The British Financial Crisis And New York Colony

In the period of absolutism, France and Britain had been fought at sea and on battlefields in Europe, America, and Asia. The struggle had lasted half a century. The major conflict between two nations resulted from the interests of power balance and commercial gain. The end of the Seven Years� War in Europe and the French and Indian War in North America ( 1756-1763 ) resulted in the final victory of Britain. The victory made Britain the most powerful European nation. However, the Great War for Empire had two important consequences which brought on a crisis. In the first place, it left Britain with " a national debt which for that day amounted to the enormous sum of $700,000,000." ( Graves, 11 ) In the second place, Britain planned to tax the American colonies in order to relieve the heavy burden at mother country.

When George Grenville became King GeorgeV�s chief minister in 1763, he appeared to face a much easier task than William Pitt had confronted six years earlier. ( Berkin, 68 ) Grenville soon discovered the costs of glory. Pitt had spent vast sums, and had left the new minister with an enormous war debt. ( Berkin, 68 ) Besides the war debt, Britain also needed the funds for the troops and ships which would have to remain on station to safeguard. Meanwhile, British taxpayers, who had suffered from the wartime burden, were expecting tax relief, not tax increase. In Grenville�s view the North American colonies had delayed paying long enough. ( Countryman, 41 ) Therefore, he planned to tax them at least the cost of their own administration and defense. He proposed some steps in order to achieve this goal.

First, Grenville pointed out that Americans traded for illegal goods with Britain�s rivals and avoided paying import duties. To end American smuggling, he strengthened custom�s power to search ships and warehouses for smuggled goods, and took customs officers from taking bribes from smuggling. Next, Grenville reformed the import regulations with Revenue Act or so-called, Sugar Act in 1764. The act made duty cheaper to pay the import duties on foreign molasses and sugar than it was to bribe customs officials or to avoid the duty by smuggling. Thus, the duty on foreign molasses was reduced from six to three pence per gallon. His purpose was to raise revenue collected at colonial ports. Finally, he planned to tax colonies directly with Stamp Act. The act of 1765 required one to buy the appropriate stamp from an official distributor before he or she could possess an object or carry out an action listed in the act. All documents bearing on court cases, or on church matters, or on admission to public office would have to be stamped. ( Countryman, 47 )

Conversely, a range of such acts didn�t please New York residents; New Yorker greeted the Grenville�s proposals with outrage, hostility, and anger. At first, the shippers, traders, dock-workers, and wholesalers were affected directly by the Sugar Act because New York was functioning as an important trading port. Moreover, other merchants, shopkeepers, and skilled workers started to raise their voices, too. When the Stamp Act reached New York in 1765, the wave of protests also spread into the large part of citizens consisted of day laborers, tenant farmers, and semi-skilled workers, who had not had much wealth - they were ready to join any movement that promised to improve their financial, social, and political rights. They blamed this situation on Grenville�s proposal, saying that British financial problem with their army and navy is not colonists�; it�s British�s, and they got angry about being taxed without their consent, which meant " taxation without representation."

Though news of the Stamp Act sent a wave of anger over the colonies from New Hampshire to Georgia, " nowhere was opposition more active or determined than in New York," Lieutenant Governor Coldon reported. ( Graves, 14 ) Graves described a range of New Yorkers� response against the Stamp Act as follows;

The New York stamp collector, James McEvers, a merchant, resigned his office out of fear of personal injury. The newspapers were also filled with hostile articles, urging the people to refuse to purchase the stamped papers. When the stamps and stamped paper arrived at New York City, rioters threatened to destroy the ship and cargo ..... The stamped papers were removed to a warship ..... lodged in the fort for safety .... a second consignment of stamped paper was likewise stored away and not sold. .... a committee was appointed to induce people to carry on business as usual without stamped papers. ( Graves, 15 )

This was the beginning of resistance in New York. Historically, the Stamp Act left a significant consequence that New Yorkers started to consider the rights as the colonists and relationship with the mother country by focusing on it. As a result, the merchants of New York agreed not to import English goods; the political leaders of New York created committees to oppose this situation.

On the whole, the British financial crisis created by the time-long Great War, affected directly and indirectly to the New York citizens. The import regulations and taxation to the colonies made New Yorkers have a strong hostility; they took a position not to accept taxation without representation. A range of such acts produced the first of series of resistance against the mother country which a decade later resulted in the Declaration of Independence.



Berkin, Carol. Miller, L. Christopher. Cherny, W. Robert. Gormly, L. James. Mainwaring, W. Thomal. Making America; A History of the United States, Vol A. Boston; Houghton Mifflin Company, 1997.

Countryman, Edward. The American Revolution. New York; Hill and Wang, 1985.

Graves, P. Frank. The American Revolution in New York. Albany; the University of the State of New York, 1926.


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