Sun Never Sets on British Empire - Essay Example

How does the concept of the "imperialism of free trade" explain the rise and fall of the British Empire and Section # of course> British Empire is known to be one of the largest Empire in human history. It was once said, "Sun never sets on British Empire". The Empire doesn't only means to rule by political or by military but in modern times, it means to rule any region or territory economically. British Empire followed the same rule. The concept of Free Trade was given by the famous economist, Adam Smith. According to him, it is a path to success for a nation. It is true even in today's world. In 1820's the British Parliament passed the Statement of Principle that carries Adam Smith's idea of Free Trade. Though it took some time for other nations to understand this concept, but it is now a known phenomenon and is admired and adopted throughout the world. Free Trade Free trade is a type of trade between countries, where trade is done without any restrictions of governments from both sides. Different countries prefer free trade; the reason is that it provides benefit to people. The countries involved in free trade are usually on the friendly terms and in a way it shows their trust upon each other. Not only goods but also services are provided without taxes and other obstacles that could be faced otherwise. The main beneficiaries of free trade are the common people of those countries that get full advantage of low priced goods. A country, after getting privilege of free trade, can gain access to the market of the other country easily and they can invest their capital without any concern of the future policies of that country. Free trade is not a new phenomenon in the economies of the countries. It is been practiced for centuries in different forms. It is considered to be a vital factor of any country's flourishing economy and successful economic policies. This concept was given by the famous economist David Ricardo. Though the country with large and strong economy got a big share of profit than the other one, but still this phenomenon is popular in today's world. British Empire could be regarded as one of the largest empire in the world's history. They have controlled a large part of the land for a long period of time. The key to their success in this whole time was their strong economy. Their stable and strong economy leads them everywhere in the world and once they set their foot in the particular country, no one can stop them from achieving their imperialistic aims. Their influence was obvious in every field of that country, people follow their way of living and adopt their styles, and they finally took over that country or the region. The famous quote about them was that "The sun never sets on British Empire". The British Empire started arising in seventeen century, when they reconcile with their rival Spain in 1604. America is referred as their first colony and the list of colonies goes on, which includes a large part of land in almost every continent of the world. And they started this all with trade, either its Tobacco, Rice, Fur, Cotton, Raw Material or even slaves. Asia was considered to be Portugal's territory, but in the late 16th century, British and Dutch found their way in Asia as well, which at that time considered being a wealthy piece of land, especially India. East India Company was set in early 1600's and it provided British people to set their foot at in the rich and mysterious land of India, at that time was ruled by Mughals. The famous export of India was spices and textile. British lost their colonies in American Continent during 1760's to 1770's, and it was a great loss for the Empire. But they still got the Asia, a gold mine in their hands. Asia, particularly India, was considered to be the most profitable colony of British Empire and they earned a lot from this part of the land. At this time, Adam Smith gave the concept of Free Trade. According to him, it is not necessary to have a military or a political rule over a country, but a country can be ruled and governed by the means of Trade and economy. And Britain started their trade with the newly independent Americans. East India company had started setting their foot in India and they been given a privilege and permission of continuing their trade in India by the rulers of that time. Mughals gave them permission of trade and they never knew that one day British will over take their position and will rule their country for centuries. Though their main focus was trade in the beginning, but with the passage of time, they started taking interest in Indian politics and they came to know that Mughal Empire is weakening and it is easy to get a hold of this rich land and to rule it completely. The first territory that came under their full control was Bengal, they defeated French and Indian forces during a war and took control of the land and this opened a new era for British Empire. Another important colony of British Empire was Australia, formerly known as New Holland. Captain James Cook discovered this land in 1770. It became a British Colony in 1829. British government used to send their convicts and criminals in America, but after loosing their American colonies they started sending them to Australia. Trade of wool and gold gave a lot of profit to British Empire. The concept or idea of Free Trade in Britain emerges in 1840 to 1860, though the parliament passed the Statement of Principle, carrying the Adam Smith's concept of Free Trade. But it was carried out in 1840's and that is the reason why it is said to be the revolution of 1840. Initially, few agreements were signed with few countries for Free Trade and then the Corn Law came in 1846. It came in repeal of English Agriculture Protection and is considered to be unilateral. It gave some more power to the Empire and also profits. Free trade gave excessive profits to British investors and banks in different kind of trades, especially in Opium trade from China, the British Foreign Minister at that time persuaded China to open their sea ports for British Trade, which shows that how powerful the British Empire was at that time. One belief is that they went for Unilateral Free Trade because they couldn't convince any other nation to sign an agreement of Free Trade. So they cut off their tariffs and taxes, in order to reduce the prices of their goods. According to them, low cost goods would be beneficial to consumers as well as government, as it will reduce the overall business cost. It was an effort by British Empire to protect its trade and business from loss and also to compete with the other traders of the time that were emerging. But it actually makes the situation worse, especially for the British farmers, whose agricultural products were sold on cheap prices and were at a great loss at the time. Not only British, but Irish farmers were also affected by this Free Trade policy, they spent a tough time along with their families that took them to starvation. The famous Irish "Potato Famine" of 1845-1846 resulted after the Free Trade policy. However, the Irish farmers suffered more than the British farmers. Another result of this came out the extreme class differences between rich and poor, rich became richer and poor became poorer. Then the income tax bill 1842 was launched by Peel that tried to compensate the losses which were resulted after Free Trade policy. "It was aimed at providing compensation for initial losses in government revenue as tariffs came down, but it became a permanent feature of British finance thereafter, as we shall see." 1 Within three to four years, finance department succeeded in removing the duties on over four hundred goods. They retained the tariffs on some luxury items too; it helped in gaining the revenue. Duty was applied on four imported items tobacco, tea, spirit and wine. And it helped a lot in generating revenue for the government, as these goods are used by everyone in the country and their sale is never affected by any factor. It produced 95% of revenue.2 However, the support for Free Trade was still there. The supporters of Free Trade policy believe that it is aimed to reduce the class differences among the British Society. And also, according to them, it is a way to control the people and different groups of society and businesses who believe that they can control the government decisions by imposing their own verdicts or giving suggestions to the government. Still, Free Trade concept became popular in the whole country and among all classes of the British Society. They believe that government should not interfere in business and economic matters, though people were paying duties and tariffs for the goods but still this policy was gaining popularity among the masses. "The free trade system put in place by 1860 is usually seen as unique, but Nye has recently challenged this view. If the degree to which nations are free trading or not is determined by comparing net customs revenues as a percentage of the value of imports for each country, a comparison between British and French experience produces surprising results. Using this criterion, Nye has shown that British tariffs were not only higher than French in 1815, but that French duties remained lower even after the transformation effected by Peel and Gladstone. The position was not reversed until the late 1870s when French tariffs began to rise significantly."3 According to him, British Free Trade Policy could not be considered as unbiased, the duties on different goods from different countries were found different from the other so he states that the French economy was also a Free Economy as was the British. The following diagram shows the net customs revenue as a percentage of net import values for Britain and France.4 But Irvin disagreed with him and according to him French have imposed duties on almost every household item, but on the contrary, British have put duties on only selective items, only four items, wine, tea, tobacco and spirit. So according to Irvin, this is not an accurate method of finding out the authenticity of Free Trade Policy. British tried to implement the Free Trade Policy in other countries of Europe too; they tried to involve the common people as well. According to them, a common citizen must be excited about Free Trade, as it is beneficial to a common man than to anyone else in the country. However, they did not get any appreciative reaction from other countries, though an Anglo-French treaty was signed in 1860, and a unilateralist Richard Cobden played an important role in its formation. British expect that it will lower the tax rate among the Europe and also it will reduce the arms war in Europe. And it can be seen that the Free Trade Policy, that emerged from Great Britain is now a popular phenomenon in the entire world and almost all the countries are trying to implement this phenomenon to boost their economies. They gave the concept of MFN (Most Favorite Nation) and the MFN was given some extra privileges in regard of the bilateral trade and also multilateral trade. By the end of the same century, British started thinking the ways to strengthen their empire around the world that was spread in almost every continent. The other debate was to strengthen their economic position globally, they understand the need of time that only economically strong nation will survive in the end. The British Empire, however, had started becoming a burden instead of a profit. The nationalist movements in different colonies have made government think on its decision of colonizing the half of the world. Canada and Australia got independence in 1907 and 1931 and they willingly joined the common wealth. Imperialism is not only a political function, but it also demands a stable economy and constant funding. A colony could be in a new continent and the cost and other economic elements of that particular area also affect the Empire. Though they gave economical benefits to the Empire but these benefits could be given only when the region is secure and the investment done on the region is proved to be secure and the political and security conditions are stable in the region. As the British industry grew with the passage of time, their priorities also started getting change in accordance with it. Not all the regions gave the same level of profit and benefit to the Empire so why to keep the territory when it is not giving the enough profit and instead of profit it gives the loss. The new development in British Industry demands new policies regarding industries and infrastructure. Those demands must be fulfilled and it requires a lot of investment to accomplish all these tasks. This investment cannot be done on each and every territory, as each and every territory was not worth of this investment. British interests were not same for every region, some regions were only like a burden for the British Empire, though most of the regions were self governing but still they need extra staff which takes care of Empire's interest in the territory. And following these lines the expansion in the Empire was stopped and even many territories gain independence. British Empire had given their idea of Free Trade and after this idea there was no need to sit in a territory and govern it politically. Any Empire can govern a country without political and military power; the only power requires is the economical power. And the best tool for the economical power is Free Trade. Bibliography Cain, Refresh 29 (Autumn 1999) 2 Cain, Refresh 29 (Autumn 1999) 3 Cain, Refresh 29 (Autumn 1999) 4 J. V. Nye, 'The Myth of Free Trade Britain and Fortress France: Tariffs and Trade in the Nineteenth Century', Journal of Economic History, 51(1991), pp. 23-46. Angus Maddison. The World Economy: A Millennial Perspective (p. 98, 242). OECD, Paris, 2001. Bryant, Arthur. The History of Britain and the British Peoples, 3 vols. (London, 1984-90). Cain, P.J. and Hopkins, A.G. (1993) British Imperialism: innovations and expansion 1688-1914, Longman, London. Hyam, Ronald. Britain's Imperial Century, 1815-1914: A Study of Empire and Expansion (Macmillan, 1993). Olson, James S. and Robert S. Shadle; Historical Dictionary of the British Empire 1996 http://users.cyberone.com.au/myers/engdahl.html Read More