The Bidding Battle

As explained in Chapter 3, one of the main duties of the Nablus Council was to oversee the bidding process on and disposal of taxes collected in kind that were stored in government-operated storehouses in Nablus and Jenin. Merchants from outside Nablus were free to participate in the bidding process, and, theoretically, these commodities were to be sold to the highest bidder. From the point of view of the council, the participation of regional and foreign merchants—based mostly in the coastal cities of Beirut, Acre, or Jaffa—had two negative effects: it raised the prices of these commodities, and it lowered the quantities available for local trade and manufacturing. This, in turn, encouraged peasants to hold out for higher prices and forced merchants, manufacturers, and artisans to compete more intensely with each other for supplies.

The soap producers and merchants of Nablus, therefore, were threatened with losing first rights to oil and other commodities collected as taxes-in-kind and, potentially, of having their access and control of the surplus of Jabal Nablus seriously undermined. These concerns, not principled opposition to Ottoman rule, spurred them to challenge some, but not all, of the new administrative rules and regulations. Because the council members were also soap merchants and manufacturers, they resorted to various means in order to restrict the bidding process over olive oil and tried to keep prices low. They waged a polite and indirect but stubborn campaign against repeated efforts by the central government to maintain an open and effective bidding process. The Ottoman government, in contrast, was keen to promote free bidding. High prices meant more money for its coffers, a stronger hold over the networks of trade, expanded access to the agricultural surplus in the various regions, and, not least, a window of opportunity for provincial governors and administrators to build patronage networks and make money by favoring certain bidders against others.

The opening salvo of the major battle over olive oil was fired in late March 1852, when the council members responded to an inquiry by Hafiz Pasha, the governor of Jerusalem, about the amount of oil collected in kind, when it would be sold, and to whom:

Of the 1267 [1851–1852] dues, 2,745 uqqas of oil have been collected thus far.…Your Noble Command was issued that it be put up for auction and the bids sent to you…as is known and famous in the city of Nablus, the local government (miri) does not have its own wells to store the oil collected. Rather, it is an old tradition that [the oil] be put in one of the merchants’ soap-factory wells. Because the oil is collected both at the beginning and the end of the year, it is well known that it precipitates and cannot be taken out in the same pure state that it entered in. So if it is put on auction now and someone bids on it, he would want it in the same pure state as the merchants who ship it overseas are accustomed to taking it. Therefore the cloudy part that filtered down will stay as the property of the oil-well owner and the amount of oil [sold] will be less [than what was brought in]. Either way, both the soap-factory owner and the miri will be cheated. Because the oil has already been deposited with Sayyid Mahmud Fakhr al-Din, it should be sold to him. This way, it does not have to change hands and it will not be necessary to sell only the clear oil, leaving behind the cloudy [part]. Because the aforementioned cooks soap in his soap factory, it is immaterial to him whether the cloudy [part] mixes in with the clear [part], for that does not hurt the production of soap.…[Furthermore,] this way we would not have to pay a fee for storing the oil, nor the expenses of measurers and lifters or any other costs.…We asked about the price of oil in these parts…and found that each uqqa is worth 3.5 piasters.…If the Noble Order sanctions this sale, we will collect the price from the aforementioned buyer and enter it into the treasury account books.^[128]

It is of crucial significance that the council cited both traditional practices and new economic circumstances to explain why open bidding, from their point of view, was impossible. They could easily have rented space for storing the oil or built, at the central government’s expense, public well(s) over the years—but this would not have been in their own interests. Rather, they seized on tradition as a defense in order to reinforce their role as the interpreters of local realities—a point that was discussed in Chapter 4. They were well aware that the Ottoman government had long recognized previous customs as a legitimate precedent in a variety of circumstances (such as in land-tenure cases). Indeed, the central government’s respect for the precedent of custom was synonymous with the autonomy that had been enjoyed by Jabal Nablus over the preceding centuries.

In addition to the argument of tradition, they cited the exigencies of international trade in oil to justify why it was not cost effective to export oil already deposited in private wells. In essence, therefore, the council members asserted their control over the bidding process by the very act of depositing oil in one of the soap-factory wells and then presenting the provincial governor with a fait accompli: no matter who was chosen, it would always have to be one of the Nablus soap-factory owners because tradition dictated that their wells be used to store the oil.

The Jerusalem governor, unhappy about the lack of choice in the matter, insisted that the oil be put on auction anyway. He also ordered that the council provide full information on the bids and send him the money as soon as taxes-in-kind were sold to the highest bidder. The council members, however, still had some tricks up their sleeves. On April 30, 1852, they wrote a letter offering three other bids.^[129] All three, however, came from soap-factory owners in Nablus, and all three offered a lower price than the original bid. In other words, more bids amounted to less choice, unless Hafiz Pasha was willing to accept an even lower price.

The explanations the council members gave are very instructive, in that they took refuge in a newly invented tradition: fluctuations in prices caused by international trade. They noted that most Nablus soap-factory owners refused to bid because 3.5 piasters per uqqa was too high now. This amount reflected the price of oil two months earlier, when international demand for oil through Haifa and Jaffa ports was at its peak. International oil merchants had since loaded the ships, and local soap merchants had secured their supplies. With the slackening of demand, the price of oil dropped to its normal level.

The council members reinforced their arguments by displaying the greater freedom for maneuver afforded by their knowledge of the specificities of local customs and conditions. They noted that the oil merchants were no longer as interested in bidding because, after selling the clear oil, they had enough of the cloudy part left over to cook soap with—hence they no longer needed more oil for this season’s soap production. The important point, whether the statement was true or not, was that the local soap-factory owners alone knew the actual situation.

To reinforce their subtle threats they announced that whoever bought the oil must buy it complete and pay the rent and other expenses. They reduced the governor’s room for maneuvering even further by concluding that Sayyid Mahmud Fakhr al-Din had decided to withdraw his bid and that he no longer cared who bought the oil as long as his storage costs were reimbursed. The best they could come up with, therefore, was yet another Nablus soap-factory owner, Sayyid Ahmad son of Hajj As‘ad al-Tahir, who was willing to pay 3.25 piasters per uqqa as well as all of the other expenses. Most likely, this new offer—which was one-quarter of a piaster per uqqa lower than the previous one—was not a serious one. Rather, it was a bargaining chip to push through the original candidate without conceding anything.

The governor of Jerusalem must have construed their purpose in this light, for he fired back an angry missive in record time, lecturing the council that his intent in ordering that the oil be put on auction was “not to reduce the price, but to increase it” and stating that the second offer was “unacceptable.”^[130] He further insisted that the council give the greatest consideration to having a real auction and report on the results as soon as possible.

Somewhat akin to a chess game, the council members returned to their old position, but only after securing another concession. On May 11, 1852, they sent a note assuring the governor that he should not doubt their sincerity.^[131] Far from attempting to manipulate the price of oil or to keep it artificially low, they reiterated, it was forces larger than themselves, namely supply and demand for oil on the international market, that drove the price down. Second, if they were to have a real auction now, its price might slide downward even further. Therefore, and in order to dispel any misgivings about their motivations, they announced the happy news that they had managed to convince Sayyid Mahmud Fakhr al-Din to resubmit his original offer, but they had to promise him in return that he could postpone payment for four months instead of paying immediately, as the governor had requested.

It must have become obvious to Hafiz Pasha that securing a higher price for the oil through the council was hopeless. Nablus was not only ruled by native sons, but all of the council members happened to be soap-factory owners to boot. In this particular situation, they were in a very strong position to control the bidding process on olive oil collected as taxes-in-kind. Therefore, he personally searched for outside bidders, settling on a Beiruti merchant who was willing to pay a mere 5 fiddas, or one-eighth of a piaster, more per uqqa than the candidate picked by the council. Immediately afterward he sent a letter demanding that the oil be surrendered to this merchant forthwith.^[132] To rub salt into the wound, he even retracted his previous demand for immediate payment and ordered that the Beiruti merchant be given the same four months’ grace period as Sayyid Mahmud Fakhr al-Din demanded. He specifically commanded, moreover, that the Beiruti merchant not be made to pay any of the storage and other costs. The last order sought sweet revenge, for it aimed at embarrassing the council members, on the one hand, and at forcing Sayyid Mahmud Fakhr al-Din to bear these expenses, on the other.

It was the council’s turn to become angry and bare its teeth for the first time. In a pointed response dated June 24, 1852, it gave a number of reasons why it flatly refused to sell the oil to the Beiruti merchant.^[133] First, it noted that the governor had not answered its last letter within twenty days, as he had promised, so it had assumed agreement on his part. Second, the oil had already been sold and used to cook soap. The reason was that part of the oil-well wall had collapsed, so the sale to Sayyid Mahmud Fakhr al-Din had to be finalized immediately or else the cost of moving the oil to another well would have had to be borne by the treasury. Third, it would be unacceptable in any case that the service charges on storage and other expenses not be reimbursed, and the council could not sell oil under such conditions.

To make sure that all of the possible avenues for counterattack by Hafiz Pasha were closed, the council members went on to accuse the Beiruti merchant of attempted bribery. They claimed this merchant, during a visit to Nablus, noted the empty well and threatened to outbid Sayyid Mahmud Fakhr al-Din unless he received a bribe. In other words, even if the oil were still available, they could not possibly approve its sale to such an unethical merchant. Finally, slamming the door shut, they complained that too many letters had been written and too much time had been spent on this matter. They threatened that if such methods were employed in the future, Nablus soap-factory owners would simply refuse to store the olive oil collected as taxes-in-kind in their wells. To sweeten this blatant refusal and threat, they announced that they had managed to force their candidate to add the 5 fiddas to the original price and declared the matter closed.

This stubborn and united opposition by the council members, it must be emphasized, was not motivated by the amount of olive oil at stake. That was worth approximately 10,000 piasters—a large but relatively insignificant sum compared with the millions of piasters sunk into soap production every year. Neither was this battle motivated principally by the possibility of personal gain: council members did not stand to make an immediate and direct profit on these bids, because the entire amount would be transferred to the central treasury. Rather, they cared deeply about the outcome of the bidding process because it was, in essence, a political struggle between the central government and the local council over control of the price and movement of the rural surplus, the major source of income for both sides.

Members of the council, it must be emphasized, were not simply government representatives. They were also soap-factory owners, local businessmen, and regional traders who had a direct financial stake in who bought what and for how much, as well as a political stake in maintaining their primacy over a hinterland they considered to be theirs, not the government’s or the foreign merchants’. A crucial factor in this regard was keeping the central government in the dark about how much of each commodity was produced, where, and through what channels it was moved to its final destination. If the central government were allowed to dominate the bidding process, it would eventually be privy to the full range of information about the productive capacity of Jabal Nablus and the business connections of its merchants. Eventually, the hundreds of leaks feeding local middlemen at the expense of government revenue would be plugged up, and the material base of the merchant community would be narrowed considerably.

These were not theoretical concerns. For example, the above scenario was precisely the trap that council members found themselves in when they tried to convince the governor of Jerusalem to allow the peasants of Jenin district to pay cash for that part of their taxes that was normally collected in kind. Instead of flatly agreeing or refusing, the governor cleverly pursued the matter by demanding to know why the request was made, what villages were affected, the kind and amount of commodities they produced over the years, the range of prices offered, and so on. After a long series of evasive letters, the council members finally backtracked on their original request and practically begged that the case be closed.^[134]