The reputation of early modern merchant companies has enjoyed a comeback in recent years. There has been an explosion of scholarship reassessing the purposes and performance of corporations once dismissed as hidebound monopolies. Economists have argued that merchant companies proved beneficial because they fostered commercial networks that allowed them to reduce transaction costs and establish new long-distance trade routes.Footnote 1 Historians have explored the sophisticated corporate cultures and fractious internal politics of various companies.Footnote 2 Still others have heralded them as agents of globalization.Footnote 3 But if the creation of these companies reflected a consensus that “good governance” was necessary for overseas trade to benefit the commonwealth,Footnote 4 what was the meaning of persistent calls for “free trade” in Elizabethan and early Stuart England? As has long been recognized, these calls fell short of advocacy for laissez-faire.Footnote 5 Nevertheless, this article argues that free trade was more than a slogan. Free traders tapped into powerful assumptions about the role of law and property rights in structuring economic life. In doing so, they placed the needs of public corporate communities, whether towns, cities, or the commonwealth, above the “private” interests of regulated and joint stock companies.Footnote 6 Furthermore, they upheld the rights of merchants excluded from chartered companies to participate in overseas trade. So appealing were arguments for free trade that they became a prominent theme in the debates over the economic policy and projects of an emerging public sphere.Footnote 7
A reconsideration of the free trade movement, placing it within the context of Elizabethan and Jacobean political culture, is overdue. Revisionists, skeptical that ideological conflict shaped Tudor and early Stuart politics, portrayed disputes over trade policy as the result of outport jealousy of the London-dominated trading companies.Footnote 8 Interests rather than ideals were at play. According to Andrea Finkelstein, calls for “free trade” before the Civil War “turn out to be nothing more than the demands for a greater say for outport members in the company's activities or for making it easier for nonmerchants to garner their share of these monopolistic profits.”Footnote 9 As we shall see, the campaign for free trade was driven by a wide range of interest groups harmed by company privileges. But if free traders had failed to articulate a persuasive argument that their position was also in the public interest, it is difficult to see why James I and his councilors felt the need to compromise on their support for the companies. After all, conflicts between economic interests were the norm in Elizabethan and Jacobean parliaments.Footnote 10 Had the various free trade initiatives not enjoyed broad public support, or engendered uncomfortable political questions, they might have been safely dismissed.
The revisionist emphasis on competing commercial interests has scarcely attracted the attention of economic historians and social scientists who treat Britain as the first case of economic modernity. For many of them, Whiggish and Marxist narratives, left for dead by historians in the wake of revisionism, remain alive and well, for they provide compelling explanations as to why Britain emerged as a global commercial power. According to such accounts, the victory of England's Parliament (defender of liberty and the interests of the commercial class) over absolutist monarchs (tradition-bound and protective of rent-seeking special interests) assured Britain's path to prosperity.Footnote 11 This story, of course, imposes assumptions on the historical record that would have puzzled early seventeenth-century contemporaries. As we shall see, advocates for free trade, in and outside of Parliament, saw their position as entirely consistent with a healthy respect for the royal prerogative. Furthermore, while they were keen to highlight the economic harms of monopoly, they tended to base their advocacy in what they saw as traditional notions of law and justice rather than a newfound optimism about the efficiency of unregulated markets.
Parliament may have been the most important forum for the advocacy of free trade, but it was not the only one. The push for free trade measures in the House of Commons reflected the conflicts and grievances of various towns and constituencies. The issue also informed the advocacy of projectors and the authors of economic pamphlet literature. Moreover, the complaints of some localities against merchant companies influenced the policy of the Privy Council throughout the reigns of Elizabeth I and James I. A consideration of free trade that is attentive to interactions and negotiations between the Privy Council, Parliament, and the public highlights the ability of the early modern state before the 1630s to readjust the political economy of the commonwealth.
Elizabethan Corporatism
The second half of the sixteenth century was an age of incorporation. In a political culture in which there was no clear distinction between governing institutions and economic organizations, corporatism spoke to both privy councilors and merchants. For privy councilors, haunted as they were by economic uncertainty and the threat of social disorder, the body politic was a comforting vision of hierarchy in which private interests were subordinated to the good of the whole. The constituent parts of this body politic were to realize their respective functions for the greater good. Thus, in a common schema, the monarch was associated with the head, whose role it was to provide wise and just governance; the aristocracy, as defender of the commonwealth, was akin to the arms and hands; merchants were sometimes compared to the stomach, responsible as it was for receiving food and distributing nutrition; and of course husbandmen and laborers were the legs and feet, deserving of paternalistic care for their heavy labor.Footnote 12 The incorporation of those parts—the creation of small bodies politic within the macro-body of the commonwealth—seemed to offer the Crown a way to ensure that manufactures and trades would be unharmed by the activities of the unskilled or the disreputable. The proliferation of corporations in the sixteenth century also meant that the appeal of incorporation reached deep into local communities: towns, craftsmen, and merchants all lobbied the Crown and Parliament for charters.Footnote 13
The exclusiveness of corporatism, however, made organic harmony an elusive aspiration. Corporations always faced skepticism. In A Discourse of the Commonweal (1581), Sir Thomas Smith, in the voice of the “Doctor,” advised that when a newcomer who could competently practice a craft arrived in a town, “private liberties and privileges” should “give place to a public weal and such a man gladly admitted for his excellency to the freedom of the same town without burdening of him with any charge for his first entry or setting up.”Footnote 14 Many towns had undifferentiated economies in which retailers combined local and long-distance trade to stay afloat, and they considered it their right as freemen of their town to do so. For instance, Exeter's craftsmen objected to Elizabeth I's grant of a charter in 1559 that gave the city's merchants a monopoly over trade in foreign goods by wholesale and retail. The appeals of Exeter's craftsmen to the Privy Council raised enough concern to prompt a suspension of the charter. After lengthy negotiations between the merchants, artisans, and the Privy Council, the Queen granted a new charter, but with concessions: artificers could continue to sell foreign wares by retail, and all citizens could join the company for free within three years of the patent if they relinquished their previous trade.Footnote 15 Similar disputes between merchants and retailers in Chester embroiled the Privy Council. The retailers’ case against the merchants rested on urban custom: in response to an attempt by the merchants to enforce their control of overseas trade, the retailers claimed that they had traded overseas since “tyme out of memorye of man for the better mayntence of the… Cytie.”Footnote 16 In 1589, when the mayor and citizens complained of the merchants’ attempt to exclude retailers from the trade in calfskins, the Privy Council decided in favor of the retailers, allowing them to join the ranks of “mere merchants,” provided they paid for harbor charges; only manual laborers were to be excluded.Footnote 17 The efforts of the citizens of both Exeter and Chester are evidence of politically aware urban communities protective of their privileges.
The conflict between the Merchant Adventurers of Bristol, who received a charter in 1552, and the artisans and retailers of the city, who as citizens had enjoyed the liberty to trade overseas, is illustrative of the ways local conflicts between interest groups could entangle Parliament as well as the Privy Council. The Bristol merchants’ attempt to add teeth to their charter by obtaining a 1566 statute that empowered them to enforce a prohibition against interlopers sparked a long-running dispute. In contested elections, opponents of the merchants won the city's 1571 parliamentary seats. The new members, and the city government, promptly lobbied for a bill overturning the 1566 statute.Footnote 18 The case of the Bristol commoners rested on their “wonted liberty” to trade and the fact that they, and not the merchants alone, bore the public charges of the city. Now lacking friendly representatives from Bristol, the merchants found an ally in William Fleetwood, the Recorder of London and an experienced parliament man. Observing that the Queen had the power to create corporations, he reminded the house that “she is sworne to preserve her prerogative.” In response, John Yonge of Bristol elided the question of the prerogative; he argued that the merchants’ “private monopoly” over trade had already hurt the Queen's customs revenue, and that the Bristol merchants had obtained the 1566 act by “subtill meanes,” pushing for its passage “without the consent” of the mayor and commons of the city. John Popham, the future Lord Chief Justice of the Queen's Bench, took direct aim at Fleetwood's argument. Popham maintained that repealing the 1566 statute had no implications for the prerogative at all. The company's letters patent could be left standing by Parliament, though they could be challenged at law, for they contained a proviso that left them in force only if they proved to be good for the commonwealth of the city. Popham also argued that letters patent could not entitle a “private company or bodie” to exclusive rights to a trade, a claim he believed was supported by Magna Carta.Footnote 19
In the second half of the sixteenth century, the incorporation of new companies with powers over all English commerce to certain areas transformed disagreements over the right to trade into a national issue. The foundation of the Muscovy Company in 1555 marked a departure because it was the first company with a royal charter that forbade all other English merchants from trading to its privileged areas.Footnote 20 In the decades that followed, merchants lobbied the Crown for incorporation.Footnote 21 The merchants and the Crown envisioned these chartered companies as “bodies politic,” with the authority to govern trade. They could appoint officers and set up a court, regulate their members’ business activities, and exclude merchants who did not meet the entrance requirements. In 1579, the Baltic merchants gained a charter and formed the Eastland Company.Footnote 22 Elizabeth granted letters patent establishing the Turkey Company in 1581 and the Venice Company in 1583; after both of those charters expired, in 1592 Lord Burghley combined the trades under the authority of the new Levant Company.Footnote 23 In 1585, the Crown, at the behest of the Earl of Leicester, who was concerned to enforce his monopolies over metal exports and saltpeter imports, “imposed” company organization upon the Barbary merchants.Footnote 24 The Andalusia Company, an association of English merchants in Spain recognized by Henry VIII, faded away in the mid-sixteenth century, but the Crown provided English merchants in Spain with a renewed corporate organization and new powers to exclude “interlopers” when it established the Spanish Company in 1577. After that company collapsed during the war with Spain, James I granted the Spanish merchants a new charter in 1605.Footnote 25
The evolution of the Merchant Adventurers in the sixteenth century fit the trend of incorporation. The Merchant Adventurers had its origins as a fellowship of English merchants from many ports who traded in Antwerp and had received privileges from the Dukes of Burgundy. By the middle of the sixteenth century, wealthy London merchants, especially those affiliated with the London Mercers, had come to dominate the company. In 1564 Elizabeth incorporated the company, and in 1584 issued another charter that expanded its jurisdiction and gave it exclusive rights in the Low Countries and Germany.Footnote 26 Thus, from 1555 to 1605, the Crown and London merchants brought all major branches of overseas commerce to European markets (France aside) under corporate governance. The founding of the joint stock East India Company in 1600 extended corporate governance globally.Footnote 27
According to the companies, restrictions on membership and an ability to exclude interlopers was fair compensation for the cost companies accrued by exploring new trade routes and maintaining diplomatic relations with foreign princes. The Muscovy merchants claimed that they had spent £30,000 opening the new route to Russia, and they ought to enjoy the “fruits of their travell.”Footnote 28 Likewise, the Merchant Adventurers responded to criticism of their high redemption fees, stating that “it were against all equitie and reason that every subiect of this Realme for a small somme of money shoulde have the libertie and freedom of” the company.Footnote 29 The companies also played on conventional suspicions of merchants as greedy and grasping to justify their privileges. A Muscovy Company merchant accused York and Newcastle interlopers of placing profits above loyalty to Crown and kingdom by calling attention to individuals who served the King of Denmark or married Dutch women.Footnote 30 Companies also claimed that interlopers, “unskillful and ignorant,” sold deficient wares or sold at low prices that undercut English exports.Footnote 31 From the Crown's perspective, chartered companies were institutions through which it could manage diplomatic and trade relations with foreign princes.Footnote 32 Monarchs had pecuniary interests as well. The Queen relied on the loans and customs duties paid by the Merchant Adventurers; annual rents were commonly attached to charters.Footnote 33
At their inception, these charters provoked complaints from a wide variety of traders. Individual merchants excluded from their trades petitioned the Privy Council.Footnote 34 Barbary traders argued that their business could not be governed from a company headquartered in London.Footnote 35 A memorandum in Lord Burghley's papers on the decline of Hull's trade expressed the concerns of provincial merchants: because the new companies were controlled by London merchants, they made ordinances “beneficiall to them selves, but yet to the others in the countrye the same ordeances is [sic] very often hurtfull.”Footnote 36 London retailers opposed a proposal for a chartered company that limited the French trade to mere merchants.Footnote 37 A bill proposed in Parliament in 1584 addressed the concerns of sailors. They usually traded on their own accounts until the new companies compelled ship owners and captains to forbid their sailors from doing so, to “the great ympoverishment and Injurie of the poore maryners.” The bill would have allowed sailors to trade goods equal to the value of their wages for the voyage.Footnote 38 Any overseas trader who was not a member of a company could find reason to resent new corporate privileges.
The consolidation of the Merchant Adventurers’ control over the export of white broadcloths to the Low Countries brought the most unease. Provincial members of the Merchant Adventurers jealously guarded their place in the company and saw new regulations issued from the company court as unwelcome intrusions. Although few Merchant Adventurers from York traded to Spain, they characterized a 1580 proposal that forbade company members from joining the Spanish Company as “bondage.”Footnote 39 Outport merchants, perhaps with the support of London interlopers, attempted in 1563, 1576, and 1581 to revive the 1497 statute that allowed all “liegemen” of the King to join the Merchant Adventurers for ten marks.Footnote 40 The 1563 bill opened by rehearsing the terms of the 1497 statute, and alleged that the high redemption fees and bonds taken by the Merchant Adventurers oppressed English traders. The complaint was based on an assertion that all English traders deserved to enjoy their liberties: under the Merchant Adventurers, the “free borne subiect is more bound and his libertie more greatlie abated then the vnnaturall borne strangers though he were Jewe Turk or Ethenik.”Footnote 41
It is significant that the authors of the 1563 bill appealed to nationalism and justice, and not just to economic circumstances. The drumbeat for free trade was constant throughout the late sixteenth and early seventeenth centuries, and it always became louder when Parliament was in session; it was not correlated with short-term fluctuations in England's commercial fortunes. Some historians have argued that the push for free trade in the early years of James I's reign was caused by the desire of provincial merchants to capture their share of the trading profits that would come after peace with Spain.Footnote 42 But the evidence from Elizabeth's reign reviewed here suggests there was an accumulation of grievances over time. As we shall see, interest groups harmed by company privileges lobbied the Privy Council and Parliament during the prosperity of James I's first fifteen years on the throne, and they redoubled their efforts during the disastrous bullion shortage and trade contraction of the early 1620s.
The different interest groups opposed to the chartered companies based their complaints on customs associated with other public, corporate bodies. Freemen of towns, such as the retailers and artisans of Chester and Bristol, asserted that their “wonted liberty” to trade overseas was protected by the traditions of their own corporate communities. Unlike retailers and artisans, provincial merchants who had served an apprenticeship could welcome restrictions against the untrained but were suspicious of governance from London. Neither position, however, reflected the interests of rural clothiers and gentry who wished to profit from England's overseas trade and who were not privileged freemen of any town or city. Their position is perhaps best reflected in an anonymous tract written around 1587, “A Discourse of Corporations.” The author took a dim view of both merchant companies and incorporated towns, for these institutions raised prices and stifled commerce. Corporations that restrained trade acted “against common right and the lawe, vnder the which we are borne, and is our inheritance, and ought not to be taken from any members of the same state without aparant vtilitie and profit of the whole bodie of the commonwealth.”Footnote 43 The question of who deserved to be included in the “lawful” occupation of overseas trade was difficult to resolve, but, as Jacobean parliamentary debates suggest, opposition to the companies was strong enough to facilitate the creation of legislative coalitions capable of reaching compromises.
Restoring Free Trade
James I's first Parliament met with hopes of reform and renewal. The last decade of Elizabeth's reign had been marred by war, heavy taxes, dearth, and the political storm over monopoly patents. While free trade did not enjoy Privy Council support, the MPs who drafted the free trade bill of 1604 had reason to hope that they could curb the power of the corporations in a way that would be acceptable to the new king. James I's proclamation against Elizabeth's monopolies, and Secretary Cecil's willingness to consider parliamentary action on purveyance, another issue that touched the royal prerogative, suggested an eagerness to win popular support.Footnote 44 In the debates of 1604 and subsequent sessions, free traders crafted a powerful argument from the common law and ancient constitutionalism that largely sidestepped the issue of the King's prerogative and undermined the legitimacy of the Elizabethan companies. At only one point, in the 1614 discussion of the new French Company, did a serious constitutional disagreement between the Commons and the Crown over the issue of chartered companies become a possibility.
The 1604 arguments for free trade drew upon fundamental ideas about the danger monopoly posed to liberties and property rights.Footnote 45 By framing free trade as a restoration of the subject's “natural right,” Sir Edwin Sandys and the trade committee were able to justify the creation of a broad bill that would clip the privileges of the new chartered companies, garner the support of provincial commercial interests, and attract the sympathies of gentry members who might otherwise have been uninterested in commercial issues. The committee consolidated two proposed bills into one bill to open overseas commerce to almost all subjects and abolish company ordinances that unduly limited participation. If passed, the act would restore the “inheritable” right of subjects, “as to their land, so also to the free exercise of their industry, in those trades whereto they apply themselves, and whereby they are to live”: an argument that would have resonated with landowners obsessed with protecting property rights.Footnote 46 Although the representatives of the outports supported the bill, it did not simply cater to provincial merchants. Indeed, it may have made some uncomfortable, for it struck down company ordinances that required overseas traders to serve apprenticeships. Those who served apprenticeships “have their skill for their labour;” they did not need to be compensated by freedom from competition as well. The committee appealed to the sensibilities of the landed gentry by observing that if only those who had served an apprenticeship were skillful enough to trade, an argument could be made for keeping “young gentlemen… from their lands for want of skill to govern them.”Footnote 47 At first glance, the bill for free trade to all countries may seem to signal a new openness toward unfettered participation in commerce. But the authors of the bill, by invoking the 1497 statute and “natural right,” framed it as a measure of reform rather than innovation.Footnote 48
A recognition of the conservative nature of the 1604 free trade bill helps dispel some persistent misperceptions, namely that the bill was an assault on the prerogative and that it abolished the companies.Footnote 49 Sandys and the committee were aware that an antagonistic stance toward the Crown would scotch any chance the bill had of passage. To the companies’ charge that it was a “taint to the king and state” to call chartered companies “monopolies,” the committee answered that “the same reason doth justify all the monopolies that ever were.” The committee denied that it was an attack on royal authority to reform the “abuses” “creep[ing]” into corporations, and, in any case, the King “hath declared himself a just enemy to all these unjust monopolies.”Footnote 50 The bill did not dissolve the companies or invalidate royal letters patent. At most, it abolished the ability of companies to use their charters to prevent new members from joining: “Those orders in companies, which tend to monopoly, it abrogateth.”Footnote 51 The committee also rejected the claim that allowing too many merchants to trade would make it impossible to govern commerce for the benefit of the commonwealth. The bill, the committee pointed out, required all merchants to pay for “public charges,” such as those owed for ambassadors. Furthermore, “it is weakness to say that a greater multitude cannot be governed; for so neither kings in their dominions, and subjects, nor cities in their amplitude should increase.” The free traders put forward a vision of companies that operated as open associations of “provident men” who would “consult and join together in that which were for their common benefit, ease, and safety.”Footnote 52 Despite these attempts to address the King's concerns, the privy councilors may have suspected that the bill came too close to challenging the prerogative. There were also legal difficulties: the bill did not specify exactly which company rules counted as monopolistic; this was perhaps one of the reasons Sir Edward Coke, as Attorney General, spoke against it, “especially for the Form of it…howbeit he acknowledged the Purpose and Intent of the Bill to be good.”Footnote 53 In conference with the Commons, the Lords declined to proceed with the bill, but suggested that the “frame” of the bill should be reconsidered in the next session.
In the debates over trade, free traders showed flexibility in maintaining a coalition of interests that could command majorities in the Commons, if not the Lords. Although the 1604 bill did not require aspiring merchants to serve an apprenticeship, it allowed companies to exclude practicing clothiers, retailers, innholders, farmers, and artisans from trading overseas. Thus, those with occupations in England were not to be guaranteed the right to compete with those who made a living by overseas trade alone, a concession that might have put provincial merchants at ease.Footnote 54 In 1606, the Commons successfully pushed through the bill for free trade to Spain, Portugal, and France; this, as Pauline Croft showed, was driven by the members representing fishing and gentry trading interests in the southwestern constituencies.Footnote 55 The bill opened trade to all, but in the next session, Parliament, despite some opposition, accommodated the Exeter Merchant Adventurers by exempting their charter from the provisions of the bill.Footnote 56 This instance has been highlighted by historians skeptical of ideological explanations of free trade.Footnote 57 But the hypocrisy should not be overstated. The statute only affected Exeter citizens, and it reaffirmed a charter that had gained the assent of the community long ago; however hostile they were toward the national chartered companies, the members of the Commons hardly intended to call into question the ability of urban corporations to govern themselves according to local circumstances.Footnote 58
As royal acceptance of the 1606 free trade bill to Spain, Portugal, and France suggests, Robert Cecil, now Earl of Salisbury, and the Privy Council felt pressure to find some accommodation. By the early seventeenth century, free trade had emerged as a popular issue, and to ignore or rebuff the critics of the companies would be to alienate much of England's commercial community. Free traders constantly lobbied Parliament and the Privy Council. When the Privy Council, in response to the 1597 Imperial mandate against the Merchant Adventurers, ordered all cloth exports to be confined to the Middleburg, clothiers and interlopers (including company members trading in areas outside the company's jurisdiction against company orders) petitioned and raised enough fear of a trade depression for the council to backtrack in March 1601 and grant freedom of trade on the Elbe and Weser.Footnote 59 The Venetian ambassador reported that merchants’ petitions had prompted the 1604 free trade bill. In September 1605, Salisbury complained to Chief Justice Popham of merchants opposed to the recently reestablished Spanish Company. According to Salisbury, while most merchants approved of the company, some were “waywardly disposed,” and “putt upp petitions declaring that it is against the Lawes of the Realme for the Kinge to prohibit any marchant to trade wheresoever he will.”Footnote 60 A report from Spanish Company merchants to the Privy Council warned of the campaigning of Sir George Somers, a former privateer, burgess of Lyme Regis, and supporter of the 1606 bill.Footnote 61 According to the merchants, he “writ his L[ett]res & sent messeges up & down all the west country to collect many and p[ro]cure hands to overthrow the [Spanish] corporac[i]on.” Among the signatories of the petition against the Spanish Company were “Dyers, Tuckers, Weavers, & of diverse mechanicall fellowes.”Footnote 62 The city of Bristol remained a vocal opponent of trade restrictions. In 1597, its mayor, aldermen, and clothiers complained that the city's merchants were excluded from the Mediterranean trade by the London-dominated Levant Company; in 1609, when the Privy Council asked his opinion on the possible incorporation of a French Company, the mayor made the displeasure of the city known.Footnote 63 A proposal to revive the Spanish Company in 1617 met with opposition from Bristol, Exeter, Plymouth, and other western ports.Footnote 64
Salisbury looked for ways of maintaining the role of chartered companies that did not run afoul of Parliament or provincial sensibilities. In 1605, when he asked for Popham's legal opinion on whether it would be possible to create companies that could not be condemned as monopolies, he explained that trades lacking companies would be unable or unwilling to help enforce Crown policy. When the Privy Council “would understand or direct any thinge, w[hi]ch concerneth the Trade of France, or trade of the Levant, we know not when to send unto [the traders] nor when [the traders] come before us, can we get any perfect or solide answeares, because they are not under any orderly constitution.”Footnote 65 Still, Salisbury and the Privy Council made some efforts to create more open companies. The Levant Company, chartered in 1592, had allowed only qualified factors and apprentices to become new members. After that company's demise, Salisbury acceded to the merchants’ requests for a new charter, but one that allowed for a larger, more inclusive company. It had 119 initial members—all those who applied for membership before Annunciation were to be admitted for £25 (those applying after were to pay £50).Footnote 66 More provocatively, in 1611 the Privy Council responded to difficulties experienced by traders in France by creating a French Company. Although the authors of the charter insisted it was in accord with the “true meaning” of the 1606 free trade statute—English fishers who sold in French markets were exempted from company regulations, and new members could join for the low fee of £4—the requirement that new members be mere merchants contradicted the 1606 statute.Footnote 67
Salisbury and the Privy Council's desire to retain the companies as important institutions raised the legal and constitutional stakes of the issue. Throughout the 1610 debates over new impositions, the common lawyers invoked the principle of free trade to help illuminate the boundaries between the liberties of the subject and the royal prerogative. At first glance, impositions and the right of entry into trade would appear to be separate issues. But common lawyers perceived connections between the two, for both concerned the premises by which the Crown could deprive a subject of his livelihood. In 1610, Nicholas Fuller characterized one's occupation as a kind of property; he argued that the laws of England were the “most high inheritance of the land,” and assured subjects the right to their property and “lawful and free trades, mysteries, and manual occupations as in their lands and goods.” The famous Monopolies Case of 1601 showed, according to Fuller, that royal letters patent could not prevent subjects from practicing their lawful trades.Footnote 68 Thomas Hedley observed that while the King had the power to incorporate towns, cities, and companies of merchants for the “better order and government of the same,” he could not do so to raise profit for himself or his favorites. Likewise, the King could not impose to raise money to pay off the royal debt.Footnote 69 Sir John Doderidge, who defended the King's power to impose, was at pains to separate the issues. He drew a distinction between impositions—which were (theoretically) necessary for the defense of the realm—and the power to create monopolies that “take away the means of any man's living.”Footnote 70 It is telling that Doderidge believed that likening impositions to corporate trade restrictions could only serve to undermine the legitimacy of the former.
In the famously distempered Addled Parliament of 1614, free traders launched a ferocious attack on the legality of the French Company. In the committee of the whole house, they charged that the company “was against common law, which allowes euery man freely to dispose of his own goods,” violated Magna Carta, and was “contrary” to the 1606 statute for free trade. The French Company's requirement that all its members be merchants who had served an apprenticeship disrupted West Country trading practices. Before, merchants and gentry from the western counties had pooled resources to fund trading expeditions that could return from France far quicker than the French Company's London merchants; but “thear was nowe noe ships almost but a few fishermen, to the great weakening of” the western counties.Footnote 71 The debate reached a boiling point in late April and early May when several members characterized the French patent as a fundamental threat to English liberties. Sir Roger Owen, knight for Shropshire, fumed that “this sulphurous word of non obstante [by which the King granted an exemption to a statute] was first ordained by the Pope.” John Whitson, a merchant from Bristol, compared the company's practices with the ways of “the court of Rome that would have no sheep come there without his fleece.”Footnote 72 Although the heated debate over the French Company showed the potential for free trade to raise uncomfortable constitutional issues, the MPs’ tendency to blame the merchants who procured the patent probably diverted anger away from the King himself. Opponents of the French Company accused its leaders, like Papists, of being beguilers, corrupt agents who, if left unchecked, could lead the King astray. As we shall see, outside of Parliament, free traders were eager to present themselves as restorers of the King's true authority.
Projecting Free Trade
Invocations of free trade, accompanied by calls to reform or even abolish the chartered companies, became commonplace in the growing economic literature of the early seventeenth century.Footnote 73 To be sure, there were few printed tracts devoted specifically to the subject of free trade. Indeed, more prominent in the printed literature than calls for free trade were full-throated defenses of the chartered companies.Footnote 74 Chris Kyle and Emily Erikson have highlighted how economic interests sought to sway Parliament through print, but from 1604 to 1629 it was obvious that there was little need to try to convince parliamentary representatives of the merits of free trade.Footnote 75 With the public (or at the least the House of Commons) on their side, writers attempted to sway the King's councilors by circulating manuscripts they hoped would reach the Court. Furthermore, at least some authors who wished to build public support for their favored policies and projects recognized the appeal of free trade arguments and attempted to link them to their causes.
Such projects and policies could be entirely consistent with a healthy regard for royal prerogative. For instance, Cockayne's scheme to suspend the privileges of the Merchant Adventurers and require all cloth exports to be dyed and dressed was originally presented as a project to restore free trade, though it soon became clear that the new company would be as exclusive as the old one.Footnote 76 As solicitous of royal favor as Cockayne was Thomas Milles, a proud customs official of Sandwich who published several tracts to be distributed at Court. In these pieces, he excoriated the Merchant Adventurers and other companies for policies that favored London and barred traders from outports.Footnote 77 He also attacked the companies for devaluing and exporting coin, which “is the Bodie and Blood of Kings, not as Men but as Gods.”Footnote 78 He advocated for the restoration of the staple system, in which “many towns,” under the oversight of the King's loyal customers, would be open to all merchants and allow for the growth of “many Citties like LONDON.”Footnote 79
The King's advisors ignored Milles's proposal, but in the 1610s, they gave some consideration to the fish busse project, another scheme intended to revive the outports. Calls to emulate the Dutch and enrich England by an organized effort to exploit fisheries had been around since the 1570s, but by the 1610s there was renewed interest as the Lord Treasurer, the Earl of Northampton, entertained projects to raise royal revenues. However, the proposed busse company drew strong opposition from merchants who complained to the Privy Council that the company's proposed privileges, including the right to trade in any overseas markets where fish was sold, would violate their charters.Footnote 80 In response, the supporters of the busse company turned to public appeals, with some authors drawing a distinction between the openness of the proposed busse company and the exclusiveness of the merchant corporations. Tobias Gentleman's pamphlet called for all subjects to “lawfully” earn “with all diligence the blessings that Almighty God doe yeerely send unto us” by working on, or investing in, busses.Footnote 81 Another supporter of the busse project, Robert Kayll, took direct aim at the merchant companies. In his 1615 tract The Trades Increase, Kayll called for “a freedom of Traffique for all his Maiesties subiects to al places.” Kayll, echoing sixteenth-century criticisms of the Merchant Adventurers, argued that all subjects who trade abroad ought to be “combined together in one natural league” with the right to buy and sell. As Kayll lamented, “the common-wealth [was] being made private.”Footnote 82 Kayll's vociferous attack against the companies was hardly free of self-interest; it was provoked by the companies’ successful lobbying against the busse project. But his detention at the orders of the Privy Council, and Sir Dudley Digges's response attacking Kayll and defending the East India Company, are evidence that the corporations took the free trade message to be a serious threat.Footnote 83
Kayll's punishment was discouraging, but the trade disruptions of the 1610s and 1620s gave free traders renewed hope that the King might reconsider the wisdom of bestowing privileges on companies. Perhaps significantly, they turned to discreetly distributing manuscripts, rather than public print, to persuade the King and his council directly. One author, Henry Haibley, mounted a rare defense of interlopers who sought to break into the markets in Germany beyond the jurisdiction of the Merchant Adventurers.Footnote 84 Writing as Cockaigne's project experienced difficulties, Haibley chided both the new and old adventurers for being tied to old marts and settled courses of trade, neglecting the profits that could be made by bringing goods directly to German markets, “where nowe huxters make a second and a third gaine before [English goods] cometh to the Retaiylor.”Footnote 85 Haibley focused his critique on the companies, not the Crown. He left unnamed exactly who committed “the Erro[r] of former Ages that assigned all” the “blessings” of English trade “unto peculiar soceityes, Basterdizeinge the generallity for whome they were ordeyned to the infinite inconvenience of this Kingdome in generall.”Footnote 86 There is some evidence that free trade arguments gained the attention of policymakers confronting the bullion shortage of the early 1620s. One manuscript pamphlet that circulated early in the debate over the bullion shortage laid the blame on the companies. The French, Muscovy, Levant, East Indies, and Merchant Adventurers companies “are no other then so many several monopolies… [if] the way [was] made open for an ample and a free trade we should quickly prosper.” The author dismissed the claims that companies kept trade “orderly” and English goods “in estimac[i]on” abroad as “fayer in show, but by pratise… [the companies] serve only to enrich some few Marchants, by the undoeing of all the K[ing]dome beside.”Footnote 87 Another anonymous tract that found its way to Lionel Cranfield, then the Earl of Middlesex and the Lord Treasurer, made similar points. It further claimed that opening up English commerce to all would alleviate the bullion shortage, for “where the most traffique is, there is the most monie.”Footnote 88
The bullion shortage was so severe that it could cause economic thinkers generally supportive of the corporate governance of trade to question company practices. Gerard Malynes was the famous proponent of reviving the office of the Royal Exchanger; this, he suggested, should compel merchants to measure the King's coin at its intrinsic metallic worth. Although he believed that companies were helpful in governing trade,Footnote 89 he also criticized company merchants for relying on their privileges to save themselves from losses on the exchange. Lars Magnusson, echoing Malynes's critics, has observed that it is “difficult to understand why, by some evil force, only the English merchants and public were hurt” by foreigners’ bills of exchange.Footnote 90 But to Malynes, the answer was obvious: too many state-granted privileges gave company merchants too little incentive to be careful with the King's coin. While the undervaluation of English currency abroad prompted company merchants to accept low prices for English exports, they could recoup their losses by using their monopsony over English cloth to reduce clothiers’ prices and their monopoly over imports to raise prices for English consumers. For Malynes, this was why the Levant Company's monopoly over the currant trade, and the restored Merchant Adventurers’ 1617 patent giving them privileges over the new draperies, contributed to the shortage of coin: those companies’ merchants could make profits even after losing some of the value of their commodities by the exchange.Footnote 91 Malynes was the loser in the debate over the bullion shortage; the 1622 Trade Commission ultimately adopted Misseldon and Thomas Mun's argument that specie shortages were the result of an unfavorable balance of trade, and not the tricks of foreign bankers.Footnote 92 But Malynes's accusations against the Merchant Adventurers and other companies could not be dismissed.Footnote 93 Malynes believed that companies were necessary, but he held that they needed reform and firm governmental oversight, a view that was similar to the position ultimately adopted by Parliament, the Privy Council, and the 1622 Commission for Trade.
Finding Compromise
Speaking at the beginning of the 1621 Parliament on the abuses of penal laws, which allowed informers to extort fines from those they accused of economic infractions, the godly lawyer Thomas Crewe warned “that which was a golden sceptre in the hand of the king may prove a rod of iron in the hand of the subject.”Footnote 94 Crewe's fear—that nefarious private interests had co-opted the authority of the King—was a concern that representatives in 1621 brought to one issue after another. It inspired the bill against informers, proposed in 1621 and passed in 1624. This statute limited the ability of private “informers” to notify authorities of economic infractions and, in the event of a resulting conviction, collect a portion of the fine. A hostility toward private persons who sought to use the power of the state for extortion also drove passage of the 1624 bill against concealments that limited the ability of “concealers” to sue or compound with property owners who allegedly held the King's lands without proper title.Footnote 95 And, of course, resentment toward those who would leverage court connections to extort subjects was most apparent in the proceedings against monopolists in the Parliament of 1621 and the passage of the famous Monopolies Act of 1624.Footnote 96 The renewed attacks on the corporate governance of trade from 1621 to 1624 were therefore not just a response to deteriorating economic conditions or the numerous complaints of provincial interest. The call for free trade was part of a larger movement inspired by political and legal principles. It is little wonder, then, that before the floor debate on the 1621 Welsh free trade bill, Sir Jerome Horsey, a nervous supporter of the bill, called for the House “to tye the Lawyers to better attendance [in the] mornings.”Footnote 97
The 1621 Parliament saw support for a raft of free trade bills that liberalized sectors of domestic and foreign trade.Footnote 98 As in the earlier sessions, supporters of free trade in 1621 and 1624 framed their proposals as restorations of ancient liberties. Sandys repeated the argument that subjects held their occupations as a kind of property.Footnote 99 Coke argued that free trade was the “ancient wisdom of the law,” confirmed many times by parliamentary statute: “Lett not [opponents of free trade] trick me with ratione del stato; neminem oportet esse legibus sapientiorem.”Footnote 100 William Nyell, burgess of Dartmouth and a vocal advocate of the western outports, devoted much time in the committee of trade and on the floor to demonstrating the novelty of corporate privileges. Nyell argued that while merchant fellowships were ancient, nationally chartered companies with the power to create restrictive bylaws were an innovation of Elizabethan times.Footnote 101 According to Nyell, “the principle cause of the decay of trade is the imprisonment of it, and this is an old disease, but not as long neither as it is thought.” Nyell dated the onset of the “disease” to the 1564 charter awarded to the Merchant Adventurers, but noted that the charter's provisions were not strictly enforced until peace with Spain in 1604.Footnote 102 The Merchant Adventurers thus existed long before their current set of privileges. An implication of this claim was that the company could be reformed if stripped of its monopolistic powers.
Economic interests, including those of some companies, sensed an opportunity if they could link their causes to free trade. The Welsh members presented their bill for free trade in Welsh cloth as a corrective to the monopolistic privileges granted to the Shrewsbury drapers.Footnote 103 The petitioners of the Cinque Ports claimed the ports’ “Auncyent usage, and Custome and the libertie” to trade, held by charter since 1278, was violated by the restrictive practices of the Merchant Adventurers.Footnote 104 Sandys used his position as both leader of the Virginia Company and as a member of the 1621 trade committee to align the company with the cause of free trade. In January 1620, Sandys and his company supporters dissolved the Magazine, a separate joint stock company that supplied the colony and exercised a monopoly over its trade. In its place they instituted “free trade.”Footnote 105 Thus, a year later, Sandys was able to assure the Commons that all English merchants could trade with the colony. He sought to advance the company's interests by arguing against the tobacco farm, characterizing it as a monopoly that, by allowing the importation of Spanish tobacco, harmed Virginia planters and diminished England's bullion supply.Footnote 106 Even the Staplers, whose control of the domestic wool trade came under fire in 1621, made a play for free traders’ sympathies by offering a bill that would have restored their ancient right to export cloth as a way to diminish the monopoly of the Merchant Adventurers.Footnote 107
A respect for tradition also pointed toward a resolution of the issue of whether merchants who had not served an apprenticeship should be allowed to trade overseas. The 1621 parliamentary committee of trade allowed that “unskillful” London shopkeepers should be excluded, but also held that it should be “Otherwise in the Out-ports,” where retailers and artisans commonly traded as merchants “according to ancient Use.” The committee affirmed that cities that had merchant guilds, such as York, Norwich, and Exeter should be left “to their Choice to be as London, or the Out-ports.”Footnote 108 While MPs could tolerate local restrictions on commerce, they balked at proposals to create national restrictions on participation in overseas commerce. The Commons rejected a navigation bill proposed by the Merchant Adventurers that would have restricted imports and limited participation in overseas trade to merchants who had served a seven-year apprenticeship.Footnote 109
The debate over the stillborn 1621 navigation bill suggests that MPs saw the greed or incompetence of merchants operating independently of the companies as no great threat to the commonwealth. Sir George Calvert, for instance, suggested that if a merchant “have not experience, let him smart for it himself; if he prosper, the kingdom will be the better.”Footnote 110 But cliques of merchants, endowed with powers to distort markets, were another matter. Sir John Eliot noted, “it cannot be that the great business of trade can be discharged by a few… usually those men's appetites that engross all trade into their hands exceed the strength of their stomachs to digest it well and that makes them surfeit, and us suffer.”Footnote 111 In the early days of the 1621 Parliament, critics of the Staplers’ privileges over the domestic wool trade asserted that “all Corporations were turned presently into Conspiracies.”Footnote 112
In the wake of the trade depression and rising unemployment, constituencies and provincial communities organized to provide Parliament and the Privy Council with plenty of evidence against the companies. Magistrates and clothiers reported to the 1621 Commons and the Privy Council's committee of trade, appointed in spring 1622, that corporate restrictions hindered cloth exports.Footnote 113 The Merchant Adventurers’ impositions, levied to repay the King the £50,000 he charged in exchange for the new patent, also caused resentment.Footnote 114 Clothiers claimed that the company's privileges enabled its agents to collude to offer low prices for cloth. They argued more buyers were needed to raise prices and to find new overseas markets.Footnote 115 John Banks, who sat on the 1624 committee to review the Merchant Adventurers’ charter, concluded that trade “should not be left to be governed by a few private men who seek but their profit”; continued parliamentary oversight of the companies would be needed.Footnote 116
To the argument of the companies that they were institutions created by the King for the public good, free traders answered that this claim mischaracterized the relationship. Companies that lobbied for charters and privileges did not enhance the power of the King; they co-opted it. As the 1624 committee of trade concluded, the Merchant Adventurers “have grown upon the State.”Footnote 117 The decision to cast the Crown as the victim, rather than the enabler, of greedy corporate interests was wise, for it allowed the King's advisors to reach compromises with the Commons without calling the prerogative into question or embarrassing the King. Sir Lionel Cranfield, who became the Privy Council's chief spokesman on trade issues in the 1621 Parliament, signaled an openness to reform early in the session by declaring that the corporations were provided “for the good of the kingdom,” but “if it appear otherwise let them go down.”Footnote 118 With the quick passage of subsidies in the first session, the Commons gave away any leverage it might have exercised over the Crown. Afterward, the King forbade the committee of trade from examining the Merchant Adventurers’ books as this would have revealed the details of the company's agreement with the King for the restoration of its privileges. Just before the adjournment of the first session, Cranfield pushed back on claims that the Merchant Adventurers had impoverished the outports.Footnote 119 Nevertheless, the complaints in the first session of 1621, and the reports of discontent and rising unemployment in clothing counties, had an impact. A proclamation granted free trade in Welsh cloth, and in response to the Commons’ petition, the Privy Council allowed outport merchants who were not members of the Merchant Adventurers to trade in new draperies in the company's privileged area.Footnote 120
These moves signaled that the King and the Council remained willing to curb the privileges of companies if the King's power to create corporations was not directly challenged.Footnote 121 In June 1622, the committee of trade appointed by the Privy Council recommended allowing more merchants into the companies “and so enlarge trade w[hi]ch is said to be imprisoned,” a position later adopted by the Commission of Trade appointed in November of that year.Footnote 122 When the 1624 Parliament met, Sandys, now a client of the Duke of Buckingham, conveyed a sense of what the Commons might achieve. As head of the parliamentary committee of trade, he asserted that “the state of the Merchants Adventurers is like to that of religion, not to be quite taken away but to be cleansed of the abuses that had crept in and to be reduced to its former purity.”Footnote 123 Sandys had always held that free trade could coexist with companies, so his statement was less a reversal than a change in emphasis. But in case the Commons failed to reach a position acceptable to the King, Sandys observed “the King will (if we do not) provide some order for government of trade.”Footnote 124 Sandys's warning directed members toward winning tangible concessions through negotiation with the Crown. What Robert Ashton has interpreted as a softening of the Commons’ attitude toward the companies was probably a mere recognition of the political reality that the Commons could achieve little without the blessing of the Crown.Footnote 125 The 1624 free trade bills made little progress. Meanwhile, the parliamentary committee of trade focused on crafting a petition of grievances, proposing to retain the companies but curtail the privileges of the Merchant Adventurers and open the trade in new draperies to all. The Commons petition closely matched the position arrived at by the Commission of Trade. At the recommendation of Commission, the Merchant Adventurers agreed to reduce their impositions and to accept all Staplers and other merchants who were not shopkeepers. While the Merchant Adventurers would retain their control of the export of white broadcloth to their marts, the trade in new draperies would be “free, which is [within] the scope of Parliament, for if a government should be erected for these lesser commoditiyes the charge would eate up the gaine and thereby hinder tradeing.”Footnote 126 The compromise of 1624 was the fruit of twenty years of free trade agitation in the Commons and the lobbying of provincial interests. Like most agreements on deeply contested issues that emerge from deliberative bodies, it took a long time to achieve and probably pleased no one completely. But despite its long gestation, the compromise did not last.
Conclusion
Recent scholarship has framed chartered companies as key actors in state formation. This scholarship has emphasized the ability of chartered companies to partner with the Crown to obtain both economic privileges and quasi-statist powers. Such agreements advanced both the “private” interests of merchants and the revenues and imperial aspirations of the Crown.Footnote 127 What this perspective risks eliding is that late sixteenth- and early seventeenth-century England also saw a long-running, public debate over two powerful beliefs: that commercial life was best structured by corporations, and that no English subject ought to be deprived of his “lawful” occupation. A consideration of the free trade campaign brings the tension between the two beliefs firmly into view. As long as the early modern state's political forums remained open enough to allow for dissent and protest to be seriously considered, compromises and adjustments to England's political economy could be achieved.Footnote 128 However much Salisbury and other royal servants saw the advantage of using merchant companies to govern trade, they took the complaints of free traders seriously, as illustrated by the efforts of Salisbury to create companies with relatively open memberships and those of the Privy Council to resolve disputes between the outports and London merchants. When the Privy Council proved unreceptive to free trade arguments, Parliament and advocacy within a newly emergent public sphere provided important venues for the airing of free traders’ grievances.Footnote 129
The accession of Charles I closed the possibility of further compromises between the companies and their critics and set the stage for a reversion to corporate governance of trade, this time even more firmly under the control of the Crown.Footnote 130 In the late 1620s, the attempt to impeach Buckingham and the struggles against arbitrary taxation, imprisonment, and quartering of soldiers in private homes left little time for Parliament to consider the grievances of outport merchants and interlopers. The Personal Rule of the 1630s of course closed Parliament as a means by which merchants unaffiliated with chartered companies could seek redress of their grievances. In its absence, Charles I pursued policies that enhanced the privileges of several companies and Crown revenues. In 1634, the Privy Council responded to another trade depression by restoring the monopolistic privileges of the Merchant Adventurers. The Crown gave the Levant Company additional powers to restrain interlopers, and its policy on wine customs brought in additional revenues even as it advantaged the French Company at the expense of vintners.Footnote 131 Just before and during the Civil War, the companies found accommodation with a Parliament desperate for financial support, and abolition of the regulated company privileges had to wait until the late seventeenth century.Footnote 132 But resumption of agitation and publications for free trade during the Civil War years suggest that such arrangements between the state and the companies lacked public support.Footnote 133
Indeed, the chartered companies could never feel entirely secure in their privileges. By the late seventeenth century, as William Pettigrew and Tristan Stein have argued, the debate over trade organizations primarily concerned the form chartered companies should take—regulated or joint stock—rather than whether or not they should exist at all.Footnote 134 But this does not mean that the free trade controversies of the late sixteenth and early seventeenth centuries had no enduring significance. Defenders of the late seventeenth-century regulated companies presented them as relatively open associations of free merchants, a vision that owed something to the compromises forced on the companies earlier in the century. Late seventeenth-century defenses of joint stock companies as professionally managed organizations open to all investors were anticipated by Sir Dudley Digges, who argued for the necessity of the East India Company's privileges even as he supported a reduction in the privileges of the Merchant Adventurers.Footnote 135 Perhaps most significantly, the argument advanced by the Merchant Adventurers and other companies in the first half of the seventeenth century—that only mere merchants who met stringent membership requirements could capably manage overseas trade—suffered a mortal blow. If innovative, state-sanctioned corporations structured seventeenth-century England's commercial organization, so too did ideas of liberty and the commonweal, which were of great antiquity.
