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Is There a Social History of Indian Liberalism?

By Anirban Karak

Histories of liberal thought in India begin, almost invariably, in the early nineteenth century with Rammohan Roy (1772-1833) and James Silk Buckingham (1786-1855). Both men were vocal supporters of social and political reform in colonial India and Britain alike, and are considered pioneers of the Indian press. As self-identified liberals, Roy, Buckingham, and their followers were part of a common front against the reactionary regimes of the post-Napoleonic period and bound together by networks of direct communication. They advocated for a dismantling of the East India Company’s monopolistic privileges in the name of free trade, and criticized restrictions on vernacular newspapers and racial prejudice in the appointment of company officials. For liberals of this generation, colonial institutional reform was just one front in a larger battle between the forces of reaction and the forces of progress, whether in Bolivia, France, or Britain. They indeed formed a new public, infused by the republican spirit of the American and French revolutions, and worked tirelessly to open up a space of commercial participation and mutuality between Indians and Europeans.

To a large extent, then, the conventional periodization of Indian liberalism is almost self-evident. The early nineteenth century was clearly the moment when a self-conscious and articulate anti-absolutist public sphere first emerged in India. It is not enough, however, to point out the distinctiveness of that specific moment. Without an analysis of the social roots of Indian liberalism, it is difficult to sort out the true legacy of the early liberals, a problem that has been compounded by the stranglehold of nationalist frameworks on historical imagination. One particularly unsalutary effect of this “territorial nativism” on historical memory, to borrow a phrase from Manu Goswami, has been the increasing hostility with which the internationalist ethos of the early liberals, and especially their “collaboration” with Europeans, has been treated. Although the first generation of nationalist historians – unable to deny the contributions of the early liberals to the creation of a democratic culture in India – were defensive on the issue of “collaboration,” the tide has turned quite definitively since the 1970s. Beginning in that decade, historians launched a critique of the early liberals, accusing them of being naive visionaries at best and willing conspirators at worst. Despite some notable and important exceptions to the general trend in Andrew Sartori’s and C.A. Bayly’s scholarship, Rammohan and others now stand accused, in most accounts, of having been privileged “elites” who failed to realize the complicity of liberalism with empire. The mirror image of these claims is that early nineteenth century “popular” culture had no liberal (read “European”) ideological content.

Raja Rammohan Roy, painting by Sibnath Sastri, 1907

But is it really true that liberal norms found no practical and social relevance in India? Can the political convictions of the early liberals really be dismissed as the ramblings of a few elites? A closer look at eighteenth-century Bengal, and especially at the neglected social history of demands from below for commercial liberties, suggests a very different story.  

Under Mughal rule, market taxes (called sair in official Persian) were an important component of state revenue in much of northern India including Bengal. In addition, the right of state could be evoked (usually by local administrators but sometimes by regional Nawabs or the emperor too) to justify blatantly arbitrary exactions. As Eugenia Vanina has put it, Mughal nobles and local chiefs who molested traders treated them “much like the knights in Sir Walter Scott’s Ivanhoe treated Isaac of York.” (215). Economic as well as cultural historians, however, have tended to underplay these conflicts within the social fabric of pre-colonial Bengal. This has allowed for a portrayal of both the East India Company (EIC) and Indian society as homogeneous entities, and hence for the propagation of straightforwardly nationalist readings of disputes between the company and the Nawabs of Bengal.

In an extremely influential 1998 study, for example, Sudipta Sen claimed that for Bengal’s merchants, “impositions on markets, market goers, and goods were accepted features of rural life.” (49-50) In other words, readers are asked to believe that despite heavy impositions on commerce, market culture in pre-colonial Bengal was largely consensual, and that exchange was “part of a larger moral economy of prestation that characterize(d) the relationship between rulers and subordinates.” (12) The judgment that follows from such claims is that liberal arguments for “free trade” in the late eighteenth and early-nineteenth centuries were nothing more than ideological justifications for empire.

Sen’s interpretation, however—which has made a lasting impression not only on economic and political historians of Bengal, but also on scholars of religion, including recent works by Hugh B. Urban, Bhaskar Mukhopadhyay, and Kaustubh Mani Sengupta—does not do justice to the complexity of social relations in eighteenth-century Bengal for at least three reasons. First, one ought to remember that the rapid growth of the city of Calcutta during the first half of the eighteenth century created the possibility for “collaboration” between British and Indian merchants, and for the emergence of a liberal politics of free trade in Bengal much before Rammohan Ray was even born. In the decades immediately preceding colonial rule in Bengal, artisans, merchants, and indigenous officials alike migrated in large numbers to Calcutta, often from places as far away as Dhaka and Murshidabad. The result was a gradual transformation of Calcutta into a commercial rather than an agricultural center. Between 1713 and 1747, for example, the proportion of market taxes to total revenue from the town increased from 13 to 37 per cent, even as total revenue itself increased by about 80 per cent, as Farhat Hasan has shown. The growth of Calcutta and of other factory towns with European presence meant that by the 1720s, the interests of British and Indian merchants were thoroughly enmeshed with regard to both foreign and inland trade. The sale of dastaks (passes that allowed duty-free trade)to non-Englishmen was a massive “business,” but one conducted strictly on the private account of the EIC’s servants. As early as 1720, the EIC’s gomastah (agent) Raghunandan was arrested for protecting the goods of other merchants from the payment of customs dues under the Company dastak. Indian merchants also sought refuge in Calcutta under the EIC to evade duties, and in 1755, a group of merchants claimed that they should be shielded from the Nawab’s demands for taxes while “under the protection of the Hon. English Flag.”[1]

A Calcutta Passage Boat, via British Library. Digitized image from “Narrative of a journey through the Upper Provinces of India from Calcutta to Bombay 1824-25. (With notes upon Ceylon.) An account of a journey to Madras and the Southern Provinces, 1826, and letters written in India” by Reginald Heber, 1783-1826. London.

Second, the Indian merchants to whom free trade and company protection mattered the most came from modest backgrounds. For great merchant and banking elites, such as the Armenian Khwaja Wazid and the Jagat Seths (an honorific title meaning “bankers to the world”), private trade was a major nuisance because it threatened to weaken their monopoly control over trade and currency. It was the smaller traders who lacked access to the Nawab’s court that stood to benefit the most from attaching themselves to the company. A large number of such traders, lacking monopoly farms and royal favour, dealt primarily in subsistence goods such as rice for the internal market of Bengal, acting as middlemen between rural production and local hats (periodic markets) and ganjs (market towns).

Finally, the belief that Mughal officials in Bengal were proud defenders of the law is untenable, for there is ample evidence that illegal tolls and taxes were very often no more than bribes demanded by revenue officials.[2] In short, not only was the “conflict” in the eighteenth century not a simple binary one between the EIC and the Mughal state, Sudipta Sen’s claim that refusals to pay duties (whether by the EIC or by Asians) constituted “a travesty of the rules of gift and exchange in the merchant-aristocratic society of contemporary northern India,” (62-63) is itself based on the implausible belief that all taxation was justified, whose evasion can therefore only be interpreted as a crime. On the contrary, the heavy-handedness of the pre-colonial state was, in fact, the first object of proto-liberal critique in Bengal.

This social interpretation of internal conflicts within Bengal’s emergent commercial society fits well with recent revisionist readings of the ideological roots of the Second British Empire.[3] Broadly, the revisionists have shown that both in 1757 and in the years immediately preceding 1765, a faction of free traders within the EIC along with their Indian counterparts tried to radically reorder political institutions in ways that would allow commercial enterprise to flourish. Especially in the early 1760s, the “maverick council” within the EIC managed to build a broad coalition made up of Indian, Arab, Chinese, and Armenian merchants and bankers; the Indian manufacturers whose products the company servants and their commercial allies sold in Indian and other Asian markets; and, most crucially, the Mughal emperor Shah Alam II in Delhi himself. To overcome the crisis of authority in Bengal, the maverick council sought to place the province under the direct authority of emperor Shah Alam II. Such a move would accomplish, the council believed, a second Glorious Revolution, laying the foundation for a new Mughal empire of liberty, a natural partner to a liberal British polity. In such an empire, both the Hanoverian and the Timurid “crowns” would represent a new revolutionary sovereignty, so that there could arise no question of divided allegiances.[4]

Portrait of John Johnstone of the “maverick council,” Betty Johnstone, and Miss Wedderburn. Artist: Sir Henry Raeburn (1756-1823)

During the years 1761-65, the maverick council and its allies tried valiantly to actualize their anti-monopolistic project. In the end, it was only the contingent defeat of liberalism in Britain, and the victory of a neo-Tory coalition in the 1764 EIC elections in London that turned the tide against them. This alliance between the monopoly interests within the company and the neo-Tories in Britain led by Robert Clive and George Grenville (also well-known for his imposition of stamp duties on the Atlantic colonies in 1765), had very different ideas about the future position of Bengal within the British empire. Instead of marching the EIC army to Delhi and proclaiming Shah Alam II as the emperor, the neo-Tories withdrew into Bengal in 1765, but not before they had acquired the diwani (the right to collect land revenue)for Bengal, Bihar, and Orissa. With an extractive and illiberal empire thus established, a systematic assault on all ties between Asian and British free traders was begun. At the same time, the revenue collected in Bengal was used to pay for the EIC’s own procurement of manufactures from the province. The hopes for a radically open-ended commercial society were thereby quashed, and Bengal ended up paying for its own exports.

In spite of a slew of illiberal reforms between 1765 and 1773, however, the impulses towards free trade did not die a meek death. In fact, people found innovative ways of making their demands heard. From the mid-1770s up to the Charter Act of 1813, conflicts over the establishment of “prejudicial” markets, complaints from weavers and merchants against excessive duties, as well as disputes between the EIC and Indian merchants were ubiquitous. Although the existence of such conflicts is acknowledged by social and economic historians —see, for example, the works by Rajat Datta and Tilottama Mukherjee—there is no comprehensive interpretation of their normative content and implications. I do not believe it is possible, as Sudipta Sen does, to reduce the multiple claims made by a variety of stakeholders during this period to a one-dimensional narrative about the imposition of “European” principles of “free trade” on an unwilling colony.

Nevertheless, based on my own preliminary research in the colonial archive, I can confidently insist on two points. First, that the claims and counter-claims made in many legal cases of the period indicate that the company-state had a hard time finding a balance between demands for commercial freedoms from below, the right of the state to revenue, and the privileges that persons of status in Bengal hoped to enjoy. The need for maintaining such a balance arose because expansive commercialization, which pre-dated British rule, had made it increasingly difficult to keep the market subordinate to prevailing structures of civic and political authority. Even more striking is the fact that sophisticated political-economic arguments, such as the distinction between rent and market taxes, were used by those opposing the barriers to entry created by the colonial state and local figures of authority. Although Indian free traders were unsuccessful in winning concessions more often than not, they were sometimes able to force the EIC to accept that no real justifications for its nepotism and extractive policies could be found. In other words, political-economic arguments were adopted and used in Bengal neither because they had been imposed from outside, nor because indigenous elites in the early nineteenth century mimicked their colonial rulers, but because people in Bengal found an object for political economy in their own commercial aspirations and in the barriers that such aspirations came up against.[5]

A social history of the conflictual rather than consensual market culture in eighteenth-century Bengal is thus possible and necessary, but yet to be fully written. If attempted, such a history shall allow for a better grasp of the social – and very often the ‘subaltern’ – origins of the articulate ‘elite’ liberalism that emerged in the early nineteenth century. To undertake such an attempt, however, historians need to move beyond well-entrenched nationalist myths about eighteenth-century Bengal, and to concede that demands for commercial liberties were expressive of deeply felt aspirations for a more liberal and just institutional order.


[1] British Library, IOR/P/1/28: Calcutta Public Proceedings (August 11 and 19, 1755), 297, 323-324, 409.

[2] Spencer Leonard, “A Fit of Absence of Mind? Illiberal Imperialism and the Founding of British India, 1757-1776.” PhD. Dissertation, University of Chicago, 2010, 137.

[3] Leonard, “A Fit of Absence of Mind?” and James M. Vaughn, The Politics of Empire at the Accession of George III: The East India Company and the Crisis and Transformation of Britain’s Imperial State (New Haven: Yale University Press, 2019).

[4] Leonard, “A Fit of Absence of Mind?” 18.

[5] The relevant EIC records include, but perhaps are not limited to, the “sayer” (anglicized version of sair) and “customs” proceedings of the Board of Revenue, the “commercial” proceedings of the Board of Trade, as well as the general proceedings of the Bengal Revenue Council and the Calcutta Committee of Revenue. These are housed partly in the British Library in London, and partly in the West Bengal State Archives in Kolkata.


Author Bio Anirban Karak is a doctoral student of South Asian history at New York University, where he is exploring the evolving relationship between commerce and ethical norms in eighteenth and early nineteenth-century Bengal. His overarching research interest lies in bridging the gap between traditional histories of capitalism as the history of European ascendancy, and specifically South Asian Histories. Anirban has published essays on the history of the English Premier League in the Review of Radical Political Economics, on the relationship between Indian Political Economy and state planning in Modern Asian Studies, and on the implications of revisionist Hegel scholarship for historiography in Mediations. He also has an article forthcoming in Critical Historical Studies on the possibility of a dialogue between heterodox economics and the new histories of capitalism. He can be reached at anirban.karak@gmail.com.

Featured Image: Featured Image: A Thoroughfare in Calcutta, c. 1846, via British Library. Digitized image from “The History of China & India, pictorial and descriptive [With plates and maps.]” by Julia Corner. London: 1846.

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The Emotional Life of Laissez-Faire: Emulation in Eighteenth-Century Economic Thought

By guest contributor Blake Smith

Capitalism is often understood by both critics and defenders as an economic system that gives self-interested individuals free reign to acquire, consume, and compete. There are debates about the extent to which self-interest can be ‘enlightened’ and socially beneficial, yet there seems to be a widespread consensus that under capitalism, the individual, egoist self is the basic unit of economic action. For many intellectuals from the right and the left capitalism seems, by letting such economic agents pursue their private interests, to erode traditional social structures and collective identities, in a process that is either a bracing, liberating movement towards freedom or an alienating, disorienting dissolution in which, as Marx famously phrased it, “all that is solid melts into air.”

Economic activity unfettered by government regulation was not always so obviously linked to the self-interest of atomized individuals. In fact, as historians inspired by the work of István Hont show, the first wave of laissez-faire political economists, who transformed eighteenth-century Europe and laid the foundation for modern capitalism, claimed that they were creating the conditions for a new era of mutual admiration and affective connections among economic agents. For these thinkers, members of the ‘Gournay Circle’, emotions, rather than mere self-interest, were the motor of economic activity. They specifically identified the kind of activity they wanted to promote with the feeling of ’emulation’, and touted the abolition of traditional protections on workers and consumers as a means of stoking this noble passion.

Emulation has only been recently been given center stage in the history of economic thought, thanks to scholars like John Shovlin, Carol Harrison and Sophus Reinert, but it has a long history. From Greco-Roman antiquity down through the Renaissance, it was understood as a force of benign mutual rivalry among people working in the same field. Emulation was said to set in motion a virtuous circle in which competitors, bound by mutual admiration and affection, pushed each other to ever-higher levels of achievement. When a sculptor, for example, sees a magnificent statue made by one of his fellow artists, he should experience an uplifting feeling of emulation that will inspire him to learn from his rival in order to make a still more magnificent statue of his own. Emulation thus leads to higher standards of production, generating a net gain for society as a whole; it also, critically, unites potential rivals in a bond of shared esteem rooted in a common identity. This form of friendly competition sustains communities.

Emulation was not for everyone, however. It was understood only to exist in the world of male elites, and only in non-economic domains where they could pursue glory without the taint of financial interest: the arts, politics, and war. The circle of young male artists in the orbit of the great painter Jacques-Louis David (1748-1825), as Thomas Crowe notes, could present their (not always harmonious) competition for attention, resources, and patronage in terms of emulation. In the homosocial space of the studio, anything so petty as jealous or avarice was abolished, and such artists as Antoine-Jean Gros, Anne-Louis Girodet and Jean-Germain Drouais could appear, at least in public, as a set of friends who admired and encouraged each other. Women, meanwhile, were largely excluded from the art world’s apprenticeships, studios, and galleries, on the grounds that their delicate psyches were not suited to the powerful emotions that drove emulation.

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Vincent de Gournay

The discourse of emulation shaped access to the arts, but, in a stroke of public relations genius, the members of the Gournay Circle realized that it could also reshape France’s mercantilist economy. Beginning in the 1750s, this group of would-be reformers coalesced around the commercial official and political economist Vincent de Gournay (1712-59). Largely forgotten today (but now increasingly visible thanks to scholars such as Felicia Gottmann), Gournay and his associates inspired the liberal political economists of the next generation, from Physiocrats in France to Adam Smith in Scotland. The Gournay Circle and those who moved in its wake called for the abolition of restrictions on foreign imports, price controls on grain, state monopolies, guilds—the institutions and practices around which economic life in Europe had been organized for centuries.

The Gournay Circle spoke to a France fearful of falling behind Great Britain, its rival for colonial and commercial power. Gournay and his associates argued that France was not making the most of its merchants, entrepreneurs and manufacturers, whose energies were hemmed in by antiquated regulations. To those worried that unleashing economic energies might heighten social tensions, making France weaker and more divided instead of stronger, the Gournay Circle gave reassurance. There was no conflict between fostering social harmony and deregulating the economy, because economic activity was not motivated by self-interested desires for personal gain. Rather, buying and selling, production and distribution were inspired by emulation, the same laudable hunger for the esteem of one’s peers that motivated painters, orators and warriors.

Just as a sculptor admires and strives to outdo the work of his colleagues, laissez-faire advocates argued, a merchant or manufacturer regards those in his own line of work with a spirit of high-minded, warm-hearted camaraderie. Potential competitors identify with each other, forging an emotional bond based on their shared effort to excel. Thus, for example, demolishing traditional guild controls on the number of individuals who could enter into a given field of trade would not only encourage competition, raise the quality of goods and reduce prices—most importantly, it would draw a greater number of people into emulation with each other. Social classes, too, would be drawn to emulate each other, and rather than stoking economic conflict among competing interests, deregulation would encourage economic actors to earn the admiration of their fellows. National wealth and national unity would both be promoted, joined by a common logic of affect.

Under the banner of emulation, reformers challenged the guilds and associations that had long offered some limited protections to workers. Since the Middle Ages, guilds throughout Europe had set standards of production, provided training for artisans, and offered forms of unemployment insurance. Critics observed that they also kept up wages by limiting the number of workers who could enter into specific trades, and further accused guilds of thwarting the introduction of new technologies. Anne Robert Jacques Turgot (1727-1781), a political economist linked to the Gournay Circle, believed that the best way to “incite emulation” among workers was “by the suppression of all the guilds.”

For a brief moment, Turgot (still hailed as a hero in libertarian circles) was able to put his pro-emulation agenda into action. Appointed Comptroller-General of Finances (the equivalent to a modern Minister of Finance) in 1774, Turgot launched a laissez-faire campaign that included the abolition of guilds and the suspension of state controls on the price and circulation of grain. The royal decree announcing his most infamous batch of policies, the Six Edits, declared: “we wish thus to nullify these arbitrary institutions… which cast away emulation.” Turgot’s policies provoked outrage across French society, from peasants who feared bread prices would spiral out of control, to guild members who faced the competition of unregulated production. He was forced to resign in 1776; his most hated policies were reversed. But the damage had been done. The guild system, permanently enfeebled, straggled on for another generation. Peasants and workers, to whom the fragility of the institutions that protected their access to food and labor had been made brutally obvious, remembered the lesson. Their outrage in the mid-1770s was a rehearsal for 1789.

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“Carte d’Entrée” for the first annual meeting of the Société d’Emulation

Emulation gradually faded away as a justification for liberal economic policies, although throughout much of the nineteenth century ’emulation clubs’ (sociétés d’émulation) remained a fixture of French municipal life, promoting business ventures while excluding groups whose capacity for emulation was considered questionable: women, Jews, and Protestants. As a key, albeit forgotten, concept in the development of modern economic thought, emulation reveals the extent to which the notion of the self-interested individual as the essential subject of economic activity is not in fact essential to capitalist ideology. In eighteenth-century France, laissez-faire policies aimed at increasing economic growth were justified in terms of their contribution to social harmony and emotional fulfillment. In the rhetoric that promoted these policies, the imagined economic subject was not an isolated, calculating egoist but a passionate striver who wanted, more than mere utility, welfare or profit, the admiration of other members of his community (that this community should exclude certain groups of people went without saying). Such arguments may well have been deployed by cynical activists agitating on behalf of powerful financial interests, yet they nevertheless speak to an affective dimension of economic life that is too often occluded. In its short-lived role as an economic concept, emulation showed that the history of capitalism is necessarily entangled with the history of emotions.

Blake Smith holds a PhD from Northwestern University and the Ecole des Hautes Etudes en Sciences Sociales. He is currently a Max Weber Fellow at the European University Institute, where he is preparing a study of the eighteenth-century French Orientalist Abraham Hyacinthe Anquetil-Duperron.