Chapter 21 Normalcy and Good Times

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Chapter 21Normalcy and Good Times

• Section 3
• The Policies of Prosperity

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Promoting Prosperity

• Andrew Mellon, sec. of treasury, reduced govt
  spending cut the federal budget.
• The federal debt was reduced by 7 billion b/w
  1921 1929.

3
Promoting Prosperity

• Mellon applied the idea of supply-side economics
  to reduce taxes.
• This idea suggested that lower taxes would allow
  businesses and consumers to spend and invest
  their extra money, resulting in economic growth.
• In the end the govt would collect more taxes at
  a lower rate.

4
Hoovers Cooperative Individualism

• Sec of Commerce Herbert Hoover attempted to
  balance govt regulation with cooperative
  individualism.
• Manufacturers and distributors were asked to form
  their own trade associations and share
  information with the federal govts Bureau of
  Standards.

5
Trade and Arms Control

• By the end of the 1920s, Allies owed the U.S.
  billions of in war debt.
• Many Americans favored isolationism rather than
  involvement in international politics and issues.
• We wanted to be left alone to our own prosperity,
  but we are too interconnected.

6
The Dawes Plan

• The U.S. argued that the Allies gained
  territories and received reparations, or huge
  cash payments that Germany paid as punishment for
  starting the war.

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The Dawes Plan

• American diplomat banker, negotiated a plan
  with France, Britain, and Germany by which
  American banks would make loans to Germany to
  meet the reparations payments.

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The Dawes Plan

• In return, France and Britain agreed to accept
  less reparations and pay more on their war debts.
• Plan didnt work, all countries went further into
  debt to the U.S.

9
The Washington Conference

• Held in 1921 and invited countries to discuss the
  ongoing postwar naval arms race.
• Charles Evan Hughes proposed a 10-year
  moratorium, or pause, on construction of new
  ships.

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The Washington Conference

• The conference, however, did nothing to limit
  land forces.
• Three treaties came from the conf.
• Know the chart on p 649
• Japan was angry that the conference required
  Japan to keep a smaller navy than the U.S. or
  Britain.

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Abolishing War

• The Kellogg-Briand Pact was a treaty that
  outlawed the war.
• Countries agreed to stop war and settle all
  disputes in a peaceful way.
• Aug 27, 1928, the U.S. and 14 other nations
  signed it, and eventually 62 nations ratified it.

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End of Chapter 21

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