During the 1920s, how did reduction of government involvement in the economy and the election of 1928 shape the decade?

During the 1920s, reduction of government involvement in the economy shaped the decade in that it made the outset of the economic downturn in 1929 much worse. The election of 1928 shaped the decade in that the Republicans were nearly guaranteed the presidency then, given the robust economy, but Hoover was not willing to enact sweeping changes after the economy collapsed in 1929.

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Under the leadership of Harding and Coolidge, government did very little in economic matters. Farmers were left to fend for themselves economically when the bottom fell out of the commodities market due to the abrupt end of WWI. Many farmers, behind on their loans, plowed under acres of poor land...

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Under the leadership of Harding and Coolidge, government did very little in economic matters. Farmers were left to fend for themselves economically when the bottom fell out of the commodities market due to the abrupt end of WWI. Many farmers, behind on their loans, plowed under acres of poor land in order to appease their creditors. This led to falling farm prices as the farmers glutted the market. Without price supports, farmers suffered for much of the decade. The government also did not intervene in the stock market even with speculation and insider trading being common. Hoover requested that banks not take out risky loans in the stock market; however, the previous two administrations did little to intervene in this relationship between banking and investing. This would lead to disaster when banks lost most of their money due to stock market speculation.

Given the success of Republican administrations of the 1920s, it would have taken a miracle for the Democrats to win the White House in 1928. Out of the three Republican administrations of the decade, Hoover was the most progressive. Hoover was considered a financial and organizational genius. Hoover's main flaw was that he was willing to let the market correct itself. Hoover also tightened credit at a time when more lending in the industrial sector would have helped the economy. Hoover also authorized the Hawley-Smoot Tariff, even though it hurt potential customers of American goods abroad. Hoover did this in order to protect American industries from cheaper imports.

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