I did not celebrate the Fourth of July today.
This goes back to a term paper I wrote in graduate school. It was on Colonial taxation in the British North American Colonies in 1775. Not counting local taxation, I discovered that the total burden of British imperial taxation was about 1% of national income. It may have been as high as 2.5% in the southern Colonies.
In 2008, Alvin Rabushka’s book of almost 1,000 pages appeared: (Princeton University Press). A review published in the summarizes the book’s findings.
The Colonists had a sweet deal in 1775. Great Britain was the second-freest nation on Earth. Switzerland was probably the most free nation, but I would be hard-pressed to identify any other nation in 1775 that was ahead of Great Britain. And in Great Britain’s Empire, the Colonists were by far the freest.
I will say it, loud and clear: The freest society on Earth in 1775 was British North America, with the obvious exception of the slave system. Anyone who was not a slave had incomparable freedom.
Jefferson wrote these words in the Declaration of Independence:
I can think of no more misleading political assessment uttered by any leader in the history of the United States. No words having such great impact historically in this nation were less true. No political bogeymen invoked by any political sect as “the liar of the century” ever said anything as verifiably false as these words.
The Continental Congress declared independence on July 2, 1776. Some members signed the Declaration on July 4. The public in general believed the leaders at the Continental Congress. They did not understand what they were about to give up. They could not see what price in blood and treasure and debt they would soon pay. And they did not foresee the tax burden in the new nation after 1783.
In his book, Rabushka gets to the point:
So as a result of the American Revolution, the tax burden tripled.
The debt burden soared as soon as the Revolution began. Monetary inflation wiped out the currency system. Price controls in 1777 produced the debacle of Valley Forge. Percy Greaves, a disciple of Austrian economist Ludwig von Mises and for 17 years an attendee at his seminar, wrote this in 1972:
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Only after the price control laws were repealed in 1778 could the Army buy food again. But the hyperinflation of the Continentals and state-issued currencies replaced the pre-Revolution system of silver currency: Spanish pieces of eight.
The proponents of independence invoked British tyranny in North America. But there was no British tyranny in North America.
In 1872, Frederick Engels wrote an article, “On Authority.” He criticized anarchists, whom he called anti-authoritarians. His description of the authoritarian character of all armed revolutions should remind us of the costs of revolution.
After the American Revolution, 46,000 British Loyalists fled to Canada and other places controlled by the crown. They were not willing to swear allegiance to the new Colonial governments. They retained their loyalty to the nation that had delivered to them the greatest liberty on Earth. They had not committed treason.
The revolutionaries are not remembered as treasonous. The victors write the history books.
What would libertarians — even conservatives — give today in order to return to an era in which the central government extracted 1% of the nation’s wealth? Where there was no income tax?
Would they describe such a society as tyrannical?
That the largest signature on the Declaration of Independence was signed by the richest smuggler in North America was no coincidence. He was hopping mad. Parliament in 1773 had cut the tax on tea imported by the British East India Co., so the cost of British tea went lower than the smugglers’ cost on non-British tea.
This had cost Hancock a pretty penny. The Tea Party had stopped the unloading of the tea by throwing privately owned tea off a privately owned ship — a ship in competition with Hancock’s ships.
So once again, I’m not celebrating the Fourth of July today.