Saturday, December 19, 2009

Piracy Ltd.

Somalian pirates who have made tons of money through ransoms now have set up a ‘stock exchange’ of sorts to manage their hard-earned investments, says Reuters in this report.

"The shares are open to all and everybody can take part, whether personally at sea or on land by providing cash, weapons or useful materials ... we've made piracy a community activity” says one of the pirates. "Ransoms have increased in recent months from between $2-3 million to $4 million because of the increased number of shareholders and the risks," he said.

This is hardly an innovation, considering the origin of joint stock companies and exchanges.

The British East India Company (probably only the second company, after the Dutch East India Company, to be formed as a joint-stock company) while ostensibly chartered to carry on trade with India actually built its fortunes by plunder. Here is a description in page 253 of a book “The reign of King George III” by Robert Bisset, published in 1816.

"Thus have we seen a mercantile company, in less than ten years, acquire by war and policy, more extensive possessions, and a richer revenue, than those of several European monarchs. This was an epoch in the history of conquest. Nations of merchants had before conquered very extensive dominions, but this was a mere corporate body of private subjects. The principles on which the servants of this company of merchants proceeded were formed in a great degree by the habits and conditions of the masters. The leading object was gain; ambition was only secondary and instrumental: power and dominion were esteemed merely as the means of profit.

Where the Romans carried their arms, they sought warlike glory, victory, and the splendor of triumph, as well as the gains of plunder ; they took their superstition with them : and from the conquered countries made additions to their gods, as well as to their treasury. The Spaniards, the creatures of gloomy bigotry, carried to Mexico their zeal for making converts, as well as for acquiring silver and gold. These and many other victors were actuated by various passions; but the British conquerors in India directed their pursuits to one object exclusively, the acquisition of money. They considered, in every transaction of war, peace, or alliance, what money could be drawn from the inhabitants.

In their modes of exaction from the feeble natives, they observed the systematic regularity of commercial habits; they made bargains; and for the money received, stipulated value delivered. They pillaged, not with the ferocity of soldiers, but with the cool exactness of debtor and creditor. Instead of saying to the sovereign of Hindostán, "You have a very rich territory, and we must have a great part of the product," (which might have appeared the language of robbers,) they adopted a mercantile mode: " We shall collect your revenue for you, reserving to ourselves " only eighty per cent, for factorage :" this was the spirit of their agreements. Before they planned aggression, they calculated the probable proceeds, the debts that they might extinguish, and the addition, on the balance of accounts, which they might make to the sum total.

They considered war with the natives, merely as a commercial adventure: by so much risk encountered, a certain quantity of blood spilt, and a certain extent of territory desolated, great sums were to be gained. In all their intercourse, however, with the natives, in the plans which they devised, and the efforts which they employed for the accumulation of wealth, they manifested the immense superiority of the British character with a rapidity of success, that brought an unprecedented influx of opulence to this country, and effected a considerable change in the sentiments, habits, and pursuits of Englishmen."


ramesh said...

wow a 19th century book critically analysing company rule!! what would we know without google...

Raj said...

ramesh, yes, 'Google Books' helps us do our own research and form independent opinions.