Friday, June 2, 2017

The Jay Treaty, Part III: Text

            The treaty that John Jay presented to his countrymen upon his return from London in June, 1795 was arguably not what either the Federalist or Republican political factions hoped it would be. While, if ratified, it stood a very good chance of averting armed hostilities between the United States and Great Britain, it hardly represented a diplomatic coup on the part of the American republic. Upon reviewing its terms, Jefferson and his partisans decried it as a rank capitulation to British interests and Jay a traitor who had sold the independence of the United States to Great Britain in order to preserve the commercial interests of his merchant allies in New York and New England. While Hamilton and his Federalists allies in large part disagreed with this characterization, they too found fault with the document that Jay had helped craft. The accord, the Secretary of the Treasury privately confided, was “execrable” and “an old woman’s treaty,” though he also opined that its rejection, “Would greatly shock and stagnate pecuniary plans and operations in general.” Indeed, it seemed that almost no one in the contemporary United States was particularly pleased with the settlement that their chosen envoy had managed to secure. It was too generous to Britain, some said, and not generous enough to the American republic; it represented an unpardonable injury to American national honor, and stood to visit great harm upon American commerce. Granting that there was some truth to all of these allegations – and that the various public and private expressions thereof will be discussed at length in weeks to come  – it will remain for the present to address a far simpler enquiry.

            What was it that the Jay Treaty actually said?

            Across twenty-eight articles, the Treaty of Amity and Commerce focused on and returned to a number of key themes or policy areas of particular significance to the Anglo-American relationship. For the purpose of summary, these in turn might fairly be condensed down to three basic headings: trade, standing grievances, and the exigencies of war. The first concerned matters of private business, travel, taxation, and commercial access – who was required to pay import duties, on which goods, in which ports, under what circumstances, etc. The second dealt with issues of sovereignty, security, and property that had either persisted since the ratification of the Treaty of Paris (1783) or arisen in the years that followed – the continued British occupation of American territory and seizure of American merchant ships, the American non-payment of British-held debts, and so forth. The third, and perhaps the most immediately significant, concerned the pressures that the ongoing war in Europe exerted on both the United States and Great Britain and need to prevent those pressures from transforming a simple misunderstanding into a formal armed conflict – the needs of the British war effort as balanced against the dignity and independence of the United States. With a few minor exceptions, every article of the Jay Treaty can be slotted into one of these three categories. For that reason, they will form the basis of the synopsis that follows.

            And so…   
Under the heading of trade, the Jay Treaty had a great deal to say. Given the sheer volume of commerce conducted between the two signatories – Great Britain and the United States of America – at the end of the 18th century, this should come as little surprise. Though the late Revolution had severed formal political ties between the mother country and its former colonial dependency, Britain remained the largest single purchaser of American produce into the 1790s, and the United States one of the largest customers for British manufactured goods. In order to ensure that the resulting commercial relationship – and the wealth that it generated on both sides of the Atlantic – remained on a stable footing for the foreseeable future, it only made sense for both parties to develop a clear understanding of what each expected of the other, their respective priorities, and the privileges they were willing to extend. Article 3 first attempted to accomplish this by defining precisely who and under what circumstances persons could travel and transact business between the United States and Britain’s remaining territory in North America. Subjects of the British Crown and citizens of the United States alike – as well as “the Indians dwelling on either side of the said Boundary Line” – were accordingly granted the right, “Freely to pass and repass by Land, or Inland Navigation, into the respective Territories and Countries of the Two Parties on the Continent of America [.]” This permission was further augmented by allowing the concerned parties, “To navigate all the Lakes, Rivers, and waters thereof, and freely to carry on trade and commerce with each other [,]” though not extending to their respective, “Sea Ports, Harbours, Bays, or Creeks [.]”  Combined, these regulations would seem to indicate that Great Britain was prepared to allow the United States to carry on an overland trade with its North American colonies while reserving the ocean trade with the same to its own merchants. 

            As to the goods that were to be transported between British North America and the United States, Article 3 further specified that all merchandize not otherwise prohibited could be carried into or out of either territory, by residents of either territory, and on an equal basis. In so doing, American merchants transporting goods into British North America would be subject to, “No higher or other Duties” than would be owed by British merchants engaged in the same trade, and vice versa. In addition, duties would not be levied on furs brought into either territory, and the native inhabitants thereof would be permitted to pass from one side of the boundary line to the other, free form any imposts or taxes so long as they only carried, “their own proper Goods and Effects of whatever nature [.]” This duty exemption was also extended to all those goods, “Which shall merely be carried over any of the Portages, or carrying Places on either side, for the purpose of being immediately reimbarked, and carried to some other Place or Places.” In light of recent commercial tensions – the seizure of American merchant vessels by the British Navy, resultant threats of an American embargo on British goods, etc. – provisions such as these were doubtless expected and welcomed by both of the relevant parties. British North America represented an obvious source of potential customers for American products, and access to markets in the United States presented an obvious goal for British merchants operating in what were then Upper Canada and Lower Canada. A high degree of clarity, efficiency, and cooperation thus stood to benefit all involved. 

Passing over Article 11 – which was nothing more or less than a brief preamble for what followed – the twelfth through the sixteenth articles of the Jay Treaty further expanded upon the initial clarification of trade priorities, concessions, permissions, and exemptions embodied by Article 3. To that end, Article 12 set about defining trade relations between the United States and the British West Indies. In so doing, the text made careful note of the size of vessels permitted to enter British ports in the Caribbean (no more than seventy tons), the kinds of goods allowed to be transported to the same (only those, “Being of the Growth, Manufacture, or Produce of the said States”), the import charges to be paid on such goods (“No other or higher […] than shall be payable by British Vessels, in the Ports of the United States”), and the manner of products permitted to be carried away on American ships (all those considered to be of the, “Growth, Manufacture or Produce of the said Islands”). Article 13, which conversely endeavored to regulate American seaborne trade with the British East Indies, was only slightly less explicit in its terms and conditions. American vessels, it stated, would pay the same duties as would British vessels in American ports, were permitted to purchased and remove, “All articles of which the Importation or Exportation […] shall not be entirely prohibited [,]” and could only export cargoes purchased in the East Indies to, “Some Port or Place in America [.]”

Article 14 then proceeded to clarify the notably more generous terms applied to trade between the United States and Britain proper. The American republic and Great Britain, it rather vaguely declared, were to enjoy, “A reciprocal and perfect liberty of Commerce and Navigation.” The subjects and citizens of each nation could pass back and forth from one to the other, “Without hindrance and molestation,” land their ships at whatever port, or city, or river they cared to, take up residence, rent warehouses to store their property, and generally enjoy, “The most complete protection and Security for their Commerce [.]” This batch of territorial trade regulations – articles 12, 13, and 14, referring respectively to the West Indies, the East Indies, and Britain itself – was then followed by a rather dense summation of all remaining tariffs and duties to be charged and collected by the relevant parties. In the form of Article 15, this passage described the imposts that would be laid upon certain goods arriving in or departing from British or American ports, what relation these duties would have to those laid upon articles imported or exported from any other nation or nations, and the various potential exceptions to these regulations that Britain in particular felt it necessary to reserve. Article 16 then proceeded to acknowledge the right of both parties to appoint Consuls for the purpose of protecting and monitoring their respective commercial interests in the each other’s territory, with the caveat that either the United States or Great Britain, “May except from the residence of Consuls such particular Places, as such party shall judge proper to be excepted.” 

It is worth noting, before advancing to the second topic heading under which the various articles of the Jay Treaty arguably fall, the evident presence of a unifying rationale across the sections just now discussed. Granting that the document in question represents a bilateral agreement between two distinct – and theoretically equal – parties, the density, specificity, and structure of the relevant commercial regulations would seem rather strongly to indicate the ascendancy of British priorities over American. Take, by way of evidence, the descending severity of trade terms applied to American merchants in the West Indies, the East Indies, and Britain proper. American traders, eager to carve out a place for themselves in a global economy dominated in the late 18th century by established European powers, would doubtless have preferred to access every corner of the British Empire on the same generous conditions as spelled out in Article 14. From the perspective of competitive, monopolist Britain, of course, such an concession to a potential rival was wholly unacceptable. The economy of its globe-spanning empire was vast, complex, and precisely balanced. Increasing taxes here was meant to increase revenues there, and fund military expenditures, and decrease demand for certain commodities, and so on, and so forth. In consequence, though the government of Prime Minister William Pitt was, circa 1794, willing to grant the United States access to certain markets within the larger British imperial economy, this access was bound to be accompanied by a great many restrictions, regulations, and precisely-worded caveats.      

 To that end, recollect once more the terms of articles 12, 13, and 14 of the Jay Treaty. The first, concerning the West Indies, placed the most specific restrictions upon American trade in any region of the British Empire. There was, in point of fact, a very good reason for this. As sugar-producing islands like Jamaica and Saint Kitts represented the figurative jewels of the contemporary British imperial economy, British trade ministers had every reason to desire to protect their nation’s ability to successfully extract the wealth thereof. And as that these same cash-crop islands required foodstuffs to be brought in by ship, and as the United States represented the closest and largest source of the same, permitting unfettered American access to local markets posed a serious possible threat. If merchants from the United States, free to come and go as they pleased, simply traded their staple provisions for molasses, coffee, or cacao which they then sold in European markets, Britain might quickly have found itself economically displaced. Instead of representing a costly venture – in terms of defense and provisioning – that paid off only if properly attended to, the West Indies might thereafter have become a lodestone around Britain’s neck that filled the coffers of American merchant cartels while demanding nothing in the way of expenses from the American government. Permitting American vessels operating in the Caribbean to purchase and transport certain commodities only if they were bound for American ports – thus forfeiting the profits of some portion of the sugar and coffee that British trade policies had endeavored to produce – accordingly represented a concession that still managed to preserve the core of Britain’s commercial interests.

Articles 13 and 14 appear similarly representative of mid-18 century Britain’s highly complex and carefully calculated approach to commerce. That the former placed less specific – though in some cases more broad – restrictions upon American trade in the East Indies than Article 12 did for the West Indies speaks to the position then enjoyed by British merchant cartels in the contemporary Indian Subcontinent. While the British East India Company was a major player in only a handful of territories, worked in large part through native intermediaries, and was in the midst of an often bloody competition with its French counterpart, the British government was doubtless still quite keen on heading off any potential disruption of the monopoly that British traders were attempting to construct. The United States of America most assuredly represented just such a potential disruptive influence. If American merchants managed to find ways to work cheaper, for instance, or secured favorable agreements with certain native princes or potentates eager to offset East India Company influence, Great Britain could potentially have found itself priced out or forced out of the East Indies market. Attempting to regulate American trade with the Indian states – by allowing American vessels to trade in the East Indies only so long as they sold their cargoes in the United States – therefore accordingly represented a means of preserving the sphere of control British traders were attempting to erect in contemporary South Asia.

Much the same logic – i.e. holding American trade priorities second to the commercial needs of the larger British Empire – might be seen to explain the substance of Article 14. As the contemporary United States wholly lacked a manufacturing sector that could compete with Great Britain’s emerging industrial might, there was simply no need to protect British factory owners from overseas competition by erecting tariff barriers against the United States of America. The American republic was a nation of farmers in the middle 1790s, and British trade ministers were doubtless entirely confident that their nation could afford to purchase the (much-needed) produce of the United States while still reaping a profit by selling luxury goods, farming implements, and textiles back across the Atlantic. In the event that this proved not to be the case – if, say, the United States attempted to tweak the balance of trade between itself and Great Britain by putting forth certain regulatory measures of its own – Article 15 provided a combined preventative measure and potential solution. The British government, it read, would retain the right to impose further duties on American vessels, “As may be adequate to countervail the difference […] now payable on the importation of European and Asiatic Goods when imported into the United States in British or American vessels.” What this meant, in essence, was that Britain could effectively raise the cost of imported American goods in order to offset any harmful price difference between cargoes being brought to the United States in American vessels versus British vessels. Article 15 also prohibited the government of the United States from assigning additional duties of its own on British imports that would further increase this selfsame price difference. Combined with the aforementioned twelfth, thirteenth, and fourteenth articles, this attempt at effectively slotting the United States of America into the larger British imperial economy stands in evidence both of contemporary British commercial expectations – i.e. that regulating trade was a complex business, and that all those eager to participate would need to observe that complexity – and the willingness of the Washington Administration to submit to the same in exchange for access to certain high-value markets.

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