126levels of consumption of British goods in the past was not necessarily what caused any subsequent increase in demand for British goods in the future. Mindful of this caution, the following sections of the chapter seek to identify some of the main reasons why consumption levels of British products remained so relatively high in the settler colonies throughout the late Victorian and Edwardian era.
Official policy
Operated for reasons of power, empires, it is often said, were integrated by force. Yet how did ministers and officials try to mesh together markets in the British World? How far, for example, did they seek to obtain special commercial benefits from the settler colonies? State intervention in the field of discriminatory export duties – or ‘preferential tariffs’, to use the jargon of the time – generated a great deal of political controversy in the early twentieth century.17 Businessmen were drawn into these debates,18 and their attitudes are discussed in greater detail below (see ‘Chambers of Commerce’, below, pp. 145–50). Yet despite vigorous campaigning on the part of Joseph Chamberlain and the ‘constructive imperialists’, Britain clung tenaciously to ‘his holiness free trade’, as Marx disparagingly termed it. For many later Victorian and Edwardian politicians the commitment to free trade was indeed held with all the passion and emotion of a religious belief. The alternative, protection, threatened not only tariffs, and higher prices for consumers, but greater government interference more generally.19 There were also differing views as to the commercial potential of the English-speaking parts of the empire, and a widespread apprehension as to whether they could ever be economically self-contained. Britain received a series of tariff preferences in dominion markets from the 1890s, all granted on the latter’s initiative, even though it did not finally reciprocate until 1919.20 Cecil Rhodes led the way in 1896, inserting a clause in the charter of the British South Africa Company. Tariffs on
17 The classic account remains A. Sykes, Tariff Reform in British Politics, 1903–13 (Oxford:
Oxford University Press, 1979). For more recent contributions to the debate see Cain,
‘Economic Philosophy’; E. H. H. Green, The Crisis of Conservatism: The Politics, Economics
and Ideology of the Conservative Party, 1880–1914 (London: Routledge, 1995); and
A. S. Thompson, ‘Tariff Reform: An Imperial Strategy, 1903–13’, HJ (1997), 1033–54.
18 A. Marrison, British Business and Protection, 1903–32 (Oxford: Oxford University Press,
1996).
19 Thompson, Imperial Britain, p. 104.
20 Fieldhouse, ‘Metropolitan Economics’, p. 90. The details below come from Thompson,
Imperial Britain, pp. 90–6 and L. Trainor, British Imperialism and Australian Nationalism:
Manipulation, Conflict and Compromise in the Late Nineteenth Century (Cambridge:
Cambridge University Press, 1994), pp. 109–18.
127Markets and consumer cultures British goods entering Rhodesia were not to exceed the level of the Cape Colony tariff prevailing at the time of the Charter. This (latent) preference eventually came into effect in 1906, albeit that Britain’s exchange of goods with Rhodesia was too small for it to matter. A more significant step was taken in 1903 when a customs union conference, comprising all of the South African colonies, adopted a general tariff that treated British imports differentially. A further step was then taken in 1906 when a new agreement lowered duties for English exporters while generally raising them on foreign products. This was but one of several tactics used at the time to block further American economic penetration of the South African market. Here political power was certainly made to count – and this episode is discussed below (see pp. 141–2). Subsequently, in 1910, when the Union adopted the Transvaal’s protectionist tariff rather than the Cape’s revenue-producing tariff, the economic geography of the region began to change. Henceforth British manufacturers had to take local manufacture much more seriously if they were to preserve their market share. Meanwhile in Canada J. A. Macdonald’s Conservative government responded to pressure from local manufacturers, and the spectre of rising unemployment, by introducing in 1879 a ‘National Policy’ of protective tariffs to secure the home market – competition from American imports was particularly acute at this time.21 Over the next decade the number of manufacturing establishments, and the capital invested in them, grew. Subsequently, in 1897, Wilfred Laurier’s Liberal government adopted a general tariff, maintaining a high level of protection, yet providing for ‘moderate but promising preferences on imports from sister countries of the empire’.22 Rates were reduced on goods for countries that reduced their charges on Canadian exports. The rates on some British imports were lowered by almost a third, which in turn stimulated British export performance to Canada during the early twentieth century.
The New Zealand parliament carried a preferential trade bill in 1903, granting preferences to Britain and providing for similar reciprocal arrangements with Australia and Canada. In 1906 this principle of preference was further extended: the duty on certain British exports dropped by nearly 1 per cent, while the duty on foreign goods increased and preference was extended to a wider range of British goods.
Before 1901 each Australian state devised its own tariff regime. Victoria was staunchly protectionist, while New South Wales adopted
21 M. Bliss, Northern Enterprise: Five Centuries of Canadian Business (Toronto: University of
Toronto Press, 1987), pp. 227, 247–9, 300.
22 Ibid., p. 301.
128tariffs for revenue raising purposes. Federation saw the removal of customs houses along state borders. In 1907, a new Australian tariff bill was piloted through the Commonwealth parliament by Alfred Deakin, Joseph Chamberlain’s most dependable colonial ally. It gave preference to British goods by increasing the duties on foreign goods, and by increasing the number of goods on an ‘empire free list’. By 1909, two-thirds of British imports paid duty, ‘but at a rate that on average allowed them to be priced about 5 per cent lower than the competition’.23
As Table 3.2 shows, none of the tariff or other forms of preference afforded to British products before 1914 had a marked effect on colonial consumption patterns.24 There were exceptions, some of which date back to developments earlier in the century. A clause of the 1842 Copyright Act aimed to protect the imperial trade in books by forbidding colonial reprinting of texts copyrighted in Britain. Though difficult to police, it helped British publishers gain access to colonial markets, and a high proportion of the revenues of nineteenth-century London booksellers came from supplying books, magazines and other types of print to British expatriates and settlers. The ‘colonial edition’ – books published in series that contained mainly new British novels, and sold cheaply as the only likely solution to the problem of pirated publications – was the main device used to try to control the English language market.25 Colonial editions were commonplace by the early 1900s, with seventeen London publishers issuing them. They were intended to ‘share the fruits of British civilisation with Britons abroad’, with many titles ‘glorifying British virtues and British military success overseas’.26 Macmillan was the leading publisher of these editions, launching its successful ‘Colonial Library’ in 1896 and ‘Empire Library’ in 1913. Australasian and South African booksellers thrived on their sales; Australia was the largest market for British book exports, with rapid growth from 1870 to 1884 and from 1893 to 1914.27 The ‘economic hegemony’ of London publishers could no longer be taken for granted by the end of our period, however, as a result of the arrival of the publishing house advance of the ‘old Dominions’.28 In other
23 D. Meredith and B. Dyster, Australia in the Global Economy: Continuity and Change
(Cambridge: Cambridge University Press, 2000), p. 51.
24 On this point, see also Saul, British Overseas Trade, p. 217.
25 G. Johanson, A Study of Colonial Editions in Australia, 1843–1972 (Wellington: Monash
University Press, 2000).
26 Ibid., p. 15.
27 Geographical proximity allowed US publishers to corner the Canadian and West Indian
markets, but it was only during the two world wars that they were able to move tempor-
arily into other colonial markets.
28 Meredith and Dyster, Australia in the Global Economy, pp. 370–1.
129Markets and consumer cultures spheres of consumption the competition was still fiercer. Australia and Canada actually saw the overall level of advantage for British goods fall slightly, rather than rise, during the early twentieth century. The benefits of the preferences, moreover, were often illusory. Duties could be raised on foreign manufactures rather than lowered on British ones. Meanwhile, much dominion protection focused on items locally produced, and thus not directly in competition with British exports anyway.29
The only real deviation from this rule of non-interference in international trade were the formal agreements reached by private companies (not governments) in relation to the chemicals and tobacco industries. The chemicals agreement divided the world into ‘spheres of influence’, with the dominions categorised as ‘natural’ British markets.30 It was mainly concerned with alkalis and explosives; not until the 1920s were dyestuffs and fertilisers included. Similarly, American and British tobacco firms agreed to confine themselves to their respective national markets, while transferring all foreign investment and export trade to a British-registered joint venture called British American Tobacco – BAT rapidly became the leading cigarette manufacturer in Australia, Canada and South Africa.31 The tendency towards cartelisation in these two industries helped to prevent American and German firms from monopolising British World markets, but they were atypical.
The support given by the British government to the development of imperial transport and communications was of greater significance. State-conferred commercial advantages in this sphere are hard to quantify, including as they did the various forms of subsidy offered to private shipping companies by governments (British and colonial), and military expenditure on the Royal Navy, which, inter alia, played a vital role in keeping shipping lanes open to imperial (and international) trade. Nonetheless, oceanic transport was a vital dimension in strategic thinking about the empire,32 and shipping lines clearly had economic as well
29 F. V. Meyer, Britain’s Colonies in World Trade (Oxford: Oxford University Press, 1948),
pp. 90–112; Saul, British Overseas Trade, p. 217.
30 W. J. Reader, Imperial Chemical Industries: A History, 2 vols., Vol. I: The Forerunners, 1870–
1926 (Oxford: Oxford University Press, 1970), p. 60.
31 H. Cox, The Global Cigarette: Origins and Evolution of British American Tobacco, 1880–1945
(Oxford: Oxford University Press, 2000), pp. 4–6.
32 J. N. F. M. à Campo, ‘Engines of Empire: The Role of Shipping Companies in British and
Dutch Empire Building’, in G. Jackson and D. M. Williams (eds.), Shipping, Technology
and Imperialism (Aldershot: Ashgate, 1996), pp. 63–96; R. Kubicek, ‘The Proliferation
and Diffusion of Steamship Technology and the Beginnings of “New Imperialism”’,
in D. Killingray, M. Lincoln and N. Rigby (eds.), Maritime Empires: British Imperial
Maritime Trade in the Nineteenth Century (Woodbridge: Boydell Press, 2004), pp. 100–10
(pp. 63–96); J. F. Munro, Maritime Enterprise and Empire: Sir William Mackinnon and His
Business Network, 1823–93 (Woodbridge: Boydell Press, 2003), pp. 87, 504.
130as military and political benefits. This, therefore, was a field of policy in which government and private enterprise were inextricably and beneficially linked. Mindful of the need for regular communications between Britain and its colonies, politicians were reluctant to rely on the vagaries of the free market. This created a context in which private shipowners and shipping companies, conscious of their strategic significance, could lobby effectively for government subsidies and support.
There was, of course, nothing new about government taking an interest in the regulation of shipping. Until 1849 the Navigation Acts had confined all trade to and from the colonies to British or colonial ships, with predominantly British and colonial crews.33 But in the wake of their repeal, other countries did not throw their ports open to British shipping in the way that had been hoped, and foreign vessels became a familiar presence in trades from which they had been formerly excluded. Competition in shipping grew, especially from America and the Baltic seafaring nations. Aided by heavy investment in steamship technology, Britain managed to claw back some of the ground it lost to these competitors during the 1870s and 1880s. Yet after the 1890s, Britain’s position was further eroded, both in terms of the tonnage using her ports and her share of the world’s steam tonnage. The exception was shipping services to British possessions: these actually grew before the First World War.34 In the case of New Zealand, for example, the proportion of shipping movements attributed to British-owned ships increased from 87 per cent in 1890 to 97 per cent in 1910.35 Several British shipping companies developed close imperial connections – Donald Currie’s Union-Castle Line, Sir Alfred Jones’ Elder Demspter & Co., and the Peninsular and Oriental Steamship Company (P&O). Each became adept at portraying itself as a national enterprise carrying on a public service. P&O’s steamers have even been referred to as the ‘flagships of imperialism’.36 The network of lines created by the company fanned out to all parts of the empire east of Suez. In peace-time,
33 S. Palmer, Politics, Shipping and the Repeal of the Navigation Laws (Manchester: Manchester
University Press, 1990). See also S. L. Engerman, ‘Mercantilism and Overseas Trade,
1700–1800’, in R. Floud and D. N. McCloskey (eds.), The Economic History of Britain
since 1700, 3 vols., Vol. I: 1700–1860 (Cambridge: Cambridge University Press, 1994),
pp. 198–9.
34 P. J. Cain and A. G. Hopkins, British Imperialism, 1688–2000 (Harlow: Longman, 2001),
p. 159.
35 J. Mcaloon, ‘Scots in the Colonial Economy’, in T. Brooking and J. Coleman (eds.), The
Heather and the Fern: Scottish Migration and New Zealand Settlement (Dunedin: Otago
University Press, 2003), pp. 97–8.
36 F. Harcourt, ‘The P&O Company: Flagships of Imperialism’, in S. Palmer and G.
Williams (eds.), Charted and Uncharted Waters: Proceedings of a Conference on the Study of
British Maritime History (London: National Maritime Museum, 1981), pp. 6–28.
131Markets and consumer cultures life in the colonies was made more palatable by the regular delivery of P&O mails, and by the prospect for emigrants and officials of more frequent journeys home. In war-time, the Admiralty turned to P&O for troop transports, for hospital ships and for the movement of supplies. Imperial mail contracting was also important to the development of several steamship companies. Postal subventions were obtained from British and colonial governments. They ‘provided shipowners with the basis for maintaining a comparatively rapid and regular service, essential to the stimulation of a dependable flow of commercial traffic which in its turn brought income’.37 These contracts in turn brought in other official business for stores, troops and emigrants. A further way in which the shipping companies restricted competition from foreign rivals in the sphere of colonial trade was by the system of ‘rings’ or ‘conferences’ that controlled rates and allocated business between national lines.38 The conference system was introduced to, among other places, Australia in 1884 and South Africa in 1886. A policy of ‘deferred rebates’ was offered to merchants who agreed to use its services exclusively – in South Africa this was 5 per cent of the freight paid.39 The conference system ensured that British lines had the right to carry all merchandise bound for the colonies from continental ports.
Why were British and dominion politicians prepared to tolerate such collusive arrangements between companies to pool capacity, and to fix freight rates and the number of sailings? The establishment of steamship services between Britain and its colonies provided the maritime foundation for the growth of overseas trade. By placing shipping companies on a more profitable basis, the conference system encouraged investment in services that might otherwise have remained irregular and inadequate. The conference system was not without its critics, however. By 1906 there were serious complaints against the working of the South African shipping ‘ring’, in particular. A Royal Commission reported in 1909 that the conference system was necessary and its practices justified. Three years later, the South African government finally moved to end the rebate system, albeit that the conference continued to exist; merchants agreed to carry on shipping their goods by conference lines and the lines in turn charged uniform rates previously agreed.40
37 A. N. Porter, Victorian Shipping, Business and Imperial Policy: Donald Currie, the Castle
Line and Southern Africa (Woodbridge: Royal Historical Society, 1986), p. 273.
38 P. N. Davies, ‘Shipping and Imperialism: The Case of British West Africa’, in G. Jackson
and D. M. Williams (eds.), Shipping, Technology and Imperialism (Aldershot: Scolar Press,
1996), pp. 46–63 (pp. 54–60).
39 A. W. Kircaldy, British Shipping: Its History, Organisation and Importance (London: Kegal
Paul, Trench, Trübner and Co., 1919), pp. 184–5.
40 Ibid., p. 198.
132A more direct source of advantage to British exporters to dominion markets came from the Crown Agents for the colonies. Like the Colonial Land and Emigration Commission (see Chapter 3), the Crown Agents were an ancillary administrative agency.41 Part of their function was to provide advice on financial legislation to the Colonial Office and the Treasury. They also helped the dominions (and Crown Colonies) to raise loans in the City (see Chapter 5). But their remit extended to commercial affairs, and they regularly executed major construction projects for the colonies. With responsibility for drawing up and supervising contracts for these projects, they purchased, inspected and shipped all the mater ials required. The settler colonies subsequently withdrew their patronage and established agencies of their own in London, so by 1880 the operations of the Crown Agents were mainly restricted to the dependent empire, although they continued to act for the Cape Colony, Natal, New Zealand, Western Australia, the Orange River Colony and the Transvaal on certain financial matters into the early twentieth century.
A major aspect of the public works supervised by the Crown Agents was the building of railways. In 1868 Queensland (a separate colony from 1859) decided to obtain its railway materials through the Crown Agents, and by the mid 1870s the Cape and Natal were doing likewise. The sheer volume of this work led to successive increases in the size of the Crown Agents’ Office and in their procurement activities.42 Here they enjoyed wide powers of discretion. They provided all of the materials and equipment necessary for the construction and maintenance of railways, obtaining supplies through their own list of approved firms. On receiving an order, the Crown Agents contacted one of these firms or solicited bids from several of them. Supplies ranged from engines, trucks and carriages to rails, bridges and workshop machinery, to lighting, cement and coal. The Agents looked either to firms already used extensively by English and Scottish railway engineers, or to firms that had a proven track record of working for colonial governments. This practice undoubtedly worked to the advantage of British manufacturers. Crown Agents also appointed the engineers, inspectors and staff who were involved in preparing designs and specifications, and in supervising the railway’s construction and subsequent operation; this again worked to the advantage of British firms.
Not surprisingly, charges of monopoly and accusations of favouritism were levelled at the Agents, especially from the companies that had failed to obtain concessions and contracts. But the policy of preferential
41 L. E. Davis and R. A. Huttenback, Mammon and the Pursuit of Empire: The Economics of
British Imperialism (Cambridge: Cambridge University Press, 1986), p. 13.
42 A. W. Abbott, A Short History of the Crown Agents and Their Office (London: The Crown
Agents, 1959), p. 23.
133Markets and consumer cultures purchasing was vigorously defended at the time, and has been since.43 The Agents, it is argued, had a wide range of contacts and experience through their work in building railways throughout the empire, from which the colonies stood to gain. The list of companies they utilised was extensive, and long-term business relationships were developed with them. Firms on the list had a good deal to gain by remaining in the Crown Agents’ favour, and there were remarkably few complaints about the quality of materials they supplied. The Agents, moreover, were not a profitmaking organisation, and economies of scale made their services cheap. Ultimately, the survival of the Agency depended on colonial satisfaction with the performance of its duties. There were significant strengths to the