Mr. Porter APUSH POWERPOINT CHAPTER 32 Politics of Boom and Bust International and Domestic

KEYS TO THE CHAPTER Three Republican Presidents (HCH) Isolationism Japanese Expansionist Policies High Tariffs International Debt Over Production on the Farms Black Tuesday (10/29/1929) Labor Movement Gains Strength

President Harding Pro-Business but plagued by scandals Courts become business oriented Adkins v. Children’s Hospital (1923) Reversed Muller v. Oregon (1908) that said that women deserved special treatment Held that women had vote, and therefore no longer needed special legislation Struck down minimum-wage law for women

Consolidation in business Agreements made to reduce competition Secretary of Commerce Hoover encouraged cooperation / cut throat competition wasteful Esch-Cummins Transportation Act of 1920 Encouraged private consolidation of railroads 1924 – Bonus Baby’s Money that veterans would have gotten had they stayed in factory jobs (instead of fighting) to be paid as “bonus” in 20 years

1921/1922 – D.C. Naval Conference All major powers but Russia invited Ration of 5:5:3 (US, Britain, Japan) on naval battleships and aircraft carriers British and Americans promised to not fortify possessions in Pacific, including Philippines Japanese not subject to these restrictions Four-Power Treaty US, Britain, France, Japan promised to not seek increased holdings or naval strength in Pacific Open Door policy in China now international law

Kellogg-Briand Pact (Pact of Paris) Coolidge’s secretary of state (Kellogg) signed pact with France to “renounce war” Pledge by nations to forsake war (62 sign) Weaknesses of the Kellogg-Briand Pact Defensive wars permitted Nations could make up excuse of self-defense No enforcement provisions Lulled Americans into false sense of security

Effects of the high tariff policies: Europeans needed to sell manufactured goods in US to Achieve economic recovery Pay down war debt to US Purchase manufactured goods from US High Tariffs slowed international trade & caused Europe to retaliate & increase theirs Business in America suffer in future because can’t sell goods competitively overseas Cost of goods to consumers would rise

Increased distrust of government and courts Teapot Dome Scandal 1921 – Albert B. Fall (secy of interior) got Secy of the Navy Denby to transfer naval oil reserves at Teapot Dome, Wyoming and Calif. to control of Interior Department Fall leased these lands to oil developers Sinclair and Doheny and received bribes from both Case dragged on until 1929 Fall got year in jail; Sinclair & Doheny acquited Increased distrust of government and courts

Teapot dome investigation (An overwhelming, advancing force that many believe would crush everything in its path. In the long run it didn’t)

Harding’s attempt to escape the scandals 1923 – cross-country speaking tour to Alaska August 2, 1923 died of pneumonia and thrombosis (blood clot in a blood vessel) Harding’s legacy Worst news of corruption came out after death Too weak to be a good president “Silent Cal” Coolidge takes over and his philosophy says gov’t should support business, not right social wrongs

“Silent Cal” ----------- Favors Business and wants to reduce government

Problems for farmers in 1920s: overproduction and declining prices High prices drastically declined & productivity up (over supply reduces prices forcing more production) Congress tries to help but President uses veto power Brings increase in progressive movement by farmers again

A Three-Way Race for President 1924 Results Coolidge won with 54% of the popular vote La Follette (progressive) only won Wisconsin, but polled well in Midwest & mountain states Davis (Democrat) got South and cities with large immigrant populations

Coolidge continues isolationism policies except in Latin America where we still keep troops: Dominican Republic until 1924 Haiti, 1914 – 1934 Nicaragua, off-and-on 1909, 1926 – 1933 Mexican nationalization of oil reserves US businessmen want armed intervention but Coolidge relies on diplomacy International debt brings the most issues

International debt problem $10B loaned by US to Allies during WWI US wants to be paid back Allies thought US should write it off They had suffered the casualties Their $ had financed boom in US economy US’s tariffs made it impossible to sell goods US insistence on repayment led to cycle of financial problems in Europe France & Britain demand reparations from G. of $32 billion Berlin inflated its currency to repay debts

German Inflation- Might as well burn it

Effects of the financial meltdown (in 1929) The Dawes Plan of 1924 further complicated the international financial system US bankers loaned $ to Germany Germany paid reparations to France and Britain Allies paid war debts to US System would break down if US credit ended This occurred with 1929 crash Effects of the financial meltdown (in 1929) European nations defaulted on their debts US never got its money Bitter feelings against US in Europe A cause of isolationism in the US in the 1930s

Results of 1928 Election {Hoover vs. Smith} “Hoover wins some democrats” Southerner Democrats broke from Smith because of his Catholicism, “wettism”, foreignism, liberalism Hoover wins a landslide with 58% of the vote Not a typical politician Never before elected to public office Not used to criticism, compromise and asking for votes Real power was in humanitarianism, organization, and honesty

Reversed worldwide trend for more reasonable tariffs Hoover’s first moves are to try and help farmers and to seek increase in tariff Effects of the Hawley-Smoot Tariff (60%) Reversed worldwide trend for more reasonable tariffs Huge trade gaps between US and foreigners Plunged US and world deeper into (already begun) depression Forced US to retreat further into isolationism

Effects of the Crash October 1929 - Great Crash ends roaring 1920s Foreign and domestic investors began a sell-off October 29, 1929 – “Black Tuesday” Scramble to sell of over 16 million shares December 1929 - $40 billion in paper wealth erased Effects of the Crash Unemployed workers 1930 – 4 million 1932 – 12 million Wages slashed 5,000 banks failed erasing savings Homes and farms foreclosed on

Panicked Stock Traders outside the NYSE

A BANK RUN AFTER THE CRASH

Unemployment Line in the Depression

Causes of the Great Depression ----------- Sound familiar to issues today?

Consumer Borrowing in the 1920s ----------------- It will rise even higher in the late 1990s and 2000s -------------- In 2007 America has a negative savings rate

Note skater is so happy he is not looking ahead

Weak farm economy Government policies 1/2 of all Americans still lived in rural areas Farmers never shared in prosperity of 1920s Suffered from overproduction, high debt, and low prices since end of World War I Further hit with severe droughts during 1930s Government policies Lack of regulation over business High tariffs hurt international trade Low taxes put tax burden on middle class

Hoover does not believe in all out government aid: individuals should help themselves – Makes a compromise policy: assist those at the top of the economic pyramid (such as banks and railroads) Relief would trickle down to poor (same policy as R. Reagan) Spending on relief revolutionary for the time, turned away from decades of laissez-faire beliefs sets up idea for New Deal under FDR

Popular feeling in 1932 election Blame it on Hoover

Hoover Dam begins 1930 & finished 1936 Hoover finally recommends Congress appropriate massive sums for public works Total of $2.25 billion spent Hoover Dam begins 1930 & finished 1936 Created lake for irrigation, flood control, electric power 1932: Reconstruction Finance Corporation (RFC) $1/2 billion government lending bank loans to business but not to individuals

Forbade federal courts from issuing injunctions to prevent strikes 1932 – Norris-La Guardia Act greatest law ever passed for labor Outlawed “yellow-dog” contracts (agreement not to join a union as a condition of employment) Forbade federal courts from issuing injunctions to prevent strikes

Bonus Expeditionary Force (BEF) W W I soldiers want bonus now - Voted in 1924; payable in 1945 Bonus Expeditionary Force (BEF) 20K marched on Washington to demand entire bonus and set up public camps Bonus bill fails in Congress Several thousand refused to leave Riots kill 2 people Hoover orders General Douglas MacArthur to disperse the Bonus Army & he overdoes it

Police and Bonus Army Clash 1932

Invasion violates league of nations and shocks America

Japan as Breaker of Treaties After Manchuria

Japanese portrayed as the aggressor nation

US takes paper action against Japan: Secretary of State Henry L. Stimson doctrine: US would not recognize territorial acquisitions gained by force Japan is not deterred 1932 – Japan bombs Shanghai, killing many US remains isolationist – refusal during depression to intervene in China Some say this is when war actually started