The Opium Wars and Capital Accumulation: Comments on Karl Marx’s Perspectives on the Qing and England Recorded in The New York Herald Tribune

Cultural Conflict

In historical comparative studies, issues of cultural conflict have been one of the major themes when comparing the East and the West. The clash of cultural difference has been regarded as an element that ensured the East’s decline and the West’s ascent since the mid-nineteenth century and possibly earlier. In world history, without much disagreement, the Opium Wars were seen as a turning point from which the West grew stronger and stronger, and the East weaker and weaker. Specifically, when the British ambassador George Macartney (1737–1806) encountered Emperor Qianlong (1711–1799) in Beijing, the question of whether or not Macartney should kow-tow was viewed without question as the trigger for launching wars. Moreover, this moment of intense cultural conflict has been accepted as a major explanation for why the wars between Britain and the Qing was inescapable. This perspective has remained largely unquestioned, whether by scholars or history buffs. Here, three examples are provided to demonstrate.

To begin with, in The Opium Wars: The Addiction of One Empire and the Corruption of Another, Travis Hanes III and Frank Sanello devote an entire chapter to the causality between old-fashioned Chinese rituals and the Qing’s tragic downfall (Hanes III and Sanello 2005). Compared with the modern and civilized British, the Qing are depicted as stubborn, leading the authors to the conclusion that “the Opium Wars were an inevitable ending” (Hanes III and Sanello 2005, 13). But why couldn’t the differences between British and Chinese rituals be resolved through rational communication? Why were the Wars a foregone conclusion? Why were the supposedly civilized Britain so quick to resort to wars? This article has many objections to the conventional assumptions of these authors, and will elaborate on them below.

Second, while discussing the Treaty of Nanjing, Ma (2011, 201) suggests both that “what the Treaty solved is the Wars, but not cultural differences between the East and the West, and that the Heavenly dynasty was doomed not to get along with foreigners.” In other words, according to Ma, the sound of guns and cannons temporarily stopped but the cultural conflict continued. And yet, in previous decades the Heavenly dynasty seemed to have no difficulty engaging in trade as well as scholarly and technological exchange with foreigners. Centuries before, as well, the royal families of the Tang dynasty (618–907) seem to have interacted regularly with foreigners. Given this past amicable history, why, then, was the Heavenly dynasty doomed to create unsolvable problems with outsiders? In the Southern Song dynasty (1127–1279), numerous Arabians resided in Quanzhou. Indeed, this ancient world city eventually became another hometown for Arabian “outsiders.” Historically speaking, then, the Chinese have had intimate relationships with people from afar. What, then, is Ma’s rationale for suggesting that the Chinese were unable to get along with outsiders?

The third example is Alain Peyrefitte’s work, L’Emprie immobile ou le choc des mondes [Immobile Empire]. One of the main interests with this work revolves around the first encounter it depicts between Ambassador Macartney and Emperor Qianlong (Peyrefitte 2015). This unpleasant meeting, according to Peyrefitte, made the Wars unavoidable. It should be noted, however, that primary sources mention that Macartney dropped onto one knee rather than following “outmoded” Chinese rituals. Moreover, there is no record of Qianlong having been angered by Macartney’s “impoliteness.” It can be argued, therefore, that this encounter did not become a serious diplomatic event at the time, or at least it was less serious than Peyrefitte suggests. To summarize, cultural differences do not necessarily escalate into conflicts. Additionally, when the evidence does not support conventional views, it is the task of scholars to investigate factors that may be missing from the discourse due to biased oversight or deliberate attempts to revise historical memory.

In this article’s estimation, it is methodologically unsound to focus only on cultural conflict to understand important changes in human history. Such an approach makes researchers neglect the analysis of complicated politico-economic factors that might be more relevant. This article returns to this point in the next section, which is on industrial competition.

Industrial Competition between Qing China and Great Britain

This article starts the discussion by introducing one of Marx’s editorials, “Revolution in China and in Europe,” due to its pertinence to scholars’ concerns. Marx argues:

Especially given the paucity of data available on China 170 years ago, Marx’s research and insights regarding Qing officials’ worries over the shortage of silver are admirable.

But we need to emphasize two points, at least, in this leading article. The first one is about the confidence of British officials and merchants. After the Industrial Revolution, businessmen in Great Britain were generally confident about their products made in the then “modern” factories. The Chinese market was no exception. Second, in the mid-nineteenth century, Marx was already aware that the British were prone to unreliable statements when discussing the ideology of mercantilism. On the one hand, British merchants wanted to pursue so-called “free trade.” On the other, they knew full well that the most obvious way for them to correct the trade imbalance with China was to engage in the sale of opium, but that opium was prohibited by the Qing. Given the circumstances, the British would be able to sell opium to China only if through “unusual” means, that is to say, by launching wars. There are a number of doubts about the historical narrative handed down in the past century and more. If the goods made in British factories were well made and useful, why was opium the only item that could be sold profitably in the Chinese market? Would it not be ironic for an industrialized nation to promote an item that was not only agricultural but illegal? And yet, what could Britain possibly do if China decided to further erode British profits by refusing to legalize opium? In their desperation, British merchants apparently felt they had no choice but to continue to smuggle opium into China while parliament looked the other way in order to protect national interests.

In the paragraphs mentioned above, Marx states that the products made by British merchants were sold out in markets, no matter where they were. He also mentions that before 1830, China usually reaped positive results from international trade, i.e., the value of exports was higher than that of imports. In contrast, India, Great Britain, and America suffered from an unfavorable trade balance, with the result that silver constantly outflowed to the Qing’s treasury. But things began to change after 1830. China no longer enjoyed a favorable trade balance. Marx is therefore correct in arguing that China was losing its advantages. But a closer look at history indicates that the story would not have ended here, as the Qing had, to various degrees, suffered from trade losses since the 1830s and yet maintained its advantage overall. Given Marx’s astute observations regarding commerce between the West and the East, he would surely have had much to say about developments in the 1880s. Unfortunately, he died in 1883, too soon to assess some crucial events. This study aims to complement Marx’s original analysis.

When it comes to industrial competition, scholars have reached a general agreement. The conventional narrative is as follows: The 1780s Industrial Revolution had allowed Great Britain to produce commodities in accordance with capitalist principles, featuring mass production in factories. This reduced labor power and hydropower, thereby lowering the total cost of production. Inexpensive yet high-quality goods were produced in British factories for distribution to consumers around the world, including in China. Because these goods were competitively produced commodities in high demand, they were often sold out. The narrative continues that, after the Opium Wars, China was unable to escape its doomed fate. When foreign items came to China, local goods would have lost market share due to their poor competitiveness. In a nutshell, local companies were hard put to survive, as a result of the dire situation brought about by external competition. ⁴ This article underscores that this consensus viewpoint was already popular in the nineteenth century, and that Marx was no exception in his belief that the Industrial Revolution made British factory-made items absolutely competitive.

Elsewhere in “Revolution in China and in Europe,” Marx stated that “In China the spinners and weavers have suffered greatly under this foreign competition, and the community has become unsettled in proportion” (Marx 1853 [2010], 94). At first glance, this may sound like a plausible claim. However, there are some discrepancies between what Marx wrote and the historical facts. Marx believed that China’s cotton sector had lost its advantages since the 1830s and came to an end later on. But history tells us a different story. This article will delineate his oversights below, in order to complement the lacunae that he unintentionally left behind.

What Happened with Chinese Textiles after Marx’s Death

As noted above, Marx died in 1883, too soon to know the fate of China’s cotton textiles sector after the 1880s. As a matter of fact, cotton handicrafts were not defeated by global competition but survived beyond the late nineteenth century, even prospering in the early twentieth century. In this regard, the arguments of Hamilton and Chang (2003) are useful for understanding the developments in the Chinese textile sector after the mid-nineteenth century. They assert:

From the above, we see that Marx would have perceived cotton textiles in China as lagging behind from the 1840s onward. However, according to Hamilton and Chang (2003), China’s cotton handicrafts continued not only to survive until the 1920s, but even to flourish in some periods. Hamilton and Chang have an advantage over Marx, in that they have access to data that was not available during Marx’s lifetime. However, while Hamilton and Chang have raised an important point regarding the viability of cotton handicrafts into the twentieth century, they have not taken their assertions far enough. Some other studies, specifically the following one conducted by Chao and Chen (1977), can help us to explain the variety of interpretations. Chao and Chen, in our view, more fully supplement Marx’s observations of Chinese economic development that were cut short by his demise.

Chao and Chen suggest that from the 1880s onward, noteworthy changes took place in China’s native cloth sector. Given the timing of these changes, it is obvious that Marx could not possibly have learned what was happening in the industry in China. As for the substance of these changes, exports of China’s native cloth continued to grow and reached its peak in the early 1920s. On average, this highly competitive sector earned 4 million taels per year. This has something to do with the household production system, which consisted of millions of households around Jiangnan (the Lower Yangzi). One of the major characteristics is the employment of unpaid labor, notably females in local households. This system had defeated not only handicraft workshops but also competed with the then newly-established factories for cotton textiles (Chao and Chen 1977, 104–105). ⁵ One reason worthy of mention is that this system could reduce labor costs to a bare minimum. Then as well as in the present, handmade commodities often, if not usually, represented higher quality and thus were associated with higher status. In a sense, then, it can be argued that Hamilton and Chang’s (2003) research complements Marx’s writing on the development of China’s cotton textiles after 1830. What happened after 1840, then, for the outcome to differ from what Marx had expected? As Chao and Chen have noted, China’s cotton industry was hardly defeated by foreign competition after the Opium Wars as Marx argued would happen, but survived or even prospered in some decades. This is the main argument to be delineated by this current study.

As discussed above, then, the generally accepted viewpoint—that China’s textiles were seriously beaten after 1840—is inaccurate. More importantly, this erroneous way of thinking has been hidden deep in the minds of the contemporary Chinese intelligentsia and thus has remained difficult to remove. This reminds us of the critiques related to ambiguous historical writings about China, particularly the periods after the mid-Qing. Timothy Brook persuasively argues that Chinese scholars have relied on inappropriate concepts, borrowed from narratives related to capitalism, in trying to understand their own history. The primary argument to explain China’s economic and military defeat has been the Opium Wars, with a string of defeats at the hands of foreign powers following suit (Brook 1999). In particular, educated Chinese after the mid-nineteenth century blindly accepted Western binaries regarding attempts to understand China by differentiating only between capitalism and feudalism (or non-capitalism). In other words, the intelligentsia were persuaded through their Westernized training methods to believe that China’s long and non-capitalist past made their giant country stagnant. Therefore, when concerning themselves about Chinese industrial competition against Western powers, scholars’ and pundits’ minds usually, if not always, came up with the Industrial Revolution first, then the concomitant factories, large-scale production, higher productivity, and lack of solutions for the problem of overproduction, as the catalyst for China’s defeat in the textiles market. ⁶ According to Brook, this perspective is the same reason why Marx believed that after the 1830s China’s cotton textiles looked unpromising.

Another editorial by Marx, “The Crisis in England,” tells us that England did not have an advantage in terms of industrial competition. Overproduction is simply too common, and thus Britain could not escape such an unlucky destiny either. “The Crisis in England” reveals that as early as September 1854, Marx was already noticing a problem with overproduction in British factories, despite the confidence of British businessmen in 1855 about items made in their factories, starting with the printing factories of Manchester and its suburbs. Belying their confidence, however, some businesses and even time-honored stores faced collapse. Some shipowners, especially those who conducted business with the Chinese, and subsequently those who traded with businesspersons in California and Australia were all confronted with bankruptcy. Finally, those who did business with the Chinese and Indians faced similar difficulties resulting from overproduction (Marx 1855a [2010], 61).

But what does overproduction mean? If specific goods could find consumers in some markets, then none would worry about the problems, such as the extra cost of materials, inventories, personnel, and the like, that overproduction could cause. Why were the British merchants bankrupt? This is simply because there were (far) fewer consumers than expected. At that time, British legislators were worried about the substantial amounts of silver outflow. This concern indicates their understanding that Britain was not only incapable of accumulating capital but also was incapable of stopping the leak of its national strength. From their perspective, therefore, what Britain had to do was to find at least one item to attract Chinese consumers and thereby reduce the trade imbalance. But unfortunately, not a single item could be identified. Here we briefly repeat that generally agreed-on viewpoint, as follows: After the Industrial Revolution, British merchants occupied an advantageous position in the worldwide competition simply because of the early adoption of technologies and methods of mass production. Accordingly, without much difficulty, Britain should have found commodities favored by consumers, sold them to China, and reversed the direction of silver flows. But in reality, this agreed-on viewpoint never materialized. Zhao in his “Rethinking the Chinese World Order” outlines the dire situation in Britain at the time and has these observations to share:

Zhao states that British merchants failed in their efforts to market British wares to consumers, but that an agricultural item, opium, was identified as a potentially lucrative commodity that could be brought into China. Clearly, the merchants involved were unconcerned about what they were selling as long as it sold. Their ruthlessness is a testament to the fact that it was a challenge for them to sell factory-made items in the Zhujiang Delta, where consumers were relatively affluent and were not easily satisfied. British-made cotton and sewing needles did not perform well on the market, as there was nothing special about them in the minds of prosperous Chinese consumers.

With respect to Britain’s national wealth, no alternative seems to have been available than the opium trade. But how is it that this illegal business managed to become an alibi for launching wars? This kind of immorality from an ostensibly civilized Christian nation would have needed to be beautified by the imperial media, a useful tool to (re-)strengthen cultural hegemony that will be discussed later. Not surprisingly, Marx had something to say about the coexistence of illegal opium and legal commodities. In “History of the Opium Trade,” Marx insightfully noted that, “The Chinese cannot take both goods and drug . . . extension of the Chinese trade resolves into an extension of the opium trade; the growth of the latter is incompatible with the development of legitimate commerce . . .” (Marx 1858a [2010], 14). From a long-term perspective, the British should have developed trade with China in a lawful way. But from a short-term one, Marx is correct in arguing that Britain did not give much thought to the ban on opium. After all, neither British parliamentarians nor merchants could possibly have given up such a highly profitable business simply because it was immoral.

As the world’s first industrialized country, the best-selling British commodity was not made in its then-modern factories. Instead, an agricultural item, opium, is what helped Britain earn back its money. It is doubtful that the success of the Industrial Revolution was supported, to a great extent, by the opium trade. In “Revolution in China and in Europe,” Marx expressed sympathy toward China about the effect of the trade, sighing that “It would seem as though history had first to make this whole people drunk before it could rouse them out of their hereditary stupidity” (Marx 1853 [2010], 94). In contrast to Marx’s opinion, however, it is British drug purveyors that wanted to make the Chinese drunk.

Hypocritical Mercantilists: Royal Families and Businessmen

Now let us examine how Marx could see through the hypocrisy of the British royal family and London-based merchants involved in trade with China. Simply put, the British gentlemen were not only mercantilists—usually with the support of military force—attempting to earn high profits, but they also cared greatly about their prestige and thus made efforts to beautify their aggressive and predatory actions worldwide.

Marx penned three editorials regarding their hypocrisy. The first one, already discussed above, was published on September 20, 1858, and titled “History of Opium Trade.” The second one, also called “History of Opium Trade,” was published on September 25, 1858. The third one, published in October 1859, is called “The New Chinese War.” Some paragraphs in these leading articles are worthy of our attention. The first article says:

Significantly, the EIC had monopolized the production of opium, but ships owned by the company did not carry the illegal drug. The EIC instead issued licenses to Chinese ships, which were banned from carrying goods other than the EIC’s opium. In other words, licensed Chinese ships could only carry opium monopolistically produced by the EIC. This meant that all profits went into the EIC’s pockets, and yet the EIC also managed to avoid the unfortunate title of drug dealer. Marx disapprovingly observed that “While the semi-barbarian [Chinese] stood on the principle of morality, the civilized opposed the principle of pelf” (Marx 1858a [2010], 16).

We move to the second editorial, also called “History of Opium Trade.” In this article, Marx used the adjective “hypocritical” to represent the British government. He writes:

The British government banned the opium trade, but this was only lip service. Although it appeared as if there was no relationship with drug smuggling, in its actions as the Indian government, it forced Bangladesh to engage in opium planting and adjust the flavor to satisfy Chinese taste. More importantly, the EIC did not deliver the opium itself but asked private merchants to do so. This company thus avoided condemnation quite successfully, while benefiting from profit margins as high as 540% (Marx 1858d [2010], 19). Until the first of Marx’s two articles titled “History of Opium Trade” was published in 1858, the EIC continued to smuggle drugs to China and conducted this highly profitable business through the activities of private merchants. It was in this very year that Britain (and France) forced China to accept opium as a legal item on which customs taxes could be levied. Marx’s comments suggest that he was able to foresee what would happen in the Far East after his untimely death.

Marx’s third article, “The New Chinese War,” refers to the Second Opium War. The paragraph related to our concern is relatively short, but the following sentences orchestrate the argument, that is: the reason for waging a war is not necessarily convincing as long as people are willing to believe it. More importantly, the true reason—reaping economic benefits or accumulating capital—must remain hidden. Marx argues:

This short paragraph was published in September 1859, during the Second Opium War. In the First Opium War, Britain could only clandestinely transport opium into China. This notion troubled the British because their interests could potentially have been interrupted. Additionally, the British government knew from experience that wars could make the situation easier to manipulate. One principle needed to be obeyed, however: Any greed over money or capital must be concealed. In accordance with mercantilist principles, all effort must be made to ensure that a war has nothing to do with chasing profits. This is why Marx argued that Britain might conceivably maneuver toward a third war or even a fourth one. Yet again, war was being waged as a quick method for accumulating capital and national wealth. With respect to national wealth, the name of Adam Smith comes to mind. The ideology of “free trade” was supported by British legislators and merchants alike, making Britain more prosperous than other nations. Indeed, Smith did not speak out directly against the trade of opium. In other words, the British followed both what Smith said and what he did not say.

From this discussion, we have observed that before the 1850s Great Britain employed illegal and immoral methods to accumulate capital. And a major approach for gathering wealth is war, a fact conventionally ignored by scholars. Now, to further clarify our vision which was only vaguely delineated earlier, let us analyze a few cases to show the intimate relationship between the British royal family and pirates. The following events happened centuries before the Opium Wars took place. In other words, Britain employed wars as a method for the rapid accumulation of capital much earlier than discussed above. Isami Takeda suggests that the reason why English hegemony came into existence is the close connection between Queen Elizabeth I (1533–1603, r. 1558–1603) and pirates. A leading pirate, Francis Drake, won the Queen’s highest “respect” because of the profits he achieved. But how much money did Drake bring Elizabeth I? One estimate shows that “he gave 600,000 pounds to the government and 300,000 went into the Queen’s pocket. At that time, six hundred thousand pounds equaled three years’ fiscal budget for the government” (Takeda 2012, 19). These are the kind of high returns that encouraged officials and bandits to collaborate.

As a matter of fact, Queen Elizabeth I entrusted Drake’s pirate groups to function as fighting ships for England. Drake had shown his capability by circumnavigating the earth. In 1582, Drake became the mayor of Plymouth as he had long wished and was heralded as a national hero. After this appointment, the Queen assigned several missions to Drake, such as “to plunder the Caribbean (September 1585 to July 1586),” “Ambushing the Spanish Cadiz and robbing the Spanish King’s ships (April to July 1587,” “Attacking and Destroying the Armada (July to August 1588),” and “As the Commander of an Expedition in the Iberian Peninsula,” and so on (Takeda 2012, 442–443).

From the above, Great Britain has wholeheartedly embraced the ideology of mercantilism. To achieve its aim, i.e., accumulating capital more quickly than other Western competitors, Britain conducted unlawful activities so as to win an advantageous position in the world’s zero-sum game. It is not unreasonable to claim that the present-day statuses of the world’s so-called advanced nations must have something to do with their misconduct in past centuries. But who has helped to camouflage the dubious conduct of the so-called “advanced” countries and their misbehaviors? We investigate this in the next section.

The Camouflaging of British Cultural Hegemony by The Economist

In the contemporary era, it is commonly recognized that cultural hegemony can help us understand the high-ranking positions of core countries in economic, political, diplomatic, and military terms. In addition, in terms of cultural “advantageousness,” core economies always enjoy their priorities through discourse power—the right to set agendas—that allows them to strengthen their hegemonic statuses. Nevertheless, it is less well known that as early as the mid-nineteenth century, Britain had already been skillfully operating a kind of cultural hegemony almost exclusively enjoyed by the most “advanced” economy.

Marx referred at least twice in The New York Herald Tribune to the political standing of The Economist and this journal’s opinions on some important events. In other words, at least two editorials show that The Economist was indeed a camouflage artist for the British government. These two articles were both published in October 1858, with one on the 5th (titled “The Anglo-Chinese Treaty”) and the other on the 15th (“The British and Chinese Treaty”). In the first article, Marx tries to identify the reason(s) why the First Opium War (1842) failed to meet the British goal of harvesting more reimbursements in terms of interests. This way of thinking was pervasive at the time the article was published in 1858. The Economist, the then-famous journal of free-trade factions, also admitted this failure. According to Marx, “Having stood forward as one of the staunchest apologists of the late invasion of China, that journal now [1858] feels itself obliged to ‘temper’ the sanguine hopes [regarding expectations toward high demand from China for British industrial products]” (Marx 1858c [2010], 28).

In the second article, Marx discusses the greed revealed by The Economist. He argues that the

Although these two articles are interrelated in terms of addressing “business” interests, we must recognize that these sorts of interests—the amounts of accumulating capital—used military force to threaten those who were unwilling to accept the conditions imposed by Britain. In a nutshell, it is reasonable to argue that cultural hegemony was already fully on display in the middle of the nineteenth century. There is no need to point to more recent examples.

In the present day, many Chinese benefit from the learned arguments explicated by The Economist. But few of these readers have paused to think about the historical reality that, more than a hundred years ago, this journal supported the Opium Wars without hesitation. Human history is full of such ironies.