Harding

Election of 1920 o Republicans nominated

Warren G. Harding of Ohio (Calvin Coolidge as vice president)o Platform was effectively

ambiguous on the issue of the League of Nations

o Harding spoke of returning America to "Normalcy"

o Conservative "Old Guard" wing of the Republicans now dominated as Teddy Roosevelt’s Progressive.

Democrats nominated James M. Cox of OhioResults: Harding d. Cox 404-127; 16,143,407 to

9,130,328Eugene V. Debs received largest number of

votes for Socialist party (919,799) while sitting in jail

Results displayed public desire for change from idealism, moral overstrain and self-sacrifice.

Isolationists turned results into a death sentence for the League of Nations.

3 Main Scandals

• "Ohio Gang" or "Poker Cabinet“• Col. Charles R. Forbes• Teapot Dome Scandal

Scandal "Ohio Gang" or "Poker Cabinet"

Harding appointed his friends to prominent positions in his cabinet

Harding considered one of the worst presidents in U.S. history.

Most stories of his corrupt administration came out after his death.

- Col. Charles R. Forbes, head of the Veteran’s Bureau and his accomplices looted the gov’t of about $200 million.

Teapot Dome Scandal 1921, Sec. of Interior Albert Fall

arranged transfer of valuable naval oil reserves at Teapot Dome, WY & Elk Hills, CA to Interior Dept.

Fall then leased lands to 2 oilmen and received a bribe of about $400,000

The scandal became public in 1923 and the three men were indicted in 1924

Fall sentenced to one year in jail. Scandal undermined Americans’

faith in the courts & public officials -- "In America everyone is assumed guilty until proven rich.“

Attorney General Harry Daugherty brought to Senate investigation for illegal sale of pardons and liquor permits. He was forced to resign and brought to trial in 1927. Jury twice failed to convict him. Several of his advisors committed suicide rather than

face humiliation for corruption.

IMPORTANT LEGISLATION

• EMERGENCY QUOTA ACT 1921–LIMITS 3% BASED ON 1910 CENSUS–TOTAL 350,000 / YEAR

• FORDNEY-McCUMBER TARIFF 1922 38.9 %RATE

FORDNEY-McCUMBER TARIFF 1922 38.9 %RATE

o Businessmen feared cheap goods coming from a recovering Europe.

o Tariff rates pushed from 27% (Underwood Tariff) to an average of 38.5% (almost as high as the Payne-Aldrich Tariff of 1909).

o Duties on farm produce increasedo President authorized, with the advice of the

fact finding Tariff Commission, to increase duties by as much as 50%.

o Impact

MORE…

• SEPARATE PEACE WITH GERMANY• WASHINGTON CONFERENCE 1921-22–NAVAL REDUCTION 5:5:3 RATIO

CONGRESSIONAL INVESTIGATION

• 1923- HARDING IS IN DEBT• CHARLES FORBES RESIGNS• CHARLES CRAMER, WRITES LETTER TO

HARDING• THEN SHOOTS HIMSELF• HARDING REFUSES TO READ LETTER.

MORE…

• HARDING CONFRONTS JESS SMITH• SMITH GOES HOME, SHOOTS HIMSELF.

HARDING’S FINAL DAYS

• TAKE A TRIP TO ALASKA• TELL HOOVER ABOUT THE FRAUD,

HOOVER TELLS HIM TO CONFESS.• HARDING BECOMES ILL

HARDING DIES• IN HOTEL IN SAN

FRANCISCO• BLOOD CLOT• NATION MOURNS.

COMPARES HARDING TO LINCOLN

CALVIN COOLIDGE BECOMES PRESIDENT

• 2 MONTHS LATER THE SCANDALS ARE REVEALED.

• ADDS TO DISILLUSION OF THE 1920’S

Coolidge

Carried out Harding’s Conservative Programs

• Farm Problem:– Cause:

• Recovery of European farmers brought less demand for U.S. farm products

• Machines facilitated more food production

• Depression hit agricultural sector in 1920s as 25% of farms were sold for debt or taxes

McNary-Haugen Bill• 1924-1928• Bipartisan Congressional “farm bloc” from

agricultural states aimed to help farmers.• Coolidge vetoed it twice• Result: Farm prices stayed down and

disgruntled farmers sought to make a difference in the 1924 elections.

Election of 1924• Party nominated

– Republicans nominated Coolidge– Democrats nominated conservative businessmen John W. Davis– New Progressive Party will nominate Senator Robert “Fighting Bob” La

Follette• Endorsed by the AFL and the shrinking Socialist party• Bulk support came from farmers• Platform

• Results:– Coolidge d. Davis and La Follette• 382 – 136 – 13

– La Follette received nearly 5 million votes– Nation too prosperous for most to be overly

concerned with reform

Muscle Shoals• During WWI the

government had construction a dam and two nitrate plants on the Tennessee River at Muscle Shoals, Alabama (one of nation’s poorest region).

• Both Harding and Coolidge opposed progressive plans for federal development of hydroelectric generating stations on the Tennessee River

• Senator George Norris wanted project owned and controlled by government

• Republicans saw it as too socialistic• The proposal would have significantly improved the economic

plight of the Tennessee Valley region• Muscle Shoals because nucleus of New Deal’s Tennessee

Valley Authority of the 1930s.

Don’t Forget…

• Loans and reparations• Dawes Plan• Kellogg-Briand Pact• McNary-Haugen Bill

Foreign Policy in the 1920s

Tradition Tenants of US Foreign Policy

To what extent were these policies isolationist?

Monroe Doctrine

• 1823 Presidential statement warning European nations not to colonize further the American continents and suggesting that the US would refrain from intervention in European Affairs.

Manifest Destiny

• 1844 slogan of James K Polk that it would be the fate of the US to expand its boundaries from the Atlantic to the Pacific.

Open Door Policy

• 1899 circular note from Secretary of State John Hay to nations with spheres of influence in China that there should be equal trading opportunities for all nations in China.

• Later extended to say it would be the policy of the US to “preserve the territorial integrity of China”

Roosevelt Corollary

• 1904 Presidential extension – or perversion – of the Monroe Doctrine to suggest that in cases of “chronic wrongdoing.” it might be necessary for the US to intervene in Latin American countries to protect America’s new interest in the area.

Dollar Diplomacy

• President Taft’s policy supporting American commercial enterprises abroad, particularly in Latin America and the Far East, with dollars rather than bullets.

Foreign Policy of the 1920s

Ratification of the League Covenant (Article X)

• Information• Findings:

– The Senate found the provision, which was intended to encourage collective action in the event of aggression, particularly objectionable.

– Opponents regarded it as a threat to their role in declaring war– Wilson regarded this provision as essential to the League’s

effectiveness– When the two sides were unable to reach a compromise, the

Senate rejected the Treaty of Versailles, and with it, Article X.– This action appeared to some a return to isolation.

The Washington Conference 1921

• Information• Findings:

– The Big Five nations, including the US, Britain, Japan, France, and Italy, agreed to a 10-year moratorium on the building of large warships and agreed to maintain an established ration of large warships.

– The idealistic and temporary expedient required the US to do most of the scrapping of large vessels and included no provisions for enforcement.

– It appealed to many American taxpayers.

Geneva Conference 1927

• Information• Findings:– The US called this conference to try to extend the

ratio arranged at Washing to smaller vessels.– This attempt failed completely and led quickly to

naval expansion by the US

War Debts: The Dawes and Young Plans

• Information• Findings:– Dawes Plan provided a US loan to Germany to

help that country establish an orderly payment of reparations to European Allies.

– Young Plan reduced substantially the amount Germany was expected to pay.

– Both initiatives by the US were intended to facilitate trade with European in order to protect American economy.

Kellogg-Briand Peace Pact 1928

• Information• Findings:– This pact between France and the US outlawed

war “as an instrument of national policy.”– Although it was signed by most nations of the

world, its lack of provision for enforcement led one historian to compare it to a “letter from Santa Claus.”

Relations with Asia: The Four and Nine Power Pacts

• Information• Findings:– These pacts committed major nations to respect

each other’s interest in the Pacific and reaffirm the Open Door in China

The Caribbean: The Clark Memorandum, December 17, 1928• Information• Findings:– This semi-official statement of the Undersecretary

of State repudiated the interventionist slant of the Roosevelt Corollary and paved the way for the “Good Neighbor Policy” and improved opportunities for favorable trade relations with Latin America.

The Crash 1929

Hoover and the Depression

Election

• Hoover (Republican)• Alfred E. Smith (Democrat)– Tammany Hall boss, Catholic, “Wet” son of Irish

immigrants.• Campaign– Radio used 1st time– “A vote for Al Smith is a Vote for the Pope”

• Hoover d. Smith 444 to 87,– Huge Republican majority was returned to the House of

Representatives.

Hoover on prosperity 1928

• “We live in a day when poverty will be banished from the land.”

• “Capitalism has matured. We will never have another depression.”

• “A chicken in every pot & two cars in every garage”

BOOM TURNS TO BUST

• RARING ECONOMIC GROWTH• NEW PRODUCTS & INDUSTRIES• CONSUMER CREDIT• A “BULL MARKET”– Values of stocks continued to increase during the

1920s.• CONFIDENCE IN THE FUTURE• LIFE IS JUST A BOWL OF CHERRIES

Hoover is a symbol of the times

• Self made man- millionaire businessman• WW I food administrator

– For starving people of Belgium– “Great Engineer”, “Wonder Boy”

• Member of Wilson’s team at Versailles• Member of Harding’s cabinet

– Secretary of Commerce– He supported some progressive ideas e.g. endorsing labor unions

and supporting federal regulation of new radio broadcasting industry

– For a time, considered government-owned radio like Britain’s BBC

• No elective office until President

The 1929 Stock Market Crash

The Causes• Bottom falls out Oct. 24, 1929

– Black Tuesday• Over-speculation• Margin buying

– Investors purchased stocks from stockbrokers for as little as 5% down.– When stock values rose, investors would pay back their debt– Banks loaned money to stockbrokers to facilitate on margin buying.

• Foreign Economic troubles• Poor income distribution• Over-production

The Characteristic of each phase.

• Prosperity• Recession• Depression• Recovery• If you try to interfere you will make

things worse.

Hoover’s Philosophy

• Rugged individualism

• Limited role of government• Depression is caused by failure of

confidence. And foreign economic problems.

Hoover’s Anti-Depression Policies

• Nov. 1929 calls a Business Conference• Slogan: “Prosperity is just around the

corner”

• “The economy is fundamentally sound!”

• Reconstruction Finance Corp. $1.8 Billion

More on Hoover’s Policies...

• Agricultural Marketing Act– Passed June 1929– Designed to help farmers help themselves, largely though

producers cooperatives– Federal Farm Board established– Money lent to farms– Goal: increase sagging prices by buying up surpluses– Failed as production increased.

• Hawley Smoot Tariff 1930– Highest peace-time barrier in the nation’s history.– Exacerbated existing economic depression– International financial chaos.

• Balances the Federal Budget

Hoover becomes symbol of Depression

• Hoover blankets• Hoovervilles• Hoover viewed as a “Do-Nothing

President”

Reconstruction Finance Corporation (RFC)

• Created by Congress in 1932• RFC had appropriation of $500 million and

authority to borrow $1.5 billion for loans to railroads, banks, and other financial institutions

Norris-La Guardia Anti-Injunction Act (1932)

• Passed by Congress and signed by Hoover• Outlawed “Yellow dog” (antiunion) contracts

and forbade the federal courts to issues injunctions to restrain strikes, boycotts, and peaceful picketing

Refusal of Relief (Rugged Individualism)

• Hoover opposed veto use of federal funds for relief for the needy– Feared government handouts would destroy the

nation’s work ethic– Compromised by authorizing RFC to lend $300

million to states for relief and to make loans to states an cities for self-liquidating public works

Foreign Policy Hoover• Japanese attack Manchuria in September

1931• Violated League of Nations covenant as well

as other international agreements• LON condemned the action• Japan left the league

Hoover-Stimson Doctrine (1932)

• Declared U.S. would not recognize any territorial acquisition that were achieved by force; Japan further infuriated as U.S. had conquered territories a few decades earlier.

• Japan continued attacking

Good Neighbor Policy

• Hoover aimed to abandon interventionist policy of TR

• Took a goodwill trip after his election in 1928 of Latin America, abroad a U.S. battleship

• Great Depression meant less money for U.S. investors to spend overseas thus decreasing U.S. interest in economic imperialism

• 1932 negotiated new treaty within Haiti which provided for later withdrawal of U.S. troops in 1934

Bonus Army

• Veterans march on Washington• Hoover called in the Army

Long Term Causes

• Weak Industries• Overproduction of goods by manufacturers• Uneven distribution of income• Unstable banking system• Weak international economy