6 January 1639: Virginia orders the destruction of its tobacco crop

King James I of England found smoking tobacco repugnant. It was “a custom loathsome to the eye, hateful to the nose, harmful to the brain, dangerous to the lungs”. But when it came to the tax revenues it raised, well, that was different.

In 1607, John Rolfe and his band of colonists had been dispatched to the Americas to find and send back gold. They didn’t find it. But they did discover that tobacco plants flourished in the surroundings of the colony they established in Virginia, and it turned out to be the next best thing. Smoking became all the rage back home.

The king granted English merchants a monopoly on the supply, which was subject to duty upon being unloaded in London. To keep prices (and the tax-take) high, growing tobacco in your back garden was banned (although many did it anyway).

In Virginia, tobacco became so valuable that it replaced coins (which were in short supply) as the main medium of exchange. Everything from debts, wages and taxes were paid for in tobacco, while warehouses stuffed with the leaves became de facto reserve banks. Even the governor’s salary was calculated on the price of tobacco.

The colonists became fixated with growing the crop – so much so that farmers had to be forced to grow food. Immigration rose and slaves were brought in from Africa, swelling the exportation of tobacco to Europe from ten tons in 1619 to 750 tons by 1639. In that time, the price plummeted from 27 pence per pound to just three.

The colonial authorities panicked. Yield restrictions were imposed, and the leaves were subject to quality controls. Yet, the price of tobacco plunged so far that it became no longer economical to grow it. In January 1639, half of the tobacco crop was ordered to be destroyed.

But it was to no avail. To the north, Maryland had since sprung up as a competitor, and with its more diversified economy, it was better able to weather the storm. Virginia was condemned to suffer years of economic depression.

Also on this day

6 January 1873: Crédit Mobilier of America scandal investigated

On this day in 1873, the US House of Representatives launched an investigation into the scandal surrounding the building of the Union Pacific Railroad. Read more here.