Day of Empire_ How Hyperpowers Rise to Global Dominance--And Why They Fall - Amy Chua [108]
EMPIRE BUILDERS FROM THE “SINK OF THE EARTH”
William Paterson was a “fast-talking Scot” born in a farmhouse in Dumfriesshire around 1658.12 As a young man, he made a fortune traveling in the Americas and the West Indies—doing what it is not entirely clear. He has been variously described as a churchman, businessman, and buccaneer, and he was probably all of these things. He was also a financial visionary. In 1694, during a stint in London, Paterson developed the original proposal for the Bank of England and became, along with a number of London merchants, one of its founding directors. But whereas the bank, his brainchild, went on to become the linchpin of Britain's global ascendance, Paterson fell out with his fellow directors and eventually returned to Edinburgh.
At the time, Scotland's economy was traditional and largely rural. England's economy, by contrast, was booming through trade with its colonies and outposts all over the world and through injections of capital and entrepreneurialism supplied by new institutions like the Bank of England and the East India Company. Having founded the former, Paterson threw himself into outdoing the latter. In 1695 Paterson conceived the Darien scheme, which led to one of the most tragic chapters in Scottish history.
Paterson persuaded the Scottish parliament to establish a Scottish colony in Panama, on the isthmus of Darien. The new colony would serve as a trading center linking the Atlantic and Pacific oceans. Instead of having to sail all the way around the southern tip of South America, ships from Europe would simply unload their goods in Darien. The goods would then be transported to the other side of the narrow isthmus and reloaded onto different ships bound for Asia. As the middleman, the Scots would naturally charge a hefty commission on both sides. At the same time, Scotland would control “this door of the seas, and the key of the Universe.”
The Darien scheme seemed so promising that it originally attracted investors not only from Scotland but from England and Holland as well. However, the English parliament, strongly lobbied by the East India Company, threatened legal action, even charging Paterson and his co-venturers with high misdemeanors, causing English and Dutch subscribers to withdraw. In response, thousands of outraged, patriotic Scots, high and low, rushed in to make up the shortfall. Aristocrats mortgaged their estates while commoners turned over their meager savings. In just two months, Paterson's company raised the entire amount needed to finance the venture—£400,000, nearly half the total money then circulating in Scotland. On July 18, 1698, five Scottish ships set sail for the New World, with Paterson and his family among the 1,200 passengers.
It would be hard to imagine a more disastrous outcome. The romantic Paterson had described Panama—although he had never been there—as a land of milk and honey, inhabited by friendly natives eager to trade. As a result, the colonists were utterly unprepared for what they found: a malarial morass, torrential rains, and soil in which their seeds would not grow. Instead of sufficient food, they had brought five thousand bibles, four thousand powdered wigs, and, for trading purposes, thousands more mirrors and combs (in which the Indians proved totally uninterested). Soon the settlers were down to a pound of moldy flour a week: “When boiled with a little water, without anything else,” one wrote home, “big maggots and worms must be skimmed off the top.” The same settler later reported: “Yet for all this short allowance we were every man…daily turned out to work by daylight, whether with the hatchet, wheelbarrow, pick-axe, shovel, fore-hammer…My shoulders have been so wore with carrying burdens that the skin has come off them and grew full of boils…Our bodies pined away and grew so macerated with such allowance that we were like so many skeletons.”
Fever set in, along with alcoholism. The death rate rose to more than ten a day. The final blow was that the English refused to trade with the starving