Ships of Oak, Guns of Iron:

The War of 1812 and the Forging of the American Navy – by Ronald D. Utt

Read the article in the Cayman Financial Review Magazine 

In what year did the United States become a world power? Arguably it was in 1814, two hundred years ago. In 1814, the US already had the highest per capita income and one of the largest territories of any country, a mid-sized population of eight million – significant for countries of the time; and it had taken on Great Britain, the military and economic superpower of the day, and fought it to a stalemate on the land and sea. 

The War of 1812 is better remembered in Canada than in the US or Britain, because Canada was the clear winner in that it was no longer under constant threat of being taken over by the United States. Neither the US or Britain was a clear winner or loser. Neither country gained or lost territory or significantly improved its pre-war positions. The American Indians, mostly having sided with the British, were the clear losers, being abandoned both on the field and in the final peace treaty.

Ronald Utt, a noted economist who has been fascinated by the War of 1812 and particularly by the role of the US Navy, has written a first-rate naval history.1 Utt has the ability to describe the battles so vividly that you can easily picture in your mind what is happening. Like a good adventure story, he draws you in so that you feel the tension of each battle.

The US has historically succeeded, partly from its overconfidence, only to be whacked back to reality with a quick return to overconfidence. In June 1812, with great hubris, the US declared war on Great Britain, the superpower of the day. Britain, deeply involved with its battles with Napoleon, resented US trade with France.

Britain had a difficult time obtaining enough sailors to serve on their naval and merchant fleets. America was already prosperous for the time, and merchant seaman in the American fleet were much better paid than the British and usually had better working conditions. As a result, many British seamen left the British merchant marine for American vessels. Even worse for the British was the frequent desertion of sailors from the Navy, with many joining the America merchant marine. This caused the British to stop American merchant ships to look for deserters from the British Navy (or merchant marine) and “impress” them back into service for the British.

The impressment actions of the British caused great resentment in America. This was long before countries issued passports and restricted immigration. In fact, the US was actively trying to attract European immigrants. If a British seaman moved to the US with the intention of becoming an American and then obtained a job in the US merchant marine after having renounced his British citizenship, what right did the British have to seize him? The British need for sailors was so great that at times they even seized seamen who had been born in America. These actions by the British caused a rising anger in the US.

In addition, the British actively interfered and attempted to block US trade with the French. The Americans also resented the British for supplying weapons and other aid to American Indians on the frontier. This fuelled additional conflict between settlers moving west and the Indians. All of these insults finally caused President Madison and Congress to declare war on the British.

The Americans believed that they could quickly seize Canada and drive the British out of North America. The initial invasions of Canada resulted in disaster because the American troops were both poorly trained and poorly led. The British believed that they were invincible at sea because the Americans only had a tiny fleet of eight ships, versus several hundred for the British. Yet, the American ships were for the most part bigger, better built, and more technologically advanced for the time than the British ships. And much to the surprise of the British, several of the early naval battles resulted in American victories.

The Americans sought to overcome their numerical disadvantage by supplying “Letters of Marque” to those who would outfit private ships for war against the British. Such vessels were known as “privateers”. As Utt explains, in one instance an investment consortium of Baltimore merchants, “supplied the ship and hired a crew with the expectation of great profits from the sale of British ships and cargo – 1.3 million dollars’ worth, as it turned out – that Rossie would seize on her voyage.”

The ship’s captain “was one of the estimated 150, armed ‘letter of marque’ privateers who set sail against the British in the first two months of the war.” Utt goes on to note: “A British merchant vessel was ten times more likely to be attacked by a privateer than by a ship of the navy during the war.” Utt adds that: “Over the next two and half years, more than 500 privateers would set sail from American coastal ports in pursuit of British shipping. Capturing an estimated 1,500 to 2,500 of the enemy’s merchant vessels, they prodded both nations towards peace talks.”

The British were totally surprised by the success of the American privateers. Largely in response, they also ramped up their use of privateers, who quickly caused considerable losses in the US merchant fleet. After the initial American success with the privateers, the editors of the British Statesman warned, in part, “The Americans will be found to be a different sort of enemy by the sea than the French. They possess nautical knowledge, with equal enterprise to ourselves. They will be found attempting deeds which a Frenchman would never think of; and they will have all the ports of the enemy open, which they can make their retreat and their booty.”

Privateers gradually fell out of favour after the War of 1812, but the debate about the use of private military contractors continues even today. Now, military contractors usually receive a fixed fee for their services rather than a share of the booty. At the time of the American Revolution and War of 1812, it was common for even members of the uniformed military to receive bonuses for successes. In 1814, the British, having exiled Napoleon to Elba, focused their attention on the US by attempting several invasions.

One attempt was for the British Army to drive south from Montreal and proceed down the Hudson River valley. The goal was to go by water from Lake Champlain on. But again, the British were shocked when American Commandant Thomas Macdonough led his squadron to victory over the British at Plattsburgh Bay, thus ending the invasion attempt. Macdonough became a national hero and a wealthy man. “The final tally of the British squadron was $329,000 of which Macdonough was to receive $22,807 – the largest single day’s prize awarded during the War of 1812. He received a gold medal from Congress, 1000 acres of land in Cayuga County New York, and 100 acres of Cumberland Head from Vermont. He was also given valuable keepsakes by other cities and states. In one month, he said, “from a poor lieutenant I became a rich man”.

In August 1814, a British invasion force entered the Chesapeake Bay and marched on Washington. They stayed one night, burned the Capitol and the White House, and then proceeded on to Baltimore where they were defeated. In January 1815, General Andrew Jackson overwhelmingly defeated the last British invasion force in New Orleans. Unknown to Jackson and the British commanders, a peace treaty between the US and Britain had already been signed in Ghent, Flanders.

Despite its inconclusive outcome, the War really created the American national identity and took away the remaining impediments for a rapid expansion westward. It also served as the training ground for a new generation of American political and military leaders.

Ron Utt has written a fast-paced and lively five hundred page history, which is both entertaining and informative, about a little known but important war. After reading the book, one is struck about how little we have learned. The US declared war on a stronger foe, with misconceptions about what its own military could accomplish, and without a clear-cut exit strategy.

The two sides agreed to peace terms because of the financial toll the war was taking on both nations and the rising unpopularity of the war on both sides of the Atlantic. Ships of Oak, Guns of Iron is a fine book to read during your summer vacation, particularly if you are near the water and can look out and imagine great battles of two centuries past.



1 Ronald D. Utt, “Ships of Oak, Guns of Iron: The War of 1812 and the Forging of the American Navy,” MIT Press, Regnery, 2012.



Previous articleDistressed LBOs and fraudulent conveyances:
Next articleAdam Lebor’s “Tower of Basel”
Richard W. Rahn

Richard W. Rahn is Chairman of Improbable Success Productions, Chairman of the Institute for Global Economic Growth, and a former Member of the Board (2002-08) of the Cayman Islands Monetary Authority.

Richard W. Rahn, Ph.D.
Institute for Global Economic Growth
PO Box 2100
Reston, VA 20195 USA

T.+1 (703) 338 9439, +1 (703) 553 3700
E. [email protected] 



The Institute for Global Economic Growth (IGEG) was formed in 2002 to assist both governments and economic policy organizations in developing and promoting pro-economic growth policies. It is a non-profit (IRS code – 501-C-4) organization.

IGEG provides highly experienced and world class experts from the United States and other countries to assist government officials who are interested in identifying and correcting impediments to economic growth in their own countries. IGEG experts have had senior level experience in monetary, tax, spending, trade, privatization, and regulatory policies and, therefore, are capable of evaluating an entire economy or a subset, such as the financial sector, depending upon the need.

IGEG also provides assistance to economic policy organizations (think tanks) throughout the world. It assists such organizations with policy development, (e.g., programs in tax competition), organizational and financial development, communications strategy, and provides speakers for conferences. IGEG also helps develop coalitions of like minded organizations to improve economic policy making within or among countries, depending upon the issue. IGEG publishes little in its own name, but prefers to aid scholars who publish for their principal organizations.

In Europe, IGEG works closely with its affiliate, the European Coalition for Economic Growth, based in Vienna, Austria. In order to minimize overhead costs, IGEG only contracts for the necessary personnel and experts for the time and location where they are needed, rather than maintaining a large staff. Its experts are drawn from leading American think tanks such as the Cato Institute, The Heritage Foundation, The American Enterprise Institute (AEI), the Competitive Enterprise Institute (CEI), the Institute for Research in the Economics of Taxation (IRET), the American Council for Capital Formation (ACCF), the Center for Freedom and Prosperity, the Small Business & Entrepreneurship Council (SBE Council), and others. IGEG also draws experts from universities, the private sector and think tanks located outside of the U.S.


Institute for Global Economic Growth
PO Box 2100
Reston, VA 20195

T.+1 (703) 338 9439, +1 (703) 553 3700
E. [email protected]