Who Gained the Benefits and Bore the Costs of Credit?
Two Faces of the Same Policy — Creditors and Frontier Farmers
Those Who Gained Credit
WhoBondholders in eastern cities, many of whom were speculators
What they receivedFull redemption at face value, conversion into new federal bonds
ResultEstablishment of trust in the federal government, revitalization of the bond market
Those Who Paid the Cost
WhoSmall distilling farmers in frontier areas such as western Pennsylvania
What they paidBurden of the whiskey excise tax introduced in 1791
Result1794 armed rebellion, suppressed by Washington's militia
A simplified summary of the financing structure for the aforementioned debt assumption policy, with the whiskey excise tax being one of several revenue sources.