The economics of
the Atlantic World was the initial transition between Old World norms and the
modern economic system the world enjoys today. It was a bridge between what was
and what would be, providing a unique study on how the mindset of entire
nations changed towards a new order, in this case, a new economic order.
Hindsight is 20/20, and as the 16th century turned into the 17th
, and the 17th into the 18th, etc, the
ramifications of such changes were felt across every nation and the influence
the new trade order created was not always seen as positive as it is today.
Once
the world became a little smaller with the discovery of the New World, societal
norms began to change and the needs of the people were replaced with
wants. An economic model and its
connected culture are not mutually exclusive, and thus I will examine, and
show, how the economics of the Atlantic World planted the seeds for a global
consumer culture. I will explore the nature of consumerism within the Atlantic
World and the change that developed within European society because of it. By
the end of this discussion, I plan to show that intercontinental trade created
a consumer economy as well as illustrate how society and trade in the Atlantic World
were affected. I will also examine whether this effect was positive or negative
for society as a whole.
The Beginning
When looking into such a broad topic as
that of economics, the best way to approach it is to start from the
beginning. The essence of the consumer
culture did not merely explode onto the economic scene once the New World was
discovered, it was actually the reason it was discovered in the first place.
The voyages that changed the world were not looking for new lands but were on a
path to find an easier and faster passage to lands that were providing luxury
commodities. Faster trade routes equaled quicker profits. Spices from India and
porcelain from China, for example, were not essential to the lives of the
European nations, but they became an integral part of the population’s lives,
so much that expeditions were funded solely to gain luxury items quicker. Christopher Columbus and his fellow captains
may not have discovered a new route to the Indies, but they definitely opened
the flood gates of trade that ultimately ended in the
formation of the consumer culture and a shift in how societies viewed
commodities.
The birth of Atlantic Trade marked a
significant transition in the world of economics. Up until the discovery of the
New World, Europe had been operating on the feudal system; a system of
subsistence farming in which wealth was measured by land owned. The ruling
class and aristocracy rented the land to their subjects in return for their
commitment to work the land. Returns on labor in this system were low. Any
profits were reaped by the land owners and the lower-class laborers were left
to merely get by. Any concept of a consumer culture was clearly beyond the
grasp of most Europeans at the time.[1]
What began to develop at this time is
what history has come to know as mercantilism. While not an entirely cogent
concept at the time, and not entirely understood by those involved at the time,
European nations began to comprehend a change in the winds regarding feudalism.
The tenets of mercantilism were most concisely defined by the English merchant
Thomas Mun[2].
At its core, mercantilism centers around building economic trade factors in
favor of the host country in all possible ways. Some examples of this would be
not importing anything that can be domestically produced, to limit the export
of the nation’s gold and silver at all costs, and to maximize domestic export
to neighboring countries. As these factors were maximized by the countries
involved, it created jobs both domestically and overseas.
Initially, foreign goods were brought
into the European countries to satiate the curiosity of the aristocracy and
provide monetary support for the nation.
However, after the discovery of the New World and connections between
the Atlantic World were established, the cry for luxury goods was not just for
foreign commodities by Europeans, but European goods were sought after by their
own citizens as well. Long periods of time away from their home countries led
many explorers to want for the comforts of home, particularly the Spaniards[3].
Granted,
expeditions to the New World were not unique to Spain, England also followed
suit, but unlike the English, the Spaniards who traveled within the Atlantic
World did not fully adapt to the new ways that surrounded them. They continued
to coveted the luxuries of home. The Spaniards “yearned for their glasses of
wine, their oranges and other familiar fruits…they wanted the luxuries that
they had possessed, or at least coveted, at home…they wanted their traditional
staples…[and] the satisfaction of these wants would entail massive changes to
the economies they had inherited”[4]. Due
to the Spaniards initial inability to adapt, they unknowingly took the biggest
step that would change the economic circumstances of the world.
It
was during this period of the Atlantic World that economics as a
science/philosophy began to take shape. The seemingly benign “wants” of the
European people gave birth to what Adam Smith coined as the “invisible hand”. A
common talking point amongst open market economists, the invisible hand
represents the positive economic outcomes that results from everyone looking
out for their best interests. People are by their very nature selfish
individuals. When there is money to be made in any particular market, people
will act out in their own self-interest in order to profit. As Smith saw it,
there was a wholly unintended positive outcome of this natural selfishness. He
writes in his pivotal work An Inquiry
into the Nature and Causes of the Wealth of Nations[5],
“As every individual, therefore, endeavours as much as he can both to employ
his capital in the support of domestic industry, and so to direct that industry
that its produce may be of the greatest value… He generally, indeed, neither
intends to promote the public interest, nor knows how much he is promoting it…
he intends only his own gain, and he is in this… led by an invisible hand to
promote an end which was no part of his intention”[6].
On a
contemporary level, Smith’s writings fall into a philosophical debate between
libertarian capitalism versus progressive, guided capitalism. But that is not
the intent of bringing up Smith in this context. The purpose is to show the
observations that Smith made at the time regarding the changes taking place in
society. Mercantilism of the time was not guided in the way nations guide their
economies today. It was natural, it was visceral, and it produced grand
outcomes without the assistance of a grand orchestrator. The desire of
individuals and the desire of nations to profit from the treasures of the new
world, on a luxury as opposed to subsistence basis, laid the roots for a job
and goods market that left the feudal system in its grave.
The
Spaniards may have begun the demand for home goods, but certainly were not the
only ones to partake in such a consumer mindset. Over time, almost all involved
nations within the Atlantic World would submit to the profitability and allure
of consumerism. Africa experienced the demand for free labor, China for silver
and porcelain, India for cloth textiles, the Americas for sugar and rum, and
the European nations anything that would provide comfort abroad[7]. Although
not all of the aforementioned nations were directly connected to the triangular
shape of trade within the Atlantic World, all economies and cultures were
affected by the discoveries made by the early explorers. Together, the trade
for commodities between them “created a global commercial network in which
America and Africa supplied the bullion and foodstuffs to pay for Asian
commodities distributed largely in European ships”[8].
Ultimately, with the discovery of the New World, and later, with the
establishment of the wider Atlantic World, a global consumer economy arose.
Good or Bad?
In
order to fully understand how the mass change in economics affected the social
norms and culture of the involved nations it is prudent to look into a nation’s
outlook; for this, England is the society that will be used to understand the mindset
of citizens during this time. Overall, what people felt about the shift in
economics provide understanding in how the change evolved within the Atlantic
World, whether it was embraced or scorned. The luxury trade changed the fabric
of each society it set up shop within. English society may have been late to
the game when it came to falling into the luxury market due to their ability to
adapt to the New World better than the Spaniards[9],
but once they did, a social clash began.
Not
surprisingly there were separate feelings on whether the new infatuation with
luxury items was good for society or not. Those who did not care for such focus
on extravagance believed that the consumerist nature of trade people turned to
was “the mo[s]t[10]
de[s]tructive con[s]umption that can happen to a nation”[11]. In
a European culture dominated by religion and piety, there was a strong concern
over the introduction of such vice to the masses. The belief was that the luxury
items that swelled the ports and drove trade harder than the essential resources
corrupted the nation. As with any major change in society, cultural convulsions
were present and not all reactions were positive.
This view of the
corrupt nature of the luxury trade did not wane, but spread amongst the elites.
The royal authorities viewed these luxury commodities as a detriment, at least
until large amounts of money began to come into their coffers because of them[12]. Once
the financial prospects became clear, the philosophical invisible hand took
over and the elites moved towards profit, cultural convulsions be damned.
The perceived “necessity” of these luxury items had an influence on
slavery. In a trade system dominated by the basic tenets of supply and demand,
slavery became an integral part of the pricing scheme for these goods. Every
trip across the ocean involved a precise calculation of the costs in producing
desired goods and whether or not they can be sold at a reasonable price. Slave
labor simply could not be removed from the price calculations of many of the
popular consumables of the time such as sugar, tobacco, and cotton. As society
advanced from the renaissance period and began to look upon the slave trade
with more enlightened eyes, a drastic move against it could not be hastily made
without significant brushback from the economic forces already at play.
As I had mentioned earlier, what was at play was mercantilism, and the
force driving it was the invisible hand. While many people could look at
slavery and identify its moral repugnancy, everyone with a personal stake in
trade could see how their own bottom line would be influenced by its abolition
or curtailment. And of course there are the consumers themselves who would be
repulsed at the market when they suddenly had to pay two or three times the
cost for the same commodities. Such is the argument today with government
subsidies for oil companies. Most Americans can agree that we do not need to be
subsidizing opulently rich Middle Eastern oil conglomerates, but most
Americans’ activism would be heavily depressed upon experiencing the resulting
pain at the pump. Again, the invisible hand reveals self-interest as one of the
more influential forces at play.
Alexander Geddes represents such a dissenting voice against the
abolition of slavery, and he makes his case on the defense that self-interested
Britons would not be willing to dispense with their luxuries. In his 1792 work An
apology for slavery; or, six cogent arguments against the immediate abolition
of the slave trade[13],
speaking of luxuries, he notes that “at first, indeed, they are few, and easily
obtained: but, every indulgence begetting a new desire, they at length become
innumerable… What is worse, they become, in time, almost necessary: so that we
cannot conveniently dispense with them.”[14]
Geddes most prominently points out that “The question at issue then is, whether
or not six millions of White British people, to whom at least rum and sugar
have become a sort of necessary Luxury, should, contrary to the Laws of Luxury,
sacrifice the use of rum and sugar to the liberty of six thousand Black people
from the wilds of Africa?”[15]
Geddes’ comments might come across as crass when compared to our
contemporary views of human slavery, but it is indicative of the time in which
he lived and to the power of consumerism over everyone involved from
production, to shipping, to the end-market. In this manner, the consumer
culture that was being nurtured had a negative impact in that it created a
strong resistance to an abhorrent practice in human history, thus delaying its
abolition.
Additionally, the
demand for luxury items created an aura of corruption around the Atlantic World
and “there have been few [s]taples upon
the face of the globe, where the thir[s]t of wealth and plea[s]ure had united
more opulence and more corruption”[16].
This view of the luxury trade manifested itself within members of the societies
that the consumer nature touched. The consumer culture bore its way into the
societies that wanted for luxury and refinement, strangling out the more
pressing and vital nature of trade, which was to provide more resources for the
ever growing population within Europe.
However, the consumerist
mentality was not just seen as a seemingly temporary blight on society. There
were those who did not object to the growing trade of luxury items, which
included the elite once they realized the profit of such endeavors. It was not
only the elite who craved the luxuries the consumer mindset demanded; even the
common man believed “luxury
and [s]ome exces[s] may be profitable”[17],
allowing one to assume that the luxury commodities were no longer only
available to the elite, but had infiltrated the everyday lives of the common
man. These items created a richer society, reducing the gap between the
aristocracy and the rest of the population. To be clear, the “gap between the
rich and the poor” that we commonly refer to today was not disappearing. There
still existed distinct class lines between the aristocratic elites and common
laborers, but the common laborers were being pulled out of subsistence living
and into an existence of broader indulgence as a result of expanding trade and
the increased profits being reaped by common laborers thanks to their essential
involvement in the new economic system.
One of, if not
the greatest influences this new consumer culture had on European society was
its elimination of Malthusian checks on population. Thomas Malthus in his
pivotal work An Essay on the Principle of
Population[18]
theorized that populations would grow up until the point at which it exceeds its
agriculture outputs, and then any series of famines or diseases would ensue to
keep the population in check. In essence, the pre-consumerist revolution possessed
a society that was materialistically limited. The emergence of mercantilism led
to those self-interested individuals, and nations, pursuing trade in the most
profitable manner possible. If this involved expanding agriculture to meet
population demands or exporting foodstuffs in order to feed a nation willing to
pay for the import, then it would turn the Malthusian principle on its head.
And in fact, the Malthusian principle did in fact die out in its traditional
form as populations continued to grow far beyond Malthus’ original model. This
could not have been possible without a growing working class with incomes that
allowed them to indulge in consumables. Foodstuffs might fall into the category
of necessities and not luxurious consumer goods, but it can be argued that the
economic conditions allowing this import and export of foodstuffs would have
been nearly impossible without an existing array of trade arteries supporting
an overarching trade system of various goods. As Adam Smith put it,
“consumption is the sole end and purpose of both the fixed and circulating
capitals. It is this stock which feeds, clothes, and lodges the people. Their
riches or poverty depends upon the abundant or sparing supplies which those two
capitals can afford to the stock reserved for immediate consumption.”[19]
Conclusion
The commodities trade in luxury was far from temporary in the Atlantic
World. These “wants” for luxury items eventually became “needs” due to their incorporation
into the fabric of society. The people who once demanded these new luxury items
and foodstuffs eventually became so dependent on their constant availability that
life was not the same without them. They were in essence addicted. In Carole
Shammas’ own inquiry into the consumerist nature of the Atlantic World, she
points out that “these seemingly frivolous raw materials altered the dietary
habits of the Atlantic community and ultimately the world”[20].
Life without these goods was unimaginable, as they were no longer luxurious but
necessary in life. Luxury items had consumed the needs of the populations,
permanently establishing the consumer culture mentality. The title more
commonly ascribed to this period might be known as mercantilism, but at its
core it was an economy based on consumer demand and those willing to provide
for that demand.
The economic state of not only the Atlantic, but the world, changed due
to the introduction of luxury items into the marketplace. These commodities
connected societies in such a way that had never been done before, and
ultimately created the global economic system we know today. Without the
consumer culture, connections around the world would never have been, and the
societies would have remained constant and eventually stagnated. Furthering
this concept of connected societies was the connection of self-interested trade
enterprises who were unwilling to deal with the financial convulsions that
would stem from the loss of free slave labor.
The luxury trade pushed and moved the world, connecting what was once perceived
as fictional lands and people as foreign products gained domestic availability.
The world shrank significantly with the discovery of the New World, and even
more with the connective trade routes. Although there were some drawbacks and negative
opinions, the rise of the consumer culture within the Atlantic World ultimately
resulted in a positive outcome. Economies flourished, connections were made and
an understanding between cultures began. More importantly, it put an end to an
ebb and flow of populations that cut lives short and limited the abilities of
societies to leverage its populations for maximum output and development.
[1] Encyclopædia Britannica Online, s.
v. "feudalism", accessed July 09, 2012, http://www.britannica.com/EBchecked/topic/205583/feudalism.
[2]
Magnusson, L. Mercantilism: The Shaping of an Economic Language
Psychology Press, 1994. Google Scholar (Accessed 7/8/2012).
[3] Elliot,
John H. "Chapter 4: Exploiting American Resources" Empires of the
Atlantic World: Britain And Spain in America 1492-1830. New Haven, CT: Yale
University Press, 2006. 88-114. Print. Pg 103. Accessed from ASU. HST 498 Summer 2012, Week 2.
[4] Ibid, 89.
[5]
Smith, A. "The Wealth of Nations." 1776. Amherst, NY: Prometheus
Books (1991). Google Scholar (Accessed 7/3/2012).
[6]
Ibid, 593.
[7] Shammas,
Carole. "America, the Atlantic, and Global Consumer Demand,
1500-1800." OAH Magazine of History 19, no. 1, Martin Luther King,
Jr. (Jan., 2005): pp. 59-64. JSTOR (Accessed 7/2/2012).
[8]
Ibid, 61.
[9]
Elliot, 90.
[10] Brackets
have been inserted so as to make the reading and understanding of quotations
easier to understand, due to them originally being in an older form of English.
[11] Child,
J. A New Discourse of Trade... 1751. Google Scholar. (Accessed
6/28/2012). Pg 42.
[12]
Shammas, 60.
[13] Geddes,
A. An Apology for Slavery; Or, Six Cogent Arguments Against the Immediate
Abolition of the Slave-Trade printed for J. Johnson; and R. Faulder, 1792.
Google Scholar. (Accessed 6/28/2012).
[14] Ibid,
30.
[15][15]
Ibid, 31.
[16] Raynal, G. T. F. A Philosophical and
Political History of the Settlements and Trade of the Europeans in the East and
West Indies 1783. Google Scholar. (Accessed 6/28/2012). Pg. 340.
[17]
Child, xxvii.
[18]
Malthus, T. R. An Essay on the Principle of Population: Or, A View of
its Past and Present Effects on Human Happiness. 1789.London, Reeves and
Turner, 1888. Google Scholar (Accessed 7/3/2012).
[19]
Smith, 370.
[20]
Shammas, 60.
