The Glasgow Tobacco Barons

Ayr Rotary Club was privileged to experience an excellent talk from David Vennard on the Glasgow Tobacco Lords, who were a group of Scottish merchants. In the 18th century they made enormous fortunes by trading in tobacco which was supported by the slave trade. Many became so wealthy that they adopted the lifestyle of aristocrats, lavishing vast sums on great houses and splendid churches.

In 1707, the Treaty of Union between Scotland and England gave Scottish merchants access to the English colonies, especially in North America. Glasgow’s position on the River Clyde, where the westerlies hit Europe as well as in other places like Bristol, Nantes, or Bordeaux, may have been an opportunity for its merchants. The French monarchy, continued David, granted to Glasgow a monopoly in 1747 for the importation of tobacco into French territories. The deepening of the Clyde in 1768 provided a further advantage, because Glasgow ships were built specifically for the Atlantic crossing and were generally bigger than those of other ports.

The tobacco trade was part of broader trade that linked exports of consumer and manufactured goods from Europe with the North American and Caribbean colonies. Operated on plantation economies fuelled by slave labour, these colonies supplied products that found a ready market in Europe. This triangle involved merchants carrying manufactured goods from Europe to West Africa to sell or exchange for slaves which they transported on to America and the Caribbean. On the third leg back to Europe they carried tobacco, rum, cotton, sugar. Using an illustration, David explained how this evil triangle perpetuated.

From 1710, Glasgow became the centre of an economic boom which lasted nearly fifty years. The Tobacco Lords personified this boom and were the nouveau riche of the mid-eighteenth century. Arguably the most successful of these merchants was John Glassford, who entered the tobacco trade in 1750 and had soon acquired a fleet of vessels and many tobacco stores across New England. Celebrated in his lifetime, Glassford was the most extensive ship owner of his generation in Scotland, and one of the four merchants who laid the foundation of the commercial greatness of Glasgow through the tobacco trade.

However explained David, during the 1760s tensions grew between Britain and her American colonies, amongst which were economic stresses arising out of the perceived unfairness of the tobacco trade. The market in tobacco was dominated by the Glasgow merchants who manipulated prices (as the colonists claimed) and caused great distress among Maryland and Virginia planters, who by the time of the outbreak of war had accumulated debts of around £1 million, a huge sum at the time (equivalent to £161 million in 2021). These debts, as much as the taxation imposed by Westminster, were among the colonists’ most bitter grievances. It was this extension of cheap credit that made the Glasgow men different. The English merchants simply sold American tobacco in Europe and took a commission. The Scots bought the crop at pre-arranged prices, and made large (and potentially risky) loans to their customers.

Prior to 1740, Glasgow merchants were responsible for the import of less than 10% of America’s tobacco crop, but by the 1750s Glasgow handled more of the trade than the rest of Britain’s ports combined heavily capitalised, and taking great personal risks, these men made immense fortunes from the “Clockwork Operation” of fast ships coupled with ruthless deal making and the manipulation of credit Maryland and Virginia planters were offered easy credit by the Glaswegian merchants, enabling them to buy European consumer goods and other luxuries before harvest time gave them the ready cash to do so. But when the time came to sell the crop, the indebted growers found themselves forced by the traders to accept low prices for their harvest in order to stave off bankruptcy. At his Mount Vernon plantation, future President of the United States George Washington saw his liabilities swell to nearly £2,000 by the late 1760s (equivalent to £294,928 in 2021). Thomas Jefferson, on the verge of losing his own farm, accused British merchants of unfairly depressing tobacco prices and forcing Virginia farmers to take on unsustainable debt loads. In 1786, he remarked:

David, President Bob and Charlie

A powerful engine for this [mercantile profiteering] was the giving of good prices and credit to the planter till they got him more immersed in debt than he could pay without selling lands or slaves. They then reduced the prices given for his tobacco so that…they never permitted him to clear off his debt.

After the war, few of the enormous debts owed by the colonists would ever be repaid. Despite these setbacks, after the American War of Independence (1775–1783) the Glasgow merchants switched their attention to other profitable parts of the triangular trade, particularly cotton in the British Empire. David concluded by reminding his audience abolitionism of the slave trade had its roots in Scotland.

Charlie Steele gave a worthy vote of thanks