The prolonged wars had also revealed the need to tighten the administration of the loosely run and widely scattered elements of the British Empire. If the course of the war had confirmed the necessity, the end of the war presented the opportunity. The acquisition of Canada required officials in London to take responsibility for the unsettled western territories, now freed from the threat of French occupation. The British soon moved to take charge of the whole field of Indian relations. By the royal Proclamation of 1763, a line was drawn down the Appalachians marking the limit of settlement from the British colonies, beyond which Indian trade was to be conducted strictly through British-appointed commissioners. The proclamation sprang in part from a respect for Indian rights (though it did not come in time to prevent the uprising led by Pontiac). From London’s viewpoint, leaving a lightly garrisoned West to the fur-gathering Indians also made economic and imperial sense. The proclamation, however, caused consternation among British colonists for two reasons. It meant that limits were being set to the prospects of settlement and speculation in western lands, and it took control of the west out of colonial hands. The most ambitious men in the colonies thus saw the proclamation as a loss of power to control their own fortunes. Indeed, the British government’s huge underestimation of how deeply the halt in westward expansion would be resented by the colonists was one of the factors in sparking the 12-year crisis that led to the American Revolution. Indian efforts to preserve a terrain for themselves in the continental interior might still have had a chance with British policy makers, but they would be totally ineffective when the time came to deal with a triumphant United States of America.
PontiacPontiac, chief of the Ottawa tribe, hand-coloured engraving.© North Wind Picture Archives
The tax controversy
George Grenville, who was named prime minister in 1763, was soon looking to meet the costs of defense by raising revenue in the colonies. The first measure was the Plantation Act of 1764, usually called the Revenue, or Sugar, Act, which reduced to a mere threepence the duty on imported foreign molasses but linked with this a high duty on refined sugar and a prohibition on foreign rum (the needs of the British treasury were carefully balanced with those of West Indies planters and New England distillers). The last measure of this kind (1733) had not been enforced, but this time the government set up a system of customs houses, staffed by British officers, and even established a vice-admiralty court. The court sat at Halifax, Nova Scotia, and heard very few cases, but in principle it appeared to threaten the cherished British privilege of trials by local juries. Boston further objected to the tax’s revenue-raising aspect on constitutional grounds, but, despite some expressions of anxiety, the colonies in general acquiesced.
Parliament next affected colonial economic prospects by passing a Currency Act (1764) to withdraw paper currencies, many of them surviving from the war period, from circulation. This was not done to restrict economic growth so much as to take out currency that was thought to be unsound, but it did severely reduce the circulating medium during the difficult postwar period and further indicated that such matters were subject to British control.
Stamp ActProcession in New York opposing the Stamp Act, depicted in a hand-coloured woodcut. © North Wind Picture Archives
Grenville’s next move was a stamp duty, to be raised on a wide variety of transactions, including legal writs, newspaper advertisements, and ships’ bills of lading. The colonies were duly consulted and offered no alternative suggestions. The feeling in London, shared by Benjamin Franklin, was that, after making formal objections, the colonies would accept the new taxes as they had the earlier ones. But the Stamp Act (1765) hit harder and deeper than any previous parliamentary measure. As some agents had already pointed out, because of postwar economic difficulties the colonies were short of ready funds. (In Virginia this shortage was so serious that the province’s treasurer, John Robinson, who was also speaker of the assembly, manipulated and redistributed paper money that had been officially withdrawn from circulation by the Currency Act; a large proportion of the landed gentry benefited from this largesse.) The Stamp Act struck at vital points of colonial economic operations, affecting transactions in trade. It also affected many of the most articulate and influential people in the colonies (lawyers, journalists, bankers). It was, moreover, the first “internal” tax levied directly on the colonies by Parliament. Previous colonial taxes had been levied by local authorities or had been “external” import duties whose primary aim could be viewed as regulating trade for the benefit of the empire as a whole rather than raising revenue. Yet no one, either in Britain or in the colonies, fully anticipated the uproar that followed the imposition of these duties. Mobs in Boston and other towns rioted and forced appointed stamp distributors to renounce their posts; legal business was largely halted. Several colonies sent delegations to a Congress in New York in the summer of 1765, where the Stamp Act was denounced as a violation of the Englishman’s right to be taxed only through elected representatives, and plans were adopted to impose a nonimportation embargo on British goods.
A change of ministry facilitated a change of British policy on taxation. Parliamentary opinion was angered by what it perceived as colonial lawlessness, but British merchants were worried about the embargo on British imports. The marquis of Rockingham, succeeding Grenville, was persuaded to repeal the Stamp Act—for domestic reasons rather than out of any sympathy with colonial protests—and in 1766 the repeal was passed. On the same day, however, Parliament also passed the Declaratory Act, which declared that Parliament had the power to bind or legislate the colonies “in all cases whatsoever.” Parliament would not have voted the repeal without this assertion of its authority.
Charles Watson Wentworth, 2nd marquess of RockinghamMary Evans Picture Library
The colonists, jubilant at the repeal of the Stamp Act, drank innumerable toasts, sounded peals of cannon, and were prepared to ignore the Declaratory Act as face-saving window dressing. John Adams, however, warned in his Dissertation on the Canon and Feudal Law that Parliament, armed with this view of its powers, would try to tax the colonies again; and this happened in 1767 when Charles Townshend became chancellor of the Exchequer in a ministry formed by Pitt, now earl of Chatham. The problem was that Britain’s financial burden had not been lifted. Townshend, claiming to take literally the colonial distinction between external and internal taxes, imposed external duties on a wide range of necessities, including lead, glass, paint, paper, and tea, the principal domestic beverage. One ominous result was that colonists now began to believe that the British were developing a long-term plan to reduce the colonies to a subservient position, which they were soon calling “slavery.” This view was ill-informed, however. Grenville’s measures had been designed as a carefully considered package; apart from some tidying-up legislation, Grenville had had no further plans for the colonies after the Stamp Act. His successors developed further measures, not as extensions of an original plan but because the Stamp Act had been repealed.