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The Life of Contract Capitalism and the Building of the Colonial Railway

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Arun Kumar discusses that capitalism relies on contracts, which are state-led legal regimes that guarantee free exchange of goods and property rights.

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This video video is a transcription of a presentation discussing a contribution to an edited volume titled "The Imperial Underbelly." The speaker focuses on their piece called "The Life of Contract Capitalism," which examines the evolution of colonial capitalism in the late 19th to early 20th century, highlighting the case of Joseph Stevens, a Scandinavian contractor in India during the 1860s. Stevens made significant wealth by building railways and later returned to Sweden to marry into an aristocratic family. The speaker analyzes the broader relationship between contract capitalism and labor, noting that contracts historically provided stability in economic transactions but have also been critiqued as instruments of inequality under capitalism. They discuss how contracts evolved to be viewed as agreements between equal parties, despite the unequal power dynamics often present, which critics, drawing from Marxian perspectives, argue reinforces bourgeois authority. The context of contracts in colonial India is particularly highlighted, where laws criminalized breaches by workers but not by employers, reflecting an inherent imbalance. The speaker emphasizes the importance of examining actual contracts from Stevens' archives, showcasing how they reveal the practical implications and mistrust underlying these agreements. The contracts not only serve as tools for binding workers but also highlight a punitive approach towards labor, underscoring the exploitative nature of colonial labor regimes. Overall, the text seeks to shed light on the complexities of contract law and its implications for labor relations in colonial contexts, calling for a reevaluation of how contracts are understood in relation to power dynamics and historical narratives in India.

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X-TIMESTAMP-MAP:LOCAL=00:00:00.000,MPEGTS=900000

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This piece of writing actually is a part

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of an edited volume, which has been done by gun

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called the Imperial Underbelly.

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And, I've written a piece in that called The Life

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of Contract Capitalism.

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This book,

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and broadly my piece, what it does is

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that it talks about how

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colonial capitalism evolves in the late 90th

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and early 20th century.

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Uh, the idea is to think through this.

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So via a person called, Joseph Stevens,

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who's a Scandinavian guy who goes to India in the 1860s

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to build railways.

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And he's, he's nothing.

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He's, he's a 19-year-old guy,

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basically a middle class guy whose father is a professor at,

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at Danish University in Denmark.

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And, this profess, this professor's son, he goes

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to India, and, he makes lots of money billing railways,

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as a contractor,

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and then returns back to India, in the, in the 1870s,

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and, gets a lot of money and buys a state

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and marries to an aristocratic family, goes

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to Swedish parliament and becomes this aristocratic naab.

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So it is like the classic example of this,

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British officials, life who, basically these guys,

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who went to India and, and made rich,

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and return back to England to, to have a very, lavish

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and aristocratic life.

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So this is basically a Swedish, counterpart,

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to these British, officials.

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Now, what I'm trying to do in this piece is basically

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to think of the relationship between contract capitalism

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and, labor.

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And what I'm trying to say in that book,

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and in that piece, is to think, that

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how the ideas of contract,

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and contract work evolves in the 19th century.

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Now, when we think of contract, all

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of us have some understanding of contract

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because we do sign different kinds of contracts,

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in our lives.

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We sign rental contracts with our landlords.

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We sign contracts with banks.

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Uh, most importantly, we sign contracts

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with our employers, right?

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So we have some understanding of contract.

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But, what is it, what is the history of the contract

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and what is it specific history in relations to capitalism?

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Now, contract has been there always in the history,

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that we know for sure.

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And these contracts were probably not necessarily,

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workers' contract, or contract between employers

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and employees, but they, there were contracts between,

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different entities, re regulating services, delivery

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of services, delivery of things.

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So, contract in that sense, fulfills a very prominent role,

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in the business life, that is to ensure,

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safe delivery of things, trusted transaction,

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that could be an economic transaction

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or a transaction of things.

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Um, so in a way, it kind of brings stability

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to the business, right?

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For a long time, this idea of contract,

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was there.

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But during the capitalism, what happens is that it gives,

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it gets a new life.

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And what is that new life is that it is seen as in kind

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of this harger of bringing equality between people.

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And, I'm, I'm referring here, a context which,

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which is kind of happening in a, in a, in a very,

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charged situation, that there is slavery, outside

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of the British Empire, sorry,

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within the British Empire,

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but outside of England, or France.

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Uh, but there is also this idea of enlightenment,

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individuality after the French Revolution, the idea

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that people have their own rational thoughts

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and, people are individual, beings,

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and they should be able to kind of freely interact.

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And precisely, this is the moment when scholars,

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or, thinkers like Adam Smiths are writing their work on,

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free, free, waste capitalism.

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Now, what contract kind of adds to this,

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historical context, is

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that it becomes an entity in facilitating

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that a liberal understanding of, of, of our word,

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or liberal understanding of capitalism.

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If you can say more precisely, what I mean by that is that

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people thought that contract is basically a contract

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between two equal entities or two free individuals.

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And in that sense, it brings, on the one hand the issue

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of rationality and individuality.

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On the other hand, it kind of also results many

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of the complex processes of,

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or issues of classical political economy that is free wage,

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labor of free exchange of goods and, and money.

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And what happens is that contracts gets embedded in,

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in economic transactions in the life of, of the state.

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But there's also kind of a critique

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that simultaneously gets developed of the contract.

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And this critique emerges more strongly, in the, in the,

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in the writings of the legal,

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its scholar called Critical Legal, its scholar.

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And they started saying that

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these contexts do not necessarily

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Refer or produce a free, or equal regimes.

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And these contacts are not necessarily

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between equal parties.

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Rather, what we see is that there is one unequal party,

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and then there is, more kind

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of a powerful party on the other side.

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What they said they said was basically they were drawing

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upon Marxian understanding.

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Uh, and Karl Marx had a very, strong kind

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of understanding about capitalism, which basically he said

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that it's, unequal

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and, it is, it produces violence,

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it produces, its own doubt.

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So he basically said that capitalism is like,

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basically filled with, with blood

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and dirt from, from head to toe.

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And he also kind of critiqued contracts

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because he said that in a way it reestablished the authority

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of the bourgeois people, the middle class

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or the rich, employer class,

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because they wanted

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to have an instrument which allowed a kind of a business,

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but people who were actually entering into the contracts

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with them, they were not necessarily free workers

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or free people, rather, they were, kind of produced,

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in a, in a very un unfree manner.

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And he gives examples of, of various types

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of labor regimes.

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Now, what happens with this kind

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of critical legal scholarship is that that idea,

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that benign idea, that contract is a

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and transaction between the two free individual party,

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it gets started kind of questioning, and,

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and it pro it started kind of producing its own kind

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of fizzes,

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and we start seeing that how, how could the,

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like a worker who is earning, probably one pound a day

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and, an employer who's earning,

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or who's making profit of thousand pounds a day,

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how they are kind of equal,

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but most importantly the equal, is there an equality

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of social, kind of class.

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Uh, so that is that, if there is a worker who's kind of,

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very poor, but also socially despised.

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And then there is this rich property money class,

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which is like a cultural capital in the background.

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So are these kind of,

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relationships are happening in a kind of a, in an equal

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way as the kind of contract,

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makes it out to appear like that.

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So my work kind of situates in that kind of debate.

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And, it kind of pulls out

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that debates into the Indian context.

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Uh, and it talks, through this guy Joseph Stevens,

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who signed a number of contracts with Indian workers.

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Joseph Stevens is a very kind of interesting guy.

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Um, he arrives India in the 1860s.

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And the 1860s is a period,

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of profound legal controversies in India.

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Um, so there are British officials on the one side,

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who wants to criminalize, all breaches of contract

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between a master that is mostly kind of employer

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or British officials, or Europeans and Indian workers.

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So they were saying that any breach

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would result in the penal, prosecution

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of the worker.

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So, for example, if a worker refused to do work,

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they could be sent to jail.

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If a domestic servant, stole something from the house,

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they would be sent to jail.

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If a worker did not come to work, they could be sent

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to a few months of jail.

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Now, on the one side of the British official was kind

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of this very, dangerous argument.

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On the other hand, there was also kind

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of equally dangerous kind of, argument that was coming.

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Uh, and that side was saying that we should,

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not kinda penalize all aspects of breaches of the contract,

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but only the fraudulent behavior.

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That is, if a worker has taken

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an advance from a employer

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and then refuses to work, then in that case

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that criminalization should be there

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and the worker could be sent to jail for three months.

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Now, what's so interesting in these, legal debates is

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that there is no reflection on the other side.

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So there is a criminalization of the work and worker,

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but there is no criminalization

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of the master or the employer.

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So let's say, for example, if a master refuses

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to pay the wage of a worker, there is no criminalization.

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So the master could pay the damage,

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but could not go to the jail

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practically, through the law.

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So in a way, it kind of protected the master,

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but kind of made worker kind of a criminal, in the cases

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of breach.

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Now, what's so interesting about Joseph Stevens is

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that when he arrives in India,

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these legal controversies are happening,

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and there is an act which is already passed in 1859,

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and, Joseph Stevens starts working from 18 62, 63.

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Now, what this act of 1859,

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which was basically a workers breach,

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con contract act, was

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that it basically criminalized the fraudulent behavior,

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the practice of taking advance.

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Now, the problem, with this act was

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that it was only implemented in presidency towns.

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That is cities like the big cities like Calta,

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Madras, or Bombay.

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But people like Joseph Stevens,

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they were working in the hinterland, the rural areas,

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where the railways were still kind of expanding.

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Uh, Joseph was there to build railways in the cotton belt

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because the American Civil War had happened,

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and there is a kind of a problem of supply of cotton.

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So they were looking India as a market,

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and, basically railway was like the savior

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for the British kind of industry, which will kind

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of bring the cotton into the global market.

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Um, so the problem with this act was

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that it could not be kind of extended to the rural areas,

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and it, it didn't serve the purpose.

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So in 1860, a new act is kind of brought out,

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and that act, is called, workers Dispute act.

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And that, law basically was predominantly

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for the railway itself,

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and that included people who delivered services of people

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who, provided raw material to, to, to contractors

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or ingenious, and it kind of

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criminalized their behavior.

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So suppose if I'm a stone man

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and I want to provide a stone to a contractor, let's say,

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of, of one quintel of stone,

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and I failed to kind of provide that in a,

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in a time delivery, then I am basically,

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and I've taken the money for it.

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I am basically a fraudulent worker,

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and I could be penalized, for three months.

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What's so interesting about Joseph Stevens, is

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that Joseph Steven is unable to kind of use the law

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as much as we have thought about.

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And the Indian scholarship on

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contract law has been mainly focusing on the law aspect.

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We never had real contracts, in the picture.

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So for the first time, we get a contract,

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how it looked like,

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and that we get from Joseph Stevens archive,

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which is in Sweden, and that's what I studied.

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So what we see is

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that Joseph Steven is not necessarily relying on the law

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aspect, but on the contract itself as a way

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to bind his workers.

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Now, how does he bind, his workers?

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Uh, it's something that we can further discuss on,

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but interestingly, wherever,

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the law did not reach,

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and, I want to give you an example from America,

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because, there was a lot of production, of, of,

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agricultural crops, especially was done by slaves

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and ex-slaves in America,

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and it was mostly in the hinterland.

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So Robert Steinfeld, he studied, this,

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regimes of labor, and he said

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that wherever law was not reachable,

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employers relied on punitive measures,

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basically on economic punitive me measures.

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So basically, punitive measures in a way

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that they would ask for damages from people

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who not deliver things or who would stop working.

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So Joseph, Steven is precisely doing the same thing.

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So you, you have like a kind of a similarity between India

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and America in the spirit, in the, in,

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in the way these employers are overcoming the problem of,

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workers defiance

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or workers, unwillingness to kind of, to, to, to,

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to deliver the things

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that they probably at one point promised, right?

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Uh, we can talk more about, the nature

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of the contract if you're interested in that.

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But what's so interesting about this kind of,

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Joseph Steven story is that he brings in the contract,

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in picture the, so we can see, we can read the languages

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of the contract, we can see who are the workers

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with whom he's signing for a long time.

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The Indian scholarship, only talked about

15:30.665 --> 15:32.205
how law is unequal.

15:32.225 --> 15:36.245
The contract law is unequal, between, employer

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and, employees, how it protected the Boozer class

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or the European, officials or planters or,

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or Indian, manufacturers.

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But it is not kinda in way protecting the worker as such.

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But for the first time, we see the contract

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and we find a new angle to that story.

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And that angle to the story is

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that imprisonment is just one aspect of, how

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to kind of bind the worker.

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The contract, the document itself is, is a way

16:05.565 --> 16:08.285
to kinda bind, bind, the worker themself.

16:08.345 --> 16:11.005
And that is to also kind of punish the worker,

16:11.585 --> 16:13.205
not necessarily by imprisoning them,

16:13.205 --> 16:16.565
but also kinda by leaving fines, by withholding wages

16:16.665 --> 16:17.965
and also cetera, et cetera.

16:18.185 --> 16:19.645
How is Stephen Defense not kind

16:19.645 --> 16:23.325
of necessarily relying on the law aspect of, of contracts,

16:23.545 --> 16:25.845
but rather the contract and the document itself?

16:27.105 --> 16:30.205
Now, the kind of contracts that I've looked in,

16:30.205 --> 16:33.885
Joseph Stevens archive, they are of,

16:34.195 --> 16:35.245
different degrees.

16:35.945 --> 16:40.245
Uh, they range from 1862 to 18, 69,

16:41.065 --> 16:45.485
and he signs a range of documents with,

16:45.665 --> 16:46.845
different types of workers.

16:47.025 --> 16:51.525
So he, for example, he signs, contracts with the workers

16:51.865 --> 16:55.445
who perform labor at his, construction site

16:55.445 --> 16:58.805
that is building of the buildings or railway fencing

16:58.945 --> 17:00.565
or, railway tracks.

17:01.315 --> 17:04.405
He's also signing contracts with, service providers.

17:04.405 --> 17:08.085
So people who provided, masonry work, people who

17:08.325 --> 17:09.965
provided stones, people who

17:10.205 --> 17:13.925
provided him, lime, limestone, people who

17:14.205 --> 17:15.365
provided, wood.

17:16.605 --> 17:19.105
So he's kind of contracting with a number

17:19.105 --> 17:20.945
of various types of stakeholders.

17:21.085 --> 17:25.185
And all of these stakeholders would come under this 1860,

17:25.565 --> 17:29.705
workman's dispute act, which basically was meant for,

17:30.165 --> 17:32.105
for, for the, for the railway,

17:32.135 --> 17:33.305
work and railway services.

17:33.685 --> 17:37.465
And it was kind of, in a way, it, it was,

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an act which criminalized, the, the behavior,

17:42.245 --> 17:45.425
the criminal be what, quote unquote, criminal behavior

17:45.685 --> 17:47.625
of the worker if they intended

17:47.765 --> 17:49.285
to not perform what they promised.

17:49.825 --> 17:51.365
But what's so interesting,

17:51.425 --> 17:55.925
and, what's, very useful for historians,

17:55.985 --> 17:57.965
of capitalism, of labor

17:58.425 --> 18:00.565
and of colonialism, is to see

18:00.865 --> 18:03.725
how Joseph Stevens is writing contracts very carefully

18:03.775 --> 18:05.125
every day with his workers.

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So, for example, I'll give you

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how these contracts look like.

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So you'll sign a, a contract with the worker X and B,

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and saying that you two people provide 50 workmen with,

18:18.675 --> 18:20.325
with me, with, with you.

18:20.825 --> 18:23.325
And I need this labor from this date to this date.

18:24.545 --> 18:27.045
But if you fail to provide,

18:28.085 --> 18:32.605
I have the authority to, take money

18:32.905 --> 18:34.245
as a damage from you.

18:35.025 --> 18:36.085
So,

18:36.225 --> 18:38.405
and now we are talking about a very, like, kind

18:38.405 --> 18:40.725
of a limited labor market where,

18:40.785 --> 18:42.165
the railways are expanding.

18:42.165 --> 18:46.045
In this particular area, there is a great labor demand

18:46.045 --> 18:47.525
and there is a lot of competition.

18:47.545 --> 18:51.045
But then these workers and their, their workmen

18:51.105 --> 18:53.765
or headmen of the workers are kind of dealing

18:53.765 --> 18:55.205
with a very few employers,

18:55.705 --> 18:59.005
and they're also kind of deal, they're also writing,

18:59.485 --> 19:01.965
references to these workers, like if the character

19:01.965 --> 19:03.525
of the worker is good or not.

19:03.785 --> 19:05.045
Uh, and on that basis,

19:05.045 --> 19:07.765
they would get work from other employers in future.

19:08.345 --> 19:11.805
So Stevens, for example, would, make these kind

19:11.805 --> 19:14.725
of extra kind of cautionary, extra caution.

19:15.185 --> 19:19.205
Um, in, in the contracts, in other kind of contracts,

19:19.205 --> 19:22.565
he would say that, okay, I've given you a hundred,

19:22.665 --> 19:25.625
rupees as an advance,

19:25.765 --> 19:30.465
but if you fail to, deliver the service in time,

19:31.165 --> 19:33.385
you will have to pay, this

19:33.385 --> 19:35.825
and this much amount of damage, right?

19:36.615 --> 19:39.745
Then in other sorts of contracts, he will say

19:39.745 --> 19:43.585
that we will not, provide you work in future.

19:43.685 --> 19:48.065
So it kind of, or we will not give you your wages,

19:48.245 --> 19:49.945
or for the work that you already done.

19:49.965 --> 19:53.145
So suppose if a worker has contracted something

19:53.145 --> 19:55.705
to do something and they've done only parts of,

19:55.805 --> 19:57.785
so usually the wages would be settled

19:57.875 --> 19:59.985
after like a month, right?

20:00.285 --> 20:03.665
So the, so he said that we will be, I would basically

20:04.185 --> 20:07.345
withhold your wages if you do not perform the services

20:07.535 --> 20:09.665
according to my likes.

20:10.365 --> 20:12.865
Now Steve, we have to understand Joseph Stevens also,

20:12.865 --> 20:17.265
Joseph Stevens is an employee of the British,

20:17.375 --> 20:18.785
this, GIPR,

20:18.785 --> 20:21.105
which is great India Peninsula railway company.

20:21.485 --> 20:23.345
And he has to deliver his services

20:23.365 --> 20:25.705
to this company who's building railways on behalf

20:25.705 --> 20:28.425
of the British, colonial government in India.

20:29.045 --> 20:31.905
So what we find then is that he's using

20:33.425 --> 20:38.145
contract itself to ensure, a service for himself,

20:38.605 --> 20:41.025
which is reliable, which is trustworthy.

20:41.525 --> 20:45.745
But what's so interesting about these contracts and

20:45.885 --> 20:49.325
and the language of the contract is this mistrust about

20:49.325 --> 20:52.485
Indian workers, this mistrust about the,

20:52.585 --> 20:55.005
the assumed dishonesty of worker.

20:55.275 --> 20:58.885
That the worker is a don dishonest person, quote unquote.

20:59.265 --> 21:02.605
Now, this is something that is shared widely in the 90th

21:02.605 --> 21:05.725
century, across spectrum in

21:05.905 --> 21:10.605
and across cultures by employers, that it is believed

21:10.635 --> 21:13.605
that the worker is going to basically do pure,

21:14.465 --> 21:16.725
and one has to ensure that

21:18.475 --> 21:23.395
contracts should be able to recover the damage in a way,

21:23.425 --> 21:27.515
that it doesn't do much financial damage to the employer

21:27.615 --> 21:29.355
or to the service, provider.

21:29.855 --> 21:32.235
Now, it is interesting to see,

21:32.345 --> 21:34.995
that law is working on one hand

21:35.765 --> 21:37.465
and then the contract as a document

21:37.725 --> 21:40.785
of which the laws is supposed to kind of protect, is working

21:40.805 --> 21:42.945
as in another kind of institution.

21:42.965 --> 21:45.505
So on the one hand, the law is an institution.

21:45.505 --> 21:47.985
On the other hand, contract is an institution.

21:48.565 --> 21:50.465
So we see until now,

21:50.885 --> 21:53.505
the scholarship has focused on the law aspect,

21:53.935 --> 21:56.105
whether the critical legal scholarship

21:56.105 --> 21:58.985
that I referred in the, in my first answer,

21:58.985 --> 22:01.185
that critic critical legal scholarship

22:01.205 --> 22:04.105
or even Indian labor history, which talked about unfree,

22:04.155 --> 22:07.585
labor regimes focused on how laws were unequal,

22:08.005 --> 22:10.545
but they didn't look at the language of the contract,

22:10.545 --> 22:11.545
the actual documents,

22:11.545 --> 22:15.225
because those documents were never found in the Indian,

22:15.985 --> 22:17.345
archives or Indian history.

22:17.685 --> 22:20.025
And one of the famous scholars of,

22:20.105 --> 22:21.905
Indian railway history, Ian care,

22:22.485 --> 22:24.265
he basically lemons the fact that

22:24.445 --> 22:28.545
how Indian history has been divided off, contracts.

22:28.545 --> 22:30.585
And it would have been such a wonderful thing

22:30.775 --> 22:32.705
that if we had contracts to look at.

22:33.045 --> 22:34.865
And what Joseph Steven does is

22:34.865 --> 22:37.705
that he provides those contracts to, to Indian scholars

22:37.765 --> 22:41.105
to chart new tenants of history, and history writing.

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