us policy: 1920-1932 the politics of normalcy. harding’s fiscal policy harding was committed to...
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Harding’s Fiscal PolicyHarding was committed
to the free enterprise system Characterized by private
ownership of property, including land & resources
Relies on competition for profits & the forces of supply & demand to determine what goods & services should be produced & at what price
A REPUBLICAN ERA BEGINS
The Postwar Recession EndsHarding worked with Congress to cut taxes
and control spending Repealed taxes meant to fund WWI Reduced spending by $1 billion Used the surplus to pay down the national debt
Harding’s policies brought renewed prosperity to the US Prices plunged, allowing people to afford more Unemployment dropped from 12% (1920) to 2% (1923)
A REPUBLICAN ERA BEGINS
The Teapot Dome Scandal
Harding’s cabinet, the “Ohio Gang,” brought scandal to the White House Harding gave Albert Fall
control over national oil reserves
Fall leased those reserves to 2 companies that had paid him $360,000 in bribes
Fall resigned when the scandal went public
Harding stood by Fall until own death in 1923
A REPUBLICAN ERA BEGINS
Coolidge Promotes Business
As president, Coolidge worked to cut taxes & control spending Pushed for reductions in
corporate, income, & inheritance taxes
Cut the White House budget
Under Coolidge, the nation continued to prosper
A REPUBLICAN ERA BEGINS
Hoover Promises to End Poverty
Like Harding & Coolidge, Hoover believed in promoting business Wanted industry leaders to
work to together to improve economic effi ciency
Hoped that as businesses flourished, poverty would disappear
A REPUBLICAN ERA BEGINS
The US Economy Booms
Under the economic policies of Republican presidents, the postwar recession faded away Productivity increased
dramatically Unemployment dropped Wages rose to double
what they had been before the war
THE REPUBLICAN BOOM YEARS
The Age of Mass Production
The automobile industry led this new age of productivity By 1929, at least half of
all American families owned a car
Made possible by Henry Ford’s moving assembly line which allowed him to increase wages & cut prices
THE REPUBLICAN BOOM YEARS
New Industries AriseThe growth of the
automobile industry fueled new industries as well The steel, rubber, & oil
industries expanded Highway construction
boomed Restaurants & hotels
sprang up along roads Service industries, such
as gas stations & repair shops, were created
THE REPUBLICAN BOOM YEARS
Businesses Get Bigger
During the 1920s, businesses grew due to a wave of consolidation Harding, Coolidge, &
Hoover ignored anti-trust laws
Allowed businesses to merge
Led to the rise of the Big 3 automakers in the US
Created chain stores in the grocery industry, etc.
THE REPUBLICAN BOOM YEARS