Republicans were in power for years with the support of the business community. Regulation of business was inadequate and a bubble developed in the economy. Eventually the bubble burst, leading to economic crisis and years of unemployment in the United States. Did this occur in:
A. After the Civil War
B. In the 1920s
C. In the 2000s
D. All of the above.
Answer: All of the above.
A. After the Civil War Republicans dominated the U.S. governments, with only one Democrat elected president. The one Democrat elected president during the period, Grover Cleveland, managed to establish the Interstate Commerce Commission in 1887, but the ICC was largely ineffective for years in part due to the conservative Supreme Court. In the 1880s, there was a railroad bubble leading eventually to a crash in the market for railroad stocks That led to the panic of 1893 which was followed by years with high levels of unemployment.
B. During the 1920s, in which Republicans dominated the U.S. government, the largely unregulated stock market experienced a bubble which crashed in 1929. That led to the Great Depression of the 1930s.
C. The Reagan revolution, led to Republican control of the U.S. Government (with only one Democratic president) between 1981 and 2009. In the 2000s the financial industry was deregulated and began to issue subprime mortgage loans and their derivatives. This led to a housing bubble, and eventually the crash of the financial industry in 2008. This has been followed by the Great Recession in which we are now living.
The only extended period of Democratic control of the U.S. Government was from the Election of Franklin Delano Roosevelt in 1932 to the election of Richard Nixon in 1968. In that 36 year period, only one Republican (President Eisenhower) was elected president. During that period, regulation of the stock market and the banks was established, full employment was reestablished, and the economy grew greatly.
Fool me once, shame on you. Fool me twice, shame on me!
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