A glimpse into the workings of Cornish Mining Companies- A talk for November

Hope, Luck and a Sprinkling of Underhand Dealings

A talk for the East Cornwall Mining History Association at Luckett

A brief pause in the posts this week to promote my talk for the ECMHA at Luckett village, a village rich in miming history and heritage. 

Luckett Talk Poster

On the 24th of November 2018  I will be giving a talk   on the dealings that went on behind the scenes of 18th Century Cornish mines. An evening that will bring to life many of the words and phrases that fill the pages of newspapers and mine reports of the day, and a talk that will throw some light of what was called the “Cornish System” .  Some come along and enjoy an evening of Tributes and Tuts, Wheals and Winzes.  This is local history with great a plot line!

Click here for the ECMHA website>

The Talk

Some of the talk will be based on my latest publication  “On the Economy of the Mines of Cornwall and Devon 1814 (Annotated): The Cornish System described” , some of it on my other publications, some of it on publications to come, and some of it on the research behind the posts on this blog.

JT cover Front

Click here to see Kindle Edition on Amazon>
Click here for the Paperback Edition on Amazon>

 

 

 

 

 

 

Books on the night

For those looking for a Christmas present then I will have on sale my range of Cornish Mining paperbacks on the night, and for the younger readers Cheryl will have her range of Cornish Legend themed storybooks.

 

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Dodgy practices- Cornish Mine Share trading

Prince of Wales Shaft BuildingsTrading Cornish Mining Shares in the 18th Century

As I prepare for the up and coming talk at Luckett, a village with its own amazing mining heritage, it seemed apt that I should produce a quick summary on the trading of Cornish Mining shares. I have used a publication written by Roger Burt as the main source of information, “The London Mining Exchange 1850 to 1900”.

Click here for extract on Google Books>

Unfortunately the Cornish mining industry of the 19th century was often hindered by the bad reputation it gained as an investment. This reputation was obtained by the actions of the system that was supposed to support it by raising capital.

Cornish mining has always been an industry of extreme fortunes, extremes driven by the unpredictability of the lodes beneath the ground. This was an industry where luck and skill could bring huge wealth of within yards huge losses.

In the 19th century additional factors came into play, the man made factors of  share fraud, and share manipulation. Much of these malpractice s was made possible by the manner in which the mining shares were traded.This was compounded by the change is share structure of many mining companies, a change that brought the shares to a growing market of unwary investors.

The buying and selling of Cornish Mining Shares

In the 18th and 19th Centuries most mining companies excluded from stockWindow at Prince of Wales engine house market instead the shares were  traded by direct contact seller and buyer, or sometimes in the case of large sales by public auction. 

Dealers did not buy and sell on commission, but  Instead bought and sold, and exchanged shares between mines, even buying whole mines. This  business was conducted from their  own offices, on the pavement outside of the stock market or in Royal Exchange. Share issues and sales  were  advertised in the of the mining Journal. Richard Hawke of Liskead for example was a common seller through the pages of the Journal.

As time went on Cost book companies divided their shares to attract more capital.In the mid 1840s most had shares of 256 or less, but 20 years later numbers in thousands. Such division made the shares affordable to a wider range of investors, a wider range of investors that where ripe to be relieved of their money by unscrupulous dealers.

Malpractices flourished

The share dealers direct involvement in mines gave opportunity for malpractice, an Prince of Wales Shaft engine housesopportunity that some took advantage of.

As adventures in the mines they could become involved in their  management would influence activity to maximize share value,  even if it impacted long term working of mines. They often became the mine’s purser or secretary to maximize their ability to direct the activities of the mine.

Some would start  a mine at inflated prospects, collect in share capital from hopeful investors and then take a large slice for their services.  Their aim was not to extract ore from underground,  but to extract money from gullible public’s pockets. Once the mine was formed their influence was still exerted, sometimes they would divert profits to high prestige projects such as grand buildings, and sometimes falsely boost production with the richest parts of  lodes at the expense of the longer term fortune of the mine

The Mining Exchanges

But many honest dealers giving good advice, and some of them attempted from the mid 19th Century more reputable attempted to form place to trade shares, These involved creating  a ‘Mining Exchange’ where mining shares could be bought and sold under regulated conditions, through accredited dealers. Several attempts were made, but each failed, often amid acquisitions  that the exchanges created small cliques that excluded some of the experienced smaller dealers.

The collapse of the Cornish Mining Industry would overtake the attempts to form a widely supported Mining Exchange. This was a collapse hastened by the bad reputation gained by the very malpractices the exchanges were attempting to prevent.

 


Luckett Talk PosterA date for the diary


 

Charles Babbage and Cornish Mines

An up and coming talk based on my Recent John Taylor‘s publication has led me temporarily away from the South Caradon Mine’s post series, but I will return once the talk has been and gone (follow this post for news of the talk). So here is the start of some posts on the Cornish system.

The Cornish System supported

Charles Babbage

Charles Babbage (1791-1871) is best known for his role in the development of what Charles Babbagewould become today’s computers. But Babbage was a  multifaceted genius, he was a mathematician, inventor, philosopher, scientist and astronomer.

One of his influential works  was “On the Economy of Machinery and Manufactures” published in 1832.  A work on which he lays out is ideas on the organisation of manufacturing. The later editions of this work included views on combining the interests of labour and capital  into a system that would be far more effective than the normal employer-employee arrangement. One of the key pieces of evidences supporting his argument was the effectiveness of the system used in Cornish mines, “The Cornish System”.

This post contains a short extract from Babbage’s book, an extract that describes the Cornish System through the eyes of an economic philosopher. The extract has been formatted and re-paragraphed to make easier reading on-line, a change that I suspect Babbage would have enjoyed seeing.

For books about, and by, Charles Babbage-Click here>

On the Economy of Machinery and Manufactures
1832

Extract from Chapter 26 On a New System of Manufacturing

307. In the mines of Cornwall, almost the whole of the operations, both above and below ground, are contracted for. The manner of making the contract is nearly as follows. At the end of every two months, the work which it is proposed to carry on during the next period is marked out. It is of three kinds.

  1. Tutwork, which consists in sinking shafts, driving levels, and making excavations: this is paid for by the fathom in depth, or in length, or by the cubic fathom.
  2. Tribute, which is payment for raising and dressing the ore, by means of a certain part of its value when rendered merchantable. It is this mode of payment which produces such admirable effects. The miners, who are to be paid in proportion to the richness of the vein, and the quantity of metal extracted from it, naturally become quick-sighted in the discovery of ore, and in estimating its value; and it is their interest to avail themselves of every improvement that can bring it more cheaply to market.
  3. Dressing. The ‘Tributors’, who dig and dress the ore, can seldom afford to dress the coarser parts of what they raise, at their contract price; this portion, therefore, is again let out to other persons, who agree to dress it at an advanced price.

The lots of ore to be dressed, and the works to be carried on, having been marked out some days before, and having been examined by the men, a kind of auction is held by the captains of the mine, in which each lot is put up, and bid for by different gangs of men. The work is then offered, at a price usually below that bid at the auction, to the lowest bidder, who rarely declines it at the rate proposed.

The tribute is a certain sum out of every twenty shillings’ worth of ore raised, and may vary from threepence to fourteen or fifteen shillings. The rate of earnings in tribute is very uncertain: if a vein, which was poor when taken, becomes rich, the men earn money rapidly; and instances have occurred in which each miner of a gang has gained a hundred pounds in the two months. These extraordinary cases, are, perhaps, of more advantage to the owners of the mine than even to the men; for whilst the skill and industry of the workmen are greatly stimulated, the owner himself always derives still greater advantage from the improvement of the vein.

This system has been introduced, by Mr Taylor, into the lead mines of Flintshire, into those at Skipton in Yorkshire, and into some of the copper mines of Cumberland; and it is desirable that it should become general, because no other mode of payment affords to the workmen a measure of success so directly proportioned to the industry, the integrity, and the talent, which they exert.

NOTES:
1. For a detailed account of the method of working the Cornish mines, see a paper of Mr John Taylor’s Transactions of the Geological Society, vol. ii, p. 309.


JT cover FrontJohn Taylor’s account reprinted

The Paper mentioned by Babbage is available in paperback or Kindle format.

Click here for paperback on Amazon>

Click here for Kindle>

 

John Taylor, mining genius- An index of posts

Navsbooks>John Taylor>Index of Posts

Now that the Trevithick Society talk is over, it is a chance to pull together the various posts used during its preparation in a list. So if you have a desire to find out more about this 19th century mining genius- here is a few ideas. john_taylor_civil_engineer.jpg

Ten facts about John Taylor

John Taylor- Key Dates

John Taylor- The forgotten hero of Norwich

Wheal Friendship the mine that made John Taylor 

John Taylor and the Tavistock Mines

John Taylor and the Halkyn MinesBeam

The Copper crusher-John Taylor’s most important invention

The Cornish system beyond the Tamar

JoUnitedShaftPanhn Taylor and the Consolidated Mine

John Taylor a quick mine list

Cornish Engines Consolidated, Taylor and Woolf

Taylor’s Railway- The Redruth and Chacewater

On the economy of mines in Cornwall and
Devon

Lean’s reporter-John Taylor and some layers of history


 

The Cornish system beyond the Tamar

Navsbooks>John Taylor> The Cornish System
screenshot_2016-03-04-18-29-12_kindlephoto-5847512.jpg

In the 21st century the word ‘Cornish’ is a strong brand in the food industry. Pasties, cheeses, cream, ice cream, biscuits, cakes, fish, tea, coffee, cauliflower, wine, beer, gin and cider are the many products benefiting from the prefix.

In the 19th century however, it was the hard rock mining industry that had fallen in love with the prefix; Cornish stamps, Cornish engine, Cornish stamps, Cornish Rolls, the list is long.  Alongside this technology though was a term with a more vague meaning, the  ‘Cornish System’.

This ‘Cornish System’ formed a major part of John Taylor’s success. It was the implementation of this system to mines outside of Devon and Cornwall that gave him a critical financial advantage over his competitors.John_Taylor_(civil_engineer)

Taylor did not transplant all of the system to his mines, he only used the parts that suited him best. The two key elements he used were the cost book company structure, and the workforce payment system.

Cost book companies
When Taylor reached the financial position to be enable him to enter the realm of mine ownership, cost book companies became his preferred method of company structure.

Cost book companies were a historic and simple form of financial institution that had developed from the needs of the early medieval tin streamers. In theory, they could only legally be used within the Cornish and Devon Stannaries’ jurisdictions, but this legal detail did not prevent Taylor from setting them up in many other parts of Britain.

The key features of cost book companies were:

  • The names of the investors (adventurers) and the mines financial transactions are entered in a cost book.
  • At the end of each accounting period all profits are divided between the adventurers according to their shareholding.
  • All money required to develop the mine and continue operating is to be obtained from the sales of ore.
  • If sales do not meet these costs a ‘call is to be made on the adventurers, who will then be required to make a payment to the mine according to their shareholding.
  • The mine cannot hold a cash reserve, or borrow from external sources.

Investors in cost book companies could not just sit back and allow the money to role in. Mines often spent many years demanding money from their adventurers before the reward of profits occurred, and the majority of the adventures would never reach profitability.wpid-wp-1438633784339.jpeg

Despite of its apparent short-comings when applied to large industrial scale operations, the cost book system suited Taylor very well. By restricting the number of shares it enabled him to maintain a tight control of the companies and allowed for quick changes in strategy. The lack of capital reserve and external borrowing was not a restriction to Taylor, who was extremely skilled at managing the balance between ore being sold, broken ore underground awaiting hauling to the surface and the development of new potential ore reserves. He treated the broken ore laying in the stopes as his bank, solid capital to be called on when required.

The payment and management of the workforce
This was a system based on a method of self-employment, with two classes of miners, those paid on work completed (tut workers), and those paid as a share of the value of the ore raised (tribute).

The process rwpid-th-5.jpegevolved around the act of setting, when the work was auctioned to the miners. On the large rich mines this must have been an impressive spectacle, with the miners gathered around the grand frontage of a count house waiting to determine their future chances of fortune or poverty.

Taylor considered that the system was an effective in maximising profits and enabling efficient management. Once the work had been set, large parts of the mines operations became self-managing. Miners and the mine owners shared the common aims of producing saleable ore at low cost, and this alignment of aims resulted in a system that was stated by Charles Babbage as :

“no other mode of payment affords to the workmen a measure of success so directly proportioned to the industry, the integrity, and the talent, which they exert”.

It was not a system without its weaknesses. One important one was its influence of the infrastructure on the mine.  The efficiency of ground working it stimulated often left a complex of shafts, winzes and tunnels not suited to modern methods being demanded in the latter half of the 19th century. Critics also accused the system of encouraging unsafe practices, with the miners willing to take more risks when driven by the desire for higher payments.

To sum up in a few easy words...
A genius from Norwich used traditional Cornish methods he first learnt in Devon to modernise mines in the rest of Britain. History is never simple.

I can still find no trace of recognition of his achievements in his town of birth. Various libraries, tourist information offices, record libraries and museums have helped in the hunt, but it appears he his the genius the town chooses to ignore.

The nextwpid-screenshot_2015-08-21-17-43-45.png post will send the blog back west to Cornwall, and will reverse the grammatical emphasis.

If you wish to explore the life of another character in the Cornish mining industry then read The Last Great Cornish Engineer.

Or download a copy of  Sketch of the life of William West C.E. of Tredenham-The last of the great Cornish Engineers