Quick Take on Bankers and Empire

I just finished reading Peter James Hudson’s Bankers and Empire: How Wall Street Colonized the Caribbean  

Here is John Clegg interviewing Hudson for the Brooklyn Rail.

Here is a New Dawn podcast of Hudson talking to Michael Dawson about the book.

Hudson describes the activities of America’s most important financial firms in the Caribbean during the late nineteenth and early twentieth centuries. I have been looking forward to reading the book because he studies many of the same firms that I have studied in my work on trust companies. (Institutions, Entrepreneurs and American Economic History: How the Farmers Loan and Trust company Shaped the Laws  of Business: 1822-1929; “A Failure of Regulation?: Reinterpreting the Panic of 1907,” Business History Review October 2014; and “Trust Company Failures and Institutional Change in New York, 1875-1925,” Enterprise and Society forthcoming). He is also looking at roughly the same period that I do, but he asks very different questions.

Hudson wants to understand how the actions of these firms in the Caribbean were shaped by the combination of racism and the profit motive.  He writes about racial capitalism, but do not confuse this book book with Baptist and Beckert style New History of Capitalism. They make grand claims and portray their work as the result of intense archival research, but their overblown claims are constructed from a secondary literature that is either misrepresented or concealed, and the archival references are ornamental. Hudson, in contrast, tells a story that is built from the ground up using primary sources. It is a messy story, because that is the story that emerges from the wide array of primary sources that he uses. I thought this quote from the interview with Clegg provided a nice description of my impression of the book:

I think it has helped me to understand that the project of “U.S. imperialism” was contingent, marked by an incomplete hegemony, often notable for its confusion, experimentation, and failure, defined through competing interests, and rarely triumphalist. This is not to say that it didn’t exist—or that its effects in the Caribbean, and elsewhere, were not palpable, bloody, or real. But there was always pushback and, while the U.S. state often served as the intermediary for U.S. capital in the Caribbean, oftentimes government officials tried to be a brake on the activities of banks if they felt they were not in the strategic and economic interests of the state. Before I began this project I don’t think I was aware of the role of law and regulation in mediating the relation between banking and imperialism. More often than not, banking expansion was an attempt to evade, erode, or re-write the federal regulations governing banking activity. 

The bankers in the book both compete and cooperate. They see the potential for profit, but ignorance and prejudice often leave them stumbling around trying to get hold of it. There are profits, but there are also failures. They try to use both U.S. and foreign governments to their advantage, but not always successfully. They see themselves as constrained by the law, while also trying to change the law and take advantage of operating under multiple legal regimes. The book reminded me of the end of E.P. Thompson’s Whigs and Hunters, where he describes sitting in his office, surrounded by piles of papers, trying to figure out what it all meant, because the story he had found did not fit into existing narratives about the role of law.

I’ll admit that the economist in me sometimes wanted a little more about the quantitative significance of the firms’ actions. In addition, although the references to the secondary literature, including business history, are extensive, Hudson does not address more social science oriented history. There has been a lot of recent work on institutions and financial development in history, including Latin America and the Caribbean (especially work by Haber and his students), and I’ll have to give more thought to how Hudson’s story relates to this work.

Those issues aside, however, the book tells an interesting story, and I love Hudson’s commitment to building a stories from the primary sources. Moreover, as someone who has written about the same characters, the stories rang true to me. I have tried to tell very different stories about these firms, but his descriptions of them and the people who ran them sounded like the firms and the people that I found in the sources.