2nd Earl Grey’s diary

All editions of the Canton Register for the month of October 1832 are missing from the copy at the Centre for Research Libraries.

They coincide with a visit to China of the British Prime Minister, the 2^nd Earl Grey, on a quest for information in prospect of the renewal of the Company’s charter in 1834. He must have left on this visit immediately he knew the Reform Bill would pass as the period between its passage and Grey’s first interview in China, having stayed briefly with Governor-General Bentinck in Calcutta, was slightly less than six months. He stayed in China for two months and then returned direct to London.

I learned of this visit completely by accident whilst perusing an inventory of the Grey papers in the archives of the University of Durham. As this was a unique event until recently, and as Grey’s notes denote the deliberations of a mature political mind on the Canton situation, I have made a full record of his interviews with various commercial personalities in the China-trade to somewhat replace the missing editions of the newspaper:^[1]

Mr Charles Millett,^[2]Tues 23^rd October

Asked Millet about the Great Fire in 1822. It began in a cook’s shop more than a mile from the factory. The Company lost £500,000 (I was told by others that the Hong merchants paid for the rebuilding of the factory which is not the Company’s property). Half the loss was in woollen cloth. The same year the Prince Regent was lost at Manila with a cargo of woollens. Millet says the Chinese paid no compensation for their losses, certainly not to the Company.

Query – how did the Company pay their dividend and the interest on their Bond Debt the following year? I should check the 1822/23 and 1823/24 P&L accounts. Did they reckon this loss into the prime cost of the tea? If not, upon what principle do they reckon in the losses on their exports? See the evidence 1830.

I regret that I have not kept a journal of my conversations at Macau with Mr Charles Millet who has been twenty years a member of the factory.

“Experience sufficiently proved to us that composure and a firm and decisive tone have more influence with the Chinese than condescension and too much eagerness. The lower class of people in China are very arrogant towards strangers, but when a steady resolution is opposed to them, they yield and even become humble.”

It is remarkable how universal this impression is as may be seen from what is stated of other conversations – I asked the following people, (who were) in China 1820 / 21:

• The Reverend Charles Gutzlaff, a German missionary
• Mr Nathaniel Alexander, a Calcutta merchant
• Mr Thomas Richardson Colledge, the assistant Surgeon of the factory
• Thomas Beale an old resident at Macau, formerly a partner in M/s Shank and Beale and later in the Magniac firm
• Capt Thomas Rees, Master of the Lord Amherst which was freighted by the factory and sent to the northern ports of China with Mr H H Lindsay, the Secretary of the factory, on board
• Capt Clifton of the Red Rover, a Calcutta clipper.^[3]

Mr Millet is strongly impressed with a notion of the impolicy of the present submissive proceedings. He says the Chinese must be bullied – if you don’t bully them, they will bully you – and he predicts that they will make encroachments this year in consequence of our having given way: but that there is scarcely anything which they would not yield if firmly pressed.

He thinks that if we had an island, all the trade might be conducted there without any English going to Canton; that the opium ships and outside traders have now got such a footing that it would be difficult to check them and that they will increase rapidly.

He mentioned a circumstance which he thought important and which marked a new era in that trade. At Kap Sing Moon,^[4] a harbour among the islands, near Lintin, into which the opium ships retire when there is an apprehension of bad weather, there was an auction held this year of some damaged cargo. The Chinese flocked to it and the goods were sold to great advantage.

In fact the ships at Lintin and Kap Sing Moon form a sort of floating colony (note – subsequently, whilst I was at Macau, I heard of two of the Captains’ wives giving cards for parties on board these ships – there are always six depot ships there, one of which, if not all, are licensed by the Governor General-in-Council to be at Lintin for opium.) Several of the Captains have their wives with them. Goods are warehoused in the ships. The principal merchants at Canton own one or more of these depot ships. They receive warehouse rent for storage. A town is forming on Lintin supported entirely as a bazaar for these ships.

The best harbour amongst the islands is that of Hong Kong, which is superb. The island of Hong Kong has a good deal of cultivated land and some high ground and would do well for a settlement.

Mr Gutzlaff

He has published in the first numbers of the Chinese Repository some account of his residence in Siam and first voyage to the coast of China. He has since been with Mr Lindsay in the Amherst and has now gone again in the Sylph, a ship of Mr Robinson’s which is intended to proceed to the very northern extremity of the coast of China or about 45º N and to visit Tientsin, the port of Peking, according to Mr Plowden.

He is also very decided in his opinion that the only way to deal with the Chinese is to be peremptory with them and to take what you want. He is impressed with the notion, which I find to be common amongst the informaries, that the Chinese government has no right to restrict trade. He is confident that an armed British ship might demand and obtain anything.

He believes the accounts of the Chinese population, amounting to upwards of 300 millions, to be true but admits that many parts of the coast are very barren, and the inhabitants generally are very poor and contented with a wretched pittance. The province of Fukien is that, of all those on the sea coast, in which trade would be the most easy – everywhere the people are eager for it and even the Mandarins impress the same feeling, but wish our government to apply to theirs. In Fukien however the people are the most intelligent and bold, and the junks principally come from that province.

All the Chinese rivers have bars but many of them are navigable for a great way into the interior.

Mr Nathaniel Alexander

He thinks the facilities for trade to the northward so great that in a short time Canton will become of little importance – that Ningpo ought to be our chief place of trade. He confirms the statements, but only from hearsay, of the people to the northward being both unwilling and unable to make any resistance; says that they have no troops amongst them and that on the voyage of the Amherst at ……… three Bengal lascars being sent aboard to cut the cable of a junk which would not move out of the way of the Amherst, all the crew of the junk, forty in number, leapt overboard; but he states what seems in some degree inconsistent with this – that on several instances in which our seamen and officers have landed in considerable numbers amongst the islands about Macau, the Chinese inhabitants have very resolutely and courageously opposed them and have shown a great determination to defend their possessions by all the means in their power.

Mr A is zealous for the extension of trade with China and says there are opulent Chinese merchants at Amoy who do not at all care for the government and will trade in spite of it.

Add also what he stated of the intended voyage of the Sylph and that it be now ascertained that the tea plant grows all along the sea coast of Fukien, I think, and the adjacent provinces, and that ships might be supplied there as well as at Canton.

Add the account of the American schooner of 90 tons, story informed by Mr Plowden. It was Mr Innes who was in command or superintendence of the vessel and directed the shot to be fired. There were 14 junks which all fled.

Dr T R Colledge

He is inclined to resolute proceedings and to the establishment of a trade on the coast and thinks that if we do not counterwork the Americans they will get the upper hand of us.

Mr T Beale

He is inclined to cautious proceedings and says there is a dual policy in all the measures of the Chinese government – thinks that the attempt to establish a trade on the coast will at least draw the vengeance of the government and the natives. He mentions that when the Phaeton (Pillow) threatened to destroy a Japanese …. unless he was supplied with beef, the Governor supplied him but committed suicide by ripping himself open to save his family and estate.

William Henry Chicheley Plowden^[5] 26th October

Agrees in view of consequences and that there must be ………  Embassy useless.

Point to be gained – a residence similar to Russia (note – it is evident the Company have wished to keep things close, otherwise they might have obtained leave for more space on a plea of increased trade. They took very little tea at first – now 30 millions of pounds.)

None have same privileges as Company except Russians at Peking

Robert Inglis 26th October

Alarm was taken at Amherst voyage but subsided on ship going away. Not in the interest of merchants to draw attention to their trade, nor embroil the two governments, but to make the most of it in the way it is now going on.

Opium trade is conducted with greater facility than almost any other.

May be so continued on the coast. Mode of agreeing with individuals at Canton to receive it on the coast.

Opium: that you must report and demand of the subordinates and that they will yield a good deal rather than refer to Peking.

Court at Peking, if not pressed too hard, will yield a good deal rather than go to war.

The Foo Yuen Choo would have been punished and sacrificed if we had insisted on reparation for his insult to the King’s picture.

Mr Plowden, Sat 28th October

None of the country trade merchants have licences. Several of them trade under foreign flags (e.g. Haylett). All this is contrary to English law, if enforceable. Yet the persons thus acting petition the legislature!

Since Mr P’s return he has been much plagued by the Chinese authorities about the voyage of the Amherst. He has disclaimed all knowledge of it on behalf of himself and the home authorities. It was Mr Marjoribanks doing. He acknowledges that it has shown that the people wish for trade but the government are as much opposed as ever. Things cannot go on as they are with respect.

First thing – take off restrictions on trade except tea – leave it to work its way. Assist merchants in extending Hongs’ size by some room, getting an island. Have to trade with a port – plead extension of trade. Boon to give up Canton. Purchasing for the state it will bring on …. into which Peking will be driven. Treaty to protect all islands. Have Portuguese cede Macau or else take Lintin. Americans, Russia and, the ESC (?) and the subjects etc. Papist institutions also managers. See Benkowski p.160.^[6]

The abominable state of confinement cannot be intended to last forever and have not …. grown-up to the point when the change may take place.

Capt Clifton Sat 28th October

If it had been sincerely applied for, more room might have been obtained.

An island is what is wanted.

The real state of affairs never reaches Peking.

Mr Davis Mon 29th October

Things cannot remain in their present state. Smuggling is so successful that fair trade cannot be carried on. Note the great facilities that the islands in the bay of Canton afford to smuggling.

 

No entries for 10 days then ….

 

Sat 10th November

Mr Plowden told me that this morning they were sending off a lakh of dollars to be taken home – in the Asia I believe – either that or the MacQueen; that last year they sent home about two millions of dollars – drawing Bills for them on Bengal – and that this year they should send home as much.

Note – this seems to be a new proceeding (see evidence to 1830 Select Committee of the Commons – 66 et seq of Marjoribanks.)

Note also that Captain Fremantle was sent to Bengal in May or June on the pretext that the Select at Canton could not go on without supplies this season and to solicit specie from Bengal.

Query If this has any connection with the diminution of the Company’s contracts which Mr Millet mentioned yesterday afternoon which he thinks has diminished the supply of tea – he said he had opposed the measure and said it would embarrass the market – injure the tea merchants etc., that this was actually taking place – that last year there were 30,000 chests less than the year before and this year 40,000 less than last year.^[7]

Mr Davis subsequently told me that Lord Ashley mentioned to him in 1829 that it was in contemplation to remit bullion in this way from China to repay the advances made in England on account of Territory.

Mr Plowden afterwards … on some of the proceedings of the factory, from which it appears that specie remittances were most recently ordered by the Directors in 1831. Their letter of 28th April 1831 required the Committee to remit two million dollars and was to go beyond that sum should circumstances permit.

But note the laxity of making the factory the Agents for the Territory, if indeed the factory be so; to determine which point enquire whether the Territory is creditor in account for the returns paid by them in discharge of the Bills or only for the account of dollars received.

If the latter, it is a ridiculous instance of the impropriety of blending commerce and politics. The Select Committee is notoriously incapable of dealing with the sharp merchants and everyone at Canton was holding up his hands at their improvident bargains – paying 3% premium for sycee silver etc. They are half the year absent from Canton at Macau whilst Jardine & Co reside constantly on the spot. They know nothing of the exchange – they are not men of business.

Mr Inglis thinks the Company would do better to leave the tea trade to private traders and confine their transactions to money.

He mentioned to me that the depot ship of Dent & Co which lies at Lintin as a warehouse for opium is licensed by the Governor-General to lie at Lintin and receive goods.^[8]

Mr Jardine told me at Canton (where Charles Grey went in the ‘missing’ ten days) that he thought the object to be aimed at was a settled commercial code and he thought the first opportunity should be taken for occupying an island: and that he should not be very particular in having any reason to assign for such a step. That the trade of the port of Canton should not be meddled with. He do not seem to be much afraid of any injurious consequences such a course might have for himself.

Mr Matheson, contrary to what Mr Jardine had said in a former day, said he did not know what better witnesses the Committee of the House of Commons could have examined if they had had Mr Magniac. Matheson mentioned that there are some thirty-three ships at Lintin … next page missing ….. I learned from them for the first time that when two or three of the officers of the Company’s ships were beaten on Dane’s Island at Whampoa, the boats of the ships were quickly manned and the sailors rushed on shore at which the Chinese fled. Three were caught and soundly thrashed and the village was rifled. I think none of this appeared in the Calcutta papers. There was some discussion about it with the Chinese authorities – but the English succeeded in giving it the appearance of the Chinese being at fault which really was the case. The Canton Government however informed the factory that if the English had been the aggressors they would not again have stopped the trade but would have put the Hong merchants to death – this is sufficient to account for How Qua’s desire to retire.

Mr Plowden:

The best mode of opening a negotiation with the Chinese would be to send out Commissioners to treat with Commissioners, or the civil government on their part, avoiding ceremony, not assuming style of any … or not asking to go to Peking and giving the whole a commercial and not a political character. Thinks this would be practicable. Does not think they would grant an island – perhaps might allow us to live on one on same basis as the Portuguese who pay a rent.

(this would be aided if we could get the Portuguese rights vested in us.)

There is reason to suppose that the Portuguese disclaimed the sovereignty of Macau in 1809 from an apprehension that the English were going to take possession and keep troops there. There was a clever man there as minister at that time, in the French interest, who certainly informed the Chinese of Admiral Drury’s coming and prepared them to resist.^[9]

(It is difficult to say how far the efforts of these Portuguese and theirs to thwart the English may extend. In ….’s mission, at Page 160, is the following passage:

the Chinese are acquainted with it^[10]from the intercourse of the Governor of Irkutsk with the Vang of Ouiga and the Chief of our {Russian} mission at Peking and also from the Portuguese missionaries in China. The latter had eagerly communicated to the Chinese the contents of the European journals which announced the defeat of the French Emperor.

i.e. likely seen as a threat by the Chinese Emperor)

Nothing could be worse conducted than the whole of our part of the affair. Admiral D was of great physical courage but not of resolved counsels. He threatened to blow the Viceroy’s palace about his ears if he would not receive his visit …. it never was received. He threatened to cannonade Canton if the fleet was not supplied …… it was not supplied. When the Chinese war junks were drawn up to oppose his coming up the river, he armed the boats of the fleet and sent them up under Captain Pillow and another with orders to attack. He remained at breakfast with Sir William Fraser after the flotilla had set out, began to think he had acted rashly, set out in a hurry to overtake them and only came in sight just in time to prevent the attack. Mandarin came on board his boat to inform him they meant to resist and his own boat getting a little beyond the others whilst they were still talking, a shot was fired at him from the junk which wounded two of the Mandarins. Admiral D clapped on his hat and stood forward to show he was not afraid of their guns but then dropped down the river and withdrew his boats.

Mr P mentioned the confirmation of the Chinese putting sometimes with an appearance of spirit that having orders to seize an American ship at Whampoa, a few years ago, which had opium on board, some Mandarins went down, surrounded the ship with junks and, at a signal, they hurrahed and rushed simultaneously from all sides on board the ship and took possession. The matter was afterwards accommodated by the American Consul. He agreed however that the Chinese would have no chance with disciplined and armed Europeans. Though very athletic and not a cowardly people, trained they would make excellent soldiers. Agreed also that the Chinese are impressed with fear of our power, but that instead of using this to submit open unqualified concessions, we ought to … them in favour and let them save appearances, being firm as to the main point.

Mr P mentioned the triad society, fears of the government of it, inability to suppress. Some members of it held meetings in the English burying ground at Macau – arms and seditious papers found – delivered to Chinese authorities. General impression of Mr P that there is extensive disaffection to the government and dislike of the Tartar dynasty.

I explained to Mr P what neither he nor any of the factory seem to have understood – the probable reason of the Authorities not permitting the land in front of the factories, when it was covered with water, to be built on but only covered with boards – it is plain it was a law of alluvium, see the Nam Hoi Yuen’s letter 31st March 1829, an understanding of this and a little humouring of the authorities would have gained all. If the plan had been gradually and quietly filled up and then the authorities had been asked to come and see if the river had not done it, it would have answered. They would have granted first an open railing and after planting this they would have granted a walk.

Mr Inglis

Chinese pirates are in force in several parts of the north coast. It may be feared they will attack and carry some of these free traders. They are bold and desperate. A short time ago one of the Chinese Hong merchants sounded me (Inglis) as to whether an English armed ship could be got to go …. against them but they are now so jealous and apprehensive of us that they would condone a great deal before they would take our assistance. The Portuguese however got Macau by rendering assistance against pirates – and an offer of our assistance might be made a useful handle in our negotiations some time or other.

Note Inglis would be a good man to be an accomplice. Either Jardine or Matheson or Whiteman good. The head of the factory. A Bengal civilian.

Mr Davis and Mr Daniells, Sunday 4th November

I noticed the discrepancy between Gutzlaff’s account in the Chinese Repository of the praises which the Chinese sailors bestowed on their country and government – and the accounts in Lindsay’s journal of their abhorrence of it. The impression of M/s D & D is that it is a happy country in the main and that the statements of discontent are exaggerated.

Mr Davis mentions the Putinga (persimmon) as a plant to be taken home. It is a hot house plant with a white flower and bears a fruit like a love apple – good to eat. Does not know of any in England unless can …..

… camlets which were a principal import of the Company are subject to a tax almost equal to prime cost. The consequence is an extensive smuggling of them and the Company cannot find purchasers at a remunerating price

Mr D thinks that one salutary measure would be legalising the sale of opium and then allowing the Company to exert themselves to put down smuggling – and says that the Chinese authorities have already hinted at the expediency of legalising the sale of opium.

Mr D seems not to have confidence the structure of the Chinese government nor where the real power resides. Viceroys usually one of the group of six – thought the Emperor really powerful. My own views as to the college being the real power were acquired in GL. Davis is going to find us his privately printed notes of the Peking Embassy. NB to investigate in the library all that is known of that college. The Chinese is a corruption of the Platonic beau ideal of government – a government of philosophers. There is a priestly tribe wherein they differ from the …. systems. But the college of philosophers is in lieu of the priesthood. It is connected with the college of rites.

Mr Plowden Sunday 4th November

The Amherst was sent to the northward by Mr Marjoribanks with the knowledge of the Directors. Mr Lindsay was instructed to conceal his connection with the Company. He … his Christian names Hugh Hamilton.

On Mr Plowden’s return to China, he had scarce landed at Canton before there were enquiries and remonstrance about the ship that had been to the northward and suggestions that it must have been by directions from home. They complained of it as an infringement of the law which restricts foreigners to Canton. The coast to the northward they described as the inner seas. In speaking of the ship they used such strange names that Mr P, ignorant of their having assumed false names, could not make it out. However both then and since, Mr P has disclaimed any knowledge on his own part or that of the Home authorities as to this ship.

Mr P told me today but indistinctly … that the Hong merchants paid for the rebuilding of the factory after the Great Fire (the Company some time ago sold the factory to the Hong merchants and now rents it of them, professedly this was done at the desire of the Chinese government. The motive may have been to prevent all claims of private merchants to buy land.)^[11]

Captain James Innes Tues 30th October

Is decidedly of the opinion that things cannot remain as they are. That the people will trade in spite of the Chinese government unless it is prohibited by the British government and actively prevented with help of the Company.

Hugh Hamilton Lindsay Tues 30th October

He took the name Hu Ha Mee (Hugh Hamilton); Gutzlaff became Ka Lee (Karl); Capt Reeves became Lee.^[12] The mandarins were most anxious to find out whether they had come by direction of their government. Their constant enquiry was for opium – why have you not brought opium. Mr L says none of them can resist it or subsist without it.

Mr L himself does not attribute so great an influence to the Hanlin and thinks the Emperor and the person, whoever it may be, whom he chooses to be minister, but he talked on this subject like a young man and one who had not considered the matter – his notions cannot be right. Mr Lindsay would not wish to have any island or settlement, but liberty to trade with all the ports or at least the principal ones and liberty to go about the …..

Mr Plowden Tues 30th October

Asked me today whether the mere landing and reshipping of goods at Singapore would legalise the investment here in private ships for England. I explained to him that it would be a mere question of fact.

Note – this evasion of the law is an instance of Indian legislation at variance with practice, of the evil effects of the union of commerce with politics and of want of a legislature (i.e. Singapore is a territory of the company since 1820s and comes under the Company’s legal jurisdiction including its Customs Regulations. Plowden is asking his Prime Minister if China goods shipped from Singapore would become India goods!)

Captain Innes Wed 31st October

Told me that his brother who was in the Amherst this late voyage, went on shore at Amoy, walked through all the streets and went into the shops. There was great civility but whenever he wished to purchase anything he was told the Mandarins would pay for it.

Mr He Shing, Wed 31st October

He is a ship’s comprador who went to show the shops to Mr Murray and surprised me by the boldness of his conversation. He knew the whole history of the Lord Amherst’s voyage and of Mr Lindsay being on it. Said he wished the Company was at an end because then the Hongs would not get all the profit and added ‘our government, damned bad government – Fan Kwai Emperor; he not Chinese man, him Tartar’.

Mr Govan Fri 2nd November

Told me the increase of opium in ten years was from about 4,000 chests to about 22,000 and the proceeds from about £4 millions – £12 millions but that, allowing one candareen (17.5 grains) per day to each smoker, which he considered a moderate allowance, there were not even now more than 1.5 million smokers in China. He promised to send me his table and calculations.

But note Mr Daniells has told me the price has fallen, that he does not believe that more than £1 million increase is obtained upon an increased supply of 5,000 chests and that actually the increase between 1829/30 and 1830/31 was 4,760 chests ($847,106.-)

Note also as to proportion of quantity that the Chinese certainly obtain some supplies of opium inland in the two directions of Yunnan and western Tartary, in both cases perhaps from India by Assam, Nepal or Kashmir.

Mr Wm Jardine Fri 2nd November

said that all the evidence yet taken by the Commons was of little value. They had applied to the persons least capable of giving information.

Mr Davis and Mr Daniell Sat 3rd November

They agreed that both the Chinese and the English governments together could not now put a stop to the opium trade. If stopped at Canton, the country trade would find means to carry it on in other ports – perhaps take an island, either on the coast or in the Bonin Islands.

Mr Whiteman at Macau Sat 3rd November

He thought that matters could not remain as they were. Spoke strongly of the degrading and disgraceful nature of the smuggling trade – it is not confined to opium, everything is smuggled – for which the innumerable channels opening from the bay into the surrounding provinces afford the greatest opportunities. But it involves all manner of deceit and brings those occupied with it into contact with the vilest of people.

His plan would be to obtain a cession from the Portuguese of their rights in Macau which he thinks a better station than Hong Kong, the latter is too much out of the main channel of the bay. Macau is at the junction of eight channels and near the inner passage. It would require some engineering to deepen the harbour which is filling up. This however he says might be easily done, the rocks close at hand which might be rolled down inclined planes would give great facilities.

Note that amongst the records of the Committee at Canton are both of the proposals of Lord Macartney at the time of his embassy

In Canton I heard of Governor Lee’s disgrace and there was a report of his being judicially strangled. The reason stated was his having deceived the Emperor both as to the character of the rebellion and his own defects in attempting to suppress it. But many doubted whether his intercourse and relations with the English and the displeasure of the government at the state of foreign trade had not a good deal to do with it. I think Lindsay’s heart misgave him that he might have contributed by …. the government by his complaints of the insults and oppressions at Canton and by giving Captain Reeves the nom-de-guerre of Lee, a confusion with the Viceroy.

Note that Mr Plowden showed me in the proceedings of the …. the English original of the paper distributed along the coast. It was drawn up by Mr Marjoribanks and seems to consist of a laudation of the English character, their moderation and desire to … the mutual advantages of trade, the insults and oppressions the English sustain at Canton. It was dated I think in December 1831, certainly just before Mr Marjoribanks departure.

Mr Colquhoun 20th November (i.e. after Grey’s return to Macau)

There are now only about 16 ships at Lintin, all the Americans having gone up the river, so that the numbers are frequently swelled by ships lying for a short time at Lintin which mean nevertheless to go inside and pay cumshaw and duties.

I had a general conversation with Mr Inglis on this subject. The evidence before parliament is defective, not so much from the character of the witnesses as from the committee members not knowing how to direct their questions. One point on which it is entirely deficient is as to what would be the right steps to be taken on the occasion of any rupture or of the Chinese government falling into confusion.

There are also several delusions running through this:

• One that the Company’s monopoly interferes directly and immediately with the free trade. This is not so. The Company abstains from interference and it would be difficult to show any direct impediment which the monopoly presents.
• But it supports the Hong system and the limitation of the trade to one port and this facilitates the imposition of high duties and the exactions of the Mandarins and these are the real impediments.

Lindsay sold goods on his voyage up the coast at $15 which a British merchant cannot sell for more than $8 at Canton and the embassy on its return very similar goods selling in the interior at $22. The increase on the price at Canton arises from the duties and exactions.

Another delusion is that a treaty would answer the purpose and a commercial code. This would not be so. The Chinese government, even if sincere, cannot enforce its own ….. There have been several Edicts prohibiting the exaction of duty on foreigners’ landing goods at Macau. Mr Inglis has frequently carried those exacting it before the Committee. It is always given up on those occasions but is regularly exacted in the next. For this …. he has resolved never to report again. It is a part of the Chinese institution, established by usage, that in opposition perhaps to law, that the mandarins who have wretched salaries, shall pay themselves by exactions. If you have a commercial code it would become necessary to take possession of territory to enforce it. There is no other course but of having several stations for trade and so many as to enable the people to smuggle.

Another delusion is that there are immutable laws in China which stand in the way. There are none such. The government is so weak and bad that there are no laws regularly enforced. Everything resolves into the risk of execution. The scale of opposition to trade is the well-founded fear of the government that you risk take territory – the confinement of the trade to one place – the Hong system – the exactions of the Mandarins.

Mr Inglis does not think that much can be done at present by parliament. He … agrees that it would be right to take away the prohibition against trading w/o the Company licence and is anxious to get rid of the Hong system in which opinion he says he formerly stood alone and that even his own partner Dent joined with Millet and others in getting into a difference with the Americans a few years ago who go upon the outside system whereas all the English thought the (outside) trade could only be carried on by the Hongs, but he says for the last two years the merchants have been coming over to his opinion.

Mr I acknowledged however that a free trade must bring on quarrels and thinks the great point of all is to be prepared how to act then but he does not seem to have made up his own mind exactly what should be done. He thinks everything for the moment might be obtained by insisting upon it and having a force at hand – but that the force would no sooner be withdrawn than it should relapse. He does not think the Lintin trade will rapidly increase in anything but opium. He says it has lasted 10 years without doing so. But he is impressed with a notion that the Chinese government is likely to break up and thinks something might be gained then by judicious and vigorous measures.

The result of this conversation … is the conclusion that the first thing to be done is that parliament, leaving the Company the tea trade for 5 – 7 years, should immediately repeal the prohibition against trading without a licence. That with a view to prevent or mitigate the disorder which may arise, encouragement should be given to the cultivation of the Chinese vernacular tongue and a system should be quietly arranged by the Board of Control of the terms to be insisted upon whenever the Chinese can be led to negotiate. The result at which I would aim would be a treaty whereby on condition of the English protecting the coasts of China from piracy, and from all attack by sea, and solemnly stipulating not to take any Chinese territory in the mainland, they should be put in possession of a sufficient number of islands along the coast of which they should have the entire administration with Courts of Justice and have free permission to reside and traffic in the principal sea ports as their … thereof, have a resident at Peking and let all offences whether by Chinese or British be tried by the authorities of the district where it takes place, some officers of the country of the … being allowed to be present to see fair play and that the prisoner is properly defended and such nation giving to the other for publication in a clear form its criminal code.

The under-plot by which this result might perhaps be ultimately obtained would be:

• The free traders gradually establishing themselves on Lintin in which however it would be necessary they should be countenanced, or at least not discountenanced, by the British government. I was much struck by the observation of Mr I that an island is of no use unless it is absolutely in the track of trade. Trade will not go out of its way to it. He instances the failure of Bathurst’s and Melville’s islands^[13] and from what both he and Mr Whiteman have said, I am much inclined to think Lintin or Macau is the place and that Hong Kong is too much out of the way to be the first settlement.
• In sending ships and establishing a trade to the northwards
• This will produce remonstrance and perhaps some violent effort on the part of the Chinese. The free traders ought to be able to support themselves and might have communications with the mercantile interest in England. The British government ought to proclaim the doctrine that, unless the Chinese government will act reasonably and amicably, it will not interfere to prevent its own subjects from trading with the Chinese people to any greater extent than that it punishes piracy on the high seas. If the Chinese refuse and hurt, the free traders must support themselves. If the Chinese do hurt, the best … would be a Commission consisting of the head of the factory – a Bengal civilian and British Canton merchants and an Anglo-Indian lawyer confining themselves to points of commerce. A few ships-of-war to back them would be useful. I would make no treaty that did not include either a general permission to trade and reside in the principal ports on a creditable footing or several insular stations. As much more of the terms stated above as could be obtained.

Mr Inglis

The boats which come down to Lintin to take the smuggled opium are of 40, 50 or 60 oars. The men are hired for the job for which, if successful, they receive $2. They are not Ladrones but are hired in Canton. They are remarkably fine men, are armed with pistols, and Mr I is quite certain that two of their boats would take any one of the opium ships.

When the Company’s supercargoes threatened to leave the factory and Mr Marjoribanks gave notice to the merchants that they would remain at their own risk, it was not the intention of Mr Inglis, nor of his partner, to have left. They meant to have run the risk for the sake of the profitable business they would have had and he says he knows it was the intention of Jardine and Matheson also.

Mr Haylett

Nearly all the opium that comes to Macau is brought from Damaun into which it is smuggled chiefly from Gujerat (NB – this conflicts with the suggestion in the Opium chapter that Malwa is carried across the desert to the Indus and shipped via Karachi to Damaun. This direct route down the Nerbuda River – passed the Company’s Customs Stations – is far more plausible but raises the certainty of corruption). It thus avoids the Company’s duty which is very great, say 200 rupees per chest. There is a duty of $10.50 at Damaun and the same at Macau. It can be sold as cheap as the Lintin opium because it has been bought at a more easy price and has not paid the Company’s duty. But it was part of the object of Colonel Pottinger’s late mission to put a stop to the Gujerat smuggling and he is said to have succeeded.^[14]

Mr Inglis thinks it is desirable above all things to do away with the system of Hong merchants … he says that both the factory and Jardine, who were at first of opinion that it would be infeasible to do …. have now come round to his opinion.

Mr Colquhoun told me that at Lintin the smuggling is carried on in the most bare-faced way. Boats of 40 or 50 oars are employed and they are frequently lying on one side of a ship whilst the Mandarin boats are lying on the other.

Mr Davis (India Company)

He confirmed his former statement that the smugglers undersell other articles besides opium so as to prevent the sales of the fair traders. He instanced especially camlets which were sold in considerable quantities last year at Lintin at from $10 – $15, the price cheaper than they could be got at Canton after paying duty.

Mr Inglis (Dents) does not allow that the trade extends much beyond opium, but rather avoids the question.

Mr Beale

He said the system of supporting themselves by … is so powerful and notorious amongst the Chinese functionaries that the … of a neighbouring province gave last year 60,000 Taels for his office with a salary of 2,000 Taels, which he will hold only three years.

Sir George B Robinson

All the opium chests are marked with the Company’s mark. Sir G has been on board by direction of the Committee for the purpose of seeing opium weighed.

Mr Haylett

Gave me today the table showing increase of import and consumption of opium since 1816.

Mr Inglis agreed with me that in case of future insults, stoppage of the trade is not the measure but seizure of a station such as Lintin and offering to let the trade go on. When you have Lintin, then bargain for advantages of trade, such as a spacious factory at Whampoa, etc., (Sir G Robinson says that now the sailors suffer much from there being no hospital to which they can be sent) and back up your application by a squadron at Tientsin and by £10,000 – £20,000 of secret service money.

Mr Inglis 22nd November

He said the stipulation which he should think of more importance than any other would be that of having a direct channel of communication with Peking and that any representation might go at once to the Emperor instead of fussing through twenty offices – this might be done by having a superior officer at Canton who should be authorised to communicate direct with the Prime Minister or by the British having a resident at Peking whom Mr I thinks, according to Sir J Roe’s advice, it would be better to have a native vackeel rather than an expensive British functionary.

Note that in the Chinese accounts of foreign merchants it appears that there was once an officer especially appointed for the purpose of communicating with … president of the merchants

Mr Inglis said he thought all disputes arising out of homicides by British subjects in China might be adjusted by paying a fine, for which in reality almost all crimes may be compounded, and at the same time bringing the individual to trial and satisfying the Chinese that, upon guilt being established, punishment will follow.

It strikes me that we might safely get possession of Lintin by gaining over the most influential of its present inhabitants and in their name building houses, etc. The inhabitants are said to amount to 5,000.

The only thing to be done at present by the English parliament is to repeal the prohibition against trading without a Company licence, and to free British affairs in China from political matters under the government of Singapore with a power to make … and to establish a Court of Admiralty there.

Mr Clifton 25th November

If the English take up any ambitious plan such as that of attacking Nanking or taking possession of that district between the two rivers which would command the internal navigation, it would alarm foreign nations and especially excite the attention of the Russians and the Americans. The right plan is to wait til the Chinese give you a fair and complete ground of quarrel. Let the whole gravimen be on their side, then take possession of two or three islands on different points of their coast e.g. Lintin, one of the Pescadores, Chusan or Tsiung Ming and Quelpaert(?) and threaten them with attacks and they will come into any terms. It has been injudicious in the Committee to have twice or thrice cut the Chinese and lost, as it were, or broken off with them when they were about to make a very pretty quarrel.

Mr Pearson 28th November

He confirmed all I have before heard as to the mismanagement of the business by Admiral Drury. His first mistake was in coming on without the order from Goa to deliver up the forts. Before it arrived Arriaga had contrived to rouse the Chinese and from that time the Portuguese have always put forward the Chinese and have disclaimed any pretensions to sovereignty. Admiral D had been in a state of insanity only a short time before.

Mr P agrees also that the Russians at Peking, the Americans getting round the Hong merchants, and the Portuguese priests by their missionaries and perhaps by some connection with the Hanlin, do a great deal to thwart us. Add the India Company.

Captain Alexander Grant & Mr Colquhoun 30th November

The opium chests at Lintin are all stamped with the Company’s mark. Some … opium has been sent on through Mackintosh & Co to be sold on the Company’s account.

Mr Marjoribanks, the President of the Committee, Mr Pearson the surgeon and Mr Lindsay the secretary, were very hoping last year for some days to board the Semarang, Capt Grant’s opium ship. (Grant says) Mr Davis was for some days on board one of the ships at Lintin last summer. They all saw opium delivered and, almost at any time, you may see a Mandarin boat on one side of the ship and an opium boat of smugglers on the other. For a fee, a Mandarin boat will undertake that the smuggling boat will go in safety.

How the Company’s ships stop at Lintin to take on treasure! The proceeds of the opium. The Chinese government allows the export of dollars, but the Company do not confine themselves to that but are sending sycee. The Company are remitting 3 million Taels this year.

Capt G has maintained that opium smuggling might be carried on upon the coast but it would ruin two or three Chinese companies now engaged in the trade at Canton who therefore set their faces against it.

The great market for opium is to the northward. There were at one time this season 34 ships at Lintin. Capt Grant is going to pitch a tent on the island by way of beginning an occupation – he says there is no sort of obstacle to foreigners going over the whole of it.

(Grant says) Mr Beale has been at Chusan many years ago, just before Lord Macartney’s embassy. He was in distress having been dismasted further to the northward. The Chinese treated him with great kindness and courtesy but would not allow him to trade.

Mr Matheson 30th November

It would be a bad thing for the opium trade if it was legalised and there was a duty imposed, but the sanctions would be so great it would go on as now covertly. Lintin is a bad anchorage in the S W monsoon.^[15] If a place was to be taken for warehouses and factories, it ought to be at all times easily accessible for boats. It will not be long before a depot ship is established somewhere to the north.

Capt Larkin (an Indiaman Captain) 30th November

He has express orders from the Court of Directors upon no account to have any intercourse or communication with the ships at Lintin. On the other hand he is ordered by the Select Committee to stop there to take on treasure. Note the direction of the Company in April 1831 to remit bullion to England is … an illicit trade, for the Chinese have prohibited the export of bullion.

Mr Inglis 30th November

The opium trade is 5/7ths of the whole trade besides the tea trade.

The Chinese would have given-in in the squabble about the factory garden if they had been pressed. They kept the … in the garden ready to be replaced for a whole year. The mode however of doing what was done by the factory was disgraceful. Carrying out beer etc., and sticking flags in the wheelbarrows. The private merchants were ashamed to go out and look at it.

If the government would make reasonable stipulations and would adhere to them it would be right to send away all who violated them but as they cannot suppress exactions, there must be a resistance to encroachment.

They know how they can bully us.

It is universally acknowledged that (if?) only the Committee had been turned out, the Foo Yuen would not have ventured to destroy the garden.

Capt Alexander Grant 30th November

The factory cannot pretend not to be fully acquainted with the opium trade. I had Mr Marjoribanks the Chief and Mr Lindsay the Secretary on board my opium ship for several days. Mr Davis and his family were also on board a ship last summer for some days.

The most convenient plan in the neighbourhood of Lintin, if you want only a place for a factory for warehouses or for ships to be close in shore and load, would be the Two Brothers – islands which are well sheltered from the S W monsoon and have deep water close-in with the land (The islands stood North East of Chek Lap Kok and were levelled during construction of the airport).

Mr Inglis 30th November

There is nothing to prevent the Dutch at Java or the Spaniards at Manila from growing both opium and tea. They are growing tea at Java and have got it tolerably good. If we were to abandon the opium trade, they would be sure to take it up.

Dr S 30th November

Mr Lindsay mentioned to me (to Dr S) that some time ago, last year I think, a Mandarin boat came and took a smuggling boat amongst the Lintin fleet – whereupon an armed boat from each ship was sent out and the Mandarin boat, making a show of resistance, muskets were fired, on which it turned and retaliated but the Lintin boats followed, keeping up a fire, and killed at least one person, respecting whom the complaints of the Chinese have not yet ceased. NB – this was at the beginning of March 1831, a few days before the Foo Yuen’s entry to the factory.^[16]

Mr Inglis 9th, 10th & 11th December

told me he thought there was another encounter of the same kind which happened some time before and in which the crew of a whaler from New South Wales were the most active.

Mr I informed me that the petition of the private merchants, after the Foo Yuen attacked, was Marjoribanks’ drawing out. His initiative seems not to be understood but all agree in considering him to have been playing a game. That Marjoribanks motive in sending Lindsay up to the northward was that by the failure of the voyage, which he suspected, an argument might be afforded against the attempt to open a trade.

Some years ago Plowden, Baynes and Millet assisted the Hong merchants in attempting to confine American trade to the Hongs. This irritated the Americans and failed as Inglis thinks all such attempts must fail. It was Millet’s doing, who is very inveterate against the Americans.

Mr Inglis told me also to say that it is the constant practice now to ship goods in free trade direct to England but to unload and reload at Singapore in the same ship – but see my note of the laws respecting trade with China that this is illegal.^[17]

Mr Inglis 11th December

The Chinese are less rude at Canton than they ought to be. I remember when they took a pleasure in walking against Europeans in the Square before the factories – or standing stock still so as to make a party, who were twenty together, to separate. They will do it now sometimes if you have not a stick but they have learned that a European will use a stick and it is curious to see how they eye one. They mind it much more than a pistol which they know will not be used.

The Chinese will always be rude to women if they dare. Women at Macau will meet with insult if they walk without men – story of Mrs Daniells, Mrs Roberts.

More than half the European residents have had affrays with Chinese – Inglis, Lindsay, Jackson, etc.

Mr Inglis 12th December

His (Inglis’) version of the Lintin affray. Two privateers licensed by the Mandarins at Macau. Extorting from a village which had bought rice. Villagers kill one man, wound another. Then they take a washing boat out of the fleet at Lintin. Boats … up hard and shots fired but the man had been killed by the villagers. The Mandarin who licensed the privateers subsequently poisoned himself.

Mr Plowden 12th December

Believes that there was a (code?) given to the ship by the Lintin traders. Mr Jardine admits that the conduct of the Lintin people was very wrong. Mr P anticipates further differences with the Chinese especially arising out of the voyage of the Sylph. Thinks that there ought to be King’s Commissioners sent out backed by a naval force – an island take possession of as something to negotiate with – and British residents sent away to Singapore or Manila. Add notice to Portuguese and offer to man the forts.

Mr Beale 12th December

Thinks it would please the southern Chinese for the English … take possession of China as to overthrow the Tartars and set up the old Chinese government at Nanking with the worship of the Lord of Heaven and Confucius.

Mr Inglis 13th December

Ting Hae in the river of Ningpo might be made a Gibraltar. Thinks prohibition of British subjects must be taken off. That it would be advisable to send an expedition to Tientsin demanding to have a Resident at Peking and to do away with the Hongs – would go as far in enforcing this as to burn their ships but is averse to taking an island. You could not make trade come to it. You could not carry on the trade in tea. Take no forts but have armed ships here.

Mr Beale 13th December

It is an injudicious order that prevents ships-of-war coming here. The Chinese think we are in the same situation as their countrymen who go to reside in foreign countries as outcasts.^[18]

Mr Inglis 14th December

The only way with the Chinese is first to take what you want and excuse it afterwards. That is to say, in those cases when you have strength, to keep what you take.

They used always to search the Company’s boats at the Bogue til one day Mr Baynes – they kept him waiting – went through without search and then it was found out that they did not care about it. If you are to take anything it would be better to take the Bogue than Lintin.

(NB – my notion is that, the trade being opened, the only accompanying measures that would be necessary would be to make regulations:

• constituting a tribunal for the trial of misdemeanors by subjects of His Majesty which acquire a fine not exceeding £500 or prohibition, temporary or perpetual, against the offender trading in China.
• Tribunal to consist of the Governor of Singapore, the Company President of the Factory and ten merchants to be appointed yearly by the Governor-General of India. The Governor of Singapore to have a casting vote and to be a …. Governor of Singapore to act only between 1st November – 1st March as case may be adjudged.
• An Admiralty Court at Singapore to which offenders may be sent.
• Ditto an executive … keep a frigate always at disposal of Governor of Singapore.
• If necessary take possession of the Bogue and Lintin and keep them for regulations of commerce but, to persuade the Emperor, there might also to be ships sent to the Yellow Sea

But the great plan of all is to unite the English, French, Americans and Dutch in one alliance with a mixed commission to regulate the trade. I would we press this upon them but letting them know our willingness, I would wait for their proposals which would come as occasion arose for them.)

Capt Fisk 14th December

There are 12-13 feet of water in the Inner Harbour of Macau. Ships of that burthen can go in at high water.

Mr Inglis 16th December

The Company have been buying sycee of us at 5% (premium) which is bought at 0.5% and it is curious that we bought it with Bills on Bengal at 212 rupees which are sent out to us from England to be negotiated and the Company buy of us with Bills on Bengal at 205 rupees (query if it was 205 or 207 but I think the former – and see my account in which Manderson was paid at the Company rate)

The rent paid us for warehousing opium in our ships is 1% per mensem on the value of the opium and we hold the greater part of the opium as security for our advances. These floating warehouses are the best and it would not answer as well for us to build warehouses either on Lintin or the Brothers. NB – the Captain of one of Dent & Co’s ships was present and said the Brothers would be out of the way in the N E monsoon and mentions difficult to get-off by reason of calms … but that it was capital anchorage in the S W (monsoon).

Earl Grey’s diary continues with conversations with fellow passengers on the voyage home from China, commencing December 1832:

Mr Murray & Mr Colquhoun 21st December

Patna opium is chiefly in request in Peking. It sells at $2,000 the chest or double the price at Canton. There is only one place in the province of Canton in which Turkish opium is freely bought. The trade is chiefly in the hands of the Americans. It sells at Canton at $400 – $600 the chest. A chest contains something better than 130 lbs. Turkish opium is selling in London at 10/- the pound (c. $260 per picul of 133 lbs.).

Mr Pearson

The reason why the Chinese do not grow cotton is that it requires the best ground – and that all their ground is wanted for sustenance. On the Embassy, whenever we saw cotton growing, it was in fields adjacent to those in which there were wheat crops.

Capt Manderson

The reason why Bourbon cotton is not sent to China is that it would not fetch a remunerating price. The worst cotton of India answers better.

Mr Pearson 9th January

Is averse to any warlike operations against China. Would make it always the first point to have justice on our side. Thinks that a few plain principles, together with a firm adhesion to them, is all that is required. That by insisting always on reasonable points only, and by always gaining these, a system of relations might be assuredly had. That it would be impossible to return to the closed system of 1793 – 1813^[19] and that a smuggling trade will go forward but that in comparison with the whole affairs of China and especially the inland trade and fisheries, it will be a mere drop of water in the ocean.

(Note – I think he is wrong here. The whole of the fishing population would be enlisted in the smuggling service. A trade along the whole coast of China would create an active and intelligent body dependent on commerce and allied with it, which would disunite and overthrow the present system of Chinese government. Mr P’s main mistake is in thinking it will be an easy matter to regulate the relations with China, such as they would henceforth be, by enunciating one or two old laws. It will on the contrary be a difficult and ever-varying task and one with which any ministry must be exceedingly harassed in a reformed parliament. The difficulty will consist in applying and enforcing the old laws.

That concludes the entries in 2^nd Earl Grey’s diary. We now return to the newspaper articles.