Whiskey Ring

(noun)

A U.S. scandal, exposed in 1875, involving diversion of tax revenues in a conspiracy among government agents, politicians, whiskey distillers, and distributors.

Related Terms

Examples of Whiskey Ring in the following topics:

  • Scandals

    • The most infamous scandal associated with the Grant administration was the Whiskey Ring of 1875, which was exposed by Treasury Secretary Benjamin H.
    • Babcock, were eventually indicted in the Whiskey Ring trials.
    • Grant unexpectedly issued an order not to give any more immunity to persons involved in the Whiskey Ring, leading to speculation that he was trying to protect Babcock.
    • Grant then replaced Henderson with James Broadhead, who had little time to research the facts surrounding Babcock's case and those of other Whiskey Ring members.
    • Broadhead went on to close out all the other cases in the Whiskey Ring.

  • The Whiskey Rebellion

    • The Whiskey Rebellion, or Whiskey Insurrection, was a tax protest in the United States beginning in 1791, during the presidency of George Washington that directly challenged the federal government's right to levy taxes.
    • A whiskey tax would therefore make western farmers less competitive with eastern grain producers.
    • There were two methods of paying the whiskey excise: paying a flat fee or paying by the gallon.
    • Large distillers produced whiskey in volume and could afford the flat fee.
    • Resistance to the whiskey excise tax came to a climax in 1794.

  • Promoting Economic Development

    • However, farmers on the western frontier operated private distilleries to generate extra income, and for many poor farmers, whiskey was a medium of exchange, rather than a source of cash.
    • For these farmers, the whiskey tax constituted an unfair income tax that favored wealthy farmers and eastern distilleries who could afford to pay a flat tax per barrel.
    • In 1794, outbursts of violence against tax assesors in western Pennsylvania evolved into a large mob of poor farmers who, motivated by other economic grievances as well as the whiskey tax, demanded independence from the United States.
    • The Washington administration's suppression of the Whiskey Rebellion was met with widespread popular approval and demonstrated that the new national government had the willingness and ability to suppress violent resistance to its laws.
    • Historians such as Steven Boyd have argued that the suppression of the Whiskey Rebellion prompted anti-Federalist westerners to finally accept the Constitution and to seek change by voting rather than by resisting the government.

  • Hamilton's Economic Policy

    • One of the principal sources of revenue that Hamilton recommended Congress should approve was an excise tax on whiskey.
    • Strong opposition to the whiskey tax by cottage producers in the remote, rural regions of western Pennsylvania erupted into the Whiskey Rebellion in 1794.
    • The mainly Scotch-Irish settlers there, for whom whiskey was an important economic commodity, viewed the tax as discriminatory and detrimental to their liberty and economic welfare.

  • Hamilton's Achievements

    • In addition to the National Bank, Hamilton founded the US Mint, created a system to levy taxes on luxury products, such as whiskey, and outlined an agressive plan for the development of internal manufacturing: arguing that Americans needed to produce their own goods to avoid excessive dependence on European powers.

  • The Temperance Movement

    • Influenced by this inquiry, about 200 farmers in a Connecticut community formed a temperance association in 1789 to ban the making of whiskey.
    • Americans increasingly drank more strong, cheap alcoholic beverages such as rum and whiskey, and pressure for inexpensive and plentiful alcohol led to relaxed ordinances on alcohol sales, which temperance advocates sought to reform.

  • Administrative Corruption

    • Graft and corruption charges permeated Harding's Department of Justice, run by Daugherty, who was involved with an illegal liquor scheme in which bootleggers got their hands on tens of thousands of cases of whiskey through bribery and kickbacks to government officials.

  • Gold Fever in the West

    • Supplies were expensive and food poor, typical diets consisting mostly of pork, beans, and whiskey.

  • Hamilton's Legacy

    • Mint, created a system to levy taxes on luxury products (such as whiskey), and outlined an aggressive plan for the development of internal manufacturing, arguing that Americans needed to produce their own goods to avoid excessive dependence on European powers.

  • The Jefferson Presidency

    • He pushed for—and Congress approved—the end of all internal taxes, such as those on whiskey and rum.