2. From Normalcy to the New Deal American Politics and Life, 1921-1933

3. Harding, Coolidge, Hoover

4. Warren Gamaliel Harding (1921- 1923) “Not nostrums, but normalcy” Cabinet leaders like C. E. Hughes (State), A. W. Mellon (Treasury) and Herbert Hoover (Commerce) among the best ever Cabinet Cronies like A. W. Fall (Interior) among the worst Ohio Gang—whiskey, poker, and women of questionable virtue

5. Major Policy Thrusts Taft appointed to Supreme Court—conservative opinions—Adkins v. Children’s Hospital (1923) Andrew Mellon—lower taxes and lower government spending—tax cuts for wealthy but also maintained balanced budget High Tariffs made post-war European Recovery difficult Capture theory—progressive regulation gutted by conservative appointees to regulatory agencies

6. Scandal Teapot Dome Scandal Harding died before scandal led to public disgrace

7. Calvin Coolidge (1923-1929) “Silent Cal”—a steward, not a leader Pro-business—followed Mellon’s lead on the Economy Huge election in 1924—Democrats too disorganized and Progressives considered too radical by mainstream America

8. Origins of the Great Depression Rise of consumer culture—buying on credit Automobile craze—8 million cars in 1920— 23 million in 1930 Ford Model T is metaphor for new economy, marketing, and mode of production Buying Stock on Margin What happens if scores of people struggle to service their personal debt loads?

9. Model T

10. Origins of the Great Depression Farm prices in slump from 1922 onward McNary-Haugen Tariff Bill vetoed twice by Coolidge Hoover’s voluntary cooperation plans in industry don’t lead to economic boom Open Shop and “Yellow-Dog” contracts hamper labor’s ability to organize collectively Owner’s respond with Welfare Capitalism

11. Gastonia Strike--1929 Stretch Outs, wage cuts, and mill closures in N. C. textile industry Walkout supported by Communist National Textile workers Union Lack of $s, oppression by the National Guard, and demands of racial equality by Union killed off strike How can poor workers continue to consume enough to keep economy going?

12. Herbert Hoover (1929-1932) 1928 Election versus Al Smith Engineer, Humanitarian, and Progressive Agricultural Marketing Act--$500 million to market commodities Hawley-Smoot Tariff (1930) Bull Market Collapsed on Oct. 29, 1929 Market fell from 452 to 52 between 1929 and 1932

13. Onset of Great Depression Market collapse pointed to structural flaws and corruption Factory Orders were cancelled, leading to unemployment 13 million unemployed by 1933—25% of work force Hoover tried to respond—demanded easier credit from Federal Reserve, but it wasn’t enough Hoover signed bill creating Reconstruction Finance Corporation in 1932

14. Hoover’s Image Problem Bonus Army suppressed Hoovervilles

15. 1932 Election FDR win’s Democratic Nomination— promises “New Deal” for the American People—just what was this New Deal? “Interregnum of Despair”—80% of nation’s banks were closed FDR evoked war powers image to grapple with New Deal

16. Run on a Bank

17. FDR—(1882-1945)