16 GENERAL EXPANSION OF CAPITALISM capitalist industries,1 or by building up large undertakings gained command over the most important English industries of the time. The special form of organisation which was characteristic of this early industrial capitalism up till the end of the seventeenth century was the monopoly. CHAPTER II THE ORGANISATION OF MONOPOLIES THE legal foundation of monopoly rested on the grant by the Crown to individuals or corporations of the sole right to carry on a given trade. Under Queen Elizabeth the system of trade privileges, as is well known, grew rapidly. There was scarcely a commodity which was not the object of a monopoly. On one occasion, when a long series of concessions was recited in Parliament, a member exclaimed "Is not bread in the number?" And to the astonished cries of "Bread!" he replied, "Yes, I assure you, if affairs go on at this rate, we shall have bread reduced to a monopoly before the next Parliament."1 Elizabeth had repeatedly to promise the abolition of monopolies, and finally, in 1601, after a Parliamentary debate in which most of the speakers expressed in the most unequivocal terms their exasperation with the existing privileges, a great number of exclusive rights were in fact suppressed.3 But the era of monopoly was by no means ended thereby. The creation of grants, patents, etc., continued under James I. and reached a new highwater mark between 1614 and 1621. The reply to this development was the well-known Anti-Monopoly Act of 1F. W. Hirst, Monopolies, Trusts and Cartels,' London, p. 17; and for particular cases of monopoly, C. Fisk Beach, Monopolies and Industrial Trusts,' St. Louis 1898, p. 10 and seq.; also Palgrave's 'Dictionary,' vol. ii. p. 802. 2‘Parliamentary History,' vol. i. London 1806, pp. 925 and 929. 3 Ibid. p. 935. B 18 MONOPOLIES UNDER ELIZABETH & JAMES I. 1624.1 The effect of this Act, which is still of importance to English lawyers, has often been wrongly estimated, so far as it concerned the actual creation of monopoly. M'Culloch, for instance, was of opinion that it had given freedom of trade to English industry. The terms of the Act may no doubt have been inspired by doctrines akin to free trade, but it would be a mistake to imagine that it abruptly terminated the existence of monopolies, which, on the contrary, appear to have continued for decades afterwards in spite of this express prohibition. The explanation is this. In the first place the Act itself left a whole series of monopolies untouched, and secondly, it was divided into two parts, one of which consisted of an emphatic condemnation of all monopolist undertakings, while the other at the end of the statute (sections xii.xiv.) sanctioned afresh certain important monopolies. As has been said, the entire statute is characteristic of its creator, James I., the prince "with a head of gold and feet of clay." At the same time, the Act of 1624 would have greatly limited the power of monopoly, had it not been frequently transgressed subsequently. Charles I.'s claims to rule without Parliament and to be financially independent of Parliament, drove him to follow in the steps of his predecessors and to have recourse to the grant of patents. For this purpose especial use was made of the clause of the statute (section ix.) which excepted civic corporations and companies from its provisions. It is true that originally it was only permissible to set up a corporation of a monopolist character within the area of a given town, and that in that town membership of such a corporation might not be restricted without further formalities. But the enterprising spirits who wished to conceal under such a corporation a national monopoly soon found a way out. They obtained a grant by royal ordinance of the right of superintendence" over the whole national production, and 121 Jac. i. cap. 3. 2 M'Culloch, 'Dictionary of Commerce,' London 1882, p. 895. ANTI-MONOPOLY STATUTE OF 1624 19 finally a right to suppress all outsiders. The traditional right of the free burgess, especially the free burgess of London, to enter any company for the practice of his trade was similarly suppressed. In this way the London Starchmakers' Company, an undertaking managed by a few capitalists, had already become a closed national monopoly even before the Anti-Monopoly Act.1 The Act made this method of founding a monopoly very popular, and after 1624 numerous corporations arose with the express object of forming national monopolies.2 The provision of the Act (section vi.) which allowed a fourteen years' patent for new discoveries opened up a further possibility or point of departure for the grant of monopoly. Starting from this vantage ground the possessor of a patent could acquire all kinds of privileges. He could be given a patent for his particular process and at the same time the right "for the protection of his patent," to keep watch on all other producers, a measure which in practice led to the exercise of monopoly rights.3 A later writer even complains bitterly that this clause had been stretched to cover imported goods, unknown to English manufacturers, so that anyone who promised to produce such commodities in England could obtain protection against both foreign and internal competition. The use of the clause as to patents for purposes of monopoly was so general that the word "patentee" meant in the period from 1630 to 1650 “monopolist." "The Monopolist and the Patentee Did joyne hand in hand as here you see is the legend under the frontispiece to an anti-monopolist pamphlet of 1642. With justice did a member of 1 Price, 'Patents of Monopoly,' pp. 37-8. 2 Unwin, 'The Gilds and Companies of London,' London 1908, pp. 294-5 and pp. 317-8. 3 Price, p. 119 and passim. 4' Britannia Languens or a Discourse of Trade,' London 1680, p. 85. 5 The Projectors' Downfall,' London 1842, title page. Parliament declare, in a debate in 1640:1 "Better laws could not have been made than the Statute of Monopolies against Projectors; and yet, as if the law had been the author of them, there have been during these few years more monopolies and infringements of liberties than there have any year since the Conquest." 2 In view of the Elizabethan monopolies, the last statement seems somewhat exaggerated, but the substance of the complaint is certainly true. The remarks of speakers from all parties during the debate prove the existence of a profusion of monopolists: The sarcastic speech of Sir John Colepepper in 1640 was famous. In one passage he declares that "these, like the frogs of Egypt, have gotten possession of our dwellings, and we have scarcely a room free from them. They sip in our cup; they dip in our dish; they sit by our fire. We find them in the dye vat, the washing bowl, and the powdering tub. They share with the butler in his bar. They have marked and sealed us from head to foot. They will not bate us a pin." 3 It must especially be remembered, in considering the effect of the Monopoly Act, that the legal conditions in mining up till the end of the seventeenth century offered in many ways great advantages for the creation of monopolies. The right of the Crown to claim ownership of all mines in which silver and gold were found became a means of monopolising copper, lead, and zinc mines. Since the time of Elizabeth the Crown had exercised this contingent right, not without provoking many lawsuits, and it led to the formation of the great 1 'Parliamentary History,' vol. ii. p. 650. 2 Mr. F. C. Montagu in his 'History of England' (London 1907, vol. vii. p. 181) thinks that the Act of 1624 was evaded on the pretext that it only relates to monopolies given to individuals. For this opinion he gave no evidence. It is clear that the Act forbade all monopolies, whether for individuals or bodies corporate or politic whatsoever. Also monopolies were granted to individuals after 1624, just as before, e.g. one for glass in 1634. 3 Parliamentary History,' vol. ii. p. 654-5. 4 Cf. detailed list of cases in Abbott, Essay on the Mines of England' (London 1853), pp. 218-9 ff., seq.; Lewis, 'Stannaries,' p. 76. |