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PinkMonkey Study Guide - American History

11. 8 The Eisenhower Administration at Home

When Eisenhower was elected to the office of President in January 1953, his entry marked the 20 year old Democratic control on the administration of America. By electing the Republican candidate Eisenhower, the American people had indicated that they wanted a change. The new administration did not make any basic changes in the policies of the previous governments. For instance, the new government headed by Eisenhower was committed to economize and reduce taxes. At the same time, it continued to follow the social welfare program introduced under the New Deal and the Fair Deal. This is evident from the fact that President Eisenhower sponsored many improvements in the social security programs, allocated financial resources for roads, education and housing. Further, the new government wished to check expenditure on foreign, economic and military aid. To the foreign threat of communism, it did not make any change in it.

Reducing control on the economy

Wage controls that were adopted by the Congress during the Korea war were lifted in February 1953. Later price controls were also lifted from many goods. The Defense Production Act (1950), enacted to strengthen the economy so as to support the Korean War was allowed to lapse. The Reconstruction Finance Corporation, which was active right through the Depression and the war, stopped all its activities. But the rent controls continued in areas where there was a severe shortage of housing.

State Control of offshore Oil Deposits

Considered to be the most controversial law passed in the first few months of Eisenhower’s government, it gave the states the right to control offshore and tidelands oil deposits. President Truman had vetoed the Bill during his tenure and it had become a major election issue in 1952.

The National Debt, taxes and the budget

The Congress wished to reduce taxes. But the new President, believed that taxes should not be reduced until the budget was balanced. Eisenhower, along with Senator Taft were able to convince the Congress to extend the excess profit tax. The new government also tried to cut expenditure on defense on foreign aid, but could not succeed in doing so.

The St. Lawrence Sea-way and Power Project

The proposal to connect the Great Lakes with the Atlantic Ocean through the St. Lawrence River had been debated for over a quarter of a century. This project also included the proposal for the construction hydroelectric power plants. Though both Roosevelt and Truman were in favor of the project, and even conducted talks with Canada, the Congress had not been very keen on it. So in 1953, Canada decided to proceed with the project without waiting for the Congress to give a nod. President Eisenhower successfully persuaded the Congress to give the New York State the right to join hands with the Ontario province, to build dams and hydroelectric plants. The electricity generated was to be shared between New York and Ontario. A separate agreement was made with New York that it make some of the electric power available to neighboring states. In 1954, the Congress gave its approval for the St. Lawrence seaway project as a joint U.S.-Canada program. The Project helped in converting many inland cities like Buffalo, Cleveland, Chicago, Detroit, Toledo and Milwaukee into seaports, accessible to most ocean going ships.

Other Achievements of the Eisenhower Administration

President Eisenhower followed a middle path policy. Very often, due to this policy, a combination of moderate Republicans and moderate Democrats gave the President the support he needed. Inspite of opposition from his own party members (Republicans) he succeeded in extending the Reciprocal Trade Agreement - initially for one year and again for a period of three years.

Besides, the number of people covered under the social security program were also increased under his tenure.

In 1953, the Congress formed the Small Business Administration to help defend the interests of small businesses and provide loans to them. In 1954, the government increased the minimum wage rate to one dollar per hour. The insurance and mortgage processes under the Housing Act was liberalized to encourage the buying of houses. A provision was also made to build 45,000 low cost housing units by 1956.

In 1956, the Federal Highway Bill made provision for the construction of highways during the next 13 years to connect cities with a population of 50,000 and more. The federal government was to allocate $ 20 billion to the states as finance to build the super highways. The law also provided two and half billion dollars for the construction of primary, secondary and rural roads. To help generate additional resources for this government program, the Federal Gasoline Tax was hiked from 3 to 4 cents a gallon.

In 1952, the Congress had passed the McCarren-Walter Immigration and Nationality Act after over-riding the President’s veto. Still the Act remained a subject of major controversy. In 1953, the Act was liberalized to allow 214,000 immigrants into the country above the specified quota during the next three years. The aim of this law was to accept in the US people leaving countries under communist or socialist control.


Agriculture in the country during this period made some significant achievements in terms of increased production. At the same time the farmers’ income continued to fall sharply. This was because the production of farm commodities had far surpassed the demand in the market.

In the 2 terms that Eisenhower was President, farm income fell by 25%. This, despite the fact that the government had invested $8,500,000,000 in surplus crops. Government aid through subsidies did not help as the average farm made only $2,364 in 1959. It is not surprising that between 1940 and 1960, the farm population dropped from 30 million people (approximately) to 15,635,000.

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Table of Contents

11.0 - Chronology of Major Events in this Period
11.1 - Conditions at Home
11.2 - The Employment Act
11.3 - The Taft-Hartley Labor Management Relations Act
11.4 - The Truman's Civil Rights Program
11.5 - The McCarthy Period
11.6 - The Cold War Abroad
11.7 - The Korean War
11.8 - The Eisenhower Administration
11.9 - The Civil Rights movement and the question of Desegregation
11.10 - The Labor Reform act
11.11 - The Budget
11.12 - The Economy in the 60s
11.13 - The Communist Threat Abroad
11.14 - The Threat of Nuclear War
11.15 - The Exploration of Outer Space
11.16 - The Geneve Conference on Disarmament
11.17 - Our WorldToday


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