Company Rule: The British East India Company
Charles W. King
Recently President Trump reaffirmed the United States’ commitment to the war in Afghanistan and pledged to send 4,000 troops to supplement the approximately 8,000 American and 6,000 allied troops in Afghanistan. While the President did not ultimately adopt it, there was an alternative which has received significant attention over the past few weeks. This alternative, advocated by Eirk Prince of Blackwater fame, is explicitly modeled on that of the British East India Company. According to Prince replacing American troops with private contractors could save the United States billions and defeat the Afghan Taliban. He claims to have thousands of retired American and NATO Special Forces ready to do this work, but experts contend that the potential talent pool of available Western Special Forces is nowhere near deep enough to supply Prince’s proposal. Also worth highlighting is that according to sources inside the White House, as reported by Foreign Policy, the thing that may have change the President’s mind on Afghanistan is the presence of extensive mineral deposits now being developed by Chinese companies, companies which may have links to Prince. While these reasons alone should be enough to give pause to anyone examine Prince’s proposal, it is also worth examining the model that he proposes.
The British East India Company was granted a Royal Charter by Queen Elizabeth I on December 30th, 1600 for the purpose of establishing trade between Britain and the Far East. At the time the protections of incorporation were only granted to ventures that advanced government agendas. Frequently, as in the case of the EIC, incorporation came with monopoly rights as well. The EIC’s most important monopolies were tea and saltpeter; the former being an inciting cause of the American Revolution, the latter being a key strategic resource. The Company would rule India for almost one hundred years before being stripped of its control of India in response to the Indian Rebellion of 1857.
In addition to the proximate causes of the 1857 rebellion (British attempts to change social norms of both the military and civilian population, and the adoption of greased rifle cartridges) company rule in India and well as later administration by the British Raj which replaced it, witnessed large scale famines as the result of typical drought seasons. One third of the population of Bengal died in 1770 as a result of Company rule. Tens of millions of Indians died as a result of these famines; meanwhile India was a net exporter of cereal grains, a subject we have touched upon before.
The British East India Company was not a successful business venture. The British Parliament was forced to bail it out numerous times between 1600 and 1857. It was a brutal instrument of imperial power. It exercised control of the Indian subcontinent thought violence, subject to little to no oversight from London. The Company facilitated control over the economies of the British Empire’s other possessions, including the Thirteen Colonies and the Empire’s African colonies. It was an engine for the extraction of resources and wealth from the colonies for the benefit of London, and it demonstrated phenomenal disregard for the value of human life in doing so. It is not an example that the United States should seek to emulate.