devising this plan, which avoided panicking money markets. ‘So great was the public desire to become acquainted with its opinion of the event’, recorded the Bankers’ Magazine, that ‘numerous reprints were required of the issue of the Economist following the announcement of the breakdown.’31
Nor was this the only display of its standing in the City. The Barings Crisis also signalled the end of a long investment boom in Australia, which for the next decade struggled to export enough to service its debt.32 In 1898 an Economist report exposing gold mining companies in West Australia, one of the few bright spots in the economic picture, as a ‘conspiracy to deceive investors’ led to a libel case against it. Johnstone agreed to withdraw any aspersions on Scott Lings, a Manchester cotton promoter and chairman of Golden Link Mines, but maintained the report had ‘been fully justified by events’ since the much-touted ‘main lode’ had still not been struck. Both parties, strangely enough, confirmed the special status of the paper. A simple retraction would not do, explained Lings’s lawyer, for ‘the very fact that the Economist has never had a libel action brought against it, and that it is a highly respectable and responsible newspaper, made it imperative’ that its statements ‘should be withdrawn in the most public way possible’.33
The Economist may have been more prudent than the competition, but it was no less optimistic about the overall direction of investment. It could become downright sanguine, in fact, when the capital in question was in good hands – a tone set by Bagehot, for whom the emigration of young men ‘with English capital’ to ‘manage English capital’ was one of ‘the great instruments of world-wide trade’ and ‘binding forces of the future’.34 South American investments had not only been profitable, but from this perspective, quite secure: it reminded readers that most of the ‘railways, tramways, gas, mining, improvement’ and other companies ‘in which our money has been sunk are purely English, in so far as the directorates and shareholders are concerned’.35
These statements hinted not only at the scale of British holdings, if direct investments are added to the portfolio type, but at the potential threats to them from rival national capitals.36 The problem was practical. Between 1878 and 1914, European territorial empires expanded massively, adding 8.6 million square miles throughout Asia, the Middle East and Africa. Germany, Italy, Japan, the US and even Belgium, as latecomers to the imperial stage, now joined older powers such as France and Russia to compete with Britain for land, resources and markets; the risks involved in the ‘new imperialism’ were manifestly higher. For Johnstone’s Economist, analyzing investment prospects also meant deciding what limits, if any, to place on this growth; when and where inter-imperial conflict could make way for cooperation; and how newly subject peoples ought to be treated.
A Liberal Scramble for Empire?
The imperial landscape was already shifting rapidly – and taking more newsprint to cover – in the years leading up to Johnstone’s tenure. In 1877, Disraeli made Queen Victoria Empress of India, a move intended to rally India’s princelings to the British Raj. The Economist did not see what difference it made to Indians what she was called – ‘a great army and navy was behind the name, and that is enough for them’ – but it did wonder at a Conservative prime minister tinkering with the ‘magic’ of the English Constitution.37 The ‘Eastern Question’ re-emerged at the same time, as Russia launched a new war against the Ottomans that threatened to redraw the map of south-eastern Europe in its favour, and undermine British naval predominance in the Mediterranean. The Economist favoured intervention to avoid this outcome in 1878 – first welcoming a diplomatic convention to backstop Ottoman rule in Asia, then endorsing the Congress of Berlin, which divided up most of the Balkans between the Europeans, and handed Cyprus to Britain.38 A new skirmish with Russia irrupted almost immediately, however, when the Tsar sent his ‘envoys’ to Afghanistan. Britain promptly invaded, with the paper calling for an ‘irresistible demonstration of our power’ to depose ‘Ameer Shere Ali’ in Kabul and shore up the north-western frontier with India in the Second Anglo-Afghan War.39 At the same time, Britain also pressed forward in Africa, brutally uprooting the Zulu nation in 1879, clearing a path for white settlers hungry for its land and labourers. The Dutch-descended Boers in the neighbouring Transvaal then rebelled against the prospect of being annexed too, temporarily checking British expansion at Majuba in 1880 during the First Boer War.40
The Economist tried to take stock of the frenetic pace of imperial activity the year Johnstone took full control of the paper in 1883, sounding a more prudent note than before: London needed room for manoeuvre in imperial affairs, but should carefully weigh further territorial commitments. ‘The air is thick with projects of annexation. In Africa, in Asia, and in Australasia, schemes of conquest or of colonisation are being pressed forward.’ Though some chances could not be passed up – ‘to such enterprises as the opening up of the Congo we cannot, of course, be indifferent’ and there could be no red lines ‘where we can say thus far and no farther’ – on the whole, ‘consolidation and development rather than fresh adventure’ was the wisest course. It reminded readers of the vast possessions already under British sway – an expanse sixty-five times the size of the British Isles, twice the area of Europe, with an estimated populace of 217,695,000. ‘Our interests will be better promoted by international agreements as to freedom of trade, than to extend our dominion over new land.’41 Let latecomers, ‘under an emotion of tropical territory’, fight for leftovers, as Britain and the Economist focused on the invisible bonds of capital being laid by the City of London. This was not because territory was unimportant to the paper, but because Britain already had the best bits, ‘holds all coaling stations on the two routes to the far East’ and the ‘keys of the Mediterranean, of the Red Sea, of the Persian Gulf, the Straits of Malacca, the Eastern Archipelago, and rules in unquestioned and practically lonely sovereignty the people of India’.42
If the paper favoured indirect forms of imperial control based on trade and investment, it recognized the necessity of the territorial strings often attached to them. After Egypt had followed Turkey into default in 1876, its main creditors, Britain and France, had imposed a ‘Dual Control’ over its budget.43 This violation of Egypt’s sovereignty stoked a nationalist movement, led by Colonel Arabi Pasha, which the creditor nations promptly resolved to crush. The Economist had pondered a joint expedition even before the deaths of fifty Europeans in Alexandria in June 1883, during riots that broke out when British and French warships appeared off the coast.44 Now that law, order and European lives were at stake, action could not wait. Admiral Seymour’s shelling of the city the next month was ‘an act not of aggression, but of self-defence’, while the ‘burning and pillaging’ it triggered among the Egyptians – ‘pure vandalism’, ‘no strategic purpose’ – showed that Arabi and his followers were ‘not high-minded patriots’ but ‘military adventurers, capable of any excesses, and caring little what injury they inflict on their country’.45
The Economist considered the ‘preservation of our right of way through the Suez Canal’ a matter of life and death for Britain. But in making the case for a swift invasion of Egypt, it also insisted on unselfish motives: dutifully reporting on the risks of disorder to ‘the City and businessmen’, it dismissed these as a casus belli. Britain was acting on liberal principles. Egyptians had registered anger at their ‘“exploitation” by bondholders’. ‘But bad as some of its features may have been’, surely they ‘would be glad to return to it’ – given the ‘paralysis of industry’, ‘growth of official corruption’, ‘revival of torture’, ‘diminishing security of life and property’, and ‘other Oriental abominations’.46 Any new regime in Cairo would, meanwhile, be submitted to all the powers of Europe for ‘sanction’ – a point to which it returned even as it cheered the rout of Arabi by 31,000 Anglo-Indian troops in September.47 Here tutelage proved unavoidable: ‘we have tried to govern Egypt through its treasury, and the attempt has failed.’48 So during the ‘temporary occupation’ that followed,
