Joint-stock companies as the sinews of war: the South Sea and Royal African Companies

Paul, Helen (2008) Joint-stock companies as the sinews of war: the South Sea and Royal African Companies. In, Torres Sánchez, Rafael (ed.) War, State and Development: Fiscal-Military Status in the Eighteenth Century. Navarra, ES. Ediciones Universidad de Navarra, S.A., pp. 277-294.

Abstract

Modern distinctions between private and public enterprise and between trade and warfare do not easily apply to the great trading concerns of the early modern period. Joint-stock companies were private concerns with shareholders, but they fulfilled more than one role in serving the needs of mercantilist states. They were founded to rationalise national debts which had largely been incurred to service the state war machine. By reducing the administration costs and interest charges borne by the State, debt restructuring improved the State’s ability to bear higher debt burdens in the future. This, it was understood, was important for future campaigning. In return for this service, joint-stock companies such as the South Sea Company and the Royal African Company were granted monopolies of trade. England’s Blue Water Strategy favoured the Royal Navy and used it to safeguard trade and to block the ascendancy of other nations. The history of the South Sea and Royal African Companies is an illustration of this state of affairs. This paper will discuss the linkages and alliances between these joint-stock companies, the English state and the Royal Navy. The use of joint-stock companies to deal with Navy debts is well-known, as is the fact that naval convoys protected merchant fleets. However, the linkages between the service and the two slaving companies extended well beyond these considerations. Scarce resources were shared or protected from being commandeered and Royal African and South Sea Company men were regularly exempted from impressment. The two companies could gain supplies or dockyard space from the Navy and brought supplies out to Navy vessels in return. The Navy and Royal African Company also co-operated over the treatment of suspected pirates, including the task of putting them to trial. These activities show that the Royal Navy was not simply required to assist the two slaving companies as part of the Blue Water Strategy. It treated them more like partners in a joint endeavour, and as if they were part of the state apparatus. This stance did not alter even after the South Sea Bubble of 1720, implying that it had not lost its respect for both companies despite the public outcry about the crash.

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Contributors

Author: Helen Paul

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