by Nick Bunker
Four years before the great Tea Party, rumors were already rife that the patriots of Boston planned to destroy all the legal tea they found. Under threat of violence the Hutchinsons abided by the boycott, at least temporarily. But when they resumed their dealings in tea in 1770, the family business found it hard to return to profit. For this the governor blamed the smugglers of tea from the Netherlands. Like the Royal Navy officers in Boston, whom he counted as personal friends, he grew ever more exasperated. In the summer of 1771, Thomas Hutchinson began to bombard Lord Hillsborough with strident letters urging him to intensify the patrols along the coast.
“In New York they import none but Holland tea,” he told the colonial secretary. “In Rhode Island it is little better, and in this province the Dutch traders are increasing.” According to Hutchinson, the town of Boston consumed three hundred chests of tea each year. For the colonies as a whole the total came to nearly twenty thousand, of which, he reckoned, four out of every five were smuggled in. This estimate closely tallies with the data available from London, where the Treasury made similar calculations.15
As time went by, the governor’s letters told a story of deepening woe. Despite the best efforts of Admiral Montagu, the smugglers usually evaded detection. Unable to compete, Thomas junior had to slash the price he asked for Bohea. At last, on September 11, 1772, Hutchinson wrote to William Palmer, warning him that their partnership might have to end. Thanks to the inroads made by the Dutch, it would soon be impossible to sell an ounce of English tea. Palmer need not send any chests that autumn: the Hutchinsons had fifty already, which they could not shift. In the governor’s opinion, the business was doomed unless either the East India Company or the British Treasury stepped in with a solution. “Nothing will be effectual,” the governor wrote, “short of reducing the price in England to the price in Holland.” As a loyal servant of the empire, Hutchinson did not wish to see the threepenny Townshend duty abolished: for one thing, the British wished to use the proceeds to pay his salary. But something had to be done, or his son would lose his livelihood.16
Even if the voyage from Boston had been unusually long, this letter would have reached William Palmer well before Christmas. And when the Herries plan appeared in December, Palmer instantly saw that the proposals would destroy his friends’ business entirely. According to Herries, the company should flood the market in Holland, France, and Sweden with cut-price tea. But the price was already far too low in continental Europe: do as Herries suggested, and it would fall still further. The same cheap tea would cross the Atlantic, leaving the Hutchinsons no option but to sell their own tea at a loss.
Like every wholesale dealer in tea, William Palmer held some stock in the East India Company, giving him the standing to object to a scheme so ill-judged. At the committee meeting on January 5, he did his best to defeat the Herries plan. In the weeks that followed, it underwent a transformation at the hands of Palmer, Crichton, and the Treasury. Between them, they took the plan and bent it into the disastrous form that would lead to the Tea Party.17
THE UNDERLINGS OF OFFICE
More banks collapsed, this time in Holland; troops were called out in Scotland to put down riots by the poor; and in London the Countess of Rochford lay dead, leaving her unfaithful husband prostrate with grief and shame. The new year of 1773 began with few rays of light amid the gloom. At India House, it took two full days for the directors to discuss the Herries proposals and to hear from William Palmer. Unable to make up their minds, they opted for caution. They would seek Lord North’s permission for a small, experimental shipment of tea to Amsterdam. In the meantime, the company wrote to the Dutch bankers Hope & Company, asking their opinion about the state of the market in Holland.18
On January 7, the East India shareholders met again with only one item on their agenda. George Johnstone rose to urge the meeting to support the Herries plan. By now, however, Crichton had clearly heard the objections, voiced by William Palmer and others, and so he leaped up to suggest an amendment. Send all the surplus tea to Europe, and the smugglers would bring it straight back to England. Better, said Crichton, simply to slash the price of tea in London and let anyone buy it who wished to do so, Englishmen and foreigners alike.
Then he added another suggestion. Everybody knew about the smuggling epidemic in America, and the West India lobby to which he belonged shared the government’s irritation. So why not ask Lord North to help with that as well? Would it not be simpler for his lordship to remove the threepenny Townshend tax and allow them to send their tea to America free from every duty? At that moment the scheme to send the surplus tea to the colonies was born. An excellent idea, said George Johnstone, who immediately rose to support it. Johnstone drafted a resolution, urging the board to ask for an act of Parliament allowing the company “to export their tea to foreign markets, clear of all drawbacks and duties,” including, of course, the Townshend duty. The motion passed unanimously.19
From January 1773, a cartoon satirizing the plight of the East India Company, with its chairman Sir George Colebrooke—nicknamed Shah Allum, because he lost heavily by speculating in alum, a mineral used in the textile trade—under attack at a shareholders’ meeting. The diminutive Colebrooke is being shaken in the air by the tall Scottish dissident George Johnstone. Below, the company is heading for the rocks. Library of Congress
Four days later, Sir George Colebrooke went cap in hand to Lord North to reopen their discussions. With its reserves of cash all but exhausted, the East India Company urgently needed to borrow £1.4 million from the Treasury, but in return for his consent North still insisted on reform of the company’s affairs. Already, the Secrecy Committee had begun to publish its report in installments—there would be eight in the space of six months—exposing fresh scandals in Calcutta and negligence or worse by the directors. Made to take most of the blame, Colebrooke found himself “pelted at & disavowed by everybody,” said a contemporary. Meanwhile, the Bank of England was close to calling time on the company’s overdraft.20
Even so, the tortuous process of negotiation dragged on until May. It took that long for Lord North to develop his own plan for a new system of government for Bengal, answerable to Parliament. But in one crucial respect Lord North was only too happy to help immediately. As early as January 14, he agreed to allow the company to send tea directly to America. Indeed, somebody—it is not clear whether it was the company or Lord North—proposed a still more radical initiative. In the future, two ships each year would be allowed to sail from China to the colonies, laden with tea, as a way to cut out all the middlemen and make the stuff even cheaper. Whoever suggested this, North gave the concept his full support.21
By now it was obvious that the original Herries plan was doomed. It finally died on January 20, killed by a letter from the Hopes. It was ingenious, they said, but utterly impractical—for the obvious reason that so many others had already pointed out. The Europeans liked fine green teas, but they did not care for the company’s vast stock of black Bohea and Singlo. Ship it to Amsterdam, and it would simply flow back across the
North Sea illegally. But even as the Herries plan expired, Lord North and his colleagues were busy with a variation of their own. Whatever the likes of William Crichton might suggest, the Treasury had not the least intention of abolishing the Townshend duty. On the contrary: North planned to leave the threepenny duty very firmly in place. He intended to use the company’s tea to make Americans pay the tax they tried so hard to evade.
Thirty years later, an old, forgotten man living close to poverty, Sir George Colebrooke wrote a candid set of memoirs. Never intended for publication—his book was printed only a century later, and copies remain extremely rare—it gives an insider’s view of what followed. Although Sir George rather liked Lord North—he called him “the best-natured man that could be”—he took a dim view of his skill with finance. Most tellingly of all, he blamed North for the decision to send the tea to the colonies. A wild and foolish scheme, it was bound to cause violent
opposition because, said Colebrooke, “it was calculated to carry into effect the payment of an obnoxious duty.”
According to Sir George, the blame lay entirely with Lord North and what he called “the underlings of office,” whom he accused of using every devious tactic to make the East India Company do as they wished. Colebrooke did not name the underlings in question, but he must have been referring to North’s two closest aides at the Treasury. One was Charles Jenkinson, later the first Earl of Liverpool, and the other was John Robinson, a plain-speaking lawyer from the far north of England. While Jenkinson was tall and lean, Robinson was coarse, fat, and untidy. However, both men were shrewd and cunning, and they worked tirelessly in the Commons as whips for the government side.22
One biographer of Jenkinson describes him as “a born bureaucrat of restricted sympathies,” which certainly did not extend in America’s direction. Another protégé of George Grenville’s, Jenkinson bitterly regretted the repeal of the Stamp Act, and he clung to Grenville’s dream of raising a colonial revenue. A man with an eye for detail, he served as the secretary of the committee investigating the East India Company. When Jenkinson died, he left behind a huge archive of papers. Among those relating to Bengal, a document survives that explains the Treasury’s thinking as clearly as could be.
Dated January 18, 1773, the document describes a plan to compel the Americans to buy all their tea from England. No one signed it. But judging from the array of figures it contains, and the care with which it was written, the paper can only be an official memorandum from the Treasury prepared by Jenkinson and Robinson, with perhaps some help from William Palmer. In six months’ time, the writer said, the East India Company should hold a special public auction of nine million pounds of tea. It would be sold at a discount, purely for export to Ireland and the colonies, where the Townshend duty would still have to be paid. The delay was deliberate. It would allow for the auction to be widely advertised on the other side of the Atlantic.23
“Very large orders from America may be expected,” said the writer, because the price would beat anything a Dutch smuggler could offer. Shopkeepers in the colonies would have no choice but to buy the tea, and so, at a stroke, the plan would accomplish four separate objectives. For the company, it would raise more than £900,000 in cash; it would oblige the Americans to pay the threepenny tax, putting an end to their foolish boycott; it would put the smugglers out of business; and it would raise some revenue for the government.
By the time the tea ships left for the colonies that autumn, the scheme had been revised: William Palmer intervened again, and the idea of an auction in London was dropped in favor of direct export by the company. But the plan’s underlying principles remained intact. By the end of January, the Treasury had committed itself to the course of action that led to the Tea Party. As far as it was concerned, it had no alternative. The Treasury had to act firmly to end the crime wave on the coast of America.
The previous summer, Charles Jenkinson had sat alongside Lord North in the Treasury boardroom when they heard the shocking details of the Gaspée raid. By the end of January 1773, the commission of inquiry into that affair had only just begun to meet at Newport. But already the navy had written home to London, complaining about the obstruction it met as it tried to find testimony against the Browns. It seemed unlikely that justice would be done in the case of the wounded lieutenant. Meanwhile, the cost of governing the colonies increased with each month that went by. As the price of food rose, the contractors who supplied the garrisons in New York and Boston began to plead for more money. Each dispatch from General Gage carried more warnings about the danger of an Indian war, while in the West Indies fighting had already begun on the island of St. Vincent.
There, the redcoats and the Caribs had been locked in combat since the autumn, and the army suffered grievously as men died in their hundreds from fever if not from wounds in battle. It took six months of fighting, and the deployment of more than two thousand soldiers, before the Caribs laid down their arms. In view of all this, how could the Treasury make concessions to the colonies? With money so tight, how could North abolish the tax on tea? It was simply unthinkable. Besides, Lord North could rely on the House of Commons to support him whenever he revealed the details of the plan.
But for the time being, Lord North still held his hand very close to his chest. In April, the company would choose a new board of directors. Inevitably, Colebrooke and his allies would be voted out, and North hoped to see them replaced by more pliable men who would readily accept all his proposals for reform. In the meantime, he continued to negotiate, but he said little in public. Three months passed in this way. All the while the newspapers eagerly followed the East India crisis, but without an inkling of what the Treasury had in mind. Instead, it was widely assumed that in due course Lord North would give the shareholders what they wanted and allow the company to send its tea to the colonies free from every tax.
One American in London certainly expected that: Benjamin Franklin. Like so many others, he failed to anticipate the crisis that was in gestation. Sixteen years had passed since Franklin came to live in England. There he did a great deal of science and a little diplomacy, as the agent for the colony of Pennsylvania and for the Massachusetts House of Representatives. For most of his time in the metropolis he remained a friend of the empire, and of course he thoroughly enjoyed the intellectual society he found. By 1773, however, his mood had changed to one of weary disenchantment with the British. But rather than seeking to gather intelligence about Lord North’s intentions, he gradually lost connection with the politics of the day.
His treatment by Lord Hillsborough had been discourteous and dismissive; the former colonial secretary refused to accept Franklin’s credentials to speak for the Massachusetts assembly. However, the change in Franklin’s attitude arose from far more than a fit of pique. As he traveled to Ireland and Edinburgh and saw the deepening divide between poverty and wealth, Franklin also grew more skeptical about the mother country. Although he came away unharmed by the financial crash—he was too shrewd to place his money in a British bank—the banking crisis increased his sense of disillusionment. Meanwhile, the endless delays about the Ohio question left him all the more frustrated.
As time went by, Benjamin Franklin gradually became detached from the mainstream of London society. Absorbed in his reading and research and ill at ease with the aristocracy, he chose to spend his evenings with freethinking clergymen, philosophers, and doctors. Clever they might be, but they were mostly radicals and nonconformists, in religion and much else. In an age when the Church of England still commanded the allegiance, however cynical, of the vast majority of people in public life, Franklin’s circle was hardly a fair cross section of opinion in the capital.
Benjamin Franklin in 1782, by Joseph Wright of Derby. Bridgeman Art Library
From the letters that survive, it seems that Franklin barely knew the Rockinghams at all. He saw nothing of Edmund Burke, with whom he might have collaborated to defend American interests. Unlike the Lees from Virginia, Franklin never dined with Wilkes, whom he did not trust. He also kept his distance from East India House. Of course he read the newspapers, but they were a baffling mixture of truth and falsehood. He rarely entered the drawing rooms of Mayfair or St. James’s where the influential gathered. Above all, Franklin misjudged the calibre of Lord North. The two men hardly knew each other: they apparently met only two or three times. Soon after North became prime minister, Franklin attended one of the weekly levees that he held in Whitehall and heard him make a disparaging remark about America. Although Franklin continued to meet other members of the government, henceforth he avoided the politician whom he most needed to understand.*5
Isolated from the court and from high society, all Franklin could see was incompetence. With some arrogance of his own, instead of trying to learn Lord North’s secrets he tended to regard the prime minister as a fool. “A fine Hobble they are all got into,” Franklin wrote to an American friend, early
in 1773, “by their unjust and blundering Politics with regard to the colonies.” His comments were not unfair, but in a sense they were naive. Actually, North was a man at the height of his powers. Far from doubting his abilities, the king and his fellow ministers admired the way he managed the East India crisis. And with Hillsborough out of the way and the opposition in the doldrums, at last Lord North was free to devise his own policy for America; but at this crucial moment, Franklin—a scientific genius, but temporarily off his political guard—failed to see that this was so.
Toward the end of March, Franklin went to see Lord Dartmouth, with whom he was never close. It was only their third interview since Dartmouth took office. Their relationship was cordial but no more. Despite his respect for the minister, Franklin came away from the session perplexed by what appeared to be mixed signals. Only a few months earlier, Dartmouth had seemed relaxed, willing to listen to colonial opinion. Even then, in January, Franklin had found that while his lordship was friendly, he was evasive too, speaking in vague clichés. By the spring, the minister’s mood seemed to have altered again. While Dartmouth remained an affable host, he showed signs of annoyance with the radicals in New England, their boycott of tea, and their refusal to help bring the Gaspée raiders to book. But the colonial secretary gave no clue about his own intentions.