How Mercantilism Helped To Shape America
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How Mercantilism Helped to Shape the American Nation
In the Middle Ages, the definition of wealth was based on the amount of productive land. According to this definition, France was the wealthiest and therefore the most powerful of the European nations. During the sixteenth century the definition of wealth began to change. As the ability to conduct profitable foreign trade increased, so did the amount of cash. Thus, the new definition of wealth came to mean the gain of cash or specie. Specie included gold, silver, or bullion. The wealthiest nation became the one with the most cash, and therefore, the most powerful nation. As the redefining of wealth took hold, there was an increased desire and ability to conduct foreign trade on a larger scale as cash became the new medium of exchange in contrast to bartering. Mercantilism began to take hold of the countries of Europe. Mercantilism was characterized by the governmental regulation of industries, trade, and commerce. This was especially true with foreign trade, and was determined more by national aims rather than individual or local interests. This new quest for trade began the Age of Expansion in the early fourteen hundreds. This era ushered in a search for new sources of revenues, and focus turned toward the colonization of the New World. The Portuguese, Spanish, and English directed many efforts of colonization and development toward this new land in an attempt to establish themselves as the economic leaders of the world. As mercantilism began to change, so did the power flux of the European countries. Thus began the shaping of North America as we know it.
The Age of Expansion brought many changes to medieval Europe. During this period, the countries of Europe began to look beyond their borders. In Europe, there was nowhere to grow. This being the case, the only place to turn was west. Portugal came into existence in the early 1400s. It is a small country bordered on one side by the sea, and by Spain on the other. Out of necessity the Portuguese became the masters of the sea. They began to acquire a great knowledge of the sea and advanced in navigation, sailing, and map-making. They also founded an academy of navigation in Lisbon. In the early 1400s, the Portuguese began exploratory voyages. The Portuguese wanted to establish themselves in large-scale international trade. The four things most desired by the people of Europe were spices, sugar, precious metals, and silk. These goods were found primarily in the West Indies. In 1497, a Portuguese explorer named Vasco da Gama became the first European to sail around the Cape of Africa, allowing the Portuguese to establish colonies in East Africa and open new trade routes. By 1513, the Portuguese had established trade with much of the West Indies as far as the Spice Islands.
In the late 1400s, a man by the name of Christopher Columbus had the idea that he could reach the West Indies by a westward route over the Atlantic Ocean. He believed that he could find a westward route to the West Indies that would make trade much more feasible and that would supply desired goods to the European people. Desiring support for an exploratory voyage across the Atlantic Ocean, Columbus went to the most logical place – Portugal. For ten years he sought support for a voyage, but he never received the funding he needed. Since Portugal refused to provide him with the necessary support, he decided to try Spain. In 1492, Queen Isabella of Spain granted him a commission, and he sailed west with three ships. On October 12, 1492, the ships landed on an island which Columbus named San Salvador. He then claimed the land for the country of Spain. Columbus explored the Caribbean Islands and journeyed back to Spain believing he had found the West Indies. The focus of expansion now shifted to the New World. The Spanish began to establish colonies with the hope of turning a profit.
In 1521, Hernando Cortez, another Spanish explorer, conquered the Aztecs in Tenochtitlan (Mexico City). He later conquered the rest of Mexico, including the Mayan people. The Spanish also colonized Florida and claimed all the land west of the Mississippi River. Most of the conquered natives were put into slavery or forced labor. The Spanish operated vast silver mines and sugarcane plantations. Most of Spains profit came from silver and gold. The native peoples had mined much of it before the arrival of the Spanish, and the Spanish exploited these people for their wealth. There was a massive influx of cash into Europe. Spain began spending money as fast as it came in. The result was the Economic Revolution. Prices all over Europe fell because of rising inflation.
In 1497, the British sent an explorer named John Cabot on a voyage to North America. King Henry VII granted John Cabot a royal Charter. This charter, issued by the government, authorized Cabot to conduct a voyage in search of a Northwest Passage to the West Indies. The charter was only permission – not financial support. The Merchants of Bristol supplied the monetary support. Although Cabot did not find anything, his voyage served as a model for later English settlement of the New World. The North American colonies did not begin as royal colonies – they became royal colonies. The colonies began as individual economic ventures supported by joint-stock companies and given royal charters by the government. Cabot was the first man sent by Britain on a voyage to the New World. He was also the last for a long time.
The British were late starters in the race to establish colonies. They had become a fairly wealthy and powerful nation. As a result of this wealth, the people wanted more material things. These material goods had to come from somewhere, so money was being sent to other countries to purchase the desired things. This was an undesirable situation in the mercantile system. In an attempt to solve this problem, colonies were started to provide goods that could not be produced in the mother country. The British established their first settlement in the New World in 1607. This settlement was called Jamestown. The colony was funded by a group of private investors joined together to form the Virginia Company. The primary objective of this colony was to turn a profit for the investors. The primary source of income for colonists in Virginia was from the production of tobacco. The tobacco trade soon became this colonys major export to many countries all over the world. Another colony, financed by the Massachusetts Bay Company, was established in 1620. This colony was begun by a group of Puritans under the leadership of John Winthrop. The Puritans, also called the Pilgrims, established a colony on the Massachusetts Bay. They shipped lumber, built and outfitted ships, and carried on a good amount