Chapter 31 APUSH

The Politics of Boom and Bust: 1920–1932

Introduction

  • The period from 1920 to 1932 in the United States is marked by significant economic and political fluctuations, culminating in the Great Depression.

  • Herbert Hoover, elected in 1928, expressed optimism for the eradication of poverty, stating that the U.S. was nearer to triumph over poverty than any previous nation.

The Republican Leadership

  • Three Republican presidents drove the nation's economic policy during this era: Warren G. Harding, Calvin Coolidge, and Herbert Hoover.

    • Each contributed to the volatile economic climate that began with post–World War I prosperity and ended with the Great Depression.

  • The Republican approach during this period involved a retreat from progressive reforms, aiming to benefit public good primarily through collaboration with big business rather than direct government action.

    • This resulted in some instances of governmental corruption, where officials exploited public resources for personal gain.

Return of the Republican 'Old Guard'

  • Warren G. Harding (Inaugurated 1921)

    • Seen as a well-liked character, yet his presidential capabilities were limited.

    • Known as a kind-hearted man who struggled with decision-making, finding himself often surrounded by corrupt associates (the "Ohio Gang").

    • Promised to appoint the best minds; key appointments included:

    • Charles Evans Hughes (Secretary of State): Dominated and somewhat conservative leader.

    • Andrew W. Mellon (Secretary of Treasury): A wealthy industrialist who encouraged a focus on big business.

    • Herbert Hoover (Secretary of Commerce): Enhanced the importance of his position by promoting foreign trade and improving business efficiency, contrasting with other cabinet members who were deemed corrupt or ineffective.

Reconstruction of Policies

  • The Harding administration marked a shift back to pre-progressive business practices:

    • Judicial Influence: Appointments impacted the Supreme Court leading to a restrictive approach to labor laws and government's role in the economy.

    • Adkins v. Children’s Hospital (1923): This case overturned previous protective labor laws for women, asserting that women now had equal legal standing due to the Nineteenth Amendment, sparking ongoing debates about gender equality in legal protections.

  • The Harding administration enabled corporations to thrive:

    • Antitrust laws became ineffectively enforced, allowing for monopolistic practices and the establishment of trade associations.

Aftermath of World War I and Economic Policies

  • Quickly dismantled wartime controls over the economy, returning management to private interest despite previous calls for regulation.

  • The Esch-Cummins Transportation Act (1920): Encouraged the consolidation and profitability of railroads, moving away from public ownership proposed during the Progressive Era.

  • Labor movements were suppressed, membership declined dramatically from 1920 to 1930 due to hostile government attitudes and violent breakups of strikes (e.g., steel strikes).

Veteran Assistance

  • The Veterans Bureau (1921) was created to aid veterans, reflecting the government's obligations to those who served during WWI.

  • Motivated political activity among veterans, exemplified by the American Legion's lobbying efforts for monetary compensation.

  • The Adjusted Compensation Act (1924) eventually provided veterans with insurance policies, a significant financial liability for the government.

Isolationist Policies: Foreign Affairs

  • The end of World War I left the U.S. without a treaty, prompting Congress to announce the war’s conclusion alone.

  • The Washington Disarmament Conference (1921-1922) aimed to prevent arms races among major powers but often resulted in ineffective agreements and disarmament proposals.

    • Significant treaties included:

    • Five-Power Naval Treaty (1922): Established ship ratio limits (USA: 5, Britain: 5, Japan: 3) but lacked enforcement mechanisms.

    • Nine-Power Treaty: Affirmed Open Door principles in China, but ineffective in securing actual international commitments.

Domestic Economic Policies and Tariffs

  • Economic protectionism characterized U.S. policies in the 1920s, highlighted by the Fordney-McCumber Tariff (1922) and the later Hawley-Smoot Tariff (1930), which raised tariffs significantly, impeding international trade and compounding the effects of the Depression.

Scandal and Corruption

  • Scandals plagued the Harding administration, particularly with the Teapot Dome scandal, involving corruption among cabinet members:

    • Albert Fall, involved in a bribery scheme, was convicted after the scandal began coming to light, prompting fears about governmental integrity.

  • Overall, the challenging moral fiber of the Harding administration furthered public cynicism regarding government integrity.

The Coolidge Administration

  • Coolidge succeeded Harding and was seen as embodying virtue and frugality, but his policies continued aiding big businesses and reflected indifference towards addressing the economic hardships citizens faced.

  • Coolidge's administration remained isolationist, withdrawn from foreign engagements, maintaining military presence in Central America but adopting more cooperative relations with Latin America (Good Neighbor policy).

Hoover’s Presidency and Economic Collapse

  • Herbert Hoover began his presidency during a time of economic prosperity, yet the Great Crash of 1929 ushered in the Great Depression, whose origins included overproduction, high tariffs, and unregulated speculation.

  • Throughout this period, lacked effective responses to alleviate economic suffering, showcasing a tension between individualism and the need for federal intervention.

  • Relief efforts were mainly indirect, such as loans to businesses rather than direct aid to individuals. Consequently, many critics labeled Hoover’s administration as ineffective, culminating in diminished public support and increased hostility.

Bonus Army Incident

  • The 'Bonus Army,' made up of WWI veterans demanding immediate bonus payments, protested in Washington, D.C., leading to violent clashes with authorities when Hoover ordered their eviction, severely damaging his presidency's image.

International Relations and Conflicts

  • Japanese aggression in Manchuria and global economic turmoil characterized international relations during Hoover's presidency. U.S. responses were marked by non-interventionist strategies despite advocating for support of non-aggression principles.

Conclusion

  • The policies and events from 1920 to 1932 set the stage for widespread social change and ultimately led to significant shifts in government role and foreign policy under Franklin D. Roosevelt following the Great Depression's devastating impact.

Here are defined key terms from the context of U.S. history during the 1920s and early 1930s:

  1. Bonus Army: A group of World War I veterans who protested in Washington, D.C. demanding immediate payment of their service bonuses. The violent eviction of these veterans damaged President Hoover's public image.

  2. Stimson Doctrine: A policy articulated by Secretary of State Henry Stimson in 1932, stating that the U.S. would not recognize territorial changes resulting from the use of force, specifically referencing Japanese aggression in Manchuria.

  3. Disarmament: Efforts made during the 1920s aimed at reducing armaments among major world powers, exemplified by conferences like the Washington Disarmament Conference but resulting in limited effectiveness.

  4. Kellogg-Briand Pact: An international agreement signed in 1928 that attempted to eliminate war by having signatory states declare war illegal, though it lacked enforcement mechanisms and was largely ineffective.

  5. Teapot Dome Scandal: A corruption scandal during the Harding administration involving the secret leasing of naval oil reserves at Teapot Dome, Wyoming, to private companies in exchange for bribes, leading to significant public mistrust.

  6. Dawes Plan: A 1924 plan for resolving World War I reparations that eased the payment schedule for Germany and involved loans from the U.S. to stabilize the German economy.

  7. Hoovervilles: Makeshift shantytowns built by homeless people during the Great Depression, named derogatorily after President Hoover, who was blamed for the economic crisis.

  8. Hoover Dam: A large concrete dam built during the Great Depression on the Colorado River, which provided jobs and helped water management and electricity generation, symbolizing federal efforts to combat the economic downturn.