When English knights and merchants set out to establish colonies in the New World, two familiar institutions were convenient to the purpose—the proprietary feudal grant, and the chartered trading company; noblemen ambitious for personal dominion turned naturally to the former, while merchants intent upon profits turned as naturally to the latter. The first hapless ventures in American planting, dominated by the idealistic and militant temper of the Elizabethan age, were initiated and directed in the spirit of the gentleman adventurer: in the spirit of Sir Humphrey Gilbert, who identified America with the fabled Atlantis and lost his life in a pathetic attempt to establish an English colony in Newfoundland; in the spirit of Sir Walter Raleigh, whose famous lost colony, settled in the year 1587, exhausted his fortune and disappeared at last, leaving no trace. These men were less interested in profit than in reputation; less intent upon commercial expansion than on the extension of the queen's dominions. But their resources were too limited, their ideals too little practical for the realization of their dreams. The patents to Gilbert and Raleigh took the form of a grant of lordship by feudal tenure; and from the papers left by the former we can create again, even to details, his vision of a transformed wilderness, America's future state: an America of extensive proprietary domains; an America reproducing, in its lords and landed gentry surrounded by freeholder and tenant, in its counties and boroughs and parishes, the social and political aristocracy of old England.
The proprietary feudal grant was destined to play its part in the colonization of America, but the resplendent vision of Gilbert did not survive the reign of Elizabeth. Raleigh was the last of the great Elizabethan adventurers, and with the accession of the pedantic James I the New World was beginning to be regarded in the dry light of a commercial opportunity. To the knights and merchants who had witnessed the vain efforts of Gilbert and Raleigh, the chartered company seemed better adapted to their purposes than the proprietary grant. The methods that had proved fortunate in the Old World would doubtless prove equally so in the New; and in the year 1609, men who were already netting one hundred per cent profit from their investments in the India Company were prepared to venture something in a solid business scheme to exploit the resources of America.
A tentative scheme, failing for want of efficient organization, had already been set on foot. Three years earlier, in 1606, James had been induced to license sundry of his loving subjects "to deduce and conduct two several colonies or plantations in America." Among those active in the undertaking were Bartholomew Gosnold, recently returned from a Western voyage, Richard Hakluyt, Sir Thomas Gates, Sir George Somers, and Edward Maria Wingfield, a London merchant. Though not incorporated, the patentees were formed into two companies, the London Company, so called because its members were mainly London merchants, and the Plymouth Company, consisting mainly of merchants from Plymouth and the west of England. Each company was permitted to establish one colony having a jurisdiction one hundred miles along the coast and one hundred miles inland; the London Company anywhere between 34° and 41°, the Plymouth Company anywhere between 38° and 45°, north latitude; provided only that no colony should be located within one hundred miles of one already established. The patent provided that there should be in each colony, for managing its affairs, a resident council of thirteen members which was to take instructions from the Royal Council for Virginia, a body of fourteen men—afterwards enlarged—residing in England and appointed and controlled by the king. The patentees were permitted to trade freely within the limits designated by the grant, and to enjoy the customs dues exacted from other Englishmen and from foreigners who might wish to compete with them.
After a single vain attempt to establish a colony at Sagadahoc, the Plymouth Company confined its activities to trade and exploration within the region to which John Smith in 1614 gave the name of New England. Sir Fernando Gorges was one of the patentees actively interested in these ventures; and in 1620 he procured, for himself and associates to the number of forty, a charter which transformed the old company into a close corporation under the title of the New England Council or Corporation for New England. Upon the patentees the charter conferred the sole right to trade, to grant title to land, and to establish and govern colonies within the region between 40° and 48°, north latitude, in America. The New England Council possessed neither the capital nor the popular support necessary for engaging in colonizing ventures; and during the fifteen years of its existence it did little but sublet to others the rights which it possessed. Of the council's land grants, of which there were many both to individuals and to corporations, and which, often conflicting, furnished the grounds for innumerable future disputes, four only are important as the basis of permanent colonies in New England. The territory at Plymouth was granted to the Pilgrims in 1621; in 1628 the territory between the Merrimac and the Charles Rivers was conveyed to the Company of Massachusetts Bay; and two grants made in 1629, of territory between the Merrimac and the Piscataqua to John Mason, of territory between the Piscataqua and the Kennebec to Fernando Gorges, mark the beginnings of the colonies of New Hampshire and Maine. All its ventures profited the New England Council nothing. February 3, 1635, the territory within its jurisdiction was parceled out among the patentees, and on June 7, its charter of fruitless privileges was surrendered.
It was reserved for the London Company to begin the planting of the first American commonwealth; but it was by happy chances rather than by wise foresight in the promoters that the colony outlived the company. The first comers, who were set down at Jamestown in 1607, would soon have perished but for the harsh good sense of the redoubtable Captain John Smith; and two years' experience with the wilderness and the Indian, with dissensions among settlers and councillors, demonstrated that the patent was unsuited to the purposes for which it had been granted. More colonists were needed in the colony, more capital required to transport and maintain them, more authority to direct and control them. To meet these needs, a charter was obtained in 1609 which created an incorporated joint-stock company under the title of "The Treasurer and Company of Adventurers and Planters of the City of London for the First Colony of Virginia." Shares were offered for subscription, to be paid for in money by the adventurers who remained in England, and in personal service by the planters who went to the colony. Each shareholder, whether adventurer or planter, was a member of the company, and was to receive such dividends as his shares might earn. The undertaking was widely advertised; and when the charter passed the seals, shares had been subscribed by 659 individuals, including 21 peers, 96 knights, 58 gentlemen, 110 merchants, and 282 citizens, and by 56 of the companies of the City of London.
The affairs of the new company were to be managed by a treasurer and council, resident in England, and appointed and controlled by the freemen assembled in general court. The little colony in Virginia was but an adjunct to the company, and its management was left, without other than conventional and perfunctory restrictions, to the treasurer and council, subject to the approval of the freemen. The first treasurer was Sir Thomas Smythe, who was also the first president of the East India Company, a great merchant in his day, whose influence in Virginia was a predominant one until he was succeeded as treasurer by Edwin Sandys in 1618. Smythe and his associates were little interested in the transmission of English institutions to the New World. They did not regard Virginia, as the historian is apt to do, in the interesting light of an experiment in constitutional liberalism, or conceive of the company as the mother of nations. Their object was to pay dividends to the shareholders, and the colonist was expected to exploit the resources of Virginia for the benefit of the company of which he was a member. Virginia was in fact a plantation owned by the company; its settlers were the company's servants, freely transported in its vessels, fed and housed at its expense, the product of their labor at its disposal for the benefit of all concerned.
With these ideas in mind, and enlightened by past experience, the company appointed Sir Thomas Gates to be "sole and absolute Governor," and sent him out in 1609, together with five hundred settlers in nine ships. Two vessels were wrecked, and what with plague and fever less than half the new colonists ever reached Virginia. The governor was himself stranded on the Bermudas; and when he finally arrived after nine months, sixty starving settlers were found scattered along the James River. Men who had been reduced to eating their dead comrades or the putrid flesh of buried Indians were scarcely good material for regenerating a feeble plantation. Sir Thomas Gates, therefore, decided to abandon the colony. But by a happy chance, as he was sailing with the survivors down the river, he met Lord de la Warr come from England with fresh supplies and new recruits; whereupon he turned back, still hoping to retrieve the desperate fortunes of Virginia.
The decision proved wise in the event. But it was doubtless due to the drastic measures of the company that the misfortunes of previous years were not repeated. The governor returned to England, leaving the colony in the hands of De la Warr, who governed in the spirit of the instructions issued to Gates at the time of his appointment. Popularly known as "Dale's Laws," the regulations under which Virginia was finally made self-supporting were published by Gates after his return in 1611, under the title of "Articles, Laws and Orders, Divine, Politique, and Martial for the Government of Virginia." The new code was based upon the military laws of the Netherlands, and was enforced in the spirit with which the experience of Gates and Dale had made them familiar. From blasphemy to disrespect, from murder to idleness or embezzlement of the common store, the company's servants were liable to meet the knife, the lash, or the gallows at every turn. Until 1618 the régime of martial law was maintained; and the settlers stood guard or marched to the fields at the word of command, scarcely aware, doubtless, that they had been granted all the liberties enjoyed by men "born within this our realm of England."
The military régime which made Virginia self-supporting did not make it prosperous, or profitable to the company. In December, 1618, after an expenditure of £80,000 sterling, there were in the colony "600 persons, men, women and children, and cattle three hundred att the most. And the Company was then lefte in debt neer five thousand pounds." The hard-headed Smythe saw little prospect of the dividends which the shareholders were demanding; and he was ready to give way to any one who still had faith to sink yet more money in the enterprise that for a dozen years had disappointed every expectation. Such an idealist was Sir Edwin Sandys. Son of a Puritan Archbishop of York, he had studied at Oxford under Richard Hooker, whose famous book he had read in manuscript. The Ecclesiastical Polity had perhaps confirmed Sandys in a republican way of thinking; and in the year 1618 he was probably a nonconformist—a "religious gentleman," as Edward Winslow called him: at all events, a man of humanitarian and anti-prerogative instincts; a friend of the Earl of Southampton, and leader of those in the company who were in sympathy with the rising tide of liberal sentiment in English politics.
The liberal policy which Sandys favored in England, he was now prepared to adopt for the management of Virginia. Convinced that the military and joint-stock régime, even if it had ever served a useful purpose, was retarding the development of the colony, Sandys and Southampton determined to reverse the policy of their predecessors by instituting private property in land and conceding a measure of self-government. A popular assembly was accordingly established in 1619; restrictions on conduct and religious opinion were relaxed; and land grants, both to individuals and to corporations, in small and large tracts, were made on easy terms. It was hoped that an appeal to self-respect and to self-interest would encourage immigration and foster thrift and industry. When Sandys became treasurer in 1618 the time seemed propitious; for it had already been discovered that Virginia tobacco could be sold at a profit in London; and it was the expectation of Sandys, by obtaining for the company its fair share of the profit arising from the importation of tobacco into England, to repay to the shareholders the long-delayed interest on their investments.
The scheme was not without great possibilities, and the company spared neither money nor effort to make it a success. Within three years more than thirty-five hundred emigrants crossed to Virginia. In 1621 the expenditures of the company had reached a total of £100,000, and in 1624 the amount had been doubled. Yet, quite apart from the high death-rate which depleted the colony, or the Indian massacre of 1622 which threatened its existence, all the efforts of Sandys ended in failure. Drawn into the main current of English politics, the Virginia Company was unable to live in those troubled waters. James regarded with little favor the liberalism which Sandys and Southampton were promoting in England as well as in America. On high moral grounds he disliked the use of tobacco, and for economic and fiscal reasons was opposed to its cultivation in Virginia. He was determined, at all events, that such profits as might arise from its importation should enrich the royal exchequer rather than a powerful corporation controlled by men who were carping at the king's prerogative. And the king found support in the company itself; for Smythe and Warwick turned against the corporation and furnished pretexts to prove that it had betrayed its trust and should forfeit its rights. In 1624 the charter was accordingly annulled, and Virginia became a royal province.
Thus ended the most serious attempt of a commercial company to make profit out of American planting. Famous and successful in the annals of colonization, it proved a complete disaster as a financial speculation. During the reign of Charles I, merchants were therefore but little disposed to venture their money in enterprises of that kind. Nor was Charles himself, who guarded the royal prerogative more jealously even than James had done, likely to look with favor upon the creation of corporations which would prove useless in case of failure and might prove dangerous if they succeeded. The rough sea of politics in the time of the second Stuart was unsuited to floating successful colonial ventures of any kind under governmental sanction; but in so far as he was disposed to further the development of America, it was natural enough for Charles, who found that his usurping Parliament was backed by the mercantile interest, to frown upon colonial corporations, and to make use of the proprietary feudal grant as a means of rewarding the courtiers and nobles who supported him. The very year that the New England Council surrendered its charter, Archbishop Laud was urging the king to recall that of Massachusetts Bay. It was a few years later that Fernando Gorges was made Lord Proprietor of Maine; a few years earlier that Lord Baltimore, a loyal supporter of the House of Stuart, received a feudal grant after the manner of the Durham Palatinate of that part of Virginia which was to be known as the Province of Maryland.