Old Whiskey Rebellion and Modern Tea Party

During the Whiskey Rebellion of old, irate Western Pennsylvanians burned down the house of George Washington’s appointed tax collector, General John Neville.  This wasn’t without provocation, of course.  The bonfire started after one of Neville’s federal marshals shot and killed an unarmed tax protester.  Lesson to the feds:  Be careful who you shoot, especially when they can shoot back.

The recent Pittsburgh Tea Party was far less inflammatory, although some of the issues and basic sentiments are much the same as those of the 1790s.  The original Whiskey rebels opposed a distant and aloof government that reflected the interests of an East Coast cultural aristocracy.  Despite the personal popularity of George Washington, his federal government was imperial and out of touch.  To answer a summons in federal court, for example, a Western Pennsylvania farmer had to trek near 300 miles across the mountains to Philadelphia.  And the lack of a useful national currency – one of the key functions of any government — handicapped economic growth.  In fact, for lack of real money on the western frontier, people used whiskey as a form of currency.

The final straw came in 1792 when Treasury Secretary Alexander Hamilton proposed raising revenue by taxing the capacity of stills.  And in those days, stills were no mere means of making recreational moonshine.  By 1794, the draconian collection of Mr. Hamilton’s new tax placed at risk the ability of farmers to transform their surplus grain into more transportable and saleable whiskey.

In other words, the whiskey tax damaged the farm economy, which was about all there was west of the Alleghenies.  Inept government economic and monetary policy placed the future at risk.  Thus did many citizens rebel.  And rightfully so, some say.

Rooted in Citizen Anger and Frustration

What’s behind the modern “Tea Party” sentiment?  I believe that it’s rooted in citizen anger and frustration that the federal government just spends and spends and spends, with no evident heed for tomorrow.

The justification for heedless increases in government spending – even worse, increased spending with borrowed money — is along the lines of Pres. Franklin Roosevelt’s famous comment that “If we borrow funds, then we owe it to ourselves.”  The modern justification, as a Federal Reserve official once explained to me, is that “As long as we can afford to pay the interest on the debt, it’ll be OK.”

But the people are not blind, let alone stupid.  It is clear that the federal debt just grows and grows.  How much longer can this last?   Today many informed citizens understand that the national debt is way too big.  The rate of growth is out of control.  We don’t “owe it to ourselves.”  We owe it to the Chinese, the Japanese, the Middle Easterners.  And we cannot afford to pay the interest anymore.  Well, not if we want to be able to do anything else as a nation except work like tax-slaves to pay interest on past debt.

By any technical measure, the federal government is insolvent — except for that quaint custom of inflating the currency with fiat dollars.  So really, the nation is long overdue for a national discussion on the fundamental nature of its money.  Hence the Tea Parties.

The Pittsburgh Tea Party Crowd

In Pittsburgh a crowd of several thousand (estimates range from 2,500 to 5,000) formed last week in the city’s old, historic Market Square.  Market Square dates to the 1700s, and perhaps the bedrock still recalls the events from the days of George Washington.  The mid-April weather was characteristically lousy, with drizzle and rain falling in 50-degree temperatures.  If you were there, it was because you wanted to be there.

The Tea Party attendees struck me as a cross section of Western Pennsylvanians.  There were many Steelers jackets, and ball-caps with military logos and veteran patches.  I asked around, and met business owners and office workers, factory workers, lawyers, health care providers, restaurant workers, and a few people who are, as they put it, “between jobs.”  There were off-duty cops and firefighters, courthouse employees, bus drivers and even a few bikers resplendent in their leather and tattoos.

The Tea Party brought out the creative side of attendees as well, with people dressed in Colonial period costumes.  To my observation, it was an orderly and respectful crowd, filled with sincere people who appeared to know their American history.  My gut feeling was that the Tea Party attendees understood why they were out standing in the cold rain.  (One 30-something woman told me, “I’ve never been to a political rally in my life.  But I’m just scared for the country’s future.  We’re going to be broke.”)

The makeup of the crowd was young and old, men and women.  There were retirees (as indicated by their hats and T-shirts), middle-aged people, and young people complete with pink hair and metal in their ears.  There were parents with children.  (One participant told me, “I brought my son with me because I want him to remember this day.  I think we’re at the beginning of something that’s going to change the country.”)  There were white and black, Asian and Indians.

Many Tea Party attendees carried signs, all apparently homemade.  The verbiage ranged across a conservative to libertarian political spectrum.  Some signs were historical, with deep roots in the 1913 coup d’etat of American Progressivism under Pres. Woodrow Wilson.  (“The Fed is Illegitimate.” and “Abolish the 17th Amendment.”)  You don’t see many signs like that these days, that’s for sure.

Other signs were rock-ribbed statements of protest about taxes and spending.  (“Give me Liberty, Don’t Give Me Debt.” and “Born Free, Taxed Beyond the Grave.” and “Abolish the IRS, Support the Fair Tax.”  and “Wall Street Banks Got Billions, and All I Got Was This Lousy Sign.”)

Other signs – not many — knocked Pres. Obama; but I would not characterize the Tea Party as just an anti-Obama rally.  There were indications of deeper dissatisfaction with the federal government, at a systemic level.  One sign knocked the “Bush-Obama Ripoff.”  Other signs were along the lines of “Abolish Congress,” which is not exactly realistic, considering the wording of the U.S. Constitution.  (Vote the bums out, maybe?)

One sign hit on the corruption of the process of governance, stating, “Big Fraud from Little ACORN Grows.”  These were not the usual mass-produced, “union-label” signs that you see at those “other” kinds of political rallies.  I’m sure you get the idea.

The Tea Party Organization

The 2009 Pittsburgh Tea Party was organized by a suburban housewife, albeit one with an MBA from the Harvard Business School.  From what I heard, a few politicians volunteered to speak.  The terse reply from the organizers was along the lines of, “No, this is where the people will speak.  You politicians need to shut up and listen.”

There was no indication that the Tea Party was an “Astroturf” event.  The Tea Party received almost ZERO media coverage in the days leading up to it.  It had all the markings of a “flash rally,” organized on the Internet.  The local talk radio guys scarcely mentioned it, to my knowledge.  (If they did, I missed it.)  The local newspapers gave no advance publicity.  The local TV stations were too busy covering the usual pabulum about car crashes and house fires.  If it doesn’t bleed, it doesn’t lead.

It seemed to me that the attendees of the Pittsburgh Tea Party were there of their own volition.  I sensed no mind-control from the evil Fox-News Network, and I wasn’t even wearing my radio-blocking aluminum skull-cap.  Contrary to the defamatory stereotype pushed by the incompetent mainstream media (the LA Times characterized Tea Party attendees as “insane”), the Tea Party people seemed to be decent folk, able to think for themselves and form independent opinions.  And many Tea Partiers have apparently formed the opinion that the federal government is spending the country into ruin.  To those of us who follow the issue, it’s a valid point.

The Tea Party Festivities

The Tea Party stage was decked out with flags.  Festivities began with a musical mixture of patriotic tunes and Country-Western music.  The Tea Party kicked off with a brief welcome from the organizers, followed by a moment of silence in memory of three Pittsburgh police officers who were killed in the line of duty a couple weeks ago.  Then a prayer.  Then the Pledge of Allegiance.  Then the national anthem.  In other words, it was as patriotic as the 4th of July.  Nothing radical.

The first speaker discussed the ever-expanding federal budget.  If you’ve seen the movie I.O.U.S.A., produced by Addison Wiggin of Agora Financial, then it was nothing new except that this was a Tea Party protest in downtown Pittsburgh.  And criticizing federal spending in downtown Pittsburgh is not something that happens very often.

Another speaker gave a spirited history lesson about the origins of the Federal Reserve.  It was Creature from Jeckyll Island-kind of stuff.  It was surprising (to me) how much of the discussion the crowd appeared to understand.  It was astonishing, really.  I think that most of the Federal Reserve scholars in town must have been in the audience, because people seemed to know exactly what the guy was talking about.

A third speaker gave a solid speech about the evils of ever-expanding government.  This guy is a multi-millionaire who built his own nationally-ranked high-tech business and made a fortune.  He’s met a few payrolls in his career.  He discussed the exploding levels of federal expenditures.  He hit on the ballooning national debt, and asked rhetorically how the nation ever intends to pay just the interest, let alone the principal.

And so it went, with more speakers giving talks along the same lines.

The Hecklers in the Crowd

Of course, a few hecklers showed up to make noise.  While one of the early speakers was discussing how federal borrowing is crowding out private investment, a group of five (I counted them) people started to chant, “O-Bam-A!  O-Bam-A!  O-Bam-A!”

At first, the crowd ignored the hecklers.  Then the hecklers realized that they were having no effect, so they yelled louder.  Eventually, it was kind of hard to hear the speaker.  A few members of the Tea Party crowd turned to the hecklers and told them to shut up, have some respect, etc.  That was like throwing kerosene on a fire.  Now the hecklers were hollering at the top of their lungs.

There were a few TV cameramen from local stations covering the event.  Needless to say, the camera-guys rushed over to film the hecklers in action.  By now the five hecklers were having a great time, yelling and making enough noise to disrupt the proceedings.  Then some Pittsburgh cops and event organizers walked over to tell the hecklers to keep it down.

The cops must have said something, because the hecklers broke up and started walking around the edge of the Tea Party crowd, yelling epithets like, “You’re all racists.  You can’t deal with a black man in the White House.”  To which a black guy standing next to me said, “I’ll bet these punks are ACORN activists.”  He turned and talked right at one of the hecklers, saying, “Why are you causing a disturbance?  Get out of here.  Go home to your mama.”  So the heckler called the black guy an “Oreo,” as well as a few other words that I thought were banned from modern vocabulary.  Then a Pittsburgh cop walked up to the heckler and politely asked him to “move along, unless you have some other reason to be here.”  Pittsburgh’s finest.

Media Coverage

The local media gave almost no coverage to the Pittsburgh Tea Party.  The TV stations focused on the hockey playoffs between the Pittsburgh Penguins and the Philadelphia Flyers.  One station ran a short, insubstantial fluff piece, with plenty of attention to the five hecklers.

The Pittsburgh Post-Gazette, located three blocks from Market Square, buried its next-day coverage within a critical, anti-Tea Party story distributed by the Washington Post.  The photo on the inside pages of the Post-Gazette was from a Tea Party in Cincinnati.  On its editorial page, the Post-Gazette ran an insulting cartoon by the predictable and pedestrian Rob Rogers.  The cartoon showed three raw-looking, hirsute men sitting around a table, sipping tea and bellyaching (get it?  Tea Party?)  Meanwhile, the circulation of the Post-Gazette is falling and the newspaper is laying off staff.  Gee, I wonder why people don’t bother to read the Post-Gazette?

What Were the Tea Parties About?

But it’s not just the Pittsburgh Post-Gazette that’s missing the boat.  The talking-head androids of Big Media also missed the point of the Tea Parties.  To the extent that there is any remotely accurate reportage going on, the focus seems to be that the Tea Parties are well-off people bitching about high taxes.  Even the Gallup Poll organization took the bait, publishing a recent report stating:

“A new Gallup Poll finds 48% of Americans saying the amount of federal income taxes they pay is “about right,” with 46% saying “too high” — one of the most positive assessments Gallup has measured since 1956. Typically, a majority of Americans say their taxes are too high, and relatively few say their taxes are too low.

But focusing on the level of taxation is the wrong issue for Gallup to track.  It struck me that the Tea Party attendees in Pittsburgh were worried more about the use of their tax dollars, and the explosion in federal deficit spending.  The Tea Party movement strikes me as more about the dangerously growing size of the federal government.  From what I could gather, the Tea Party attendees opposed the unalterable trend of endless federal growth.  And coupled with this there is, of course, a deep fear about the eventual decline in value of the dollar.

Like I said earlier in the article, it’s about time for the U.S. to have a national discussion about the nature of its money.  What is a U.S. dollar any more?  Where does national wealth come from?  We ought have that national chat while we still have some money, and while we can still create wealth.  Because a lot of people appear to sense that something important is coming to an end.

And when things fall apart, we’ll be in for a generation or two of very tough times.  So the political class, and its Big Media androids, are ignoring the Tea Party movement at their peril.

Until we meet again,
Byron King

April 22, 2009

The Pittsburgh Tea Party was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

THIS COULD VERY well have been the Province of Westsylvania, part of British Imperial Canada. To the east, along a line of demarcation that follows the northeasterly arc of the Alleghenies, would be what was left of the United States of America, a collection of small, Northeastern coastal states that rely for survival on their wits as traders and seafaring merchants. To the south would be the Confederated States, an amalgamation of political jurisdictions that had long ago seceded from the failed Constitutional Compact of 1789. To the west of this spot would be the very large Province of Ohio, another jurisdiction of Canada, extending all the way to the Mississippi River. Abutting the west bank of the mighty Father of Waters would lie the French Department of Louisiana. West and southwest of the French possession would be the United States of Mexico, extending across the high plains and Rocky Mountains to the Pacific Ocean and bordering Canada to the north. Mexico would encompass the territory of Texas and extend far down through the old land of the Aztecs and well into the lands of the lost Maya.

Yes, indeed, things could be very different. Except that Mr. Alexander Hamilton, first Secretary of the Treasury of the United States, levied a tax on whiskey.

If you taste the whiskey first, it helps to understand (and at the end of this article, I will tell you how to do just that…). Dark amber in color, not unlike some varieties of that fine Pennsylvania crude oil that seeps from the cracks in the Devonian shale and Carboniferous sandstone that make up the bedrock in these parts, the whiskey has a dry taste and is certainly not to be confused with those better-advertised, rather fruity beverages that are but sweetened imitations of the real thing. Pennsylvania rye whiskey goes down straight and warm, not quite bypassing the taste buds, but it hits you hard from the inside out. In its own inimitable way, this whiskey is rough and strong and uncompromising, like the men who first distilled it on the western frontiers of the British Empire in North America in the 1700s. In 1768 one man of the cloth called it “a perfect beverage, and a blessing from God for which people would take to arms.” He was prescient, this pastor. In retrospect, the rye whiskey of the western frontier was a beverage that defined a fresh-born nation. And if nothing else, the whiskey and those who consumed it forced the nascent government of the United States to govern wisely, and even to issue honest money. Well, at least for a while.

The Whiskey Rebellion: A Staple of the Frontier Economy

Brewed and fermented spirits were a staple of the frontier economy of colonial America. Beer, for example, was available in almost all households and consumed at almost every meal. Beer-making provided a use for surplus grain, which could not otherwise be transported for sale in distant markets over the primitive roads of the time. Beer was safer to drink than most of the water that one could obtain from wells and streams. Beer had nutritional value, and in a world where most everything was scarce, one did not allow good carbohydrates to go to waste. Thus beer was a routine part of the diet of frontier families and a vital source of nutrition. If it made you feel better during the hard times, that was also a good thing.

Whiskey as well became a staple of frontier life and diet. Like beer, it was made from the surplus grain that was not consumed locally and could not otherwise be transported any great distance for sale. Whiskey served as a medicine, a tonic, and an anesthetic in a time and place where there was no alternative. And distilled whiskey had commercial value, such that it was worth a man’s while to transport it over the mountains, where it sold in Philadelphia for a price in colonial times that was the equivalent of about $25 per gallon today. In an environment in which money was scarce, whiskey not surprisingly became a store of value on the frontier. In western Pennsylvania, one estimate from the 1780s states that there was one still for every 15 residents. People used whiskey to pay bills and local taxes, and even to compensate their schoolteachers and clergy. Hence whiskey evolved into a form of currency in its own right, at least west of the Alleghenies.

The Revolutionary War had left the American national government broke and insolvent, with a reputation for having issued worthless paper currency, called “Continentals. Congress passed laws that forced people to use these notes literally at the point of a soldier’s gun. Inflation and bad debt, both of pandemic proportions, were ruinous to any semblance of a post-Revolutionary national economy. The Articles of Confederation, which lasted from 1777-1789, did little to remedy the sad state of monetary affairs in the young nation. The members of the Constitutional Convention of 1787 were forced of absolute necessity to address monetary affairs. The U.S. Constitution, finally ratified in 1789, specifically made provision for a currency based on gold and silver, as well as for a national bankruptcy law in order to address the oceans of bad debt that permeated every level of colonial society. But it was one thing for the Constitution to declare, as it did, that no “Thing but gold and silver Coin” could be used as legal “Tender in Payment of Debts.” It was quite another for this sovereign edict to become reality.

In the earliest days of the federal government under the new Constitution, Secretary of the Treasury Alexander Hamilton proposed that the national government raise its revenue by levying excise taxes. Among Hamilton’s proposals for raising revenue was a tax on whiskey, that staple of life along the western frontier. For a variety of reasons, this “whiskey tax” immediately aroused the sentiment of many people that the new federal government was simply the replacement of the British King by swindling, moneyed, East Coast speculators and tyrants.

The legislation that enabled the whiskey tax was reflective of the goals of Alexander Hamilton, with his desire to create a strong central government and a nation of industry. The tax placed the levy on the point of distillation, not at the point of sale. Hence many farmers and small-businessmen found themselves taxed on the capacity of their stills, which included the amounts of whiskey they consumed personally, let alone what they discarded due to waste or spoilage. The federal tax rate was lower on larger stills, thus favoring bigger businesses at the expense of small, family-run operations. And the federal tax had to be paid in, of all things, gold or silver coin, of which there were precious few during the best of times on the frontier. As a result, the new tax almost immediately destroyed the value of whiskey as a form of barter currency in its own right. But without whiskey to lubricate the wheels of commerce, the frontier economy soon began to grind to a standstill.

The Whiskey Rebellion: Enforcing the Whiskey Tax

To enforce the whiskey tax, the federal government, then seated in Philadelphia, appointed tax collectors in every region of the country. Aside from a small stipend, the tax collectors’ pay was based on commission, calculated against the total amount of tax collected. Thus, for the most part, when the tax collectors commenced their rounds, riding along the roads and trails of the western frontier to levy tax notices on settlers and their stills, they met the usual resentment that tax collectors have encountered since time immemorial. Tax collectors were often threatened, shot at, beaten up, robbed, or even tarred and feathered. On occasion, the tax collector returned to his homestead and found instead a smoldering ruin. The job of the whiskey tax collector was, to say the least, dangerous and thankless. As a consequence, federal tax collections on whiskey were minimal.

When the whiskey taxes were not paid after collector’s levy, federal marshals were instructed to issue writs of citation against still owners. In Pennsylvania, these writs were answerable within 30 days at the federal court in Philadelphia. For a resident of western Pennsylvania at that time, traveling 280 miles or more to Philadelphia would have required a 10-day ride across difficult, mountainous terrain in the best of circumstances. (On today’s Pennsylvania Turnpike, things have improved marginally.) Due to the difficulty and expense of travel, most federal tax writs went unanswered. Thus the federal court in Philadelphia issued numerous contempt citations against individuals, as well as executions against their stills and other property. The contempt citations often led to citizens being jailed, their property being seized and sold (as often as not, to some out-of-town, swindling, East Coast speculator…), and evictions from their homes, all by federal authorities and in the name of the government of the United States. Thus, it is difficult to overstate the sense of unfairness, the resentment, and the bitterness that many frontier dwellers felt towards the new government.

Within a very short time, it was costing the federal government more to administer the whiskey tax than the government was receiving in revenue. Even worse than the shortfall of revenue, however, was the failure of the new federal government to demonstrate its ability to enforce its tax laws. This was widely perceived, both domestically and abroad, as the beginning of the end of the Constitutional experiment. A number of influential people in western Pennsylvania began to advocate secession from the Commonwealth, as well as from the new federal republic. They proposed to set up a state called “Westsylvania.” Some of the more zealous secession advocates made contact with emissaries from Britain regarding creation of an association with Canada. Others made contact with agents of France, regarding setting up a relationship with that nation’s vast and mostly uncharted Louisiana holdings that included a significant presence in the Ohio Valley. When word of this seditious talk reached President George Washington, he was appalled.

In the spring of 1794, President Washington appointed a man named John Neville as federal tax collector for western Pennsylvania. Neville was a former Revolutionary War general and a close acquaintance of Washington’s. Neville set up his tax office at his family’s farm, just south of Pittsburgh. On July 15, 1794, a group of local residents gathered at Neville’s house to protest the seizure of a neighbor’s property for unpaid whiskey tax. They demanded Neville’s resignation, and also that he turn over his tax records to be burned. Neville’s home was guarded by a unit of federal marshals. After a period of standoff, one of the farmers began to approach Neville’s house under a white flag of truce, and he was shot and killed, presumably by one of the marshals.

Word of the killing rapidly spread, and on July 17, a group of local militia mustered, marched on Neville’s house, and burned it to the ground. Their intent was to deliver some frontier justice to Neville and his “murdering marshals.” Neville and his entourage fled to Old Saint Luke’s Church, on the site of an old British garrison dating back to the days of the French & Indian War, where the pastor offered them sanctuary until the pursuing militia dispersed.

President Washington was outraged at what he considered a personal insult to his old friend and war comrade Neville. Washington and Treasury Secretary Hamilton decided that they had to make an example of these “western insurrectionists.” Washington referred to the burning of Neville’s farm as a “Rogue, unprincipled challenge to authority” and resolved to crack down and bring discipline “to the lower classes of western Pennsylvania.” The area was already well known to Washington from his younger days as a surveyor and from fighting for the British side in the region during the French & Indian War. Also, there was at least a reasonably good road on which troops could march from Philadelphia to Pittsburgh.

The American Army of 1794 hardly merited the name. It had dwindled to a few hundred older veterans of the Revolutionary War, with outdated equipment and next to no supplies on hand. Washington was faced with the need to call out the militia if he was going to impose the federal will on the rebels of western Pennsylvania. Not trusting the reliability of Pennsylvanians, most of the militia called to muster were from Virginia and New Jersey. The Secretary of War was away on family business in Maine, so it fell to Hamilton to organize the expedition. Hamilton, whose tax policies had precipitated the matter, was desperate for success and viewed the confrontation with the whiskey rebels as his personal struggle to stop America from sliding into anarchy and ruin.

President Washington actually led his army of 13,000 troops as they marched west from Philadelphia in August of 1794, the only time in American history that a president has actually served in the role of “commander in chief” in the field. The trek across Pennsylvania took the better part of a month, and many a hotel and tavern was thereafter able to place a sign on the door that “George Washington Slept Here.” The ill discipline, lack of proper equipment, and general lack of military professionalism in the ranks of the militia troops appalled both Washington and Hamilton, the latter a former artillery officer under Washington during the Revolution.

The Whiskey Rebellion: Ending the Rebellion

As Washington’s expedition approached its destination from the mountains to the east, another group of western Pennsylvania militia formed with the intent of attacking Pittsburgh and burning the city in advance of Washington’s arrival. The city fathers, who had made plans for a great civic celebration upon the arrival of Washington, heard of the threat. Thinking fast, they rode out to meet the militia at a place named Braddock Field, the site of a major engagement during the French & Indian War (and now the site of U.S. Steel’s Edgar Thomson Works). In tow, the Pittsburgh men brought many wagons filled with beef, beer, and other victuals that were originally intended for Washington and his army. The Pittsburghers offered the feast to the militia, who enjoyed it thoroughly and thereafter determined that they would not burn the city to the ground. A few days later, Washington’s army marched to the city line, but the militia had dispersed and, lo and behold…few people had any recollection of the identities of the offending rebels. Realizing that the nation was at a political crossroads, President Washington took a magnanimous route and granted a general amnesty to almost all of the insurrectionists.

Today, the Whiskey Rebellion is usually mentioned as a minor event in American history. It is considered by most people, if they have ever even heard of it, as a quaint occurrence long ago, just a footnote in the standard history texts. But the Whiskey Rebellion was actually a defining moment for the United States, and, by implication, for the world. In many respects, it is a period that still resonates today. The Whiskey rebellion raised issues of liberty, peoples’ right of protest, taxation, treason, the use of the militia, and the scope of representative government. The events leading up to, and after, Washington’s march across Pennsylvania in 1794 forced a national debate on the power of the new federal government, including the limitations on the use of that power. Out of it all came a general consensus on the principle of federal supremacy in many fields of national life, among the least of which was to clarify federal power to impose and collect a tax on whiskey.

Post-Whiskey Rebellion, the political life of the nation began to concern itself with the meaning of “perpetual union,” and the implications of the concept. The national memory of the near-dissolution of the young constitutional republic lasted for several generations, until the matter flared again and ignited in 1861. The immediate threat to national expansion that was inherent in discussion of secession, by certain individuals in “Westsylvania” in 1794, prompted an aggressive federal policy favoring westward expansion, fueled by a relatively liberal immigration policy.The lands south of the Great Lakes began to fill up with American immigrants, not Canadians. Within a decade, President Jefferson would purchase the Louisiana Territory from France, and through the explorations of Lewis and Clark (whose boat was constructed on the banks of the Monongahela River, just south of Pittsburgh) America would move the western frontier of the nation to the Pacific Coast. The Whiskey Rebellion started the country on its path to becoming a continental power, and later a world power.

The westward movement of the United States also prompted federal efforts to expend resources on what were called “internal improvements,” both to construct roads, canals and mail routes to the interior, and also to put gold and silver coins into the western frontier economy. Not coincidentally, on October 15, 1794, as Washington’s army was encamped in western Pennsylvania, the U.S. Mint in Philadelphia struck 1,758 silver dollars. These coins were intended to compete with the foreign currencies then circulating freely in the U.S. These “1794 Silvers,” of which only a few are known still to exist, are considered the nation’s first true issue of real money and are all but priceless in today’s numismatic market.

The Whiskey Rebellion framed the debate in early America over the limits to freedom of speech and when such speech would be considered seditious. National divisions over the propriety of the cause of the insurrectionists highlighted philosophical fault lines, along which the first American “political societies” (now called “parties”) were formed. At the same time, the federal government confronted the reality of an armed citizenry and the grudging respect that a large group of like-minded people with guns and ammunition were entitled to be accorded by the sovereign. It is no coincidence that these two issues, speech and guns, had been the focus of the first two Amendments to the U.S. Constitution, in 1791, just a few years before the Whiskey Rebellion.

The need to call out the militia of one state to quell a disturbance in another highlighted the inadequacy of the federal army of that time. It illuminated sectarian fears, in that an army of Virginians was marching through Pennsylvania. (The next time that would occur would be on the march to Gettysburg.) After this episode in 1794, the central government began to build a national military capability based upon a standing army, with an industrial base of armories and associated vendors. The use of federalized militia to enforce police powers and execute the laws also led to a robust debate that has lasted through today. Almost a century after the Whiskey Rebellion, the principle was embodied in the national policy behind the Posse Comitatus Act of 1878.

The sense of unfairness caused by citizens having to travel great distances to confront their government in a federal courthouse led to the establishment of numerous federal District Court jurisdictions, in particular the Western District of Pennsylvania located at Pittsburgh. “Just in case,” President Washington must have been thinking. Incidentally, this philosophy of locating courts near the citizens also led to a national political consensus that state courts should be located near to the people as well, resulting in the development of relatively compact county jurisdictions as the United States expanded to the west. This was a key element in the shaping of an “American” political character, and the development of American participatory democracy. People still say that “All politics is local.”

In today’s world, American taxpayers routinely part with 40-50% of their income in the form of federal, state, and local taxes. It might seem strange to the modern mind that the collection of a tax on whiskey would usher in a defining episode in the history of the United States. But this says more about the loss of national memory of people today than about the political values and motives of the whiskey insurrectionists. In many respects, the fault lines of the Whiskey Rebellion are still present in contemporary society, if you understand the issues and know where to look. And absent Mr. Hamilton’s tax on whiskey and the rebellion that it sparked, the United States of America would be a very different nation. The world would be a very different place.

One last note…If you want to sample the rye whiskey of old, the closest brand you can find on the market today is Old Overholt. If you cannot locate a bottle of “O.O.” (it is hard to find), then try a sip of Jim Beam Straight Rye Whiskey. Even if you do not drink hard liquor, take a taste. You will be reliving history.

Best wishes to all…

Byron W. King
for Whiskey & Gunpowder
December 17, 2004

The Whiskey Rebellion: Whiskey Taxes: The Real Thing was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.