroyed the Jamestown colony were less mistakes, than an inability to define what a permanent settlement meant, never mind entailed. The initial business plan was tied to the older trading factory model used in trading with an established country, and it just failed within months of the settlement’s founding.
That initial misadventure might have been recouped, but the real killer was the motivations inherent in those who invested in the old trading factory were incompatible with those required of a permanent settlement. In fact, it is at this point we can clearly see the old “London-based” merchant adventurers headed by the Company’s chief officer, Thomas Smythe seemingly recognized they model they preferred, followed by the East Indies Company, was not going to work in Virginia.
The old investors, stopped investing in the Virginia Company and instead made what colonial investment they felt necessary in Ulster Plantation, Ireland, and subsequent financing of Virginia investment increasingly fell to a new investor grouping. In 1609 the parliamentary gentry class bought in heavily and increasingly played a major role in its operations. By 1618, Sir Edwin Sandys effectively took over the Virginia Company (but not the Somers Company in Bermuda). At that point a new, semi-autonomous sub-corporation, the Magazine, was formed and acquired a king’s monopoly over the import and export of Virginia’s supplies and its exports.
Smythe maintained control over this provisioning function and the Magazine purchased Virginia tobacco at the lowest of prices and resold it in England, the profits for which were used to pay Company costs with the excess going to its private investors. Needless to say, this was not to the benefit of Virginia’s plantation owners, most of which were Company officials. In effect, at that point the older merchant adventurers had obviously concluded they wanted as little to do as possible with the actual settlement of a long-term permanent colony. That would be left to Sandys and his gentry investors.
The contrast between the merchant [adventurers] refusal to support the colony through [investment in] the general stock [company] and their willingness to exploit it through their commercial monopoly [the Magazine] was a central theme in the successful movement against the merchant [adventurer] directorship that resulted in the company reforms of 1618 and the takeover of the company by Sir Edwin Sandys, ’gentry party’ from Sir Thomas Smythe’s merchant party in 1619. As Lord Robert Rich observed of the period before 1619, ‘the merchants … affected nothing but their immediate gain though with the poor planter’s extreme oppression as appeared by their Magazine [99] Robert Brenner, Merchants and Revolution, p.99
Sandys, however, made a gallant attempt to diversify the economic base, reduce the Company’s obligation to invest in the colony by allowing new investors to start their own plantations and finance their own workforce independent of the Company. This is the “colony within a colony”, and the Company’s use of “hundreds” governed by the new institutions set up by the Great Charter. The cornerstone of Sandy’s pivot toward a permanent settlement strategy was his famous headright incentive system that provided land grants for private investment.
The bottom line of this initiative was the Magazine was bypassed, the supply ships were reduced considerably, and the new immigrant colonists, shareholders, free holders or indentured, were on their own to both import and export their produce. From this perspective we can see how the headright incentive became the means by which the Sandys group were able to offer sufficient value to encourage independent investment in the colony.
Sandys’ takeover was more a coup, a coup that started a corporate civil war, infused heavily with national politics and the polarization of issues that was leading England into a civil war. The Smythe merchant adventurer faction took advantage of Sandys’ weaknesses and the Indian War, with the King’s support shut the Virginia Company down, with the hopes and intention of restructuring it and removing the Sandys group. By 1624-5 the King had had it with Sandys, and he revoked the charter (temporarily) by court action.
James then established a new commission for Virginia, stacked with merchant adventurers and the Rich faction (which had joined with Smythe), whose purposes clearly were to restore the reformed Company to once again operate the Virginia Company. Along with a charter a tobacco and trading monopoly would be attached to the Company, providing the profits the merchant adventurers desired.
Shortly after all this was in place, James died. The Commission was terminated, and Charles, James’s successor had other ideas, priorities, and goals; the charter was never restored to the Virginia Company (although it nearly was, as we shall see in 1631-2). In 1626 when it seemed certain the charter was dead, and after Smythe had died, the other old merchant adventurers moved on, abandoning North American colonization in preference for their more established and successful trading factory enterprise associated with the East India Company.
They were simply unwilling to invest in “plantation development” (our settlement strategy) on which Virginia’s tobacco export and supply provision was totally dependent. Plantation development required an active and decentralized site management-governance, and given the widely dispersed shredded community that meant intensive involvement with plantation owners and their investors. That was far too many moving parts, i.e., risk, and a serious lag between investment and profits. They strongly preferred a voyage jointly funded and an in and out trade with the target area, operated from a trading hub, not a self-sufficient settlement.
The majority of plantation owners were far too fragile and dispersed to make the effort to acquire capital on which they were dependent for both short term financing and long-term infrastructure. However, “the more substantial Virginia planters appear to have controlled a significant portion of the early trade in tobacco. These men brought their capital with them [or had their own access to investors], and performed their own marketing [principally workforce] with the help of sea captains. Then too, some of the leading tobacco merchants seem to have bought plantations on their own, thereby bringing all aspects of colonial development under their direct control. Perhaps the more common arrangement was for the merchant to enter into business in partnership with a local planter” [99] Robert Brenner, Merchants and Revolution, p. 103-4
What all this translated into was the Virginia Company left behind in its wake not only a tobacco economy based on dispersed shredded community plantations, they also were left with a system of financing that was not only decentralized to the plantation, but fragmented among a number of financiers and different forms of financial relationships. “… after 1625, free trade became the rule in American commerce [not monopoly commerce], and the expanding trades in tobacco and provisioning were opened up to anyone who could find the capital. By 1634, there were 175 men operating in the Virginia tobacco trade, and in 1640, there were 330 … Fiercely competitive conditions therefore prevailed in a period of rising production. As a result, there was a rapid fall and general instability in commodity prices” [99] Robert Brenner, Merchants and Revolution, p. 105
Piled onto this was the fate left to the smaller planters who could not assemble or produce the volumes needed to attract financiers and their intermediaries. These smaller plantations did not achieve sufficient profits to “get ahead”, to sustain themselves and invest in their plantation, and in bad years they could not absorb losses. Many were forced to mortgage their land, and their larger plantation owners became their chief source of credit; as such they were nominal landowners, dependent in so many ways on their neighboring large plantation owners. For them there was no escape path out of the monoculture, save making a completely new start.
A not well-observed consequence of the withdrawal of the older merchant adventurers from the Virginia Company and its subsidiaries (excepting Bermuda), was those aristocracy, who for their own reasons were interested in colonization, had along with the guilds, provided a good deal of the investment capital to the Virginia Company, then had to find a new grouping of intermediaries willing to colonialize North America—or they had to actually organize their own corporation to conduct the colonization. An example of the latter was the “Providence Corporation”, and Calvert’s Maryland joint stock corporation. In summary, the colonization-minded aristocracy were cast adrift and they gravitated to the the colonial-focused joint stock corporations that remained–or formed their own.
The next and final question to be tackled is “Who Finances?”, whose money is it we follow after 1625 through the Transition Period and after? Brenner starts us off:
Neither company merchants nor landed gentry were attracted to colonial investments because they had such promising alternatives immediately open to them. The gentry naturally turned to management of their estates, as this was a period in which rents were rising rapidly; the merchants continued to focus on developing the very profitable southern and eastern trades. Both therefore left the Americas open to an entirely new group of traders from social strata much lower than their own … the men who developed the American colonial commerce were from unimpressive, often obscure socioeconomic backgrounds … They were, in fact, probably led to enter the colonial field in large part because their economic options … were so sharply restricted. Indeed, the NEW MEN (mine) of the colonial trades succeeded in developing colonial plantations and commerce … because they were willing to accept profit margins, take risks, and adopt methods of operations that neither the merchants nor the gentry would seriously consider. In particular the regular travel to, and sometimes settlement in the colonies that overseeing plantation investment required…. They were willing to do these things without monopoly trading privileges [99] Robert Brenner, Merchants and Revolution, pp. 111-12
But before we introduce the reader to them, we need to briefly introduce the reader to the trading structures they would employ in making their investments and managing their diverse activities.
The Structural Heritage of the Virginia Company
When the traditional first-generation merchant adventurers, led by Thomas Smythe (who died in 1626 anyway) transferred their attention on the East Indies, and with the Sandys faction ousted, left the remaining corporate organization to whomever could manipulate the Virginia Company internal subsidiary companies. Without colonial charters, these shell companies for the most part, not unlike a “SPAC” of our contemporary stock market, were free to do whatever their investor boards willed. As we shall see a new grouping of English colonial investors will infest these corporations, beginning a half-century of New Men whose business models financed the installation of the economic bases of our thirteen colonies. We are about to see another major reason why our states and cities are similar yet amazingly different from each other.
At this point, we must refresh ourselves with the evolution of the English, now increasingly “British” investor-colonization and trading class. As we have seen with the Virginia Company experience, the colonization-investor class had its own troubles. It was drawn into a close, but unloving alliance with the Stuarts; it had wandered into the governance of the City of London; it was split into competing rival constituencies: cloth merchants (the largest element), the Smythe foreign merchant adventurer traders; the merchants and traders in England’s secondary cities and ports who had sought refuge in their gentry representatives to Parliament who pushed back hard against London merchant monopolies; and a bunch of somewhat entrepreneurial-privateer aristocrats that hated Spain and Papists and wanted English colonization to be infused with anti-Spain initiatives. Now that’s a mélange that would defy the governing abilities of any monarch.
It also did not help that Court and Parliamentary politics, pretty bad while James I was king, got even more contentious and way more complex, year by year coping with Charles. Both rules chief recourse was suspending for multi-years any Parliamentary session. But in session or not Parliament was still engaged. with King and Parliament traveling down ever opposite paths.
Charles entered in 1625 into a war his father did not want, against Spain. It ruined the continental trade of cloth, and depressed the largest non-agricultural sector of England’s economy, promoting demonstrations, and a sustained willingness to immigrate by an increasingly surplus population. Ireland was the principal beneficiary, but North American colonization picked up momentum. When the war ended in 1630, the experience had only worsen the clash with Parliament, and further widened the English interest in using colonial ventures as a check on the Spanish Empire.
Into these hollow, empty, but willing, shells, new groups of investors commence a new flow of money to finance English colonization. A series of investors took over subsidiary company boards by investing in their shares and using such to start their own versions of a colony using not the Virginia Company joint stock model, but a “proprietary” corporation based not on open shareholder investment which had failed miserably with the Virginia Company, but with a corporate board governed by a cast of permanent members who could perpetuate their control over the colony, unless terminated by the King. This was a pay to play model of fund raising, and it worked. For the most part the rest of English colonial America will be governed by some version of a proprietary colony. Virginia was the only joint stock corporation.
The first one was the famous Pilgrims of Plymouth Rock fame. That was in 1618-1620. A flurry of others followed in the 1620’s. When the Sagadahoc corporation was restructured into the “the Council of New England), it tasked itself to the settlement of New England: the Massachusetts Bay Colony, and eventually Connecticut (New Hartford Corporation), and New Hampshire corporations-charters resulted before the Council of New England was disbanded in 1635.
Within the Council of New England, however, we can see a horde of gentry, closely associated with the lesser ports and large cities of England (i.e., rivals of the massive London gentry and merchants) assuming influence and putting their capital at work towards colonialization. Many of these investor-board members were associated with the displeased Puritans, and were closely tied with Parliament. The take away, of course, is that the major fissures within English politics that were prompting the drift to civil war crept into English colonialization. With the King supposedly controlling the Virginia colony (if only he had), we see that much of English colonization had wandered out of his direct control into corporations unsympathetic to his policies, especially his religious program.
In this drift from one joint stock corporation to another we will be able to see the vacuum in which colonial investment was filled with Protestant non aristocratic investors who developed their own capital, from their own Rolodex of investors, or who could forge relationships with aristocrats that wanted a colony investment to diversify their portfolio, without having to take an active role in the colony and its settlement. These are the core of what Robert Brenner will call “the New Men”. It is this second generation of merchant adventurer, mostly Puritan in these years, that will take over investment in Colonial America. These “New Men” will follow a different investment plan, and develop their own style or approach to settle a colony.
Virginia, perhaps amazingly, is where several of their most prominent of these new investors had got their start and just as amazingly, these “New Men” will infuse themselves into the financing of Virginia’s tobacco plantations—and important to this module-jump start a new grouping in Virginia that will break away from Virginia’s mainstream large planter grouping and confuse Virginia politics during the 1630’s—all the way into the Restoration of 1661.
Uniting with a subset of Virginia’s plantation conquistadors, they will develop and finance a breathtakingly ambitious enterprise whose aspirational goal was to acquire a monopoly of fur trade with the Indians, control the Virginia tobacco monopoly, and to forge as close to a monopoly of “provisioning” (controlling the import of supplies and goods into North America) any English North American colony. They nearly pulled it off, as we shall see, only to founder on the reefs of Maryland. They were trying to create a continental Hudson Bay Company, a functional equivalent to the East India Company that they would run out of Virginia. That story will consume many a page in this module series.
But there is one last important story that we leave for other modules and module series: how this grouping would mature over the seventeenth century to become an important core of the finance elite that will evolve into modern capitalism of 1750.
What the reader will see, however, in this module series and in future ones, is how the events associated with this grouping “bent the Virginia twig” in such ways as to alter the structure of Virginia policy-making in ways that persistent well into the twentieth century, if not to the present.
Recasting the Fall of the Virginia Company as a Struggle Among Merchant Elites
The civil war within the Virginia Company, pitting Warwick and Sandys against Smythe and his traditional merchant adventurer traders eventually gave way at its end to a Smythe and Warwick (his son) ouster of Sandys by getting the King to terminate the Virginia Company charter. By that time, the adventurers always dependent on royal favor, had blended with the guild and cloth traders, and had blurred their trading careers with a career in the City of London’s elective and office holding governance.
Their identification with London, responsible for the establishment of the two subsidiary corporations and the two colony startup in 1606 had by 1625 expanded into a clash between London and the secondary ports and cities that permeated into and became a core strand in the Parliamentary position against the King and his style of arbitrary, difficult to compromise, divine right governance. The trading company monopoly approach that precluded gentry investment in colonial opportunities had been shattered by the legislation that created the Virginia Company, and after the 1609 investment had left the Company with two hostile sets of shareholders that fell into a civil war by 1618.
Largely ignored by American historians, the Virginia Company had been a battleground between Edwin Sandys and Smythe, papered over by lottery funds that substituted for an unwilling investor class to finance the sustained support of a permanent settlement in Virginia. When the king ended the use of lotteries, the jig was up, and Sandys in 1618 launched his Parliamentary-supported bid for dominance over the Company. While the King was loyal to the merchant investors, the implosion that followed the Massacre of 1622 created a cattle stampede of opposing forces that in the end led James to call an end to the joint stock charter, and assume his own governance. The suspension of the charter in 1625 was not intended to be permanent, but James died and his son had his own mind, and priorities, about colonial involvement–and they did not include the Virginia Company.
Amid these goings on, a further schism within the aristocratic investor class, between the merchant adventures and aristocrats such as Warwick, Butler and Rich believed English colonization should be directed as a check against the Catholic Spanish and her immense empire. They favored Anti-Catholic privateering, and a more opportunistic fusion of colonial startups in Spain’s back yard. This was not at all to the liking of Smythe’s East Indies merchant adventurers’ who, more closely tied with royal foreign policy , centered around a “quick profit” trading post-factory model that promised success in Asia and the Orient, but never fit well with Virginia’s permanent settlement in the American wilderness.
If the Smythe era merchant adventurers learned anything from their horrendous experience with the Virginia Company’s efforts to link investor profit seeking with an effective permanent settlement self-sufficiency strategy is that they couldn’t. Competing with the Irish Ulster Plantation, James’s priority, they put whatever investment cash they could commit there, and not in Virginia. What they felt more certain of was the market philosophy pursued by the Dutch and their East Indies Company; this was akin to the trading factory resident in a settled geography with developed cities and policy systems, with whom they could negotiate deals-or conquer.
In Virginia they settled for an economic strategy built around tobacco and a company magazine monopoly for provisions–a monopoly that lend itself to inefficiency, if not outright corruption, alongside a good deal of customer dissatisfaction that encouraged the customer to make his own way in his isolated plantation. England’s tobacco monopoly and insistence that tobacco be routed through London helped–but it helped the custom farmers a lot more because that was where they money was made, not in the logistics. The need for a serious, if not core, element of a permanent settlement for an economic base that produced sufficient staples and “tools” in the colony so that “self-sufficiency” or sustainability of the colony’s population would be much less dependent on costly supplies from the motherland.
That was not compatible with the time frame of investors who formed the core of the merchant capital available the merchant adventurer period. It was that mismatch, along with the time lag in understanding the requirements of a permanent settlement that was primarily responsible for the ultimate failure of the Virginia Company joint stock company–in Virginia, but not Bermuda. Efforts to revive the Virginia Company after it was stripped of its Virginia charter did not arise from these merchant adventurers, but from Parliamentarian gentry investors that comprised the group led by George Sandys who dominated, if not led, the former Company officials during latter 1620’s through the early 1640’s.
Sandys’ experimentation in the merchant adventurer model was too late and too little, and Sandys saw the need for a new self-sufficiency model that broke with the merchant adventure monopolistic model of company magazines and investment vehicles. Sandys was willing to allow new, even non-Company, shareholders, to start plantations of their own and to allow them a measure of self-governance–a colony within a colony–that was expressed in the institutions he created with his 1618 Greate Charter reforms.
He allowed these plantation owners to cut their own deals with investors, import their own workers (not dependent on company-servants and supply ships) encouraged by the headright incentive system, and through the Council of State and Burgesses-General Assembly manage their own affairs, with close monitoring from London. It was these folk, that we have seen develop during the post company vacuum into the plantation conquistadores, the plantation-owning planter class, and now, with Claiborne, a potential merchant-logistics-finance class with its precursor to the Hudson Bay business plan.
And then came 1622. Rent by divisive internal politics and constituencies, without a consensual strategy on how to approach permanent settlement, the going concern that was the Virginia Company was put in a royal “receivership” in 1624-5. The shared decision-making with London-based investment community might have worked if the Company was not fighting bankruptcy and engaged in its great civil war, rendering the Company unable to meaningfully assist the local elite and thus maintain their loyalty to the Company.
The domestic officials assumed authority and in essence provided what little government was needed to restore order, seize Indian lands, and export tobacco. By 1630, a local oligarchy more or less ran things, mostly through the Council of State and a domestic Company official as governor. And then as we have seen, the King appointed John Harvey as governor, and then governor and Council were at loggerheads. In short, Virginia itself had fallen into a oligarchic semi-anarchistic free trade zone that happened to pay its bills and make some profit by exporting tobacco. Until about 1630 when the price of tobacco fell to abysmal low levels, in large measure due to tobacco overproduction. This Virginia colonialization effort was not working all that well. Charles, he with other priorities, was dragged into its governance–hence the Dorset and Laud Commissions.
Injecting Brenner’s Assertion into Virginia’s 1630 Situation
For a decade or so, the illusion of tobacco as an export profit maker sustained the Company, and enabled its transition from joint stock to royal gubernatorial policy system. Former local Company officials united behind the Greate Charter institutions, and were joined by representatives of the investor-owned hundreds and the owners of scattered plantations-communities they made decisions, infamously to permanently pacify the native population and seize their lands and crops to facilitate growth in tobacco monoculture and their own personal security and substance. A vacuous Charles, unwilling to assert his governance, let by default the locals run their shop, and develop their own ambitions–and the Claiborne venture was its first major outcome.
Whatever potential that venture had for Virginia, for Brenner it was arguably Virginia’s first major step in leading the path to develop a new English colonial investor class based in London–a replacement for the ever absent old Elizabethan merchant investors who had moved on. But if every action creates a counter action, Claiborne’s initiative had triggered the formation of a ill-organized, disparate, planter community left outside the new Claiborne joint stock adventure.
The collapse in tobacco prices around 1630, and arrival of Harvey, a most unfortunate choice by Charles, as governor weakened whatever hold the provincial executive branch had over Virginia economic and political development, and opened a opportunistic vacuum into which Claiborne and Tucker in particular united with a new grouping of English investor-owners, a grouping with close and direct involvement with tobacco export and ownership of Virginia plantations, to combine in a powerful game changing initiative that broke with the larger Virginia planter class and challenged, by the nature of its initiative, the authority and impact of the governor–if not the King. And then came the Maryland grant to Calvert by Charles!
Pushed aside in all this was the larger planter community, composed of large plantation owners, and associated with small and household plantations that grew and exported tobacco. Compared to the handful of Claiborne conquistadors, who while dominating the export of tobacco and the market for indentured servants, could not match the ability of the planter community to dominate local-hundreds-shire government, and the Burgesses when in their infrequent session.
Confronted with the reality of depressed tobacco prices, chronic Indian warfare, and now a governor who curtailed their essential flow of land sales and indentured servant headright, these tobacco plantation owners came together to sort out a program of self-reform and an export market favorable to their profit expectations. The revival of the Virginia Company, an event they could not seemingly stop, and the implementation of the Kent Island Claiborne Clique trade-export-import-London investment model in their eyes threatened they economic, and likely political autonomy, and so they fought Claiborne–and then came the Maryland-Calvert colony.
Carved out of their Virginia, saturated with hated Papists, Maryland created a rival group of tobacco planters with whom they must compete–to send their own scarce supplies to sustain them in their fragile startup added insult to injury. That Maryland could house the Claiborne venture was yet another scenario they feared. This was a scenario that seemed possible as Claiborne’s London investors after 1635-6 were evidently making their peace with Calvert.
They were never successful, but their 1631-4 effort came within inches of success- largely cause it was one element among several that thought they could profit from the Company’s revival. One of those other elements, of course, was Virginia’s own Claiborne Clique and their London investors. As Brenner argues this reflects the politics and initiatives associated with a transition period in English colonial capitalism. With the initial model of investment removed from new colonial ventures, some other form of investment capitalism, absolutely imperative to sustain over time a colonial permanent settlement in the hostile wilderness of North America had to be devised and evolved.
Brenner’s New Investor Class Takes Shape in the New World- Brenner is most concerned with following the rise of this London-based investor class. We on the other hand are more interested in the effect this new investor class had on the economic and political development in the colonies–and in this module Virginia. Still, the reader must be made aware that Thomson and his emerging colonial investment model-initiative was simultaneously with Virginia setting roots in other colonies as well.
Thomson, I think, was as much, if not more interested in the West Indies, but several of his core partners had pioneered early experiences with, of all things, the near defunct second subsidiary of the Virginia Company, which had been reconstituted as the New England Council. In our Massachusetts chapter we will explore that in more detail. Its action do affect Virginia, but at this point we are more interested in allowing Brenner to make his case testing his model over the next two decades, calling attention to Thomson and his investors drift away from Charles and the royalist cause, to the Parliamentarian, thus creating a bridge to the Cromwell Protectorate. As we delve deeper into these convoluted politics in later modules, we will look more deeply into his framework–for now the reader should appreciate we are dealing with the initial years of Brenner’s model, and they are fluid and volatile reflecting the incredibly dysfunctional and disruptive dynamics that led to the English Civil War–and the Cromwell Protectorate.
This period is critical for us because Virginia’s New Men are close friends of Thomson. Claiborne and his Virginia Clique of plantation conquistadors follow along in companionship with Thomason and their plan will break from the pattern and politics of the mainstream Virginia planter elites, causing serious disruption to the point of polarization within that emerging Virginia elite.
The reader should understand this drift is the essential piece of information that will tie together the next three decades of Virginia’s policy system. It will provide the key to open the door for the survival of the Virginia planter class in the turbulent world of the English Civil War through the Restoration. It will provide the insight as to why Samuel Mathews will die in London in 1657 in the five year long process of conducting Cromwell’s attempt to restore his order and control over the Middle colonies. Mathews’ twenty-one year old son will at the time be governor of Virginia, while the former royal governor, William Berkeley, sits in his personal estate in retirement that will last a decade.
Brenner’s main concern was the development of a new capitalist class that would emerge during the sixteenth century, replacing the Elizabethan mercantile merchant adventurers capitalism, and evolving a different form of capital investment, provided by a different grouping of investors, a different class composition, and generational cohort change tossed in for good good measure. Virginia and the West Indies were central players in his evolution and development of the new capitalist colonial investment model, and he expends considerable time and pages to develop what occurred in Virginia as evidence to how that evolution played out–and why.
We are without any doubt largely in agreement with his thesis, and find it offers not only a wonderful view of how Virginia evolved her post 1630 economic and political development, but also explains how that evolution created the economic and political base on which the glorious glory days of Virginian eighteenth century plantations rested–until they began to collapse during and after the 1740’s. That collapse created the background for the drift of Virginia’s elite into the drive for autonomy and then independence. That Virginia dominated the first half of the Early Republic that followed, and played a huge role in constructing its constitution, only further supports our belief that we must properly understand the economic and political system that evolved after Jamestown and the Virginia Company.
Maurice Thomson, and his family, are Brenner’s leading actor in this early period of transition. Thomson got his start in Virginia, and that is how he got caught up in Claiborne’s initiative. But Thomson had his own ideas and before Claiborne he was already seriously engaged in forming his own investment company, his own Rolodex of investors and “lobbyists”. By the 1631 Dorset Commission and then Laud Commission, his success in starting New England and Canadian initiatives had been conducted–and were able to be successfully tapped in incorporating a wide North American-wide scope and scale to Claiborne’s upper Virginia escapade.
Thomson, and the adventurer network that was his brothers and sister, however, almost raised in Virginia were also simultaneously involved with the West Indies–which we must confess conveyed more promise, at least in the pre-Civil War period and during it, of profits, wealth and status. As we shall see in this module, when Claiborne ran into trouble with his initiative after 1637, he joined with Thomason in a wild West Indies venture of his own. This is part of Brenner’s model because what he was demonstrating was a new “entrepreneur” as investor. In his fourth chapter he charts “the meteoric rise of an entirely new group of traders, originating almost totally outside the company merchant community [Smythe’s merchant adventurers], which assume the task of developing American plantation production and commerce from about 1618 through the 1640’s” [99] Robert Brenner, Merchants and Revolutionaries, p. xii
What Brenner believes happened during this transition is an “entrepreneur” took residence in a colony, set up a project (settlement, plantation, economic venture (fur trading, logistics), imported a workforce, and laid in place his contribution to the colony’s economic base:. To secure the capital required for his project, the entrepreneur developed a partnership with London-based investment capital sources–investors who relied on the entrepreneur to create and sustain a sound business venture that could repay the investment, not only be covering the debt through sale of the venture’s exports, but through additional sales of provisioning and quality of life goods provide new revenues and profit.
A partnership of sorts between entrepreneur adventurer and London capital would solidify and, on their own, each plantation owner could “do his thing” and grow his project, with capital and imported goods from England. Here we can see how the economic autonomy of each plantation set in place dynamics that greatly impacted the development of Virginia emerging and fragile policy system. That it relied on imported dependent workforce that eventually transformed into a slave-based economy is yet another consequence of this new developmental partnership. In its final days, English capital was less used to buy new land, than to buy more slaves. That it resulted in increasing debt of the landowner, creating a debt-ridden elite, would lead to its own dynamics, that mightily impacted our developing nation.
With this capital the entrepreneur not only profited, and his future generations benefited (or not as we shall see), but was able to build what infrastructure he needed to sustain his operations and grow them over time. This model of investment-economic development matured during the transition period, and by its end in the 1660’s it was incorporated into a second generation migration into Virginia sponsored by the economic development strategy of Governor William Berkeley. By that time this investment model was built into, an invisible part of the infrastructure of Virginia’ s economic base–and was simply accepted and passed onto future generations, “without question or pause”–until it was obvious it was not working in the 1740’s.
That this transition period overlaps with the decline of Charles I’s regime, drifting toward civil war, and then into a two decade long civil war and Cromwell Protectorate meant that English colonialism was no longer a primary initiative of the Crown or Parliament (if truly it ever was), and with war consuming much of the available capital, meant that new colonies, and Virginia as the first colony, had to figure out their own investment models, and evolve them in the vacuum that was English colonial policy is this period of the 1630’s through the 1660’s.
In essence the colonies were on their own as they tried to attract the capital absolutely necessary to finance their settlement, associated infrastructure, and to establish and support the economic base they were required to build that would be able to support the permanent settlement more or less autonomously. That each colony after Virginia, while it would learn from the previous experience of the existing colonies, had to adapt those lessons to their geographies and the time period dynamics of their settlement. The reader, I suspect, can easily see how this transition period, will insert a partial answer into the question that underlies this book: Why are states and cities different today?
Ron W. Coan 