Protest had decreased in the early part of 1852 but the appalling winter conditions and the dramatic increase in crime led to its revival at Castlemaine and Bendigo. This was less an attack on the license system than a protest against Government inefficiency and especially the lack of protection from criminals. By September, there was so much crime that moves towards ‘lynch-law’ were made and on 30 September a Mutual Protection Association was formed that threatened to stop paying the license fee and use the money to pay for patrols.  The police were seen as ineffective at anything other than collecting licenses and prosecuting sly-groggers (illegal sellers of spirits). It is difficult to assess just how bad the problem of crime was in the Castlemaine area but news of the proposed export duty turned a small agitation into a mass movement.
On 23 October, a well-organised ‘monster meeting’ was held at Castlemaine.  The export duty was condemned, unless it replaced the license fee, as a grossly unfair additional tax. It was agreed that police protection was a ‘mockery’ and that any delay in dealing with the lawless state of the fields would be disastrous. A petition was sent to the Legislative Council and a deputation was appointed to visit La Trobe and that if no reply had been received by 15 November, further action would be taken though non-payment of licenses was viewed as a last resort. In Melbourne, a meeting of several hundred people welcomed the delegates and their attack on this ‘monstrous tax’ and the ineffectiveness of the police. La Trobe was conciliatory when he met the delegates almost apologising for the conduct of the police. The delegates reported back to the diggers and a resolution was passed that if the export tax was imposed, they would all refuse to pay the license fee and offer themselves for arrest. However, the following day unaware of this threat, the Council voted out the bill.
“Dancing Saloon and Grog Shop, Main Road, Ballarat, May 30th/55", by S T Gill
Victory on this issue is insufficient to explain the decline in the digger movement yet by the beginning of 1853 the main diggings were again comparatively quiet. In spite of this, the government did address their other grievances: the Castlemaine police were reformed and an assize court established in December 1852 and a start was made to a macadamised road from Melbourne. Nevertheless, a Select Committee of the Legislative Council also established in December, but despite the critical evidence of Chief Commissioner Wright and Commissioner Gilbert, produced a weak report supporting the license fee. Twice, diggers had successfully resisted proposals to increase taxation, yet the license system remained unchanged.
NSW had handled the gold crisis with ‘masterly commonsense’ and the mining license was effectively and more important sensitively collected with little organised opposition. Yet, in Victoria both the license fee and the ways in which it was extorted from the diggers was a source of growing irritation and resistance. Blainey called it ‘administration by the tape measure rather than the brain’. Without this decision, probably the ‘most mindless’ in the long history of appropriating Australia’s natural resources, he argues, ‘the rebellion at Eureka in 1854 would not have occurred’.  Although Blainey is right to focus on the importance of the license as a cause of resistance in Victoria, policing played a decisive role. The colony was policed to an ‘extraordinary degree’ in the 1850s, policing was regarded as an instrument of government and the police were active agents of an interventionist and regulatory state. 
The criticisms made of La Trobe during 1851 and 1852 by miners and politicians and in the press were largely justifiable. How far La Trobe was responsible for this situation is more difficult to assess. Temperamentally, he was better suited to acting as a subordinate able to gain acceptance of his decisions from his superiors but this option was no longer available once Port Phillip gained its independence. This combined with the maelstrom created by the discovery of gold placed him a challenging situation. Without a strong political base to support and force through his policies, La Trobe floundered from one pragmatic solution to another. He found himself in that most dangerous of political situations of reacting to circumstances rather than controlling them. His licensing policy, even though based on that introduced largely without difficulty in NSW, was poorly managed and failed to gain any real support of diggers. Insensitivity in application and enforcement by some corrupt officials and police turned licenses into a toxic source of growing political confrontation. Sir Charles Hotham may have been responsible for events in Ballarat in late 1854 but La Trobe’s previous mishandling of miners played a significant role in this catastrophic deterioration of relations between politically conscious workers and a seemingly intransigent colonial state.
 ‘Mount Alexander’, Argus, 2 October 1852, p. 4, ‘A Vigilance Committee at Mount Alexander’, Bell’s Life in Sydney and Sporting Review, 23 October 1852, p. 5.