Republican Resurgence and Decline

Woodrow Wilson had been reelected by a coalition of progressives that soon fell apart for a variety of reasons.

· Those who opposed the war were upset with the fact that the U.S. had entered the war, and with its aftermath.

· Organized labor resented the fact that the Wilson Administration was largely unsympathetic.

· Farmers in the South and West felt that they had been discriminated against in the price controls imposed during the war.

· Intellectuals, who had been somewhat progressive, became disillusioned with progressive support for prohibition and fundamentalism, particularly anti-Darwinism.

A great deal of progressive impulse for reform quickly became an impulse for moral righteousness and conformity. It was this impulse that fueled the growth of the Ku Klux Klan and fundamentalist religion. Prohibition also was a prime indicator of the narrow-mindedness of the times.

Normalcy

Wilson’s stroke disabled him considerably, and also marked the end of his political power. Most Americans were tired of idealistic crusades.

The Republicans meeting in Chicago in 1920 nominated Warren Gamaliel Harding, Senator from Ohio, for President.

Harding had been a newspaper editor in Cleveland before being elected to the Senate. He appears to have been the candidate of political machinery. He presumably told a smoke-filled room of his supporters (filled with cigar smoke): "Gentlemen, there is not one reason in the world why I should not be elected President of the United States.

Harding’s campaign called for a return to "normalcy," rather than governmental activism and experimentalism. Harding had few political enemies, and was available. For Vice President, Calvin Coolidge, governor of Massachusetts, was chosen. Coolidge had become popular after his famous cable to the Samuel Gompers after the Boston Police Strike.

The Democrats had a rough time coming up with a candidate. Ultimately, they nominated James Cox, former governor of Ohio, after 44 ballots. For Vice President, they nominated Franklin D. Roosevelt; under-secretary of the Navy (the same position that his cousin Theodore had held.)

Cox traveled the country making speeches, while Harding adopted McKinley’s "front porch" campaign. The party even had a front porch constructed on his home to resemble McKinley’s front porch.

The Democrats were pretty much doomed by the fact that people were tired of Wilson type idealism. They were, in the words of William Allen White, "tired of being noble." Normalcy sounded like a winner to them. The Republicans attacked Wilson and his programs, and ignored Cox. In the end, Cox carried no state outside the solid south, and there he only carried Tennessee. Harding won an overwhelming victory.

Warren Harding was considered a strikingly handsome man by that day’s standards. He wasn’t the straightest arrow in the quiver; he had an affair with a secretary in the White House office; apparently using a closet in the Oval Office as a private place to do the bump and grind. He loved to play poker, and often served whiskey at his poker games, even though this was during the height of prohibition.

Early Appointments and Policy: Harding had much in common with U.S. Grant – he had some of the best minds in the party; but also some of the worst cronies, who quickly came searching for favors. Among the members of his cabinet were Charles Evans Hughes as Secretary of State; Herbert Hoover, Secretary of Commerce, Andrew W. Mellon as Sec. of Treasury; and Henry C. Wallace in Agriculture.

Harding was over his head as President; he once commented that he didn’t think he was big enough for the job. He loved to get away from the pressures of the White House and meet his old friends, known as the "Ohio Gang" for poker, mixed with whiskey and women. Alice Roosevelt Longworth, who was Theodore Roosevelt’s oldest daughter witnessed one of Harding’s poker parties and said "Harding wasn’t a bad man; he was just a slob."

Harding began dismantling many of the social and economic programs of the progressive era. He appointed William Howard Taft, the former President, as Chief Justice of the Supreme Court. The Taft court struck down a federal child labor law, issued numerous injunctions against labor unions on strike, and limited the power of federal regulatory agencies.

Harding also adopted a pro-business tone, similar to that of McKinley. In order to stimulate economic growth, Andrew Mellon, as Treasury Secretary, began a program of reduced government spending and lower taxes.

Mellon insisted that tax reductions should go mainly to the rich; as he believed that wealth in the hands of the few would promote the general welfare.

In this regard, he was very Hamiltonian; as Hamilton had the same beliefs. Many of his admirers said he was the greatest Secretary of the Treasury since Hamilton.

Under Mellon’s leadership, the maximum tax was reduced, governmental spending was also cut, and the budget was balanced.

Mellon also favored high tariffs and innovations in industry. To that end he promoted the Fordney-McCumber Tariff which increased rates on chemical and metal products. This created a problem, however. The U.S. had become a creditor nation during the war; and Mellon insisted that the European powers must repay all the money they had borrowed. The tariff made it difficult for other nations to sell in the U.S., and thus hard to acquire dollars to repay the debts owed.

Under Harding, the government also demonstrated a more lenient attitude towards government oversight of corporations. Harding named conservatives to government agencies. Said Henry Cabot Lodge, "we have torn up Wilsonism by the roots."

A Corrupt Administration: Although conservatives such as Lodge and Mellon were honest, many members of the "Ohio gang," Harding’s old political cronies, were not. They used their White House connections to line their own pockets.

· 1923 – Harding learned that at the Veterans Bureau, one official was constantly looting medical supplies.

· A crony in the Justice department who had no official position sold influence for a fee. When it appeared that this was about to become known, Harding’s general counsel committed suicide in Hardings’ old house in Washington. The influence peddler shot himself also. The Attorney General was implicated in the fraudulent handling of German assets seized during the war, but when subpoenaed to appear before Congress, he took the 5th. He was never indicted, because there was insufficient evidence; largely because he himself destroyed the evidence.

Shades of the Clintons!! A Clinton counsel also committed suicide; and a number of billing records from her old law firm disappeared, and then suddenly reappeared in a White House closet. A number of documents which would have hanged them also mysteriously disappeared.

· The major scandal was the Teapot Dome Scandal. An oil deposit in Wyoming’s Teapot Dome had been set aside as a naval oil reserve. The Interior Secretary, Albert B. Fall, signed contracts allowing private interests to draw on the oil. Fall argued that it was all perfectly legal; yet he had acted secretly, and his standard of living suddenly went way up. He managed to borrow $400,000 from the very oilmen wanting access to Teapot Dome. The public was outraged, and Fall ultimately went to jail.

Harding avoided humiliation in the whole debacle, but was visibly troubled by it. He told William Allen White, the Newspaper Editor, "I have no trouble with my enemies; I can take care of my enemies all right; but my damn friends, my G.D. friends, White, they’re the ones that keep me walking the floor nights.

In 1923, Harding left on a Western speaking tour, and had planned a cruise to Alaska. In Seattle, he suffered food poisoning, and returned to San Francisco, where he suddenly died of either a heart attack or a blood clot in his brain. (Coronary or cerebral thrombosis.)

Millions poured out to express their grief at Harding’s death. The grief didn’t last long, as the corruption of his administration surfaced. It was revealed that he had had an affair with a young lady named Nan Britton, and had had a child by her. Love letters that he had written to another man’s wife also surfaced. His administration became known as one of the most corrupt in history; often compared to that of Ulysses S. Grant. Grant and Harding are the only two men generally considered by historians to be failures as President.

More recent historians have been more kind to Harding, and have noted that he did lead the country out of the turmoil of the postwar years; and was a hardworking president. But even his most scholarly defenders admit that he lacked good judgment, and probably should never have been President.

The Coolidge Administration: Coolidge was on vacation visiting his father when he learned of Harding’s death. His father administered the oath of office to him in the early morning hours of August 4, 1923. Coolidge was entirely different from Harding, as was his wife, in that they were the very image of grass roots integrity and honesty.

Two stories about Coolidge:

· Once at a formal White House Dinner; coffee was served after dinner. Coolidge quietly poured coffee into his saucer to cool. When he did so, all the other guests did likewise. He then put cream and sugar in the saucer, and stirred it up; all the guests did the same. Coolidge then placed his saucer on the floor—he had been mixing it up for his pet cat.

· Once during a heavy snowstorm, the roof of the White House gave way in a small area. Repairmen were working on it, and Coolidge himself actually climbed the ladder to help. The chief White House housekeeper came on them, did not see Coolidge, and commenced to raise Cain about the mess. She gasped when she saw Coolidge suddenly, but it was too late. Said he, "perhaps you would be more comfortable in Buckingham Palace, Mrs. Graham." Her reply was, "you’ll have my resignation in the morning."

Coolidge was remarkably quiet and unassuming, which endeared him to many Americans. He was often seen fishing, pitching hay, wearing an Indian bonnet along with his business suit, and was so quiet by nature that it became something of a joke.

Once, a diner guest bet Coolidge he could make him say three words. Coolidge looked at him and replied, "You lose."

Coolidge firmly believed that Congress should take the lead, and the President should follow. He once said that "four fifths of our troubles would disappear if we would sit down and keep still." He took his own advice. He insisted on sleeping twelve hours every night, and took a nap in the afternoons. This led H. L. Mencken to comment that Coolidge "slept more than any other president, by day or by night. Nero fiddled, but Coolidge only snored. He was the ultimate conservative, and supporter of big business. His famous statement was, "the business of America is business; the man who builds a factory builds a temple. The man who works there, worships there."

Coolidge focused on industrial development at the expense of labor and agriculture. He tried to end government regulation of business.

In the 1924 election, Coolidge had only token opposition for re-nomination. The Democrats were hopeless divided, so much so that Will Rogers said, "I am the member of no organized political party; I am a Democrat." It took them 103 ballots to nominate a Wall Street Lawyer, John W. Davis. Robert Lafollette also emerged as the candidate for a newly organized Progressive Party. The result was a landslide for Coolidge. His campaign slogan was "keep cool with Coolidge."

The New Era: Coolidge’s reelection was interpreted by Coolidge and Republicans as a vindication of their policies. A new philosophy soon engulfed the country: Old time values of thrift and saving gave way to the idea that spending was a virtue. This was aided by the innovation of installment purchases. One newspaper editor said that consumption was the new necessity in America.

A large part of the boom of 1922 – 1929 was the result of consumer spending. Moderately priced items such as hand cameras, wristwatches, cigarette lighters, vacuum cleaners, washing machines, linoleum floors became more and more available.

The Moving picture industry also boomed. The first truly modern Motion Picture was D.W. Griffith’s Birth of a Nation. It grossed $18 million and showed the potential of the movie industry.

*** More important is the fact that the movie perpetuated a distorted view of the Old South. It featured stereotypes of villainous carpetbaggers; sinister mulattoes; blameless white southerners, and "faithful darkies." It begins with blacks in slavery happy and content, and in the end, when free, they seem lost and discontented. One is reminded of the words of the Hebrews to Moses: "Better were we when we were slaves in Egypt." Griffith seems to be promoting this same idea in the movie.

Movies soon replaced oratory as the chief form of entertainment of Americans. The first talking move, was in 1926, with Al Jolson in dark-face playing in The Jazz Singer.

The radio industry also took off. The first commercial aired in New York in 1922. By the end of that year, there were 508 stations with 3 million receivers in use. In 1926, NBC, a subsidiary of RCA began linking nations into a network, the Columbia Broadcasting System.

Radios at the time were large models that sat on the floor, larger than an old television set. The family gathered around the radio and listened to programs, just as one watches a TV program now. Favorites were The Lone Ranger, Gunsmoke, and Young Widder Brown. Sound effects were very effective; people often sat spellbound by the radio most of the evenings. There was no television.

Airplanes, Automobiles, and the Economy: As of the outbreak of World War One, the U.S. had no combat planes; American pilots flew in British and French aircraft. There was just no impetus for the industry to develop. It finally began to move under the Air Commerce Act of 1926, which provided federal aid to air transport and navigation.

A big boost came in 1927 when Charles A. Lindbergh, Jr. flew from New York to Paris in 33 hours, 30 minutes. He won a prize of $25,000 and became the first person to fly non-stop across the Atlantic. By 1920, there were 43 airlines operating. Air transport was greatly enhanced by the development of the Douglas DC-3 which became the chief passenger plane of America.

The most significant development of the era was the automobile. This was largely the work of Henry Ford, who decided that everyone should own an automobile. By 1920, more than 8 million automobiles were registered. Automobile production created a tremendous market for steel, rubber, glass, and textiles. It also gave rise to a huge oil market and the development of good roads.

The automobile industry became a prime example of mass production. Henry Ford was largely responsible for assembly line production. He had chain conveyors installed that pulled parts along until the final automobile was assembled.

Ford’s famous statement about his automobiles was, "You can have it in any color you want, as long as it’s black." He only made the Model T in Black.

Stabilizing the Economy: Herbert Hoover, an engineer and Secretary of Commerce, wrote a book, American Individualism. (1922). The idea was to promote the virtue of the work ethic.

Hoover as Commerce Secretary made the Commerce department important. He sought out new markets for business, and sponsored conferences on design, production, and distribution, and moved the economy towards standardization of everything from tires to toilet paper. He reduced the kinds of nuts, bolts and screws needed in construction.

Hoover told Sherwood Anderson, the author, "It doesn’t matter to me that there are a million automobiles on the road like mine. I am going somewhere and I want to get there in what comfort I can and at the lowest cost.

Agriculture was still a weak sector; in fact in the 1920’s it was the weakest sector of the economy.

· Prices had collapsed at the end of World War I because of overproduction and reduced demand.

· Many farms went into foreclosure; many farms in the cotton belt went into bankruptcy.

As a result, farms grew larger and more mechanized. There was increased use of heavy equipment, which made farming more efficient. Also, farm organizations moved away from alliances with urban labor, which had been typical of the Populist times, and moved towards the idea that farmers were businessmen. This was the beginning of Professional Farming.

· Marketing coops were formed, which allowed for contracts with producers over a period of years. The producer would contract an entire crop for a period of years.

· Standard grading of produce which made marketing more efficient.

· Advertising through cooperative associations.

The American Farm Bureau Association was formed in 11920 at a meeting in Chicago to protect the interests of large commercial farms. It was said to be a "marriage of corn and cotton.

Farm legislation at the time was designed to protect farmers:

· McNary-Haugen Bill: Allowed excess farm produce to be dumped on the world market. This would raise prices at home. The goal of the farm bills was parity: that is, that prices would have the same purchasing power relative to the prices of an earlier time, in this instance, 1909-1914.

Coolidge vetoed the McNary-Haugen Bill, as being "Unconstitutional and Unamerican." However, the bill forced debate on farm surplus, and made parity a goal of the farm movement.

Union membership suffered while Coolidge was President. This was largely due to the Red Scare (Americans were prone to associate unions with communists): and the fact that employers promoted "open shop" hiring; a situation in which union membership is not a requirement for one to work.

In a "closed shop," one must hold a union card to work at a factory; if he loses his union card, he isn’t allowed to work.

As a result of all of this, union membership declined drastically.

Election of 1928: August 2, 1927, Coolidge was on vacation in the Black Hills of South Dakota when he handed out slips of paper to reporters with the statement: "I do not choose to run for President in 1928.

There has been a lot of debate by what Coolidge meant. Most historians feel he at least hoped that the convention would draft him to run anyway. However, his statement cleared the way for Herbert Hoover to run.

Hoover mounted an active campaign, and had too much momentum to be stopped by the time of the Republican Convention. Hoover was a Quaker, a son of Middle America, a successful engineer and businessman. He called Prohibition "a great social and economic experiment.

The Democratic nomination went to Alfred E. Smith, a General Motors executive, who had until recently been a Republican. He was the son of Irish immigrants, Catholic, and anti-Prohibition. He was not trusted by small town and rural Americans; and could not hope for support outside the big cities.

Hoover won by a landslide. His election was a vindication of Republican economic policy which had brought prosperity to the Country. There were, however, indications that people in the big cities and in the farms were shifting to the Democratic Party; a fateful shift for Republicans.

Everything looked rosy in 1929 when Hoover took office. Business was booming, incomes were rising, and Hoover, who as Commerce Secretary had engineered this prosperity was about to become President. At his inauguration, Hoover told the audience, "I have no fears for the future of our country; it is bright with hope."

Aside from the fact that he was a hardnosed businessman, Hoover the Quaker was very progressive and humanitarian.

· He announced plans for tax reductions for low-income Americans.

· He stopped patronage practices, and stopped "red hunts."

· His wife was the first to entertain a black man at the White House since 1901, Oscar DePriest, and Hoover supported her decision.

· Proposed that membership on Federal Parole board reflect the number of black Americans in prison.

Hoover offered two remedies for low agriculture prices:

· Federal help for cooperative marketing.

· Higher tariffs on farm products.

1929, he pushed through Congress the Agricultural Marketing Act which set up a Federal Farm Board to help farm cooperatives market major commodities. It also set up programs whereby the government could buy up farm surpluses.

Sadly, the plan got underway at the same time as the Great Depression, so it had little chance for success.

Tariffs didn’t help either. Hoover pushed through the Hawley-Smoot Tariff of 1930 which raised prices on farm products to an all time high. Economists argued against it, and urged Hoover to veto the tariff, because they said it would increase prices to consumers, hurt the export trade, and thereby hurt farmers. However, 1930 was a mid-term election year, and Hoover felt that he had to go along with his party.

The Economy Out of Control: People believed the economy had entered a period of permanent growth; and the result was a growing tendency towards "get-rich-quick" schemes. People speculated in Florida Real estate, particularly since the automobile had made Florida accessible.

Miami was a hotbed of real estate speculation. A group called the "binder boys" had it down to an art. The idea was, one paid a small "binder" fee for an option to buy real estate later; then sell the binder to someone else for a profit. The binder might pass through a dozen hands before title to the real estate passed. This was a bubble, of course, and by 1926, when there were no "bigger fools" left to pass the buck to, the bubble burst.

This was nothing compared to the Great Bull Market of 1927.

Bull Market: Stocks have sustained increase in value.

Bear Market: Stocks have a sustained decrease in value.

Up until 1927, stock prices had gone up with industry profits; but thereafter, they increased solely on the basis of speculation. Increased demand for stocks, on the hope that they would increase in value, brought more and more people into the stock market. Also, the tax reductions of Andrew Mellon had put money in the hands of wealthy people who started buying stock on margin.

Buying stock on margin means one makes a small down payment and the broker covers the balance, holding the stock as security for the purchase. The idea was to repay the loan when the stock is sold…if it goes up in value. If it declines, the broker would keep the stock, sell it to cover the loan, and look to the customer to cover the difference.

Between 1927 and 1929, broker loans doubled.

There were signs in the air that things were about to come to a screeching halt. Residential construction and automobile production were catching up with demand. There were no more people standing in line to buy them. Business inventories began to rise because there were not that many customers; and consumer spending began to slacken off. All these are signs of a slowing economy, but the speculators in the stock market ignored the signs, and continued to buy, buy, buy, and as a result, the market continued to rise.

By 1929, the market had gotten so high it was a fantasy world, everybody knew it was overpriced, but it didn’t stop. Financial experts who argued that things should slow down were ignored. Hoover was worried, and told the Federal Reserve to discourage speculation. As a result, the Fed raised the discount rate, the amount it loaned to member banks, thereby making it more expensive to borrow money, but it had no effect.

Fall of 1929, the market began to fluctuate; it was beginning to show signs of uneasiness. Finally, investors got worried, and were afraid prices could go no further, and started unloading shares. This, of course, drove prices down. The market staggered for a few days until Tuesday, October 29, 1929, (Black Tuesday); the bottom fell out, with sellers dumping stock wildly. The end result was the most disastrous day in Wall Street history. A busy day for the market then was three million shares. On that day, 16.4 million shares were traded.

The headline in the newspapers the next morning said it all: "Wall Street lays an egg." Many people who had borrowed heavily to speculate were totally wiped out in one day. People who had no business in the market were trading in the hundreds of thousands of dollars; and when it collapsed, lost everything. It became so bad that bad jokes went around: One said that if a guy rented a room at the Waldorf Astoria, he was asked if it was for sleeping or jumping. Another said with every 100 shares of stock purchased, one got a complementary revolver.

Banks and investors tried to stop the slide to no avail. By March, 1933, the market was valued at less than 1/5 its value at peak. The Stock average, which had been 452 in September, 1929, reached 52 in July, 1932.

The decline in the stock market and slowdown in the economy caused consumers and business people to hold out for lower prices. As a result, prices fell, but at the same time wages fell, and business dropped drastically. From 1929 – 1932, American’s personal incomes fell by more than half. More than 9,000 banks closed; hundreds of factories and mines shut down, thousands of farms were sold at foreclosure.

Several weaknesses in the economy became apparent:

· Businesses had tried to maintain prices and take profits while holding wages down. The end result was that one third of personal income went to 5 % of the population. Profits were put into expansion rather than wages, businesses created an imbalance between productivity and purchasing power. They never made the connection.

· Governmental policies didn’t help. Mellon’s tax policies encouraged over-saving, which diminished the demand for consumer goods. This extra money in the money supply encouraged speculation.

· The gold standard was another problem. Keeping money tied to gold kept the money supply tight, and made the economy worse. The only way that the economy could stabilize under the gold standard was to allow prices and wages to fall until they reached a point where they were stable. Needless to say, it would wipe out a lot of people on the way down.

The Human Toll: The effect of the collapse of the economy was devastating. By 1933, 13 million people were out of work. Factories shut down, banks closed, farms went bankrupt, people were jobless, homeless, and penniless. People lined up at churches and soup kitchens, just for a bite to eat. Many slept on park benches; thousands of men "rode the rails," as hoboes, traveling from town to town, looking for work. Homeless people wrapped themselves in newspapers to stay warm in the winter, and called them "Hoover blankets." Many could stand it no longer, and as a result the suicide rate soared.

Few public officials comprehended the depth of crisis. Most said that all that was needed was a slight correction of the economy. They expected the market to correct itself.

Even Hoover thought the best policy was to ride things out. Actually, he did more than any other president before him to help people suffering during the depression, but still his own philosophy became hardened, and he set limits to governmental action and was not ready to admit he was wrong, even when disaster appeared likely.

Hoover believed that the fundamental business structure of the country was sound, and all that was needed was confidence. He made numerous speeches, telling people to keep up hope, and asked factory and shop owners to stay open, and spread work to avoid layoffs.

Hoover’s Vice- President had made the comment that "good times are just around the corner." The remark was attributed to Hoover, and became a sick joke.

Hoover hurried the construction of public projects to provide jobs; but state and local cutbacks more than offset federal spending. Hoover also insisted the Fed return to an easy monetary policy; and Congress passed a small tax reduction; plus the Federal Farm Board stepped up loans to farmers. But it didn’t help. A bumper crop in 1930 offset aid to farmers, and the Hawley-Smoot tariff led to reprisals from foreign traders, devastating the foreign market.

The depression hurt the Republicans and the Democrats exploited it for all it was worth. People made fun of Hoover, referring to settlements by homeless people out of work as Hoovervilles. A "Hoover Flag" was an empty pocket turned inside out. In the 1930 midterm election, Democrats won a majority in the House, and a controlling interest in the Senate.

Hoover refused to change his policy. He insisted that the answer was voluntarism. He said that each local community should undertake relief programs "with that sturdiness and independence which built a great Nation."

The economy suffered another blow when a large Austrian bank failed; causing panic in European markets. Hoover proposed a moratorium on war reparation payments, but the result was that no loans were repaid. More importantly, there was little monetary exchange in Europe, so Europeans withdrew their gold from American banks, and dumped American securities. This hurt the U.S. even more. The depression entered its third winter.

With a new Congress, Hoover had to do something. In 1932, the Congress set up the Reconstruction Finance Corporation (RFC) to fund emergency loans to banks, insurance companies, railroads, etc. It did manage to stave off some bankruptcies; but Hoover’s critics said that it favored big business.

Other efforts at recovery:

· Glass-Steagall Act of 1932 changed the definition of commercial loans that could receive support. It also released $750 million in Gold used to back Federal Reserve notes; which enlarged the amount of money in circulation.

· Federal Home Loan Bank Act (1932) created discount banks for home mortgages. (These were the old savings and loans).

Hoover’s critics said this was "trickle down" economics. It didn’t help the poor guy who had been out of work. Hoover could have taken the bill by the horns, and worked for more government relief; but he held back, and moved towards federal relief only grudgingly. He still believed that voluntarism and state action were the key.

On July 21, 1932, Hoover signed the Emergency Relief and Construction Act which gave the RFC $300 million for relief loans to the states; authorized loans of up to $1.5 billion for state and public works, and $322 million for federal public works.

Farmers were soon abandoned. In mid-1931, the government quit buying farm surplus, and farm prices plummeted. Wheat had brought $2.16 per bushel in 1919; by 1932, it had reached 38¢. Cotton, which had been 17¢ per pound in 1929, dropped to 5¢ in 1932. Farm income dropped more than 55% between 1929 – 1932. Over a million farms went into foreclosure between 1930 and 1934.

Farmers and Veterans in Protest: Farmers became desperate and defied the law. Mobs stopped foreclosures and threatened to lynch judges. Farmers burned corn in Nebraska to keep warm, and there was even talk of a revolution. The Communist party was gaining more and more support, particularly when it organized "hunger marches."

The Governor of Mississippi, Theodore Bilbo, told reporters, "Communism is gaining a foothold. . . . In fact, I’m getting a little pink myself."

Communists came close. They organized the Share Croppers Union in Alabama to support the Scottsboro boys; nine black boys accused of raping a white girl on a train on the basis of nothing more than her testimony. Yet very few American were converted to Communism. Less than 100,000 Americans every joined the party.

A bigger problem was the Bonus Expeditionary Force. Congress had voted a bonus for world war veterans in 19224. The movement was to have the bonus paid right away, and a group of veterans marched on Washington for that purpose. Over 15, 000 veterans joined the march. The Senate voted down the bill, and most went home, but some had no place to go, and began camping in vacant government buildings and in a nearby shantytown.

The Washington police chief handled the situation well, but Hoover panicked. He got Congress to pay for their tickets home. Some left, but others stayed, even after Congress adjourned, hoping to at least meet Hoover. Hoover ordered the buildings cleared, and in the process, a policeman panicked and fired into the crowd, killing two veterans.

After this, the President called in troops. Seven hundred soldiers under Gen. Douglas MacArthur, aided by junior officers Dwight D. Eisenhower and George S. Patton, Jr. drove out unarmed veterans, and injured many of them. There was only one fatality; an eleven week old boy born at the shantytown.

MacArthur claimed that it was a mob "animated by the essence of revolution." The Administration insisted that it was mostly Communists and criminals. Neither a grand jury or the Veterans Administration found evidence of either.

Everyone, including Hoover, was totally disillusioned and defeated. The entire country was seized with a sense of doom.