Editing Tariff of 1789 (section)

==Economic conditions prior to passage==
{{Further|Confederation Period}}

The American Revolution was followed by an economic reorganization, which carried in its wake a period of uncertainty and hard times. During the conflict, labor and investment had been diverted from agriculture and legitimate trade to manufacturing and privateers. Men had gone into occupations that ceased with the end of the war. Lowered prices, resulting from the cessation of war demands, in combination with the importation of the cheaper goods of Europe, were fast ruining such infant manufacturing concerns as had sprung up during the war, some of which were at a comparative disadvantage with the resumption of normal foreign trading relations.<ref>Harold Underwood Faulkner, American Economic History, Harper & Brothers, 1938, p. 181</ref>

Another factor which made the situation even  more distressing was the British [[Navigation Acts]]. The only clause in the [[Treaty of Paris (1783)|1783 Paris peace treaty]] concerning commerce was a stipulation guaranteeing that the navigation of the Mississippi would be forever free to the United States. [[John Jay]] had tried to secure some reciprocal trade provisions with Great Britain but without result.  [[William Pitt the Younger|William Pitt]], in 1783, introduced a bill into the British Parliament providing for free trade between the United States and the British colonies, but instead of passing the bill, Parliament enacted the British [[Navigation Act 1783]], which admitted only British built and manned ships to the ports of the West Indies, and imposed heavy tonnage dues upon American ships in other British ports. It was amplified in 1786 by another act designed to prevent the fraudulent registration of American vessels and by still another in 1787, which prohibited the importation of American goods by way of foreign islands. The favorable features of the old Navigation Acts that had granted bounties and reserved the English markets in certain cases to colonial products were gone; the unfavorable ones were left. The British market was further curtailed by the depression there after 1783. Although the French treaty of 1778 had promised "perfect equality and reciprocity" in commercial relations, it was found impossible to make a commercial treaty on that basis. Spain demanded, as the price for reciprocal trading relations, a surrender by the United States for 25 years the right of navigating the Mississippi, a price that the New England merchants would have been glad to pay.

France (1778) and the Netherlands (1782) made treaties but not on even terms; Portugal refused all advances. Only Sweden (1783) and Prussia (1785) made treaties guaranteeing reciprocal commercial privileges.<ref name="faulkner182">Harold Underwood Faulkner, American Economic History, Harper & Brothers, 1938, p. 182</ref>

The weakness of the [[Continental Congress]] under the [[Articles of Confederation]] prevented retaliation by the central government. Congress repeatedly asked for power to regulate commerce, but was refused by the states upon which rested the execution of such commercial treaties as Congress might negotiate. Eventually, the states themselves attempted retaliatory measures, and from 1783 to 1788, New Hampshire, Massachusetts, Rhode Island, New York, Pennsylvania, Maryland, Virginia, North Carolina, South Carolina, and Georgia levied tonnage dues upon British vessels or discriminating tariffs upon British goods. Whatever effect these efforts might have had were neutralized by the fact that the duties varied 0% to 100%, which simply drove British ships to the free or cheapest ports to flood the market with their goods. Commercial war between the states followed and turned futility into chaos.<ref name="faulkner182"/>

Adoption of the Constitution meant the elimination of many of the economic ills under which industry and commerce had struggled since the war. A reorganization was essential and the immediate economic results were salutary. Its most important additions to the power of Congress were those relating to finance and commerce: it enabled the federal government to levy taxes, regulate trade, coin money, protect industry, and direct the settlement of the West, and, as later events proved, to establish credit and redeem its securities. Under it, freedom of trade was ensured throughout the young republic.<ref>Harold Underwood Faulkner, ''American Economic History'', Harper & Brothers, 1938, p. 190</ref>

In the months leading up to the passage of the Tariff Act, Congress received several petitions from different cities representing manufacturing groups asking for relief from the flood of European imported goods.

The United States Congress answered the petitions of these groups for urgent attention, by making the Tariff of 1789 the first major bill to be considered in its first session and passed.