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Drinking away debt

August 1, 2019

“Imagine what gon’ happen when you try to tax our whiskey.” – Thomas Jefferson, Hamilton, An American Musical (Cabinet Battle #1)

 

What happened in the newly created United States of America was the aptly named “Whiskey Rebellion,” which reached its high point on August 1, 1794.  (For a succinct discussion of the Whiskey Rebellion and other entertaining and informative posts on history, visit www.taraross.com.)  The legislation had been passed three years earlier under the unwieldy statute titled: An Act Repealing, after the Last Day of June Next, the Duties Heretofore Laid upon Distilled Spirits Imported from Abroad, and Laying Others in their Stead, and Also upon Spirits Distilled within the United States and for Appropriating the Same [U.S. Senate Journal, February 10, 1791; U.S. Senate, 1911, pp. 338-355].  While it applied to all distilled spirits (such as rum, vodka, gin, brandy, tequila and (southern favorite) moonshine), at the time, whiskey was by and far the most popular distilled drink in the States.

 

Rather than meekly accept the first domestically imposed excise tax which sought to pay down the debt incurred under Alexander Hamilton’s financial framework for the nation (which saw the newly created federal government assume the States’ debts from the Revolution), farmers in the South and West (whose crops comprised the main ingredients of whiskey) agitated, complained and eventually raised arms against federal officials in western Pennsylvania.  People were tarred and feathered, as well as shot and killed. Homes were burned down.  It took a militia of about 13,000 men, led by President George Washington himself, to put an end to the violent rebellion.

 

The Whiskey Tax was repealed by 1802, during Thomas Jefferson’s first term as President.  This reprieve from taxation lasted just over a decade, when a new alcohol tax was imposed in 1814 to help pay for the debts from the War of 1812.  In 1862, Abraham Lincoln imposed a new alcohol tax to help pay for the debts from the Civil War.  (Are we beginning to see a pattern here?)  And we have had alcohol taxes ever since, now both locally and federally.  In an interesting coincidence of historical kismet, the state which (as of 2016) has the highest state excise tax on distilled spirits is the state named after the 1791 legislation’s staunch supporter and first defender - Washington.

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