Settling accounts

Frank Bongiorno, The Australian National University

Christopher Lloyd, Jacob Metzer and Richard Sutch (eds) Settler Economies in World History, Leiden and Boston, Brill, 2013 (605 pp). ISBN 9-78900423-264-8 (hardback) RRP $233.99.

Settler colonisation, according to Christopher Lloyd and Jacob Metzer in their wide-ranging introduction to this collection, ‘has been a widespread phenomenon in human history and not confined to any particular era, region or continent’ (p. 1). Settler Economies in World History, however, is little concerned with this longer history of settler colonisation, which Lloyd and Metzer go so far as to suggest might stretch back 3,000 years. Settler economies had their ‘golden age’ during the century between the end of the Napoleonic wars in 1815 and the beginning of the First World War in 1914 (p. 21). Thereafter, they have had to adapt to less propitious circumstances; notably, the Depression of the 1930s, the decline of British financial power, and Britain’s turn to Europe in the aftermath of the Second World War and especially since its first, unsuccessful, attempt to join the European Economic Community (EEC) in 1961. Settler economies have managed this transition with various degrees of success: Canada, very well; Australia, fairly well; and New Zealand, whose standard of living was among the highest in the world in the 1930s, with rather limited success—or at least so Lloyd and Metzer argue. Contributor Tim Rooth adds that the Argentine and South African economies performed miserably in the last quarter of the twentieth century. Clearly, the settler economies have had varied experience in coping with the end of empire and the challenges of a globalisation.

The study of settler economies experienced its own take-off, to borrow from Walt Rostow, in the 1980s. The critical moment was the publication of Donald Denoon’s Settler Capitalism: The Dynamics of Dependent Development in the Southern Hemisphere (1983). Denoon, who studied or worked at universities in Africa, Britain, Papua New Guinea and Australia, brought together in a single ‘analytical framework’ New Zealand, Australia, South Africa, Uruguay, Argentina and Chile (Denoon 1983, p. 15). Previous frames of reference for historians had usually been either imperial or national; no one had ever attempted a study of this kind, and certainly not with such an ambitious breadth. Denoon’s concept of settler capitalism, if not entirely his Marxist-inflected approach to studying it, has exercised a deep influence, and perhaps especially in Australia where the field of Settler Colonial Studies—complete with its own practitioners, specialist journal, vocabulary and theories—has also experienced a ‘take-off’ in recent years.

Denoon’s argument was that these settler economies all practised a variant of the capitalist mode of production that had taken root in Western Europe. Each began a garrison-outpost of a European empire intended to serve primarily military and strategic rather than economic goals. Where colonisers encountered hunters and gatherers, they displaced their mode of production and, in many cases, destroyed the lives of the people themselves through violence, starvation or disease. In cases where Indigenous people practised agriculture, they would be transformed first into peasants and later into labourers; in short, they were quickly assimilated to the capitalist mode of production. Pastoralism, rather than agriculture, dominated settler capitalist hinterlands, as ever larger numbers of settlers occupied territory. Land was plentiful; labour, often, was not. In an age of rapidly improving transport and expanding capitalism, nineteenth century settler societies were able to achieve economic prosperity, territorial expansion and a measure of autonomy. Yet their economies remained dependent on a single export staple, or a narrow range of commodities—as a result, they were reliant on Britain, which was the dominant power of the day, the main market for their goods, and the source of most of their investment capital. It did not need to exercise a direct control over them to influence how they behaved. Local societies were often precocious institutional innovators, but only in ways that were consistent with an overall strategy of dependent development that reinforced the link with Britain.

The study of settler economies experienced its own take-off in the 1980s.

This new collection of essays, Settler Economies in World History, builds on Denoon’s earlier work, even bringing together some of the same kinds of comparisons that formed such a refreshing feature of Settler Capitalism. But this study extends the view beyond the Antipodes to the United States, Canada and, less predictably, to Jewish colonisation of Mandatory Palestine, Japanese migration in the Pacific, Mormon settlements in the American West and the black American colonisation of Liberia. (In a deeply ironic turn of the settler colonial wheel, the descendants of American slaves in Liberia performed the role that was elsewhere assumed by white colonisers, becoming for Indigenous people in that country a resented foreign imposition).

Many of the chapters are essentially case studies, sometimes using a comparative method. The claim that the Australian and Argentine economies were on ‘parallel paths’ was a particular favourite of Antipodean doomsayers in the 1980s (Duncan & Fogarty 1984) but Christopher Lloyd (one of the editors of this book, and an Australian scholar based at the University of New England) points out in this collection how Australia saw the political defeat of its landed oligarchy, the squatters, by the mid-nineteenth century, whereas in Argentina ‘frontier oligarchs’ remained dominant (p. 17, pp. 560–563). This very different balance of class forces would have significant consequences for Argentine political and economic development through to the present. Jorge Álvarez and Luis Bértola, in more detail than Lloyd, explain why the economic trajectories of New Zealand and Uruguay are so similar, and yet also very different. New Zealand has always done better economically but the gap between the two countries increased in the course of the twentieth century because of a heavier concentration of land ownership in Uruguay, the greater extraction of rent by its landowners, the New Zealand state’s successful efforts through science to improve the productivity of pastoral land, New Zealand’s better access to British markets, and its stronger record in attracting migrants and educating its people. Both countries, however, have declined in their economic performance since the 1930s, calling into question the tendency of some Uruguayans to look to New Zealand as a model for their own economic development.

Other comparisons are more narrowly based on a particular economic theme. In a chapter by Grietjie Verhoef, there is an account of how the banking system of South Africa differed from that of Australia under the impact of gold-mining; South Africa’s banking sector became more concentrated, dominated by a small number of large institutions, whereas the earlier gold rushes in eastern Australia had a produced a proliferation of banks. The failure of Australian financial institutions in the 1890s encouraged the state to play a more significant role in banking and in the provision of rural credit, whereas South African banks ‘remained characteristically privately owned and managed’ (p. 415).

Many of the chapters are essentially case studies, sometimes using a comparative method.

These kinds of comparisons figure in several chapters, although they sometimes seem rather uncertainly integrated into the larger purposes of the book. As Verhoef remarks, settler capitalist banking was indistinguishable from banking in other kinds of communities. How, then, does the historical detail contained in a chapter such as this one bear on our understanding of the distinctive features of settler capitalism? Perhaps the point here is that settler capitalism could allow considerable variation in the structure of banking between societies, so long as they maintained financial dependence on the City of London—although South Africa, of course, was unique among the settler capitalist societies in that direct British military power would ultimately be deployed in the second Anglo-Boer War to maintain an imperial ascendancy. Financial dependence, it should be noted, was by no means confined to formal colonies in which settlers owed allegiance to Her Majesty, Queen Victoria. The president of Uruguay in 1890 thought his position like that of ‘the manager of a great ranch, whose board of directors is in London’ (p. 393).

How historically useful is the idea of settler colonisation? Certainly, several of the chapters suggest that such societies have enough in common to give rise to generalisations about how and why such neo-Europes developed as they did, and why migrants were attracted to them. Susan B. Carter and Richard Sutch point to natural resource abundance, favourable social, legal, political and economic institutions for exploiting it, government policies focused on growth, and educational opportunities that promised to make sharing in that growth a possibility for all. Perhaps one needs also to add the largely irrational exuberance and gambling spirit that James Belich underlines as one of the powerful impulses behind the ‘explosive colonisation’ of the Anglo world (2009). There are also suggestions in some of the essays collected here that societies where there was greater equality and homogeneity among the settler population—invariably those where family farming gained a foothold—were likely to give rise to economies and institutions (such as an education system) capable of generating ‘sustained economic growth’ (p. 83). Where there was greater inequality, and access to economic opportunities was narrow—as occurred in several Latin American countries, where large amounts of land, Indigenous labour and other resources were awarded to a small elite—the pathway to growth and diversification appears to have been a more troubled one. Economic performance and the standard of living tended to be lower.

The displacement from the land of Indigenous people was a common feature of settler economic experience. A chapter by Frank Tough and Kathleen Dimmer explores in some detail the process by which settler societies in the United States, Canada and New Zealand created ‘counterfeit Individual rights for Indigenous people’ (p. 245), providing them with formal allotments of land under systems which allowed widespread fraud resulting in most of it ending up in the hands of settlers. As one realtor commented to a US Senatorial Committee in 1906, ‘First provide the land for the home seekers … and in this process the Indians will find their own level’ (p. 223). But in another chapter, Tony Ward’s picture of the Maoris’ situation is a little less bleak. Although they lost a great deal of land, they were brought into contact with markets and able to continue aspects of their traditional lives. In Australia and South Africa, of course, settlers simply took the land from Indigenous people without even bothering to establish legal processes that could be manipulated in their own favour.

How historically useful is the idea of settler colonisation?

The book is not without its weaknesses. There is a large number of misprints, some bordering on the comical (or libellous, perhaps, if you happen to be Donald Denoon, whose surname on page 416 is given as ‘Demon’). Comparative and transnational histories also draw scholars outside the areas of their greatest expertise, which can lead to the kind of elementary error found in the chapter of a New Zealand specialist who claims, incorrectly, that ‘Indigenous Australians were denied the suffrage until 1967’ (p. 523). There is also occasionally a deterministic character to the argument—an economic historian’s resolve to find an economic explanation for phenomena even where there is no obvious basis for doing so. Hence we learn from Stanley L. Engerman and Kenneth L. Sokoloff that Australia was one of a number of settler countries that sought ‘primarily white labor’ because ‘they were unable to pay the high prices for slaves’ that resulted from demand in ‘tropical colonies’ (p. 80). But where is the evidence that it was the price mechanism that led to an absence of slavery from British settler societies such as Australia? Didn’t the development of anti-slavery sentiment in Britain have any impact? Arthur Phillip, the first governor of New South Wales, remarked that ‘there can be no slavery in a free land, and consequently no slaves’ (Coleman 2005, p. 167). This doesn’t sound to me like a reflection on the price of slaves on the international market. David Meredith, by way of contrast, suggests with greater plausibility that the availability of convict labour in Australia tipped ‘the balance between seizure of land and acquisition of Indigenous labour strongly in favour of the former’ (p. 333); again, though, it is unclear whether we are talking here about causation as such, or something rather more elusive: was there really a ‘balance’ to be tipped? Perhaps the point is that if New South Wales had been established as a different kind of colony, possibly for a strategic reason alone and without the presence of unfree convict labour, some kind of solution to the labour problem would need to have been sought, and it would probably have involved using Indigenous people. Meredith points out that the high land to labour ratios faced by Europeans necessitated a solution in the case of each settler economy, but the precise nature of that solution varied according to circumstances. In colonial South America, for instance, colonists coerced Indigenous people into providing labour but ‘the dramatic decline in native populations’ led to the importation of slaves. In South Africa, one solution to the labour problem was to close off the access of Indigenous people to land; another was coercive legislation that restricted freedom of movement and criminalised breaches of contract.

Several scholars see breaks or moments in the twentieth century history of the settler economies that signified a drawing of the curtain on a critical phase in their histories. Bernard Attard argues that the Depression of 1930–31 ‘marked the final passing of the conjuncture that had favored export-led growth in European migrant societies since Britain’s adoption of free trade during the 1840s’ (p. 397). Attard calls these Wakefieldian societies, based on the application of British capital and labour to abundant land in the interests of profit and colonial expansion. Other scholars represented in the collection use a similar periodisation in charting the rise and fall of the settler economy, while varying the detail slightly, depending on their focus or approach. In the area of trade, for instance, Francine McKenzie suggests that Canada’s settler era had effectively ended as early as 1920, as its economy became more closely tied to that of the United States. For Australia, the ‘settlement era’ in trade lasted until the 1960s—in the 1930s and 1940s, Australia clung closely to Britain through its participation in the sterling bloc—whereas for New Zealand, which managed to gain some concessions over dairy exports even when Britain joined the EEC in 1973, the settler era arguably lasted a little longer again. Jim McAloon argues that in the 1940s, Australia and New Zealand experienced ‘a clear break with the status quo’, with the shift to Keynesian management and policies that had a ‘strong affinity with European social democracy’ (p. 529, 531). Some, however, might be inclined to see more continuity here, a resilient attachment to what Francis Castles (1985) called the ‘wage earner’s welfare state’ with its emphasis on the protection of the family through support of the male breadwinner. And the same Labor governments which supported the Keynesian welfare state remained committed to sterling and imperial preference, and suspicious of US free trade prescriptions.

There has been in recent years a convergence in the experience of the old settler economies.

One of the strengths of this book—or at least of some of its best essays—is that they are attentive to the contemporary relevance and resonance of their observations. In one of the book’s most lucid chapters, Tim Rooth warns of a number of dangers associated with the settler economies. One is excessive dependence on a single export commodity, such as Australia’s on wool for many decades. Another is excessive reliance on foreign capital, a problem both Australia and Canada have now been successful in countering. A third danger is dependence on a single market. Australia was fortunate in that by the time Britain turned decisively to Europe in the 1960s, a minerals boom had begun and Australia was developing its trade with countries other than Britain such as Japan. As a result, it was less vulnerable than New Zealand to the reorientation of British commerce. But Australia’s growing dependence on the Chinese export market now raises somewhat comparable problems to those faced by settler economies, including Australia’s own, in the past. And as Rooth points out, currency appreciation driven partly by high commodity prices has caused difficulty for both Australia and Canada in the area of manufacturing exports. Here is perhaps a legacy of the settler economy, or even in Australia’s case, a kind of recrudescence: a return to overwhelming dependence on the export of raw materials to feed industrialisation happening elsewhere.

Christopher Lloyd suggests at the end of this book that there has been in recent years a convergence in the experience of the old settler economies. The Latin American countries have shifted from authoritarian and military rule to democratic forms of government centred on ‘the reactivation of their public sector’ (p. 575). Interestingly, the old Anglo settler societies have also moved towards an emphasis on the building of public infrastructure and public spending, especially in the wake of the Global Financial Crisis. The significance of this shift seems perhaps a little less clear now then when Lloyd made these observations, presumably in 2012. Nonetheless, the thought that we are witnessing convergences between the old Anglo and Latin American settler economies—the possible emergence of a post-settler ‘weak form of social democracy’ (p. 576)—is a provocative one. Advocates of development in settler societies assumed that in the process of industrialisation, they would become more like the mature economies of Europe. It would surely be ironic if, long after the retreat of the European empires that gave them birth, they instead came more closely to resemble one another.


Belich, J. 2009, Replenishing the Earth: The Settler Revolution and the Rise of the Anglo-world, 1783–1939, Oxford University Press, Oxford.

Castles, F.G. 1985, The Working Class and Welfare: Reflections on the Political Development of the Welfare State in Australia and New Zealand, 1890–1980, Allen & Unwin in association with Port Nicholson Press, Wellington and Sydney.

Coleman, D. 2005, Romantic Colonization and British Anti-Slavery, Cambridge University Press, Cambridge.

Denoon, D. 1983, Settler Capitalism: The Dynamics of Dependent Development in the Southern Hemisphere, Oxford University Press, Oxford.

Duncan, T. & Fogarty, J. 1984, Australia and Argentina: On Parallel Paths, Melbourne University Press, Carlton.

Frank Bongiorno is Associate Professor in History at the Australian National University and co-editor of History Australia.

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