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The Roaring Twenties. The 1920s. OVERVIEW Politics Elections Policies Scandals Economics Economic Performance Labor Farmers Society “Days gone by versus the days ahead”. The 1920 Election. Democrats – James M. Cox/Franklin D. Roosevelt Republicans – Warren G. Harding/Calvin Coolidge
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The 1920s OVERVIEW Politics Elections Policies Scandals Economics Economic Performance Labor Farmers Society “Days gone by versus the days ahead”
The 1920 Election Democrats – James M. Cox/Franklin D. Roosevelt Republicans – Warren G. Harding/Calvin Coolidge Campaigned on the theme: “Return to Normalcy” RESULTS: Harding – 16,143,407 pop. vote (60.4%) (404 electoral votes) Cox – 9,130,328 pop. vote (34.2%) (127 electoral votes) Who was Harding? • Senator from Ohio • Considered a “good second-rater” • Willing to follow the party bosses • Portrayed by the press as a wise and effective leader • Delegated much of his authority and responsibility to others • In way over his head (Quote)
Harding as President POLICIES • Very Pro-Business • Lowered corporate, personal and inheritance taxes by 50% • Raised the tariff to an average rate over 50% • Repealed progressive reforms • Appointed pro-business justices to Supreme Court that struck down child labor laws, minimum wage laws, and upheld business associationalism
Harding as President Appointments • Attorney General – Harry Daugherty • Sec. of Interior – Albert Fall • Sec. of Treasury – Andrew Mellon (3rd richest man in America) • All cronies – members of the “Ohio Gang” Scandals • Ohio Gang appointees sold government offices, accepted bribes and bribed Congressmen for votes • Head of the Veterans Administration sold hospital equipment and pocketed the money • Teapot Dome
The Teapot Dome Scandal Teapot Dome – Naval oil reserves in Wyoming • At Sec Int Fall’s urging, Harding transferred the oil reserves to Interior • Fall leased the oil to the Pan-American Oil Company and the Sinclair Oil Company • Fall received $400,000 in unsecured “loans” Results • Harry Sinclair spent 9 months in jail for contempt of the Senate and jury tampering • Fall served 1 year in jail, fined $100,000. • Oil was returned to the government
Death of Harding June, 1923 – ate Japanese crab and fell ill. His Surgeon General (an Ohio crony) diagnosed it as food poisoning. August 2, 1923 – died of a heart attack. Point 1 – His doctor was incompetent and misdiagnosed the food poisoning. He really had a heart attack the first time. Point 2 – Because of Harding’s death, the scandals never hurt his reputation.
Coolidge as President • Known as “Silent Cal” • Continued Harding’s pro-business policies • Believed the wealthy were the creators of prosperity (today’s “Job Creators”) • Allowed business associationalism – the evolutionary end-stage of monopolies. • Elected in 1924 under the slogan “Keep Cool with Coolidge” • Did not seek re-election in 1928
Election of 1928 Republican Herbert Hoover • Sec. of Commerce • Iowa (mid-west) • Protestant (Quaker) • Self-made millionaire • Farm boy • Rural • Dry • Represented Old Stock America • 21,391,993 (444) Democrat Alfred E. Smith • Governor • New York (north-east) • Catholic • Son of immigrants • Lived in a tenement • Urban • Wet • Represented New, Modern Urban America • 15,016,169 (87)
Hoover as President • Promised “A Chicken for Every Pot” • Stock Market crash Oct. 29, 1929 • Started the Great Depression
ECONOMICS Economic Performance During the 1920s • output rose 60% • GNP up 5%/yr • Per capita income up 33% (for top earners) • Reasons: • Feeding/supplying Europe after WWI • Auto industry and spinoffs • Radio industry • Aviation • Electronics • Appliances • Cheap energy • Layaway purchasing
ECONOMICS Stock Market Crash • Oct. 29, 1929 – “Black Tuesday” • Dow Jones Industrial Average fell from 260.64 to 230.07 • 16.4 million shares sold • Value loss: 37% • By July, 1930, the Dow -198 • By Nov., 1930, the Dow – 41 • $16,000,000,000 lost from Oct-Nov, 1929 • March, 1933: value of market @ 20% • 1929-1932: personal incomes fell from $82m to $40m
Economics Why the Market Crashed • Over speculation • Value of stock was worth more than the actual companies • Buying on margin • Buyer purchases stock with 10% cash and borrows balance from a bank, stock is used as collateral • Margin – difference between cash down payment and total price of stock • When value of stock rises, stock owner sells stock, repays bank loan and still makes a profit. • Profit is used as a down payment for another stock purchase also bought on margin • However, if the value of the stock drops, the buyer must make a cash payment on the loan to balance the value of the loan and the value of the stock. This usually involves selling stock • If everyone sells at the same time, the market crashes.
Economics Labor Unions • Membership down by over 50% • Annual Income $1500 (Standard-$1800) • Unemployment 5-7% • Why? • Welfare Capitalism – businesses supplied benefits to workers to avoid strikes • Company Unions • American Plan – created open (non-union) shops • Red Scare – Marx predicted communism would start with labor unions
Economics Farmers • Average income: $223/yr by 1929 • Only segment of economy that saw a decline • Prices dropped due to overproduction • Why? • # of tractors quadrupled • Foreign markets closed • Ladies’ fashions Consumerism • True consumer society for the 1st time • Commercially processed foods sold at chain stores • Availability of new appliances, automobiles • Why? • Advertising in newspapers and magazines • Lay-a-way purchasing (going into debt)
1920s Society Fads and Fashion • The Charleston • Stunts (pole sitting, planes, etc) • Flappers • Low necklines, high hemlines • Speakeasies
Years gone by vs. Years Ahead Prohibition • Started by the 18th Amendment – outlawed sale, manufacture, transportation and consumption of alcohol • Total consumption decreased, per capita consumption of drinkers increased • Liquid tonsillectomies • Created an aura of lawlessness: gangsters, rum-runners, bootleggers, and the speakeasies • Drys - rural, agricultural , Protestant, South and Midwest: Old Stock America • Wets - urban, industrial, Catholic, Jewish, Northeast, west coast: New America (1st and 2nd generation )
Years gone by vs. Years Ahead Ku Klux Klan • Reborn in 1915 after the release of Birth of a Nation • Founded by William J. Simmons • Focused attention on anyone who was not a WASP: Jews, blacks, Catholics, immigrants, etc • Pro-prohibition, anti-immigrant, hyper-nationalist • 6,000,000 members in 1924 (6,000 today) • Controlled elections in many states
Years gone by vs. Years Ahead The Scopes Trial • July 23, 1925 – trial of John T. Scopes, science teacher in Dayton, TN • Charged with teaching evolution in a public school • Defended by Clarence Darrow • Prosecuted by William J. Bryan • AKA “The Monkey Trial” • Scopes convicted, fined $100. Overturned on appeal. • Trial represented the battle between religion and science (the past vs. the future, old vs. new, rural vs. urban)
