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The Barbary Pirates Ver3
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The Barbary Pirates Ver3

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PPT based upon Barbary Pirates Case involving two former US presidents.

PPT based upon Barbary Pirates Case involving two former US presidents.

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Transcript

  • 1. The Barbary Pirates
    Abhishek
    Anshuman
    Rajul
    Sharad
    Srinivas
    Suket
    1
  • 2. End of 18th Century
    USA has no Navy Fleet
    No Protection from British
    Economy Improving
    Debt Still There
    2
  • 3. Year: 1786, The NegotiatorsJohn Adams Thomas Jefferson
    USA Ambassador to France
    Against Peace with Pirates
    ToNegotiate with Barbary States
    Leading USA Diplomat to UK
    Wants to set up Naval Fleet
    To Negotiatewith Barbary States
    For Peace with Pirates
    Againstsetting up the fleet
    3
  • 4. Adams Says War Is Costlier than Peace
    Potential Trade Revenue Loss
    More than (500,000 ) £ per year
    Option 1: Peace
    Cost 200,000 to 500,000
    As 10,000 to 30,000 annual interest considered @ 6%
    Option 2: Prepare & Go for War
    At least 500,000 even when no fight
    200,000 to 500,000 additional if fight
    Assumed as one time cost!
    This is recurring cost.
    Assumed as recurring cost!
    This is one time cost.
    Not Apple to Apple Comparison
    4
  • 5. Jefferson ArguesBuilding Fleet is Must &not that Costly
    Assumed as one time cost.
    Not used for comparison.
    Splits costs of war
    Fixed vs. Variable
    Fleet Set Up cost – 450,000
    MUST be done anyway
    Additional Cost – 22,500 per year
    As half the fleet kept in service
    Only variable costs should be compared
    Cost to Fight not considered.
    Only maintenance taken.
    Cost of WarNOT Considered.
    5
  • 6. Our Calculation
    Cost of Peace
    200,000 to 500,000 annual (recurring)
    350,000 Average annual (recurring)
    Cost of War
    450,000 one time fleet set up (FC)
    22,500 to 45,000 maintenance every year (recurring)
    350,000 whenever fight (recurring with probability of war)
    One win may decimate pirates for many years
    6
  • 7. Our Take
    Set up Fleet
    One time cost of 450,000
    Maintenance cost of up to 45,000
    Go for war once
    350,000 average
    Reduce bargaining power of Pirates
    Settle for peace
    200,000 per year or less maybe
    7
  • 8. This was 1786.What Happened Thereafter?
    War?
    Peace?
    Adams? Jefferson?
    8
  • 9. Jefferson Stuck to His Argument
    Paying ransom
    NOT a sustainable solution
    Barbarian states
    MUST feel the threat
    9
  • 10. Navy Gets Formed
    With some delay
    In 1794
    With 6 battle carriers
    10
  • 11. John Adams?
    BecomesPRESIDENT of USA
    In 1797
    Remains till 1801
    And Keeps on paying
    The Ransom every year
    11
  • 12. 12
    Jefferson
    USA President
    1801-09
  • 13. Jefferson Stops Ransom Payment
    Refuses Tripoli’s demand
    of an immediate payment
    of $225,000
    and
    an annual payment
    of $25,000
    13
  • 14. Initiates War with Pirates
    Orders NAVY to move & initiates WAR
    Alliance of Barbary states breaks
    1st War ends in 1805
    Ransom of 60,000 per sailor continues
    2nd War held in 1815
    No ransom thereafter!
    14
  • 15. Thank You !!!
    15