Marks, Robert B. 2007. The Origins of the Modern World: A Global and Ecological Narrative from the
Fifteenth to the Twenty-first Century, 2 nd Edition. Lanham, MD: Rowman & Littlefield Publishers, Inc.
In the late 1700s, after defeating the French in the Seven Years War and after losing their colonies in the newly independent United States, Britain was able to turn its attentions to Asia. Britain was particularly concerned about its trade imbalance with China. The trade imbalance was due to the British appetite for Chinese tea and the lack of a Chinese appetite for British manufactures. All the Chinese wanted was British silver.
Tea
With the rise of factory work and a lengthening of the factory work day, British appetite for tea sharply increased. Tea combined with milk and sugar was a major source of calories for the British working class. Tea imports more than quadrupled between 1760 and 1800. By 1800, the working class spent ten percent of their income on tea and sugar.
From 1760 until 1840, China limited foreign trade to a single port at Guangzhou (Canton). The British tried unsuccessfully to use diplomacy to expand its trade with
China. The emperor sent a letter to King George III saying that “Our Celestial Empire possesses all things in prolific abundance and lacks no products within its borders” (quoted on page 114). At this point, the British were in no position to challenge Chinese power.
Because the trade imbalance and particularly the loss of its silver supply, Britain desperately looked for something that the Chinese would buy. They tried pianos, clocks, raw cotton and woolens. Nothing worked until they found opium.
Opium
An aside: The use of opium dates back at least 10,000 years and was widespread from the Egypt and
Greece into China. It is the sap of a variety of poppy contains compounds that are still widely used in their natural
(e.g., morphine and codeine) and synthetic (e.g, Oxycontin and Percocet) to relieve pain. As another example of the
Columbian Exchange, mixing opium with tobacco and smoking it was introduced to China in the late 1600s.
Recreational use of the drug quickly spread. Alarmed by the social cost of opium abuse, the Chinese government outlawed smoking opium in 1729. The Chinese war on the drug trade was no more successful than its war on trade in general and spawned tremendously profitable smuggling operations as the demand for opium continued to expand in China.
With an eye to the Chinese market, Britain seized control of opium production in the Bengal area in 1773. They increased the market in China by offering new users free pipes and very low initial prices. With the expansion of supply from India, Britain was able to lower prices, which resulted in increased demand in China. Supply was also increased when Americans began importing opium from Turkey.
By 1830, the flow of silver reversed.
Aside: In 1834, the British government zealously took up the
“free trade” religion. The British East India Company, which was a

monopoly granted by the British government, was abolished and private traders were allowed to trade. The private traders were “free trade” advocates who believed that restricting opium trade was tantamount to going against the laws of God. Writing in the early 1800s, David Ricardo, an economist who would become a member of the British
Parliament, wrote that “Under a system of perfectly free commerce each country naturally devotes its capital and labour to such employments as are most beneficial to both. The pursuit of individual advantages is admirably connected with the universal good of the whole . By stimulating industry, and by using most efficaciously the peculiar powers bestowed by nature , it distributes labour most economically, while increasing the general mass of the production it diffuses general benefits, and binds together by one common tie of interest and intercourse the universal society of nations ” (Quoted in The Growth of Economic Thought by William Spiegel, p. 333). Of course,
Ricardo completely ignores the benefits that accrued to Britain as a result of its colonies and its previously zealous protection of its own industries. Now one of the most powerful nations on earth, Britons had the right and the duty to force other regions into following natural law.
British free trade zeal collided with Chinese attempts to come to grip with growing addiction in the country. Hundreds of thousands of Chinese were seriously addicted. Some in China argued that the opium trade
“should be legalized, its trade and distribution regulated by the state, and treatment centers established to wean the addicts from the drug. The other side argued that the drug trade was both immoral and illegal, and that it should be stopped by halting its import and punishing the foreign merchants who trafficked in it” (p. 115). The government adopted the second view and, after years of practically ignoring the trade as Chinese merchants and government officials became wealthy, China took serious action. A special commissioner blockaded foreign merchants in their warehouses and only allowed them to leave when they had surrendered their opium and swore never to engage in the opium trade again. The commissioner destroyed the surrendered opium and then relentlessly tried to wipe out the trade.
Free traders howled in outrage. British opium traders protested. Back in England, cotton textile manufacturers convinced that they could undersell anyone on earth, demanded that China be opened to textile trade.
Queen Victoria sent the British navy to force China open to trade, beginning the first Opium War (1839-1842). The
British navy had a newly designed, relatively small all-iron steam-propelled gunboat, named The Nemesis that had been designed for combat on Asian rivers. The Opium War provided the British an excellent opportunity to test the boat. The boat helped to bring the war to an end in 1842 when it was used to block the intersection of the Grand
Canal and the Yangtze River and to threaten bombardment of Nanjing, the southern capital. The Nemesis was an application of the Industrial Revolution to war, particularly war in Asia.
Another important aspect of the Opium Wars is that the British employed
Indians, known as Sepoys, in their armed forces. This provided critical manpower to the British military efforts here and elsewhere in the greater
Indian ocean basin.
China and Britain signed the Treaty of Nanjing in 1842. The treaty drastically limited Chinese sovereignty. China was forced to cede Hong
Kong, a relatively small peninsula and island near Guangzhou/Canton. China could no longer use protective tariffs, open more ports to Western trade, and to pay $21 million in silver to pay for the losses incurred by the British drug lords. Opium trade itself was not legalized by the Treaty of Nanjing, though opium traders were again able to ply their trade and reap their profits. Opium legalization did not occur until the end of the second opium war (1858-1860).
By that time, the rest of the industrialized world had successfully carved up
China.
The supply of opium for the huge Chinese market came mostly from India, where opium became a major export. This, along with the destruction of the textile industry by cheap British textiles, contributed to the

deindustrialization and ruralization of India. Aside: It was not until 1910 that the Chinese convinced Britain to dismantle the India-China opium connection.
Aside: Once again, let’s look at the graph showing the change in the share of world GDP from 1700 to 1890. The
First Opium War marked the beginning of a century of political and social unrest in China. By 1820, China’s productivity, which had initially expanded, fell sharply. By 1890, it was almost as low as India’s. In 1911, the last of the Qing emperors gave up his throne. China was invaded by Japan, suffered from civil wars, and remained in a state of chaos until after World War II, when the communists took power.
Gunboat Diplomacy in Japan
As mentioned above, Americans were part of the opium trade. A number of fortunes were built on the opium trade as well as Asian trade in general. The United States was interested in making its mark on trade in Asia.
European contact with Japan began in the mid-1500s. The Portuguese were the first, arriving as Japan was torn apart by civil wars between rival warlords. Among the Europeans were Christian missionaries who were able to spread Christianity during those chaotic times.
In 1603, the Tokugawa family gained control of all of Japan. Because of conflicts between Christians and
Buddhists, the Tokugawas banned Christianity in 1635 and closed Japan’s doors to foreign influence. Their 200year rule, known as the Tokugawa Shogunate was the longest peace in Japanese history. Much of what we think of as “traditionally Japanese” developed in this period including the traditional dress, Sumo wrestling, and Kabuki theater.
The peace was essentially breached by the United States. In 1853, Commodore Matthew Perry sailed into
Japan with orders to open its doors to trade. On July 8, he steamed four iron-clad gunboats into Tokyo Bay. He presented Shogunate officials with the text of a proposed commercial and friendship treaty and offered three gifts: a miniature steam railroad, a small telegraph system, and a cannon. These (along with those gunboats) demonstrated
American superiority in transportation, communications, and war. He gave the Japanese a choice: open doors to trade with the west, or risk being torn apart like China. Japan was aware of both the intended symbolism of the gifts and of the situation in China.
Like the Terminator, Perry said that he would be back. He sailed away, giving the Japanese court time to think. He returned with a more powerful fleet the following year. Japan signed a treaty with the United States that guaranteed humane treatment for shipwrecked sailors (the pretext for the mission), that allowed U.S. ships to buy
Japanese coal, and that opened to ports to trade with the United States (the real, “free market” mission).
Japan reacted to the unwanted situation in a fundamentally different way than the Chinese. A group of men came to power intent upon keeping Japan free from the sort of Western interference suffered by the rest of Asia.
They realized the need to learn as much from the west as possible. They sent people to Europe and the United States to learn everything about western science, technology, and political systems as possible. To unify the Japanese people, they re-established the emperor as the center of the government in 1868 and made Shinto the national religion of Japan. The two are intertwined because the emperor’s right to rule is established by the Shinto religion.
Shintos believe that the first Japanese emperor was the grandson of the sun goddess, who sent him to rule the earth.

Japanese emperors, descendants of the first emperor, were divine. (After World War II, the emperor was forced by the United States to renounce any claims to divinity.)
The Japanese attitude may be partly explained by two facts. First, unlike China, Japan had never been a world power. China had witnessed its power diminish markedly within a couple of decades. Second, Japan had long borrowed art and technology from China. (For instance, the Japanese language is not closely related to Chinese languages, but the Japanese alphabet is based on the Chinese alphabet.)
Within four decades, Japan became the first Asian country to industrialize. By 1872, the Japanese operated an imported full-size train between Tokyo and Yokohama – about 20 miles. By 1895, Japan was manufacturing its own locomotives.
Like the west, Japan needed colonies to feed its industries. Japan, a volcanic island chain, has few industrial resources. By 1905, Japan began building its resource base through empire-building. It went to war with
Russia, the largest country on earth and a European power. Russia lost. Japan expanded to the islands to the north and then into Korea and northeast China (where there were reserves of both iron and coal). By 1937, on the eve of
World War II, Japan controlled most of eastern China, Southeast Asia, and northern New Guinea. Japan was firmly established as the first Asian empire of the industrial age.
Blocked by the U.S. in the Pacific, Japan bombed Pearl Harbor on December 7, 1941. By 1945, Japan had lost the war. Its economy was in ruins. Thirty years later, it became one of the original members of the G8—the eight most economically powerful countries in the world.
Gunboat Diplomacy in Burma
Burma is a resource-rich low-latitude country.
The British easily took Burma in the 1880s. They sailed up the Irrawaddy River with gunboats armed with
Maxim Machine Guns. Invented in 1884, this machine gun made Britain’s imperial conquest and control of Asia and Africa much easier. As you might remember, the Gatling gun was used against the Zulus in Africa in 1879. The
Maxim gun was a far more efficient because it was self-feeding and does not require cranking.
Burma was incorporated as a province into British India. Short of local labor, the British imported thousands of Chinese and Indians to work in the logging and mining industries. During the colonial period,
Eurasians (particularly Ango-Indians and Anglo-Burmese) became the most influential community in Burma.
Resentment was widespread. No longer were the Burmese the most powerful people in their own country. The
British in particular showed great disrespect for Burmese traditions. Colonizers refused to take shoes off when visiting Buddhists temples or shrines. Buddhism became the focus of the anti-imperialist movement – as it did during the Vietnam War.
Burma won its independence in 1948. Although Burma was a democracy from 1948 until 1962, it continued to suffer from ethnic conflict. The largest ethnic group within Burma is the Burman people who reside primarily in the river valleys. The dominate the Burmese minorities who tend to come from highland areas. These include the Shans and the Karens. (Even today there are Chinese and Indian minorities in Burma.)
In 1962, a military coup turned Burma into a socialist military dictatorship led by Ne Win. Win economically isolated his country from the rest of the world. Residents of foreign descent, particularly Burmese
Indians, fled to neighboring India. The educated population also emigrated. Having eliminated legal sources of wealth, the government was quickly impoverished and smuggling flourished. In 1988, the United Nations classified
Burma as a “least developed nation.” Later that year, another military coup deposed Ne Win and has held onto power ever since. The military continues to hold onto power, though it is trying to open itself again the rest of the

world. Secretary of State Hillary Clinton will visited Burma on November 30, 2011, the first visit by such a high ranking U.S. official in over a half century.
According to the CIA Factbook, “ Burma, a resource-rich country, suffers from pervasive government controls, inefficient economic policies, corruption, and rural poverty. Despite Burma's emergence as a natural gas exporter, socio-economic conditions have deteriorated under the regime's mismanagement, leaving most of the public in poverty, while military leaders and their business cronies exploit the country's ample natural resources. The transfer of state assets, especially real estate, to cronies and military families in 2010 under the guise of a privatization policy further widened the gap between the economic elite and the public. The economy suffers from serious macroeconomic imbalances - including unpredictable inflation, fiscal deficits, multiple official exchange rates that overvalue the Burmese kyat, a distorted interest rate regime, unreliable statistics, and an inability to reconcile national accounts. Burma's poor investment climate hampers the inflow of foreign investment; in recent years, foreign investors have shied away from nearly every sector except for natural gas, power generation, timber, and mining. The exploitation of natural resources does not benefit the population at large. The business climate is widely perceived as opaque, corrupt, and highly inefficient. Over 60% of the FY 2009-10 budget was allocated to state owned enterprises - most operating at a deficit. The most productive sectors will continue to be in extractive industries - especially oil and gas, mining, and timber - with the latter two causing significant environmental degradation. Other areas, such as manufacturing, tourism and services, struggle in the face of inadequate infrastructure, unpredictable trade policies, neglected health and education systems, and endemic corruption. A major banking crisis in 2003 caused 20 private banks to close; private banks still operate under tight restrictions, limiting the private sector's access to credit. The United States, the European Union, and Canada have imposed financial and economic sanctions on Burma. US sanctions, prohibiting most financial transactions with Burmese entities, impose travel bans on senior Burmese military and civilian leaders and others connected to the ruling regime, and ban imports of Burmese products. These sanctions affected the country's fledgling garment industry, isolated the struggling banking sector, and raised the costs of doing business with Burmese companies, particularly firms tied to Burmese regime leaders. The global crisis of 2008-09 caused exports and domestic consumer demand to drop. Remittances from overseas Burmese workers - who had provided significant financial support for their families - slowed or dried up as jobs were lost and migrant workers returned home. Although the Burmese government has good economic relations with its neighbors, significant improvements in economic governance, the business climate, and the political situation are needed to promote serious foreign investment.”