Omar 1800s Chapter 6 PDF

Roosevelt’s Progressivism: Theodore Roosevelt, President of the USA (1901-1909), introduced reforms to give middle class Americans a “square deal” and prevent large companies like Standard Oil (Rockefeller) from abusing their control over the market place. ▪ Elkins Act (1903) an...

Roosevelt’s Progressivism: Theodore Roosevelt, President of the USA (1901-1909), introduced reforms to give middle class Americans a “square deal” and prevent large companies like Standard Oil (Rockefeller) from abusing their control over the market place. ▪ Elkins Act (1903) and Hepburn Act (1906) – to stop railroads from offering preferential treatment to customers like Standard Oil. Taft and the Sherman Anti-Trust Act: William Howard Taft, President of the USA (1909-1913) continued Roosevelt’s work by breaking up trusts – large corporations that exerted monopolies. ▪ The Sherman Anti-Trust Act (1890) was to prevent collusion and monopolies between competing companies in an industry and to prevent a single company from dominating a market (anti-competitive behavior) ▪ Taft used the Sherman Anti-Trust Act to force Standard Oil to break up into 34 smaller independent companies. Clayton Act ( 1914) made labour unions and agricultural organizations exempt from the Sherman Anti-Trust – so boycotts, strikes, picketing, and collective bargaining legal as long as peaceful. The Roaring Twenties: The USA was focused on economic prosperity and wanted to distance itself from political upheaval in other parts of the world (isolationism). Equality of opportunity – everyone could attain prosperity if they worked hard. Political Conservatism: Harding and Coolidge 1921 Warren G. Harding, a conservative Republican became president of the USA. He promised a “return to normalcy” based on isolationism – a retreat from involvement on the world stage; nativism – favoring dominant culture and the reduction of immigration; and a reduction of government involvement in the lives of citizens. (elected by widest margin in history) Revenue Act 1921 – reduced income taxes and repealed excess profits tax that had been applied to corporations during WWI. Emergency Quota Act 1921 – reduced immigration by 75% (tried to preserve existing ethnic composition – immigrate only 3% of number of citizens in the USA already from that country. Fordney-McCumber Tariff Act 1922 – protection of American business and agriculture from foreign competition. Calvin Coolidge (VP) assumed Presidency when Harding died in 1923 and elected president in 1924. Coolidge – laissez-faire and classical liberal economic policies in his administration. Revenue Acts 1924 and 1928 further reduced income tax. Vetoed Congress over subsidies for farmers. Immigration Act 1924 further reduced immigration (2% not 3%) and banned immigration from Asia entirely. Government Responses to the Depression in Canada Prime Minister Bennett (Conservative) was elected in 1930 with his promise to make work projects to deal with unemployment. Relief camps were established, but he then cut government spending in his belief that the economy left alone would fix itself. He did however create the Bank of Canada which took over the country’s money supply and used interest rates to try to regulate the economy. Bennett also tried to arrest left wing groups not trusting the activities of the Communist Party. By 1935 Bennett realized things were not improving so started to introduce programs like Roosevelt – such as the Employment and Social Insurance ACT (declared unconstitutional by courts) – and then lost the election in 1935 to William Lyon Mackenzie King. Under King and his “minister of everything” C.D. Howe the government got more involved in the economy creating social programs – UI, Family Allowance, CHMC - ( and laying the foundations for the modern mixed economy. ▪ Used unemployed to build airstrips ▪ Crown corporations such as Trans-Canada Air (Air Canada), CBC, Bank of Canada, NFB, and reforming the CNR. ▪ Established 28 Crown corporations during WWII increasing employment Quebec Premier Maurice Duplessis (1936-1939) started a farm credit program, fair Monetarism: Friedman and Hayek This shift back toward classical liberal laissez faire economics in the form of monetarism began in the 1970s as a result of government's’ inability to deal with stagflation. Simply put, the difference between In Canada this shift is reflected in the policies of Ralph these theories is that monetarist Klein (AB), Mike Harris (Ont) and Prime Minister Stephen economics involves the control of Harper – as they attempted to undo the interventionist money in the economy, while Keynesian economics involves policies of previous governments. government expenditures.... Both of Monetarist theory = control of the country’s money these macroeconomic theories directly supply is the best means to encourage economic growth impact the way lawmakers create fiscal and limit unemployment and inflation. and monetary policies The money supply is controlled through the regulation of interest rates. Milton Friedman believes that inflation is the result of an excess supply of money produced by central banks. He argues that an increased money supply leads to increased consumer spending, leading to increased demand, leading to increased inflation. Friedrich Hayek believed that excessive government control of the economy would lead to government Question: 1 and 2