The Politics of Normalcy Chapter 27

The Warren Harding Error

Two Quotable Quotes: “We want less government in business and more business in government.” “We have had Wilson for eight years, and I have not understood him. I understand Harding already.”

Republican Era Begins “He looks like a President.” – H. Daugherty Committed to the free enterprise system Harding’s fiscal policy Surplus of government dollars and a substantial drop in unemployment

The Ohio Gang Harding filled government positions with his friends which inevitably led to corruption Teapot Dome Scandal:  Leasing of oil reserves to private companies  “If Albert Fall isn’t an honest man…” Harding has a heart attack while “bloviating”

“Silent Cal” “You lose.” “Got to eat somewhere…” “How can you tell?”

Coolidge and Business Stood for integrity, hard work, and thriftiness “The man who builds a factory builds a temple, and the man who works there worships there.” Economized in little and big ways – cut taxes – but in the end… “I do not choose to run for President in 1928.”

“End Poverty As We Know It” Herbert Hoover “associationalism”  Bringing industry leaders together to improve efficiency  As business flourished poverty would disappear Nomination speech of irony

Era of Isolationism The League of Nations / World Court  From complete distrust, to application, to denial Washington Naval Conference  Harding’s great international accomplishment  The superpowers scaled back their warships However, there were loopholes Kellogg-Briand Pact  Outlawed war, but not defensive war  Steps toward World Peace?

Era of Isolationism Great Britain and France owed the US 11 billion dollars  Reliant upon Germany to make payments so they could in turn pay the US Germany stopped making payments Dawes Plan – what did it fix? Latin America – a time of rebellion, and possible US intervention, which the US did not tend to

Republican Boom Years Big business expanded, productivity increased dramatically, unemployment dropped and wages doubled! A new car rolled off the Ford plant every 10 seconds – at cheap prices  What were the secondary benefits of this increased productivity?

New Industries Commercial airplane travel – from a novelty to an efficient vehicle Synthetics and plastics were developed  Revolutionized the clothing and entertainment industry  Radios were in every home as the main source of entertainment The world became substantially smaller

Big Businesses Get Bigger Consolidation:  Ford, GM, Chrysler – and variety! Holding Companies:  A&P: The first Walmart!  Why did it take so long for grocery stores to evolve? Speculators – Ponzi schemes and land booms DJIA saw a massive increase in money invested – people were buying on hot tips and margin!

The Effects of Fast Growth The GNP rose by 40% during the 1920’s, but not all Americans were sharing prosperity Farmers and unskilled laborers were hit particularly hard  Industries were finding easier alternatives which required a smaller labor force