A conflict arose over the government’s tax on whiskey, part of Hamilton’s financial plan. From Pennsylvania to Georgia, outraged farmers resisted the tax. For them, whiskey—and the grain it was made from—were important products. Because of poor roads, backcountry farmers had trouble getting their grain to market. Crops such as wheat and rye were more easily carried to market in liquid form, so farmers made their grain into whiskey. A farmer’s horse could haul only two bushels of rye but could carry two barrels of rye whiskey which were equal to 24 bushels of the grain. In addition, their customers paid more for whiskey than grain. With little cash to buy goods, let alone pay the tax, farmers used whiskey as money to get whatever supplies they needed and traded whiskey for salt, sugar, and other goods.

In the summer of 1794, a group of farmers in western Pennsylvania staged the Whiskey Rebellion against the tax. One armed group beat up a tax collector, coated him with tar and feathers, and stole his horse. Others threatened an armed attack on Pittsburgh. Washington, urged on by Hamilton, was prepared to enforce the tax and crush the Whiskey Rebellion. They feared that failing to act might undermine the new government and weaken its authority. In October 1794, General Henry Lee, with Hamilton at his side, led an army of 13,000 soldiers into western Pennsylvania to put down the uprising. As news of the army’s approach spread, the rebels fled. After much effort, federal troops rounded up 20 bare-foot, ragged prisoners. Washington had proved his point. He had shown that the government had the power and the will to enforce its laws.