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Lecture 8 of 9 · The Economic History of the United States

The American Revolution: Part 2

Mark Thornton · 35:47 · Recorded 14 January 2010

The American Revolution: Part 2 by Mark Thornton is a free audio lecture (35:47) at freecapitalists.org, recorded 14 January 2010, part of the 9-lecture series The Economic History of the United States.

U.S. EconomyU.S. HistoryWar and Foreign Policy

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0:00Okay, we're talking American Revolution. And as we go through this, the events leading up to the American Revolution, and some of the things that are causing the American Revolution, I'd like you to think about it in terms of other revolutions, rebellions, insurgencies in history, and how it might be different or how it might be the same to the colonial experience. Okay, in the previous class, in sort of setting up the prelude to the American Revolution, what we saw was that the British mercantilism had been, for a very long time, had a much larger or louder bark than bite on the American colonists.

1:04It wasn't as oppressive as it otherwise could have been, and that the Americans were doing fairly well. And as Parliament and its specific factions or parties in the British Parliament gained control in England, they also gained control of the colonists, and one of the things that they seek to do is to exploit the American colonies at a much greater level. So they want lower cost for the British, they want more revenue for the British, and they want to get it out of the American colonies. So the third crisis is the acts that are leading up to the actual rebellion.

1:57In the second crisis, we saw the Quartering Act and the Stamp Act, attempts to raise revenues and attempts to cut their costs. I want to go back and give you a little bit of detail about how they actually went about doing some of those things. The protests against the Quartering Act and the Stamp Act were fairly successful, but they did not succeed, ultimately, in getting the British to back down, initially. Patrick Henry, someone you should remember from American history, Patrick Henry from Virginia was a member of their colonial government, a representative, and everybody was basically opposed to the Stamp Act.

3:00Everybody was basically opposed in the Virginia legislature and in the legislature throughout the colonies. But Henry realized that it was basically the old farts who were too timid to go forward with opposition to the Stamp Act. He declared that in defense of English liberty, meaning liberty of the English colonists, that self-taxation is the fortress of freedom. So he was basing his protest and his opposition to that tradition where Virginia got to tax itself.

3:51And he and his friends put together the Virginia Resolves, or resolutions, resolutions to be passed by the Virginia legislature. And these resolves went so far as to say that Virginia citizens should not obey the Stamp Acts. In fact, the final resolve said that anyone who maintained that Parliament had a right to tax Virginia and had the taxing power to do that was an enemy of Virginia.

4:52Now these resolutions as you can tell just from the flavor of the last two really verge on treason, treason with the British Empire. Now, of course, the legislature really couldn't do much about this. They resolved that the Stamp Act was a bad thing and we shouldn't obey it. But it wasn't for them to disobey, right? It's for the citizens to actually disobey. And the Virginia Resolves News of them passed throughout the colonies. They were printed up and distributed in many of the other colonies. And another fellow that you've heard of, Sam Adams, was one of the

5:49people who read them. Of course, now Sam Adams is famous for his beer, or the beer that's or the beer that's named in his honor, I should say beers, but he was from Boston, he was a rebel, he saw that many of the other people in the colonies weren't really going to make an effective opposition. The Tories sort of supported the British power and the British presence in the colonies. Even somebody like Benjamin Franklin basically was a sellout in terms of the Stamp Act.

6:35He actually encouraged his friends to try to get the job as tax collector or stamp tax collector. So Sam Adams resolved to do something about it. He set up a group called the Loyal Nine. The Loyal Nine was a secret society made up of diverse people from the community. And this group enlisted the support of, or enlisted mob support. And when I say mob, I'm not really referring to the mafia type mob. I'm referring more to like gangs, gangs and it's interesting what their strategy here was it was not an open armed rebellion type of a strategy it was more of a voluntary type thing and largely non-violent One of their favorite tricks was to make an effigy or a doll-like likeness of the stamp tax collector.

7:53So you sort of make up this doll, dress him up like the stamp tax collector, maybe hang Hang the guy's name on the front and then take the effigy and hang it outside the guy's house so that the stamp tax collector realized that he was the bad guy and that everybody in the community was after him. They would also take the effigy and make a mock funeral procession so they would parade And then the mobs would also go in front of the stamp tax collector's house yelling the saying, liberty, property, and no stamps.

8:42So it was basically a process of intimidation. They would go to the guy's house, and they would go to the guy's house, and they would go to the guy's house, and they would go to the guy's house, and they would go to the guy's house, They would go to the guy's house, make sure they made enough noise so he would come to the window or to the door, and then they would cut the effigy's head off. Or another favorite trick would be to set up a bonfire across from the guy's house and burn the effigy in the bonfire. This process, and sometimes they would throw stones at the guy or throw stones at his house, trash his yard, and so on and so forth.

9:32And this was a fairly blatant sign that the stamp text collector was not everybody's favorite person, and it would usually get the guy to resign. And they did this not only with a stamp text collector, but anyone who they viewed as a sellout to the British Empire. Anybody who was possibly an informer about people not using the tax, paying the taxes. And so in this process, as it spread throughout the colonies, of intimidating the tax collectors, of intimidating the sellouts and intimidating the informers, the Stamp Act was effectively nullified by the colonies. effectively nullified. And nullification is when a junior political unit nullifies or says it's not going to enforce the legislation passed by the major political entity.

10:37In this case, the colonies were saying to the British Empire that we are not going to accept the Stamp Act, that we're not going to use the stamps, and that we're not going to pay the taxes. And this was a similar process that also led up to the Boston Massacre. With the British troops stationed in Boston, they were hated by the citizens. Individual soldiers would be beaten up in the streets of Boston, largely non-violent, there was some violence.

11:24If a soldier tried to intimidate a citizen, he would be arrested and brought into court, are usually convicted. The citizens would resort to hitting the soldiers with sticks, throwing stones at them, name calling, and they would also do this to informers as well. One mob who surrounded a small group of informers actually ended up shooting two children who were in the front of the mob trying to place an effigy in front of the informers house. Later in that week a mob attacked the custom house, really just surrounded it and started Throwing Snowballs at the Troops. You all know what snowballs are, hopefully.

12:23So the Customs House officials called out soldiers, and the soldiers are actually surrounded by the mob, and one of the soldiers drops his gun, and the other soldiers, thinking that a shot was fired, shoot into the crowd, killing five people. And that was the Boston and Massacre, which leads us into the Boston Tea Party. The Tea Act passed in 1773, and the Tea Act essentially gave the East India Company a complete and well-protected monopoly on the sale of tea into the colonies.

13:33This didn't necessarily increase the tariff burden very much on the colonies, but it basically cut out all of the importers and wholesalers, the wholesale distributors in the tea business. So not only was the East India Company given a monopoly, but they basically took over the and the entire tea business except for of course the retail side of tea distribution. Okay, so tea is monopolized and the tea was pretty important.

14:25It was one of the favorite beverages in the colonies. It's something that had been discovered in Asia, of course, and its use throughout the world spread. Production increased and the price of tea fell dramatically in a very short period of time. And it was something that the common man was consuming, a very beloved product. Americans, of course, are famous for inventing iced tea, not at this time, a little bit later, and paper tea bags. And, of course, the British wanted to change the distribution of tea from a competitive business into a monopolized business. And the colonists were most concerned that once they did this to tea, it would spread to all other types of products.

15:25So of course the people who were in the tea business were very ticked off, but everybody else who was involved in import and export businesses realized that if the British could do this to the tea business, they could essentially do it to the distribution of all other types of goods. And this is what led a group of 30 or 40 men to the British Tea Party, where they essentially destroyed and ransacked tea that was on ships, tea that was in some warehouses, threw it into the Boston Harbor.

16:15So this group basically felt that if the British were going to destroy them, they were going The British, however, didn't take kindly to this at all, and in 1774 they passed the Intolerable Acts.

16:52This was a far-ranging piece of legislation. It closed the Port of Boston. It exempted British officials from being charged for crimes and tried in colonial courts. So, if a British official was charged with a crime, the trial would be either dropped or moved to a court outside of the colony. The legislation actually changed the colonial charter of Massachusetts, which of course Of course, a charter is kind of a contract, you know, where Britain says to the colony, these are the rules and regulations that are going to govern our relationship, and the British sort of unilaterally said, we're rewriting that contract and we're going to reduce your rights in the process.

18:05And it also required that more British troops would be stationed in Boston after the massacre. So this reaction on the part of the British is essentially what led to the formation of the Continental Congress. Yes, that's a very good point. All of these actions on the part of Britain are going to get written into the Declaration of Independence and they're actually written into a document that was also written up by Jefferson and others, sent to the king saying, you know, we've got a problem here and we want you to do something about it.

19:04And of course the king didn't do anything about it and in part didn't have all the authority that he needed to do those things. And so after giving the crown the opportunity to do the right thing. The American colony saw no other choice but to form a Continental Congress, essentially go to war for independence. Yeah, I'm trying to think of what it's called.

19:50I'll have to look that up. It's not a very famous document, but it really should be more famous because it says to the king, okay, these are the rules which you agreed to to govern the relationship between England and the colonies. Those rules have been broken. These are the things that you and England have done to the colonies which have broken those rules and we want you to change them. We want you to rectify that situation. and they not only didn't comply, they went even further with the intolerable acts and so therefore you get, okay, you've had your last chance, we are declaring our independence.

20:44So the colonists went through this whole process of having their rights violated as they saw it, Using non-violent ways such as the boycott, non-importation of British goods, but parliament kept coming back with more intolerable type acts or legislations. And eventually, of course, the level of violence is escalating here on both sides and the intolerable acts were the last straw, so to speak, and so the Continental Congress is formed, the Declaration of Independence eventually is written.

21:40The Continental Congress called for the non-importation agreement to boycott all English goods, among the grievances established by the Congress to justify its existence, in other words, to establish its legality, Were Illegal Taxes Imposed by the Parliament Well, just the basic parliament takeover of power, takeover of the legislative power in the colonies, establishing colonial tax collectors, like the stamp tax collectors.

23:13There had been British courts establishing the colonies for a long time, But these courts were in the port city for purposes of overseeing international trade and collecting tariffs and things like that. So they were basically courts to govern over the sea and international trade. And the authority of these British courts basically moved inland Inland, so that the British courts could actually administer over issues in the colonies themselves. So the British courts and their authority goes from sea inland.

24:06Traditionally all legal disputes in the colonies other than trade and tariffs and things of that nature were done in colonial courts. The colonial courts, the judges, put under British control, and of course you can see why the British put the colonial courts under their control, because the colonial courts under colonial control would always find the colonists, not always, but largely finding the colonists.

24:55If you were to find the colonists not guilty, if it was an issue of a colonist throwing a stone at a British soldier, the colonists would usually be set free. But if a British soldier knocked a colonist over with his gun or something like that, the British soldier would always be convicted. So the British felt like they were getting unfair treatment in these colonial courts, and so they basically took them over.

25:30Standing Army was imposed and increased in size. The British standing army had always been one to protect the colonists. So they'd have a fort in the harbors and they would have forts out there in the frontier to protect the colonists against Indian raids. Now, instead of protecting the colonists, the soldiers were there for the purpose of subjecting the colonists. If British soldiers and officials were charged with violating the law, their trials could be transported out of the colony for trial.

26:51Port of Boston was closed, that was one of their grievance, and of course the Port of Boston was one of the largest and most active ports in the colonies. It wasn't closed for a particular time period. It was closed more or less permanently and remained closed while the British controlled All the Port, which was for a very long time. Now of course they would, you know, people were still smuggling and people were still running the blockade. The British also established martial law in boston after the boston massacre

28:15the quebec act uh... dates from early on where the uh... Remember when the British draw the proclamation line and say there's going to be no settling the area west of the Appalachian Mountains? Well the colonies viewed that area as part of their territory so they viewed the Quebec Act as the British confiscating colonial lands. Yeah, 1763. So these grievances that the Continental Congress lists date, you know, some of them occur very recently, others date back, so there's a history of abuse here that the colonists have been trying to fight through.

29:29The Battles of Lexington and Concord occur April 19, 1775. The Declaration of Independence, July 4th, 1776 And of course then the war is on, where the colonies are openly in armed rebellion against the Motherland or Britain.

30:24So when we look at the American Revolution and what caused it, we see a process where British mercantilism was for a very long time not that harsh, not that harmful, not that burdensome, but as power was transferred from the king to the parliament, and as parliament fell into the hands of or under the control of the Tory forces in the parliament, the breadth and depth of mercantilist policies increased. There was increased monitoring, increased enforcement, higher taxes, and more severe Your Punishments.

31:15The colonists initially reacted to the harsh British policies in peaceful means such as boycotts and petitions, giving Parliament many opportunities to understand and rectify what they considered to be mistakes and to in fact be illegal. But parliament continued to drive for exploitation of the colonies. And it was not really necessarily the size of the exploitation that mattered, but in the nature of exploitation itself. The colonists were willing to give a little, but not much.

32:07They understood government to be a legal process and any violation of the legality of that process or those agreements was something that the colonists would simply not permit. They didn't want to permit the process of exploitation to start because they knew where it would lead to. They knew that it would ultimately result in greater levels of exploitation, wider scopes of Exploitation, and therefore they resisted any unreasonable attempt to violate their rights.

33:00Next week I'm going to start with a discussion about what made the colonists so different, Because this is a very unusual situation. Usually you see people willing to give into exploitation. They're willing to give into this process whereby, okay, the government's just taking a little bit, okay, they're just taking a little bit more the next year, okay, they're just violating this right, you know, what are we going to do about it, really? I mean, that's the general course of human history is that we lose our rights and government grows in power, size and authority for a lot of different reasons, but it usually does it in a very slow process.

33:55Okay, and not only were the colonists different in that respect, but they also responded to this vigorously, but in a way that you don't really see very much in human history. You don't see voluntary agreements like boycotts being very successful in thwarting the exploitation by an empire or by a colonial ruler very often. What you usually see is things get out of control and there's a lot of violence and guns and everybody ends up dead. Okay, so the colonists are very different from a lot of experience in history. We're also going to look at the conduct of the war itself in terms of some basic economics, the public finance of the colonial Congress, the Continental Congress, the famous hyperinflation of the American Revolution, and then we're going to turn our attention to Two very important documents in American history. First, the Articles of Confederation, the first American government, and then we're going to, of course, turn our attention to the U.S. Constitution and the economic ramifications of why do we go from the Articles of Confederation to the Constitution and what does the Constitution mean for American history.

35:35History. So it's going to be a defining document for the structure and institutional arrangements for the economic history of the U.S.

Part of a series

The Economic History of the United States

9 lectures, 6 hours, recorded 2010. See the full series or subscribe by RSS.

Speakers: Mark Thornton.

Recording date and topics for this lecture come from the Mises Institute's page for The American Revolution: Part 2, checked 2026-08-04.

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The recording runs 35:47.
Who gave the lecture The American Revolution: Part 2?
Mark Thornton delivered it, in the series The Economic History of the United States.
When was The American Revolution: Part 2 recorded?
It was recorded 14 January 2010.
What series is The American Revolution: Part 2 part of?
It is lecture 8 of 9 in The Economic History of the United States, which is free to stream or download in full.