Why did Alexander Hamilton favor imposing high tariffs on foreign goods and creating a national bank?

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mkoren eNotes educator| Certified Educator

Alexander Hamilton supported placing taxes on imported goods and establishing a national bank for a few reasons. By placing taxes on imported goods, the United States government would be able to generate income that could be used to pay our debts and run our country. It also would offer some protection to American industries from competition from European countries. Since our industries were newer than Europe’s industries, the Europeans could make products cheaper than we could make them. Thus, people would buy from other countries instead of from our factories. These taxes would not only generate income for the government, but they would protect our factories from foreign competition.

Alexander Hamilton wanted a national banking system. He knew the government needed a place to put its money. The same was true for businesses and individuals. Without a banking system, our financial system would be less sound. This could negatively impact the economy and our economic growth.

Alexander Hamilton wanted taxes on imports and a national banking system to protect our economy and help our businesses and economy grow.

pohnpei397 eNotes educator| Certified Educator

Alexander Hamilton favored these things because he believed that the US should develop an economy that was mixed, one that had both farms and manufacturing.  He believed that high tariffs on foreign goods would help to bring this about because foreign goods would be kept out and domestic industry could get going.  He believed in a national bank because it would keep the currency stable and create a stable business environment in which business could thrive.  By creating a good business environment and keeping foreign competition away, Hamilton believed that the government could help a mixed economy to develop.  This, he felt, would make America strong.