T HE C ONTINENTAL S YSTEM

Marvin R. Zahniser

The continental system was the name given to those measures of Napoleon Bonaparte taken between 1806 and 1812 that were designed to disrupt the export trade of Great Britain and ultimately to bring that country financial ruin and social breakdown. This term likewise refers to Bonaparte's plan to develop the economy of continental Europe, with France to be the main beneficiary.

Although the continental system was formally inaugurated with publication of Napoleon's Berlin Decree in November 1806, its historical antecedents can be traced as far back as the Anglo-French commercial wars that began late in the seventeenth century. The maxims of mercantilist thought nourished the propensity of France and Britain to inaugurate blockades and carry on commercial war. A common argument of the mercantilists stated that trade, shipping, industry, and the world's bullion resources were fixed quantities that could not be significantly increased or decreased by human effort. This concept led inexorably to the conclusion that nations could increase their wealth and power only by depriving other nations of their sources of wealth, such as trade. Commercial wars, therefore, if successfully prosecuted, promised a meaningful augmentation to a nation's wealth and diminution of an enemy's.

Profit was generated, in part, by increasing the volume and value of a nation's exports and in compelling competitors to purchase one's exports on disadvantageous terms while purchasing the least possible amount of the competitor's goods. A favorable balance of trade indicated that a nation's profits and wealth were increasing; this could be gauged by the flow of bullion into the country.

With every nation perceiving that its own advancement could be made only at the expense of others, each country began to pursue trade and tariff policies that differed little in war or peace. War simply stimulated nations such as France and Britain to accept even fewer goods from the enemy while pressing their own exports upon the other by every conceivable device. In addition, it was presumed sound economic policy both in war and peace to protect native industries by appropriately stringent tariff legislation.

A new intensity in these policies shortly followed negotiation of the Anglo-French Commercial Treaty of 1786 (Eden's Treaty). Britain was largely satisfied with the treaty, but it provoked bitter criticism in France. Revolutionary France soon began to drift back to the pre-1786 commercial policies. In 1791 the Constituent Assembly adopted a tariff with rates high enough to indicate the new trend. France finally denounced Eden's Treaty early in 1793, an indication of the growing strain in French-British relations and of French determination to protect their industries against British competition. With the execution of Louis XVI in mid-January and the outbreak of war on 1 February 1793, Britain and France resumed their long-standing attempts to strangle each other economically.

Rigid exclusionist policies of early revolutionary France were slightly eased during the ascendancy of Robespierre; they were, however, adopted and strengthened by the government of the Directory (1795–1799). The notorious decree of 18 January 1798 (29 Nivose, Year VI) laid down the principle that the cargo of a ship would determine its nationality; thus, any vessel carrying goods from Britain or its possessions became subject to confiscation, both ship and cargo. Ships stopping at British ports could not enter French ports. The severity of this measure produced a virtual French self-blockade. Likewise, the Directory supported the Navigation Act, passed by the Convention on 21 September 1793. This act prohibited foreign vessels from importing into France products other than those of their own nation or engaging in the French coastal trade. It is clear that these laws of the revolutionary regimes had essentially the same purpose as their predecessors of the past two hundred years—to damage Britain by excluding British goods and ships and to foster French industry, agriculture, and the merchant marine by protecting them from British, and other, competition.

The harshness of French measures, prompted in part by the disturbing reality that British sea power was annihilating the French merchant marine, was bottling up the French fighting navy, taking possession of French colonies one by one, building an enormous carrying trade, and threatening to control neutral trade to its own advantage. Before 1789 there had been 2,000 French merchantmen; by January 1799 the Directory admitted that not a single merchant ship on the high seas flew the French flag. On the other hand, Britain's merchant marine prospered handsomely during these war years. Between 1793 and 1800 the number of ships under British registry rose from 15,000 to nearly 18,000.

British naval power appeared much less decisive than British mercantile superiority, overmatching the French fighting navy by only a two-to-one ratio. France believed it possible to reduce Britain's naval superiority by rapid shipbuilding and under Bonaparte launched major attempts to do so. French naval expenditures between 1803 and 1806 leaped from a projected triennium total of 240 million francs to more than 400 million francs.

See also B LOCKADES ; E CONOMIC P OLICY AND T HEORY ; N AVAL D IPLOMACY ; N EUTRALITY .