Let’s be quite clear about this: people came to Port Phillip to make money as individuals. It wasn’t a penal colony like Van Diemens Land or Sydney. It wasn’t a philosophical-cum-evangelical political experiment like South Australia. It was not a privately-run settlement scheme like Western Australia. It was conceived in the pubs of Launceston, and talked over and gesticulated to by the pastoral overlanders of Sydney, by men out to make a motza and the government could just get stuffed. And even more importantly, in the early years people came to Port Phillip from another Australian colony, rather than coming out straight from Europe.
As part of thinking about financial security in 1840s Port Phillip, I recently read Simon Ville’s article ‘Business development in colonial Australia’ . He points out that New South Wales (of which Port Phillip was part) had strong entrepreneurial capacity:
1. There were the ex-convicts and emancipists who had been either pardoned or their sentences had expired, who, swept by fate onto the other side of the world were denied conventional routes to achievement, but had scope to forge their own, too. Certainly some had only a poor education, and they often lacked institutional and infrastructure suport. But some also had a strong desire for legitimacy, esteem and recognition.
2. There were the government officials, who had had access to higher educational levels, but were not motivated by the need for social elevation. Because of their position in a penal colony, they had access to a means of overseas payment and free labour. Particularly in the first decades, there was scope to indulge their entrepreneurial proclivities. This was less true of Port Phillip than Sydney, but is nonetheless worth bearing mind when Judge Willis started castigating government officers for “speculation”.
3.There were colonial merchants living locally. They were usually from Britain; sometimes from India, and they brought with them their accumulated experience of previous success, capital, information and credit links of their overseas partners and agents.
I suspect that there’s a fourth group too. Jim McAloon speaks of settler capitalists, of lower middle class origins who brought with them the values of the British middle class: thrift, deferred gratification, self reliance and steady capital accumulation. Although his research is based on the South island of New Zealand, he cites Paul de Serville’s work in Port Phillip on the colonial elite which distinguishes one fifth of them as gentlemen by ‘birth’ as distinct from gentlemen by education and profession and a large group of unclassifiable middle-class gentlemen.
Industries and opportunities draw on innovation for success (Ye Gods! I sound like a management textbook!). Innovation doesn’t just mean invention of the completely new- it also involves the modification of imported technology to local circumstances. Often entrepreneurial decisions of this kind are made under conditions of great uncertainty and highly imperfect information- and you can’t get much more uncertain and imperfect than settlement in a new colony on a new continent in a different hemisphere.
Ville points out that vertical integration is common at the start of an industry’s life, and a signal of a low-trust environment, but that as an economy matures, vertical integration is replaced by specialization . Vertical integration is a form of management control where all aspects of a product or process are under the control of a common owner. For example, the Sydney merchant Robert Campbell was involved in whaling, shipbuilding, shipping, banking and farming. Early NSW certainly qualifies as a low-trust environment: the convict origins of the colony were reinforced by mutual suspicion between convicts, officers and immigrant merchants. Networks, bound by social, religious and kinship ties provided a high-trust organizational form based on common interests and propinquity. Often individual entrepreneurs operated several distinct partnerships with different business associates. Certainly in Port Phillip, we can see that entrepreneurs were involved in diverse activities- e.g. general mercantile, shipping and commission agencies, wool purchase and consignment. Their ubiquity and prominence makes them particularly important when we consider who backed whom in the local politics of the district, and especially in relation to Judge Willis’ dismissal.
Edmund Finn (‘Garryowen’) speaks of the Twelve Apostles who were dominant in financial circles in Port Phillip in these early days. They are:
- William Frederick Augustus Rucker, Merchant
- Thomas Herbert Power, Auctioneer
- John Pascoe Fawkner, Landholder
- Alexander McKillop, Settler
- John Moffat Chisholm, Landowner
- John Hunter Patterson, Landowner
- James Purves, Landowner
- John Maude Woolley, Settler
- Abraham Abrahams, Merchant
- Jonathan Binns Were, Merchant
- Horatio Nelson Carrington, Solicitor
- Patricius William Welsh, Merchant.
I can tell you now without going any further, that this group of men, like nearly every constellation in Port Phillip was split right down the middle in relation to Judge Willis. Fawkner was his staunchest ally, Carrington his most ardent enemy, and the rest are distributed between them (with perhaps, at first glance, more opposed to him than for him).
My task is to look at these 12 men. Do they fit into Ville’s three categories at all? How does de Serville classify them? What was their entrepreneurial story in Port Phillip? How did the 1840s financial meltdown affect them? And what position, if any, did they take in relation to Judge Willis?
- Ville, Simon P. ‘Business Developmentin colonial Australia’ Australian Economic History Review vol 38 no. 1 March 1998 pp.16-41
- McAloon, Jim ‘Gentlemanly Capitalism and Settler Capitalists: Imperialism, Dependent Development and Colonial Wealth in the South Island of New Zealand’ Australian Economic History Review, Vol 42, No. 2, July 2002
- de Serville, Paul Port Phillip Gentlemen and Good Society in Melbourne before the Gold Rushes, Melbourne, Oxford University Press, 1980
- Finn, Edmind, The chronicles of early Melbourne, 1835-1852: historical, anecdotal and personal (by “Garryowen”, Melbourne, Fergusson and Mitchell, 1888 p. 707