Commerce In the Revolutionary period

Commerce before the Revolution

Imports

The 18th century was marked with the Consumer Revolution which began in Europe and extended to the American ports. This period was ushered in by improvements in manufacturing, an increase in credit, and the expansion of globalization. As a result, colonists who previously relied on what was locally produced turned to imported items.

What were once considered luxury items became commonplace among upper class colonists. The usage of imported fabric in clothing displayed wealth and prosperity. These imports were sustained by the thriving British textile industry. Items made from silk were extremely expensive to import but would nonetheless be used in shoes and dresses of the genteel class.

Exports

In exchange for the imports supplied by Britain, the colonies were expected to produce exports that sustained the mercantilist empire. By the eve of the Revolution, the Southern colonies were key producers of the colonies main exports. Part of the reason was because farming in the Northern colonies had become more difficult as land was less available than in the South. The most lucrative crops in the South included tobacco, rice, indigo, and wheat. While both small farmers and large plantation owners contributed to exports, the latter were usually able to invest in the production of crops which were more expensive to cultivate, such as rice. To see how tobacco was transported and shipped, check out the video below with historical farmer Ed Schultz from Colonial Williamsburg.

The British government would also subsidize certain exports. For example, indigo planters received a subsidy for every pound of indigo they harvested starting in 1749. By 1775, South Carolina was producing over 1 million pounds of indigo for the British and the blue dye was important in supporting Britain’s textile industry. The labor intensive process of harvesting indigo also increased the demand for enslaved labor which was a cornerstone for the commerce of the colonies.

Trade Beyond Britain

Crops in the Southern colonies were regulated so that they could strictly only be exported to Britain. It is estimated that more than 75% of tobacco sent to Britain would then be shipped and sold across Europe. This often limited the trade and profit that farmers could make so many, including George Washington, would split their fields with various crops to a ensure sustainable production of exports.

Exports of the Mid-Atlantic and New England colonies were less restricted and officials would often ignore regulations given the smaller production size. In the Mid-Atlantic colonies this included wheat, cereals, and lumber. These raw materials would be distributed among the colonies as well as to Europe. In the New England colonies, exports included ships, coaches, candles, and dry fish.

The fur trade was also unique to this region and while some colonists harvested the furs themselves they would often trade with Indigenous people in the interior parts of the continent. In Rhode Island, rum was essential to the Transatlantic Slave Trade, as it would be taken to West Africa and bartered for enslaved people. The enslaved Africans would provide a constant labor supply which the Southern colonies depended on to produce their lucrative exports.

Commerce and the Revolution

Shifting exports

Following the start of the war, exports within the colonies were forced to adapt to the needs of troops and the closed British markets. In New England, fishermen volunteered their fishing vessels as warships for the Continental Army. Women throughout the colonies held spinning bees to make yarn in place of British textiles. In the South, the Virginia General Assembly stopped tobacco export to Europe in 1775 and farmers shifted to wheat production to feed troops. Nonetheless, tobacco would not become obsolete during the war as the Continental Congress would exchange it with the French for ammunition. Benjamin Franklin even used five million pounds of tobacco as collateral for a loan from the French government.

Following the war, the United States would have to diversify their exports, as lucrative crops like indigo greatly suffered from the British embargo of the United States exports. Nonetheless, the Southern colonies would soon find profit in the trade of cotton which would expand the trafficking of enslaved Africans.

Smuggling and Boycotts

Smuggling had been common practice prior to the Revolution in light of British restrictions on specific exports. In fact, it was such a common practice in the colony of Rhode Island that if a merchant was taken to court the judge would often side with the smuggling merchant or return the vessel after the trial.

Throughout the Seven Years’ War, colonists continued smuggling goods to the French. Fishermen in the New England region had contacts in the French West Indies and exchanged dry fish for rum and sugar. These untaxed goods would benefit not only the merchant but colonists who bought these imports. Consumers of smuggled goods ranged from all occupations and classes. In 1777, the diary of Reverend James Woodforde records:

“Andrews the smuggler brought me this night about 11 o’clock a bagg of Hyson Tea. He frightened us a little by whistling under the Parlour Window just as we were going to bed. I gave him some gin and paid him for the tea.” - March 29, 1777

These smuggling efforts were paired with boycotts from consumers that began before 1775 as well. The Stamp Act of 1765 resulted in the 1768 Boston Non-Importation Agreement, which successfully boycotted and overturned the Act. Individual colonies also made their own boycott agreements in response to the Tea Act in 1773. It was the success of these earlier efforts which would encourage the Continental Congress to issue a colony-wide boycott of all trade with Britain in 1775 along with the Declaration of Independence.

Once the war began, smuggling received a new legitimacy under privateering contracts. On March 23, 1776, the Continental Congress established the commission process on a per-voyage basis. The Continental Congress relied on these former merchants and fishermen to disrupt British trade routes and to smuggle British goods that the Continental Army needed. It is estimated that throughout the American Revolution, 800 vessels were commissioned as privateers and they captured or destroyed nearly 600 British ships.

Impact of US-French Alliance

Commerce had connected the colonists to the French before the start of the Revolution. Despite their best efforts, by 1776 the Americans found themselves desperate for aid. While they experienced some victories in battle, their losses were often greater than those of the British. Furthermore, despite the success of their privateers, British ships also disrupted and destroyed American vessels attempting to cross the Atlantic or travel between colonies.

In 1776, the Secret Commission of Trade established by the Continental Congress underwent a series of efforts to meet with the French government and convince them to provide substantial military and financial aid. By the end of the year, France hesitantly agreed to provide some of the aid Congress had requested but only in secret.

It was only after the American victory at the Battle of Saratoga in 1778 where the Treaty of Alliance and the Treaty of Amity & Commerce would be signed between the United States and France. These treaties would provide the Continental Army with ammunition, uniforms, and naval support, and clearly stated that neither France nor the United States could put duties on exports between the countries. This free trade clause would secure a new market and commercial ally for the newly independent United States.

Currency

Prior to the Revolution, currency was issued differently within each colony. The currency was organized by pounds (£), shillings (s), and pence (d). However the value of each varied from colony to colony. Since Britain did not mint coins in the colonies, the colonists relied on paper money.

In some instances tobacco notes also acted as forms of currency in Maryland and Virginia. Coins from the neighboring Spanish and French also found their way into the hands of colonists. Given the large variety of currency in the colonies, newspapers would print the fluctuating rates and merchants would account for multiple currencies as payment. Due to the lack of centralization, counterfeit money was also common. In 1757, printers Benjamin Franklin and David Hall developed unique prints on the Pennsylvania currency as a solution.

Currency during the revolution

After severing ties with the monarchy, the newly independent states printed their own currencies based on the similar system of pounds, allowing them to fund their local own militias. Local governments also borrowed money from private citizens and issued interest-bearing receipts in exchange. In an effort to centralize the nascent nation’s currency, the Continental Congress authorized the printing of “Continental Dollars” which would be based on the value of the familiar Spanish dollar.

These notes would include imagery and phrases that resonated with the values of the independence movement. For example in the 1775 bill below the Latin phrase “tribulatio ditat” translates to “trouble makes us stronger.” Similarly the bill next to it includes “post nubila phoebus” which translates to “after the clouds, the sun.” Unfortunately, due to overprinting, the value of the Continental Dollar would plummet throughout the war and by the end the notes would exceed the government’s silver and gold reserves. As a result, foreign currencies continued to be used both during and after the Revolution.

Module by Maria Reyes Pacheco, with contributions from Sophia Suh. Click here for bibliography.