Calvin Coolidge was a firm believer in the economic policy of laissez-faire. This held that governments should, wherever possible, refrain from intervening in the running of the economy. Instead, they should simply set the legal and regulatory framework in which businesses operate, get out of the way, and let businesses get on with what they do best: innovating, investing, and creating jobs.
Like all adherents of laissez-faire, Coolidge believed that this approach was the best way to ensure prosperity. Businesses were far better placed than government officials, he thought, to determine what goods should be produced, where they should be produced, and at what price. Ultimately, it was the unfettered operation of the free market, responding to consumer demand, that would decide the allocation of goods and resources in society.
In practical terms, the policy of laissez-faire seemed to work for Coolidge, as he presided over an impressive period of growth in the American economy. Further down the line, however, his hands-off approach to regulation, especially in relation to the financial services sector, contributed in no small measure to the Wall Street Crash, which took place less than a year after Coolidge left office.
Friday, September 20, 2019
What were Calvin Coolidge's policies?
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