Ch. 5, Sec. 4
 “Freedom
is something more than being
left alone. Without the watchful and
resolute interference of the government,
there can be no fair play between
individuals and such powerful institutions
as the trusts”
 Teddy
Roosevelt, unhappy with Taft, runs for
re-election as a “third party” candidate
 T.R.’s Bull Moose Party splits the republican
vote in half
 Wilson wins as the democrat candidate
 Wilson plans to attack trusts, tariffs, and
high finance
 His program is called “New Freedom”
A
corporation could no longer buy the stock
of another if doing so created a monopoly
 Unions have a right to exist and are not
subject to antitrust laws
 Legalized
federal income tax
 Required because of tariff reduction
 Created
the Federal Trade Commission (FTC)
which had the power to investigate unfair
business competition and practices
1. The nation needed a way to adjust the
amount of money in circulation
 Too much money = higher inflation
 Less money = banks close, economy slows
2. The nation needed a way to make loans
more available outside the financial centers
of New York and Boston.
 More loans on credit = more economic
opportunity
 The
Federal Reserve solved both these
problems
 It established a de-centralized banking
system under federal control
 “The Fed” are the banks for commercial
banks
 12
Federal Reserve banks have the power to
control the money supply through buying and
selling treasury bonds
 The Federal Reserve board adjusts interest rates
at which banks borrow money from each other
 Lower rate = more loans for business and
individuals
 Establishment
of The Fed is the Wilson
administration’s most enduring achievement