Question 142

The federal government lowered tariff rates and began to depend more on income tax for revenue.

During President Woodrow Wilson's administration, one significant change in economic policy was the reduction of tariff rates and an increased reliance on income tax for government revenue.

A) The federal government lowered tariff rates and began to depend more on income tax for revenue.

This option accurately reflects the economic reforms enacted during Wilson's presidency, particularly through the Underwood Tariff Act of 1913, which significantly reduced tariffs and implemented a graduated income tax. This shift aimed to promote fair competition and reduce reliance on tariffs, which were seen as regressive.

B) The federal government introduced agricultural price supports and production controls to help farmers.

This statement is incorrect as it does not align with Wilson's policies. While agricultural issues were relevant during his administration, there were no significant federal programs for price supports or production controls for farmers at that time. Such measures became more prominent in later years, particularly during the New Deal era.

C) The federal government removed the dollar from the gold standard.

This option is inaccurate because Wilson did not remove the dollar from the gold standard. The United States remained on the gold standard throughout his presidency, and any major changes regarding the gold standard occurred in the 1930s, long after his administration.

D) The federal government passed the Full Employment Act to guarantee employment to all United States citizens.

This statement is also incorrect. The Full Employment Act was enacted in 1946, well after Wilson's administration. During Wilson's time, there was no such federal guarantee of employment for citizens.

E) The federal government concluded the North American Free Trade Agreement to facilitate trade with Latin American countries.

This option is incorrect as NAFTA was established in 1994, decades after Wilson's presidency. Wilson's administration did not engage in such an agreement, as it was focused on domestic economic reform and issues related to World War I.

Conclusion

The correct answer, A, represents a key economic reform during Wilson's presidency, demonstrating a shift toward lower tariffs and the establishment of an income tax system. All other options misrepresent the policies of his administration or refer to developments that occurred long after his time in office, underscoring their inaccuracy.