On the night of December 16, 1773, a group of Americans boarded three ships anchored at Griffin’s Wharf in Boston harbor and threw 342 chests of tea overboard into the bay. The circumstances leading up to the Boston Tea Party of 1773 included government interference and “company rent-seeking*, market distortion, bailouts and stealth taxes.” Sound familiar? Rick Santelli’s call for another Tea Party on February 19, 2009 was history repeating itself in more ways than one—similar events to those in the 1700’s caused the rise of the Tea Party movement in 2009! This is what happened in the years prior to that December date in 1773 (emphasis added).
The Indemnity Act 1767 lowered the tax on tea consumed in Britain, and refunded the tax paid [by the East India Company] on tea imported to the colonies. Government, however, needed to replace its lost revenues, and so was passed the infamous Townshend Revenue Act 1767, which levied taxes on all sorts of imports into the colonies. And so began the dispute about whether or not the British Parliament had the right to tax Americans….
…as well as buying black market tea, the colonists organized boycotts and non-importation agreements. The popular pressure forced Parliament to repeal the Townshend taxes in 1770 – except for the tea tax, which by this time had taken on a symbolic importance of Parliamentary supremacy.
In 1772, the Indemnity Act 1767 expired…A new Act reduced the refund to three fifths, restored some other taxes repealed in 1767 and kept the Townshend tax in place. Result: a government-imposed increase in the price of tea and a conse- quent collapse in tea sales. The East India Company faced ruin – it needed a bailout!
…The Tea Act 1773 dropped the ban on the Company selling tea to America directly, so removing the middlemen and lowering prices…This enabled the Company at long last to sell tea cheaper than the smugglers.
But the Townshend duty remained, an affront to Americans and a symbol to the British government. Realizing the problem, the East India Company arranged for it to be paid in London or otherwise hidden. It was, in effect, an early Stealth Tax.1
Because the Tea Act caused taxes to drop, Iain Murray reminds us, “…the Boston Tea Party was a protest against British usurpation of American liberties, not high taxes.” The East India Company sent ships of tea to American in the face of warnings by Benjamin Franklin and others not to do so. The ports of New York, Philadelphia, Charleston, and Boston all resolved not to allow any tea to be unloaded.2 The first ship arrived in Boston Harbor on November 27, 1773:
According to the law, if the tea was not unloaded within 20 days (by December 17), it was to be seized and sold to pay custom duties. Convinced that this procedure would still be payment of unconstitutional taxes, the radical patriots resolved to break the deadlock. On December 14, Rotch [owner of the first ship] was called before a mass meeting and ordered to seek clearance again to sail from Boston. But neither the customs collector nor the governor would grant it.3
Thousands met in Boston at the Old South Meeting House on December 16th, and Rotch was asked to go again to the governor asking for permission to sail. They met again late in the afternoon.
When they reassembled the merchant had not returned, and the question was put to the meeting: “In case the governor shall refuse his permission, will you abide by your former resolutions with respect to not suffering the tea to be landed?” Earnest men spoke to the question. Among the most earnest was young Josiah Quincy, a rising lawyer. He harangued the crowd with prophetic words eloquently spoken. “It is not,” he said, “the spirit that reposes within these walls that must stand us in stead. The exertions of this day will call forth events which will make a very different spirit necessary for our salvation. Let us consider the issue. Let us look to the end. Let us weigh and consider, before we advance to those measures which must bring on the most trying and terrible struggle this country ever saw.”When Mr. Quincy ceased speaking, it was sunset and the church was lighted by candles. The question was put, and the thousands answered in the affirmative. There was a call for Mr. Rotch, but he had not returned. He came soon afterward, and reported that the governor peremptorily refused him permission to send his vessel to sea before the tea should be landed. A murmur ran through the vast assemblage, but the rising excitement was hushed into silence when Samuel Adams arose, and in a clear voice said: “This meeting can do no more to save the country.”4
The meeting was adjourned, the ships were boarded, and the tea dumped, turning the water of Boston Harbor brown for days. Tea parties were also held in New York, Maryland, and New Jersey. In 1774, Parliament took retaliation on Boston by removing “the Custom-house, courts of justice and government offices of all kinds from Boston to Salem, and forbade every kind of shipping business in the harbor of Boston.”4
Remember the words of Josiah Quincy as he spoke to those gathered in the Old South Meeting House in Boston on December 16, 1773:
It is not the spirit that reposes within these walls that must stand us in stead. The exertions of this day will call forth events which will make a very different spirit necessary for our salvation. Let us consider the issue. Let us look to the end. Let us weigh and consider, before we advance to those measures which must bring on the most trying and terrible struggle this country ever saw.
Quincy was right; a different spirit would be needed in consequence of the night’s events than the spirit of those gathered in excitement and uproar on December 16th. It’s easy to be caught up in the momentum and emotion of a moment, but to persevere, enduring setbacks and fears, is another thing altogether. We must understand the presuppositions, reasons and consequences of the actions of ourselves as well as others. We must also have character that endures setbacks and fears and that through example and encouragement helps others to persevere.
This is a major theme of Upstream Politics because I think it is a paramount need and goes to the heart of the crisis in this country. I certainly hoped and wanted to see the elections of 2010 and 2012 turn the country around. 2010 brought a very hopeful outlook, and it did make a huge difference by preventing Congress from being completely controlled by the Democrats. There have been great disappointments, however, and the losses in 2012 have been hard to bear. We all want instantaneous change and our burdens quickly alleviated, but now we must remember that it is not the spirit of 2009 that must stand us in stead. A very different spirit is necessary now.
*If you’re unfamiliar with the term rent-seeking, Wikipedia defines it as, “an attempt to obtain economic rent by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth.” The Foundation for Economic Education (FEE) states, “…to use political means—the government’s authority to initiate violent aggression and fraud—to contrive rents by preventing others from competing with you or by forcibly taking the wealth of others, people will naturally tend to spend valuable resources trying to gain access to them. This is rent-seeking.”
1Iain Murray, “We Wouldn’t Have Teaparties If It Wasn’t For Rentseeking,” April 19, 2009. OpenMarket.org
2Benson J. Lossing, “What caused the Boston Tea Party?” Our Country, 1877.
3americanrevwar.homestead.com/files/TEAPARTY.HTM Unfortunately, this link is now dead.
4The Full Description of the Events, Boston Tea Party Historical Society.