Final answer:
President Wilson played a pivotal role in defining government's involvement in business, focusing on breaking up monopolies through legislation like the Clayton Antitrust Act, establishing the FTC, and reforming banking via the Federal Reserve Act. He aimed to protect small businesses, encourage financial stability, and manage wartime production.
Step-by-step explanation:
Thomas Woodrow Wilson asserted that the government's role in regulating business was primarily to dismantle monopolies rather than merely regulate them. Wilson believed that instead of making the federal government bigger, large businesses should become smaller, thereby giving more freedom and opportunities to small businesses.
This belief was reflected in legislation such as the Clayton Antitrust Act of 1914, which strengthened the earlier Sherman Antitrust Act by specifically targeting monopoly practices while exempting labor unions. Additionally, the establishment of the Federal Trade Commission (FTC) provided a federal agency the authority to investigate and enforce such regulations.
Furthermore, Wilson's commitment to financial reform materialized with the Federal Reserve Act of 1913, which established a decentralized banking system under federal control.
He also saw reduced competition as a consequence of high tariff rates, and acted on this by passing the Underwood Tariff, significantly reducing tariffs. During World War I, Wilson also established the War Industries Board to ensure adequate military supplies and compel private firms to contribute to the war effort.