Embargo Act of 1807
The Embargo Act of 1807 was a general trade embargo on all foreign nations enacted by the United States Congress. As a successor or replacement law for the 1806 Non-importation Act and passed as the Napoleonic Wars continued, it represented an escalation of attempts to coerce Britain to stop its impressment of American sailors and to respect American sovereignty and neutrality, while also attempting to pressure France and other nations in pursuit of general diplomatic and economic leverage.
In the first decade of the 19th century, American merchant shipping grew. Particularly Britain, but also France, thus targeted neutral American shipping as a means to disrupt enemy trade. American merchantmen, their cargo, and sometimes crew members were seized as contraband of war by European navies, sometimes under cover of official orders. The British Royal Navy, in particular, resorted to impressment, forcing some American seamen into naval service on the pretext that the seamen had been "born British" and were still British subjects. Americans saw the Chesapeake–Leopard affair as a glaring example of a British violation of American neutrality.
Congress imposed the embargo in direct response to these events. President Thomas Jefferson acted with restraint, weighing public support for retaliation while recognizing that the United States was far weaker than Britain or France. He recommended that Congress respond with commercial warfare, a policy that appealed to Jefferson both for being experimental and for foreseeably harming his domestic political opponents more than his allies, whatever its effect on the European belligerents. Congress, controlled by the President's allies, agreed, and the Act was signed into law on December 22, 1807.
The embargo failed totally. It did not improve the American diplomatic position, highlighted American weakness and lack of leverage, significantly damaged only the American economy, and sharply increased domestic political tensions. Both widespread evasion of the embargo and loopholes in the legislation reduced its impact on its targets. British commercial shipping, which already dominated global trade, was successfully adapting to Napoleon's Continental System by pursuing new markets, particularly in restive Spanish and Portuguese South American colonies. Thus, British shippers were well-positioned to grow at American expense when the embargo reduced American trade activity.
The embargo undermined American unity, provoking bitter protests, particularly in New England commercial centers. Support for the declining Federalist Party, which intensely opposed Jefferson, temporarily rebounded, driving electoral gains in 1808. The embargo simultaneously undermined Americans' faith that their government could execute laws fairly while strengthening European perception that its republican form of government was inept and ineffectual. Replacement legislation for the ineffective embargo was enacted on March 1, 1809, in the last days of Jefferson's presidency. Tensions with Britain continued to grow, leading to the War of 1812.
Background
After the short truce in 1802–1803 the European wars resumed and continued until the defeat of Napoleon in 1814. The war caused American relations with both Britain and France to deteriorate rapidly. There was grave risk of war with one or the other. With Britain supreme on the sea, and France on the land, the war developed into a struggle of blockade and counter blockade. This commercial war peaked in 1806 and 1807. Britain's Royal Navy shut down most European harbors to American ships unless they first traded through British ports. France declared a paper blockade of Britain and seized American ships that obeyed British regulations. The Royal Navy needed large numbers of sailors, and saw the U.S. merchant fleet as a haven for British sailors.The British system of impressment humiliated and dishonored the U.S. because it was unable to protect its ships and their sailors. This British practice of taking British deserters, and often Americans, from American ships and forcing them into the Royal Navy increased greatly after 1803, and caused bitter anger in the United States.
On June 21, 1807 the American warship USS Chesapeake was attacked and boarded on the high seas off the coast of Norfolk, VA by the British warship HMS Leopard. Three Americans were dead and 18 wounded; the British impressed four seamen with American papers as alleged deserters. The outraged nation demanded action; President Jefferson ordered all British ships out of American waters.
Initial legislation
Passed on December 22, 1807, the Act:- laid an embargo on all ships and vessels under U.S. jurisdiction,
- prevented all ships and vessels from obtaining clearance to undertake in voyages to foreign ports or places,
- allowed the President of the United States to make exceptions for ships under his immediate direction,
- authorized the President to enforce via instructions to revenue officers and the Navy,
- was not constructed to prevent the departure of any foreign ship or vessel, with or without cargo on board,
- required a bond or surety from merchant ships on a voyage between U.S. ports, and
- exempted warships from the embargo provisions.
The Embargo Act of 1807 is codified at 2 Stat. 451 and formally titled "An Embargo laid on Ships and Vessels in the Ports and Harbours of the United States". The bill was drafted at the request of President Thomas Jefferson and subsequently passed by the Tenth U.S. Congress, on December 22, 1807, during Session 1; Chapter 5. Congress initially acted to enforce a bill prohibiting imports, but supplements to the bill eventually banned exports as well.
Impact on U.S.
The embargo effectively throttled American overseas trade. All areas of the United States suffered. In commercial New England and the Middle Atlantic states, ships sat idle. In agricultural areas, particularly the South, farmers and planters could not sell crops internationally. Scarcity of European goods stimulated American manufacturing, particularly in the North, but with manufacturing in its infancy and with Britain still able to export to America particularly through Canada, this benefit did not compensate for the loss of trade and economic momentum. A 2005 study by economic historian Douglas Irwin estimates that the embargo cost about 5 percent of America's 1807 GNP.Case studies
A case study of Rhode Island shows the embargo devastated shipping-related industries, wrecked existing markets, and caused an increase in opposition to the Democratic–Republican Party. Smuggling was widely endorsed by the public, who viewed the embargo as a violation of their rights. Public outcry continued, helping the Federalists regain control of the state government in 1808–09. The case is a rare example of American national foreign policy altering local patterns of political allegiance. Despite its unpopular nature, the Embargo Act did have some limited, unintended benefits to the Northeastern region especially as it drove capital and labor into New England textile and other manufacturing industries, lessening America's reliance on the British.In Vermont, the embargo was doomed to failure on the Lake Champlain–Richelieu River water route because of Vermont's dependence on a Canadian outlet for produce. At St. John, Lower Canada, £140,000 worth of goods smuggled by water were recorded there in 1808 – a 31% increase over 1807. Shipments of ashes nearly doubled to £54,000, but lumber dropped 23% to £11,200. Manufactured goods, which had expanded to £50,000 since Jay's Treaty of 1795, fell over 20%, especially articles made near tidewater. Newspapers and manuscripts recorded more lake activity than usual, despite the theoretical reduction in shipping that should accompany an embargo. The smuggling was not restricted to water routes, as herds were readily driven across the uncontrollable land border. Southbound commerce gained two-thirds overall, but furs dropped a third. Customs officials maintained a stance of vigorous enforcement throughout and Gallatin's Enforcement Act was a party issue. Many Vermonters preferred the embargo's exciting game of revenuers versus smugglers, bringing high profits, versus mundane, low-profit normal trade.
The New England merchants who evaded the embargo were imaginative, daring, and versatile in their violation of federal law. Gordinier examines how the merchants of New London, Connecticut, organized and managed the cargoes purchased and sold, and the vessels used during the years before, during, and after the embargo. Trade routes and cargoes, both foreign and domestic, along with the vessel types, and the ways their ownership and management were organized show the merchants of southeastern Connecticut evinced versatility in the face of crisis.
Gordinier concludes the versatile merchants sought alternative strategies for their commerce, and to a lesser extent, for their navigation. They tried extra-legal activities, a reduction in the size of the foreign fleet, and the re-documentation of foreign trading vessels into domestic carriage. Most importantly, they sought new domestic trading partners, and took advantage of the political power of Jedidiah Huntington, the Customs Collector. Huntington was an influential member of the Connecticut leadership class ; he allowed scores of embargoed vessels to depart for foreign ports under the guise of "special permission." Old modes of sharing vessel ownership in order to share the risk proved to be hard to modify. Instead established relationships continued through the embargo crisis, in spite of numerous bankruptcies.
Enforcement efforts
Jefferson's Secretary of the Treasury Albert Gallatin was against the entire embargo, foreseeing correctly the impossibility of enforcing the policy and the negative public reaction. "As to the hope that it may...induce England to treat us better," wrote Gallatin to Jefferson shortly after the bill had become law, "I think is entirely groundless...government prohibitions do always more mischief than had been calculated; and it is not without much hesitation that a statesman should hazard to regulate the concerns of individuals as if he could do it better than themselves."Since the bill hindered U.S. ships from leaving American ports bound for foreign trade; it had the side-effect of hindering American exploration.
First supplementary act
Just weeks later, on January 8, 1808, legislation again passed the Tenth U.S. Congress, Session 1; Chapter 8: "An Act supplementary..." to the Embargo Act. As historian Forrest McDonald wrote, "A loophole had been discovered" in the initial enactment, "namely that coasting vessels, and fishing and whaling boats" had been exempt from the embargo, and they had been circumventing it, primarily via Canada. This supplementary act extended the bonding provision to those of purely domestic trades:- Sections 1 and 2 of the supplementary act required bonding to coasting, fishing and whaling ships and vessels. Even river boats had to post bond.
- Section 3 made violations of either the initial or supplementary act an offense; failure of the shipowner to comply would result in forfeiture of the ship and its cargo, or a fine of double that value, and denial of credit for use in custom duties; a captain failing to comply would be fined between one and twenty thousand dollars, and would forfeit the ability to swear an oath before any customs officer.
- Section 4 removed the warship exemption from applying to privateers or vessels with a letter of marque.
- Section 5 established a fine for foreign ships loading merchandise for export, and allowed for its seizure.
With the coming of the spring, the effect of the previous acts were immediately felt throughout the coastal states, especially in New England. An economic downturn turned into a depression and caused increasing unemployment. Protests occurred up and down the eastern coast. Most merchants and shippers simply ignored the laws. On the Canada–US border, especially in upstate New York and Vermont, the embargo laws were openly flouted. Federal officials believed parts of Maine, such as Passamaquoddy Bay on the border with British-held New Brunswick, were in open rebellion. By March, an increasingly frustrated Jefferson was resolved to enforce the embargo to the letter.
Other supplements to the Act
On March 12, 1808, Congress passed and Jefferson signed into law yet another supplement to the Embargo Act. This supplement prohibited, for the first time, all exports of any goods, whether by land or by sea. Violators were subject to a fine of US$10,000, plus forfeiture of goods, per offense. It granted the President broad discretionary authority to enforce, deny, or grant exceptions to the embargo. Port authorities were authorized to seize cargoes without a warrant and to try any shipper or merchant who was thought to have merely contemplated violating the embargo.Despite the added penalties, citizens and shippers openly ignored the embargo. Protests continued to grow; and so it was that the Jefferson administration requested and Congress rendered yet another embargo act.
Consequences
The Embargo was hurting the United States as much as Britain or France. Britain, expecting to suffer most from the American regulations, built up a new South American market for its exports, and the British shipowners were pleased that American competition had been removed by the action of the U.S. government.Jefferson placed himself in a strange position with his Embargo policy. Though he had so frequently and eloquently argued for as little government intervention as possible, he now found himself assuming extraordinary powers in an attempt to enforce his policy. The presidential election of 1808, in which James Madison defeated Charles Cotesworth Pinckney, showed that the Federalists were regaining strength, and helped to convince Jefferson and Madison that the Embargo would have to be removed.
Shortly before leaving office, in March 1809, Jefferson signed the repeal of the failed Embargo. Despite its unpopular nature, the Embargo Act did have some limited, unintended benefits, especially as entrepreneurs and workers responded by bringing in fresh capital and labor into New England textile and other manufacturing industries, lessening America's reliance on the British merchants.
Repealing the legislation
On March 1, 1809, Congress passed the Non-Intercourse Act, a law that enabled the President, once the wars of Europe ended, to declare the country sufficiently safe and to allow foreign trade with certain nations.In 1810 the government was ready to try yet another tactic of economic coercion, in the desperate measure known as Macon's Bill Number 2. This bill became law on May 1, 1810, and replaced the Non-Intercourse Act. It was an acknowledgment of the failure of economic pressure to coerce the European powers. Trade with both Britain and France was now thrown open, and the United States attempted to bargain with the two belligerents. If either power would remove her restrictions on American commerce, the United States would reapply non-intercourse against the power that had not so acted. Napoleon quickly took advantage of this opportunity. He promised that his Berlin and Milan Decrees would be repealed, and Madison reinstated non-intercourse against Britain in the fall of 1810. Though Napoleon did not fulfill his promise, strained Anglo-American relations prevented his being brought to task for his duplicity.
The attempt of Jefferson and Madison to resist aggression by peaceful means gained a belated success in June 1812 when Britain finally promised to repeal their Orders in Council. The British concession was too late, for by the time the news reached America the United States had already declared the War of 1812 against Britain.