would rely on funds raised by moderate tariffs, would be the best means of growing manufacturing without decreasing the supply or increasing the prices of goods. Such encouragement by direct support would make American enterprise competitive and independent along with the nation as a whole. In part subsidies would be used for the following: Encourage the nation's spirit of enterprise, innovation, and invention. Support internal improvements, including roads and canals to increase and to encourage domestic commerce. Grow the infant nation to a manufacturing power that would be independent of control by foreign powers by relying on their goods for domestic, especially defense supplies. Adoption by Congress Though Congress refused to accept Hamilton's proposals in 1791 because of opposition from Madison and his supporters, much of Hamilton's third report would later be adopted by the US Congress despite continued opposition to the support of industry by subsidies. Both sides agreed that manufacturing independence was desirable and necessary but disagreed on how to obtain it. The Jeffersonian Democratic-Republican Party's main objection to subsidy was their fear that subsidy would lead to corruption and favoritism of certain sections of the new nation over others: the north over the agrarian south. That divide would return again and again in issues of economic policy until the outbreak of the American Civil War. It is often thought that Hamilton's report was completely ignored, but "Hamilton worked to ensure that Congress enacted virtually every tariff recommendation in the report within five months of its delivery." Hamilton's revenue-based trade policy, with its more moderate tariffs, meant that by 1794, manufacturers had switched their support from the Federalists to the Democratic-Republicans, who favored higher, more protectionist tariffs. Opposition Leading opponents of Alexander Hamilton's economic plan included Thomas Jefferson (until later years) and James Madison, who were opposed to the use of subsidy to industry, along with most of their fledgling Democratic-Republican Party. Instead of bounties they reasoned in favor of high tariffs and restrictions on imports to increase manufacturing, which was favored by the manufacturers themselves, who desired protection of their home market. Although the Jeffersonian stance originally favored an "agrarian" economy of farmers, it changed over time to encompass many of Hamilton's original ideas: Also, "the Madison administration helped give rise to the first truly protectionist tariff in U.S. history." See also First Report on the Public Credit – Hamilton's report on public finance Second Report on