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National Duties: Custom Houses and the Making of the American State

Author(s):Rao, Gautham
Reviewer(s):Brown, Kate Elizabeth

Published by EH.Net (October 2018)

Gautham Rao, National Duties: Custom Houses and the Making of the American State. Chicago: University of Chicago Press, 2016. xiii + 273 pp. $45 (hardcover), ISBN: 978-0-226-36707-1.

Reviewed for EH.Net by Kate Elizabeth Brown, Department of History, Western Kentucky University.

 

 

Historians have long called attention to the fact that the American marketplace, and the capitalists doing business in it, rely on the power of the state. For example, Sven Beckert’s recent tome, Empire of Cotton, makes this case for the U.S. as well as across the globe, while William Novak’s The People’s Welfare: Law and Regulation in Nineteenth-Century America highlights the many regulatory interventions made by the federal and state governments in nineteenth century America. The marketplace and the state have never existed in separate spheres from each other; instead, they are mutually dependent. This interconnectedness is at the heart of National Duties: Custom Houses and the Making of the American State by Gautham Rao, who further demonstrates how law, commerce, and state-building went hand-in-hand in the early American republic.

Rao, an associate professor of history at American University, focuses on the revolutionary and early republic eras to explore how merchants and shippers helped to “define the boundaries of the state” during the United States’ decades-long transition from imperial colonies to established republic (p. 10). The key to building and sustaining a thriving American republic, Rao tells us, lay in the customs house. For the young, indebted republic to survive — let alone to become the fiscal-military state the founders envisioned — the U.S. would have to understand the “negotiated authority between officeholders and merchants that had helped cohere the British Empire [and] would help sustain the early federal government on its maritime frontier” (p. 12)

This negotiated authority was a discretionary authority, and Rao’s excellent narrative describes how political crises of the era oftentimes were precipitated by a disintegration of negotiations between merchants and customs officers. When, for example, the British Parliament decided to raise revenue in the wake of the Seven Years’ War, the ensuing crack-down on smuggling as well as collecting customs revenue helped precipitate imperial crisis and ultimately, American independence from the bonds of British empire. The next crisis — what to do now that the United States won its independence — raised the question of whether or not American statesmen had learned anything from the 1760s and 1770s. Atlantic-world trade remained the most important way for individual states as well as the United States to raise revenue; but could the new secretary of the treasury, Alexander Hamilton, raise enough revenue to stave off national bankruptcy without alienating merchants (as the British failed to do)?

As usual, Hamilton proved up to the task. But the real heroes of Rao’s story are the many collectors of customs, naval officers, surveyors, and inspectors who ultimately reported to the secretary of the treasury, but were on the front-lines of negotiations with local merchants. These customs officials realized the need for discretionary authority when dealing with importers, and thus they did the real work of negotiating when to assert the power of the state, and when to let merchants do as they wished. Note, however, that this negotiated authority was not corruption; most of the discretionary authority wielded by customs officials arose from the fuzziness of statutory law. This allowed collectors to plausibly interpret the law in ways that benefited merchants, allowing them more time before paying back duty bonds, for example. Statutory vagaries and customary practice even prompted customs officials to allow smuggling during the embargoes put into place by the Washington and Jefferson administrations.

Rao’s exploration of the power of the maritime frontier is particularly good when he explores the nitty-gritty of the customs house, including the myriad duties of personnel stationed at the waterfront or the many ways in which Congress’s poorly constructed laws created the necessary gray areas for negotiated authority. The Federalists in charge of the customs houses in the 1790s were good at turning imprecise statutory language and loopholes into opportunities to please importing merchants, all the while collecting revenue for the U.S. Treasury. But revenue collection was not the only benefit for the young republic. As Rao explains, “The cozy relationship between customs houses and commerce did much to legitimize the new federal government” because the collectors’ “careful manipulation of the laws” illustrated how the government gained authority over and credibility with local merchants, and by extension, the local community (p. 88).

Federalists successfully negotiated the first implementation of revenue laws. But after the uncertainties of transatlantic trade under Washington’s neutrality policy as well as the heightened tensions of the Quasi-War with France, Republican customs officials had their turn to negotiate with local merchants. They, too, understood the benefits of negotiated authority at the waterfront — even if it meant defying policies set by the Jefferson administration — and remained exercising it until revenue-related scandals, new administrative oversight, and Jacksonian patronage ultimately ended the customs officers’ authority to interpret the law with discretion.

Rao is an excellent legal historian and National Duties reflects this through the compelling case it makes for state building at the waterfront in the early American republic. Still, Rao occasionally cannot fully account for the successes of this negotiated authority — for example, why importing merchants were more willing to pay into the U.S. treasury than the British treasury. But this never diminishes the strength of his argument, or his account of a young republic gaining legitimacy through difficult geo-political circumstances. He excels when he describes legal forces at work — particularly when he takes us into the courtroom, something I wish he would have done more of at the outset of the book. The only substantive oversight in his story might be Rao’s lack of attention to the other government agents influencing the waterfront: the district attorneys and district court judges who, along with customs officials, helped to hold importers accountable to the law. Also there are some copy editing issues that proved distracting. Nevertheless, National Duties is a well-researched, well-written account of statebuilding, law, and commerce in the formative years of the young American republic.

 
Kate Elizabeth Brown is an assistant professor of history at Western Kentucky University. The University Press of Kansas recently published her first book Alexander Hamilton and the Development of American Law.

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Subject(s):Government, Law and Regulation, Public Finance
International and Domestic Trade and Relations
Geographic Area(s):North America
Time Period(s):18th Century
19th Century