The Misesian, vol. 2, no. 1, 2025

On the night of the Boston Tea Party in 1773, American insurrectionists donned disguises and destroyed a shipment of tea imported by the East India Company. The protestors boarded privately owned ships in the harbor and threw the tea overboard. Later that night, the activists discovered another tea shipment that had been unloaded at a warehouse. Not content with having destroyed most of the company’s import, they broke into the warehouse and destroyed that tea, too. The total damages amounted to more than $1.5 million in today’s dollars.

This was the work of the Sons of Liberty, a group which would become known for acts of resistance, arson, and violence against tax collectors and other agents of the crown.

But why destroy the tea of a private company if the group’s target was the British state? The answer, of course, is that the East India Company was essentially an adjunct of the regime and private in name only. This was the era of mercantilism, when colonial governments used protectionism and monopoly powers to enrich the state and its supporters through supposedly private companies. The Sons of Liberty understood the system well and targeted the “private” East India Company.

The success of the American Revolution struck a heavy blow against the mercantilist system. But unfortunately, the wound was not mortal. Many old mercantilist policies persisted under new labels and were promoted with new claims of helping “the people.” The regime of the new republic, too, used the tools of cartelization, monopoly, regulation, and taxation to support certain corporate friends at the expense of ordinary people. Many names have been used for these neomercantilist practices, including cronyism and corporatism. In this issue of The Misesian, we explore the fine line between the state and private business.