At the time of the conquest the colony of New Netherland was occupied by Dutch farmers and traders on western Long Island and on both sides of the Hudson as far north as the Mohawk River; central Long Island was inhabited in part by New Englanders; the eastern end entirely so. To establish English authority in the province, harmonizing at once the interests of the Catholic Duke of York, the Dutch Protestants, and the New England Puritans, was a difficult task, but it was accomplished with much skill by Colonel Nicolls, who was the first English governor. Religious toleration was granted; land titles were confirmed; and a body of laws, known as the Duke's Laws, based upon Dutch custom and New England statutes, was prepared by the governor and with some murmuring accepted by the inhabitants. In 1683 Governor Dongan, yielding to popular demand, established a legislative body consisting of the governor's council and a house of eighteen deputies elected by the freeholders, and the freemen of the corporations of Albany and New York. With the accession of James as King of England, the province temporarily lost its popular assembly; in 1688 it was annexed to New England under the jurisdiction of Andros; and after the Revolution it was distracted for many years by political quarrels growing out of the Leisler Rebellion. Yet none of these events interfered with the economic development of the colony. In 1674 the population was about 7000. Natural increase, together with immigrants from England and New England, Huguenot exiles from France, and refugees which the armies of Louis XIV drove out of the Palatinate, swelled the number to about 25,000 in 1700. Dutch merchants at Albany did a thriving business in furs; and in 1695 New York City, with a population of 5000, was already the center of an active trade, mainly West Indian, by no means wholly legal, in provisions and sugar.

The conquest of New Amsterdam was scarcely completed before the Duke of York, by "lease and re-lease," and for the sum of ten shillings, conveyed to his friends, Lord Berkeley and Sir George Carteret, the territory between the Hudson and the Delaware Rivers, afterwards known as New Jersey. Dutch settlers already occupied the west shore of New York Harbor; and there were Swedes as well as Dutch on the lower Delaware. Favorable concessions offered by the proprietors soon attracted New Englanders from Long Island and Connecticut, who located in the region of Monmouth and Middletown. The proprietors nevertheless found more vexation than profit in their venture; and in 1673 Lord Berkeley sold his rights to two Friends, John Fenwick and Edward Byllinge, who were intent upon founding a refuge for the Quakers in America. Many Quakers soon settled in West Jersey along the Delaware, and upon the death of Carteret the proprietary rights to East Jersey were purchased by William Penn and other Friends who had succeeded to the rights of Fenwick and Byllinge. A mixed population and conflicting claims made the history of the first Quaker colony a turbulent one. In 1688 both Jerseys were annexed to New York; and in 1702, the proprietors having surrendered all their rights, the two colonies became the single royal province of New Jersey.

Of those who were interested in securing a refuge for the Quakers, the most active was William Penn, who had suffered ridicule and persecution for his faith, and who now desired a clearer field than the Jerseys offered for his political and religious experiments. In 1681 he therefore procured from the king a proprietary grant of the territory lying west of the Delaware from "twelve miles north of New Castle Town unto the three and fortieth degree of Northern Latitude." The land within these vague limits was thought to be "wholly Indian," and the purposes of Penn did not run counter to the colonial policy of the Government. Optimism or ignorance disposed the Lords of Trade to believe that Pennsylvania could as readily as the Carolinas be devoted to the cultivation of "oyle, dates, figgs, almons, raisins, and currans." To the political hobbies of Penn the Government was indifferent, while the intractable Quakers were classed with jailbirds and political offenders as people who were more useful to England in the plantations than at home. The proprietor's "Account of the Province of Pennsylvania," translated into Dutch, German, and French, promising religious and political liberty, and offering land on easy terms to rich and poor alike, attracted good colonists in large numbers. Within ten years there were 10,000 people, mostly Quakers, in Pennsylvania and the Delaware counties. Political wrangling, somewhat difficult to understand and scarcely worth unraveling, distracted the colony of brotherly love for many years; but from the beginning the province prospered. The settlers were as thrifty as New England Puritans, and they had better soil and a more hospitable climate. Provisions were soon raised for export; and in 1700, according to Robert Quarry, the Quakers of Pennsylvania had "improved tillage to that degree that they have made bread, flower, and Beer a drugg in all the markets of the West Indies."

II

As early as 1656 London merchants were inquiring "whether it would not be a prudentiall thing to draw all the Islands, Colonies, and Dominions of America under one and the same management here." Enterprising capitalists who had ventured their money in Jamaica or Barbados were content to leave the honor and profit of founding new colonies to idealists like Penn and Shaftesbury; but they eagerly welcomed the restored monarch after the unsettled conditions of 1659, and were prepared, even before he landed, to tell him "how the forraigne plantations may be made most useful to the Trade and Navigation of these Kingdomes." Of all the busy promoters whose private interests were, by some strange whim of Providence, in such happy accord with the nation's welfare and the theories of economists, none was more conspicuous than Martin Noel. He was a man of varied activities: a stockholder in the East India Company; a farmer of the inland post office and of the excise; a banker who made loans, and issued bills of exchange and letters of credit. His many ships traded in the West Indies, in New England and Virginia, and in the Mediterranean. During the wars of the Protectorate he was himself a commissioner of prize goods, issued letters of marque, and judged the prizes taken by his own vessels. A center of great interest was his place at the Old Jewry; the resort of ship captains, merchants, investors, contractors, officials of the Government. The capital for financing one of the Jamaica expeditions was raised there by Noel, who was rewarded by a grant of twenty thousand acres of sugar land after the conquest of the island. He had been intimate with Cromwell, and after the return of Charles won the reputation of being, in all affairs of trade and plantations, "the mainstay of the Government." It was through Martin Noel, and men of his kind, that the old colonial system began to be shaped to serve the ends of the moneyed and mercantile interests of England.

Areas settled by 1660, and between 1660 and 1700

Enterprising men like Noel were prosperous enough, but their extended vision enabled them to complain intelligently of the decay of trade. In the year 1660 exports made not more than a fourth part of the eight and a half millions of England's foreign commerce. Money was scarce, interest high, rents and prices low. No one doubted that the effective remedy for these ills lay in establishing a "favorable balance of trade." But in the path of this achievement stood the old rivals of England—Holland, Spain, and France. Imports from France overbalanced exports thither in the proportion of 2.6 to 1.6. Spain still worked the rich silver veins of the Andes, and the conquest of Jamaica had opened English eyes to the high value of her West Indian possessions. Above all, the thrifty Dutch, intrenched in the East Indies and on the west coast of Africa, supplied Europe with the major part of Oriental products and denied England's right to share with them the honor and profit of importing slaves into Spanish America. To restore the balance of the French trade, and to contest with Holland and Spain for the lucrative commerce of the East and the West Indies was the underlying economic motive of the wars and diplomacy, as well as of the colonial policy of the Restoration period; it was for this that the Royal African and Hudson Bay Companies were organized; for this the Dutch and French wars were waged; for this regulations were enacted for trade and plantations. And to contemporaries the wisdom of such measures was evident in the result: at the close of the century, although imports remained approximately the same as in 1660, exports had reached the unprecedented figure of seven millions sterling.

In achieving this result, the plantations were expected to play an important part; and no one doubted that they had done so. During the decade after the Restoration, the commerce between England and her American possessions was about one tenth of her total foreign trade; in 1700 it was about one seventh. Imports from the colonies rose from £500,000 to more than £1,000,000, and exports to the colonies from £105,910 to £750,000. But the mere increase of trade was no perfect index of the importance of the plantations; for the colonial trade built up the merchant marine far more, in proportion to its volume, than any other. The American voyages were long; plantation commodities bulked large in proportion to their value; and whereas much of the commerce between England and Europe was carried in foreign ships, colonial trade was confined to British vessels. If, therefore, the merchant marine more than doubled during the Restoration, that happy result was thought to be largely due to the colonies. "The Plantacion trade is one of the greatest nurseries of the Shipping and Seamen of this Kingdome, and one of the greatest branches of its trade," said the customs commissioners in 1678; "the Plantacions, New Castle trade, and the fisheries, make 3/4 of all the seamen in ye Nation."

The colonies which enlisted the enthusiasm of the commissioners were the plantations proper. There were men, such as Charles Davenant, who thought New England might have its uses; but the high value of Maryland and Virginia, of Barbados and Jamaica, was obvious to all. Maryland and Virginia, it is true, were not quite ideal colonies, since it was found necessary, in their interest, to prohibit the raising of tobacco in England. But the sugar islands were without reproach. England was not now, as in the time of James I, thought to be overpopulated; and Barbados and Jamaica found favor, not only because their products were neither raised nor made in England, but because they could be exploited by slave labor. It was pointed out that happily "by taking off one useless person, for such generally go abroad [to the islands], we add Twenty Blacks to the Labour and Manufactures of the Nation." Negroes procured in Africa at slight cost might, indeed, be counted as commodities of export, while the island colonies cultivated precisely those commodities which England would otherwise have imported from foreign countries. And the statistics of the custom-house confirmed the theory of the pamphleteer; in 1697, seven eighths of all colonial commerce was with the tobacco and sugar plantations, and Jamaica alone offered a greater market than all the Northern and Middle colonies combined.