Fist Of History

October, 2013Archive for

Egypt 1876 – Sovereign Debt Default and Foreign Interventions

Friday, October 25th, 2013

Ismail_Pacha

This entry could also be titled “What happens when a country borrows too much money, can’t raise more, and lacks a particularly powerful military.”  The gentleman pictured above is Ismail the Magnificent, ruler of Egypt from 1863 to 1879, was a 19th century progressive dream ruler – he strove to take Egypt from its traditionally dominated government and society and rapidly thrust his nation into the modern age.  As he took the throne of Egypt the nation was undergoing an economic boom, the price of cotton was elevated globally due to the United States Civil War and the coffers of the Egyptian state were swollen with increased tax revenue.  Ismail however pursued his aggressive modernization schemes far too rapidly for his state to absorb the costs – during his reign he funded a major railway expansion in Egypt, a heavily reformed post office and customs system, commercial stimulation, a government sponsored sugar industry, major urban renewal and expansion programs, a state supported theater and opera house, and a series of expensive and nasty wars in Ethiopia.  He also oversaw the completion of the Egyptian portion of the Suez Canal and engaged in a nasty legal battle with the Suez Canal Company, a case he lost when Napoleon III arbitrated a concessions dispute and awarded damages to the Suez Canal Company.  Ismail needed huge influxes of capital to fund all of these ambitious goals so he borrowed and expanded Egypt’s sovereign debt.  He expanded it a great deal.  When he came to the throne Egypt owed three million pounds sterling in debt, at the end of his independent reign Egypt owed one hundred million pounds sterling in debt.

At that point Egypt was funding its debt with more borrowing, Ismail had hocked the valuable government held shares in a the Suez Canal Company for a pittance, and Egypt had reached a point that by 1876 it was no longer able to “service its debt” – i.e. pay the interest owed on the borrowed money.  A commission was sent, headed by two British government officials, to investigate the problem and seek a solution.

220px-Stephen_Cave_Vanity_Fair_3_October_1874

Above is one of them, Stephen Cave, the finding of the British Commission was that the only way Egypt could hope to resume service on its massive debt was to accept foreign intervention into its financial affairs.  In a move many today would recognize Egypt was put on an austerity budget and revenue from the Suez Canal, customs and import duties, and other government income sources passed through a foreign holding company which ensured that the debt holders got payments first and the Egyptian state got a fixed remainder of the budget.  (The holding company was known as Caisse de la Dette – the Public Debt Commission.)  These reforms lead to a sizable reduction in the available budget for Egypt’s other government projects, which in turn provoked a major uprising by the Egyptian people against their government’s acceptance of these actions and the power of the Public Debt Commission.

Port_Said,_The_Office_of_the_Suez_Canal_Company_(n.d.)_-_front_-_TIMEA

This story doesn’t have a happy ending for popular sovereignty, by 1881 popular unrest, discontent in the Egyptian military, and other factors lead to a rebellion, this concerned the British who in 1882 began military operations against Egypt.  The ensuing Anglo-Egyptian war lasted for about a year and ended with Britain crushing the locally raised armies and imposing British control over Egypt.  Britain, along with France, also continued to control the revenues of the Egyptian government and enforced the servicing of Egypt’s debt until the end of the British occupation in 1954.

Sources:  Wikipedia entry on Isma’il Pasha, on Egyptian History in the 19th century, on the Caisse de la Dette, and on the British rule of Egypt

Burke and Hare – corpse rustling for fun and profit

Thursday, October 10th, 2013

burke-hare-better

Meet William Burke and William Hare, commonly known as Burke and Hare, who from late 1827 through 1828 went on a very popular murder spree in Edinburgh.  They both moved to Edinburgh, separately, to seek better economic opportunities and came to know each other because Burke and his wife ended up living in a boarding house owned by Hare and his wife.  The two of them were your rough, basic uneducated workers attempting to earn cash by either general labor or by being a small business owner.  So in November 1827 when a long term resident of the Hare boarding house unfortunately died while still owing 4 pounds in back rent, this presented an unfortunate situation for Hare, he needed the cash and the dead man owned nothing of value to sell to recoup the loss.  So the duo hit upon a fascinating plan, they substituted a casket filled with junk for the corpse and wheeled the dead body to the local university to see if they could make up the loss by selling the dead man as an anatomy lesson subject.  Once at the college they were steered towards the anatomy labs of Dr. Robert Knox.  Knox’s various assistants and aids handled the gritty business of paying for corpses and one of them paid Burke and Hare 10 pounds for the corpse and thanked them for the fine subject.  Now, 10 pounds was a lot of money at the time, according to Wikipedia it is roughly equal to $1100 in US currency today.  These two enterprising gentleman saw an opportunity present itself but, unfortunately, people don’t often randomly die at convenient times when you need to make some extra coin.  So the two decided instead to create their own steady supply through murders.

They went about it with a fairly straightforward approach initially, killing poor isolated individuals who sought out shelter at their lodging house and carting the corpse off for sale.  Apparently their favorite method of delivery was to stuff the corpse into a tea chest but, if that was too small, they’d instead ram the corpse into a barrel and wheel that to the college.  They ended up, in the span of roughly a year, killing and selling a total of sixteen individuals, twelve of them women, using increasingly indiscreet tactics in selecting their victims and handling the corpses.  (At least one victim was a local lady that Burke invited to his brothers house and killed one when the other left the party.)  Eventually the two were caught when a pair of short term lodgers, having spent a night at the boarding house, when they returned to collect a pair of stockings left at the boarding house accidentally discovered a recently procured corpse stuffed under a bed.  The two lodgers rejected a clumsy bribe offer by Burke, and probably joining his collection of profitably sold corpses, and reported the find to the police.  Although the corpse was gone by the time the police arrived they arrested the duo on suspicion and, based on an anonymous tip, found the remains in the dissection lab of Dr. Knox of some of the other victims.

burke-execution

The actual trial was fairly dull, the police convinced Hare to turn states evidence against Burke and Hare ratted out his friend to escape the gallows.  Burke and his long-term lover Helen McDougal were put on trial but the state didn’t have a case strong enough to convict his wife, so she was released.  Burke was found guilty and sentenced to hang, a sentence carried out on 28 January 1829.  The other three vanished, over time, into the underbelly of England and Scotland, although not without being chased in many cases by mobs.  Dr. Knox was subject to a public scandal due to his indirect involvement in what happened, but was able to leave Edinburgh and restart his career in London.  (The value of having all the dirty work conducted by assistants and associates.)  An interesting note on Burke though, the judge ordered his corpse given to the college for dissection and preservation, the dissection was such an event that a small riot broke out in the crowd who wanted to see the murderer getting cut up and there wasn’t enough room.  (The issue was settled by allowing the crowd to pass through for brief periods, in lots of fifty, to see the dissection.)

burke_skeleton

Burke, or what is left of him, currently resides at the Edinburgh Museum of Anatomy, where you can still see his preserved skeleton to the present day.  Part of his skin was tanned and used to make a calling card holder and a small appointment book, both of which are housed at other museums.

BURKE SKIN POCKETBOOK

Burkesskin1

He has also left us with a phrase in the English language, to “Burke someone” is to kill them through suffocation – due to Burke and Hare’s favorite method of execution, smothering with a pillow.  Finally this crime has left us with a fantastic rhyme:

Up the close and doun the stair,
But and ben wi’ Burke and Hare.
Burke’s the butcher, Hare’s the thief,
Knox the boy that buys the beef.

God bless the children and their adorable rhymes for horrible crimes.

Sources:  Wikipedia entry on Burke and Hare Murders