Merchant Kings

by Stephen R. Bown

  That control was being eroded, however: in 1813 the board of control assumed authority over the company’s commercial functions and eliminated its monopoly. Twenty years later, all the company’s special rights regarding trade with China were likewise curtailed, and its role was limited to the administration of the territories of India and the training and deploying of a mighty cadre of civil servants. As its influence waned, the power and control of the British government waxed, until the more than two-century-old enterprise existed only as a quasi-governmental agency, just as the Dutch East India Company eventually became an arm of the government of the Netherlands in Indonesia.

  On November 1, 1858, after British troops crushed an Indian uprising, Queen Victoria assumed the title of sovereign, and later empress, of India. By that time, the Company of Merchants of London Trading into the East Indies had long since abandoned its commercial origins, although it still held titular commercial sway over a fifth of the world’s population. Not until January 1, 1874 , was the company officially dissolved by the East India Stock Redemption Act, ending its long, dramatic and somewhat romantic history.

  It would be overly simplistic to say that the company’s incredible success in the mid-eighteenth century flowed directly from Robert Clive’s military victories. But his tremendous abilities and his scheming brilliance certainly enabled the defeat of the French company and resulted in the early territorial gains that formed the beachhead for its later expansion. Clive did not leave an empire but rather the framework of an empire, a skeleton that was filled out by others in the coming decades. He was in the right place to exploit dynamic shifts in the alignment of world commercial and political patterns. Before Clive arrived in India, the English East India Company was a moderately successful trading enterprise, just beginning to worry over the French company’s manipulation of local political struggles between Indian princes. When he died, the company was emerging as the holder of a mighty empire on the far side of the world, the conqueror of the richest province of one of the world’s most populous and wealthy kingdoms, and on its way to becoming one of the greatest corporations in history.

  Robert Clive, in his intuitive brilliance in perceiving the fragile political makeup of post-Mughal India, was one of the world’s great merchant kings. He had the confidence to not shy away from the very large challenges and opportunities that were placed before him. Not only did his mind foresee opportunity and possibility amid political chaos and daunting odds, but his arrogance—his sense of personal entitlement, his chutzpah— was probably the trait that enabled him to change the world, for better or for worse.

  Chapter 4

  “Since my life is in constant danger not only from the hostility of wild tribes but from men often unwilling to submit to discipline, since my strength is exhausted and my health dissipated battling the hardships I have had to endure, I feel that that natural time, the hour of my death, is for me more uncertain than for most men, and therefore I make my will.”

  ALEKSANDR ANDREYEVICH BARANOV, C. 1809

  The Lord of Alaska

  ALEKSANDR BARANOV AND THE RUSSIAN AMERICAN COMPANY

  1

  IN A FORMAL PORTRAIT PAINTED AT THE TIME OF HIS retirement in 1818, Aleksandr Andreyevich Baranov, “the Lord of Alaska,” as he was sometimes known, is a balding, trim man.

  He is dressed in a formal black coat offset by a creamy-coloured silk neck scarf, over which a medal of distinction hangs prominently. He clasps a quill in his right hand, which is positioned over a partially scrawled parchment, as if the portraitist had suddenly disturbed Baranov in the act of completing his accounts or official correspondence. His gaze is direct and unflinching, his chin and lips firm as if his jaw were clenched, his posture relaxed and confident.

  Overall, the portrait conveys the impression of a man of moderate distinction who begs to be told the truth, perhaps already knows it, and merely desires the telling to be personal. He seems a kindly father figure, trustworthy, patient and understanding. His lips curl ever so slightly upward, as if in inner contemplation of a private joke or in mildly amused resignation at the state of the world. He had ruled Russian Alaska for twenty-eight years; now, at seventy-two years of age and with his tenure at its end, he did not know what to do with himself.

  During his time in the domain of the Russian American Company, on the eastern frontier of the Russian Empire, Baranov had earned a reputation for decisiveness bordering on ruthlessness, for even-handed severity in punishment, even while earning the deep respect and loyalty of many of his men. He led by example, and he kept his promises to them, donating his personal money when circumstances demanded and paying for the education in Russia of children he considered gifted. He had abandoned his first wife and children in Russia years before he departed for Russian America, but he always provided for them financially—even for the son and daughter he had adopted as foundlings. He was a hard worker and did not shield himself from the dangers faced by his men. The promotions and rewards he granted were based on merit and achievement, regardless of the recipient’s parentage or racial background. At times, he used Russian American Company funds to cover indemnity payments to orphans and widows or for native men lost on voyages, like a lord magnanimously rewarding service, even in death—actions that were seemingly at odds with his decision to compel the men to service in the first place. During his tenure, the company pushed south along the northwest coast of America so that it maintained a presence as far as what is now the boundary between the U.S. state of Alaska and the Canadian province of British Columbia. Although he tactfully headed off the northward advance of British and American mariners and fur traders, he failed to establish Russian control over the Columbia River. He even presided over the founding of a Russian company settlement in California, but failed to found a similar outpost in Hawaii, which he had considered annexing as an outpost of the Russian Empire.

  But Baranov’s kindly and intelligent eyes and bland expression belied his darker traits. He was not averse to brutality in pursuit of his objectives; he used people unflinchingly and placed them in danger when he felt the need. Stubborn and determined, he frequently threatened his employers with his resignation when his demands were not met. Admired and beloved by some, he was feared and loathed by others. He survived two attempts, a decade apart, by his men to murder him.

  His treatment of Kodiak Island natives bordered on the inhumane and was certainly illegal according to Russian law. He also made war on his competitors for years, until his company was granted an official government monopoly.

  As a corporate holding, at arm’s length from the Russian government, Russia’s American colony was built by Baranov and expanded, with his boundless energy and imagination, to become an enormous territory roughly equivalent to today’s Alaska. He began by aggressively warring with the native tribes.

  In 1804 he bombarded a Tlingit village for six days from aboard a Russian warship, forcing the residents to accept the authority of the Russian American Company. He dislocated thousands of native peoples from their homes and reordered their activities to suit the needs and interests of the company. In the process, he reduced them to serfs in their own land while extracting vast quantities of furs and other natural goods for his board of directors and noble shareholders in St. Petersburg. But when he was forced from his position as head of the Russian American Company in Alaska, a shadow hung over his departure. He was facing politically motivated charges, an investigation and a possible trial back in St. Petersburg. It was a long and adventurous life for the eldest son of a humble storekeeper born in a remote, backward village along the Finnish border.

  The Lord of Alaska was born in the tiny village of Kargopol in 1747 (around the time the young English trader Robert Clive first requested a transfer to the military branch of the English East India Company at Fort St. David). He was born in a sparsely settled region where the forest was broken by countless small lakes and ponds and where roads were muddy tracks. His father occupied the lowest rung of the tra
ding hierarchy, so low that he was denied membership in the local merchants’ guild; he was barely above the peasants in status. Although there was no school in the region, Baranov somehow learned to read and write a little and to keep accounts. A curious and enterprising boy, at the age of fifteen he fled south to Moscow, the business centre of the nation, to see the rumoured wonders of the world for himself. It was a shock to him, wrote Hector Chevigny, in his colourful and slightly fanciful 1942 biography Lord of Alaska, “to realize there could be so many people in the world, so many houses not built of logs, such huge markets, so many churches with their multi-colored domes, so many and such huge bells to fill the air at all hours.”

  In Moscow the energetic lad gained employment with a German merchant and spent the next decade or so learning all he could of commerce, bookkeeping, languages and, most importantly, reading and writing well. He avidly pursued studies in literature and science. He was also introduced to the rigid class structure of Russian society, in which nobles and merchants were segregated and his own lowly status could never be fully overcome. He rose to the rank of clerk before returning to his birthplace, where with his new capital he sought to establish himself as a higher-status merchant. But the return was a mistake. Although he married and had a daughter, he was not any happier in Kargopol now than he had been as a boy. After several years, in 1780, at the age of thirty-three, he left for Siberia with his younger brother Pyoter, filled with dreams of making his fortune. He never saw his wife or daughter again, though he always provided for them generously.

  In Siberia, Baranov and his brother worked as itinerant traders and tax collectors in Irkutsk, a prosperous town of around six thousand inhabitants, saving their money until he, Pyoter and two other partners opened a glass factory, using local raw materials. It was Baranov’s idea, gleaned from his readings while in Moscow. Glass then being an expensive import to the remote region, the enterprise was an immediate success, and Baranov was given an official commemoration from St. Petersburg for his accomplishment of helping to improve industry in Siberia. But even after eight years in Irkutsk, he had not been invited to join the local merchants’ guild because of his low class. Frustrated with this discrimination (which was probably the reason for him always treating his employees according to their abilities, not their class), his restless spirit stirred again. He also chafed at the obligation to make decisions jointly with his partners—he wanted to be the boss, even if it meant less money and more risk. So again he fled, for a further frontier, dragging his younger brother along to the sparsely inhabited region north of the Sea of Okhotsk. He planned to establish trading outposts for furs among the Chukchi, a feared and violent people.

  A prominent merchant named Grigorii Ivanovich Shelikhov, then just returning from founding a Russian colony on Kodiak Island in Alaska, tried to persuade Baranov to join his venture as a manager. Baranov refused, not wanting to subjugate his independence to the designs of another.

  His expedition began with great promise. Since the discovery of Alaska a few decades earlier and the rush to plunder its velvet booty of sea otter and fox furs, the domain of the Chukchi had been mostly abandoned by Russian traders. As a result, the quantity of furs had increased after many years of overhunting. Loading a giant raft with trade goods, the Baranov brothers poled north down the Lena River, over two thousand kilometres into Yakutsk, where they purchased reindeer as beasts of burden and continued north. After two years of trading, by 1790, they had amassed a small fortune in sable furs and were heading south when a large band of Chukchi ambushed them and stole the bulk of their cargo. Leaving his brother behind on the Sea of Okhotsk to defend what remained of their goods and furs, Baranov rushed south along the coast on horseback to report the theft to an old acquaintance, Johann Koch, who was the regional military commander at the village of Okhotsk, then Russia’s only Pacific seaport.

  Here fortune intervened. Confronted with bankruptcy, and without the means to secure new capital to start over, Baranov faced the real prospect that his shares in the glass company in Irkutsk would be forfeited to pay his creditors, which would leave his family destitute. He was pondering his next move when he received an unexpected offer. Shelikhov was in town, overseeing the launch of his ship to Alaska. He again made the trader an offer to head the thriving colony of Kodiak Island and, indeed, all of Shelikhov’s business interests in the new land. Shelikhov wanted someone ambitious and trustworthy, someone charismatic and interested in expanding the enterprise; someone who could take charge of an increasingly volatile situation and deal with the incursions of foreign (chiefly British) traders and the possibility of privateers. They negotiated an open-term appointment, but the forty-three-year-old Baranov knew that it would continue for years. The ship was leaving within weeks, and Baranov had to decide quickly. Given his financial predicament, he really had no choice. Reluctantly, he agreed.

  He could hardly fault the terms: he would be called the chief manager, an important title, with 210 shares in the Shelikhov-Golikov Company; he was to have absolute authority over Shelikhov’s operations in Alaska, with the stipulation that

  “if the local circumstances prevented following the government regulations or if the best interests of the company and fatherland were served otherwise, I am not prevented from taking action which I deem fit.” He was also given authority to be the representative of the Russian government in Alaska, to judge crimes, settle disputes and accurately record all explorations and the placement of copper territorial markers. He was to found new satellite colonies and improve and expand the operation as he saw fit. The money would be enough to pay off his debts and secure the livelihood of his Russian family.

  Baranov boarded the ship Three Saints, along with about fifty other recruits for the colonial-commercial venture, and sailed east for Alaska in the fall of 1790. It turned out to be a terrifying near-death experience, the most dangerous and wildest adventure of his life.

  2

  RUSSIAN TRADERS AND PRIVATE EXPLORERS HAD BEEN sailing the Pacific east to the distant shores of North America for about fifty years, ever since the epic voyage of Vitus Bering known as the second Kamchatka expedition. This expedition had been inspired by the progressive reforms of Peter the Great and continued by his widow, Empress Anna Ivanovna.

  The second Kamchatka expedition was one of the most ambitious scientific and exploratory expeditions ever undertaken. Based on Bering’s sober proposal to follow up on the inconclusive results of his first voyage in search of America a decade earlier, the second expedition was designed to show Europe the grandeur and sophistication of Russia. By the time Bering saw his final instructions in 1731, they had swollen to such grandiose proportions that he scarcely recognized them.

  He would be at the head of a virtual army of exploration: a few thousand scientists, secretaries, students, interpreters, artists, surveyors, naval officers, mariners, soldiers and skilled labourers, all of whom had to be brought to the eastern coast of Russia across eight thousand kilometres of roadless forests, swamps and tundra, along with tools, iron, canvas, food, books and scientific implements.

  Once he arrived in Kamchatka, Bering was supposed to build two ships and sail east to America, charting the North American Pacific coastline as far south as California, in addition to charting the coasts of Kamchatka and the Arctic Ocean and establishing astronomical positions throughout Siberia. Concurrently, he was to build another three ships and survey the Kuril Islands, Japan and other areas of eastern Asia. These were his most reasonable and practical instructions. His orders also called for him to populate Okhotsk with Russian citizens, introduce cattle raising on the Pacific coast, found elementary and nautical schools in the distant outpost, construct a dockyard for deepwater ships, and establish iron mines and ironworks for smelting ore. Not surprisingly, despite Bering’s Herculean efforts, these tasks would not be completed for generations.

  On June 5 , 1741, Bering’s two ships slid out of the makeshift dockyards at Petropavlovsk, lurched into the grey,
choppy waters and hoisted sails. As the St. Paul pushed east through the fog, Bering spent much of his time laid up below deck with an energy-sapping illness. The officers thus began running the ship without consulting him or informing him of their decisions. For almost a month, it was a dreary and uncertain voyage; the voyagers saw nothing but sky and sea until July 16. Then, their first view of America: a mighty, snow-dusted spire shrouded in fog. It towered over a vast range of smaller mountains, snug against the coast as far as the eye could see, with endless forests of green emerging into view through the mist. It was St. Elias Day, and they named the peak accordingly. The mountains, the naturalist

  Georg Steller observed, “were so lofty that we could see them quite plainly at sea at a distance of sixteen Dutch miles . . . I can not recall having seen higher mountains anywhere in Siberia and Kamchatka.”

  All the officers and mariners cheered and congratulated each other on discovering the new land. But Bering, roused temporarily from his cabin for the event, showed no elation when he strolled on deck. Surveying the scene and hearing the faint roar of distant breakers crashing against the shore, he shrugged his shoulders, returned inside and later noted glumly, yet prophetically, “we think now we have accomplished everything, and many go about greatly inflated, but they do not consider where we have reached land, how far we are from home, and what may yet happen; who knows but that perhaps trade winds may arise, which may prevent us from returning? We do not know this country; nor are we provided with supplies for a wintering.”