The Politics of the
1920s
17-1
The Harding
Administration
• “Return to normalcy”
Teapot Dome and
Other Scandals
• Harding gave cabinets posts and high-level jobs to
friends and political allies (mostly from Ohio)
• Ohio Gang—Harding’s old poker pals
• White House like a speakeasy
• Appointees used to sell gov’t jobs, pardons, and
protection from prosecution
Forbes Scandal
• Colonel Charles R. Forbes (Head of Veterans’ Bureau)
sold scarce medical supplies from vet hospitals
• Costs taxpayers $250 million
• June 1923 Harding died of a heart attack and VP
Calvin Coolidge took office, but he still had to deal
with the Harding scandals during his administration
Teapot Dome
Scandal
• (1922) Albert Fall (Sec of Interior) allowed private
interests to lease lands containing U.S. Navy oil
reserves at Teapot Dome, WY and Elk Hills, Cal. In
return, Fall received bribes from private interests
(+$300,000)
• Other scandals: Att Gen Harry Daugherty took bribes
“Silent Cal” Takes
Over
• Believed prosperity rested on business leadership and
that part of his job as pres was to make sure that the
gov’t interfered w/ business and industry as little as
possible
• “Keep it cool with Coolidge”
• Reelected easily in 1924
Policies of Prosperity
• 1920s—large national debt
• Andrew Mellon (Sec of Treasury) (appointed by
Harding)
• 1.) Balance budget
• 2.) Reduce debt
• 3.) Cut taxes
• High taxes reduced the amount of money the gov’t collected
Supply-Side
Economics
• Low taxes = increase in spending/investing =
economy grows
• Supply-side economics = “trickle-down” econ
• Mellon cut taxes for the wealthy from 73 to 23%
Herbert Hoover
• Herbert Hoover (Sec of Commerce) wanted to balance
gov’t regulation with his philosophy of “cooperative
individualism” –encouraging businesses to form trade
associations that would voluntarily share info with
gov’t
• Reduce economic costs and promote economic efficiency
• Also established Bureau of Aviation and Federal
Radio Commission