Merchants and Revolution

"Narrowly, the empirical stuff is on the early 17th century, but there is a very long postscript at the end of the book where he takes the story up until 1688-9. The central argument of Brenner’s book is that the real revolutionary change happened in the mid-17th century, and what happened in 1688-9 was a bit of a mopping-up operation. The really important contribution that Brenner made was to reintegrate social and economic history into the political history. For me, that was an incredibly important move. The second contribution that Brenner made was to show how important extra-European affairs were in the politics of the 17th century. The protagonists of his story are a group of people whom he calls “the colonial interlopers”. These are people who make it by getting involved in long-distance trade to North America and the West Indies and to some degree to India, and the role that they play in transforming the English polity. That got me thinking about how important things like the East India Company, extra-European trade and extra-European politics were in creating the dynamics that made the revolution. The argument that Brenner tries to make is that in the late 16th and early 17th centuries, England transforms from being a relatively backward European state into a commercially dynamic society, and that needs to be taken into account in any story about English politics in the 17th century. This prior agrarian transformation had very complicated origins, but the dynamic area of English economic growth in the 17th century was very much long-distance trade. What I try to do in my book is to follow up on these themes, but to think especially about the comparative context that you suggest. Why did England – which was a relatively backward state in the 16th century – become the first industrial nation? Why did it overtake the Netherlands? One of the things that I point out is that between 1640 and 1700 all of Europe was in recession except for the Netherlands and England, and that creates a remarkable dynamic. It’s precisely the fact that England was growing economically when the rest of Europe wasn’t that informed a lot of the politics of the later 17th century. But it was also the case that while both England and the Netherlands were growing, England, in the later 17th century, was beginning to catch up with the Netherlands. This was partly because the Dutch had to deal with a number of Continental rivals. Also, one of the things that I try to suggest in my book is that the Revolution of 1688-9 actually created economic institutions in Britain that surpassed those of the Netherlands. One good example is the creation of the Bank of England in 1694. The difference between that and the Bank of Amsterdam was that the Bank of England gave interest on deposits, whereas the Bank of Amsterdam didn’t. The other huge difference is that the Bank of England gave low-interest loans to manufacturers, so they could borrow money to get start-up capital to develop manufacturing. The Bank of Amsterdam didn’t do that. Part of what I’m arguing is that the Revolution of 1688-9 was absolutely vital in England and then Britain ultimately surpassing the Netherlands as an economic power. There was a pan-European discussion of these things. They’d been better institutionalised in the Netherlands, but after the revolution there was a climate of institutionalisation of a lot of these economic “projects” as Daniel Defoe called them. The revolution was absolutely important for them, but I wouldn’t say they were brought over with William. For example, there was a lot of discussion about creating a bank in England from the 1650s onwards. It only gets implemented in the 1690s, but given how innovative the Bank of England was as an institutional design, I wouldn’t want to say the ideas came from the Netherlands. England had this real problem. They got involved in a huge continental war with extremely antiquated financial institutions. They had to develop new ones, and William was willing to turn to people who were willing to innovate. These tended to be Whig political and economic leaders. These people developed their own economic ideas, but they were deeply influenced by the Dutch. Charles Montagu, for example, who becomes Earl of Halifax and the great financial genius of the 1690s, is somebody who spent quite a lot of time in the Netherlands and understood Dutch economic institutions from the inside. But he didn’t merely mimic them – he adapted them to an English situation."