The Politics of Boom and Bust,...

Chapter31ThePoliticsofBoomandBust,1920–1932

I.TheRepublican“OldGuard”Returns

• WarrenG.Harding,inauguratedin1921,lookedpresidential:– Foundhimselfbeyondhisdepthinpresidency• Unabletodetectmoralfaultsinassociates• Couldnotsaynoanddesigningpoliticiansleechedontothisweakness• Washingtoncouldnottellalie,Hardingcouldnottellaliar• Promisedtogatheraroundhim“bestminds”

I.TheRepublican“OldGuard”Returns(cont.)

– CharlesEvansHughes:• Masterful,imperious,incisive,brilliant• Broughttopositionofsecretaryofstateadominatingconservativeleadership

– AndrewW.Mellon:• NewsecretaryofTreasury

– HerbertHoover:• FamedfeederofBelgiansandwartimefoodadministrator• Becamesecretaryofcommerce

I.TheRepublican“OldGuard”Returns(cont.)

• Raisedhissecond-ratecabinetposttofirst-rateimportance• Especiallyindrummingupforeigntradeformanufactures

• Harding's“worstminds”:– SenatorAlbertB.Fall:• Schemingantconservationist• Appointedsecretaryofinterior• Asguardianofnation'snaturalresources,heresembledwolfhiredtoprotectsheep

I.TheRepublican“OldGuard Returns(cont.)

– HarryM.Daugherty:• Big-timecrookin“OhioGang”• Supposetoprosecutewrongdoersasattorneygeneral

II.GOPReactionattheThrottle• Hardingaperfect“front”forindustrialists:– NewOldGuards:• Hopedtocrushreformsofprogressiveera• Hopedtoimproveonoldbusinessdoctrineoflaissez-faire• Wantedgovernmenttokeepitshandsoffbusiness• Wantedgovernmenttoguidebusinessalongpathtoprofits– Achievedgoalbyputtingcourtsandadministrativebureausinsafekeepingoffellowstand-patters

II.GOPReactionattheThrottle(cont.)

– Hardinglivedlessthanthreeyearsaspresident:• Appointedfourofninejustices:• Fortunatechoiceforchiefjusticewasex-presidentTaft,whoperformeddutiesablyandwasmoreliberalthansomeofhisassociates

– SupremeCourtaxedprogressivelegislation:• Killedfederalchild-laborlaw• Strippedawaymanyoflabor'shard-wongains• Rigidlyrestrictedgovernmentinterventionineconomy

• LandmarkcaseAdkinsv.Children'sHospital(1923):– ReverseditsreasoninginMullerv.Oregon(seeChap.28):

» Whichdeclaredwomenneededspecialprotectioninworkplace» Toinvalidateminimum-wagelawforwomen» Reasoning:becausewomenhadvote(19thAmendment),theywerelegalequalofmenandcouldnolongerbeprotectedbyspeciallegislation

– Twocasesframeddebateovergenderdifferences:» Werewomensufficientlydifferentfrommenthattheymeritedspeciallegalandsocialtreatment?

» Orweretheyeffectivelyequalineyesoflawandundeservingofspecialprotectionsandpreferences?

– Corporationscouldoncemorerelaxandexpand:• Antitrustlawsignored,circumvented,orfeeblyenforcedbyfriendlyprosecutors• InterstateCommerceCommissiondominatedbymensympathetictomanagersofrailroads• Bigindustrialistsstrivedtoreducerigorsofcompetitionthroughtradeassociations• Althoughassociationsrancountertospiritofantitrustlaws,theirformationencouragedbyHoover

• Hoover'sefficiency:– Ledhimtocondemnwasteresultingfromcutthroatcompetition

– Hiscommitmenttovoluntarycooperationledhimtourgebusinessestoregulatethemselvesratherthanberegulatedbybiggovernment

III.TheAftermathofWar

• Wartimegovernmentcontrolsoneconomyswiftlydismantled:–WarIndustriesBoarddisappeared• Withitspassing,progressivehopesformoregovernmentregulationofbigbusinessevaporated

– Returnedrailroadstoprivatemanagementin1920• Crushedhopeforpermanentnationalization• CongresspassedEsch-CumminsTransportationAct:

– Encouragedprivateconsolidationofrailroads

III.TheAftermathofWar(cont.)

– PledgedInterstateCommerceCommissiontoguaranteerailroadprofitability

– Newphilosophywastosaverailroads

– Governmenttriedtogetoutofshippingbusiness:– MerchantMarineAct(1920)authorizedShippingBoardtosellmostofhastilybuiltwartimefleet

– Boardoperatedremainingvesselswithoutmuchsuccess– UnderLaFolletteSeaman'sAct(1915),Americanshippingcouldnotthriveincompetitionwithforeignshipping

• Lackinggovernmentsupport,laborlimpedalongbadlyinpostwardecade:– Bloodysteelstrikecrushedin1919– RailwayLaborBoardcutwages12%in1922• Whenworkersstruck,AttorneyGeneralDaughertyclampedinjunctiononstrikers

– Needyveteransreapedlastinggainsfromwar:• Congress(1912)createdVeteransBureautooperatehospitalsandprovidevocationalrehab

• Veteransorganizedintopressuregroups• AmericanLegiondemonstratedmilitantpatriotism,rock-ribbedconservatism,zealousantiradicalism,and• Aggressivepushforveterans'benefits,especially“adjustedcompensation”tomakeupforwageswhileinservice• Wonwith1924passageofAdjustedCompensationAct:• Gaveformersoldiersapaid-upinsurancepolicyduein20years• Added$3.5billiontocostofwar

IV.AmericaSeeksBenefitsWithoutBurdens

• Makingpeacewithfallenfoe:– U.S.A.,havingrejectedTreatyofVersailles,technicallyatwarwithGermany,Austria,andHungary:• In1921Congresspassedsimplejointresolutionthatdeclaredwarover• IsolationenthronedinWashington• ContinuedtoregardLeagueasunclean• HardingatfirstevenrefusedtosupportLeague'sworldhealthprogram

IV.AmericaSeeksBenefitsWithoutBurdens(cont.)

– SecretaryHughessecuredforU.S.oilcompaniesrighttoshareinMiddleEastoilexploitations

– DisarmamentanissueforHarding:• Businessmendidnotwanttofinancenavalbuildingprogramstartedduringwar• Washington“DisarmamentConference”1921-1922:

– InvitationssenttoallbutBolshevikRussia– AgendaincludednavaldisarmamentandsituationinFarEast– Hughesdeclared10-year“holiday”onconstructionofbattleships– Proposedscaled-downnaviesofAmericaandBritainwithparity– Ratio5:5:3forU.S.A.,England,andJapaninFivePowerTreaty,1922

Figure 31-1 p723

– Four-PowerTreaty–pactboundBritain,Japan,France,andUnitedStatestopreservestatusquoinPacific

– China—“SickManoftheFarEast”—helpedbyNine-PowerTreaty(1922),whosesignatoriesagreedtonailwide-openOpenDoorinChina

– Conferenceimportant,but:» Norestrictionsonconstructionofsmallerwarships» Congressmadenocommitmenttouseofarmedforce

• Kellogg-BriandPact(1928):– SecretaryofstateFrankB.KelloggwonNobelPeacePrizeforhisrole;KelloggsignedPactwithFrenchforeignminister

• Newparchmentpeacedelusory:– Defensivewarsstillpermitted– Pactadiplomaticderelictandvirtuallyuseless– ReflectedAmericanmind(1920s):• Willingtobelulledintofalsesenseofsecurity• Sameattitudeshowedupinneutralismof1930s

V.HikingtheTariffHigher• BusinesspeoplesoughttokeepU.S.markettothemselvesbythrowinguptariffwalls– Fordney-McCumberTariffLaw:• Lobbyistswantedtoboostaveragefrom27%to38.5%,almostashighasTaft'sPayneAldrichTariffof1909• Dutiesonfarmproduceincreased• Flexibility:presidentcouldincreaseordecreasedutiesasmuchas50%• HardingandCoolidgemorefriendlytoincreasesthanreductions

V.HikingtheTariffHigher(cont.)

• Insixyears,theyauthorized32upwardcharges• Duringsametime,theyorderedonlyfivereductions

– High-tariffcoursesetoffchainreaction:• Europeanproducersfeltsqueeze• ImpoverishedEuropeneededtosellitsmanufacturedgoodstoUnitedStatestobeabletorepaywardebts

• AmericaneededtogiveforeigncountriesachancetomakeaprofitinordertobuyU.S.exports

• Internationaltrade,Americansslowtolearn,atwo-waystreet

V.HikingtheTariffHigher(cont.)

• Americanscouldnotselltoothersunlesstheyboughtfromthem—orlentthemmoreU.S.dollars• TariffsagametwocouldplayasEuropeansrespondedwithhighertariffs• WholeEuropean-Americantariffbattledeepenedinternationaleconomicdistress,providingonemorerungonladderbywhichAdolfHitlerscrambledtopower

VI.TheStenchofScandal

• Loosemoralityandget-rich-quickismofHardingeraresultedinseriesofscandals:

• 1923ColonelCharlesR.ForbesforcedtoresignasheadofVeteransBureau– Lootedgovernmentof$200million,chieflyinbuildingofveterans'hospitals

– Sentencedtotwoyearsinfederalpenitentiary• TeapotDomescandal:

– InvolvedpricelessnavaloilreservesatTeapotDome(Wyoming)andElkHills(California)

VI.TheStenchofScandal (cont.)

– SecretaryofinteriorAlbertFallinducedsecretaryofnavytotransferpropertiestoInteriorDepartment

– Hardingsignedsecretorder– FallleasedlandstooilmenHarrySinclairandEdwardDohenybutnotuntilhereceivedbribe(“loan”)of$100,000fromDohenyandaboutthreetimesthatamountfromSinclair

– TeapotDomefinallycametowhistlingboil» Fall,Sinclair,andDohenyindicatedin1924» Casedraggedonuntil1929» Fallfoundguiltyoftakingbribe,sentencedtooneyearinjail

» Twobribegiversacquittedwhilebribetakerconvicted» Sinclairservedseveralmonthsinjailforhaving“shadowed”jurorsandforrefusingtotestifybeforeSenatecommittee

– AcquittalofSinclairandDohenyunderminedfaithincourts• ScandalofAttorneyGeneralDaugherty:

– Senateinvestigation(1924)ofillegalsaleofpardonsandliquorpermits

– Forcedtoresign,triedin1927,butreleasedafterjurytwicefailedtoagree

• Hardingsparedfullrevelationofiniquities:– EmbarkedonspeechmakingtouracrosscountryallthewaytoAlaska• Onreturn,hediedinSanFranciscoonAugust2,1923

– Brutalfact:Hardingnotstrongenoughforpresidency—ashehimselfprivatelyadmitted

– ToleratedpeopleandconditionsthatsubjectedRepublictoitsworstdisgracesincedaysofPresidentGrant

VII.“SilentCal”Coolidge

• VicePresidentCoolidgeswornintoofficebyhisfather:

• EmbodiedNewEnglandvirtuesofhonesty,morality,industry,andfrugality• Seemedtobecrystallizationofcommonplace• Hadonlymediocrepowersofleadership• Speechesinvariablyboring• TruetoRepublicanphilosophy,hebecame“highpriestofgreatgodBusiness”

VII.“SilentCal”Coolidge (cont.)

• Hands-offtemperament;apostleofstatusquo• ThriftynaturecausedhimtosympathizewithSecretaryofTreasuryMellon'sefforttoreducetaxesanddebts• CoolidgeslowlygaveHardingregimebadlyneededmoralfumigation• Coolidgenottouchedbyscandals

VIII.FrustratedFarmers

• Farmersinboom-or-bustcycleinpost-wardecade– Peacebrought:• Endtogovernment–guaranteedhighpricesandmassivepurchasesbyothernations• Foreignproductionreenteredstreamofworldcommerce

– Machines:• Threatenedtoplowfarmersunderavalancheofoverabundantcrops

VIII.FrustratedFarmers(cont.)

• Gasoline-enginetractorrevolutionizedfarms:– Couldgrowbiggercropsonlargerareas– Improvedefficiencyandexpandedacreagepiledupmoreprice-dampeningsurpluses

– Witheringdepressionsweptthroughagriculturaldistrictsin1920s,whenonefarminfoursoldfordebtortaxes

• Schemesaboundedforbringingrelieftohard-pressedfarmers:– Bipartisan“farmbloc”fromagriculturalstatescoalescedinCongressin1921andsucceededingettingsomehelpfullawspassed

VIII.FrustratedFarmers(cont.)

• Capper-VolsteadAct:– Exemptedfarmers'marketingcooperativesfromantitrustprosecution

• McNary-HaugenBill(1924-1928):– Soughttoboostagriculturalpricesbyauthorizinggovernmenttobuyupsurplusesandsellthemabroad

– Governmentlossestobemadeupbyspecialtaxonfarmers– Congresstwicepassedbill– Coolidgetwicevetoedit– Farmpricesstayeddown;farmers'politicaltemperaturesstayedhigh,reachingfeverpitchinelectionof1924

IX.AThree-WayRacefortheWhiteHousein1924

• Electionof1924:– Republicansnominated“SilentCal”atsummerconventioninCleveland

– DemocratshaddifficultychoosingcandidateatconventioninNewYorkbecausesplitby:• “Wets”vs.“drys”• Urbanitesvs.farmers• Fundamentalistsvs.Modernists• Northernliberalsvs.southernstand-patters• Immigrantsvs.old-stockAmericans

IX.AThree-WayRacefortheWhiteHousein1924(cont.)

• DemocratsfailedbyonevotetopassresolutioncondemningKuKluxKlan• Deadlockedforunprecedented102ballots,conventionturnedtoconservativeWallStreetlawyerJohnW.Davis• Fieldwide-openforaliberalcandidate:

– SenatorRobert(“FightingBob”)LaFollettesprangforthtoleadnewProgressiveparty

– GainedendorsementofAmericanFederationofLabor– SupportfromshrinkingSocialistparty– Farmershismajorconstituency

– LaFollette'sProgressiveparty:• Fieldedonlyapresidentialticket• Nocandidatesforlocaloffice• ProvedshadowofrobustprewarProgressivecoalition• Platformcalledforgovernmentownershipofrailroadsandreliefforfarmers• Lashedoutatmonopolyandantlaborinjunctions• UrgedconstitutionalamendmenttolimitSupremeCourt'spowertovoidlawspassedbyCongress

• Electionreturns:• LaFollettepollednearlyfivemillionvotes• “CautiousCal”andoil-smearedRepublicansover-whelmedDavis:15,718,211to8,385,283• Electoralcountstoodat382forCoolidge,136forDavis,andthirteenforLaFollette,allfromhishomestateofWisconsin(seeMap31.1)• ProsperityunderminedLaFollette'sreformmessage

Map 31-1 p728

X.Foreign-PolicyFlounderings• IsolationcontinuedtoreigninCoolidgeera:

• SenatenotallowAmericatoadheretoWorldCourt• Coolidgehalfheartedlyandunsuccessfullypursuedfurthernavaldisarmament• InterventioninCaribbeanandCentralAmerica:

– Troopswithdrawn(aftereight-yearstay)fromDominicanRepublicin1924

– RemainedinHaiti(1914-1934)– AmericainNicaraguaintermittentlysince1909;Coolidgebrieflyremovedtroopsin1925,butin1926hesentthembackwheretheystayeduntil1933

– OilcompaniesclamoredformilitaryexpeditiontoMexicoin1926,butCoolidgeresisted;U.S.-Mexicantensionsincreased

X.Foreign-PolicyFlounderings (cont.)

– Internationaldebtsovershadowedallforeign-policyproblemsin1920s:• Complicatedtangleofprivateloans,Alliedwardebts,andGermanreparationspayments(seeFigure31.2)• 1914:U.S.A.adebtornationtosumof$4billion• 1922:U.S.A.acreditornationtosumof$16billion

Figure 31-2 p729

X.Foreign-PolicyFlounderings (cont.)

• Americaninvestorsloaned$10billiontoforeignersin1920s,butmostinvestmentremainedwithinU.S.A.• Keyknotindebttanglewas$10billionU.S.TreasuryhadloanedtoAlliesduringwar– AlliesprotestedU.S.demandforrepaymentasunfair– FrenchandBritishstressedtheyhadsufferedtremendouslossesagainstcommonfoe

– America,theyargued,shouldwriteoffloansaswarcosts– BorroweddollarsfueledwartimeboominU.S.economy,wherenearlyallAlliedpurchaseshadbeenmade

– Finalstraw,protestedEuropeans,wasAmerica'spostwartariffsmadeitalmostimpossibleforEuropeanstosellgoodstoearndollarstopaydebts

XI.UnravelingtheDebtKnot

• Allieddebtsaffectedpolicyonreparations:– FrenchandBritishdemanded$32billioninreparationspaymentsfromGermany

– AllieshopedtousemoneytosettlewardebtssinceU.S.A.demandedrepayment

– AsGermanysufferedtremendousinflation,someEuropeansproposeddebtsandreparationsbescaleddownorevencanceled

– Coolidgerejectedanyideaofdebtcancellation

XI.UnravelingtheDebtKnot(cont.)

• DawesPlan(1924):• NegotiatedbyCharlesDawes,abouttobeCoolidge'srunningmate• RescheduledGermanreparationspayments• OpenedwayformoreprivateAmericanloanstoGermany• Wholefinancialcyclebecamemorecomplicated:

– U.S.bankersloanedmoneytoGermany,– GermanypaidreparationstoFranceandBritain,– FormerAlliespaidwardebtstoUnitedStates

XI.UnravelingtheDebtKnot(cont.)

• WhenU.S.loansdriedupaftercrashof1929,jungleofinternationalfinancequicklyturnedtodesert• PresidentHerbertHooverdeclaredone-yearmoratoriumin1931,butmostdebtorssoondefaulted– Except“honestlittleFinland,”whichstruggledalongmakingpaymentsuntillastofdebtdischargedin1976

• UnitedStatesneverdidgetitsmoney,butharvestedbumpercropofillwill

XII.TheTriumphofHerbertHoover,1928

• 1928presidentialrace:– Coolidgedecidednottorun– HerbertHooverbecameRepublicancandidate:• Nominatedonplatformofprosperityandprohibition

– DemocratsnominatedAlfredC.Smith• “Al(cohol)Smith,”soakinglyanddrippingly“wet”whencountrystilldevotedto“nobleexperiment”ofprohibition• Seemedtobeabrasivelyurban• WasRomanCatholic

XII.TheTriumphofHerbertHoover(cont.)

– Radioplayedkeyroleincampaignforfirsttime:– HelpedHoovermorethanSmith

– Hooverdecriedun-American“socialism”• Preached“ruggedindividualism”• Neverhavingbeenelectedtopublicoffice,hewasthin-skinnedinfaceofcriticism• Didnotadapttogive-and-takeofpoliticalaccommodation• Realpowerlayinhisintegrity

– Hishumanitarianism– Hispassionforassemblingfacts

– Hisefficiency– Histalentforadministration– Hisabilitytoinspireloyaltyincloseassociateswhocalledhim“theChief”

• Hooverbestbusinessperson'scandidate:– Self-mademillionaire,herecoiledfromanythingsuggestingsocialism,paternalism,or“plannedeconomy,”

– Yetassecretaryofcommerce,heexhibitedsomeprogressiveinstincts:» Endorsedlaborunions» Supportedregulationofradiobroadcastingindustry» Flirtedwithideaofgovernment-ownedradio

– Indicationsoflow-levelcampaigners:• ReligiousbigotryagainstSmith'sCatholicism

– WhiteHousewouldbecomebranchofVaticanwith“Rum,Romanism,andRuin”

• Southshiedawayfrom“cityslicker”AlSmith– Electionreturns:• Hoovertriumphedinlandslide:

– Bagged21,391,993popularvotestoSmith's15,016,169– Electoralcountof444toSmith's87

• BigRepublicanvictory;HooversweptfiveformerConfederatestatesandallBorderStates(seeMap31.2)

Map 31-2 p731

XIII.PresidentHoover'sFirstMoves

– Hoover'sself-helpresponsestounorganizedwageearnersanddisorganizedfarmers

– AgriculturalMarketingAct(June1929):• Designedtohelpfarmershelpthemselvesthroughproducers'cooperatives• SetupFederalFarmBoardwithrevolvingfundof½billiondollarsatitsdisposal• Moneylenttofarmorganizationsseekingtobuy,sell,andstoreagriculturalsurpluses

XIII.PresidentHoover'sFirstMoves(cont.)

– In1930FarmBoardcreated:• GrainStabilizationCorporationandCottonStabilizationCorporation• Bolstersaggingpricesbybuyingupsurpluses• Suffocatedbyavalancheoffarmproduce

– HooverduringcampaignpromisedtocallCongressintosessiontobringabout“limited”changeintariff

• Hawley-SmootTariff(1930):– BytimepassedbybothhousesofCongress:• Turnedouttobehighestprotectivetariffinnation'speacetimehistory• Averagedutyonnon-freegoodsraisedfrom38.5%tonearly60%• Toforeigners,itwasblowbelowtradebelt:

– Seemedlikedeclarationofeconomicwaronentireworld– Reversedpromisingworldwidetrendtowardreasonabletariffs

– PlungedbothAmericaandothernationsdeeperintodepressionthathadalreadybegun

– IncreasedinternationalfinancialchaosandforcedUnitedStatesfurtherintobogofeconomicisolationism

– Andeconomicisolationism,bothathomeandabroad,playedintohandsofhate-filledGermandemagogue,Hitler

XIV.TheGreatCrashEndstheGoldenTwenties

– Speculativebubble:• Fewpeoplesensedpermanentplateauofprosperitywouldsoonbreak• Pricesonstockexchangecontinuedtospiralupward• Createdfool'sparadiseofpaperprofits• Afewtriedtosoundwarnings

– CatastrophiccrashinOctober1929:• PartiallycausedbyBritishwhoraisedinterestrates• Foreigninvestorsanddomesticspeculatorsbegantodump“insecurities”

XIV.TheGreatCrashEndstheGoldenTwenties(cont.)

• TensionsbuilttopanickyBlackTuesdayofOctober29,1929:– 16,410,030sharesofstockssoldinsave-who-mayscramble– WallStreetbecamewailingwallasgloomanddoomreplacedboom

– Suicidesincreasedalarmingly– Unbelievablelossesinbluechipsecurities– Byendof1929,stockholderslost$40billioninpapervalues(seeFigure31.3)

Figure 31-3 p733

• Stock-marketcollapseheraldedbusinessdepression:– Athomeandabroad– MostprolongedandprostratinginAmericanorworldexperience– Nootherindustrializednationsufferedsosevereasetback– Endof1929:fourmillionworkersjobless– Twoyearslater,figurehadtripled– Hungryanddespairingworkerspoundedpavementsinsearchofwork

– Miseryandgloomincalculable– Over5,000bankscollapsedinfirstthreeyears– Carryingdownwiththemsavingsoftensofthousandsofordinarycitizens

– Countlessthousandslosthomesandfarmstoforeclosure– Breadlinesformed;soupkitchensdispensedfood– Familiesfeltstress,asjoblessfathersnursedguiltandshameatnotbeingabletoprovideforfamily

– Breadlessbreadwinnersblamedthemselvesforplight– Mothersnursedfewerbabiesasbirthratedropped

XV.HookedontheHornofPlenty• WhatcausedGreatDepression?– Overproductiononbothfarmandfactory• Depressionof1930soneofabundance,notwant• “Greatglut”or“plagueofplenty”• Nation'sabilitytoproducegoodsclearlyoutrancapacitytoconsumeorpayforthem• Toomuchmoneygoingintohandsofwealthy:

– Whoinvesteditinfactoriesandotheragenciesofproduction– Notenoughgoingintosalariesandwagestorevitalizepurchasingpower

XV.HookedontheHornofPlenty(cont.)

– Overexpansion:• Ofcredit(installment-plans)overstimulatedproduction• Newlaborsavingtechnologiescausedunemployment

– Economicanemiaabroad:• BritainandContinentneverfullyrecoveredfromWWI• Chain-reactionfinancialcollapseinEurope• Internationaltradedeclinedbecauseoftariffs• Europeanuncertaintiesoverreparations,wardebts,anddefaultsonloansowedtoAmerica• ManyoftheseconditionscausedbyUncleSam'snarrow-visionedpolicies

– Nature:droughtscorchedMississippivalleyin1930• Thousandsofhomesandfarmssoldatauctionfortaxes• Farmtenancyorrental—aspeciesofpeonage—spreadamongbothwhitesandblacks

– By1930sdepressionhadbecomenationalcalamity• Manycitizenslosteverything• Wantedtowork—buttherewasnowork

• America's“uniqueness”nolongerseemedsounique,noritsManifestDestinysomanifest:– DepressionabafflingwraithAmericanscouldnotgrasp

– Initiativeandself-respectstifled– Manysleptintin-and-papershantytownscynicallynamedHoovervilles

– FoundationsofAmerica'ssocialandpoliticalstructuretrembled

XVI.RuggedTimesforRuggedIndividualists

• Hoover'sexaltedreputationaswonder-workerandefficiencyengineercrashed–WouldhaveshoneinprosperousCoolidgeyears– GreatDepressionprovedtobebeyondhisengineeringtalents• Distressedbywidespreadmisery• As“ruggedindividualist,”heshrankfromheresyofgovernmenthandouts

XVI.RuggedTimesforRuggedIndividualists(cont.)

– Convincedthatindustry,thrift,andself-reliancewerevirtuesthatmadeAmericagreat• Fearedthatgovernmentdolingoutdoleswouldweaken,perhapsdestroy,nationalfiber• Reliefbylocalgovernmentagenciesbrokedown• Hooverfinallyhadtoreluctantly:

– Turnfromdoctrineoflog-cabinindividualismand– Acceptpropositionthatwelfareofpeopleduringanationalcatastropheadirectconcernofnationalgovernment

XVI.RuggedTimesforRuggedIndividualists(cont.)

• Hooverworkedoutcompromisebetween– Oldhand-offphilosophy– And“soul-destroying”directdolebeingusedinEngland– Hewouldassisthard-pressedrailroads,banks,andruralcreditcorporation» Iffinancialhealthrestoredattopofeconomicpyramid» Unemploymentwouldberelievedatbottomontrickle-downbasis

– Partisancriticssneeredat“GreatHumanitarian”

XVI.RuggedTimesforRuggedIndividualism(cont.)

– MostofcriticismofHooverunfair:• Hiseffortsprobablypreventedmoreseriouscollapse• Hisexpendituresforrelief,revolutionaryforday,pavedpathforenormousfederaloutlaysofhissuccessor,FranklinRoosevelt

XVII.HooverBattlestheGreatDepression

• Hoover's“trickle-down”philosophy:– RecommendedCongressvoteimmensesumsforusefulpublicworks• SecuredfromCongressappropriationstotaling$2.25billionforsuchprojects• MostimposingofpublicenterpriseswasgiganticHooverDamonColoradoRiver– Hugeman-madelakeforpurposesofirrigation,floodcontrol,andelectricpower

– Sternlyfoughtallschemeshethought“socialistic”

XVII.HooverBattlestheGreatDepression(cont.)

• ConspicuouswasMuscleShoalsBill:– DesignedtodamTennesseeRiver– Hevetoedmeasurebecauseheopposedgovernmentsellingelectricityincompetitionwithprivatecompanies

– In1932CongressrespondedtoHoover'sappeal:• EstablishedReconstructionFinanceCorporation(RFC):

– Provideindirectreliefbyassistinginsurancecompanies,banks,agriculturalorganizations,railroads,andevenhard-pressedstateandlocalgovernments

– Topreserveindividualcharacter,noloanstoindividuals

– “Pump-priming”loanshelped,butprojectslargelyself-liquidating

– Governmentprofitedtotuneofmanymillionsofdollars– Giantcorporationsalsobenefited

• IronythatthriftyandindividualisticHooveractuallysponsoredprojectwithstrongNewDealishflavor

• Norris-LaGuardiaAnti-InjunctionAct(1932):– Outlawed“yellow-dog”(antiunion)contracts– Forbadefederalcourtstoissueinjunctionstorestrainstrikes,boycotts,andpeacefulpicketing

• Hooverdidinauguratenewpolicy:• Byendofterm,hehadstarteddownroadtowardgovernmentassistanceforneedycitizens—aroadFranklinRooseveltwouldtravelmuchfarther

• Hoover'swoes:– IncreasedbyhostileCongress– Republicanmajorityprovedhighlyuncooperative– In1930,DemocratsgainedcontrolofHouseandalmostofSenate

– InsurgentRepublicanscould—anddid—combinewithDemocratstoharassHoover

– SomeofHoover'stroublesdeliberatelymanufacturedbyCongress

XVIII.RoutingtheBonusArmyinWashington

• VeteransofWWIhard-hitbydepression:• IfHawley-SmootTariffa“bonus”toindustry,• Veteranswantedearlypaymentof1924“bonus”scheduledtobepaidin1945• ManyveteranspreparedtogotoWashington

– Todemandimmediatepaymentofentirebonus– “BonusExpeditionaryForce”(BEF)ofsome20,000wenttocapitalinsummerof1932

– Erectedshacksonvacantlots—agigantic“Hooverville”– AfterCongressvoteddownbonusbill,BEForderedtoleave– 6,000left;Hooverthenorderedarmytoremoverest

XVIII.RoutingtheBonusArmyinWashington(cont.)

– GeneralDouglasMacArthurledefforttooustBonusArmywithbayonetsandteargas• UsedfarmoreforcethanHooverplanned• Brutalepisodebroughtadditionalabuseononce-popularHoover

– TimeripeningforDemocraticParty—andFranklinD.Roosevelt—tocashinonHoover'scalamities

XIX.JapaneseMilitaristsAttackChina

• Depressionincreasedinternationaldifficulties• MilitaristicJapanstoleFarEasternspotlight:

• September,1931:JapaneseimperialistslungedintoManchuria• AmericahadstrongsentimentalstakeinChina,butfewsignificanteconomicinterests• Americansstunnedbyactofnakedaggression

– FlagrantviolationofLeagueofNationscovenantandotherinternationalagreementssolemnlysignedbyTokyo

– NottomentionAmericansenseoffairplay

XIX.JapaneseMilitaristsAttackChina(cont.)

– YetWashingtonrebuffedLeagueattemptstosecureU.S.cooperationineconomicpressureonJapan

–WashingtonandSecretaryofStateHenryL.Stimsondecidedtofireonlypaperbullets• So-calledStimsondoctrine(1932):

– DeclaredUnitedStateswouldnotrecognizeanyterritorialacquisitionsachievedbyforce

– Righteousindignation—orpreach-and-runpolicy—wouldsubstituteforsolidinitiatives

– VerbalslapnotdeterJapan'smilitarists• BombedShanghai(1932)killingmanycivilians

XIX.JapaneseMilitaristsAttachChina(cont.)

– Norealsentimentforarmedinterventionamongdepression-riddenAmericans,whoremainedstronglyisolationistduringthe1930s

– CollectivesecuritydiedandWorldWarIIbornin1931inManchuria

XX.HooverPioneerstheGoodNeighborPolicy

• RelationswAmerica'ssouthernneighbors:– Hooverinterestedinoften-troublednationsbelowRioGrande

– Afterstockmarketcrashof1929:• EconomicimperialismlesspopularathomeinU.S.A.

– Hooveradvocatedinternationalgoodwill• StrovetoabandoninterventionisttwistgivenMonroeDoctrinebyTheodoreRoosevelt

XX.HooverPioneerstheGoodNeighborPolicy(cont.)

– NegotiatedwithHaitiforwithdrawalofU.S.troopsby1934

– In1933,lastU.S.marinesleftNicaraguaafteralmostcontinuousstayofsometwentyyears

– HooverengineeredfoundationstonesofGoodNeighborpolicy• Uponthem,roseimposingedificeundersuccessor,FranklinRoosevelt

The Politics of Boom and Bust,...

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Unit 6 Chapter 10 1920’s. The Roaring 1920’s BOOM and BUST

Boom and Bust

The Politics of Boom and Bust, 1920–1932

1920s-1930s: Boom and Bust! BOOM = Economic expansion

The Politics of Boom and Bust, 1920-1932

Boom or bust

A.P. U.S. History Notes Chapter 32: “The Politics of Boom and Bust” ~ 1920 – 1932 ~

Unit Boom and Bust - kingherrud.com · 2018. 11. 12. · Boom and Bust 1920–1941 Why It Matters In the 1920s, new technology, including automobiles, airplanes, radios, and electric

Chapter 32 APUSH The Politics of Boom and Bust. The 1920 Election

The Politics of Boom and Bust - Georgetown Preparatory Schoolclaver.gprep.org/fac/sjochs/PPT32-ThePoliticsofBoomandBust,1920-1932.pdfThe Politics of Boom and Bust 1920 - 1932. Republican

Bordo Boom Bust Cycles

Chapter 32 The Politics of Boom and Bust, 1920–1932

Why Markets Boom & Bust

Unit Boom and Bust

1920’s & 1930’s: Economic Boom to Bust Economic Boom to Great Depression: The 1920’s & 1930’s

Boom to Bust

Chapter 35 The Politics of Boom and Bust 1920-1932

Unit Boom and Bust · 2/5/2013 · The Great Depression Begins 1929–1932 CHAPTER 12 Roosevelt and the New Deal 1933–1941 Boom and Bust 1920–1941 Why It Matters In the 1920s,

The Politics of Boom and Bust - Fort Cherry School …...The Politics of Boom and Bust 1920 - 1932 Republican Rule in the 1920s •Three Republican presidents –Warren G. Harding,

1920s BOOM 1930s BUST