Chapter 32: The politics of boom and bust

1. Chapter 32: The politics of boom and bust The American Pageant

2. Election of 1920 • Harding elected • Return to normalcy • "America's present need is not heroics but healing; not nostrums but normalcy; not revolution but restoration...."

3. Harding as President • Ranked as one of the worst presidents due to scandal and ineffectiveness • Cabinet ran presidency • Extramarital affairs and corruption in cabinet

4. Government After War • Good for businesses bad for women • Self-regulation of businesses • Harding appoints 4 conservative supreme court justices • Adkins v. Children’s Hospital • Minimum Wage • 19th amendment – no special treatment for women

5. Esch-Cummins Transportation Act of 1920 • Railroads Private • Merchant Marine Act of 1920 • Sold war fleet at low cost • Adjusted Compensation Act • Compensation for WWI vets

6. America’s End to WWI • Resolution passed in 1921 that formally declared WWI over • 3 years after war ended

7. Foreign Policy Post WWI • Back to isolationism • Exception: drilling rights in Middle East • Washington Conference 1921-1922 • 1st international conference in US • Russia not invited • 5 Power Naval Treaty (US, GB, FR, ITA, JAP) • Reduce naval armaments • Largely ignored • 4 Power Treaty • Status Quo in Pacific (US, GB, FR, and JAP) • 9 Power Treaty • Open Door in China

8. Kellogg-Briand Pact (Pact of Paris) • Outlaw of War • Exempted defensive war • 62 nations signed

9. Economics after WWI • Fordney-McCumber Tariff Law • Raised tariffs from 27%-35% • What was the problem?

10. Farmer Woes • End of war lessened need for goods • Increased supply -> Lowered prices • Volstead Act • Farmers exempt from Anti-trust laws • McNary-Haugen Bill • Gvt purchase and sale of crops • Vetoed 2x by Coolidge (Effect ?)

11. Teapot Dome Scandal (1922) • Oil field reserve in WY • Albert Fall (Sec. of Interior) leased land to in exchange for cash ($404,000) • Exposed by Wall Street Journal • Given back to Navy in 1927 • Fall fined $100,000 and spent 1yr in prison • Lack of trust in big business republicans

13. Coolidge Takes Over • Harding dies of pneumonia and thrombosis in August 1923 • Very quite and bland • Reduce taxes and debts • Economy Prospers

14. Election of 1924 • Republicans nominate Coolidge • “Keep Cool with Coolidge” • Democrats heavily divided and with no strong candidate chose John W. Davis • Robert Lafollette – Progressive Party

16. Whose platforms? • #1 • support for tax reductions and the limitation on government's role in American society; • tariff protection for American industry, as provided in the recently enacted Forney-McCumber Tariff • U.S. participation in international arms reduction program and membership in the World Court.

17. Whose platforms? • #2 • a graduated income tax; • tough enforcement of antitrust laws; • public works projects to alleviate unemployment; • farm relief with more accessible credit and crop price subsidies; • a tariff reduction; • Philippine Island Independence • a referendum on the League of Nations

18. Whose platforms? • #3 • public management and conservation of natural resources • government ownership of the railroads and power-generating resources • acknowledgement of workers' right to unionize and bargain collectively • elimination of child labor • dissolution of monopolies

19. Dealing with the War Debt • America’s desire for $$ from Great Britain and France...led to GB and FRA’s desire for $$ from Germany • Dawes Plan • France and Belgium would leave Ruhr area • Manageable reparation schedule • Relied on U.S Private loans (failed) • Replaced by Young Plan (failed) • Reducing the German obligation from the original $32.3 billion to $713 million

20. Dawes Plan

21. Election of 1928 • Republican – Hoover • Individualism, free enterprise, and small government • Well liked • Democrats – Alfred E. Smith • Catholicism and being anti-prohibition hurt him

23. Hoover’s Farming Policies • Agricultural Marketing Act • Federal Farm Board • $500 million • Low cost loans to farmers • Grain and Cotton Stabilization Corps • Raise prices by buying surplus • failed • Hawley-Smoot Tariff • Raised tariffs 60% • Deepened worldwide depression

24. Inflation • Government programs failed because of inflation • substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency

25. “Black Tuesday” • October 29th, 1929 • Overproduction and Overexpansion

26. Hoover vs. Great Depression

28. Japan and China

30. “The Good Neighbor Policy”