Ramp Hollow: Taxation and the Enforcement of Capitalism
One thing I realized in reading Ramp Hollow: The Ordeal of Appalachia is that all of us concerned with the extreme inequality in American life need a better way to talk about taxes. I found the discussion of the tax bill in terms of how individual families across the economic spectrum would be affected misleading. That approach seems to make the way we think about taxes into whether people at the bottom end have their tax burden alleviated, and if so, it is good. Insofar as liberals are willing to defend taxes, they do so by arguing that taxes support government services. The argument against tax cuts then becomes a defense of government on the basis of the services government provides for the poor. When poor people argue against taxes in general, liberals tend to argue that they are arguing against their self-interest. Liberals argue that taxes are not the problem, it is the regressive structure of taxes that puts the burden on the poor and middle-class and shifts the wealth to the rich, as the recently passed tax bill does.
Steven Stoll makes the case in Ramp Hollow that it was the introduction of a tax, specifically of a tax on whiskey that forced the enclosure of the commons in Appalachia and made previously independent mountaineers into people irrevocably tied to and dependent on the national economy and eventually dependent for their sustenance on coal companies. This case suggests that tax when used as a mechanism against those who live off of a commons is a coercive mechanism in the service of enforcing a capitalist economy, where those who might be laborers must work to increase value for capitalists rather than work independently for their own sustenance to the extent they wish to work. Capitalists are willing to pay a tax if the tax changes the relation of the mountaineers to their land, their labor and the national government. Later discussions of the distribution of the tax are incidental to this initial demand that everyone pay the tax, a demand that requires those living off the commons to turn their commodities into value, and thus to monetize what was previously beyond the scope of the national economy. At this stage in late capital, the distribution of the tax contributes to inequality, but knowing the history explains how taxes on rural populations in the early days of the United States were the coercive efforts of the government to enforce one economic system on those who had no need for it, and who received little support from the government in return for it.
As Stoll explains it, agrarians for centuries depend on an ecological base from which they derive subsistence and commodities. People maintain the ecological base and access to it to members of the community in order to support their makeshift economy — an economy between subsistence and production of commodities for exchange to supplement their subsistence. The people who had access to a commons were not poor because poverty, Stoll argues, is not a lack of things, but a social relation in which people are deprived of subsistence (256). If you wanted to take people out of this economy and make them willing to accept wages for their subsistence, you had to erode their ecological base or their access to it. This Alexander Hamilton accomplished with the whiskey tax.
According to Stoll, Hamilton forced the entrance into the capitalist economy by the people of Appalachia by forcing them to transform their labor into alienable value, which is to say, money, rather than allowing them to continue to work on a commons for their own measure of their sustenance. The Whiskey Tax allowed the government to “lever open western households” and to “reach[..] into the relationship between farmers and their land” by forcing the conversion of the product of their labor into money (93). Hamilton’s ultimate goal was to compel the mountaineers to turn all their labor into money by forcing them “to separate them from land altogether” (93). Hamilton thought he was motivating development and ushering a backwards people into civilization, by which he meant a capitalist economy.
Hamilton determined an excise tax in 1791 on whiskey. The problem with the whiskey tax was that it did not distinguish between whiskey produced for use and whiskey produced for exchange but taxed all equally even though only whiskey produced for exchange produced money. So if producers drank everything they produced they still needed to pay the tax on it. Whiskey was used in the backwoods of Appalachia as an alienable commodity that held value and could be exchanged for other goods without having to participate in the national economy. What this meant though was that whiskey was produced for uses other than for exchange itself, and so taxing it reached beyond the monetarily value that it reached and forced further production for money. As Stoll put it, whiskey produced no coin. The Whiskey Tax required the shift to producing coin. Hamilton could have taxed many other things that would have had less of an effect on the mountaineers relation to production, but he taxed something that was “deeply rooted in the makeshift economy” (100).
The mountaineers already paid local taxes. In the 1790s, 7500 people in the Pennsylvania backwoods paid county taxes. They resisted the Whiskey Tax by arguing that whiskey did not transmit the value of labor but was quickly consumed. It was for this reason that Hamilton felt justified in this tax, because this use of whiskey by the mountaineers allowed them freedom from the national economy and from production for labor in a way that Hamilton thought fell short of the development he wanted for his young economy. As Stoll put it, Hamilton saw the tax as an education tax, meant to educate the mountaineers in a developed economy that produced alienable value not subsistence. To pay for the tax on what was produced for subsistence, the mountaineers agreed to sell land that had been held in common and in so doing forfeited a way of life.
Written into the background of this story is the difference between how the mountaineers treated the commons and how the national government viewed it as private property. The government distributed deeds as gifts and favors to absentees including to George Washington who would later claim the land with legal maneuvers that the mountaineers were unable to effectively thwart. This claim on deeds alongside the Whiskey Tax made them dependent on labor for subsistence instead of their land. Thus, the Whiskey Tax ushered them into capitalism by making them dependent on the capitalist for subsistence where they had previously been dependent on their shared land. As Stoll puts it, the people of the mountains thought that the War of Independence would make them independent from the government. It did not.
When I learned the story of the Whiskey Rebellion, I always heard it as the resistance of people to contributing to the national project. It’s unfortunate that resistance to taxation among the working poor remains understood in this way. If anyone resists contributing to the national project today by not paying taxes, it is those whom that project most serves. In case there is any doubt about who that is, look at the ways the recent tax bill shifts the burden away from the richest people.