Wednesday, July 4, 2012

Democrats outpace even King George III

By Donald Sensing

If the Boston Tea Party protestors didn't like taxation without representation they should see what it is like with representation!

In 1773 between 30-40 American colonials, dressed as Mohawk Indians, boarded tea-carrying vessels in Boston harbor and threw overboard about 90,000 pounds of tea awaiting offloading. Decades later this event came to be known as the Boston Tea Party. It was an act of colonial defiance against the Crown that was a major step along the way to the American Revolution.

Importation of tea into the British crown colonies had been regulated by Parliament going all the way back to the 1600s. What evoked the 1773 crisis was the levying of taxes upon tea exported to America, coupled with Parliament giving the East India Co. a monopoly on doing so. Taxes had actually been levied on America-bound tea for may years, with protest from the colonies that taxing British subjects without their Parliamentary representation violated Britain's constitution.

Two notes here are important. First is that the residents of the crown colonies were subjects to the monarch with presumably exactly the same rights as if they had been living in England. Yet while subjects in England elected their representatives in Parliament, colonials could not. Nonetheless, Parliament claimed authority over the colonies as absolutely as over any English shire. Second is that Britain's consitution is not a single document as the later American Constitution, but the body of Pariamentary law and precedent, sometimes including regal declarations, that formed the legal continuity of British law. The precedent that Parliament could levy taxes only upon subjects who elected their representatives was long established in the constitution, extending back well into the 1600s.

Parliament deliberately ignored the precedents (there was more than one) and declared it had the right to levy taxes upon the colonies for any reason at all. The real reason for the tea taxes was to pay the salaries and expenses of the Crown's rule over the colonies. Until not many years before the Tea Party, the colonies' governors and administrators were paid directly by the colonials from exactions set by colonial assemblies. Parliament eventually and correctly concluded that this arrangement bound the governors to the colonials more than to the Crown or Parliament.

Tea had been specially taxed for many years before 1773. But because the taxes were so high, smugglers ruined the legal tea trade by importing tea much more cheaply on the black market. This was not exactly an illegal black market. American traders were bringing tea from Holland, which did not tax tea at all, and reselling it in the colonies, also untaxed. This was less actually unlawful as it was a gray area of then-existing law, which Parliament moved to address.

Parliament's response was to dramatically reduce the tax level so low that legally-imported tea was cheaper, even including taxes, than black marketers could profitably match. Furthermore, the tea tax was not a point-of-sale tax. It was levied by specific commissioners upon whole shiploads at a time as the vessels were unloaded in American ports. The tax was buried in the wholesale price of the tea, and all this was sent to England together, where the East India Co. got its share and Parliament got its share. Finally, the East India Co. was granted exclusive rights to be the sole importer of tea into the colonies from any source, meaning the the Company then enjoyed a legal monopoly and American tea importers were put out of business.

But the Americans were not fooled. This arrangement was immediately protested by the colonies. American activists actually compelled tea-laden vessels to turn back to England in a few ports, tax uncollected. But in Boston the governor refused to back down, probably because he had made his sons the the tea-tax commissioners. However, the tax went unpaid because Bostonians peacefully prevented the three vessels in harbor from being unloaded.

The colonies' protest was based on these arguments:

1. They were still paying a tax on tea, however covertly Parliament tried to impose it, and they still had no right to elect their own representatives to Parliament.

2. They knew the tax would be used to pay for their own rule and administration, and, like Parliament, they knew this would cement the governors and the governing apparatus to the Crown more firmly than to themselves. All this meant that there would be no one in the government directly representing the colonies' interests.

3. They did not like the East India Co. enjoying a monopoly. Some of the leading colonial figures had been tea importers, and one could easily and cynically argue that they were simply looking out for their own interests. Yet contemporary records also show that they argued that once Parliament started enacting who alone could carry out certain forms of commerce, there would be no legal limit to it. Monopolies would be granted to the politicallly connected. This they correctly saw as a very oppressive measure.

So in Boston the tea got dumped one night into the harbor. Countless Bostonians vowed to hit Parliament where it hurt - in the purse - by not paying the tax by not buying any tea. Port commissioners, who actually tendered the tax, would not long permit tea vessels to be unloaded if they could not recoup the tax payments through sales to locals.

Some observations:

That Parliament had the legal power to enact the tea tax isn't really disputed, even though extensive legal precedent could be argued against it.

Parliament had the power to regulate commerce within Britain and among British territories and possessions. So its imposition of a tax upon the sale of tea was not outside its authority.

The colonies did argue that the tax was not within the authority of Parliament to impose, but this argument did not prevail and Parliament did what it wanted to do, precedent be hanged.

But not even Parliament tried to tax not buying tea. Parliament taxed the (wholesale) purchase of tea, but did not even think of assessing a tax on the commissioners or consumers for not buying tea at all. Parliament's arrangement was very simple: buy a pound of tea, pay three pence tax. Do not buy a pound of tea, pay no tax.

In contrast, the Affordable Care Act (Obamacare) passed exclusively by the Democrats of Congress and signed into law by a Democrat president - and upheld by a thoroughly confused Supreme Court - reaches far beyond what those colonists, later revolutionists, found completely intolerable. They rebelled against a certain tax imposed on existing and future transactions, while Obamacare taxes transactions that do not now exist and will not exist.

In 1773 and 1775, Americans rebelled and then revolted against imperial overreach. But so far, we're just going to sit here these days and take it.