AMERICA – Part 2 – The Road to Revolution

With the end of the French and Indian War in 1763 ( ) , the English were at peace for the first time in more than fifty years, but new problems awaited the British Crown. It was clear to British statesmen that the previous decade had been fraught with a number of vexing problems in trying to manage their vast and growing empire. Saddled with a national debt of approximately $175 million, on which the annual interest alone amounted to $ million, the English government desperately sought new sources of revenue. The colonies were the logical place to look for them. Yet, the experience of the French and Indian War made it clear that extracting money from the colonies would not be easy. The colonists were unwilling to allow Parliament to tax themk, and were reluctant to levy tases on themselves.

The problems of managing the Empire were compounded after the French and Indian War by a fundamental shift in imperial policy. In the past, the English government viewed the empire as a commercial venture and opposed the acquisition of territory for its own sake. After 1763, a number of English and colonial leaders argued that land itself was of value. Land could sustain a huge population, generate abundant revenue from taxes and other sources, and confer imperial splendor upon England itself.

The territory added to the British Empire as a result of the French and Indian War doubled its size. The difficulties of settling, administering, defending and governing these holdings were immensely complex. Unfortunately, the expansion of the British Empire took place in the context of a worsening debt crisis in England itself. Landowners and merchants staggered under burdensome tases, and objected to additional levies. Their resentment of the colonists deepened, for they believed that the colonists had contributed little to support a war fought largely for their benefit. They believed that only the imposition of taxes on the colonists could relieve the financial burdens of the empire.

George Grenville, the prime minister of England, like many of his fellow Englishmen believed that the colonies had been coddled for far too long. They should now be compelled to pay some of the costs of defending and administering the Empire, and he quickly moved to increase the authority of Parliament in the colonies. In 1764, Grenville announced the Sugar Act ( ) , which was to eliminate the illegal sugar trade between the colonies and the French and Spanish West Indies. In addition, the act provided for the establishment of vice-admiralty courts in America that would try accused smugglers and also discourage the possibility of having cases heard before sympathetic jurors of their peers. The Sugar Act also placed duties on imported sugar, coffee, indigo and wine.

In September, Parliament passed the Currency Act of 1764 ( ) , which effectively gave the British Empire control over currency in the colonies. Until this point, colonists only had access to currency through trade with the British Empire. Suffering from a shortage of hard currency, the colonists had created their own paper currency in the form of Bills of Credit, the value of which differed from one colony to another. British merchants and creditors did not like being paid in a currency that wasn’t based on any real value system and could easily depreciate in value. the Currency Act sought to protect them by making paper currency no longer valid for the payment of private debts.

In addition, colonial legislatures were ordered to withdraw all paper currency already in circulation within a reasonable period of time. The rationale for the Currency Act was to end inflation by reducing the money supply. Unfortunately, the colonies were in the midst of a severe depression, and limiting the amount of money available made a bad situation worse. Now colonists could not obtain the money needed to conduct business or to pay increased duties and taxes. In the colonists’ eyes, the British government appeared unconcerned about their economic welfare.

…to be continued with Part 3 – The Stamp Act Crisis


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