Editing Andrew Mellon (section)

===Coolidge administration===
{{see also|Presidency of Calvin Coolidge}}
[[File:Calvin Coolidge cph.3g10777 (cropped).jpg|thumb|President [[Calvin Coolidge]] favored Mellon's economic policies]]

As the economy recovered from recession and began to experience the prosperity of the [[Roaring Twenties]], Mellon emerged as one of the most renowned figures in the Harding administration. One admiring congressman referred to Mellon as the "greatest Secretary of the Treasury since [[Alexander Hamilton]]".<ref>Cannadine (2006), pp. 309–310</ref> Harding died after suffering a stroke in August 1923, and he was succeeded by Vice President [[Calvin Coolidge]]. Mellon enjoyed closer relations with President Coolidge than he had with President Harding, and Coolidge and Mellon shared similar views on most major issues, including the necessity for further tax cuts.<ref>Cannadine (2006), pp. 311–315</ref> [[William Allen White]], a contemporary journalist, stated that "so completely did Andrew Mellon dominate the White House in the days when the Coolidge administration was at its zenith that it would be fair to call the administration the reign of Coolidge and Mellon."<ref name="Keller 1982, p. 777">Keller (1982), p. 777</ref>

Coolidge, Mellon, business organizations, and administration allies conducted a publicity campaign designed to convince wavering congressmen to support Mellon's tax plan.<ref name="murnane833836840841"/> Their efforts were opposed by the coalition of Democrats and progressive Republicans that exercised effective control over the [[68th United States Congress|68th Congress]].<ref>Cannadine (2006), p. 315</ref> In February 1924, the House Ways and Means Committee approved of a bill based on Mellon's plan, but an alliance of progressive Republicans and Democrats engineered passage of an alternative tax bill written by Democrat [[John Nance Garner]]; Garner's plan also reduced income taxes but set the top marginal tax rate at 46% rather than Mellon's preferred 33%. In June 1924, Coolidge signed the [[Revenue Act of 1924]], which contained the income tax rates of Garner's bill and also increased the [[Estate tax in the United States|estate tax]]. Coolidge signed the bill but simultaneously called for further tax cuts.<ref name="murnane833836840841">Murnane (2004), pp. 833–836, 840–841</ref> Congress also rejected Mellon's proposed constitutional amendment that would have barred the issuance of tax-exempt securities and, over Coolidge's veto, authorized a bonus to World War I veterans. Mellon did, however, win one legislative victory, as he convinced Congress to create the [[United States Tax Court|Board of Tax Appeals]] to adjudicate disputes between taxpayers and the government.<ref>Cannadine (2006), pp. 315–316</ref>

Mellon had originally planned to retire after one presidential term but decided to remain in the cabinet in the hope of presiding over the full enactment of his taxation proposals.<ref>Murray (1975), pp. 227–228</ref> In the [[1924 United States presidential election|1924 presidential election]], the Republicans campaigned on further tax cuts, while both the Democrats and third-party candidate [[Robert M. La Follette|Robert La Follette]] denounced Mellon's tax proposals as "a device to relieve multi-millionaires at the expense of other taxpayers".<ref>Murnane (2004), p. 841</ref> Buoyed by the strong economy, and overcoming the [[Presidency of Warren G. Harding#Administration scandals|scandals of the Harding years]], Coolidge won re-election by a decisive margin.<ref>Cannadine (2006), p. 317</ref> Coolidge saw his victory as a mandate to pursue his favored economic policies, including further tax cuts.<ref name="Keller 1982, p. 777"/>

When Congress reconvened after the 1924 elections, it immediately began working on another bill designed to lower tax rates on the highest earners.<ref>Murnane (2004), p. 851</ref> In February 1926, Coolidge signed the [[Revenue Act of 1926]], which reduced the top marginal rate to 25%. Mellon was extremely pleased by the passage of the act, because, unlike the Revenue Act of 1921 and the Revenue Act of 1924, the Revenue Act of 1926 closely reflected Mellon's proposals. In addition to cutting tax rates on top earners, the act also raised the personal exemption for federal income taxes, abolished the [[Gift tax in the United States|gift tax]], reduced the estate tax rate, and repealed a provision that had required the public disclosure of federal income tax returns. Meanwhile, the booming economy fostered a $400 million budget surplus in 1926, and the country's national debt dropped from $24 billion in early 1921 to $19.6 billion at the end of fiscal year 1926.<ref>Cannadine (2006), pp. 317–318</ref> Government revenues increased considerably under Mellon's plan, largely collected from higher-income earners.<ref>"The facts are unmistakably plain, for those who bother to check the facts. In 1921, when the tax rate on people making over $100,000 a year was 73 percent, the federal government collected a little over $700 million in income taxes, of which 30 percent was paid by those making over $100,000. By 1929, after a series of tax rate reductions had cut the tax rate to 24 percent on those making over $100,000, the federal government collected more than a billion dollars in income taxes, of which 65 percent was collected from those making over $100,000." Thomas Sowell (2012). ''"Trickle Down Theory" and "Tax Cuts for the Rich"''.  The Hoover Institution Press, ISBN 978-0-8179-1615-2, p. 3</ref>

With his top priority of tax reform accomplished, Mellon increasingly turned over management of the Treasury Department to his deputy, [[Ogden L. Mills]].<ref>Cannadine (2006), p. 355</ref> After the 1926 elections, Mellon and Mills sought to cut the corporate tax and fully repeal the estate tax. The [[Revenue Act of 1928]] did indeed cut the corporate tax, but the estate tax was left unchanged.<ref>Cannadine (2006), pp. 357–358</ref> Mellon also focused on the construction of new federal buildings, and his efforts led to the construction of several buildings in the [[Federal Triangle]].<ref>Cannadine (2006), pp. 372–375</ref> In 1928, Mellon stated that "in no other nation, and at no other time in the history of the world, have so many people enjoyed such a high degree of prosperity or maintained a standard of living comparable to that which prevails throughout this country today."<ref>Cannadine (2006), p. 364</ref>

Responsibility for foreign relations lay with the State Department rather than the Treasury Department, and [[Benjamin Strong Jr.]] and other central bankers took the lead with regard to international monetary policy, but Mellon nonetheless exercised some influence in foreign affairs.<ref>Cannadine (2006), p. 279</ref> He strongly opposed the cancellation of European debts from World War I but recognized that Britain and other countries would be unable to pay those debts without a renegotiation of terms. In 1923, Mellon and British [[Chancellor of the Exchequer]] [[Stanley Baldwin]] negotiated an agreement in which Britain promised to pay off the debts over a 62-year period.<ref>Cannadine (2006), pp. 289–290</ref> After the adoption of the [[Dawes Plan]], Mellon reached debt settlements with several other European countries. After protracted negotiations, the United States and France agreed to the [[Mellon-Berenger Agreement]], which reduced France's debt and set terms for repayment.<ref>Cannadine (2006), pp. 319–321</ref>