Economic Independence
>Industrial Revolution made the U.S. more economically independent>In the early 1800s foreign relations also affected American economy
Embargo, war and tariffs
>1807 congress passed the Embargo act, which cut off all foreign trade for 2 years>1812 U.S. went to war with Great Britain and the British blocked the American ports
>The war of 1812 ended and many British goods were in the U.S.
>The Congress passed the Tariff of 1816 to protect the new American industry from British competition
>The Americans placed taxes on imported goods, making the ironware, paper, woolen and cotton goods from Britain more expensive than the U.S. goods.
The Second National Bank
>Most new industries were financed by small investors>The new businesses needed banks
>The first bank of the U.S. had expired in 1811
>The bank faced opposition from the Republicans
>Madison (The President) learned to accept the bank
>In 1816 congress chartered the second national U.S. bank
>The new bank had the power to establish a national currency and to make large loans to businesses
>Helped strengthen economic independence of the nation
