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I. THE COLONIES AND THE MOTHER COUNTRY
FROM the middle of the seventeenth century it had been the policy of the English Parliament to regulate the trade of the American colonies with primary reference to the interests of British merchants. A long series of statutes, known collectively as the Navigation Acts or Acts of Trade, were eventually passed to secure these results. The acts were restrictive in that they debarred foreigners, especially the Dutch, from participation in the colonial carrying trade, but they were not oppressive, nor did they on the whole seriously interfere with the development of colonial commerce. As an offset to some of the acts, bounties were granted on the production or exportation of specified articles, as, for example, on the rice of Carolina. Viewed from the standpoint of the present day, the policy of England was short-sighted. It was, however, in accord with the prevailing political and economic theories of the time, which looked upon a colony as a possession to be exploited for the benefit of the mother country.
From the beginning, however, the Acts of Trade had been more or less systematically evaded by the colonies, particularly by New England. The most lucrative commerce of New England in the early part of the eighteenth century was with the French and Dutch sugar-producing colonies in the West Indies, and this trade, though forbidden by law, continued to thrive, and in no small part with the connivance of the customs officials. From time to time the English merchants complained to the Lords of Trade — the committee of the Privy Council through which the affairs of the colonies were administered — of their loss of revenue, but political corruption in England was so firmly intrenched that no effective steps toward reform were taken for some time. The capitulation of Montreal, in 1761, carried with it the surrender of all Canada, and by the treaty of Paris, in 1763, which closed the Seven Years' War, the whole of the continental possessions of France in North America passed into the control of Great Britain. The colonies had exerted themselves to the utmost during the war, and many of them had incurred large debts, notwithstanding the reimbursement by Parliament of a considerable part of their expenses. There were loud complaints in England, however, of the cost of the war, and particularly of the increase of the national debt, now amounting to about 4, 140,000,ooo. The immediate advantage of the war, in freedom from French aggression, obviously accrued to the colonies rather than to the mother country, while the likelihood of a renewal of the war by France as soon as a convenient opportunity offered made it clear that what had been won must also be defended. The time seemed ripe, therefore, for some reorganization of the colonial system, with a view to the more effective control of the colonies by Great Britain. When, in February, 1763, Charles Townshend became First Lord of Trade in the brief ministry of Lord Bute, it was announced that requisitions on the colonial assemblies were to give place to taxes laid by Parliament, that colonial governors and judges were thereafter to be paid by the Crown instead of by the colonies, and that a small standing army was to be maintained in America at colonial expense. - Grenville, who succeeded Bute as prime minister in April, had been one of the Secretaries of State in the previous administration, and was especially well informed in regard to colonial matters. He resolved to put an end to American smuggling, the extent of which had greatly increased during the war. “The Commissioners of Customs were ordered at once to their posts. Several new revenue officers were appointed with more rigid rules for the discharge of their duties. The Board of Trade issued a circular to the colonies representing that the revenue had not kept pace with the increasing commerce, and did not yield more than one-quarter of the cost of collection, and requiring that illicit commerce should be suppressed, and that proper support should be given to the customhouse officials. English ships of war were at the same time stationed off the American coast for the purpose of intercepting smugglers.” "