The Republicans in Power
Chapter 13 Section 2
Objectives
•How did Republican policies encourage economic growth?
•How did the Harding administration’s pro-business policies affect the
US economy?
•Why did the movement to pass the ERA fail?
•How did the Republican Party overcome the political scandals of the
Harding administration?
•What issues affected the outcome of the 1928 election?
Republican Confidence in 1920
*The Republican party felt they were going to win the 1920 election
because:
• The democrats were still hung up on the League of Nations
• Strikes and unrest put a bad light on the democratic party
Warren G. Harding wasn’t considered overly bright but he had broad
appeal, was friendly and looked presidential
Harding ran under a pro-business platform and promised a return to
“normalcy” . He said we need healing and restoration not heroics
and revolution
*He won in a landslide*
Harding’s Pro-Business Administration
“Less government in business and more business in
government”
• His cabinet included business people like Andrew Mellon as
Secretary of the Treasury and Herbert Hoover as Secretary of
Commerce
His Two Economic Goals
1. Reduce the national debt
2. To promote economic growth
Harding’s Economic Decisions
1. Charles Dawes as head of the Bureau of the Budget slashed
government spending and created a surplus
2. Fordney-McCumber Tariff Act- pushed tariffs on
manufactured goods to their all-time highs. High prices and
profits
3. Eliminated high taxes on the wealthy. Mellon felt that the
wealth of the rich would trickle down to the lower classes.
Result
By 1923 the situation seemed rosy- unemployment was low and
most economic sectors were booming
The Effects of Republican Policies
1. The increased wealth increased mergers
2. By 1930 200 corporations controlled half the nations
corporate wealth
3. From 1923 to 1929 corporate profits increased by 60% and
workers income increased by 10%
4. Some industries like textiles faced pay cuts and
unemployment
5. Farmers had it real rough- shrinking markets, debt, low
prices and high interest rates
6. Unions lost out in the courts and in government. Yellow-dog
contracts and the American Plan sought union free shops
New Directions for Women
• Women had just won the right to vote with the 19th
Amendment but it didn’t seem to change women’s
status very much
• Working conditions were a divisive issue among
women’s rights activists- Feminists
• The Equal Rights Amendment (ERA) was not
universally supported. Some women, like Mary
Anderson- head of the Women’s Bureau, felt that if
they were granted the same rights as men they
might lose their progressive era rights like working
hours and working conditions.
The Harding Scandals
The “Ohio Gang”- Harding’s friends enriched themselves
because of their connection to the president.
1. Charles Forbes, director of the Veteran’s Bureau, made
millions through corrupt schemes
2. Attorney General Harry Daugherty was taking bribes
3. The Big One- The Teapot Dome scandal- Secretary of the
Interior Albert Fall had naval oil reserves in the Teapot Dome
reserves in Wyoming shifted to his control and Fall then
granted private leases to the oil in exchange for cash, cattle
and loans.
*Harding wasn’t guilty on any of this and he “escaped”
humiliation by having a fatal heart attack before most of it
became public
Coolidge Takes Charge
Vice president Calvin “Silent Cal” Coolidge was a quiet
reserved guy who immediately fired anybody
involved in scandals to restore the reputation of the
presidency
Coolidge was even more pro-business than Harding and
the booming economy got him elected in 1924 by a
comfortable margin.
Not everybody was happy because the prosperity was
not enjoyed by all
Coolidge’s Pro-Business Position
Coolidge said, “The business of America is business.”
Pro-business legislation like the Revenue Act of 1926 was designed to
help the rich and the country:
• Repealed the gift tax
• Cut estate taxes in half
• Reduced taxes on the wealthy
Coolidge also cut spending to reduce the national deficit by vetoing
spending bills like:
• A bonus bill to provide aid to WW1 veterans
• McNary-Haugen Bill which would have bought farmer’s surpluses
Coolidge chose not to run for re-election- being President was too
“burdensome”
The Election of 1928
Republican Herbert Hoover ran against
Democratic NY Governor Alfred E. Smith
Smith had a lot of urban immigrant support but he
had a few factors against him like:
• Being Catholic- might listen to the Pope
• Opposition to prohibition
• Ties to Tammany Hall
• His accent which many Americans thought was un
American
The strong economy helped Hoover win the election
with 58% of the vote