Tariff
A tariff is called an optimal tariff if it's set to maximize the welfare of the country imposing the tariff. It is a tariff derived by the intersection between the "trade indifference curve" of that country and the offer curve of another country. In this case, the welfare of the other country grows worse simultaneously, thus the policy is a kind of "beggar thy neighbor policy". If the offer curve of the other country is a line through the origin point, the original country is in the "condition of a small country", so any tariff worsens the welfare of the original country.
Tariff of 1789
The import fees "represented a compromise between the advocates of a high protective tariff and those who favored a tariff for revenue only [to maintain the central government]." Charges up to fifty percent were imposed on selected manufactured and agricultural goods, including "steel, ships, cordage, tobacco, salt, indigo [and] cloth." On the majority of items subject to duty, a five percent fee was levied, "ad valorem". Molasses, an indispensable ingredient for Northeastern rum producers, was lowered from 6¢ per gallon to 2.5¢. 
Madison modified the terms of the tariff to balance sectional conflicts but conceded that articles subject to high duties "were pretty generally taxed for the benefit of the manufacturing part of the northern community." He acknowledged the South, the main wealth-producing part of the nation, would inevitably "shoulder a disproportionate share of the financial burden involved in the transforming the United States into a commercial, manufacturing, and maritime power."