The Heritage of Slavery and Colonialism

Introduction

Europe and the United States achieved global dominance through slavery and colonialism, which significantly contributed to their wealth.
The current global distribution of wealth is still influenced by this historical legacy, making it crucial to examine these episodes.
Western industrial capitalism is closely tied to the international division of labor, exploitation of natural resources, and military/colonial domination from the 15th to 19th centuries.
A history of equality and inequality at the global level requires assessing the importance of this colonial heritage.
European expansion started around 1450-1500 and ended in the 1960s, or even the 1990s with the end of South African apartheid.
The effects of colonialism cannot be erased quickly, and it is our responsibility to consider this heritage in analyzing the world economic system.

The “Great Divergence” and Ecological Constraints

Ken Pomeranz's work highlights that Western industrial development relied on planetary-scale resource and labor mobilization.
Without this system, industrial development would have faced ecological constraints.
The Industrial Revolution in the UK, starting in the late 18th century, was fueled by raw material extraction (especially cotton) and energy sources (wood) from the rest of the world under a coercive colonial system.

Comparing Development in Europe and Asia

Around 1750-1800, the most advanced regions of China and Japan had comparable development to Western Europe.
Similar socioeconomic structures were based on demographic and agricultural growth (improved farming, deforestation) and proto-industrialization with capital accumulation in textiles.

Diverging Trajectories

Two key elements led to diverging trajectories from the second half of the 18th century:
- European deforestation and the availability of coal deposits, especially in England, led to the use of alternative energy sources and related technologies.
- The fiscal and military abilities of European states allowed them to organize a profitable international division of labor and supply.

Deforestation in Europe

By the end of the 18th century, Europe had depleted its forests.
Forests decreased from 30-40% of the surface area around 1500 to just over 10% in 1800 (16% in France, 4% in Denmark).
Trading wood from eastern and northern Europe initially compensated for losses, but this became insufficient.
China also saw deforestation between 1500 and 1800, but it was less marked due to political and commercial integration with wooded regions.

Overcoming Constraints through Colonialism

Europe overcame constraints through the “discovery” of America, triangular trade with Africa, and exchanges with Asia.
Exploitation of land in the Americas, using African labor, produced raw materials (wood, cotton, sugar) for colonists and textile factories.
Military control of sea lanes facilitated large-scale complementarities.

Interconnected Trade

Food for slaves in the West Indies and the southern United States was financed by British textile exports to North America, which were made possible by wood and cotton from plantations.
In the 18th century, one-third of textiles used to clothe slaves came from India, paid for by money from America.

Dependence on Colonies

Around 1830, England's imports of wood, cotton, and sugar from plantations corresponded to the exploitation of over 10 million hectares of arable land, 1.5 to 2 times the total arable land in the United Kingdom.
Without colonies, Europe would have needed to find these resources elsewhere.

Alternative Scenarios

It's possible to imagine scenarios where an autarkic Europe achieved the same industrial prosperity, but this would be a completely different story.

Energy Transition

Historically, energy transitions involve an increase in energy sources rather than substitution.
Around 1900, France imported the equivalent of half of its national wood production, and the United Kingdom burned more than two years' worth of French production.

European Military Domination

European military success in the 18th and 19th centuries had little to do with Adam Smith’s recommendations in The Wealth of Nations (1776).
Smith advocated for low taxes, balanced budgets, respect for property rights, and unified, competitive markets.
China's institutions in the 18th century were more in line with Smith's ideas than those of the United Kingdom.

Taxation and Public Debt

Taxes were much lower in China and the Ottoman Empire.
The Qing dynasty practiced strict budget orthodoxy, while European states were frequently at war and accumulated substantial public debts.
This fiscal, financial, and military capacity proved decisive for the rise of Europe’s power.

Military Strength

In the 16th century, Chinese and Ottoman states were militarily comparable to European states.
By the late 18th century, European states had developed absolute military domination due to competition among themselves.
Around 1550, the Ottoman infantry and navy consisted of 140,000 men, similar to French and English forces combined.
By 1780, Ottoman forces had hardly changed (150,000 men), while French and British forces reached 450,000 men, with superior naval fleet and firepower.
Austria had 250,000 men and Prussia 180,000 men, whereas these states were militarily nonexistent in 1550.

Divergence in Tax Receipts

Tax receipts confirm a major divergence between European and non-European states between 1500 and 1800.
Before 1600-1650, receipts were low everywhere.
By 1700-1750, European states consolidated and showed a clear divergence.
At the end of the 18th century, Chinese and Ottoman tax receipts were 2-4 days' salary per inhabitant (1-2% of national income), while in European states they were 15-20 days' salary (6-8% of national income).
A state levying 1% of national income has limited power, whereas a state with 6-8% has greater abilities for maintaining order and military reach.

The Cotton Empire

Recent research confirms the central role of military and colonial domination in the “great divergence”.
Political fragmentation in Europe allowed states to gain the upper hand over China between 1750 and 1900, due to innovations arising from military rivalries.
Sven Beckert’s research highlights the crucial role of slave labor in cotton extraction as British and Europeans controlled worldwide textile production between 1750 and 1860.
The West Indies and Saint-Domingue were primary cotton producers until about 1780-1790. After the slave revolt in 1791, the US South increased slave acquisition and cotton production.
The ban on the black slave trade took effect in 1808, but clandestine trading continued.
Between 1800 and 1860, the number of slaves in the American South grew fourfold, from one to four million.
Cotton production increased tenfold due to improved techniques.
On the eve of the Civil War, 75% of cotton imported to European textile factories came from the southern United States.

Protectionist Policies and the Textile Industry

Prasannan Parthasarathi's work emphasizes the key role of anti-Indian protectionist policies in the emergence of the British textile industry.
In the 17th and 18th centuries, China and India were the main exporters of manufactured products, financed by imports of silver and gold from Europe and America.
Indian textiles, especially printed fabrics and blue calicos, were very popular.
At the beginning of the 18th century, 80% of textiles traded by British merchants for slaves in West Africa were made in India, dropping to 60% by the end of the century.
In the 1770s, Indian textiles represented one-third of the cargos loaded in Rouen for the slave trade.
Indian textile exports to the Middle East were larger than those to West Africa.

Protectionism and Trade Policies

In Europe, merchants encouraged protests against Indian textiles and sought to appropriate their know-how.
In 1685, the British Parliament introduced tariffs of 20%, raised them to 30% in 1690, and banned the importation of printed or colored textiles in 1700.
Only undyed fabric was imported from India, allowing British producers to innovate.
Similar measures were adopted in France and strengthened in the UK, including a 100% duty on all Indian textiles in 1787.
After acquiring a comparative advantage in textiles, the United Kingdom adopted a free-trade discourse in the mid-19th century.
The British also used protectionist measures in the naval industry, imposing a 15% tax on goods imported on ships made in India in 1715 and decreeing that only British vessels could import merchandise from east of the Cape of Good Hope.

Impact of Protectionism

These protectionist measures played a significant role in British and European industrial domination.
China’s and India’s share in worldwide manufacturing fell from 53% in 1800 to 5% in 1900.

Protectionism and Economic Development

Protectionism played a central role in almost all successful economic development experiments.
Japan, South Korea, Taiwan, and China practiced targeted protectionism to develop specialties in priority sectors.
These countries limited foreign investor control and only adopted free-trade discourse after establishing supremacy.
Wallerstein’s research on world-systems and center-periphery relations illustrates this reality in the long-term history of capitalism.

The Role of Military Force

The unique aspect of Europe’s rise was the immoderate use of military force at the global level.
European commercial companies, like the British East India Company, were enterprises of transnational militarized robbery.

The Opium Wars

Europeans, running out of silver, intensified opium-growing efforts in India to export to China.
In 1773, the British East India Company established a monopoly over opium production and exportation from Bengal.
The Qing Empire tried to enforce its ban on opium consumption.
In 1839, the emperor ordered the traffic stopped and opium burned, leading to a violent anti-Chinese press campaign in the United Kingdom.

The First Opium War

The Qing emperor underestimated the United Kingdom’s power, and the First Opium War (1839-1842) resulted in a Chinese defeat.
The British bombarded Canton and Shanghai, obtaining the first of the “unequal treaties” in 1842.
China paid financial compensation, granted privileges to British merchants, and ceded Hong Kong.

The Second Opium War

The Qing government still refused to legalize the opium trade.
The Second Opium War (1856-1860) led to the sack of the Summer Palace by French and British troops in Beijing in 1860.
In 1860-1862, the Chinese state granted Europeans trading posts, territorial concessions, and war reparations.
China had to allow Christian missionaries to roam freely.

Debt and Coercion

The Chinese state had to abandon its budgetary orthodoxy and resort to public debt.
This debt snowballed, forcing the Qing Empire to raise taxes and cede fiscal sovereignty, following a colonial scenario of coercion through debt.

Financial Innovation and Colonialism

Internal public debt was contracted by European states to finance wars and played a role in securitization and financial innovation.
Experiments with joint-stock companies were based on commercial or fiscal monopolies of the colonial type.
Europeans established infrastructures and comparative advantages through financial and commercial techniques.

Provincializing Europe

Colonialism and military domination allowed Western countries to organize the world-economy to their benefit.
Japan experimented with this strategy in Asia during the first half of the 20th century.
China, having escaped colonial control, developed its own strategy in the early 1980s and has made other economies dependent on it.
Europe was the first to extend this strategy globally, supported by military domination and the absence of opposition.

Explaining European Fiscal and Military Superiority

The reasons for European fiscal and military superiority are often explained by interstate competition and European territorial structures between 1500 and 1800.
Some argue that capitalist social relations developed in the English countryside long before colonial expansion.
The most convincing thesis is that socioeconomic structures in Europe, China, Japan, and India were similar until the mid-18th century and diverged in the context of colonial and military domination.

Other Factors in Divergence

The Catholic Church developed a sophisticated system of financial, commercial, and property law.
Family structure may have played a role.
Geopolitical and religious motivations influenced European expansionism, such as the desire to encircle Islam.

Anthropological Connections

Claude Lévi-Strauss emphasized deep anthropological connections between the Far West and the Far East.
These regions had natural frontiers and were receptacles for mythologies and knowledge.
Research shows the importance of ritual constructions and the fragility of state structures.

The Role of History in State Construction

Religious, ideological, and anthropological factors influenced the history of Europe and the world.
The development of Western and world capitalism was based on the international division of labor and the exploitation of resources.
The state is inseparable from worldviews, ideologies, identities, institutions, languages, and “imaginary communities.”
State constructions have been controlled by dominant classes, but subaltern classes play a growing role in revolts and social struggles.
The state is neither egalitarian nor inegalitarian; it depends on who controls it and for what purpose.