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PART II. - Eli F. Heckscher, The Continental System: An Economic Interpretation 
The Continental System: An Economic Interpretation, ed. Harald Westergaard (Oxford: Clarendon Press, 1922).
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ORIGIN AND EXTERNAL COURSE OF THE CONTINENTAL SYSTEM
COMMERCIAL WAR BEFORE THE BERLIN DECREE
MILITARY WAR (1799-1802)
As everybody knows, the accession of Napoleon to power at the close of 1799 did not lead to general peace, certainly not to peace with Great Britain; and the tendencies which have been described above consequently continued on both sides. The principal novelty was an increased activity on the part of the neutrals, resulting in the organization of the League of Armed Neutrality in December, 1800, between Sweden, Denmark, and Russia, with Prussia as a somewhat reluctant fourth party. It was based on the same principles as the Armed Neutrality of 1780, but with further guaranties against capture under blockade, in the form of a provision for previous warning on the part of the war-ships on guard, and also of a prohibition against the searching of trading vessels under convoy. The impulse had been given by the fact that the Scandinavian convoys had been continued even after France had annulled the law of Nivôse in December 1799, as has already been mentioned; and consequently it is apparent that the new League was directed mainly against Great Britain. The consequence of this was a succession of encounters with British war-ships; and in September 1800 Great Britain was guilty of an act of unusually flagrant aggression, when British privateers just outside the port of Barcelona seized a Swedish vessel and, under the protection of its neutral flag, succeeded in capturing the Spanish ships lying there at anchor.
The League of the Neutrals thus became an extremely welcome moral and political support for Napoleon against Great Britain; and some of his earlier utterances concerning the cutting-off of the Continent from England are due to its short career. For instance, we have his pronouncement to his assistant, Roederer (December 1800), as to the necessity of 'blockading the English on their island' and 'turning to their confusion that insular position which causes their insolence, their wealth, and their supremacy'.1 Napoleon already posed as a champion of the freedom of the seas, and in a treaty with the United States, signed in 1800 and ratified in 1801, he laid down the same principles as had been championed by the Armed Neutrality. But, as is well known, the Armed Neutrality came to an end after some few months with the murder of the Czar Paul I and the Battle of the Baltic, in March and April 1801; and the only result of the action of the neutrals was an Anglo-Russian navigation convention (June 5/17 of the same year), with the belated and somewhat reluctant adhesion of Denmark and Sweden. By this convention Great Britain succeeded in establishing the principle that free ships should not make free goods, and that war-ships, but not privateers, should be allowed to search convoyed trading vessels, in return for the abandonment, in theory, of the paper blockade and for restrictions in the definition of contraband, which was further limited by an agreement with Sweden in 1803. Napoleon, however, followed up his plans of cutting off England in other quarters by means of what the English historian, Dr. Rose, making use of an expression of Napoleon himself, has called his 'coast system', that is to say, the adoption of the French policy of the 'nineties of excluding Great Britain from access to the mainland by making himself master of its coasts in some form or other. After Austria had concluded formal peace at Lunéville, in February 1801, therefore, first Naples and the Papal States, and later on in the year Great Britain's own ally, Portugal, had to acquiesce in the closing of their ports to the British.
This phase of the blockade policy came to an end fairly soon, however, owing to the fact that peace was at length concluded between Great Britain and France, namely, the preliminaries of London, in October 1801, and the formal Peace of Amiens, in March 1802.
PEACE OF AMIENS (1802)
But the Peace of Amiens turned out to be merely a brief and feverish pause in the world struggle; and all modern investigators would seem to agree that a principal cause, not to say the principal cause, of its short duration was the continuation of the commercial war after the close of the military war, which, we may remark in passing, is a significant experience for those who wish to form a picture of the future of Europe after the recent great trial of strength. Napoleon, on the whole, adhered to his old policy of prohibitions, acting under the pressure of the French industrialists, who, according to Mollien, had never been as bent on protection as then. Confiscations continued under the old prohibitory laws of the Revolution; and these tendencies were the more unwelcome to Great Britain because Napoleon, during the short period of peace, extended or maintained his power over great non-French regions, including Holland, Switzerland, and Piedmont. The efforts made by Great Britain to bring about a renewal of the Eden Treaty were doomed beforehand to fail, since nothing was further from Napoleon's thoughts. In 1806, when peace with Great Britain was again under discussion, he is said to have declared in the Conseil d'Etat that within forty-eight hours after its conclusion he intended 'to proscribe foreign goods and promulgate a French navigation act which should close the ports for all non-French vessels.... Even coal and English milords would be compelled to land under the French flag.'
As regards the question of the influence of French policy on the economic position of Great Britain during the peace interval, the idea has spread, on the great authority of Dr. Rose, that the peace meant a change for the worse; but this, as far as one can judge, is a mistake. During the year 1802 the export figures show a rise on all points, especially for the value of domestic goods and for the re-exports of foreign and colonial goods, which rose by 15 and 23 per cent., respectively, as compared with the year before; and at the same time a lively, though somewhat speculative, trade with North and South America began. But in 1803 a great relapse occurred all along the line, the figures for which fall not only below those for 1802, but also below those for the last years of the war; and it is conceivable that one might have seen in this an effect of the French restrictions and the increased possibility of competition from other countries, which in certain quarters had been expected to be a consequence of the restored freedom of the seas.2
In any case the result of the politico-economic strain—as of various purely political matters which have nothing to do with our problem—was the outbreak of war as early as May 1803; the trial of strength between Great Britain and France was now to proceed without interruption until Napoleon's fall, and in its course to give rise to the most unlimited development of the ideas which we have previously traced.3
At first the commercial war continued on both sides, in the main, under its old forms; and to certain details of it we shall have occasion to return later on. Immediately after the outbreak of the war (May 17, 1803) England seized all French and Dutch vessels lying in British ports. A month later (June 24) the neutral trade with enemy colonies was regulated on lines half-way between those of 1794 and 1798; and shortly afterwards (June 28 and July 26) there was taken what was at least for the moment the most effective of all the British measures, namely, the declaration that the mouths of the Elbe and the Weser were in state of blockade, whereby the entire trade of Hamburg and Bremen was cut off. Again in the following year (August 9, 1804) all French ports on the Channel and the North Sea were declared under blockade. The British measures of the next two years are distinctly more difficult to summarize, not only because of the varying conditions of war, but also because of the different tendencies among the leading English statesmen. On the whole, they applied partly to the colonial trade, particularly the trade of the Americans with the European mainland, and partly to the trade with the North Sea coast in general. The colonial trade with the Americans was made the object of sweeping restrictions in 1805, not, however, through new ordinances, but through a new interpretation of the law on the part of British courts. The North Sea coast was again treated in a greatly varying manner, inasmuch as the blockade of 1803 was annulled in the autumn of 1805 and was renewed in an extended form in April 1806, when it was applied also to the mouths of the Ems and Trave. On May 16 of the same year a double blockade was proclaimed, including, in the first place, a strict blockade of the coast between the mouth of the Seine and Ostend, and, in the second place, a less strict blockade of the rest of the coast between the mouth of the Seine and Ostend, and, in the second place, a less strict blockade of the rest of the coast between the Elbe and Brest. Neutral vessels, however, were allowed, under certain conditions, to put in at ports on the less strictly blockaded section. Finally, the blockade between the Elbe and the Ems was annulled on September 25, 1806. Of course, these wobbling measures could not fail to hit the towns of North Germany especially very hard; and their paper-blockade nature kept alive the unpopularity of British policy in naval warfare.4
Napoleon, on his part, had caused many thousands of Englishmen travelling in France to be arrested immediately after the outbreak of war, and shortly afterwards had extended this method of belligerency to Holland as well; and he now proceeded to more comprehensive measures in two different directions. The first was the exclusion of England from all connexion with the mainland, especially with the North Sea coast. For this purpose he occupied Hanover, which, as is well known, belonged to the British royal house, and from there he extended his repressive measures to the great centres of maritime trade, Hamburg and Bremen. His general, Mortier, received orders to seize all British ships, goods, and sailors that were to be found there. And although this measure failed, the French largely made themselves masters of British trade to these points, both in general by the occupation of Hanover, and in particular by the seizure of the little Hamburg district of Ritzebüttel, which included its outport, Cuxhaven, at the mouth of the Elbe. The first of the above-mentioned British declarations of blockade formed the answer to this; and the independence of the Hanse Towns was consequently subjected to new blows from both antagonists. In October 1804, for instance, Napoleon simply kidnapped the British envoy from Hamburg, that is to say, from neutral soil. Moreover, in the beginning of 1804 a double action was taken against the influx of British goods farther south. The imports through Emden, in Prussian East Friesland, up the Ems to the great market of Frankfurt-am-Main were barred by the occupation of the town of Meppen on the Ems; and at the same time large quantities of British goods were confiscated in the vassal state of Holland. In May 1805, Napoleon resolved to intervene against British goods in Holland by causing French patrols to confiscate them along the Dutch side of the frontier. This led the Dutch legislature, in order to prevent such high-handed procedure in the future, to pass a law prohibiting all intercourse with Great Britain, to order the confiscation of all vessels that came from there, to prohibit the importation of British goods, and also to declare certain kinds of goods to be ipso facto British, and finally to lay down a line of demarcation within which the storing of goods was forbidden. These measures undeniably in many respects presage the events of the following year.
Nevertheless, in the matter of the Continental blockade all these things bore the mark of mere skirmishes. Meanwhile, however, Napoleon had also taken up a second line, which demands greater attention, because this side of his policy was pursued to its final goal during the first years after the outbreak of war. The second line was confined, in the main, within the limits of French jurisdiction; and its object was to close the French market to British industrial products, and at times to colonial goods of British origin.
FRENCH CUSTOMS POLICY
As a link in his general colonial policy, which in the main,scrupulously followed the lines of the Old Colonial System, Napoleon had already in 1802, during the year of peace, fixed a customs tariff on colonial goods in such a way that the duties were 50 per cent. higher for almost all specified goods, and 100 per cent. higher for unspecified goods, imported from foreign colonies than on goods imported from French colonies (Thermidor 3, year X—July 22, 1802). In the new customs statute, which became a law immediately before the outbreak of war in 1803, this arrangement was kept practically unchanged; but a high duty (8 francs per kg.) was established on cotton goods, which, of course, was aimed at the British textile industry (Floréal 8, year XI—April 28, 1803). The outbreak of war immediately revived the old line of pure prohibition, well known from the days of the Convention and the Directory, against everything British (Messidor 1—June 20). Colonial goods and industrial products coming directly or indirectly from Great Britain or its colonies were to be confiscated, and neutral vessels had to furnish detailed French consular certificates showing that the goods were of innocent origin. Nevertheless, the characteristic concession was made that the master of a ship who, 'through forgetfulness of forms or in consequence of change of destination', failed to provide himself with such certificates, might nevertheless be allowed to discharge his cargo on condition that he took French goods of corresponding value in return freight—an idea which Napoleon was destined to develop strongly in his later policy. In the new customs statute of the following year, the principle of prohibition was retained. On the one side, it is true, it was made milder, among other things by conceding the right to import certain classes of goods in vessels clearing from ports that had no French commercial representative; but, on the other hand, it was made more strict by a further prohibition with a very wide range, namely, that vessels which had cleared from, or had unnecessarily put in at, a British port should not be admitted to French ports (Ventôse 22, year XII—March 13, 1804). This last regulation anticipated the great Berlin decree, which may be looked upon as the origin of the Continental System proper.
Nevertheless one may safely assume that the whole of this system of differentiation, with special prohibitions against British goods and vessels coming from Great Britain, was calculated to prove as impracticable at this time as it had in the preceding decade. Napoleon, therefore, quietly fell back on a policy of general prohibition which was not directed specifically against Great Britain, but struck at all non-French goods alike. In reality those measures which affected industrial products were felt most severely, not by Great Britain, but by her continental competitors, especially those in the then Duchy of Berg, or what is now the Ruhr district east of the Rhine. This was not the intended result, it is true, but it further strengthened the protection of French industry. The foundation was laid in the Customs Tariff of 1805, which substantially raised the duties on colonial goods and cotton goods (Pluviôse 17, year XIII—February 6, 1805), and the culmination was reached in two decrees issued in the early part of 1806 (February 22 and March 4). These decrees, which were incorporated in the great protectionist codification of the customs laws of the Empire on April 30 of the same year, developed tendencies in two directions. On the one side, there was an enormous increase in the customs rates on colonial goods, with substantially less distinction—in certain cases none at all—between French goods and foreign goods. This was manifestly connected with the fact that Napoleon, after the battle of Trafalgar, largely lost the power of communication with his colonies and had to take into account the fact that the colonial trade would fall more and more into the hands of the British. By way of example, we may observe that, while the customs rates on both brown sugar and coffee, as well as on cocoa, in 1802 and 1803 had been 50 and 75 francs per 100 kilograms for French and foreign goods, respectively, they now increased to 80 and 100 francs, respectively, for sugar, and to 75 and 100 francs, respectively, at first, and to 125 and 150 francs, respectively, later on, for coffee; for cocoa they increased at first to 95 and 120 francs and afterwards to 175 and 200 francs, respectively. Thus the rates amounted to three and a half times as much as they had been three years before. But all this was a trifle compared with the most striking rise of all in the customs rates, namely, on an industrial raw material of such fundamental importance as cotton. Having previously paid 1 to 3 francs per 100 kilograms, it was burdened in 1806 with a duty of no less than 60 francs, which, at a low estimate, was 10 per cent. of the value, though it is true that 50 francs were allowed as a drawback on exports of cotton manufactures. Most revolutionary of all seemed the simultaneous prohibition of the importation of cotton cloths, calicoes, and muslins in February 1806; and the prohibition was extended in April to certain other kinds of cotton cloth as well. Yet at this time cotton had already become an absolute necessity. In later years, at St. Helena, Napoleon made out that the Conseil d'État had shrunk from this project, but that he had forced his will through by quoting the authority of Oberkampf, the leading man in the French textile industry. Naturally, Napoleon had no difficulty in getting his support of a policy that protected his own particular industry. At the same time the importation of cotton twist (filés pour mèches) was forbidden; the customs duty on yarn was raised, especially for the lower numbers, i.e., the coarser qualities; and it was publicly stated that this article also would have been prohibited altogether if it had been thought possible to spin sufficiently high numbers in France.5
Southern Europe came under the same régime as early as 1806. In Italy, during that year, Napoleon pursued a policy which was intermediate between the earlier and the later French method. Thus in the Kingdom of Italy (North Italy), of which Napoleon was king, a number of articles, especially textile goods, were declared, in accordance with earlier examples, to be eo ipso British, and were consequently prohibited when they did not come from France—a declaration which in reality was directed principally against the continental rivals of France. On the other hand, in the Kingdom of Naples, which was ruled by Joseph Bonaparte, only really British goods were prohibited; but in addition all British property was seized. In the same year Switzerland was suddenly obliged to pass a law which, under severe penalties, prohibited all importation of British manufactures except cotton yarn. This was an act of retribution because Swiss merchants, in the weeks just prior to the transfer of the principality of Neuchatel to France, had been importing colonial goods and manufactures there and afterwards had been daring enough to complain when they were all confiscated by Napoleon.
By these measures Napoleon felt that he had effectively closed the French, Italian, and Swiss markets to British industry and trade; but it now remained to close the rest of the continental markets in the same way. In doing this he fell back, in reality, on the old policy of prohibition directed especially against England, though without giving up the French customs policy, which was prohibitive against all; on the contrary, the latter policy went hand in hand with the former throughout his period of rule. But it was to the measures directed exclusively against Great Britain that Napoleon himself gave the name of the Continental System.6
THE BERLIN DECREE
THE years 1803-6 were notoriously full of world-overturning events: Napoleon's preparation for a descent on England (1803-5); the foundation of the French Empire (May-December 1804); the formation of the Third Coalition against France and its defeat at Ulm and Austerlitz (October and December 1805); as an immediate sequel to this, the Peace of Pressburg, with the extension of the 'coast system' to the eastern shore of the Adriatic, but also the definitive overthrow of the French fleet at Trafalgar (October 21, 1805); and finally the formation of the Fourth Coalition and the crushing of Prussia at Jena and Auerstadt (October 14, 1806).
In the autumn of 1806, therefore, Napoleon's victory on the Continent was as complete as his defeat at sea. Consequently he was so far perfectly right when in later years he pointed to the battle of Jena as the natural antecedent to the execution of the Continental System, inasmuch as that battle placed into his hands the control of the Weser, Elbe, Trave, Oder, and all the coastline as far as the Vistula, although, naturally enough, he omitted to point to the battle of Trafalgar as a negatively operating factor.7 The great manifestation consisted in the Berlin decree, issued November 21, 1806, from the capital of the power that had been last and most thoroughly vanquished. The external occasion was Great Britain's recently mentioned blockade declaration of May 16 of the same year; but that was nothing more than a pretext. Sorel has brought to light some documents of July 1805, and February 1806, written by a certain Montgaillard, in which the Berlin decree is portended. In these documents there is the usual talk of how England is lost if it is only possible to enforce a prohibition of her industrial products in Europe, for to destroy her trade is to deal her a blow in the heart and to attack her alliances at the same time as her continental intrigues. But the idea that peace with the different powers would have as a necessary pre-condition the closing of all the ports of the mainland to the British was evidently very widespread, as can be seen from a contemporary utterance of French industrialists. And, indeed, even before the issue of the decree we find Napoleon, both in one of his army bulletins (October 23) and in a letter to his brother Joseph (November 16), speaking of the continental blockade as a matter of course. At the same time as this last letter, another letter was addressed to the commander of North Germany, Marshal Mortier, instructing him to close the Elbe 'hermetically', to confiscate all English goods, and even to arrest the English and Russian consuls at Hamburg.8 In every respect, therefore, the Berlin decree stands out as a culmination of earlier thoughts and measures, although, despite all this, it had the effect of a bomb, thanks to Napoleon's masterly capacity as a stage manager.
Like most of the measures of both parties, the Berlin decree purported to be a measure of reprisal rendered necessary by numerous aggressions of the adversary; but its regulations were nevertheless solemnly proclaimed as embodying 'the fundamental principles of the Empire', until England disavowed her false pretensions. In content the regulations, as is usual in French ordinances, are very clear, at least at first sight, although they were gradually to prove, intentionally or unintentionally, rather ambiguous. The preamble states: (1) that England does not acknowledge international law; (2) that she treats all enemy subjects as enemies (this is directed against her legislation against alien enemies); (3) that she extends the right of capture to merchant vessels and merchandise and private property; (4) that she extends the blockade to unfortified places (a reproach which forms a reminiscence of the siege character of a blockade) and to places where she has not a single ship of war; (5) that she uses the right of blockade with no other object than that of hampering intercourse between peoples and building up her own trade and industry on the ruins of the trade and industry of the Continent; (6) that trade in English goods involves complicity in her plans; (7) that her proceedings have benefited her at the expense of everybody else; (8) and, consequently, that retaliation is justifiable. It is further stated, therefore, that the Emperor intends to use her methods against her, and accordingly that the regulations will remain permanently in force until England has acknowledged that the law of war is the same by land and by sea and cannot be extended to private property and unarmed individuals, and that blockade shall be restricted to fortified places guarded by sufficient forces.
The fundamental regulations laid down on this basis fall into four categories. First, the British Isles are formally declared in a state of blockade, and all trade or communication with them is prohibited (Articles 1 and 2). Secondly, the decree turns against all British subjects in territories occupied by the French; they are declared to be prisoners of war, and all property belonging to them to be fair prize (Articles 3 and 4). Thirdly, war is made on all British goods; all trade in them is prohibited and all goods belonging to England or coming from her factories or her colonies are declared to be fair prize, half of their value to be used to indemnify merchants for British captures (Articles 5 and 6). Fourthly and lastly, every vessel coming direct from ports of Great Britain or her colonies, or calling at them after the proclamation of the decree, is refused access to any port on the Continent (Article 7).
What was left undecided was the question of procedure at sea. In later years (1810) Napoleon himself declared on two or three different occasions that the Berlin decree implied only 'continental blockade and not maritime blockade', and that it was not to be applied to the sea, that is, to lead to captures; but this only bears witness to that capacity of forgetfulness of which Napoleon was master on occasion. It is true that his naval minister, Admiral Decrès, in answer to a question from the American envoy, gave it as his opinion that a vessel could not be captured simply and solely because it was on its way to an English port. It is also true that captures or condemnations of captured or stranded vessels on the basis of the Berlin decree did not occur in 1806 or in the first seven months of 1807; and this caused shipping premiums to drop to 4 per cent. and in England formed the basis of the regular standing argument of the opposition against the government's measures of reprisal. But it is equally true that this state of affairs came to an end with a declaration made by Napoleon himself, after his return from Poland, and communicated to the Law Courts in September 1807; in point of fact, the practice had already been altered in August and consequently not, as Napoleon later gave out, by the new Milan decree of December 1807. The Emperor's exposition of the law states that English goods on board neutral vessels should be confiscated; and in practice the decree was interpreted in such a way that an enemy destination was sufficient ground for the condemnation of a vessel. For that matter, this was in full accord both with the principles of blockade and with the practice of the period of the Directory.9
Even after this interpretation, however, the Berlin decree was so much milder than the Nivôse law of 1798 that the occurrence of British goods at least did not occasion the condemnation of the vessel itself and the rest of its cargo.
From a formal point of view there are at the most two novelties in the regulations of the Berlin decree. The one is the declaration of blockade against the British Isles, which could scarcely have occurred to anybody except Napoleon at a time when not a single war-ship held the sea against the British. Its principal object, indeed, was to form an effective and grandiose gesture; and not without reason the famous British lawyer, Lord Erskine, could later (February 15, 1808) say in the House of Lords that Napoleon might just as well have declared the moon in a state of blockade.10 Presumably, however, Napoleon aimed not only at the theatrical effect, but also at reducing the British principle of a paper blockade to an absurdity. The second novelty was the treatment of British subjects and their property on the Continent. Like the former regulation, this came about as a continental parallel to the British system of capture at sea. Its practical effect, as far as one can judge, was restricted to the moment of proclamation, as the law took by surprise many Englishmen and their enterprises, especially in the German territories governed by Napoleon.
The epoch-making character of the Berlin decree, therefore, is scarcely due to either of these formally new regulations. What is important is the wide range which from the time of the Berlin decree was given to a whole series of measures which for a long time had been applied more or less sporadically. It was only now that it had become possible to elaborate the different methods of reprisal into a truly 'continental' system, that is, one embracing the whole, or nearly the whole, of the European mainland. And it was only now, too, that they were made the central point in the entire internal and external policy of France, around which everything else had to turn in an ever-increasing degree. It was only now that the idea was seriously taken up by a ruler and statesman who had the unique capacity and ruthless consistency which were the necessary prerequisites for transforming the plan from a mere visionary programme into a political reality. The interest surrounding the development of the Continental System, therefore, is connected with the fact that its idea now came to be followed up in deadly earnest, and that the entire content of the ideas was thereby given an opportunity to affect the life of Europe for better or for worse.
The content of this system should be sufficiently clear from what has already been said, but it may nevertheless be set forth here, when we are entering upon the further development of external events. As a declaration of blockade against Great Britain was little more than a theatrical gesture, and as Napoleon was almost entirely destitute of means to assert his will on the sea, the blockade had to be applied by land. This means that it was, and aimed at being, a self-blockade on the part of the Continent, just as had already been the case with the Directory's Nivôse law of 1798. With the object of preventing Great Britain from disposing of her goods on the Continent and thereby bringing her to her knees, the Continent itself was to renounce all importation of British goods and colonial wares, so far as the latter came from British colonies and British trade. The whole thing not only was, but was intended to be, a 'self-denying ordinance'. The privations to which the Continent was afterwards subjected were thus a designed effect of Napoleon's measures, and not at all the work of his enemy, who, on the contrary, devoted himself to relieving them, for the most part in principle and almost entirely in practice. Unless this starting-point, which to our way of thinking seems very paradoxical, is firmly grasped at the outset, the following development will appear inexplicable. To what extent Napoleon realized all the consequences of his measure, we have, it is true, no means of knowing; but evidence is not lacking that he was conscious of their main features. Even when he issued the decree concerning the closing of the Hanse Towns (December 3, 1806), he wrote to his brother Louis of Holland that the serious obstacles in the way of intercourse with England would 'undoubtedly injure Holland and France', but that they were necessary; and in a letter11 addressed to the same correspondent a few days later he says that the system would ruin the great commercial towns. Moreover, in connexion with the intensification of the system by the second Milan decree he wrote a year later (December 17, 1807) to the minister of the interior, Cretet, and ordered him to encourage capturing as 'the only means by which the requirements of the country could be supplied'. On the same occasion, also, his minister of finance, Gaudin, in a report written in connexion with the Milan decree, pointed out the injury inflicted by the system on the French industries, which had already found it difficult to obtain colonial raw materials; but he considered that the injury to England was yet greater owing to her greater dependence on industry and foreign trade.12
Admiral Mahan, in his somewhat harsh criticism of Napoleon's policy, condemns the Continental System on the ground that it injuriously affected the neutrals, who were especially indispensable to France because she herself was excluded from the sea. 'The neutral carrier,' he says, 'was the key of the position. He was, while the war lasted, essentially the enemy of Great Britain, who needed him little, and a friend of France, who needed him much.'13 This statement appears to involve the ignoring of all the motives behind this mode of warfare, the object of which was to conquer Great Britain economically; for that object Napoleon could never have attained by allowing neutral trade to continue. That Napoleon had to expect greater injury to Great Britain than to his own countries from the self-blockade of the Continent was a necessary consequence of the views which, as we have already seen, were common to him and his adversary; and from his standpoint, accordingly, the policy was sufficiently justified. Whether he and his opponents conceived the economic connexions aright, is quite another question, which belongs to a later chapter. It is a question, moreover, which can by no means be disposed of by a mere reference to his need of the help of the neutrals for supplies which he thought he could do without or replace from other sources.
Napoleon immediately proceeded to carry the Berlin decree into execution over as large a part of the Continent as possible. With significant openness one article incorporated in the decree itself (Article 10) instructed the French foreign minister to communicate it to the governments of Spain, Naples, Holland, and Etruria—all vassal states—and to the other allies of France; and a letter of the same day from the Emperor to Talleyrand prescribes practically the same course. But the decree was to have its first political effects in the Hanse Towns, where, as we know, the foundation had been laid long beforehand, and where what were really executive measures had been ordered before the publication of the decree.
The Hanse Towns, and especially Hamburg, were perhaps of all places in Europe the most decisive points for the success or failure of the Continental System. During the last years of the ancien régime the flourishing French trade in goods from the French West Indies had chiefly gone to the Hanse Towns, where the French colonial goods had largely squeezed out their competitors, so that the Hanse Towns during these years absolutely came first among all European countries in the export trade of France. But the revolutionary wars put a sudden stop to all this, and that, too, not only for France, but also for Holland, which was occupied by the French. This was undoubtedly due in part to the fact that the policy of the Directory against the neutrals prevented them from maintaining the trade relations now that France could no longer maintain them herself. It was now that Great Britain came to the fore as by far the most important purveyor of colonial goods and industrial products to the Hanse Towns, and through them not only to the whole of Germany, but also to great parts of the rest of the Continent. At the same time Great Britain, on her part, had good use for the corn and other agricultural produce which were foremost among North German exports through Bremen. It is true that the statistics of the period must be used with great caution, and the figures from different sources, even official ones, are often irreconcilable. In this case, however, the general tendency is unmistakable, and some data may therefore be given. In 1789 only 49 vessels of 7,250 tons in all went to England from Hamburg and Bremen; but in 1800 there were 500 vessels of 72,900 tons in all. That is to say, the traffic increased ten times over. The value of British exports there is said to have risen between 1792 and 1800 from £2,200,000 to £13,500,000; in fact, the British minister at Hamburg stated in 1807 that during the twelve preceding years the exports of colonial produce, East India goods, and British manufactures to the Hanse Towns amounted to an average of £10,000,000—a figure the significance of which is shown by the fact that the entire British exports in 1807 were estimated at only a little more than £50,000,000.
Alongside this trade with Great Britain, however, there arose in the 'nineties an extremely lively, sometimes highly speculative, commercial intercourse between the Hanse Towns and the United States, which during that period sold more goods to Germany than to the entire British Empire. So long as the trade could be carried on without any great amount of British interference, it must have been far more favourable for France and her allies than the British trade, inasmuch as the American trade consisted, on the one side, of the importation of the products of the French and Spanish West Indies, and, on the other, in the exportation of German industrial products, which even managed to compete successfully with British goods in the United States. But it was one of Napoleon's deeply-rooted ideas, and one which was soon to assume the solemn form of the decrees, that nearly all textile goods and some sorts of colonial goods were in reality English, howsoever they might be disguised, and that all goods of maritime trade were at least 'suspect'. Consequently, he felt that almost the entire maritime trade of the Hanse Towns was a vital English interest; and this was certainly the case, at least to a large, if not to a predominant, extent.
As early as November 19, 1806, two days before the issue of the Berlin decree, therefore, Marshal Mortier seized Hamburg without further ado; and two days later (November 21) French troops likewise occupied Bremen and the Weser down to its mouth. Meanwhile, Lübeck had been taken by force as early as November 6, after Blücher had thrown himself into the town with his Prussian troops. Acting in accordance with his instructions, Mortier immediately ordered in Hamburg a statement to be made out of all money and goods arising from trade connexions with England. And in a magniloquent diplomatic note to the Senate of Hamburg, Napoleon's notorious ex-secretary and then minister there, Bourrienne, a few days later (November 24) gave as a motive of the measure the Emperor's feeling of obligation 'to seek to safeguard the Continent against the misfortunes with which it is threatened' through the machinations of England, inasmuch as a large number of the inhabitants of Hamburg were notoriously devoted to England; and at the same time he emphasized the regulations of the Berlin decree. By an ordinance of December 2, and by letter after letter, Napoleon laid down, modified and intensified the customs cordon which was to be created along the entire North Sea coast and the river Elbe as far as Travemünde by a large military force operating in conjunction with the customs staff.14
BRITISH COUNTER-MEASURES AND FRENCH RETORT
POSSIBLE LINES OF BRITISH POLICY
THE immediate question, after the bomb which Napoleon had exploded, was what attitude Great Britain would assume toward the new blow directed against the very foundation of her trade and industry. We are confronted here with one of the points in the history of the Continental System which both at that time and later have been most often misunderstood.
Napoleon's intention was to strangle British trade with the Continent. The most natural counterblow of Great Britain in resisting this attempt at strangulation, and one in strict accord with the conceptions of those times, was to maintain the connexion with the Continent in every conceivable way. Nor is there any doubt that this was in reality the main line of action pursued by her, that is to say, chiefly by the British merchants and manufacturers. Consequently, the main economic conflict lay between the French measures of self-blockade and the British endeavours to break through that blockade. But the efforts of the British public authorities along this positive line, which was in reality the decisive one, were very much restricted by natural causes, over and above the extremely important fundamental condition created by the supremacy of the British fleet at sea. And with the usual inclination of mankind in the sphere of economics to attach too great importance to state measures and very little importance to the work of economic machinery itself, the main stress has been laid on obvious but in reality subordinate matters. It is by no means intended to follow the same course in this book; but what, from a deeper point of view, were the decisive matters on the British side do not belong—for reasons at which we have just hinted—to the external course of the Continental System and must therefore be left over for a later treatment.
It is true that one might regard one British measure as a positive counterblow, that is, an effort to compel the enemy, by economic or other pressure, to revoke his self-blockade decree. In form, indeed, this is what was attempted, inasmuch as all measures on both sides were represented as acts of reprisal, that is to say, as being caused by the aggressions of the enemy and as being intended to lead him into better ways. In the English official language the declared object was 'to restrain the violence of the enemy and to retort upon him the evils of his own injustice', as it was expressed in the Order in Council of January 7, 1807. And undoubtedly these declarations were in many cases seriously meant. But if such pressure was to be exerted in the sphere of economics, it almost necessarily had to take the opposite form to penetrating into the continental market: it had to be an effectual (i.e., import-preventing) blockade of the Continent. And this, as we well know, was just what people would not think of doing, for it would have implied, as was indeed said in Parliament, 'that France had shut the door against our commerce and that we had bolted it.'15 Although this idea came up time and again, everything else contributed to put these positive counter-measures aside: Napoleon's obstinacy, which held out small hopes of any change in his tactics; the slight prospects of giving any appreciable strength to such pressure; and the direct disadvantages thereof for Great Britain's own industrial life. As before, therefore, nothing more was possible than a mere gesture, which was contradicted by every detail of actual trade life.
But by the side not only of attempting to break through the blockade, but also of placing obstacles in the way of imports with the object of bringing economic pressure to bear, there was a third, a negative line, namely, to try to injure the trade of France and her allies in the same way as Napoleon had sought to injure that of Great Britain. In other words, it was intended to cut off their exports, and in that way, according to the then prevailing view, to undermine the possibility of their economic prosperity, just as Napoleon intended to do as regards England. It was 'the policy of commercial rivalry', as distinct from the policy of retaliation, to use Canning's expression. This could not create direct pressure, such as would compel the annulling of a self-blockade; but its purpose, here as on the opposite side, would have been a slow weakening of the enemy financially and economically. This third line, however, clearly led to measures quite different from those of the second line, that is to say, not to a cutting-off of the supplies of the Continent, but to an attack on the trade of the Continent, and especially on its exports.
This third line was, of course, quite in accordance with the general tendency we know, and to that extent had possibilities quite different from those of the second line. But the actual conditions strictly limited this third line too, in a way even more strictly than the former, simply because England's fourteen-year-old supremacy on the sea had not left much of the independent maritime trade with the Continent; and even during peace time, moreover, that trade had had nothing like the same importance for the continental states as British trade had for Great Britain. With these three lines, however, the possibilities of state counter-measures were all but exhausted. From this it follows that the political measures of Great Britain against Napoleon's Continental decree were not, as a whole, of primary importance for the issue of the economic trial of strength. In order to make the connexion clear, however, we must enter into a somewhat detailed study of the nature of British policy; and this is in every respect so peculiar and casts so much light on the driving forces, that such an investigation well repays itself, even apart from the international consequences of the British measures and reaction of these consequences on the economic conflict itself.
What was possible and remained to be done by means of state measures on the part of Great Britain had chiefly to do with colonial trade, and especially with the part played by the neutrals in that trade. In order that this may be comprehensible, however, it is necessary to turn back a little and glance at the connexion between the mainland of Europe and the colonies, especially the West Indies, during the war period down to 1807.16
COLONIAL CARRYING TRADE
The central point in the colonial trade at this time was formed by the West Indies, especially in their capacity as sugar producers; and among these the French and Spanish islands, especially Haiti and Cuba, were distinctly superior to the British islands, Jamaica, and the rest. The trade to the West Indian possessions of Napoleon and his Spanish ally, therefore, was regarded almost as the great prize of maritime commerce, which was sought after by the neutrals with the eager support of the European mother countries so long as they were powerless on the sea, while Great Britain wished to make use of her power to win this prize for herself. It is true that the foremost colony of all, Haiti, or, more correctly, its western or French third, St. Domingue, had suffered immensely from the many negro insurrections ever since the first years of the revolutionary wars; but sufficient was left to arouse the desire for gain. Furthermore, the remaining French colonies—Guadeloupe and Martinique in the West Indies, Guiana on the South American continent, Isle-de-France (now known as Mauritius) and Réunion and Senegal in Africa—were somewhat less damaged by the course of events during the war, while the Spanish possessions seem, on the evidence of outside witnesses, not to have suffered seriously. The country which lay handy to seize the trade with all these territories—which trade was jealously guarded in peace time—was clearly the United States. The latter had just begun its independent political existence and was seeking ways which might lead them away from the exclusive economic connexion with Great Britain that had been created and maintained during the colonial period. In this way there arose a triangular trade which was highly important for the Atlantic states of the American Union. Vessels proceeded with corn and timber to the French and Spanish West Indies, took on colonial goods there, especially sugar and coffee, which they conveyed to the European Continent, after which they returned, principally in ballast, but partly also with European industrial products. The balance of assets which the American merchants thus obtained on the Continent was used to liquidate the country's balance of liabilities to Great Britain for its textiles and iron goods, which continued to dominate the American market; but a considerable part of it was also re-exported to the rest of America, chiefly the French and Spanish West Indies themselves.
The whole of this trade was in conflict with the 'rule of 1756',17 and, therefore, could not be tolerated in principle by Great Britain. But as the rule was interpreted during the revolutionary wars proper by the great legal authority, the British Judge of Admiralty, Sir William Scott, afterwards Lord Stowell—still to-day the great name in the sphere of the law of war at sea—it offered various possibilities to the neutrals, and particularly to Americans. Especially in the famous case of the Immanuel (1799) he elaborated the idea, on the one hand, that the neutrals could make no claim whatever to trade with enemy colonies during war, because those colonies, owing to the Old Colonial System, had been as inaccessible to them before the war as if they had been situated in the moon, and had been thrown open to trade only through the British naval victories. But, on the other hand, he also emphasized the fact that these prohibitions on trade in the products of enemy colonies held good only so long as those products had not formed part of a neutral country's stock of goods; and this he developed further in the case of the Polly in the following year, to the effect that the evidence of such a 'neutralization' should consist in the unloading of the goods in a neutral port and there passing them through the customs. Such a demand for what was called a 'broken voyage' was not difficult to fulfil, so much the less because the geographical position of the West Indies made it possible, with very little loss of time, for a vessel to put in at an American mainland port, especially Charleston, South Carolina, on its way to Europe. It was undoubtedly with full intention that the American government facilitated the matter by granting permission that when the goods were passed through the customs payment should be made by bond, and that practically the whole of the duty, with a very small exception (3½ per cent.), should be paid back on re-export. Consequently, the customs' treatment furnished the smallest possible guaranty that the goods had passed into neutral trade. When the unloading of the goods was required, the vessels had the possibility of going to a ship-building port in New England and using the time for the completion of repairs while the cargo was being discharged and reloaded. The trip thus became a 'circuitous voyage'.
The result of this peculiar manipulation may be illustrated in many ways. During the years of war the foreign trade of the United States underwent an extraordinary increase, while in the short peace interval there was an immediate decline; and the character of the trade is shown by the quite unique excess of re-exports, i.e., the exports of foreign products. It is true that the figures are not in all respects above dispute, but they are sufficiently reliable to merit reproduction.
We see here how the exports of foreign goods jumped from almost nothing to amounts which, at the close of the 'nineties, far exceeded the exports of domestic goods, and then during the peace year 1802-3 fell to little more than one-fourth of the amount for the last war year, but immediately after the outbreak of the new war rose to nearly half as much again as the exports of domestic goods in 1806. The following figures (given by Mahan) showing the exports to Europe of the two most important West Indian products during the few typical war years and peace years are also highly illuminative.
It may also be of interest to form a more graphic picture of this trade than can be given by figures. A sketch by the American historian, Professor McMaster, gives a mere summary of the abundant data, based on proceedings in prize-court cases as found in Stephen's book to which we have so often had occasion to refer:
The merchant flag of every belligerent, save England, disappeared from the sea. France and Holland absolutely ceased to trade under their flags. Spain for a while continued to transport her specie and her bullion in her own ships, protected by her men-of-war. But this, too, she soon gave up, and by 1806 the dollars of Mexico and the ingots of Peru were brought to her shores in American bottoms. It was under our (the American) flag that the gum trade was carried on with Senegal, that the sugar trade was carried on with Cuba, that coffee was exported from Caracas, and hides and indigo from South America. From Vera Cruz, from Cartagena, from La Plata, from the French colonies in the Antilles, from Cayenne, from Dutch Guiana, from the isles of Mauritius and Réunion, from Batavia and Manila, great fleets of American merchantmen sailed to the United States, there to neutralize the voyage and then go on to Europe. They filled the warehouses at Cadiz and Antwerp to overflowing. They glutted the markets of Emden, Lisbon, Hamburg and Copenhagen with the produce of the West Indies and the fabrics of the East, and, bringing back the products of the looms and forges of Germany to the new world, drove out the manufactures of Yorkshire, Manchester and Birmingham.
It was not to be expected that the British would look upon this development with approval. It took from them the trade with the enemy colonies, conveyed the products of these colonies to the enemy mother countries or gave them profitable sales in neutral markets, and consequently subjected the goods of the British colonies to an unwelcome competition on the Continent and at the same time created a market in America for the industrial products of the Continent which competed with those of Great Britain herself. Moreover, the shipping of the neutrals was considered to cause an enviable activity in the enemy ports; and, finally, it was considered to increase Napoleon's military power by relieving him of the necessity of providing convoys, which would have been necessary if the connexions had been provided by the French mercantile marine, and also by freeing him from the cares of supplying his colonies. These last matters implied a situation which the British would certainly have deprecated for their own part and which was also anything but welcome to Napoleon himself; but the other aspects of the situation involved many things which were bound to tempt Great Britain to interfere.
However, the British measures against the colonial trade of the Americans were comparatively mild for several years after the draconic law of November 6, 1793, regarding the confiscation of all vessels carrying products of the French colonies or conveying supplies to them had been revoked within two months. The absence of consistently maintained blockade declarations against the enemy colonies is especially striking. The instructions of 1794, 1798, and 1803, which we have previously mentioned,18 aimed mainly at preventing only direct intercourse between the enemy mother countries and their colonies, and also, in the case of that of 1798, at drawing the trade through British ports. Beyond that, they wished to tolerate trade only in 'free goods', that is to say, goods which had passed into neutral hands. Thus the instructions of 1794 forbade direct intercourse between the port of an enemy colony and a European port, as well as trade in products which continued to be French property, while the instructions of 1798 allowed even direct intercourse with Europe provided a call was made at a European port belonging to Great Britain or the home country of the vessel. The instructions of 1803 introduced a certain modification of this, in that, curiously enough, a British port is no longer approved but only a port in the vessel's home country; and it is further laid down that the goods must belong to a citizen of the same country. Especially during the first years after the new outbreak of war in 1803 the treatment of the neutrals, both Americans and Danes, was unusually mild and their shipping was little disturbed. The number of captured vessels incorporated with the British merchant fleet was also smaller in the years 1803-6 than it was in the preceding or following years.19
The 'neutralization' of enemy property resulting from the trade war itself, as well as from Sir William Scott's exposition of the law, assumed enormous proportions; and Stephen's book is full of characteristic and well-documented examples of the extent to which the regulations were evaded. These evasions, the number of which was legion, aimed at showing both that the trip was really (bona fide) begun in a neutral (American) port and that the goods were neutral property. With the former object new ship's papers were procured in an American port, sometimes, indeed, a new crew; in fact, there were occasions when two vessels exchanged cargoes so that they might both truthfully say that the cargo had been taken aboard in a neutral port. Moreover, separate insurances were taken for each trip, and the import duty was paid in the fictitious manner previously indicated.20 With regard to the neutral ownership of the cargoes, the most grotesque situations arose. In this connexion an extract from Stephen's account, which is supported by references to the different legal cases, is well worth quoting:
Merchants who, immediately prior to the last war, were scarcely known, even in the obscure seaport towns at which they resided, have suddenly started up as sole owners of great numbers of ships, and sole proprietors of rich cargoes, which it would have alarmed the wealthiest merchants of Europe to hazard at once on the chance of a market, even in peaceable times. A man who, at the breaking out of the war, was a petty shoemaker in a small town of East Friesland, had, at one time, a hundred and fifty vessels navigating as his property, under Prussian colours... The cargoes of no less than five East Indians, all composed of the rich exports of Batavia, together with three of the ships, were contemporary purchases, on speculation, of a single house at Providence in Rhode Island, and were all bound, as asserted, to that American port; where, it is scarcely necessary to add, no demand for their cargoes existed.... Single ships have been found returning with bullion on board, to the value of from a hundred to a hundred and fifty thousand Spanish dollars, besides valuable cargoes of other colonial exports. Yet even these daring adventurers have been eclipsed. One neutral house has boldly contracted for all the merchandize of the Dutch East India Company at Batavia, amounting in value to no less than one million seven hundred thousand pounds sterling.
All this led, in the spring of 1805, to an alteration in the practice of the British law courts, which considerably damaged the possibilities of the American carrying trade. The highest British prize court, the Prize Appeal Court of the Privy Council, in the famous case of the ship Essex with its cargo from Barcelona to Salem, Massachusetts, and thence to Havana, declared both the vessel and the cargo forfeited, despite the fact that the latter had been unloaded and passed through the custom-house in the usual way in the American port (May 22). This precedent was immediately followed by two others in the Admiralty Court, whereby the intention of eluding the regulations was declared to be decisive as against the external criteria. At the same time the British went a more direct way to the end of obtaining control over the American colonies of the enemy, namely, by passing a series of laws which were promulgated in April and June 1805, and in July 1806. These were intended to encourage the importation of the products of those colonies either direct to England by licence or to the British West Indies, either to sixteen free ports established there or, with somewhat less liberty and on the basis of a licence, to other islands, with a somewhat varying right to be forwarded to the British home country. At the same time permission was given to send a return cargo from the British to the foreign colonies. To the sixteen free ports importation might be made in small vessels of any nationality whatsoever, that is to say, even of enemy nationality.21
This new application of the law as regards 'circuitous voyages' aroused a great deal of feeling in the United States, and in April 1806, led to an American counter-measure; and at the same time there were issued the British blockade declarations concerning the North Sea coast and the English Channel on which we have previously touched.22 The most important of these in all respects was the blockade which was proclaimed on May 16, 1806, on the initiative of the then British foreign secretary, the celebrated Whig politician, Charles James Fox. This created a strictly blockaded region between Ostend and the mouth of the Seine—that is to say, practically Havre—and also two less strictly blockaded regions to the north and to the south thereof—from Ostend to the Elbe and from the mouth of the Seine to Brest, respectively. Neutral vessels were conceded the right to call at the ports on the last two stretches, on condition that their goods were not contraband of war and did not belong to enemy subjects, and on the further condition that they had not been loaded in an enemy port and were not, to begin with, bound to such a port.
Like most of the British blockade regulations, this was very obscure; and it is not known to me how it was applied during the remainder of the year. Mahan's view that it liberated neutrals from the obligation laid down in the Essex case, honestly to import the goods of the enemy colonies before they were again exported to Europe, is not very satisfactory as an interpretation of the law;23 for the condition was absolutely binding by the 'rule of 1756', even irrespective of the question whether any blockade had been ordered, and consequently it could not be regarded as annulled by the fact that the blockade had been made less strict on certain stretches.
Both in Great Britain herself and also in America and on the Continent of Europe, indeed, these different British measures during the years 1805 and 1806, especially the new exposition of the law in the prize courts, were regarded as serious blows against the neutral carrying trade. But the American trade statistics given above24 do not point to this. On the contrary, they show a higher figure for exports of colonial goods during 1806 than during the year before or after; and the figures relating to captures do not show any considerable rise until the following year. It is possible, therefore, that in reality the application of the measures was such as Mahan has laid down. In any case, it may surely be considered clear that during 1806 Great Britain did not get rid of the neutral trade of which she disapproved or put an end to the advantages which, from a British point of view, this trade afforded to the enemy part of the Continent.
Then, at the close of the year, came Napoleon's Continental decree. Owing to the enormous emphasis with which it was proclaimed, as well as to the measures by which it was followed, this gave a tangible occasion for the discussion of new measures chiefly against the neutrals. The ministry which came to power in Great Britain after Pitt's death in January 1806, was under the leadership of Lord Grenville, who had for many years been Pitt's foreign secretary and fellow worker; and for the reason that it embraced many of the most gifted politicians in the country, it is known in history as the 'Ministry of All the Talents'. The foreign secretary at the start was Fox, the most Francophile of all British statesmen, and, after his death in the middle of September, the future leader of the Whig Party, the then Lord Howick, but better known under his later title of Earl Grey. This government was not inclined toward forcible measures; and the only British statesman after Pitt's death who was to some extent equal to Napoleon, but who did not belong to the Talents Ministry, namely, George Canning, somewhat later said disparagingly that the Grenville measures against the Berlin decree 'partook of all the bad qualities of half-measures'.25
FIRST ORDER IN COUNCIL (JANUARY 7, 1807)
However, Lord Howick's governmental measure turned out to be the first step in the British counteraction which was to occupy the thoughts of the whole world during the following five years. Like its successors, it assumed the form of a measure by the King in Council, without the co-operation of Parliament, and it was therefore, from the point of view of public law, an Order in Council. Hence, this term became afterwards in the popular mind almost a proper name for regulations of this kind. The first Order in Council was issued on January 7, 1807, or a month and a half after the Berlin decree.26 As a measure of reprisal against the Berlin decree and with the reference, previously quoted,27 to the necessity of 'restraining the violence of the enemy and to retort upon him the evils of his own injustice', trade between enemy ports was entirely forbidden, and also trade between other ports at which the Berlin decree prevented English ships from calling. The members of the Grenville government afterwards maintained that this was only an application of the 'rule of 1756', which included a prohibition of coasting trade along the territory of the enemy. But if that had been the case, there would have been no use of asserting an intention of reprisal; and the opponents of the government—e.g., Lord Eldon, the Lord Chancellor in the following Ministry—also observed that the order went outside the alleged principle, in that it prohibited, for instance, trade between French and Spanish ports. Trade between the enemy mother country and her colonies was forbidden as a matter of course, but this implied nothing new. On the other hand, as regards coasting trade proper, it was more difficult to get at than any other part of the enemy's shipping, a point to which the domestic opponents of the government did not fail to call attention. On March 17, 1807, in a communication to J. G. Rist, the Danish chargé d'affaires at London at the time, Lord Howick amplified this further by declaring that there was no objection to neutral vessels carrying cargo to an enemy port, thence going in ballast to another port, and then carrying cargo from this last port to the home country. It was just the flourishing Danish Mediterranean trade that was hit by the new law; but apart from that the importance of the measure can not be regarded as great, except that to a certain extent it compromised the Whig Party with regard to the justifiability of measures of reprisal, and so far rendered difficult their position with regard to the more comprehensive measures of their successors in the same direction.28
It was quite natural, therefore, that those who were in favour of more forcible measures on the part of the government, either against Napoleon or against the neutrals, were not satisfied with the January order. In this connexion we have first to think of Stephen and his supporters, who, according to the later evidence of his opponent, Brougham, constituted the great majority. It is true that Stephen's book had appeared as far back as the autumn of 1805, or more than a year before the issue of the Berlin decree; but there is nothing to indicate that either the man or his book had exerted any influence on the January order. The positive demands of Stephen are not quite clear, it is true; but in any case they can not be regarded as having been satisfied by the measure of the Grenville ministry. In many passages in his book Stephen assumes a negative attitude toward the thought of using the war as a pretext for commercial advantages, which he calls 'a morbid excess of sensibility to immediate commercial profit'; and as a warning example to his countrymen he mentions the action of the Dutch, during a siege, of selling powder to the enemy, whereby, he says, they 'preferred their trade to their political safety'. In accordance with this, he adopts for the most part a purely naval standpoint and urges that the neutrals, with very few exceptions, should be entirely prevented from dealing with enemy countries and in enemy goods, and especially with enemy colonies. In that way the enemy would be compelled to carry on his trade himself and to fetter his naval forces by convoying trading vessels and protecting his colonies and providing them with supplies; and by all these things the desired possibility of captures would also be secured to its fullest extent. Alongside all of this, however, we also find hints that more directly anticipate the following course of development, namely, that the goods of the enemy colonies might be conveyed to the British market and there taxed to such an extent as to prevent them from competing with those of the British colonies.
Stephen was closely connected with the English Tory politician, Spencer Perceval, who as prime minister was in company with Stephen at the time of his assassination by a lunatic in 1812; and it was from Perceval that there came the first positive criticism of the January regulations, viz., in the House of Commons on February 4, 1807. In his speech, too, we have the first complete explanation of the motives that lay behind the definitive Orders in Council; and to judge by the speech it would seem that the detailed framing of those orders was due less to Stephen than to Perceval. The latter clearly takes his stand, from the very first, on what we have designated above29 as the 'third line' of policy, namely, that of trade rivalry. After a criticism of the January regulations he comes to what he regards as two possible expedients for meeting the Berlin decree. The one would be 'to exclude certain necessary commerce' from the territory of the enemy. But if this leads us to expect a plea for an effective blockade, we are immediately disabused; for it refers to the importation of French and Spanish colonial goods into France, with the object of at least making them dearer and thus strengthening the competitive power of the British goods. The alternative expedient, and the one which was to acquire practical importance, consists in the previously treated 'third line', namely, to turn the measures of France against herself by the order 'that no goods should be carried to France except they first touched at a British port. They might be forced to be entered at the custom-house and a certain entry fee imposed, which would contribute to enhance the price and give a better sale in the foreign market to your own commodities.' It is scarcely necessary to point out how faithfully the previously traced economic tendency of maritime blockade is here expressed, with sales on the enemy market as a self-evident aim. The second of these concrete proposals is somewhat influenced by the instructions of 1798, which in their turn stand in a certain connexion with the entrepôt or 'old colonial' system.
Perceval's contribution to the discussion became of great practical importance owing to the fact that some few weeks later, in March 1807, the Grenville ministry resigned and was succeeded by a government with the Duke of Portland as a figurehead prime minister, Canning as foreign secretary, and Perceval himself as chancellor of the exchequer. The minister of finance soon found occasion to take up afresh the question of measures against the Berlin decree, and that occasion arose in the West Indian interest, which to some extent had also lain behind Stephen's action. A West Indian petition which had been presented to the House of Commons as early as February had been referred to a select committee, whose report was ordered to be printed in August. The report strongly emphasized the American trade between the enemy colonies and Europe as the cause of the fall in the price of sugar, and this was stated to have gone so far that it no longer covered even the expenses of cultivation except on the largest estates in the British West Indies. In the debate on this report Perceval promised a prompt treatment of the question. We may regard as a first step toward the fulfilment of this promise an Order in Council which was issued only a few days afterwards (August 19), whereby vessels sailing under the flags of Mecklenburg, Oldenburg, Papenburg, or Kniphausen were declared lawful prize if they touched at an enemy port unless they were going from or coming to a British port. As the colours of these somewhat dubious North German principalities were commonly used as neutral flags in the more risky cases, this measure implies a first application of the new principle to a part of the pretended neutral trade.30
ORDERS IN COUNCIL (NOVEMBER 11-DECEMBER 18, 1807)
The decisive step, however, was taken by three Orders in Council of November 11, 1807, supplemented by one of November 18, five of November 25, and one of December 18; and to these there were afterwards added further new ones, so that in the end the number of them amounted to no less than twentyfour. It is this system of ordinances, and especially the fundamental ordinance of November 11, that formed the foundation of British policy during the following period—in form, it is true, only until the spring of 1809, but in reality until the collapse of the Continental System. It is also these, and not the January ordinance, that are usually meant when reference is made to the Orders in Council. They were further supplemented in the spring of 1808 by no fewer than six less important statutes governing such points of the system as could not be put into execution without the consent of Parliament.31
It is truly anything but easy to explain the purport of this far-reaching complex of regulations. The Orders in Council, in particular, are marvels of obscurity and rambling. We find the same matter scattered over several ordinances, which seemed absolutely to contradict one another, of the same day or with only a few days' interval. This incomprehensibility not only holds good for the people of later generations, but also for the people of that time; and the fogginess of the regulations was a standing butt for the jeers of the opposition. Thus, Lord Grenville declared his belief that the very persons who drafted them had scarcely understood their content; and he also alleged that four points in the same ordinance contained four contradictions, and that he was not a little proud of having been able to understand the connexion at last.32 The often confused and mutually conflicting explanations of the ministers did not, as a rule, help to clear matters; and owing to the total lack of all special investigations, especially as to their connexion with general legislation regarding shipping and the colonies, certain points at the present time are not easy to interpret.33 But this does not apply to the general line of thought, which is quite clear; and the pretended object of the measures can be distinguished without any considerable difficulty from their real objects. The fundamental idea is to be found practically in the germ as early as Perceval's speech in February.
Seldom, however, has the contrast between the policy officially proclaimed and the policy actually pursued stood out in a more striking way than in the chief of the three Orders in Council of November 11, the one which can properly be called the blockade ordinance.34 After a declaration that the January ordinance had not attained its object, either of compelling the enemy to revoke his measure or of inducing the neutrals to take action to the same effect, this ordinance simply proceeds to copy the most important points of the Berlin decree. Thus not only all enemy countries with their colonies, but also all places from which the British flag is excluded (this last point has nothing corresponding to it in the blockade declaration of the Berlin decree), are declared to be subject to the same rule as if they were really blockaded in the strictest manner; and, further, all trade in their products is prohibited. Every vessel trading to those countries shall be fair prize, as well as its cargo and all goods coming from there.
But immediately following these draconic regulations are exceptions which entirely nullify the rule and make possible the very trade so rigorously prohibited. Out of alleged regard for the neutrals, in fact, it is declared that they shall still be allowed to provide themselves with colonial goods for their own consumption and even to carry on 'such trade with His Majesty's enemies as shall be carried on directly with the ports of His Majesty's dominions or of his allies'. And in this the true fundamental principle has found expression. Ignoring details, we may say that the real principal regulations, as distinct from the apparent ones, consists in permitting both direct trade between the home country of a neutral vessel and enemy colonies and also direct trade between the European British port and enemy ports. What is prohibited in the first place, therefore, is direct intercourse between the enemy colonies and their mother countries. But further, in the main, all direct intercourse between the enemy countries and other ports is prohibited, except when the 'other ports' are either European British ports or ports in the vessel's own country. That is to say, intercourse is also prohibited between enemy ports and neutral ports elsewhere than in the home country of the neutral vessels.
Thus the regulations left the intercourse of the neutrals, principally the Americans, with the enemy West Indian colonies so far undisturbed. But by preventing the American vessels from conveying the products of those colonies direct to any port on the European mainland, neutral or enemy, the Orders in Council practically cut them off from almost the whole trade with the enemy colonies, except in so far as they were willing to put in at a British port; for the intercourse which was still allowed between the enemy colonies and the United States itself was of no very great importance, the Union's requirements of West Indian products being quite insignificant. Consequently, we can not deny the existence of a certain amount of consistency in these measures, despite their seeming aimlessness; and this showed itself in a number of details.
The principal thing in all respects was the obligatory call at a British port. The intention of this regulation was presumably, above all, to raise the prices on the products of the enemy colonies and the enemy parts of the European mainland in all ports where they might compete with goods of Great Britain or her colonies.35 For this purpose it was laid down that both goods of enemy destination and goods of enemy origin, as well as goods which had been loaded in an enemy port, should be discharged on the arrival of the vessel at a British port. The only exceptions were corn, flour, and other unmanufactured natural produce brought direct from the producing country, where there was no competition with British goods, and where it was thought possible, without inconvenience, to show a certain consideration for the exportation by the United States of their own products, as opposed to their re-exportation of colonial goods. The whole of this exception, however, furnishes very significant evidence of the long distance that Great Britain had travelled from the temporary plan of 1793 to starve out the Continent.
When the goods were afterwards to be exported again, the majority of the foreign goods, but not the British colonial goods, nor the actual products of neutral countries just mentioned, were subjected to customs dues; and in complete accordance with the aim of the whole measure these duties attained a considerable height: for instance, for coffee, 28s. per cwt.; for brown sugar, 10s.; and for white sugar, 14s. At the prices then current these rates would seem to have corresponded to at least 20 or 30 per cent. of the value.36
What this meant for goods that had been brought under British control only by military pressure, appears from such a detail as the fact that a special provision in the most important of the statutes had to concede to the owner of the goods the right to allow them to be destroyed in port without duty.37 But besides this there were also certain restrictions in the right to re-export these goods at all, still without the slightest intention of cutting off the enemy's supplies, although it often might seem so, but only in the interests of commercial rivalry. The greatest relaxations, therefore, curious as it may seem, were made in the permission to export to European ports, inasmuch as everything might go there, even enemy property (to be distinguished, of course, from commodities of enemy origin); this was otherwise excluded from all toleration by reason of the British denial of the rule that 'free ships make free goods'. The reason, of course, was that British statesmen, as usual, wished to force upon a reluctant enemy goods via England. All British and East Indian commodities and captured goods were allowed to go to enemy colonies; and foreign goods imported to England might go there by a licence which would always still further increase their price; while, finally, other places, chiefly, of course, the British colonies, might not, without special licence, receive six kinds of goods that played a special part in the colonial trade, namely, sugar, coffee, wine, brandy, snuff, and cotton.38
But there were two commodities concerning which there arose a very vehement struggle, namely, raw cotton and cinchona bark, usually called Jesuit's bark. The former was naturally of the greatest importance in the continental industry that competed with the British, while the latter, as is well known, was a pièce de résistance in the older pharmacopoeia in all febrile maladies. After having originally thought of imposing an export duty on these goods too, the British government decided to prohibit their export. Here, at least, where an actual prohibition of export was created, one would expect to meet with an aim at the actual blockade of the Continent, which the opposition indeed often assumed, more or less bona fide, to be the real object of this measure. But, as a matter of fact, nothing was further from the thoughts of the government. Perceval, who in his capacity of chancellor of the exchequer introduced the bills on this subject, justified the prohibition on cinchona bark, it is true, by alleging that the greatest difficulties had already revealed themselves on the Continent, especially in Napoleon's armies, through the scarcity of medicaments, as was indeed shown by the fact that the price had increased sevenfold. But he went on immediately to say: 'The object of the prohibition in this instance was that it might ultimately be the means of introducing other articles into the Continent.' For these reasons the laws themselves authorized licences from the prohibitions, as Perceval again emphasized, in order to prevail on the enemy to receive British goods. 'There would be no difficulty,' he said, 'in obtaining any quantity of this article, the moment the enemy took off his prohibition from the importation of other articles.'39 Thus the competition point of view was the deciding factor all along the line.
But it remained to regulate the control by seeing that the vessels went as a matter of fact to the British ports; and the regulations on this subject were among those that attracted the greatest attention, although they are not of equal interest in principle. The commanders of British war-ships and privateers were instructed, before the new regulations became known, to warn vessels on the way to enemy or other forbidden ports, and also to order them to make their way to specially named ports. Vessels on their way to an American port which was not in their own country were to go to Halifax in Nova Scotia (which was also used for similar purposes during the recent war) or to a West Indian free port; vessels south of the Equator were to go to Ceylon, to St. Helena or the Cape of Good Hope; and vessels on their way to Europe, either to Gibraltar or to Malta or to any port in the British Isles.
In addition to all this, finally, there were pure measures of reprisal, framed according to their French counterparts. Trading vessels were to remain enemy property and to be confiscated as such, even if they were sold to neutrals; and what was the most unreasonable of all the regulations, the mere possession of a French certificate of origin as to the non-British nationality of the cargo was to involve the confiscation of both ship and cargo. On the other hand, since the lack of such certificates involved capture on the part of the French, a neutral vessel, at least if it did not sail under British convoy, had, according to this last regulation, no alternative between breaking the orders of one power or the other, with the consequent risk of capture from one side or the other, provided, it is well to remark, that they wished to act openly and honestly, which therefore was practically impossible. The only effect of all this was the establishment of a system of double ship's papers, which gradually attained an immense scope; and thus in reality the consequence was that the laws of both sides were broken.
In this multiplicity of regulations—which, however, have not by any means been fully reproduced here—the most prominent thing of all is the obligation to call at a British port, with the possibilities thereby created of controlling and rendering dearer enemy products, especially enemy colonial goods. In the course of time, too, the British ministers managed to find a comparatively clear expression of their ways of thinking in this respect. This was especially the case in almost identical utterances made in the spring of 1812 by three of the ministers. As formulated by Lord Bathurst, the president of the Board of Trade, that is to say, minister of commerce, it ran as follows: 'France by her decrees had resolved to abolish all trade with England: England said, in return, that France should then have no trade but with England.'40 This, of course, did away with the idea of blockade as such, and the licensing system took its place in the seat of honour, partly through the 'proviso' regulations of the ordinances themselves and partly through the licences expressly permitted in them.
This, however, was far from clear to everybody; nor was it approved by all to whom it was clear. Some of the home critics of the British government, somewhat later including Canning, who was a member of the government when the ordinances were issued but had to leave it in 1809, considered that they ought to be true to their alleged purpose of making the enemy feel the consequences of his own injustice and to that end cut off his supplies.41 But more numerous were those attacks of the opposition which blamed the government for its advertised intention, doing so under the unfounded assumption that it was sincere. These critics dwelt on the impossibility of starving out the Continent, the small extent to which a shortage of certain articles of luxury was felt, the encouragement to new branches of production and the invention of substitutes which such a blockade might introduce into the Continent, and all the consequent injury to British industry and British colonies. In point of fact, however, all this criticism did not apply to the Orders in Council as they worked and as they were intended to work, but to Napoleon's Continental System. To that extent, therefore, it implied a recognition of the appositeness of that system, which was certainly not the intention of the critics. The real character of the government policy did not, however, escape criticism altogether, as when Lord Grenville in one of his first discussions on the Orders in Council, in the House of Lords on February 15, 1808, declared that: 'This principle of forcing trade into our markets would have disgraced the darkest ages of monopoly.' On the whole, however, it may be said that the criticism, usually very much embittered, missed the true point of the policy of the government.42
TERRITORIAL EXPANSION OF THE CONTINENTAL SYSTEM (1807)
In order to make the connexion clear, the British counter-measures to the Berlin decree have been followed to the close of the year 1807, and even somewhat beyond. But on the Continent the year 1807 had been rich in tremendous events with far-reaching consequences for the Continental System. At Tilsit Napoleon had prevailed upon Russia to join the great policy of reprisals in the event of her failure to mediate a peace between Great Britain and France; and naturally enough she failed. The bombardment of Copenhagen—Canning's act of violence against Denmark, which, as we know,43 was quite superfluous—had thrown that country entirely into the hands of Napoleon and made its ruler, the Crown Prince Frederick, who shortly afterwards ascended the throne as Frederick VI, one of his few sincere allies. Meanwhile, Napoleon's own aggression against Portugal had put an end to the independence of that country after the royal family had fled to Brazil. The remaining states of Europe were either more or less purely subsidiary states to France, or at least had been so recently vanquished by Napoleon that they could not contemplate resisting the introduction of the Berlin decree. To the former category belonged the kingdoms of Italy (North Italy), Holland, and Naples, the Confederation of the Rhine, and in the main (for the present) Spain; to the latter, Prussia and Austria. Besides these, the kingdom of Etruria (Tuscany) was reduced to submission by military occupation and the other Italian territories by suitable pressure. Even Turkey bound herself to exclude British goods. In this connexion it was especially important that the great emporium of Leghorn was closed to the trade of England by the overthrow of the independence of Etruria. At the close of 1807, therefore, there was only one European state that openly refused to become a party to the Continental System; and that state was Sweden, the sole ally of Great Britain. Against her, accordingly, Russia, at the instigation of Napoleon, made the attack which was to end with the conquest of Finland and the deposition of Gustavus IV Adolphus. Thus during its very first year the Continental System attained a territorial range which far transcended even the boldest plans that had been formulated in the minds of its author's predecessors under the Convention and Directory, when they spoke of a blockade from the Tagus to the Elbe or from Gibraltar to Texel.
FIRST MILAN DECREE (Nov. 23, 1807)
At the same time Napoleon had laboured further at the internal structure of the system in forms which, in the main, belong to part III. After regulating in greater detail the treatment of British vessels and goods on the especially exposed coast-line of North Germany, he gave to certain provisions which applied to that coast validity for his own empire through the first Milan decree (November 23, 1807). This contained detailed regulations concerning the manner in which it was to be determined that vessels had called at a British port, concerning the confiscation of vessels and cargoes in this case (not merely their expulsion, as was prescribed in the Berlin decree), and concerning the certificates of origin previously mentioned touching the non-British provenience of goods.
SECOND MILAN DECREE (DEC. 17, 1807)
It was during his stay in the kingdom of Italy that Napoleon was informed of the British Orders in Council of November 11; and he seems to have been seized by a violent fit of anger, which found expression in the second of the fundamental laws of the Continental System, namely, the second Milan decree, issued on December 17, 1807. The part of the Orders in Council to which he especially devoted his attention was the in itself not very remarkable examination (the warning) by British war-ships; but of course he also took notice of the obligatory call in England and the duty on re-exports. He hurled out his decree as a measure of reprisal against the English government, 'which,' he said, 'assimilates its legislation to that of Algiers,' and applied it only against such nations as failed to compel England to respect their flags, and also, as usual, made it valid only so long as England continued to disregard international law (Article 4). Every vessel which submitted to any of the three regulations—examination, call in England, or paying duty there—was declared to be denationalized; it had forfeited the protection of its own flag and, from the view-point of French legislation, had become English property (Article 1), and had thus become lawful prize both in port and at sea (Article 2). The doubt which had hitherto prevailed concerning the application of the Continental System by sea was thereby removed. The real content of the Milan decree is simply the express and unrestricted extension of the system from the Continent to the sea, in so far as French privateers could make it effective there. This fact finds expression in the curious formula that the British Isles are now declared in blockade both by land and by sea; and every vessel on its way to or from an English port, or an English colonial port, or even a port occupied by England, are declared to be fair prize (Article 3). Moreover, by attaching these regulations in the first place to the examination, which the neutrals almost entirely lacked the power of preventing, and not only to the call in a British port, where a certain amount of independent will might perchance remain for the masters of neutral vessels, the Continental System had approached the Nivôse law of 1798 more closely than in its previous workings; that is to say, it had come to apply against neutral shipping as such. This was quite deliberate on the part of Napoleon; and from this point of time dates his view that there were no longer any neutrals, inasmuch as they were either, and as a rule, Englishmen in disguise, or, at all events, had made themselves the accomplices of the English by accommodating themselves to the Orders in Council. This construction put upon non-French shipping applied almost as a matter of course to vessels, not only from allied, but also from purely vassal powers. On the very same day that the Milan decree was issued, for instance, Napoleon gave orders to Decrès, his minister of the marine, to detain a Russian vessel—that is to say, a vessel belonging to an allied nation—which had arrived in the port of Morlaix in Brittany; and for this order he gave the truly Napoleonic justification that it was either really English—in which case it was condemned as a matter of course—or that it was really Russian, and in that case should be detained to prevent it from being taken by the English. Decrès was also charged to give orders to the same effect to all French ports concerning Danish, Dutch, Spanish, and all other vessels, and to investigate whether the regulations were similarly applied in the vassal states. On this basis Napoleon afterwards systematically built up his treatment of non-French vessels in the ports of France and its subsidiary states, with gradually more and more developed protectionist tendencies as against shipping which was not purely French.44
On the same day that the Milan decree was issued, Champagny, the foreign minister at the time, received orders to transmit it by a special courier to Holland, Spain, and Denmark, with the request that these nominally sovereign states should comply with (obtempérer à) it; and the continental powers immediately set to work to bring their legislation into accordance with the new decree of the master.45 Of greater interest than the details of this development, which becomes important only in connexion with the inquiry into the actual workings of the system, is the attitude assumed by the United States—at that time almost the only remaining neutral power—toward this blow directed by both the belligerents mainly against neutral trade. The highly instructive development of the American attitude toward the Continental System went on alongside the development of European affairs down to the practical collapse of the system in 1812. It will form the subject of the next chapter.
POLICY OF THE UNITED STATES
THE policy of the United States during the period of the Continental System is an example of the type which, in the course of an economic war to the knife, seeks to maintain neutrality to the uttermost and to take all the consequences of that attitude, without, it is true, the support of either external military power or an efficient internal administration.46 Down to the close of 1807 this policy brought with it a unique development of American shipping and foreign trade, especially the carrying trade. But when the commercial war became more intense in 1807, it made a complete right-about-face and led to the second great self-blockade caused by the Continental System; and finally, when this became quite untenable, it drove the American Union into the very war which its leading men had done everything in their power to avert.
The desire of the American statesmen for neutrality scarcely calls for any detailed explanation. The sympathies of the population were strongly divided between the combatants. Anglophiles predominated among the Federalists, who later developed into the Republican Party, while Francophiles pre-dominated among the opposite party, the Republicans, later known as Democrats. The Federalists dominated the commercial and sea-faring states of New England, while the main support of their antagonists lay in the agricultural states of the South. The latter party tended to get the upper hand, strongly supported, as it was, by President Jefferson in 1801-9, and again by President Madison in 1809-17, partly because of political tradition dating from the time when France co-operated in the American War of Independence, and partly because the conflicts of a neutral sea-faring nation must always be keenest with that combatant who commands the sea. The remarkable thing about the situation is that it was precisely those economic interests and those parts of the country for the defence of which the campaign of neutrality was carried to extremes, that were its most zealous opponents and did their utmost to prevent its efficacy. Nor did they hesitate to follow the same tactics even during the war to which the policy of neutrality led, just because the measures of neutrality had necessarily to be directed against the few remnants of international intercourse that the belligerents had left undisturbed. Both in this respect and in other respects the neutrals of our day have had something to learn from American developments.
The increased severity in the British treatment of neutrals, as we know, went back especially to the new interpretation of 'broken voyages' in the Essex case in the summer of 1805, and in April, 1806, it had occasioned the American counter-measure in the form of the Non-importation Act,47 which prohibited the importation, both from England and from other countries, of most of the main groups of British industrial products, excluding, however, cotton goods. But the American law did not enter into force until November 15, and was suspended at the close of the year, so that it turned out to be nothing more than a threat. The Berlin decree of November 21, 1806, immediately led the American envoy in Paris to address an inquiry to the French minister of the marine, Vice Admiral Decrès, as to the interpretation of the new law at sea. In the absence of the Emperor the answer was favourable,48 and consequently there was no immediate occasion for uneasiness on the part of America. On the contrary, there were complaints in England that the Americans were making common cause with Napoleon in order to supply France with the industrial products that she was otherwise wont to obtain from England. Nor was any great alteration made in this respect by the first British Order in Council of January, 1807, owing to its restricted range. Accordingly, during the greater part of the year 1807 American trade and shipping continued not merely to flourish, but even to grow, as is shown by the table previously printed.49 In reality, the year 1807 marked the high-water mark of the trade and navigation of the United States for a very long time to come.
But the turning-point was to be reached before the close of the year. The beginning was made with the authentic interpretation of the law which Napoleon, as the sole final authority, gave to his Berlin decree, whereby it came to apply also to the sea. Then followed the new British Orders in Council of November and Napoleon's Milan decree of December.
EMBARGO ACT (DECEMBER 22, 1807)
All this set going the great American series of counter-measures, which also, so far as they concerned Great Britain, were affected by the latest act of aggression, the so-called 'Chesapeake Affair' of June, 1807. A British man-of-war requested to be allowed to search the American frigate Chesapeake with the object of recapturing some alleged deserters from the British navy; and when the request was refused, as a matter of course, the British vessel opened fire, captured the American man-of-war, and took away four of the crew. To this was added the American annoyance at the British practice of impressing for naval service sailors on American trading vessels on the pretext that, having been born before the American states became independent, they were British subjects; and this, combined with the Chesapeake Affair, gave rise to a very pretty diplomatic conflict.
But what gave the principal impulse to the American commercial, or rather anti-commercial, intervention was not the measures of Great Britain, but rather those of France, that is to say, the new adaptation of the Berlin decree, which brought it about that a stranded American vessel, the Horizon, had that part of its cargo which was of British origin declared fair prize. However, the new Orders in Council were known in the United States (in fact, though not officially) when on December 22, 1807, Congress and the President enacted the Embargo Act,50 which is one of the most interesting legislative products of the period. As has already been indicated, it was a self-blockade of the purest water, but, unlike Napoleon's, an open and direct one. An embargo was laid on all vessels lying in American ports and bound for foreign ports. The only exceptions were foreign vessels, which were allowed to depart after being informed of the enactment of the law; and vessels in the American coasting trade were to give security that the cargo should be discharged in an American port. Almost at the same time the Non-importation Act, passed in the previous year against British goods, was put into force and excluded importation in foreign bottoms from the only power that was in a position to carry on trade by sea. Under the pressure of the unreasonable procedure of both the combatants, the American government thus sought to cut off at a blow the abnormally large trade and shipping that the United States had until then enjoyed. In principle the policy was impartial, inasmuch as it was intended, on the one hand, to deprive Great Britain of American cotton and grain, as well of sales on the American markets, and, on the other hand, to put an end to the colonial trade from which France and Spain and their colonies derived equal advantages, and also to the importation of the industrial products of the European Continent into America. Although the measure was thus indisputably two-sided, the simultaneous enforcement of the one-sided Non-importation Act gave the policy the appearance of being directed distinctly against Great Britain. That country, indeed, had touched on a particularly tender point by imposing duties on the goods which compulsorily passed through its territories, inasmuch as both the United States and the British opposition put it on a level with the taxation of American trade which in the preceding generation had given the final impulse to the Declaration of Independence by 'the old thirteen'.51
President Jefferson's motive seems to have been partly the bias of the plantation owners, emphasized by his physiocratic tendency toward regarding agriculture as the highest work of man and his grave distrust of everything which departed from agriculture. To begin with, at least, he undoubtedly considered, as the American historian, Channing, says, 'that to put an end to, let us say, three quarters of the commerce of the United States would be a blessing, albeit somewhat in disguise'.52 But evidently this, like most of the measures of the different powers in the commercial war, was also a measure of reprisal, an endeavour to compel the embittered belligerents to be reasonable. In fact, unlike the majority of their own measures, it was a sincere attempt in that direction. It seems also as if the Embargo Act was a means of saving the great American merchant fleet, the largest next to that of Great Britain, from the extinction which must otherwise have been the almost necessary consequence of the Berlin and Milan decrees and of the Orders in Council. Thus, for instance, a large ship-owner in Maryland stated that of fifteen vessels which he had dispatched during the bare four months between September 1 and the enactment of the Embargo Act, only three had arrived at their destination, while two had been captured by the French and the Spaniards, one had been seized at Hamburg, and nine had been taken to England.
However, it is rather an academic question what the effect of the Embargo Act would have been had it been obeyed, for nothing was further from reality. It makes an almost moving impression to see how one supplementary law after another, each more detailed and more draconic than the other, seeks to stop up the holes in the original law, which was very summary; but it has seldom been shown more distinctly that a constant succession of new laws on the same subject means a constant disobedience to the provisions of the law. As early as January 9, 1808, special enactments were made as to the security that coasting and fishing vessels would have to give, and it was declared that the exceptions made in the Embargo Act in favour of public armed vessels did not apply to privateers (chapter 8). On March 12, in the same year, foreign vessels also were required to give security to the extent of four times the value of vessel and cargo, or twice as much as for native vessels, that they would not sail to foreign ports; and for fishing vessels, a declaration was imposed under oath as to whether any of the catch had been sold during the trip. At the same time, however, the President was authorized, very imprudently, to grant vessels the right to go in ballast to foreign ports in order to fetch from there the property of American citizens, on giving a pledge to return with that property, and not to carry on any other trade, etc. (chapter 33). Still more forceful was the intervention a month and a half later by a law of April 25, which both forbade all loading of vessels except under the control of the authorities, and also in general terms forbade any vessel to depart, without the special permission of the President, to any United States port or district which was adjacent to foreign territory; and the customs staff was charged to take under their care any suspiciously large stocks of goods in such border regions. Further, the law gave to naval and customs vessels the right of search and authorized the customs staff, pending the President's decision, to detain vessels suspected of intending to break the law, and so on (chapter 66). Finally, on January 9, 1809, there was passed an Enforcement Act,53 which summoned all the weak public powers of the Union to compel obedience to the law. Thus the President was authorized to employ the fighting forces of the United States by land and sea and to hire the imposing number of thirty vessels for the purpose. At the same time all the previous laws were made more severe. Vehicles were also subjected to the embargo, in order to prevent the law from being circumvented by land routes; permission had to be obtained for the loading of vessels; and the right of the customs officials to refuse permission was extended to the right of ordering the discharge, in suspected cases, of goods already loaded, and also to take goods from vessels into their custody; and the surety deposited was raised to six times the value of the goods. Finally, the right to sail to foreign countries for American property was annulled.
These convulsive regulations give a kind of negative to the actual circumstances, which would seem to have been characterized by even more systematic transgressions of the law than generally occurred during that exceptionally lawless period. In Passamaquoddy Bay, on the borders of British North America, and on the St. Mary's River, which formed the boundary toward the still Spanish Florida, there were collected whole flotillas of American vessels, which, under the pretence of sea damage, put in with flour and fish at the ports of Nova Scotia and of the West Indian Islands, and gave the skippers' need of money to pay for repairs as an excuse that the cargoes had been sold there. This transfer of trade outside the territories of the Union went to the north, west, and south. Northward seven hundred sledges went back and forth between Montreal in Canada and the boundary of the State of Vermont; and at the same time great quantities of potash were imported into Quebec. That city and Halifax in Nova Scotia had halcyon days, the former having more shipping than the whole of the United States; and the British governor of Nova Scotia declared that the Embargo Act was 'well calculated to promote the true interests of His Majesty's American colonies', which, to say the least, was not its intention. In the West Indies, it is true, there appeared at first a serious shortage of foodstuffs and timber, accompanied by a great rise in prices; and the French islands never regained their former prosperity. But many circumstances contributed to this; and in the British West Indies the prices of grain sank again rapidly, and a number of American vessels went there, as also to Havana, where on one occasion, in 1808, there lay nearly a hundred at one time. On the cotton market at Charleston, where the law had evidently been effective in 1808, an agent stated that it had been broken every week since December of that year and January of 1809. Of course the right to sail for American property abroad was particularly abused, and was therefore finally cancelled. Five hundred and ninety vessels are said to have left under this pretext, and as a rule they stayed away, like the American tonnage which happened to be outside the limits of the United States when the law was passed, and which took very good care not to come again under their jurisdiction. On the other hand, of course, those vessels which remained at home in obedience to the law remained largely without employment. Admiral Mahan supposes that those that remained in the states were in the majority, although, on the other hand, the complaints about the sufferings that the law was alleged to cause gained in volume from the desire to make party capital out of the matter. That part of the trade which, as far as one can judge, was hit hardest was the export of raw materials to Europe, especially the export of raw cotton from the Southern States to England. Thus Liverpool received only 25,426 bags in 1808 as compared with 143,756 bags, or nearly six times as much, in 1807. Even that part of the British importation of raw materials which was not directly dependent on American supplies showed a great decline in 1808. This was presumably due to the general shortage of shipping that was a consequence of the withdrawal from traffic of a fairly large part of the second largest mercantile fleet in the world.54
In spite of the immense extent to which the law was disregarded, therefore, it would be an exaggeration to call the Embargo Act ineffective as a means of giving trouble to the belligerents. During the years 1808 and 1809 the British opposition never wearied of holding up to the government the disastrous consequences that its Orders in Council had had by giving rise to the Embargo Act, which had cut off both the supply of raw materials from the United States and, above all, the possibility of sales there. In accordance with the good old British parliamentary custom, they made the government responsible for all the maladies of the body politic, while the government, also in the usual stereotyped fashion, pictured the situation in as favourable a light as possible and ascribed the undeniable difficulties to other causes. Any inquiry of scientific value, however, must consider the course of economic development as a whole, and for this reason the question of the effects of the Continental System on the belligerents has been held over for separate treatment in the fourth part of this work. In any case, the difficulties accruing to Great Britain in consequence of the Embargo Act were not of such consequence as to lead its government in 1808 either to rescind the Orders in Council or even in the least degree to modify their application. On the contrary, Canning, as foreign secretary, conducted the almost continuous exchange of notes with an ironic superiority and a diplomatic skill which were calculated to irritate more and more the American government with its clumsier methods.55
BAYONNE DECREE (APRIL 17, 1808)
The American law had, if possible, still less effect, in the direction intended, on Napoleon's measures. Decrès's original uncertainty as to the scope of the Berlin decree had inspired the American government with what it somewhat vaguely called an assurance that the measures would not be applied against the United States; and this curious position was maintained by the Americans in the exchange of notes with Great Britain even after the Milan decree and its application should have definitely dissipated all such hopes. Like Great Britain, France was constantly capturing American vessels; and in so doing she behaved, if possible, in a still more violent manner than her adversary, especially by confiscating vessels simply and solely because they had been subjected to examination by British cruisers, a thing which they could not possibly have escaped. This interpretation was carried to such an extent, and with such disregard of actual conditions, that in 1808, for instance, an American brig was declared lawful prize because of the British examination, despite the fact that, immediately after the examination, it had endeavoured to flee from the British cruiser into the port of Bilbao, which belonged to Napoleon's ally, Spain, and had thus done its best to show its desire to stand well with the continental powers. As a matter of fact, Napoleon was so little inclined to except the United States from his proposition that neutrals did not exist, that with his usual ability to draw unexpected logical conclusions he managed to find in this very Embargo Act a justification for seizing all American vessels that arrived at French or 'allied' ports. In a letter addressed to his minister of finance, Gaudin, on April 17, 1808, he declared, in fact, that, as the government of the United States had laid an embargo on its vessels and resolved not to carry on foreign trade during the war, 'it is evident that all the vessels that say they come from America really come from England and that their papers are fictitious'; and consequently all American vessels that came to the ports of France, Holland, the Hanse Towns or Italy were to be seized.56 This was the Bayonne decree, and was all that the United States got out of France by the Embargo Act.
|FOREIGN TRADE OF THE UNITED STATES (1807-1817)|
|Year||Domestic goods||Foreign goods||Total||For home consumption||Total|
It is true that these figures have one great weakness, namely, that they seem not to pay any regard to smuggling. The enormous decline in exports and the very pronounced decline in imports shown in the year 1808, therefore, undoubtedly give an exaggerated notion of the effect of the Embargo Act, but picture quite correctly the almost complete disappearance of legitimate exports. Professor Channing's calculation that, as a whole, the exports diminished by 75 per cent. and the imports by 50 per cent., is probably too high, especially with regard to exports.67 For consonant with the facts as it may be, that the figures show a stronger decline for exports than for imports, the decrease of exports can hardly be as great as this hypothetical figure would seem to indicate. True, it was against American exports that both the Continental decrees, the Orders in Council, and the Embargo Act directed their blows with practical unanimity; but, on the other hand, it is to be observed that smuggling also directed its successful counter-action to the same point. The subsequent Non-intercourse Act marks a powerful improvement, as appears from the figures for 1809; and the law of 1810 makes the imports and exports for that year and the exports for 1811 still higher. But, for reasons previously given, the export has changed its character from the colonial carrying trade to the sale of the United States' own products. In 1812 began the war with Great Britain, which gradually led to the almost complete cessation of all American foreign trade, especially of all exports. Finally, the years 1815-17 show the restoration of peace conditions, and thereby provide a suitable background for the alterations of war time. Especially noteworthy, in comparison with the situation in 1807, are the low figures for re-exports, which are only a little higher in 1815-17 than under the Embargo Act of 1808. This brings out very clearly the war-time character of this trade.
It may also be of interest to see the development of one special line of this trade, namely, the imports of American cotton into Liverpool. The figures were as follows:68
|IMPORTATION OF AMERICAN COTTON INTO LIVERPOOL|
|Year||No. bags||Year||No. bags|
As is only natural, 1808, the year of the Embargo Act, stands lowest of the years before the war year 1813, while the Non-importation Act of 1811 also brings with it a heavy decline. The Non-intercourse Act of 1809, on the other hand, has no very strong repellent effect, although, of course, 1810, the only year with full freedom of trade, stands still higher. These figures, which presumably include smuggled goods, as well as lawful exports, thus confirm the preceding statements in all essentials.
THE CONTINENTAL SYSTEM IN EUROPE (1808-1812)
THE 'COAST SYSTEM'
DURING the years 1808-10 external political events in Europe were characterized by the steadily-continued extension of the 'coast system'. In the very first of these years occurred the formal incorporation of Etruria with the French Empire; and at the same time Rome was occupied by French troops, to be also incorporated in the following year together with the rest of the Papal States. By this means the Italian peninsula was completely subjected to the power of Napoleon; and of all that we now count as Italy, only Sicily and Sardinia succeeded in preserving their independence, thanks to the direct support of Great Britain. During 1809 the occupation of the coasts was followed up on the Balkan peninsula—a movement which had begun as early as the close of 1805 with the acquisition of Dalmatia and part of Istria. By the Peace of Vienna (Schönbrunn) Austria had now to cede, among other things, the rest of her coast, the remainder of Istria and Croatia; and the acquisitions of 1805 and 1809 were incorporated with France, like all the territories previously mentioned, under the name of the Illyrian Provinces. From the point of view of the Continental System, the most important thing about all this was that Napoleon's power was now extended to Trieste, which with some exaggeration might be called, after the incorporation of Leghorn, the Leipzig of South Europe.
DISAPPEARANCE OF THE FRENCH COLONIAL EMPIRE
As is well known, however, the year 1808 was a red-letter year in the history of the Continental System, and, for that matter, in the history of the great trial of strength as a whole. The change was exactly the reverse of that indicated by these new acquisitions, for the insurrection in Spain gave to events in the most western of the peninsulas of southern Europe exactly the opposite course to that in the two other peninsulas. The effect on the Continental System was brought about partly by military conditions, in that the coastal defence on the North Sea was weakened in respect of the forces required for the war in the Iberian peninsula; but the Spanish insurrection had a much larger bearing on the Continental System, through its consequences for colonial trade and for Napoleon's colonial empire. The German historian of Napoleon's colonial policy, Professor Roloff, has shown how decisively the events in Spain put an end to Napoleon's colonial plans, which had previously been built to a large extent on the Spanish possessions. From having been the basis for privateers against British trade, their passing into the hands of the enemy served as a weapon against the remains of the French colonies, which one after another fell into the hands of the British. In January 1809 French Guiana was taken; in April, Martinique; in July, what was originally the Spanish part of Haiti, Santo Domingo (the French part, St. Domingue, had already for seven years been in the hands of the insurrectionary negroes), and at the same time Senegal in Africa; in 1810 fell first Guadeloupe, the last French possession in America, and then the remaining African colonies, Isle-de-France (Mauritius) and Réunion. In the same year, it is true, Java had nominally passed to France through the annexation of its mother country, Holland; but this large island, too, fell finally into the hands of the British in September 1811. The doctrine that Napoleon had championed ever since the days of the Milan decree—though not, it is true, without some relapses—namely, that there were no neutrals and that all colonial goods were English, he had thus the doubtful pleasure of seeing stern reality confirming ex post facto. But evidently, on the other hand, this in a way increased the chances of the policy of 'conquering England by excess',69 and made him not less, but rather more, zealous to press ruthlessly through the continental self-blockade with all available means.
In Great Britain, however, in the course of 1809 expression was given to the prevailing belief in the relaxation of the pressure by a new Order in Council of April 26, which limited the blockade so as to include Holland as far as the Ems, France, with her colonies and the possessions dependent thereon, and North Italy as far as Pesaro and Orbitello, approximately including Tuscany, the old Etruria.70 The Orders in Council of November 11, 1807, were declared to be cancelled; but in reality their policy was continued without any change by the manner in which licences were granted. But a general optimism diffused itself in England during the course of 1809, thanks to the expansion of the colonial trade.
THE CONVULSIONS OF 1810
The year 1810, on the other hand, was to be a year of heavy ordeals for both the 'mighty opposites', and that, too, both politically and economically. Sweden, which had resisted the Continental System longer than any other mainland state, was compelled as early as January to bind herself by the Treaty of Paris to exclude British vessels and commodities, except salt—a merely verbal profession of no very great importance, it is true, as Admiral Saumarez with his British squadron maintained friendly intercourse with the country without a break, even after Sweden had been compelled, in November, to declare war on Great Britain. Consequently, a far greater change was effected by events on the North Sea coast, in that Napoleon became more and more convinced of the impossibility of compelling obedience to the self-blockade beyond the limits of his own direct authority. For this reason there followed in rapid succession, first, in March, the acquisition of southern Holland as far as the River Waal, then the incorporation of the whole of Holland in July, after Napoleon's brother Louis had abdicated and fled from the country, and finally, in December, the further annexation of the Hanse Towns, the coast of Hanover, which had formerly been assigned to the kingdom of Westphalia, the Ems department of the Grand Duchy of Berg, Lauenburg, and, after some hesitation, Oldenburg. The result of all this was that, at the turn of the year 1810-11, France extended along the whole of the North Sea coast and the Holstein border up to the Baltic at the mouth of the Trave. At the same time measures were being taken along the south coast of the Baltic by constantly more violent menaces against its three owners, that is, Prussia, helpless but bitterly hostile to Napoleon, Mecklenburg, and Sweden, as the possessor of Swedish Pomerania.
It was precisely in the Baltic, however, that there happened before the close of the year an altogether revolutionary event, the strongest possible external blow against the structure that was geographically almost completed, viz., the apostasy of Russia. This occurrence had many causes, but the opposition between the two Emperors became visible when the Emperor Alexander declined Napoleon's request in the autumn of 1810 to confiscate a large flotilla of commercial vessels trading in the Baltic under different neutral flags; and the final emancipation was marked by the famous customs ukase which Alexander issued on the last day of the year (December 19/31). In this document a clause about the destruction of prohibited goods was renewed after an interval of thirteen years, undoubtedly in imitation of Napoleon's own measures, to be mentioned presently. Nothing could have been more welcome to the French Emperor, if this had applied only to British goods; but now the clause worked exactly in the opposite direction. For some important imports, foremost among them wines, had to arrive by sea in order to be legal; and as French produce could come only by land, the blow struck at France herself. True, British goods were excluded, ipso facto, as coming from an enemy country. At the same time, however, American vessels were accorded preferential treatment; and as they were the disguise principally used by British shipping, the whole measure was rightly regarded by Napoleon as an informal manner of opening a door to the navigation of his enemy. To complete the picture, duties on the wines of France and her allies were increased to twice the amount levied upon those of South-eastern Europe.71
The order of Napoleon which received this unwelcome imitation was the Fontainebleau decree of October 1810, which prescribed the destruction of all English goods throughout the Continent. This formed the complement to the Trianon tariff of August of the same year, which, in contrast to this, admitted colonial goods, although only against enormous duties. Precisely at the time of this new turn in the Continental System, moreover, a serious crisis broke out in England and in France, and also in many other places; and the difficulties of Great Britain inspired Napoleon with stronger hopes than ever of attaining the object of his great system, regardless of the fact that the dislocation of French economic life was at least equally deep and far-reaching.
THE FINAL COLLAPSE
By the apostasy of Russia, however, the Continental System had lost one of its retaining walls; and in the course of 1811 the breach was more and more widened by Alexander's constantly more open favourable treatment of British shipping. Napoleon had to try to raise a new barrier along the western frontier of Russia toward Prussia, the Grand Duchy of Warsaw, and Austria, and to have recourse to still more active measures to bar the south coast of the Baltic, now that British ships had points d'appui on its east coast in addition to those they had had all the time among the Swedish skerries. The last step in this direction was taken by the occupation of Swedish Pomerania in January 1812; but the immediate effect of this was to cause Sweden openly to fall away. Meanwhile, the preparations for the great trial of strength with Russia afterwards made heavier and heavier demands on Napoleon's attention; and with the beginning of the Russian campaign the cordon was relaxed everywhere. After the retreat from Moscow, in the beginning of the year 1813, insurrections took place both on the North Sea coast and in the Ruhr district (the Grand Duchy of Berg), which, like the Hanse Towns, had been very badly treated. It is true that they were ruthlessly suppressed, and Napoleon, sometimes at least, adhered to his old idea that the Continental System had shaken the power of England. But in the rush of more pressing claims that now came upon him, it exceeded even Napoleon's ability to devote to the enforcement of the system the superhuman energy which, even under more favourable auspices, would have been necessary to prevent it from falling asunder. Moreover, the falling away of his compulsory allies cost the system its continental extension, so that even his sincere collaborator, Frederick VI of Denmark, took a cautious step backward; and with the advance of the allied armies into France there also followed whole swarms of forbidden goods. Finally, the Continental decrees were formally rescinded, immediately after Napoleon's abdication in April 1814. With that the system passed into the realms of history, not without dragging with it in its fall large parts of the new branches of production which were indebted to it for their existence.
But before that disintegration of the system which was visible from without and which was conditioned by external causes had had time to take effect, forces from within had appeared which made it a thing quite different from what had been originally intended. What has now been described, over and above the contents and significance of the foundational decrees, is merely the external political façade behind which the real machinery worked. It is the latter that is to be the subject of part III.
[1.] Sorel, L'Europe et la révolution française, vol. VI, pp. 22-3; Holm, Danmark-Norges Historie fra den store nordiske Krigs Slutning til Rigernes Adskillelse, 1720-1814 (Copenhagen, 1912), vol. VII, pt. I, pp. 42-3. Cf. also de Watteville, Souvenirs d'un douanier du Premier Empire (Boucher de Perthes), in Revue Napoléonienne (N.S., Rome, 1908), vol. II, p. 71.
[2.] The value of British exports in the years 1801-3 is shown by the following figures taken from Porter, The Progress of the Nation, p. 356.
|United Kingdom produce and manufacture||Foreign and colonial merchandise|
|Year||Real values||Official values||Official values|
The first column expresses the change in the value of the exports, while the other two express rather the change in their quantity. The figures in Hansard's Parliamentary Debates (vol. IX, app., cols. XV-XVi) differ somewhat from these, but show no divergence in their general tendency. Dr. Rose bases his conclusions on the shipping figures, which, however, according to his own statement, show a quite insignificant decline of 3-2 per cent., and, according to Porter's figures (pp. 397-8), even a slight rise of 6-5 per cent.
[3.] Rose, in Napoleonic Studies (London, 1904), pp. 173 et seq.; Sorel, op. cit., vol. VI, pp. 168, 190, 207, 211-12, 249-50; Levasseur, Histoire des classes ouvrières, &c., de 1789 à 1870, vol. 1, pp. 465-6; Pelet, Opinions de Napoléon sur divers sujets de politique et d'administration (Paris, 1833), pp. 238-9; Cunningham, The Growth of English Industry and Commerce in Modern Times (3d ed., Cambridge, 1903), pp. 675-6; Smart, Economic Annals of the Nineteenth Century, 1801-1820 (London, 1910), pp. 57, 72; Roloff, Die Kolonialpolitik Napoleons I, in Historische Bibliothek (Munich and Leipzig, 1899), vol. X, pp. 134 et seq.
[4.] G. F. & C. Martens, Nouveau recueil de traités (G&ouuml;ttingen, 1817), vol. I, pp. 433-9; Smart, op. cit., vol. I, pp. 70-1; Stephen, War in Disguise, p. 31.
[5.] The principal changes in French customs duties on colonial produce from 1802 to 1810 are tabulated in app. II, from which a better view of the situation may perhaps be obtained than from the enumeration in the text.
[6.] Bulletin des lois, &c., 3d ser., bull. 203, no. 1,849; bull. 276, no. 2,752; bull. 287, no. 2,822; bull. 353, no. 3,669; 4th ser., bull. 29, no. 483; bull. 74, no. 1,324; bull. 78, no. 1,371; bull. 89, no. 1,515; Wohlwill, Neuere Geschichte, &c., pp. 271 et seq.; Vogel, Die Hansestädte und die Kontinentalsperre, in Pfingsblatter des Hansischen Geschichtsvereins (Munich and Leipzig, 1913), vol. IX, pp. 12 et seq.; König, Die sächsische Baumwollenindustrie am Ende des vorigen Jahrhunderts und während der Kontinentalsperre, in Leipziger Studien auf dem Gebiete der Geschichte, 45th ser. (Leipzig, 1899), vol. III, pp. 30, 43-4; Legrand, La révolution française en Hollande (Paris, 1895), pp. 309, 311, 327, 353; de Cérenville, Le système continental et la Suisse, 1803-1813 (Lausanne, 1906), pp. 36 et seq.; Levasseur, Histoire des classes ouvrières, &c., de 1789 à 1870, vol. I, pp. 467 et seq., 422 note 4; Schmidt, Le Grandduché de Berg, pp. 333 et seq.; Roloff, op. cit., pp. 132, 205 et seq.; Darmstädter, Studien zur Wapoleonischen Wirtschaftspolitik, in Vierteljahrschrift für Social- und Wirtschaftsgeschichte (1905), vol. III, pp.122-3; Rambaud, Naples sous Joseph Bonaparte, 1806-1808 (Paris, 1911), p. 436.
[7.] Correspondence de Napoléon Ier, no. 16,127 (Jan. 10, 1810).
[8.] Sorel, op. cit., vol. VII, pp. 55, 104, 114; memorial printed in Tarle, 'Kontinental'naja blokada (Moscow, 1913), vol. I, p. 706; Correspondance, nos. 11,064, 11,271, 11,267, 11,283 (Berlin decree).
[9.] Correspondance, nos. 16,127, 17,014 (Jan. 10, Oct. 7, 1810); Hansard, vol. XIII, app., pp. xxxiii et seq.; Mahan, Influence of Sea Power, &c., vol. II, pp. 273, 281-2; cf. also p. 245; also, Sea Power in its Relations, &c., vol. I, pp. 143, 189 note 1.
[10.] Hansard, vol. X, p. 473.
[11.] Cited ante, p. 60.
[12.] Correspondance, nos. 11,378, 13,395; Servières, L'Allemagne française, &c., pp. 129-30.
[13.] Mahan, Influence of Sea Power, &c., vol. II, pp. 353 et seq.
[14.] Vogel, op. cit., pp. 4 et seq.; Tarle, Deutsch-französische Wirtschaftsbeziehungen zur napoleonischen Zeit, in Schmollers Jahrbuch für Gesetzgebung (1914), vol. XXXVIII, p. 679; Schäfer, Bremen und die Kontinentalsperre, in Hansische Geschichtsblätter (1914), vol. XX, p. 414 et seq.; Levasseur, Histoire du commerce de la France, vol. II, p. 19; Mahan, Influence of Sea Power, &c., vol. II, p. 251; Johnson and others, History of the Domestic and Foreign Commerce, &c., vol. II, pp. 20 et seq.
[15.] The expression was cited by Perceval in the House of Commons, Feb. 5, 1808. Hansard, vol. X, p. 328.
[16.] For the following account reference may be made, not only to the works previously cited, viz., those by Mahan, Roloff, Levasseur, Holm, Stephen (the quotation on p. 107 comes from his pp. 81-2), Johnson (from whom is taken the table on p. 103), and Martens, as well as to the Statutes at Large of the United Kingdom and Hansard's Parliamentary Debates, but also to J. B. McMaster's chapter in the Cambridge Modern History (Cambridge, 1903), vol. VII, pp. 323 et seq., and Channing, The Jeffersonian System, 1801-1811, in The American Nation: A History (New York and London, 1906), vol. XI, chs. 13-15. The quotation from McMaster on p. 104 is taken from his History of the People of the United States, vol. III, p. 225 (ap. Johnson, op. cit., vol. II, p. 28).
[17.] See p. 36.
[18.] See ante, pp. 45 and 81.
[19.] According to Porter (op. cit., p. 396), the number of ships captured and incorporated with the British mercantile fleet was as follows:
[20.] See ante, p. 103.
[21.] 45 Geo. III, cc. 34 & 57; 46 Geo. III, c. 111.
[22.] See ante, p. 81.
[23.] Mahan, Influence of Sea Power, &c., vol. II, pp. 269-70; also, Sea Power in its Relations, &c., vol. I, p. 108.
[24.] See ante, p. 103.
[25.] Hansard, vol. IX, p. 687 (June 30, 1807).
[26.] All these Orders in Council of 1807 are printed in Hansard, vol. X, pp. 126-48; but as some of them are not readily accessible outside of Great Britain, and as they are, moreover, very often incorrectly summarized, they are reproduced in app. I from Hansard.
[27.] See ante, p. 99.
[28.] Lord Eldon in the House of Lords, Feb. 15, 1808 (Hansard, vol. X, p. 475); Perceval in the House of Commons, Feb. 4, 1807 (Hansard, vol. VIII, p. 629). Lord Howick's declaration is given in Hansard, vol. X, pp. 402 et seq. Linvald, Bidrag til Oplysning om Danmark-Norges Handel og Skibsfart, 1800-1807, in Dansk Historisk Tidsskrift, VIII (1917), vol. VI, pp. 409, 433-4.
[29.] See ante, p. 99.
[30.] Lord Brougham, Life and Times of, written by himself (2d ed., London, 1871), vol. II, pp. 5, 7; Speeches of (Edinburgh, 1838), vol. I, p. 404; Stephen, War in Disguise, &c., pp. 38 et seq., 116 et seq., 163 et seq., 171; Hansard, vol. VIII, pp. 620-56; vol. IX, pp. 85-101, 1152-3; app. pp. lxxxi et seq.; Porter, op. cit., p. 379.
[31.] 48 Geo. III, co. 26, 28, 29, 33, 34 and 37.
[32.] Hansard, vol. X, pp. 482-3; vol. XII, p. 774.
[33.] The reader is here referred to the text of the Orders in Council in app. I.
[34.] See app. i, no. v.
[35.] Cf., for instance, the utterances of Lord Bathurst, the president of the Board of Trade, and Lord Hawkesbury (afterwards Lord Liverpool), the home secretary; in the House of Lords, Feb. 15, 1808 (Hansard, vol. X, pp. 471, 485).
[36.] The figures relating to prices will be found in Tooke, A History of Prices, &c., vol. II, pp. 398, 414.
[37.] 48 Geo. III, c. 26, s. 16 (the Principal 'Orders in Council Act'). Cf. Lord Erskine in the House of Lords, Mar. 8, 1808 (Hansard, vol. X, pp. 966-7).
[38.] This seems to the writer to be the only possible interpretation of the most obscure of all the ordinances, namely, the Order in Council of Nov. 25, 1807 (printed as no. IX in app. I), which is clearly the one alluded to by Grenville in his utterance previously cited (pp. 114-15), compared with the Order in Council of the same day (printed as no. X).
[39.] House of Commons, Feb. 22 and 24, Mar. 16, 1808 (Hansard, vol X, pp. 695-6, 728, 1168); 48 Geo. III, cc. 29, 33, 34.
[40.] House of Lords, Feb. 28, 1812. Hansard, vol. XXI, p. 1053. Almost to the same effect, of. Rose, vice president of the Board of Trade, in the House of Commons, Mar. 3, 1812, and Perceval on the same day and Apr. 17, 1812. Hansard, vol. XXI, pp. 1120, 1153; vol. XXII, p. 434. Cf. also, Lord Wellesley's utterance in 1811 (see below, p. 208).
[41.] See ante, p. 99.
[42.] The following are a few examples: First standpoint: Canning in the House of Commons, Mar. 3, 1812 (Hansard, vol. XXI, p. 1147); Lord Sidmouth, the former and far from eminent prime minister under the name of Addington, in the House of Lords, Feb. 17, 1809, and Feb. 28, 1812 (Hansard, vol. XII, pp. 791-2; vol. XXI, p. 1071). Second standpoint: Lord Auckland, president of the Board of Trade in 'All the Talents' and in his time the eponymous negotiator of the Eden Treaty, in the House of Lords, Feb. 15, 1808 (Hansard, vol. X, p. 468); Lord Henry Petty, chancellor of the exchequer in 'All the Talents' and afterwards Lord Lansdowne, in the House of Commons, Feb. 18, 1808 (Hansard, vol. X, p. 682); Whitbread, one of the principal speakers of the Opposition, in the House of Commons, Mar. 6, 1809 (Hansard, vol. XII, pp. 1167-8). Third standpoint: Lord Grenville, as above (Hansard, vol. X, p. 483). Cf. the more perspicacious criticism of Lord Grey, formerly Lord Howick, in the House of Lords, June 13, 1810 (Hansard, vol. XVII, pp. 545 et seq).
[43.] For the Scandinavian investigations the reader is referred to the leading authority on Danish history in the eighteenth and early nineteenth centuries, Professor Edvard Holm, Danmark-Norges Historie fra 1720 til 1814, vol. VII.
[44.] First Milan decree: Bulletin des lois, &c., 4th ser., bull 172, no. 2,912. Second Milan decree: Correspondance, no. 13,391; cf. also, Napoleon to Champagny, Jan. 10, 1810, no. 16,127; also, Napoleon to Decrès, no. 13,398.
[45.] Correspondance, no. 13,393; Martens, Nouveau recueil, &c., vol. I, pp. 458 et seq.
[46.] The best survey of American developments in this field is to be found in Mahan, Sea Power in its Relations, &c., vol. I, ch. IV. Diplomatic correspondence and other relevant matter is to be found in Hansard, as well as in The Statutes at Large of the United States of America.
[47.] United States Statutes at Large, vol. II, p. 379.
[48.] See ante, p. 91.
[49.] See ante, p. 103.
[50.] United States Statutes at Large, vol. II, p. 451.
[51.] Cf. Lord Grenville in the House of Lords, Feb. 17, 1809. Hansard, vol. XII, p. 774.
[52.] Channing, op. cit., vol. XII, p. 201-2.
[53.] United States Statutes at Large, vol. II, p. 506.
[54.] Cf. also, Mahan, Sea Power in its Relations, &c.; Channing, op. cit., vol. XII, pp. 216 et seq.; Roloff, op. cit., p. 207; Lord Grenville in the House of Lords, Feb. 17, 1809, and Whitbread in the House of Commons, Mar. 6, 1809 (Hansard, vol. XII, pp. 780, 1167); Tooke, op. cit., vol. II, p. 391 (table); Daniels, American Cotton Trade with Liverpool under the Embargo and Non-intercourse Acts, in American Historical Review (1915-16), vol. XXI, pp. 278, 280; Sears, British Industry and the American Embargo, in Quarterly Journal of Economics, (1919-20), vol. XXXIV, pp. 88 et seq. Cf. also, vol. XXXV, 1920-21, pp. 345 et seq.).
[55.] The most important debates on this subject were in the House of Lords on Mar. 8, 1808, and Feb. 17, 1809, and in the House of Commons on Mar. 6, 1809. For the diplomatic correspondence, cf. Hansard, vol. XII, pp. 241 et seq.; vol. XIII, app.; vol. XIV, pp. 881 et seq.; vol. XVII, app.
[56.] Correspondance, no. 13,753
[57.] United States Statutes at Large, vol. II, p. 528.
[58.] Vogel, op. cit., p. 36; Rubin, 1807-1814, Studier til Københavns og Danmarks Historie (Copenhagen, 1892), pp. 381-2; Bergwall, Historisk under ättelse om staden Götheborgs betydligaste varu-utskeppningar (Gothenburg, 1820), p. 9 note; Daniels, loc. cit., p. 281.
[59.] United States Statutes at Large, vol. II, p. 605.
[60.] Correspondence, nos. 16,080, 16,127, 16,384, 16,736, 16,743; Bulletin des lois, &c., 4th ser., bull. 286, no. 5,402. Memoirs and Correspondence of Lord Wellesley (Pearce ed., London, 1846), vol. III, pp. 116-17, 134 (here, too, can be found the correspondence of 1810-11 between Wellesley, in his capacity as British foreign secretary, and the American minister in London); Le Moniteur, Aug. 9 and Dec. 25, 1810.
[61.] Napoleon to Eugene, Viceroy of Italy, Sept. 19, 1810, and to Champagny, Dec. 13, 1810 (Correspondence, nos. 16,930, 17,206); decree of Nov. 1, 1810 (Bulletin des lois, &c., 4th ser., bull. 324, no. 6,067; Martens, Nouveau recueil, &c., vol. I, pp. 527-8).
[62.] United States Statutes at Large, vol. II, p. 651.
[63.] House of Commons, Apr. 27, 1812 (Hansard, vol. XXII, p. 1061).
[64.] Correspondance, nos. 17,482 and 17,669. For the speech to the deputies of the Chamber of Commerce, of. Thiers, Histoire du Consulat et de l'Empire (Paris, 1856), vol. XIII, pp. 27 et seq.
[65.] For the documents issued by Maret and the British Prince Regent, of. Martens, Nouveau recueil, &c., vol. I, pp. 530 et seq,, 542 et seq. For the revocation of the Orders in Council, cf. Hansard, vol. XXII, pp. 853 et seq. (under an incorrect date), and vol. XXIII, pp. 716 et seq. For the debates on the subject in the House of Commons on May 22, 25, 26, and June 16, 19, 23, and in the House of Lords on June 18, 1812, cf. Hansard, vol. XXIII, pp. 286 et seq., 295 et seq., 486 et seq., 496-7, 587 et seq., 600 et seq., 715 et seq. See also Mahan, Sea Power in its Relations, &c., vol. I, pp. 266-76.
[66.] [The text of this footnote, on p. 146 of the 1922 edition, is missing.—Econlib Editor]
[67.] Channing, op. cit., p. 228.
[68.] Daniels, op. cit., p. 278.
[69.] See p. 57.
[70.] Martens, Nouveau recueil, &c., vol. I, p. 483.
[71.] I have followed the translation of the ukase in Le Moniteur, Jan. 31, 1811. Vandal, in his Napoléon et Alexandre Ier (vol. II, pp. 529-30), refers to this paper, but I have been unable to bring his account into accord with the text of the decree. The Correspondance is, of course, full of the subject.