Dan Snow's History Hit - Scotland's Disastrous Attempt at Empire

Episode Date: October 8, 2024

In the late 17th century, Scotland tried to establish a colony in Panama - and it all went horribly wrong.In July 1698, a fleet of five ships departed from the Firth of Forth with some 1,200 people onboard. They were bound for the Isthmus of Panama, a paradise in Central America, and their goal was to establish Scotland's first colony - New Caledonia. It was a bold, desperate gamble, intended to save Scotland from financial ruin. But only one year later, most of the settlers were dead, and the colony had been abandoned.To tell us about the Darien scheme and how it all went wrong, we're joined by Douglas Watt, author of 'The Price of Scotland'. He explains what happened when the settlers arrived in Panama and the consequences for Scotland as a whole.Produced by James Hickmann and edited by Dougal Patmore.Enjoy unlimited access to award-winning original documentaries that are released weekly and AD-FREE podcasts. Sign up HERE for 50% off for 3 months using code ‘DANSNOW’.We'd love to hear from you - what do you want to hear an episode on? You can email the podcast at [e-mail] can take part in our listener survey here.

Hi everybody, welcome to Dan Snow's History Hit. The 17th century was a, well, it was a crucible of European empires. These little states on the very, very western edge of Eurasia discovered an extraordinarily potent combination of seafaring, of navigation, of financing, of how to store barrels of hard alcohol, which enabled them to travel across the world, trading, enslaving, conquering, settling, and fighting each other as they went. The Spanish Empire was one of the early leaders. It was still, by the 17th century, an empire on which the sun never set, with possessions right across the Americas and South Asia. The Portuguese were clinging to parts of their empire, but both of those two Iberian empires were under threat from the Dutch, the French and the English,

all growing in ambition through the 17th century. They were trading for spice and luxury goods in Asia. They were taking ships full of enslaved African people and putting them to work in the plantations of the New World to grow cash crops for the European market. But all of those empires have left enormous legacies on the world, demographically, linguistically, culturally today. But they weren't all. There were other European empires in the fray. The Danes controlled parts of the coast of what is now Ghana. Fort Christianburg in modern Accra, for example. They ruled over St. Thomas in the Virgin Islands. The Swedes, for a couple of decades in the 17th century, had an empire in North America. Much of Delaware, New Jersey, Pennsylvania, and Maryland

was New Sweden. Even the Tuscans, the northern Italians, the Tuscans, briefly tried to get in on the action, sending out one imperial expedition to the Americas. And alongside all of those wannabe imperial nations, there were the Scots. For a very brief period, in a place in Central America called Darien, the Scottish founded the colony of New Caledonia. Its capital, New Edinburgh. At the heart of New Edinburgh, the fort, Fort St. Andrew. What could be more Scottish than that? Friends, I say for a brief period because the Darien scheme, as it's known, was a catastrophe, a disaster. And that's what we're

talking about on the podcast today. Scotland's short-lived empire. A fascinating story, an important economic story. A tragic personal story for everyone caught up in it. An enormously important story in the histories of England and Scotland. A story that helped lead to the act of union between the English and Scots and the birth of the British Empire, which would become the largest the world has ever known, with full, in fact, disproportionate Scottish participation.

It's a remarkable story, folks. It's a story of national pride, of horrific corporate mismanagement, of blaming the English for all your woes, and also for the rich getting their money back in a huge government bailout. Some of it might be familiar. Here to tell me all about it is Douglas Watt. He's got a PhD in history from Edinburgh University. He has written The Price of Scotland, Darien Union and the Wealth of Nations.

A prize-winning story of this Darien disaster. Enjoy. T-minus 10. Atomic bomb dropped on Hiroshima. God save the king. No black-white unity till there is first and black unity. Never to go to war with one another again. And liftoff, and the shuttle has cleared the tower.

Douglas, thanks so much for coming on the podcast. My pleasure. First of all, where is Darian? Thanks so much for coming on the podcast. My pleasure. First of all, where is Darien? Well, Darien is in present-day Panama, on the isthmus of Central America,

fairly near Colombia. And even today, it's just basically a virgin jungle. There's nothing really there. There's no major settlements, as the Scots had hoped to create one back in the late 17th century. And who on earth sold the Scottish people that barren stretch of land that even today hasn't been very developed? I mean, that does say something about its potential back in the 17th century.

Yeah, indeed. Well, a very gifted salesman called William Paterson, who's fairly well known as being one of the founders of the Bank of England. And his real gift was that as a salesperson, he sold shares to investors. But he also sold this idea of a trading emporium, a trading entrepot at Darien in Central America. He sold this idea to a majority of the directors of the Company of Scotland. And the idea was that if the Scots could establish a colony at Darien, it would act as a magnet for trade and capital in the Caribbean, and also potentially link the Atlantic with the Pacific Ocean,

and enable the Scots to control trade out to the East Indies. Ambitious. It's very ambitious. Let's step back a second and talk about the sense of things at the time in the late 17th century. Why would Scotland have imperial ambitions? What was going on amongst its neighbours? Were there empires being sent out by all of these Northwest European countries? I think most of them were trying to do so. I mean, basically, the company of Scotland trading to Africa and the Indies, as it's called, there was no mention of Darien in the name.

The company was established to emulate and compete with the English East India Company and the Dutch East India Company, which had both made huge profits over the previous century. And the feeling was if Scotland could establish a company, raise capital, establish colonies, this could obviously boost the Scottish economy and develop Scotland as a nation. So that's the key point. There's an economic driver here. They can see how much cash the Dutch and the English are making in particular. But is there a strategic idea here? Is it about hard power as well and boosting Scotland's prominence in this pretty crowded neighbourhood? I mean, I think there was, but it was quite naive on the side

of the Scots who had a very rudimentary navy that they could you know control a colony in the Caribbean where they were competing with the English and Dutch which had significant naval power so I think it was an idea that perhaps sounded good on paper or when you heard William Patterson describe it to you in a tavern or coffee house but the reality was kind of far from this. And so the idea is you establish a foothold. It's a place where ships can go and be safe during hurricane season and there's a port there. But also it's on the narrowest part of the Isthmus of Panama. So yes, you can try and control those important mule trains that take trade east-west across that scrap of land. Yeah, that's exactly right. But the slight snag was it

was bang in the middle of the Spanish imperial economy. Well, that's my next question. Didn't Spain lay claim to that entire region? And wasn't the silver of the Andes coming up that west coast South America across Panama and then off to Europe? It was. And the Spanish had arrived in Dari in about 200 years before the Scots. They had settlements fairly close by at Portobello, Panama City and Cartagena. But the Scots basically bet that the Spanish empire was in decline. And this was a major risk they took. And the reality was that there were still large amounts of silver, as you were saying, being shipped across the Isthmus back to Spain. And the Spanish were just not willing to see a Scottish president's right bang in the front of their influence. So it's William Pattinson's idea. Had he been there?

Had he just looked at it on a map and thought it'd be a good place? Literally, who came up with the idea? There's no evidence that he'd ever been there at all. He was a merchant who'd spent time in the Caribbean, and he'd probably talked to many other merchants, pirates who'd maybe been to the Isthmus. And this idea gradually formed in his mind. He tried to sell it to other people over the years, but failed. He probably backed up with maps and calculations, etc. But it was fairly risky. And it wasn't really based on any firm evidence. And yet, he found investors. I suppose that tells you something about stock market bubbles. There are periods in which it's easier to raise money than others. And I suppose these people in Scotland looked out at England, they looked across the North Sea to Holland and elsewhere, and they thought,

there's money to be made here. How hard can it be? If the English are doing it, those useless idiots, then surely we can as well. Exactly. But the interesting thing is the company was set up and raised money before Darien was really mentioned. If you look at the name of the company in Scotland trading to Africa and the Indies, it was initially envisaged as a global trading company that would compete across the world. For various reasons during the company's history, the vast majority of the capital is allocated to this one almost crazy project around Darien. It sucks up all the money, it fails, and every penny of the capital of the company is lost. Okay, well, hang on, let's not get ahead of ourselves here. Let's

talk about the joint stock company, because it's another feature of the late 17th century. It's a recognizably modern enterprise, isn't it? You buy shares, do you? It is, yeah. It's basically the ancestor of the PLC. The Company of Scotland was established by active parliament, so it had legal backing of the Scottish Parliament. It first of all tried to raise money in London, which was obviously the most liquid capital market in the world at that point. There was opposition from the English East India Company, and they had to abandon that attempt. They then go back to Edinburgh and Glasgow, and they raise money from a large number of Scottish investors who probably are partly stimulated by the kind of opposition

that appeared in London. It was a kind of national effort, as well as the kind of economic reasons of hoping to benefit from, you know, the dividends that would ultimately be paid out by the Company of Scotland. Right, because the East India Company, which has a monopoly on all trade east of Cape of Good Hope, so any trade with the so-called Indies and South Asia, Southeast Asia, China, the East India Company, a complete monopoly on that trade. So this new company wouldn't be able to break into that. And that would have looked like bullying. That would have looked like a classic case of the English telling the Scots where to go. That's right. And of course, the Scottish company was based on an act of parliament, which had been passed or accepted by their king,

King William, who was also the king of England. So there was that issue that was William favouring his English realm over his Scottish realm, which he obviously was, given the power differential between the wealth that's been created in London compared to what was being created in Edinburgh. And yet he did give his assent to this Act of Scottish Parliament, which is that the Company of Scotland could be set up. He did. I think he argued later that he hadn't realised the powers that were being given to it. And he was misled by some of his Scottish ministers, but that was maybe convenient.

Yeah, very convenient. Okay, so you've got all of these people from across Scottish society, they want to get a piece of this, I guess this new, you can understand this new exciting maritime world, people living in this extraordinarily dynamic maritime economy that they can see going on elsewhere. And you do get a case of it left people dangerously exposed. I mean, it did soak up a lot of the available capital in Scotland, did it? I think it sucked up a large amount. Yeah, it's possibly being exaggerated how much, it's difficult to gauge because there weren't really any economic figures around at the time. how much. It's difficult to gauge because there weren't really any economic figures around at the time. But certainly it was large enough to have a major, major both economic and political impact

if it failed. I mean, if the company had raised £10,000 sterling, it would have been a success and it could have sent a number of ships out to India or to Caribbean. But the company actually raised £400,000 sterling, which was a surprisingly large amount for what was perceived as a relatively poor northern European nation. So that the capital raising of the charities and boroughs that invested, pooled their capital to invest as institutional investors in the Company of Scotland. Okay, so the first expedition set sail in the summer of 1698. As you point out, the original ambition, which might have been to go to West Africa and entrap enslaved Africans and transport them to the Caribbean or to go round the Cape of entrap enslaved Africans and transport them to the

Caribbean or to go round the Cape of Good Hope and bring back spices. That seems now to have fallen into the shade. What's the big mission for 1698? The big mission is to send ships out to Darien to establish a colony and to make it a magnet for trade, first of all within the Caribbean, but the Scots were hoping that Barbados and Jamaica, these English colonies and other Spanish colonies, would trade with the Darien colony and gradually it would develop and the Scots would benefit from this. Were they hoping to find any sort of raw materials in Darien?

Were there any cash crops or was it just this trade across the Isthmus of Panama they were hoping to find? There were also arguments around resources, particularly gold, which there were rumours circulated that there were a number of gold mines quite close to the Darien colony, which never really materialised, unfortunately, for the Scots. And, of course, they would be able to exploit potentially wood, Nicaragua. Wood was quite a valuable resource.

So there was other backups if you like and potentially it could have become a center for the trading of slaves which would be another factor so you've got 1200 people on board these five ships what kind of people are these are they women and children along or are they a kind of tough slightly more male skewing bunch of buccaneers on the the first expedition, they're mostly male. On the second expedition, there were a hundred women. There are some children, mostly ships, boys who were working on the ships, but they were a mixture of soldiers, laird sons, even a couple of noble sons, notaries, anyone who wanted a bit of adventure and wanted to explore the Caribbean.

And they sail straight into some hideous conditions in the North Atlantic. The first mistake probably is sailing from the east coast of Scotland from the Firth of Forth. So they have to sail north round the Scottish coast, round beside Orkney and Shetland. And they have problems sailing down south towards Madeira. So it's not a particularly successful journey. It takes a bit of time, and quite a large number of people die before they even reach Darien. If you listen to Dan Snow's history,

we're talking about the Scottish Empire all coming up. We're talking about the Normans. Kings and popes. Who were rarely the best of friends. Murder. Rebellions. And crusades. Find out who we really were by subscribing to Gone Medieval from History Hit. Wherever you get your podcasts. So a horrific journey out.

Talk about going the long way around. That's brutal. What happens when they get there? I mean, do we have accounts? Were they reasonably surprised when they saw what was waiting for them? There's plenty of contemporary accounts because letters and journals were sent back via other ships,

which eventually got back to scotland so initially there was incredible euphoria they arrived in darien it was an amazing beautiful place very much contrasting perhaps with the scottish scenery you can imagine palm trees you know lots of fish in the sea they began to build their settlement called it new edinburgh their defensive structure was Fort St Andrew. New Caledonia was the colony. So initially they were very positive. They had achieved this dream of empire that the Scots had been trying to achieve.

So the initial messages back to Edinburgh were very positive, but gradually that kind of reality begins to change. Although it would have been very pleasant, it is fully in the malarial belt and there are all sorts of tropical diseases which they would have had no concept of and no idea how to deal with. That's right. And the Scots begin to die in droves very quickly

within weeks of landing at Darien. Many succumb, you know, hundreds die from diseases. William Patterson himself falls ill with one of the tropical diseases and his wife, who had travelled out with him, actually passes away at Derry and so she's buried out there. So yeah, a number of Scots died before the actual second expedition had arrived. I'm glad Paterson actually went.

He put his body on the line. That says more than some of these guys who stir up all this speculation. He did, but there's another story there that hasn't really been told. There was a major financial scandal before the fleet set sail for Darien, which involved the loss of about 10% of the capital of the company.

One of Patterson's business associates basically lost the money. It kind of looks like from the company records that Patterson went out to kind of restore his reputation and his reputation had been badly damaged. And he basically said, said well I'll go out myself and I'll prove that this thing will actually work for us. The other bizarre thing is that despite the failure of the colony when Paterson comes back home to Scotland eventually he survives and he's willing to blame

everyone apart from himself and his crazy idea. Okay, interesting. So the natural world is, well, pleasant looking, but contains hidden dangers. What about the Spanish? Well, the Spanish, I think, are quite surprised that the Scots have suddenly appeared in Darien. And initially, there's a couple of small skirmishes with the Spanish. I should say, the first expedition, which reached Darien because of disease and hunger and lack of provisions coming from Scotland had to abandon the colony before there was any major attack from the Spanish. And it was the second expedition that arrived after the first group had left that then faced a Spanish onslaught and were forced to surrender to the Spanish. If that hadn't worked, the Spanish were actually preparing a major armada to sail from Spain to crush the Scottish colony. So they basically

decided they were going to destroy the Scots, whatever. What about the English? You mentioned that William III, it's an unusual period in British history, which is that England and Scotland have the same monarch, but are still two distinct kingdoms. Because the English were there in the Caribbean as well. Were they any help at all? Well, the Scots had expected them to be a help, I think, and had expected they could trade with Jamaica and Barbados. But the English government decided to issue orders saying that no trade was to be done with the Scottish colony.

Because in essence, the Scots were interfering with the balance of power in Europe and any kind of King William's interfering with the balance of power in Europe and any kind of King William's ideas of that balance of power so the colony actually received opposition from the English which was a major source of anger for the Scots. So the Spanish are attacking it, the English are refusing to help at best, they're basically deeply hostile. What's going on within the colony? is that second expedition any more successful or do they perish in great numbers as well the second expedition follows exactly the same course as the first they arrive although they're initially surprised that

the site has been abandoned so they arrive at an empty colony very quickly they're hit by disease again and hunger lack of provisions kicks in and there's no more support coming from Scotland. So you've basically got a kind of impoverished, disease-ridden colony facing major Spanish opposition and they make this decision to abandon and leave Darién to the Spanish. And they then go back on their ships and sail back north across the Caribbean.

I think at that stage, hundreds more die from disease on that journey back across the Caribbean. So we've got the second expedition has arrived. These new settlers are also lethally vulnerable to disease. And the Spanish are now on site, are they? They're trying to take back control of the colony. They are. There's more Spanish presence. There is what's been portrayed as a positive, a skirmish at a place called Tubacanti between some of the Scots and the Spanish the Scots were led by Alexander Campbell of FNAB and the Scots are actually victorious in this small-scale skirmish news of this actually goes back to Scotland and is celebrated back

back in Scotland as a major victory but I think it's been exaggerated it was really just a very kind of you know small-scale fight but basically the Spanish had superior numbers superior arms and the Scots over the medium to long term couldn't oppose them. And so the Spanish have what they built a stockade or a fort there and so that there's now two nations trying to occupy the same piece of land. Yeah they're basically there's a face-off the Scots have a position at Fort St Andrew they're trying to protect it the limited defences they've managed to build over the previous year. And I think they recognise that if the Spanish launch a full-scale attack, they will be slaughtered.

So best to come to terms with the Spanish, which the Spanish were agreed to do, and let the Scots leave peacefully on their ships. So in all, between those two voyages, approximately how many Scottish settlers headed out for Darien? I think in total we worked out maybe about two and a half thousand went out on the various ships to Darien. And how many people came back? I think about 1800 died so that's a large proportion. Many more ended up in Jamaica or even New York. So I think those who came back was probably a small minority, maybe dozens or a hundred or so.

So when news arrives that the Scottish have finally surrendered this colony to the Spanish, what is the effect in Scotland? Back in Scotland, there's just huge anger and despair, really. I mean, both from the point of view of all the money being lost, but also the national prestige has been hit, and the issue becomes a political hot potato. And the parliamentary session of the Scottish Parliament, 1700-1701, is described as the angriest in history. There really is just intense, intense anger. And who's that anger directed against? As we might expect, a blame game develops after this major event.

And some people blame the directors of the company for basically a major corporate cock-up of the First Order and, you know, a very badly managed one. But the directors quite skillfully direct opposition onto the English government to become a convenient target for them to politicise the issue. And quite strangely, the Company of Scotland, or what's left of it, there's very little money, but the office of the Company of Scotland in Edinburgh is used as a kind of propaganda centre to issue propaganda to try and beat up the English government and stoke up the political anger in Scotland. So the anger on the streets of Scotland about the failure of this exhibition, this project, directs a lot towards the English. How much blame should the English get? Whose fault was this?

In my opinion, it was a corporate cock-up on a grand scale. And the major people who were responsible for it were the directors of the Company of Scotland, who pursued a very, very high risk strategy, using up most of the company's capital, and basically betted that the Spanish wouldn't crush the colony. They should have been aware, and indeed, they were already aware of English opposition because of the attempt to raise capital in London in late 1695. So they knew the English were against the venture. But despite all the risks, despite spending huge amounts on ships, etc.,

they risked everything on Paterson's Darien scheme, which was really pregnant with its own potential for disaster. And sadly, everything that could have gone wrong went wrong. The English government are quite useful to try and deflect some of the anger towards the directors, I guess, because people have lost a lot of money. And is there a wider economic impact in Scotland? Does it lead to a more general economic crisis? I mean, I think there was an economic impact and a lot of savings were lost. I think it's maybe been over-exaggerated. The Scottish economy was badly hit by agricultural problems from 1695 onwards, the so-called 7L years. I think that was the major driver of economic problems.

Daring obviously exaggerated that, and it certainly was negative. But there's some signs that by the early 18th century, the Scottish economy was actually improving. And if you look at, for example, the share price of the Bank of Scotland during this period, it's actually going up from about 1699 onwards. So it would suggest that there is this major economic problem in the 1690s, but perhaps bizarrely, by the time Darien becomes a major political issue, the Scottish economy is actually improving somewhat. Okay, so the effects, it's often said traditionally that it somehow bankrupted

Scotland and Scots had no choice but to jump into a union with England. But you think actually that traditional telling is not quite right? I would argue that would be wrong. There is a close connection between the Company of Scotland and union in 1767, but it's quite a nuanced one. And actually, the shareholders of the company who had lost a lot of money provided a convenient mechanism of reward for the English government to provide quite large amounts of money to a particular group of Scots to achieve union. So if you like, Darien is like the key that unpicks this very difficult political attempt to achieve an incorporating union between Scotland and England, which had failed in the past. So hang on, so what does the English government do? It says we will, what, reimburse,

or we will do a bailout for people that lost their money on the Darien scheme, as long as you guys vote for union with England? Basically, a large lump sum called the equivalent is a key factor of the Treaty of Union. About 60% of that money is earmarked for the shareholders of the Company of Scotland. But the sum is only to be paid if the treaty is passed through the Scottish Parliament. So quite a large number of Scots, I've estimated maybe about four and a half thousand Scots, would receive and did receive quite large payments from the equivalent. And this was obviously a public payment. It wasn't a secret bribe.

There was evidence of secret bribery at the same time, which was much smaller in amount. This large lump sum of the equivalent, which was called the Price of Scotland by Jacobites, of the equivalent, which was called the Price of Scotland by Jacobites, was seen as the key sweetener to get quite an unpopular treaty through the Scottish Parliament. So some people were effectively persuaded, well, bought off. Were there others who either it hardened their opposition to the English because they felt the English had betrayed the Scots and it pushed them into the hands of the Jacobites, the Stuart family who claimed the thrones of England and Scotland. And by contrast, were there also people who said, look, if we want to realise our imperial and trading aspirations, we're better off doing it within a united kingdom of England and Scotland together?

There was a big debate at the time, you know, a huge amount of pamphlets were published, There was a big debate at the time. A huge amount of pamphlets were published, people debating the economic pros and cons of union and other issues about religion and the formation of a common Protestant union. They were all factors. And I think those factors had been there before. And the notion which was quite powerful

that the Scots and English could combine together to develop an imperial future, they were factors. It just seems that the largeness of this payment was pretty much crucial to getting that treaty through at the end of the day. Okay, so the failure of the Darien scheme did help pave the way for the Union of England and Scotland, although not entirely as it's traditionally been portrayed. Yeah, I would certainly argue that. What's interesting is the actual anger around Dari and the political stushy, if you like, had burnt out by maybe 1701-2. So that kind of anger had already spent.

And it's only maybe four or five years later that the shareholders who had expected to have lost everything were suddenly being offered the prospect of not just all their money back, but payments which included interest payments as if their money had been invested in a kind of, you know, gilt-edge bond rather than the company of Scotland that had destroyed all their capital. So it was in many ways quite a generous payment by the English government. And obviously at that time time England was at war the decision was made they were willing to pay up if you like to achieve union and the equivalent was the price they were willing to pay the fact that the treaty went through the

Scottish Parliament there was opposition but it did go through suggest that the price was about right so if you like you can view union as a financial transaction between the two elites, between the Scottish and English elite. And basically, the equivalent was ultimately the price of Scotland. I'm really shocked to hear that the elite who gambled everything and lost and sent loads of people to their deaths in hideous tropical climes. I'm shocked to hear that they got bailed out and actually ended up making money out of the whole thing. It is. It's a stunning, unbelievable story. Who'd have thought it? Who'd have thought that that was the case? I think that's a story we've

seen time and again over centuries. From the English point of view, do you think Darien played any part in the English desire to have a union with Scotland? Were there concerns that a Scottish empire, Scottish maritime strength might be something that was best absorbed, headed off at the pass, absorbed into English strength and into a union before it became tricky? I'm sure it would have been a factor because, as you mentioned, the Jacobite threat was present. There was even concern that the Scottish Parliament could choose a different successor to the English Hanoverian succession. So Scotland was a problem.

So if the Parliament could be snuffed out and Scotland could be brought into a common imperial project, then that made strategic political sense from the English point of view. So it's a fascinating moment in history with enormous consequence as well. Thank you very much, Douglas, for coming on. What's your book called? The book's called The Price of Scotland, Darien, Union and the Wealth of Nations. That's great. Go and get everyone. Thank you very much for coming on.

Yeah, my pleasure. you