In November of 1952 General Dwight D. Eisenhower was elected to the office ofPresident of the United States. It was the first time a Republican was elected sinceHerbert Hoover in 1928.
The Eisenhower administration started at a rather awkwardtime, both politically and economically. First of all there was a war on. The Korean Warhad begun in June of 1950 and was still waging. As was usual for wartime the countrywas economically prosperous.
However, the war had caused President Truman toabandon his former restraints on government spending. The amount of money beingspent on defense skyrocketed to supply the troops in Korea with the supplies they needed. This caused the federal deficit to increase dramatically (Pach and Richardson, 53). Another legacy leftover from the Truman days was that of the Fair Deal domesticprogram. Although Truman found much opposition to his programs in Congress hemanaged to get several things done. Such as a public housing bill, an expansion of socialsecurity coverage, and increased minimum wages.
The Republican party was not in favorof the majority of this legislation. Thus when Eisenhower was elected they immediatelymade plans for cutbacks in the spending on these programs. Unfortunately for them thenewly elected president was not opposed to the programs Truman had began andimproved upon. Over the course of his administration Eisenhower often did not hold thesame opinions as some of the members of his party.
As the Chief Economic advisor to the President of the United States there aremany different issues which I must consider. These issues are both large and small,foreign and domestic, and affect the upper, middle, and lower classes. At this point intime there are several important concerns which I have. The Korean War is ending andthis is going to have a profound affect on the economy of the United States. During thewar the country was prosperous but afterward there is always a high risk of increasedinflation and an increase in unemployment. These conditions have the ability to cause arecession.
Now that an armistice has been reached in Korea, a recession is beginning tooccur (Pach and Richardson, 54). I believe that the President’s chief concern should not be to make an immediateand fast acting restoration of the general economy. The problems of the federal deficitand the recession must wait until the more important problems are dealt with. Theproblem at hand is the rising rate of unemployment. This problem must be dealt withimmediately with strong actions. I suggest implementing federal public works projectsas a way of creating jobs without burdening the government with additional expenses.
Ideas for these public works projects are: the construction of a Saint Lawrence Seaway,and an Interstate Highway System. This system would be a massive undertaking andwould be one of the largest construction projects of all time but it would create many jobsfor Americans who are no longer employed by the war effort (Branyan and Larsen, 251). The Republican party has not been happy with the nations economic policies forquite some time.
These are the policies of the Democrats, and more specifically those ofthe New Deal and the Fair Deal. These social programs, such as social security andwelfare have been a drain on the federal budget for quite some time. Republicans feelthat the time has come to start cutting back the amount of money being spent on suchprograms or at least curtail the yearly increases. However, there are times when apolitical leader must make their own decisions and not base the way they run theiradministration on the influences from their party. It would be better for the economichealth of the nation to maintain all of the social programs started under the Roosevelt andTruman administrations.
While this would normally pose a problem to the federal budgetit will not due to current conditions. The amount of money formerly spent on nationalsecurity, meaning military and defense spending has been severely reduced (Albertson,139). This frees up a large amount of money to be used for other goals. These goalsshould be those of improving the standard of living for each and every American and notthe immediate reduction of taxes, a goal which many members of the Republican partywould like to see pursued.
The programs initiated in the policies of the New Deal andFair Deal should not simply be maintained, instead they should be expanded upon. Isuggest that the Social Security system be amended to include benefits for self-employedfarmers and disabled workers. While there is much work to be done on economic policy domestically, theforeign policy must be dealt with as well. One of the most important aspects of foreigneconomic policy is that of trade. There are different ways for a government to legislatetrade. It can be done from a protectionist position or from a more free trade position. In aprotectionist position the government is aiming to ensure American businesses and at thesame time decrease the amount of sales of foreign business.
The fastest method foraccomplishing this task is to increase tariffs, as in taxes on foreign goods coming in to thecountry. When these taxes are high it costs the foreign companies much more to shipgoods into the United States. In order to compensate these costs the companies mustincrease the price of their goods. When people in American see foreign goods foroutrageous prices and then they see American goods for normal prices than they are goingto buy American products.
Unfortunately, this is not the only effect of a protectionistpolicy. Foreign nations often get upset at the increase in American tariffs and respond byincreasing their own tariffs on American goods. This weakens the sales of Americangoods in foreign nations.
In order for the United States to have a favorable balance oftrade then they must have strong exports. This is where a free trade policy comes in. In afree trade policy, tariffs are lowered, allowing more goods to be imported to the UnitedStates. Foreign nations will see the lowered tariffs in the United States and respond bylowering their tariffs on American goods. This will increase the overall trade between theUnited States and nations abroad. The Republican party would like to see a return to more protectionist policies.
However, I feel it should be the job of the President to guide the Grand Old Party awayfrom such a viewpoint (Bonker, 58). Instead of trying to increase tariffs, PresidentEisenhower should attempt to renew the Reciprocal Trade Act so that he will have thepower to lower tariffs by as much as fifteen percent. With the tariffs lowered foreigncountries will respond favorably. This will produce more commerce and be beneficial tothe United States balance of trade. Another measure that should be taken in order tobolster American trading and overseas investments is to decrease the corporate taxes to apercent much lower than the domestic rate on income earned through foreign subsidiariesof U.
S. businesses. Trade is essential to overcome the dollar gap that prevented foreignmarketing of United States goods (Melanson and Mayers, 159). There are many economic issues which face the nation at this time. A recoveryfrom World War II and the Korean War, a recession, a change in the political party of thepresident, and several other issues. Thus this must be a time of strong economicleadership. The policies made and legislature passed must steer the United States throughthis apparent storm and give the nation a chance to rest from the hecticness of the firsthalf of the century. For in that half a century the country faced World War I, World WarII, and the Great Depression.
Now is a time when the nation must rest up and regain itsstrength for the most assuredly hard times to come. During President Eisenhower’s termin office one word must describe the economic policy, stability. The country does notneed risky ventures and bold new ideas, the country needs to hold on to its previouseconomic standpoints. The only new policies implemented should be those to combatnew issues that arise during the Eisenhower presidency. Thus all of the economic adviceI have given the President Eisenhower serves one main purpose. That is to ensure theeconomic stability and prosperity of the United States of America. In 1953 I took office and began to serve as President Eisenhower’s chiefeconomic advisor.
I quickly assessed the economic stature of the nation and began toplan my policies for the future. I was aware of what I wanted to accomplish and how Iplanned to achieve my goals. I advised the President on many key and importanteconomic issues of our time. When I think back I must decipher whether or not thepolicies I implemented were successful. At the time I thought what I was doing was rightbut as the saying goes “hindsight is twenty-twenty” and I can only truly tell if I wassuccessful by looking back upon my work and taking an overview of it.
As I look back upon my time in office I come to a very distinct conclusion. Ibelieve that I was successful in achieving the economic goals which I set out for. Through my suggested policies regarding social security I made Americans more securein their jobs and their government. Through my suggested policies regarding worksprograms I created countless jobs for Americans who desperately needed them, especiallyin a time directly after a major war. In regards to foreign economic policy I was also verysuccessful. The trading of the United States was booming. U.
S. products were beingproduced and sold around the world. By the 1956 fiscal year the Treasury showed animpressive surplus (Pach and Richardson, 55). The success of the nation’s economywould prove to be imperative for the time. As the country entered the Cold War the focusneeded to be placed on the Soviet Union, national security, and defense. The economyhad to be stable because we could not afford to worry about its well being in a time ofsuch political strife.
The United States had very specific needs during the fifties. Thecountry needed a strong military to compete with the Soviet Union, a strong governmentto legislate, and a strong economy to back it all up. The policies I helped to implementwere the ones that met the needs of the times.
After a war a nation needs stability and mypolicies and programs provided this stability which allowed the United States toadequately recover from World War II and the Korean War so that the country would beable to fight future battles. Works Cited List Albertson, Dean. Eisenhower As President.
New York: Hill and Wang, 1963Ambrose, Stephen E. Eisenhower. New York: Simon and Schuster, 1970Bonker, Don. America’s Trade Crisis.
Boston: Houghton Mifflin Company, 1988Branyan, Robert L., Larsen, Lawrence H. The Eisenhower Administration 1953-1961. New York: Random House, 1971Melanson, Richard A., Mayers, David.
Reevaluating Eisenhower American ForeignPolicy in the 1950s. Urbana and Chicago: University of Illinois Press, 1987Pach, Chester J. Jr., Richardson, Elmo. The Presidency of Dwight D.
Eisenhower. Kansas: University Press of Kansas, 1991