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Speculation and the Spanish Crisis

THE nineteenth century had a different relationship towards coffee from that which had respectively obtained in the two preceding centuries.

Whereas the seventeenth century valued coffee for the most part as a medicament, as a quickener of the circulation and as an anti-Bacchic remedy, the eighteenth century looked upon it as an intellectual stimulant. Coffee, said Montesquieu, sometimes enables very stupid people to do clever things.

The attitude of the nineteenth century was a much more comprehensive one. For it, coffee was primarily, secondarily, and all the time an energizer. The nineteenth century was the epoch of unparallelled achievement. The industrial era, in great measure inaugurated by the Continental System and continuing to flourish abundantly when that system had been overthrown, demanded, in theory at least, a twenty-four-hour working day. This could only be realized through the aid of coffee, which was therefore consumed freely by the masses. During the nineteenth century, the working-classes drank coffee. Coffee, often very badly prepared, was a prerequisite to the activity of factories and workshops.

Indeed, during the nineteenth century, coffee began to show a new visage. It speciously presented itself as competent “to solve the social problem.” It came to be regarded as the antagonist of hunger. During the dispute which those who imported coffee into Europe carried on for so long against the high tariff imposed upon this staple, it was again and again declared that: “Coffee is a popular nutrient, and must therefore not be highly taxed.” From the medical standpoint, the statement is false. Coffee has no nutritive value whatever, and one who should try to live upon it would soon starve to death. Sociologically considered, however, there was something to be said for the argument. Coffee produces a fallacious sense that hunger has been satisfied. It “helps people to bear scarcity of food.” Coffee alleviates the pangs of hunger. Napoleon was one of the first men of note who recognized the widespread importance of coffee in war-time. Throughout the nineteenth century, coffee was “the soldiers’ drink.” A beleaguered fortress in which there was no coffee was foredoomed to destruction just as if there had been a shortage of ammunition. During the war of 1914–1918, the beleaguered fortress of Germany became painfully aware of this.

Coffee, then, though not a nutrient, is valuable, nay indispensable, to the worker as an energizer of the labour process. As soon as this became recognized, it was natural that coffee should be one of the chief pawns in the game of financial speculation, which loves to play with the necessities of life, or with articles that are believed to be such.

Coffee had become one of the necessities of life!

In the years when the Continental System was in force, and when no coffee could be imported, such small quantities as were in store or could be smuggled in commanded fantastic prices. Throughout the nineteenth century, the memory of this remained alive in the minds of speculators, who were aware that, given certain conditions, a fortune could be made out of coffee. Its price on the exchanges depended upon the relation between supply and demand. Prices soared in times of scarcity.

A good example of jiggery-pokery in such matters, of the way in which speculators turned passing political conditions to account, is furnished by the remarkable story of the tension between France and Spain in the year 1823.

At the beginning of this year, war was imminent in western Europe. Why? The Spaniards, a strange people, prone to swift vacillations, sometimes fervent on behalf of the Catholic cause, and sometimes eager for revolution, had, for years, been in an uproar. To begin with, inspired by their Christian sentiments, they fought against Napoleon, the antichrist of the North. They took up arms on behalf of the pious king, Ferdinand of Bourbon. Yet hardly was Ferdinand back in the country, than they changed their minds. Now they were zealous for the confiscation of ecclesiastical estates, for a declaration of the Rights of Man, for popular liberties, parliamentary government—in a word, for everything that the French revolution, which they had so strenuously resisted, had brought into being northward of the Pyrenees. Now Europe, which had been contemplating Ferdinand and his Spaniards with scornful amusement, was horrified. Was there not something in the wind which recalled the great revolution of 1793? Was the monarch about to be arrested, deposed, perhaps executed? Tsar Alexander was especially concerned. He was farthest away from the seat of disturbance, but had the most sensitive nerves. Alarmed again and again by reports from Metternich, he considered it incumbent upon him to save monarchy in Spain, to fight once more against the revolution, to maintain the legitimist principle, to send a Russian army to Madrid. At the meetings of the monarchs in Troppau, Laibach, and Verona, where intervention in southern Europe (for there were disturbances in Italy as well) was discussed, it was unanimously agreed to suppress the Spanish revolution.

But who could bell the cat? Who was to coerce the Spaniards to good behaviour?

France!

Louis XVIII, and Chateaubriand as well, would seem to have proposed that the French fleur-de-lis, the banner that thirty years before had been contemptuously torn down by the men of the Parisian Terror, should, now that it had been rehoisted, be triumphantly borne to Madrid. What a splendid idea! New France, the France of the restored Bourbons, monarchical and Christian France, was to show herself the supreme champion of legitimism. Besides, Ferdinand VII and Louis XVIII were both Bourbons, and therefore distant cousins. Blood is thicker than water.

The tacit mandate that Russia, Austria, and Prussia conferred upon conquered France eight years after her supreme humiliation, this mission to play the victor in Spain, was pleasing to French national vanity. First of all, on the pretext that Spanish revolutionists were sowing disquiet in southern France, a police cordon was established along the frontier. Then troops were sent to guard the passes, it being alleged that yellow fever prevailed in Spain. More and yet more battalions were dispatched to the south. At length everyone expected war. People were only waiting for the declaration of King Louis XVIII, as soon as he returned from Verona.

The king read the Speech from the Throne on January 28, 1823. It was moderate in form, but the contents signified war. Louis declared that he had done everything he could to make sure that, henceforward, France should not be disturbed by Spanish propaganda. But the folly of Madrid destroyed all hopes of peace. He was compelled, therefore, he said, to recall his ambassador. One hundred thousand Frenchmen, under the command of a prince of the blood royal, were ready, God willing, to maintain monarchy in Spain, and to reconcile that country with Europe.

The Speech from the Throne was accepted by a decisive majority in the Chamber. Shouts were raised: “Long live the King and all the Bourbons!” The ambassadors of the European powers were looking on like gods of destiny. With one exception, the British ambassador! The British government, in which the whig, George Canning, was secretary for foreign affairs, was not inclined to smile at the notion that, only ten years after England had protected Spain against Napoleonic usurpation, Frenchmen, though royalist, should once more conquer Madrid. In contrast with the deputies, the public of Paris, the French populace, showed little enthusiasm. Those who held national securities were dismayed. One hundred francs in the national debt was quoted at seventy-seven, and most other securities fell in proportion. When the names of the generals were announced who, under Angoulême, were to lead the invasion of Spain—some of them were Napoleonic marshals, such as Oudinot—confidence was somewhat restored.

In these circumstances, speculators began to play for a rise in prices, especially in the prices of imports. King Louis XVIII, in his Speech from the Throne, had declared that French naval stations were adequately fortified, and that a number of cruisers had been equipped to protect marine commerce. Among all the rhetorical flourishes in the speech of this obese and undependable man, this seemed the most alarming. Almost as alarming, however, was the next, to the effect that “if war should prove unavoidable, its area will be restricted and its duration shortened as much as possible.” What did that really mean? Perhaps that England was planning to withdraw from any sort of collaboration with the Alliance, Prussia, Russia, Austria, France, and to make common cause with revolutionary Spain? In that case the war might last for a very long time. As early as January 30, mounted couriers were galloping across Europe from exchange to exchange, to Amsterdam, Hamburg, Vienna, St. Petersburg, Berlin, Frankfort-on-Main, and, on the western side of the Channel, to London. “Buy coffee!” was the watchword. “Within a few weeks there will be no more to be had, since the sea-routes will be closed!” Even if there was not to be a naval war between equally matched forces, the danger of privateering was very great. Neither Spanish nor French merchantmen freighted from coffee-growing countries would dare to keep the seas. While there was a general fall in securities, the price of coffee rose rapidly. Large sums were invested in coffee on the exchanges.

But what had become of the presupposition upon which these transactions had been based: the war? After all, there was no war! The faithless Chamber, which had so recently applauded the king, was now listening, with malicious delight, to the speeches of the opposition. Duvergier de Huranne proved that intervention in Spain would be unpatriotic and scandalous. Sebastiani outdid the previous speaker by asking the nation what interest it could have in espousing the cause of the Holy Alliance, the former enemy of France, which had so unexpectedly shown an interest in Spain. Lainé, Lesaigneur, and Cabanon laid stress upon the injury which a war would do to trade. In the upper house, too, there suddenly appeared many adversaries of the war. Talleyrand, now seventy years of age, roused himself out of his apathy to show, with shrewd arguments, that absolutism in Spain was not genuinely legitimist or, rather, was not strictly lawful, since popular councils had already existed in Aragon of old. Napoleon, said the Emperor’s sometime right-hand man, had really ensured his downfall through fighting a war with Spain, and the restored French monarchy would do well to avoid following his example. He himself, Talleyrand, Prince of Benevento, had, in 1809, warned Napoleon against the Spanish adventure. Perhaps King Louis would pay heed to a similar warning now!

This speech, delivered by Talleyrand in his caustic and intentionally tedious manner, produced an immense effect. It seemed barely credible that after hearing such words the Chamber would vote the war credits. On February 25 there was an oratorical duel between Chateaubriand, who belonged to the extreme Right, and Manuel, the leader of the Left Manuel went so far as to rail not only against the advocates of war, but against the Bourbons themselves and Louis XVIII. Until this sitting of the Chamber, coffee speculators had, in fear and trembling, maintained the price of coffee. They had been hoping for a war; but now, exactly four weeks after the king’s Speech from the Throne, they believed that there would be no war.

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WHAT THE ARMY NEEDS MOST . . . provided Prussia should become involved in the Crimean War. (Cartoon, 1855)

Instead of a war, something else came. Coffee! Coffee from all directions! The seas were no longer dangerous, so, during March, trading ships in abundance arrived from America. Supplies of coffee were shipped from Mexico, the Antilles, Jamaica; and the vessels brought news that a huge Brazilian harvest was expected. Prices, which had been artificially sustained, fell with a rush. There were failures in London, Paris, Frankfort, Berlin, and St. Petersburg; a mercantile crash of gigantic proportions led to hundreds of suicides. Millionaires became paupers.

Then, when the earth was still fresh upon the tombs of these victims of speculation, war was, after all, declared between France and Spain. A short, local war, such as the king had predicted. An almost bloodless war, in which the British took no part. On April 7 the Duke of Angoulême’s army crossed the Bidassoa, which, for twelve miles of its course, forms the boundary between France and Spain.

But the victims of the coffee crisis did not hear the martial tramp of the French regiments as these entered Madrid.