Nutmeg, grown in the Banda Islands in the East Indies, was an incredibly valuable spice in Europe.

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Did the Dutch really trade Manhattan for nutmeg?

The race was on during the 15th century's Age of Exploration. In the Middle Ages, Europeans imported spices and other valuables from the East via land trading routes that extended through the Middle East. However, in 1453, the Ottoman sultan Mehmed II launched a two-month siege that was successful in taking over the Byzantine capital city of Constantinople. He then blocked Europeans from accessing traditional trade routes. This drove European powers to find alternate outlets.

In the subsequent scramble for sea routes, two watershed moments particularly stand out: when Christopher Columbus stumbled on America in 1492, and when Vasco da Gama rounded the Cape of Good Hope to reach India in 1497. After da Gama returned with a ship teeming with spices, it helped solidify Portugal's dominant position as the unrivaled European trading power in the East throughout the 16th century.

However, by the beginning of the 17th century, both the Dutch and the British broke into the Eastern trade business and emerged as forces to be reckoned with. The Dutch were the first major threat to the Portuguese with their Vereenigde Oost-indische Compagnie (VOC, Dutch East India Company). Their British rivals trailed at first, but their East India Company (EIC) slowly became more powerful.

Meanwhile, both the Dutch and British had their eyes on the West as well -- there was money to be made off the valuable fur trade there. Although their exploits in the East and West seem to have little to do with each other, the two trading powers clashed in both places. As a result, land was swapped, fortunes reversed and fates changed in surprising ways.

One of the most fascinating tales of this era has to do with the island of Manhattan, which changed hands rather flippantly. Interestingly, no one even lived there until the Dutch sought control of it. Ultimately, the fate of this future metropolis hinged on the spice we sprinkle atop our Christmas eggnog: nutmeg.

Peter Minuit offers an American Indian chief trinkets worth about 60 guilders in exchange for the island of Manhattan.

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The Manhattan Deal

After the English explorer Henry Hudson fruitlessly sought a Northeast Passage to Asia via the Arctic Ocean, the Vereenigde Oost-indische Compagnie (VOC) contracted him to search for a Northwest Passage to Asia through North America in 1609. Hudson didn't find a Northwest Passage, but he did find Long Island, Manhattan and a river that would later bear his name.

Hudson claimed the land for the VOC, which revved up fur trading in the area in the ensuing decades. The States-General of Netherlands then formed the Dutch West India Company in 1621 to colonize the land, by this time known as New Netherland.

Peter Minuit, the VOC's director-general, came to New Netherland in 1626 to broker a deal with the American Indians, who occasionally used the land to hunt and fish. In exchange for the island of Manhattan, Minuit offered the tribe a chest of beads and other trinkets worth 60 guilders. In the 19th century, this amount was famously estimated to be about $24; however, that number is disputed [source: Axelrod]. If we assume that the Dutch bought Manhattan for a few cents an acre, it would be a steal comparable to the United States' purchases of Alaska or the Louisiana Territory. On the other hand, it seems like a raw deal for the American Indians. But many historians point out that the Dutch are the ones who got conned. The American Indians didn't have the same sense of land ownership as the Dutch did. They didn't even live on the island, which they called "Manahachtanienk," meaning, "place where we all got drunk" [source: McVeigh]. When Dutch settlers brought liquor to the island, they offered it to the American Indians they found there. Because American Indians had no history of alcohol use, the liquor had a significant effect on them.

In any case, the American Indians accepted payment for land they didn't consider theirs. And it should be noted that the Dutch offering payment at all was a sign of good faith to legitimize their claims, especially compared to the Spanish conquistadors who opted simply to take the land they wanted [source: Axelrod].

Even if each party were guilty of treating the other unfairly, the Manhattan deal can still be considered a bargain -- for both sides. But the Dutch didn't keep Manhattan for long.

Jan Pieterszoon-Coen was a ruthless commander in the VOC who ruled the local populations with an iron fist.

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The Fight for Nutmeg

The scramble for land in North America was tame compared to the violent power struggles in the East Indies. European powers were vying for control of the spice trade, and the valuable spice at the center of it all was nutmeg.

The Europeans valued nutmeg for more than its distinct taste. Nutmeg was considered an aphrodisiac and hallucinogen. People even wore bags of the spice around their necks as a protection against the Black Plague. It may sound like superstition, but it's plausible that nutmeg actually repelled fleas that carried plague-causing bacteria [source: Le Couteur]. Nutmeg was so highly coveted that European traders were selling it at nearly a 6,000 percent markup [source: Weir].

Nutmeg is indigenous to the volcanic soils of the Banda Islands, a group of islands in Indonesia. To get their hands on nutmeg, the Portuguese annexed these islands in 1512. But in the 17th century, the Portuguese lost their grip on this side of the world. The VOC expelled its Portuguese rivals and subsequently attempted to enforce a monopoly on nutmeg. At first, the native Bandanese population considered the Dutch their saviors from Portuguese control. However, relations soon soured.

The Dutch thought they'd secured a monopoly when they established a treaty in 1602 with village chiefs. Yet, many Bandanese nutmeg growers continued selling to other traders. Historians speculate that the Bandanese didn't understand the terms of the Dutch agreement. What's more, the Bandanese relied on bartering nutmeg for food with nearby islands [source: Bernstein]. Regardless, the Dutch felt betrayed and responded with violence against the Bandanese. In addition to a series of skirmishes, the Dutch occasionally launched sweeping attacks that resulted in the destruction of villages, enslavement of natives and executions of chiefs [source: Le Couteur]. After killing thousands of natives -- most of the Bandanese population -- the Dutch imported their own farmers from Holland to take charge of growing nutmeg [source: Lamoureux].

The VOC's struggle to maintain a monopoly on the spice was further complicated by the British, who controlled Run (also known as Pulau Run), one of the smallest of the Banda Islands. It was a fight for control over this island that brings us back to the other island in question: Manhattan.

Bringing Nutmeg West

During the Napoleonic wars of the early 19th century, the British invaded the Banda Islands. Taking lime-free nutmeg with them, they were able to replant it in places like the Caribbean island of Grenada. Grenada is now among the leading producers of the spice, and a nutmeg is featured on the country's flag.

A City for a Spice: The Treaty of Breda

To maintain their monopoly on nutmeg, the Dutch needed to make sure they were the only ones growing it. In an effort to keep people from replanting the nutmeg they sold, the Dutch dipped it in lime, which effectively prevented it from sprouting. But this wasn't the only obstacle to overcome in their nutmeg monopoly. The British were still dabbling in nutmeg trade from their stores on the island of Run. Though small, the island of Run was rife with nutmeg. The EIC had early on secured a successful partnership with its leaders to trade its nutmeg.

Jan Pieterszoon-Coen, the ruthless commander of the VOC was dead set on expelling the British any way he could. Much to his chagrin, however, the VOC and EIC officials back in Europe signed a cooperation agreement in 1619. But Coen decided that if he couldn't have Run's nutmeg, then no one could. In lieu of direct violence against the British, he sneaked on the island when the British left it undefended and burned down all the nutmeg trees [source: Weir]. Finally, in 1666, during the Second Anglo-Dutch war, the VOC took control of Run.

Meanwhile, things weren't going so well for the Dutch in the West. Compared to nutmeg trade in the East, fur trade in New Netherland wasn't as lucrative. To make matters worse, a British fleet had succeeded in taking over New Amsterdam (the Dutch name for Manhattan) in 1664. The 1667 Treaty of Breda allowed the Dutch and British to formally settle their differences. In exchange for official control of Run, the Dutch relinquished their claims to New Amsterdam.

The British weren't very excited about the trade, and they initially tried to pawn it off for valuable sugar-producing lands in South America. As fate would have it, the Dutch didn't agree with this trade, and the British kept the island, later renaming it New York.

Lots More Information

Related HowStuffWorks ArticlesSources
  • "Banda Islands" Encyclopaedia Britannica. 2009. Encyclopaedia Britannica Online.
  • "Hudson, Henry." Encyclopaedia Britannica. 2009. Encyclopaedia Britannica Online.
  • Axelrod, Alan. "The Complete Idiot's Guide to American History." Alpha Books, 2003. (April 9, 2009) http://books.google.com/books?id=prdgVZaIIiAC
  • Bernstein, William J. "A Splendid Exchange." Atlantic Monthly Press, 2008.
  • Carlisle, Rodney P. J Geoffrey Golson. "Colonial America from Settlement to the Revolution." ABC-CLIO, 2006. (April 9, 2009) http://books.google.com/books?id=zpSa8cRSrT0C
  • Lamoureux, Florence. "Indonesia." ABC-CLIO, 2003. (April 9, 2009) http://books.google.com/books?id=nr3DuQKDfRYC
  • Le Couteur, Penny, Jay Burreson. "Napoleon's Buttons: How 17 Molecules Changed History." Penguin Group (USA) Incorporated, 2004.
  • McVeigh, Frank J. "Brief history of social problems: a critical thinking approach." University Press of America, 2004. (April 9, 2009) http://books.google.com/books?id=XKVYJHySS9MC
  • Weir, Stephen. "History's Worst Decisions: And the People who Made Them." Murdoch Books, 2005. (April 9, 2009) http://books.google.com/books?id=QYAc7nHuT5UC