Tariffs and Economic Growth ❖ Tariffs provided the bulk of treasury revenue ➢ Tariff income erased the debt from the Civil War and generated huge budget surpluses ❖ Democrats argued that tariffs taxed American consumers by denying them access to low cost imported goods ➢ Republicans claimed that tariffs benefited workers because they created jobs, blocked low-wage foreign competition and safe-guarded America from industrial poverty ■ Men could earn enough to support their families ■ Wives could devote themselves to home- making ■ children could go to school and not the factory ❖ Actual benefits of the tariffs ➢ Economic growth ➢ Transformed the United States into a global industrial power ❖ Actual downfalls ➢ Had not prevented industrial poverty ➢ Corporations gained lots of money but the workers never saw that money, despite the long hours they worked The Role of the Courts ❖ Munn v. Illinois (1877) ➢ Supreme Court affirmed that states could regulate key businesses ■ Railroads & grain elevators ■ The justices feared that too many state and legal regulations would impede business and fragment the national marketplace ❖ Starting in the 1870s, the “due process” from the 14th amendment was being put into place. ❖ Peones ➢ A lot of land in New Mexico and Arizona were in the
Gold standard: paper notes from the Bank of England could be backed by gold held in bank’s vaults Homestead Act: gave 160 acres of federal land to any applicant who occupied and improved the property Morrill Land Grant Act: hands of Mexican farmers ➢ They lived as peones ■ Under long-standing agreements with landowners who held large tracts originally granted by the Spanish crown ❖ Congress set up a special court to rule on land tiles ➢ Mexican-Americans lost about 64% of the contested lands ❖ Santa Fe Ring ➢ Much land was sold or appropriated through legal machinations like this notorious cabal of politicians and lawyers ■ Displacement of thousands of Mexican American villagers and farmers ● Some found work as railroad builders or mine workers ● Others developed sheep raising as a major enterprise Silver and Gold ❖ European policymakers sought new ways to rationalize markets ❖ Governments agreed that money should be based on gold because it has a higher value than any other type of money ➢ Great Britain had a gold standard ➢ During the 1870s and 1880s, the US, Germany, France and other countries converted to using gold money ■ Before this, they used both gold and silver coins
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