1. The Politics of Boom and Bust
Chapter 32
The Politics of Boom and Bust

2. Election of 1920 Warren Harding “soft” Didn’t like to say no
Staff tied to corruption

3. Industrial Gains
Industrialists wanted government to stop restricting business
Progressive legislation struck down
Antitrust laws ignored
ICC run by men who favored management/business

4. Pro-Business Legislation
1920: railroads returned to private ownership
Lots of wage cuts

5. Veterans
1921: Veterans Bureau- operated hospitals and rehab for sick/injured
1919: American Legion- support/social group for veterans
1924: Adjusted Compensation Act

6. July 21st
Congress “officially” makes peace from WWI

7. Foreign Policy Isolationism
Except: America signed treaty with Britain to share oil reserves in Middle East

8. Foreign Policy Washington “Disarmament” Conference
The Five Power Naval Treaty
The Four Power Treaty

9. Kellogg-Briand Pact, 1928 Ratified by 62 nations Outlawed war
EXCEPT defensive wars

10. Tariff Businessmen didn’t want European products sold in America
Fordney-McCumber Tariff Law: raised from 27 to 35 %
Problem: Europe in debt, needs to sell goods or else they can’t pay back debt to US

11. Scandal- Harding Veterans Scandal: $200 million federal funds stolen
Teapot Dome: Albert Fall accepts a bribe to allow oil companies to drill on federal land

12. Harding
Dies in 1923
Succeeded by “Silent” Calvin Coolidge

13. Coolidge
Shy
Boring speeches
Continued policies

14. Farmers Machinery Crop surpluses Trade with other countries
Government doesn’t help

15. Election of 1924 Democrat party: John W. Davis
Republican: Calvin Coolidge
Progressive: Robert LaFollette

16. Progressive Party Endorsed by Unions and farmers
Government ownership of railroads
Relief for farmers
Opposed monopolies

17. Calvin Coolidge wins

18. Foreign Policy Isolationism Except: Latin American and Caribbean
Loaned money to many struggling countries
Allies couldn't pay back war debt

19. Dawes Plan 1924 America would loan money to Germany
Germany would pay back war reparations
Allies would pay back America
Downturn in economy: US never got money

20. Election of 1928 Herbert Hoover (r): Isolationism Individualism
Free enterprise
Small government

21. Herbert’s First Moves Tried to help farmers (unsuccessful)
Hawley-Smoot Tariff 1930: raised tariff to 60%
Deepens economic depression
Increased financial chaos in the world

22. 5 Causes of the Great Depression
1. Farmer overproduction of crops and o veruse of land
2. Uneven distribution of income
3. Unbalanced foreign trade
4. Overextended personal debts
5. Mechanized industrialization

23. 4 indicators of depression
1. Housing starts were declining
2. Business Inventories were up
3. stock market was overvalued
4. people were buying on credit

25. October 29, 1929 “Black Tuesday”
By end of year, stockholders have lost $40 billion
Businesses/banks shut down
Leads to the Great Depression

26. Dustbowl
Agricultural crisis, 1930s

29. Hoover’s Response Industry and self-dependence
Welfare of people not the government’s responsibility
Image of presidency

30. People’s Response to Hoover
“Hoovervilles”
Hoover flags
Hoover leather
Hoover wagons
Hoover blankets

31. Hoover Plan: Government would help: rrds, banks, creditors
Trickle down economics
$2.25 million dollars for public works
Vetoed “socialist” policies: Muscle Shoals Bill

32. Reconstruction Finance Corporation
Lent money to banks, insurance companies, agricultural organizations, railroads, and state and local governments

33. “Bonus Army” WWI veterans organize Bonus Expeditionary Force (BEF)
March on DC, demand bonuses
Hoover sent in federal troops
Increased public disdain

34. Foreign Policy 1931: Japan invades Manchuria (China)
League of Nations unsuccessful
Stimson Doctrine: US would not recognize any territory acquired by force
Ignored by Japan

35. Latin America Hoover tries to improve relationships
Pulls troops out of Haiti and Nicaragua
“Good Neighbor” Policy