American History

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Woodrow 's Financial Legacy

Woodrow 's Financial Legacy

Due to New Freedom legacy in the domain of commerce , trade and banking and its socio-economic impact on the American society , Woodrow Wilson is placed parallel with great American presidents like Washington Lincoln , and Franklin Roosevelt . During first four years of his administration from 1913 to 1917 , he tried to put his financial philosophy into practice and struck serious blows at the three pillars of wealth-Tariffs , Trusts and the Banks . For this purpose he enacted a number of laws

After

his inauguration , Wilson called a special session of Congress and got The Underwood Tariff Act (1913 ) passed . This made significant modifications in the federal tax structure and shifted the burden of taxation to those who were able to bear it i .e . from consumers to producers . These structural changes had enduring impact on the American economy . Furthermore , to reconstruct the national banking and currency system , Wilson got the Federal Reserve Act of December 1913 passed . By this the country was divided into twelve districts , each with a Federal Reserve Bank . Each worked under the supervision of Federal Reserve Board . The responsibility of the Federal Reserve Board includes the regulation of monetary policies and to determine the rates of discounts Although some critics , especially the Austrian School , consider it superfluous intrusion in the economy but the same structure of central banking system is followed till today with certain minor structural modifications . It ensured greater public control over the banking than had existed before Federal Reserve Board and created a balance between monopoly of banking groups with vested interest and the domination of government in the financial domain . This act , possibly the most vital domestic realization of Wilson government 's reforms , hitherto offers the regulatory structure for nation 's banks , credit , and money supply

To complete the program of New Freedom , Wilson got the Clayton Anti-trust passed from the Congress in 1914 with a view to combat the vested interests of the Trusts . This act set out to break the big corporations by encouraging competition . Under the Act the corporations were forbidden to acquire shares in other companies which were competing with them . It also forbade deliberate variations in price which was intended to reduce competition . In to implement the provision of Clayton Act , The Federal Trade Commission was established through an act . Its objective also included the consumer protection . Federal Trade Commission remains the prime independent agency hitherto to eliminate the practices that are unhealthy for competitive market

His financial and trade remedies were not foreign to American socio-economic problems but it comprehended these problems and implemented programs that were in alignment with American economic ideals . Collectively , these reforms capacitated the United States to pull alongside with future needs in addition to fulfilling the contemporary requirements . These were the reasons that the monetary regulatory and supervisory apparatus that Wilson developed works hitherto . It echoes a profound dedication to humanization ' of commerce and trade . It generated healthy competitions that resulted in the...