Hamilton Tariff

George Washington on July 4, 1789 signed the Act which was passed by the first Congress there by making it into a law. This act along with other financial acts of 1789 had a dual purpose of protecting the trade and bringing in revenue for the federal government. Alexander Hamilton, the then Secretary of Treasury ,was a financial genius and worked out financial plans that could establish credit to pay the nation's debts, encourage commerce and manufacturers. The flow of cash would help individuals and small businessmen to get loan at a cheaper rate. He proposed the opening of the Bank of the United States in which the government would be a major share holder. The circulation of the paper currency printed by the bank would promote business and trade. He also proposed the tariff on all goods that were imported in order to protect the interest of the Northern manufacturers, thereby causing difficulties to the Southern farmers who had to sell those products at a higher rate. These tariffs depended on the goods and it ranged from 5 to 10 percent of the estimated value of the goods sold. All this caused a rift in the Federalist Party and it can be sited as an important cause for the Civil War.