nov 1, 1894 - Depression Politics: Gold Reserve and Tariff

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Gold reserves at the U.S. Treasury dropped to a low level as result of investors trading in silver dollars for gold dollars. President Cleveland was pushed to repeal the Sherman Silver Purchase act of 1890, but it did not fix the issue. he relied on J.P Morgan to borrow a sum of $65 million in gold to support the gold standard. Americans interpreted this deal as the government being a tool to reach eastern bankers. The Wilson-Gorman tariff decreased tears rates and placed a 2% income tax on incomes the exceeded $2000. The average American income during this time was fewer than $1000 so only the small number of people who had high incomes would be affected by the tax. The Supreme Court declared the income tax unconstitutional within a year, however.

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