Captain Elliot and the Founding of Hong Kong

by Captain Elliot

  The Emperor had been supplied with sharply conflicting views about the opium problem. The belief that pleasure-inducing but harmful drugs are better dealt with by legalisation and control than by criminalising their use is strongly held by many in the modern world. In 1830s Qing China it was espoused by an influential band of high-ranking mandarins and academics of whom the most prominent in this context was Xu Naiqi, who as a criminal judge had had experience of the robbery, blackmail and extortion that were the widespread consequences of prohibition.6 Viceroy Deng supported the legalisation proposals, but strong and persuasive arguments for intensified prohibition reached the Emperor before Deng’s endorsement. These were from two other senior officials, who opposed legalisation for both philosophical and practical reasons and one of whom, Xu Qin, named at some length the foreign traders most involved in opium smuggling, including William Jardine, Lancelot Dent and James Innes. Though the Emperor’s mind was made up before the end of 1836 and instructions were then passed to the Viceroy to investigate with a view to more stringent action, the British community – including Charles Elliot – continued to hope, well into the new year, that legalisation would become a reality.7

  Elliot was well aware that Chinese officials on the China coast derived significant income from the illicit opium trade. In Canton successive holders of the office of Director of Customs (the Hoppo), already men of sufficient means to have purchased the post in the first place, became even more wealthy during the three years of their tenure. The system of ‘squeeze’ was all-pervasive; the Hoppo took a large share of the customs revenue for himself, but had to ensure that members of the Imperial Court in Beijing also had their cut. The same obligation was laid on the Hong merchants, similarly wealthy individuals whose personal income was even more directly dependent on the health of the trade with the barbarians. Unsurprisingly, they viewed with some alarm the rigorous measures against the drug now being pursued by their government. It was in the financial interests of the foreign merchants and the Co-Hong that they should maintain good relations with each other, whatever either party may have felt, but the very low opinion of Chinese officialdom held by the English frequently found a voice. Of the Hoppo the Canton Register, a weekly newspaper published for the foreign merchant community, had been dismissive:

  from him is neither expected nor required the political acumen, the historical knowledge, the practised habits, the civil courage, – and, above all, the honesty of intention of a real statesman. No, let him collect the Imperial duties, and strive to augment them for his own profit by any means however illegal, unjust, oppressive, and extortionate, for his system is even now tottering to its fall; but let him not … interfere with the great questions of free agency and moral right; and more particularly let him avoid meddling in those cases in which Englishmen are concerned in exercising their privileges either of unrestrained thought, or free action.8

  The Register’s strictures about things with which the Hoppo should not concern himself are illustrative not only of the free traders’ mindset towards what they considered Chinese officials’ incapability of understanding such matters, but of their estimation of their own intellectual and moral superiority. The foreign merchants were also comfortable with the trade in opium; it was seen as, and was, the one commodity which the Chinese would accept in exchange for tea, silks and other desirable merchandise, obviating the need for the English to pay in bullion and coin. With copious amounts of Chinese silver also being used as payment for opium, the foreigners made a substantial profit on the trade. If the Chinese chose to abuse the drug and themselves and become addicted, that was their problem. There was even a view that Chinese opium users themselves thought its illegal status essential for maximising supply; according to George Tradescant Lay, who worked for the British and Foreign Bible Society: ‘In China every man is a smuggler in opium from the Emperor downwards…. Opium here is only contraband in the letter. It is an article that bears a duty which, to render as high as possible the traffic, comes in the shape of a prohibition.’9

  Charles Elliot’s personal position on opium was clear and known, and it did nothing to endear him to Jardine, Dent, Innes and the others. The autobiography of his friend Henry Taylor reproduces what Elliot wrote, with his customary sniping about the perceived unimportance of his opinions, two years later:

  If my private feelings were of the least consequence upon questions of a public and important nature, surely, I might justly say, that no man entertains a deeper detestation of the disgrace and sin of this forced traffic on the coast of China … I see little to choose between it and piracy, and in my place as a public officer, I have steadily discountenanced it by all the lawful means in my power, and at the total sacrifice of my private comfort in the society in which I have lived for some years past.10

  Whatever his private thoughts about opium, Elliot could not afford to incur the outright hostility of the traders. They knew this, and they knew that Elliot was also concerned on economic grounds about the danger of relying solely on opium to balance the books. Jardine, protesting far too much, later placed the blame for the illegal opium trade on Chinese local officials, the Chinese government, and the East India Company – on all involved, in other words, except private British merchants like himself (and the British government, whom he did not wish to antagonise).11 He was right in one respect, that responsibility for opium smuggling was not exclusive to one party. A Tory-leaning periodical, Blackwood’s Edinburgh Magazine, concluded that: ‘The sin of the opium trade, if sin there be, rests not with British merchants, but is divisible, in about equal proportions betwixt the Chinese and British Governments and the East India Company’, and reminded its readers that:

  The East India Company first carried on the trade in opium on their own account. On the discontinuation of the direct export, the drug was still grown on their lands by their tenants on their behalf. They made public sale of it to merchants, well-knowing it was destined for export to China, where almost alone its consumption lay. The British Government and Legislature sanctioned the trade for the sake of revenue, as did the East India Company.12,13

  In the moral argument, the East India Company was an easy target. Since losing its monopoly in 1834 the decline in its influence had gathered pace as British manufacturers had pressed further the case for free trade. In the practicalities of conducting commerce on the China coast in 1838, the British merchants found it expedient to refer, resentfully, to past years in which the Company had enjoyed a financial relationship with the Co-Hong now denied to them. Free trade they espoused in principle, but faced with little prospect of the substantial sums owed to them by the Co-Hong ever being repaid, several sought the intervention of the British government.

  Dent and his co-signatories to a letter sent for this purpose to Palmerston, via Elliot, cannot have had any serious hope of their communication being acted on. They had not involved Elliot in its composition, and some of their more prominent colleagues including Jardine, Matheson and Innes were not party to the initiative. With a hint of threat, they wrote concurrently to the Viceroy pressing the need for alternative (though unspecified) arrangements for resolving the problem of the Hong merchants’ debts, complaining that:

  We bring our property from a great distance to trade with this empire, and we are compelled by its laws to place it in the hands of a few Hong merchants, nominated by the emperor. It cannot be that his majesty intends that they should retain our capital until it has nearly doubled itself by the accumulation of interest, and then pay us back only on the principal.14

  They concluded:

  It seems to us … that some other system is required…. As we do not feel competent to discuss this question with your excellency, we have referred it through her majesty’s chief superintendent to our own gracious sovereign, who will, we humbly hope, communicate upon the subject with your emperor.

  In the meantime we shall gratefully receive any portion of our claims which your excellency may be pleased to order to be paid, a
nd be prepared to listen to the suggestions which the hong merchants may propose.15

  The fact was that as a result of the Chinese measures against opium, business had taken a significant downturn in 1837, and the foreign traders were looking for any means possible to improve their financial position. With Chinese restrictions in Canton and on the approaches to it, Jardine Matheson sought to offload as much opium as possible at locations up the coast, using force if necessary. In the absence of enough ‘fast crabs’ manned by Chinese crews to take opium from the store ships at Lintin up to Canton, many of the leading merchants were now using their own armed boats. Prominent among them was the aggressive and obdurate James Innes.

  Charles Elliot viewed these developments with alarm. His personal antagonism towards the opium trade was well known, but purely practical considerations and the real threat, as he saw it, of a rapid escalation into conflict with the Chinese persuaded him to send Palmerston another request for British intervention. Armed smuggling was now being conducted on a provocative scale which in Elliot’s assessment the Chinese authorities would not be able to ignore. Elliot’s fears proved well-founded; in August and September 1837 the Emperor gave orders that the Chief Superintendent should take steps to ensure both that all receiving ships at Lintin were removed and that the illicit coastal trade ceased. Daoguang’s edict was a clear indication of Chinese misunderstanding of the extent of Elliot’s authority – he might be the Queen’s representative but he had no powers over such unofficial activities, even though they were illegal and their perpetrators were mostly British. To a report sent by Elliot in November, Palmerston responded by repeating his original insistence that there could be no official government action either in support of, or to restrain, British opium traffickers.

  In Britain, the government and Parliament had begun to take notice of the anxious communications from the Chief Superintendent and his compatriots on the China coast. They were not particularly worried about opium smuggling; their concerns centred on the reports they received of the alleged maltreatment of British subjects by a foreign power in a distant country. Perceived insult to the British flag was guaranteed to inflame the patriotic indignation of the man or woman in the street, and the press made sure that the several specific instances of unacceptable Chinese behaviour of recent decades were kept at the forefront of public consciousness.16 In a letter in September 1837 to Lord Minto, a first cousin of Charles Elliot and at that time first Lord of the Admiralty, Palmerston was cautiously optimistic about Elliot’s ability to handle the situation. He now considered that the Royal Navy could play a useful role:

  Elliot is now at Canton by the sanction of the Chinese Govt. and I hope our trade there will go on well. But it is very desirable that some good sized Ship of war should be, as much as possible, on the China Station, both to inspire the Chinese with Respect and to keep the Crews of our Merchant Men in order.17

  Palmerston had miscalculated its potential effect, but in July 1838 the naval presence Elliot had asked for in February the previous year materialised. There were three ships: the 74-gun ship-of-the-line HMS Wellesley, flagship of Rear-Admiral Sir Frederick Maitland, commander-in-chief of the East India station; HMS Larne, an 18-gun sloop; and HMS Algerine, a 10-gun brig-sloop.

  If the British expectation was that the squadron should simply be noted quietly by the Chinese as a reminder of who held naval superiority, it failed. The Chinese were quickly alarmed; but a note requiring an explanation from the British was returned unread because it was labelled a ‘command’, and Elliot’s letter to the Viceroy a few days later, explaining that the purpose of the ships was entirely peaceful, was similarly returned because it was not labelled a ‘petition’. The situation was then exacerbated when the Chinese fired on an unarmed British vessel they suspected of carrying opium and/or Rear Admiral Maitland up to Canton. The British ships advanced to the Bogue, and it took an eventual meeting between Chinese and British naval officers on board the Wellesley to clear the air. After mutual reassurance and courteous exchanges, the British squadron sailed away in early October (though HMS Larne remained in the region, moving to a position up the coast).

  Since 2 December 1837 Charles Elliot had been with his family at Macao. The events arising from the arrival of Maitland’s ships had necessitated a visit to Canton, for which he departed on 25 July. Doubtless exasperated at the continuing Chinese obsession with forms of address, he returned to Macao after a few days.

  The months Elliot spent at Macao in 1838 gave him some time in which to reflect.18 He was reasonably confident that he would be able to establish a workable relationship with the Chinese authorities, but well understood the volatility of the situation. He began to be concerned for the safety of his family – his wife Clara, their children Harriet and Hughie, and the recent addition Frederick, born in October 1837. Clara too may have felt some unease; she was aware that her husband’s empathy with the Chinese caused many in the merchant community on the China coast to regard him with suspicion. She wrote to her sister-in-law early in 1838 reporting that Charles intended to send her home with the children in November. Aware (perhaps with a tinge of irritation) of the extent to which he confided in his sister, she continued: ‘Charles of course tells you of his public doings and if he did not I should seem to meddle with them. He is a favourite among the Chinese but much too good. Charles declares his [own] manners and ways are really ridiculously the same as theirs.’19 Elliot himself was worried about the children’s education, telling Emma that ‘My chicks here are pretty and manageable, but they need better instruction than we have the means of giving them.’20

  Whatever domestic plans were then half-forming in his mind, in the closing weeks of the year Elliot was wholly preoccupied with yet another serious confrontation between the foreign merchants and the Chinese authorities. Since the Viceroy and his local officials could not themselves prevent opium from reaching the population of Canton, they had decided that its consumption could be discouraged by severely punishing the addicts as well as the dealers. Instances of public strangulation had had the intended effect on trade, but not just the opium trade – the harshness of the crackdown was beginning to blight all aspects of commerce. Three episodes in December quickly raised the temperature: a blatantly provocative attempt to unload opium for James Innes at the Factories, and a defiant reaction by Innes when told to leave; word of an intended execution of an opium dealer in the square in front of the Factories, in full view of all; and though that spectacle was prevented, a riot involving aggrieved merchants and large numbers of bystanding Cantonese.

  Elliot was at Whampoa when he was called to Canton. After sending a formal protest to the Viceroy about the behaviour of the local citizenry, he summoned a meeting of the merchants. Focused as always on his primary duty to protect the interests of British trade, he now had no hesitation in adopting a more conciliatory policy towards the Viceroy, nor in telling the merchants why. A cooperative approach held the best hope of protecting trade; indeed without it a prolonged cessation was entirely likely. On a personal level, it would serve to make up some of the ground in Anglo-Chinese relations lost through the Maitland visit, which the Viceroy was convinced Elliot had contrived with aggression in mind. Joint action against the drug trade would also, of course, chime well with Elliot’s personal hostility to the traffic in opium and the extensive British involvement in it.

  He followed up the meeting, at which he made it clear that he ascribed the present turbulence to opium smuggling, with a written notice to the opium merchants informing them that they should forthwith withdraw their vessels at least as far as the Bogue; if they refused, he would not take any protective action were they to be attacked by the Chinese. By the end of December the opium boats had gone, but from Elliot’s viewpoint it was equally if not more important that the Viceroy had responded positively when hearing of his initiative. Early in the new year normal commerce resumed.

  Elliot could be forgiven for thinking at this stage that he was at last st
arting to make genuine progress in his efforts to normalise relations and build lasting foundations for the development of commerce between Britain and China. He remained realistic nevertheless. In January 1839 he set out for Palmerston – in his usual lengthy prose – his concerns about the opium trade and where it might lead:

  It had been clear to me, my Lord, from the origin of this peculiar branch of the opium traffic, that it must be more and more mischievous to every branch of the trade, and certainly to none more than to that of opium itself. As the danger and shame of its pursuit increased, it was obvious that it would fall by rapid degrees into the hands of more and more desperate men; that it would stain the foreign character with constantly aggravating disgrace, in the sight of the whole of the better portion of this people; and lastly that it would connect itself more and more intimately with our lawful commercial intercourse, to the great peril of vast public and private interests. Till the other day, my Lord, I believe there was no part of the world where the foreigner felt his life and property more secure than here in Canton; but the grave events of 12 ultimo [the intended execution and the riots at the Factories] have left behind a different impression…. In the meantime, however, there has been no relaxation of the vigour of the Government, directed not only against the introduction of the opium, but in a far more remarkable manner against the consumers. A corresponding degree of desperate adventure on the part of the smugglers is only a necessary consequence; and in this situation of things, serious accidents and sudden and indefinite interruptions to the regular trade, must always be probable events.21