Some Important News Regarding Your Rum Rebellion Subscription

I’ve got some important news for you today regarding your free subscription to The Rum Rebellion.

I came up with the idea to start it back in 2018.

I wanted to create a uniquely Australian mouthpiece for market, economic, and political commentary.

The name wasn’t just due to my fondness for rum, although I’d much prefer Cuban to Australian. There was a specific reason for it.

The Rum Rebellion is a largely forgotten tale of early colonial history involving the tussle for economic ascendancy and a rejection of government incompetence and control.

While the name ‘Rum Rebellion’ is generally well known to most semi-students of Australian history, the involvement of rum was only a peripheral issue.

Here’s the background story…

After its establishment in Sydney on 26 January 1788, the British convict colony merely tried to survive. But after a few years, it became more prosperous and began trading with the outside world.

The ‘governor’ ruled the colony, taking instructions from London. The ‘NSW Corp’ was like an early security/police force, tasked with carrying out the governor’s instructions.

The officers of the early Corps (which included John Macarthur of sheep breeding fame) were allowed to engage in trade alongside their official duties. This saw them gain significant power.

They did this by having a monopoly on trade. When trading ships sailed into Sydney Harbour, and after the government replenished its stores, the officers bought up the rest of the cargo and on-sold the goods to the inhabitants for a huge markup.

But their stronghold on trade didn’t last long. Soon, ex-convicts entered the market, diminishing officers’ power. The upshot of this episode was the emergence of an entrepreneurial class in the new colony.

This entrepreneurialism also grew as a result of the land-grant system. Among others in the colony, the NSW Corp officers were given significant land grants and free convict labour to cultivate land and grow produce. If convicts wanted to work extra hours, they were paid in goods, which more often than not, was rum.

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The NSW Corp was therefore heavily involved in the trade of rum and was often referred to as the Rum Corp.

John Macarthur was the pin-up entrepreneur of the time. He had been experimenting with sheep breeding for years and had created some of the finest merino wool in the world.

The MacArthurs of the colony continually clashed with the governors. Modern-day scholars believe this was the result of London wanting to maintain a primitive convict colony, while the new settlers wanted the economy to thrive.

The tough and tyrannical William Bligh arrived in Sydney with the role of governor in August 1806. He encouraged the early colony to focus on basic agriculture rather than the development of the wool trade, overseas trade, or manufacturing.

He also reduced the number of land grants significantly. Of the 1,600 acres he issued, half were to himself and his daughter.

He immediately clashed with the former NSW Corp officer — and, by now, very wealthy — John Macarthur. Bligh threatened to remove Macarthur’s land grant of 10,000 acres at Camden in southwestern Sydney.

Bligh then took Macarthur to trial over one of his trading ships, but the jury of officers from the Corp refused to recognise the court.

The commanding officer of the Corp, George Johnson (with the obvious encouragement of Macarthur) said Bligh needed to be removed from office.

So on 26 January 1808 — 20 years after the founding of the colony — men from the NSW Corp marched on Government House in Sydney and arrested Bligh. Johnson, if only for a short while, took command of the colony. But within a few years, he, Macarthur, and Bligh would be back in London facing court martial over the incident.

It was the first and only military coup in the country’s history. And in true Australian fashion, it was accomplished without bloodshed.

At its core, the Rum Rebellion was a fight for the economic development of Australia. On one side was the government who wanted to maintain a primitive convict economy; on the other were the free settlers and entrepreneurs who wanted trade to flourish and the economy to develop.

That’s not to paint the free settlers and entrepreneurs in too positive a light. They could also be greedy, devious, and ready to take advantage of their fellow colonists for personal gain.

This is just the way of the world. There is a constant battle between the core ideology of government control of the economy and a free market. But the absence of regulation opens the door for unscrupulous characters to pursue profits and power…and then use this power to create barriers to trade and cement their position.

A bit like how things are now. Special interests infect Canberra. Politicians largely answer to these groups rather than the people.

Human nature never changes, in politics or markets.

But some things do change. And it is with some sadness I tell you that The Rum Rebellion is coming to a close. Next Friday, 10 December, will be the last edition. We’ve made the decision to merge with our sister publication, The Daily Reckoning Australia. You’ll still hear from everyone here, but it will be under The Daily Reckoning Australia banner.

Why the change?

Well, at the time I created The Rum, we were two separate companies. I wanted to create a version of The Daily Reckoning Australia with a uniquely Aussie foundation story.

Since merging back to a single company last year, we’re doubling up on a very similar philosophy. From a business perspective, it doesn’t make sense.

We want to stay lean and efficient. I reckon John Macarthur would approve.

So enjoy next week’s essays from our stable of misfits. And please join us at The Daily Reckoning Australia, where we hope to continue to entertain and (sometimes) offend you.

Don’t worry. You don’t need to do anything. You’ll automatically start receiving The Daily Reckoning Australia from 13 December.

I hope to see you over there then!


Greg Canavan Signature

Greg Canavan,
Editor, The Rum Rebellion

PS: The Rum Rebellion is a fantastic place to start your investment journey. We talk about the big trends driving the Australian Economy. Learn all about it here.

Greg Canavan approaches the investment world with an ‘ignorance is bliss’ philosophy. In a world where all the information is just a click away at all times, Greg believes we ingest too much of it. As a result, we forget how to think for ourselves, and let other people’s thoughts cloud our own.

Or worse, we only seek out the voices who are confirming our biases and narrowminded views of the truth. Either situation is not ideal. With regards to investing, this makes us follow the masses rather than our own gut instincts.

At The Rum Rebellion, fake news and unethical political persuasion are not in the least bit tolerated. It denounces the heavy amount of government influence which the public accommodates.

Greg will help The Rum Rebellion readers block out all the nonsense and encourage personal responsibility…both in the financial and political world.

Learn more about Greg Canavan's Investment Advisory Service.

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