Published by EH.NET (April 2001)

Richard Buel, Jr., In Irons: Britain’s Naval Supremacy and the American Revolutionary Economy. New Haven: Yale University Press, 1998. xiv + 386 pp. $35 (cloth), ISBN: 0-300-07388-7.

Reviewed for EH.NET by James F. Shepherd, Department of Economics, Whitman College.

A sailing ship that becomes stalled with its bow to the wind is said to be “in irons.” Richard Buel Jr. uses this apt metaphor to describe the inability of the American economy to free itself from the constraints imposed upon it by British naval supremacy during the Revolutionary War. This naval supremacy affected not only trade, but also production, especially in the dominant agricultural sector, and thus the ability of Americans to support and finance the war for independence. The book’s organization is chronological and much emphasis is given to discussing the links between trade, production, and revolutionary finance necessary to carry on the war. His geographic focus is upon the mid-Atlantic region and southern New England, though Boston and the Chesapeake receive some attention. Less attention is given to the Lower South. Sources include published and archival correspondence and records, and many secondary sources. He concludes that increased agricultural production in 1781 helped Americans win the war (along with British ineptitude), but economic independence as envisioned by men like Robert Morris was more difficult to attain than political independence, and was not really evident until later during the War of 1812, by which time a truly national economy had emerged.

At the beginning of the Revolution, the British North American colonies produced a sizable agricultural surplus. Buel suggests, for example, that 22.7 percent of all grains were exported in 1775. At this time, all thirteen colonies were self-sufficient in the production of foodstuffs and most of the necessities of life, with the possible exception of parts of New England, which imported some wheat and flour. During the Revolution some of these surpluses declined, and overall harvests generally fell in the period from 1778 to 1780. This was true in all the major grain-producing regions, including New York, Pennsylvania, and the Chesapeake. Apparently, a number of factors played a role. The Hessian fly spread from Long Island in 1777, and a more widespread impact began to be felt in 1778. Afterward, other reasons existed, too. There was a shift from wheat to corn in Virginia in an effort to be more self-sufficient. Due to the war, agricultural surpluses from frontier areas were sometimes more costly and difficult to ship. Lucrative alternative markets in the West Indies attracted surpluses of rice from the Lower South that might have provided supplies to the army in the north. Rice production also was hampered by British disruption of the slave economy and by the completion of the conquest of Georgia and South Carolina in 1780. Shipping of rice to the north was hindered by privateering in shipping routes to those destinations. Also, in 1778 and following years, French agents competed with Americans for the surpluses, often outbidding them with better access to bills and specie that served as preferred means of payment.

A number of other factors caused decreasing surpluses. However, Buel believes that arguments about the diversion of agricultural labor into the army and soil exhaustion fail to explain the reduction of agricultural surpluses. He maintains that reduced trade, at least partly due to the Royal Navy’s blockade of the coast, plus misguided monetary and financial policies of the states and the Continental Congress, led to decreased production and thus lowered surpluses. The Royal Navy threatened American shipping and reduced trade first in New England, and then in all major American ports at one time or another after March 1776. Access to foreign shipping did not reduce the impact of the blockade. Buel spends a good deal of time examining the links between trade and monetary and financial policies. Reduced imports led to decreased demand to hold currency. In addition, increased amounts of state and national currency had been issued to pay for the war because the states were reluctant to increase taxes, leading to increased expectations of inflation. All these factors led to increased rates of depreciation of the currency, and reduced incentives to produce for the market.

Attempts by the Americans and French to replace imports of British goods with French were not entirely successful. French goods tended to be higher priced and of lower quality, and credit was less available. The French lacked a marketing network like the Scottish stores in the Piedmont, and different languages and cultures complicated trade. The preferred return cargo, tobacco, was high priced due to reduced production. Shipping in the Chesapeake was a problem due to the ease of blockading, and declining currency values complicated these problems. These factors, together with the increased costs of trade due to the British blockade meant the French failed to replace the British in trade with the American states; and these reasons explain why much of the trade in textiles and other manufactured goods reverted back to Britain after the War.

Buel discusses many of the specific reasons for the increased costs of trade and shipping. American governments, both the states and Congress, tried to contend with Britain’s naval power by building deep-water navies, and galleys to protect harbors and coastal areas. There were some successes, especially in 1779, but problems increased after that time. There were difficulties in raising manpower and financing the building of such naval vessels. Americans had other disadvantages, such as the lack of copper-bottom ships, inferior armaments, and a shortage of naval stores. The response of American merchants to the high risks of shipping contributed to higher costs. They spread risk by reducing shares in any particular ship or venture, and dividing goods among different vessels; by using smaller vessels; by arming vessels, which sacrificed cargo space and required additional crew; and by building “sharp” vessels for speed rather than “clunks” for transport efficiency.

The ability of the British to seize American ports was even more devastating than the higher costs of shipping and trade caused by the blockade. Disruption of the existing commercial network destroyed the efficiencies this network had brought. These included the more prominent roles played by more distant ports like Boston and St. Eustatius (because of the occupied and/or blockaded mid-Atlantic ports of New York and Philadelphia) and the increased use of land transport. Inflation of the continental currency, and the attempted regulation of prices and wages of seamen, affected trade and agricultural production negatively. Loyalist privateering reinforced the effectiveness of Britain’s sea borne efforts to throttle the American economy.

For all these reasons, the time from the autumn of 1778 to the spring of 1780 was the low point of the War for the Americans. Rochambeau’s expedition brought the infusion of French money and stimulation to the New England economy in the summer of 1780, though French purchase sometimes reduced the surpluses available to the American army. A revival of agricultural production in the Delaware and Chesapeake regions followed from increased plantings in the fall of 1780. Factors, in this revival may have been the hope of increased demand from Cuba and other Caribbean areas, together with elections in Pennsylvania that gave greater voice to political policies which favored market solutions (and higher prices). A consequence was resurgence in Philadelphia’s trade in 1781 when tonnage entering that port increased to 42 percent of its prewar level. It also led to increased supplies in 1781 for the army, a necessary condition for victory at Yorktown. This was fortunate because the British blockade put increased pressure on the American economy in 1782. Although it failed to cripple the mid-Atlantic region’s trade, it reduced the central position Philadelphia held in it. However, by that time, the British were tiring of the war. The Americans had outlasted British naval supremacy.

Buel goes on to discuss monetary and financial problems that were to plague the U.S. under the Articles of Confederation through the 1780s. Only slowly would a truly national economy and economic independence emerge as peace allowed recovery and a search for political solutions. In all, this is an excellent book that offers new evidence about the American revolutionary economy.

James F. Shepherd is professor of economics at Whitman College, Walla Walla, Washington. His books include Shipping, Maritime Trade, and the Economic Development of Colonial North America (Cambridge University Press, 1972), and The Economic Rise of Early America (Cambridge University Press, 1979) — both with Gary M. Walton. His current research concerns the agricultural history of the Columbia Plateau in the Pacific Northwest.