By 1776, Charleston stood at the centre of the American War of Independence. Earlier that year, In March, South Carolina had adopted its own constitution, becoming one of the first colonies to do so. In June, British forces attempted to retake the city during the Battle of Sullivan’s Island but were driven back by American defenders.
At the same time, the war was disrupting commerce across the colonies. The port of Boston, once a primary destination for British imperial goods like rum and tea, had been closed to British ships since the Boston Tea Party of 1774. In 1775, Britain’s Prohibitory Act blockaded all American ports. The British government began to treat colonial ships as enemy vessels, while the Continental Congress organised widespread boycotts of British imports.
Trade between Britain and the American colonies collapsed almost overnight. That prompted widespread smuggling, as other European powers, like France, saw an opportunity. By assisting the colonists to break the blockade, French merchants were also striking a blow against their British rivals for control of the seas.
These events directly informed the debates in The Wealth of Nations. Adam Smith argued that colonial monopolies and trade restrictions harmed both Britain and America by protecting special interests – the few companies who controlled the transatlantic trade – rather than encouraging genuine prosperity. He believed freer trade would ultimately benefit populations on both sides of the Atlantic, and that improving quality of life for the population was the point of economic policy.
Smith’s readers among British political elites dismissed his warnings. In a letter dated June 6, on the eve of the failed British assault on Sullivan’s Island, the solicitor-general Alexander Wedderburn assured Smith that although he enjoyed the book, “Your Reflections [on] America are all confuted by the favourable accounts lately received…I have a strong persuasion that in spite of all our wretched Conduct, the mere force of government clumsily and unsteadily applied will beat down the more unsteady and unmanageable Force of a democratical Rebellion.” In 1783, the government in which Wedderburn served would be forced from office humiliated, after conceding defeat to that “democratical Rebellion.”
After independence, American politicians fiercely debated Smith’s ideas. Southern plantation states such as South Carolina often favoured exporting their agricultural goods abroad with fewer restrictions to reach the largest possible market, while northern states increasingly supported tariffs to protect their nascent manufacturing industries from European competition. Even figures who disagreed with Smith borrowed many of his economic arguments. Alexander Hamilton, for example, paraphrased from the Wealth of Nations in his contributions to the Federalist Papers and in his speeches promoting his financial plan for the new republic to Congress.
Image: “View of the Attack on Bunker’s Hill, with the Burning of Charles Town, June 17, 1775,” Engraving by John Lodge, public domain and courtesy Met Museum