Benjamin Franklin and the Economy of the Colonies - Essay Example

Reacting to the advocates of the Stamp Act who claimed that the Seven Years War had been waged to the detriment of Britain to protect the interests of Native Americans, Franklin referred once again to the fur trade subject: “The last war was begun, not ‘for the immediate protection’ of all Americans, but for the protection of British trade, carried on with British manufactures among the Indians in America” (Greene 1995, 261). Franklin also commented on the dispatching of Braddock’s army by the Crown to America as a way to safeguard British trade and that the “trade with the Indians, though carried on in America, is not an American interest” (Greene 1995, 261).

The war had been waged to create new markets for English producers and traders, and, as argued by Franklin, should justly shoulder the burden of maintaining the army (Isaacson 2003) that at the time inhabited the colonized lands. Economic Structure of the Colonies In a working colonial economy, the capitalist interconnectedness of the colonies and the mother country generally resulted in a colonial imbalance of trade. The colonies pay for the products of the mother country and are pushed to produce those unprocessed materials needed by the colonial capitalists.

In this process they are backed up by the new capital and investment of the balances of the mother country (Beer 1958). Hence, in the southern settlements, tobacco mostly was being generated to supply revenues for the British products the plantation owners needed; yet, since the trade left the British with a positive balance, its capitalists had by the 1770s at least ?4,000,000 spent in southern planting activities (Wahlke 1962, 1). To pay for the fees on these arrears, according to Wahlke (1962), southern planters were forced to continuously broaden their agricultural activities and to take part in the secondary operations of the fur trade and land assessment.

Evidently, the northern colonies were a source for iron, whale products, furs, and lumber, and these Britain greatly required sustaining her autonomy of European supplies. Through payments, the loosening of trade limitations and the rewarding of preferred places in the main market, Britain tried to persuade these businesses, in part because it needed these materials and in part to deflect northern capital from reaching into manufacturing, shipping, and shipbuilding (Greene 1995). Yet, the policy was a failure.

The northern colonies were purchasing more and more volumes of British products and services, and were hence heavy debtors in the direct trade (Greene 1995). Obviously, these economic systems only benefited the British capitalists and merchants in terms of favorable balances. The colonies in turn were increasingly buried in debt. In the system of mercantilism, colonies were obliged to support the mother country in gaining an export surplus, economic independence, and favorable balance of trade.

Colonies were obliged to provide supplies which would otherwise have to be acquired from non-colonial reservoirs, produce exports by the manufacture and trade of goods in high demand in other markets, and supply a market for the exports of the mother country (Greene 1995). In return, the mother country would furnish the settlements with military protection, and centralized regulation of the economy. But mercantilism was ‘not an American interest’