I got a fascinating array of responses to my Tuesday post about the 21st century nabobs, striding over politics and society with their unheard of wealth and indifference to the rules we once imagined bound us. One of the big questions was, What happened to the original nabobs? Were they brought to heel? And several of you asked, Okay, so what are we going to do about this? I wanted to discuss these and other topics.
To the first, I have no deep expertise on the fate of the original nabobs. But the general answer is that the British East India Company was regulated and nationalized in stages over the three-quarters of a century between the period we were discussing Tuesday (1770s and 1780s) and its final dissolution in 1857 after what the British then called “the Mutiny” and the India now calls the First War of Indian Independence. Oversight and control of the Company grew to the point where eventually the Company and its shareholders were still reaping the profits but it was the British government that was deciding policy. After the 1857 rebellion the Company was abolished altogether and that’s the point at which, formally, Britain’s Indian “Empire” or the Raj begins.
Warren Hastings, the first Governor General of the Bengal Presidency, was also impeached by parliament, though he was eventually acquitted after an impeachment trial that went on for seven years. (Trivia alert: During Bill Clinton’s and later Trump’s impeachment trials, Hastings’ trial came up frequently since it is the origin of various precedents or at least a lot of basic understandings of how such a trial works since there actually haven’t been that many trials where there were major disputes about guilt.) So the British state reacted with a mix of regulatory oversight and legal prosecutions. Over time, the nabobs just blended into the woodwork of the normal superrich or interwove themselves, over generations, into the formal aristocracy.
The other part of the equation is that after the crackdown on the Company in the late 18th century, it was no longer possible to make quite the same amounts of money. This is a point of some delicacy since, as anyone who’s studied the Raj knows, the Company remained quite rapacious. But this only serves to drive home the point about the wild, darkly farcical nature of the piracy of this era of British rule. I’ll note just a few representative examples. In the key years when the foundations of the British power in India were being built, the key player was a man named Robert Clive, perhaps the prototype nabob, a Company official and eventual general and, in effect, a warlord. After a series of key battles in the 1750s and 1760s, Clive was able to cajole and pressure the Mughal Emperor, increasingly a figurehead of a disintegrating empire, to give the Company the diwani of Bengal. This was essentially the right to tax. And Bengal was one of the wealthiest provinces in the world at that moment — in terms of economic productivity, wealth and the taxes that could be extracted from it. By this act, Bengal became in essence of the property of the East India Company. The subsequent conquest, organization and consolidation of British rule could all be funded out of the Bengal tax base. When Clive saw that the final coup de grace was coming, he rushed word back to his agents in Britain to buy up as much Company stock as possible knowing that its value was about to skyrocket. Remember, Clive was an employee of the Company. I’m glossing over an ocean of details here, hopefully not to the point of misrepresentation. But I’m trying to give a sense of the mix of insider trading and profiteering that was involved and the bizarre ways that sovereignty and private companies were mixing together.
It took about a generation before the Company could be persuaded to actually spend some significant amount of that tax income from Bengal on governing Bengal in even the most basic sense. And this period of dislocation, misrule and chaos was at least a significant contributor to the Bengal Famine of 1770 in which millions died. It was in this era that it was barely an exaggeration to say that any Briton in India, and especially in Bengal, could simply walk up and take almost anything he wanted. By the early 19th century, a generation or two on, it was still very much a system of wealth extraction. But it was more orderly and formalized. When it came to the rule of one of the most populous regions on earth, it was the British government that was calling the shots.
This is a recurring pattern through European imperial history. We begin by seeing private companies operating almost like governments and then the nominal governments begin slowly clawing back that power in stages. If you go back to the key original conquests in the Americas, of Mexico and Peru, there was a similar trajectory. There weren’t joint stock companies. That was a critical innovation of northern Europe — the Netherlands and England. But all of these European kingdoms had very limited state capacity. They seldom had the financing or sustained focus for these conquests, at least not at first. They would generally just hand out licenses, or their subsidiary governors would do so, to independent operators to just give it a go. That’s how the conquests of Mexico (Aztec) and Peru (Inca) happened. Conquerors like Cortés and Pizarro began with near-total power, only just nominally under the power of Spain. It was a generational process by which the Spanish Crown slowly clawed back authority.
Which brings us to something related. It connects up with some of this history and gets us to the essence of the issues we face today in the U.S. and around the world.
TPM Reader AR sent me this piece in Unherd, “Silicon Valley strongmen want to lead the West“. (It’s paywalled. But I was able to read it just by giving them my email.) I found it a very interesting read. It’s a dual review essay, one book called The Hour of the Predator by Giuliano da Empoli, an Italian civil servant who is sort of the representative here of the declining liberal world order and The Technological Republic by Alex Karp, CEO of Palantir, who represents, even really in his estimation, the predators. The essay and da Empoli’s book began with Hernan Cortés and the conquest of Mexico. He is the model of the predator, the precursor to the Trumps and the Musks, or the Borgias and the Rhodeses.
The essay begins with a certain view of the conquest of Mexico, how Montezuma repeatedly temporized in the face of the novelty and terror of Cortés’s appearance. He’s the rule-based international order. Cortés keeps making big gambles and it keeps paying off for him. This is a very idealized way of understanding the conquest. But there’s a real truth to it. And there’s a real commonality between figures like Cortés and Clive. Emboli argues that we’re moving into a new age of strongmen or predators of this sort who are chewing up, plowing through the old system by ignoring the rules and resorting to brute force, moving fast and breaking things and dealing with the breakage once they’ve been granted the diwani or taken Tenochtitlan. Karp’s big point is that the would-be warlords of Silicon Valley need to move on from fripperies like social sharing platforms to things like weapons and other bases of state power — a fairly predictable argument for the CEO of a company that produces state surveillance software but also one that embodies the 2020-2025 arc of Silicon Valley.
What’s so interesting about this review is that, at least in the reviewer’s estimation, Emboli and Karp have a quite similar understanding of what’s happening. They’re just on opposite sides of it, with Emboli having some element of respect for the predators or at least an awareness of the exhaustion of the Old Regime and Karp unable to help clinging to some of the totems of the Old Regime as something the predators will somehow, rather improbably, vindicate. There are a number of recent books which are basically placeable in this schema, like Nate Silver’s On The Edge: The Art of Risking Everything, which divide early 21st century America into a world of rules, risk aversion and expertise rooted in the universities, non-governmental organizations, and elite culture generally and another of risk-taking, experimentation and creative destruction emanating out of Silicon Valley.
All of these ideas have the standard mix of insight and self-glorification. The exhaustion of the old order is the part of this constellation of ideas that seems the firmest ground to me. A few months ago, I said that the greatest proof case for Trump’s claims about the corruption of the American elite was the ease with which he plowed through it. This isn’t just a bit of clever inversion or word play. It’s foundational to understanding everything. There’s also a greater clarity now, one of the few saving graces about Trump’s reelection and his campaign of destruction over the course of 2025. The old system, whatever its merits, is clearly and unequivocally broken and something new has to be built in its place. Something stronger, something more ready to use and comfortable using political power.
This is why, whatever the outcome in seats, Democratic governors rushing to meet Republicans in their gerrymandering push has been one of the most positive developments in politics in the last decade. Nothing is more enervating, demoralizing or hopeless than being the upholders of the proprieties of a vanquished order. Simple rule-following or, even worse, norms-following is simply too thin a reed for any political movement or political party. We have laws not simply to have laws but because the law is the only possible brake on the strong trampling over and exploiting the weak. And if some people become too strong, it becomes impossible for any of us, individually or collectively, to be truly free. This could scarcely be more relevant to an era in which the rest of us appear to live more or less at the sufferance of a few handfuls of centi-billionaires who have graduated beyond the obstacles of consequences or law.