1. Distant Authority Monetary Policy & the Tariff

2. Today’s Agenda Review Distant Authority Slide Show Homework
Study for Unit Test (Thursday!!!)

3. Review Describe the Gilded Age
Describe the problems farmers had during the 1890s.
Who were the Grangers?
What is the significance of Munn v. Illinois?
What is significant about the Wabash case?
Describe the problems labor had during the Gilded Age.

4. The Gilded Age

5. Today you will be able to:
Identify what a protective tariff is, who would favor it, and why?
Identify differences between Bryan and McKinley Describe the difference between a debtor and creditor and analyze what each would have thought about the money supply.
Explain what a “tight” and “loose” money supply is.
Identify William Jennings Bryan and analyze his “Cross of Gold” speech.
Explain and analyze the results of the election of 1896.

6. Coxey’s Army Presentation

7. What happened to the US economy in 1893?
Panic of 1893
20% unemployment
Cleveland= laissez faire
Jacob S. Coxey
businessman led march of 500 people from Ohio to Washington
Wanted to call attention to high rate of unemployment
Arrested for walking of grass
What does silver have to do with the economy?

8. Panic of 1893 & Coxey’s Army.

9. Describe America’s financial policy in the 1890s.
Tight money policy
U.S.’s money supply based on Gold
Very limited (tight) supply
Hurt farmers most
Food prices had dropped
Mortgage payments remained the same

10. What did the farmers want?
Bi-metalism & a loose money policy
Dollars backed by gold and silver
Would increase supply of money
Make money cheaper
Allow them to pay off their debts

11. Which money policy did eastern bankers favor?
Tight or Gold only money policy
Why?
Less money in supply means that its worth more (has more buying power)
Farmers owed them a “fixed” amount of cash (ex. $1000)
$1000 gets them more if less of it is available

12. What was Grover Cleveland’s attitude towards the economy?

13. What other issue affected farmers and laborers?
Tariffs

14. What is a tariff? A tax on imported goods.
Imported goods= products made in other countries

15. What kinds of tariffs are there?
Protective
intended to keep identified foreign products out of our country so that Americans will “Buy American!”
Revenue
designed to raise money for the country
calculated to be small enough so as not to curtail trade

16. Revenue Tariff Example: The United States imposes a five percent tariff on foreign wine.
Pre tariff price: $20.00 bottle
After tariff price: $21.00 bottle
Result: Demand will probably not drop much for the product and the imposing country will raise funds.

17. An artificial increase in foreign prices
Protective Tariff Example
An artificial increase in foreign prices
Foreign Steel Cost $100 per ton
With 30% Tariff $130 per ton
Domestic Steel Cost $120 per ton
US Sales
Foreign Sales

18. How does a tariff work?
Farmers can buy an American tractor for $100 and English tractor for $130
A steel mill in England makes tractors to sell for $90 each
The US Gov. places a $40 fee (tariff) on each English tractor
A fledgling American factory makes tractors to sell for $100 each
Tractors are transported to America.

19. How will foreign nations react to a protective tariff?
retaliate by imposing tariffs on our exports.
IE. Farm products

20. Owners of Protected Industries
Who is hurt and helped by a protective tariff?
Hurt Helped
Consumers
Owners of Protected Industries
Exporters
Workers in Protected Industries

21. How did protective tariffs hurt farmers?
Made farm products more expensive overseas
Cut their sales in other nations

22. Election of 1896 Presentation

24. Describe the Election of 1896.
Big Issues:
Bi-metalism
Tariff
Candidates
William Jennings Bryan
Great orator
Supported by Democrats and Populists, farmers
Tireless campaigner
William McKinley
Conservative
A friend to big business
Never left front porch

25. What does Bryan mean by a “cross of gold?”
Burn down your cites and leave our farms, and your cities will spring up again as if by magic. But destroy our farms and the grass will grow in the streets of every city in the country…you shall not crucify mankind upon a cross of gold.”
Gold only money policy is crushing (crucifying) the farmers