He's also known for his mental instability which however only affected him noticeably in his younger days and his last days. Why did George III make so many unwise decisions as a ruler. Could it be that his sickness affected him to some extent even when he appeared healthy?
In North AmericaEdit
He oppressed the American People until they got fed up and declared independence on July 4, 1776. The Declaration of Independence lists 27 grievances he committed against his people, including murdering his own citizens and dissolving representative houses because they opposed him.
On the other hand, one of the major reasons why the Founding Fathers despised George so much was because of his Proclamation of 1763, which banned British settlers from settling anywhere west of the Appalachians. His intention in doing so was to lessen tensions with the particular Native American tribes living in those territories, who had had a long & close relationship with France during the Seven Year's War, and who were dismayed to find that they were now under the sovereignty with Great Britain - the King's hope being that the proclamation would reconcile the natives to British rule and prevent hostilities from breaking out. However, the proclamation line was not intended to be a permanent boundary between European-occupied and native-occupied lands, but instead a temporary boundary which could later be extended further west in an orderly lawful manner - in other words, outlawing private purchase of Native American land, and restricting further purchase by Crown officials "at some public Meeting or Assembly of the said Indians". By also further restricting colonial officials from granting grounds or lands without royal approval, the proclamation in effect gave the British Crown a monopoly on all future land purchases from the resident Native Americans - something which the American colonists couldn't stand, as it in effect denigrated the legal status of their officials as true citizens of the British Empire and reducing them to mere "colonial rabble" of the rights of citizenship, and hence hastening their eventual separation from Great Britain. The proclamation also called for lands to be granted to British soldiers that had served in the Seven Year's War, while neglecting to treat colonist soldiers who had provided similar service to the crown in a similar manner.
Just to aggravate the Colonists even more, the Quebec Act was passed in favor of the Colonists' trade rivals, the French Canadians. The Act made the separation of Canada from the Thirteen Colonies final and provided religious freedom and some autonomy to those French Roman Catholics. Most Thirteen Colonists, who were radical Puritans, didn't take very kindly to this.
In Great BritainEdit
There was trouble with the British Parliament as well. Unpopular and dictatorial policies made the British people demand greater liberty too. However, it seems George III was patriotic, though this can be good or bad (as the reaction of his subjects seemed to show).
"George III became seriously ill in 1788. The illness was considered madness at the time, but modern research has suggested that he actually suffered from a severe form of porphyria, a metabolic disorder caused by chemical insufficiency in hemoglobin production. Symptoms include skin sensitivity, strong abdominal pain and port wine coloured urine accompanied by psychiatric symptoms. In severe cases, the illness causes convulsions and death. The theory that George had suffered from porphyria was first put forward by the British Psychiatrist, Ida MacAlpine and her son, Richard Hunter in 1966."- 
The doctors of the time treated the king in a cruel and inhuman way over his sickness. During times when George III appeared rational he was unkind to his subjects, those were cruel times. Remember he certainly wasn't responsible for what he said or did at times when his illness affected him severely.
While it is likely that the story in which he wrongly thought that a tree was Frederick the Great is complete bullshit, it's possibly true that:at some point or another, he
- a.) ended every sentence with the word 'peacock'
- b.) believed that London was flooded and ordered a yacht
- c.) wore a pillow case round his head
- d.) told his wife that she had been mad for three decades
- e.) adopted baby Prince Octavius, a pillow 
He was definitely not insane during the Napoleonic Wars though. He rebuffed Napoleon's peace proposal, calling him a Corsican tyrant and refused to negotiate. By 1811, his insanity had returned and was kept out of public eye. In his absence, his son, the unpopular George IV, ruled as Regent in his place.
The fact that George was a member of the royal family meant he was not to be remedied like any other mentally disabled people who were given treatments such as beatings, cold baths, forced vomitings and blood-letting. He instead was fastened to his bed, shouted at after stuffing handkerchiefs in his mouth to gag him, given medicines that made him violently ill until he prayed to be cured or dead. Blisters were also forcefully formed on his head so that the physician could burst them, letting the badness out of his head. Yeah, they were that dumb.
George's behaviour was obviously weird, but he wasn't stupid like some Holocaust deniers. He was visited by a new doctor, Dr. Willis, and he hated the man on sight. He asked the man whether he was a member of the clergy. he doctor confirmed it and George said that that it was a pity that he had given up a job that he loves for one that he hates. Dr. Willis was shocked and pointed out that Jesus himself went around healing the sick, to which George responded that Jesus never charged them an annual £700.