South Carolina - Capitalism

If Barbados borrowed its technology from Brazil, why didn’t it also borrow the organization of production?

One answer is the logic of capitalism. It was in the interest of the shippers financing the introduction of sugar production into Barbados to sell as many things as possible to the growers. It was better to sell every farmer some rollers and a set of coppers than it was to sell to only the wealthiest. It was better to tell every farmer he should own slaves than it was for them to enter into shared labor partnerships or recruit cheaper indentured servants that arrived on competing English ships.

The more business transactions, the higher the profits for the Dutch West Indies Company and the merchant bankers in Amsterdam and London. Of course, the fact money had to be leant to finance the purchases, meant merchant bankers were only willing to support the most credit worthy. However, their agents in Bridgetown could always hold the promise of future loans to the poor to discourage them from considering other options.

If this sounds as cynical as the recent efforts by banks to sell and resell mortgages that would never be paid because the profits were in the trades, not the interest, it’s because both are the consequence of a system that values wealth from trade over that from production. And like our current financial crisis, the reasons for the Dutch behavior lay in its recent past.

When Isabella I of Castile married Ferdinand II of Aragon, they consolidated control over most of the Iberian peninsula. In the early years, the Dutch were more interested in competing in the East Indies with Portugal for the spice trade than they were in the New World ruled by Spain.

Ferdinand and Isabella’s daughter, Juana, married into the powerful Hapsburgs of Austria. Her son, Charles V, was Holy Roman Emperor when Martin Luther refused to rescind his 95 theses at the Diet of Worms in 1521. In 1549, Charles changed the status of the lowland provinces along the North Sea from dependencies of individual German princes into his personal domain. Since many supported the Reformation, they were drawn into conflict with Charles, who introduced the Inquisition to strengthen his position in the Seventeen Provinces.

The Protestant provinces rebelled against Charles’ son, Philip II, in 1581. In 1585 Alessandro Farnese seized their central city, Antwerp, and expelled the Protestants. His city of Genoa took over the banking system. The men with knowledge of sugar refining moved to Amsterdam, which became the new trade center.

Charles V had married his first cousin, the sister of the then king of Portugal. In 1581, the same year the Dutch rebelled, Philip inherited the Portuguese throne and banned the Dutch from their traditional trade with Brazil.

The Dutch were traders who had no choice but to exploit changes in market conditions. In 1621 the United Provinces didn’t renew their truce with Spain and instead chartered the Dutch West Indies Company. It immediately began attacking the Spanish controlled sugar lands of Brazil, finally taking power in Recife in 1629. Maurice of Nassau arrived as local governor in 1637. The next year, the company took Sno Paulo de Loanda, the Portugese slave trade center off the coast of Angola.

While the Dutch company put together the pieces to dominate the sugar and slave trades, it only had a few years to exploit its monopoly. The Portuguese regained their independence from Spain in 1640. The Brazilians evicted the Dutch in 1654. Oliver Cromwell passed the first Navigation Act in 1651 that forbade British colonies from using foreign, especially Dutch, carriers. Charles II issued his act in 1660, setting off trade wars between the major powers that destroyed Amsterdam’s monopoly on sugar refining.

It was in the twenty years between the time Portugal became independent and the accession of Charles II that the Dutch were able to develop Barbados as a new market for slaves and a new source for raw materials to feed their sugar refineries. After that, their ships only carried about five to six percent of the slaves.

Notes:
Emmer, Pieter C. The Dutch Slave Trade 1500-1850, 2006, reviewed for Institute of Historical Research website by J. L. Price.