Corporate Interests and Economic Tensions Leading to the American Revolution

Imagine a government beholden to corporate interests, in which private corporations write laws favoring themselves to the detriment of the citizenry and small business, where the wealthiest corporations are unregulated and are taxed at extremely low rates while average citizens are required to foot the costs of an expensive and questionable war and government imposes policies in which they have little – if any – say. Imagine large chain stores moving into towns in which they drive all the smaller merchants out of business, then suck up local revenues which are sent to owners and stockholders far away, contributing virtually nothing to the local economy.

While this may sound like the last five years of U.S. history, it was also true of the years leading up to the Revolution.  These were the economic issues that eventually led to rebellion and ultimately, independence from Britain.

Tensions between the colonists began almost twenty years before rebellion finally broke out in 1775. During the “French and Indian War”  (also known as the Seven Years War), the British military was known to “impress” locals into combat service against their will, and confiscate what they needed from private citizens without payment (Zinn, 67). Britain triumphed and gained territories in present-day Canada, but the cost was high.

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Parliament’s decision to the decision to tax the colonies directly was the culmination of a long power struggle between the merchants and the landowners in the legislatures. The former believed that the Crown should go further in insuring that the colonies served the best interests of “the mother country,” i.e., themselves, since much of their livelihood was dependent upon trade with and imports from the colonies. Eventually, these mercantilist policies were instituted, which gave the Crown an excuse to exercise greater power in the colonies than it had before.

Britain meanwhile issued the Proclamation Line in 1763, prohibiting settlement west of the Allegheny and Appalachian Mountains. The official reason was to keep peace between colonists and indigenous peoples. In reality, it was intended to favor large corporate interests in England, allowing them to monopolize trade with Natives as well as engage in land speculation.

This was only the first of a series of laws favoring corporate interests over those of individuals. The following year, the British government passed the Sugar Act, which imposed a tax on molasses from the British West Indies as well as on several additional products. The purpose was to raise Crown revenues, but to the colonists, it was taxation to which they had not consented (Fone, 150).

This was followed by the Stamp Act. This had a dual purpose: to raise revenue, and to “gag” the North American press, which was circulating information regarding these increasingly repressive tax policies. This Act galvanized the resistance as a delegation sent a petition to King George III insisting that the colonies could be taxed only by their own consent.

Parliament was forced to back down, repealing both the Sugar Act and the Stamp Act. These were replaced however with high duties on glass, lead, paper, cloth and tea. The colonists responded with a boycott which sharply reduced the number of British goods coming to the colonies – and greatly hurting mercantile and corporate profits.

Corporate interests appealed to Parliament to rescind these duties. Parliament agreed to end all but one: the Tea Tax. While tensions between Britain and its North Americas colonies were growing throughout the region for various reasons, the issue of the Tea Tax turned out to be the spark that finally lit the fuse leading to the explosion of open rebellion.

What is odd is that the colonists – hardly united, and descended from peoples that had “classes” and “orders” ingrained into their culture – would have ever gotten it in their minds to rebel in the first place.

In fact, the colonists did not necessarily wish to break with Britain; they simply wanted the rights they were entitled to as British subjects, which they believed they were being denied. However, there was a philosophy that had been around for well over a century. The basis of modern democracy actually originated in the writings of Thomas Hobbes, who wrote of the “social contract,” and more importantly John Locke. Around 1680, he had written that government of a people has legitimacy only as long as it has consent of the people it governs, and only as long as it protected those innate, or “natural” rights that every person has by virtue of being born.

Locke listed these as the rights to “life, liberty and property.” By the time his words found their way into the Declaration of Independence, “property” had become “the pursuit of happiness.” Locke’s interpretation of the “social contract” theory stated that when government failed to guard those rights and no longer had the consent of the governed, it was the “natural right” of the people to overthrow it. Locke’s philosophies were very influential on French writers Voltaire and Rousseau – whose nation was instrumental in securing the colonist’s victory – as well as the writings of Thomas Paine and Benjamin Franklin.

In Common Sense – a pamphlet that was circulated widely in the colonies – echoed Locke when he called up upon the colonists to “…oppose, not only the tyranny, but the tyrant, stand forth!” (Foner, 4)  Paine was also one of the first to point out the heterogeneous makeup of the colonies, being composed of peoples from several different nations, arguing that the “birthday of a new world is at hand, and a race of men.”

Works Cited

Foner, Eric. Give Me Liberty! An American History.  New York: W.W. Norton,  2006.

Zinn, Howard. A People’s History of The United States (3rd ed.) New York: Harper

Collins, 2003.

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