-Latin America s major role in the global economy was as an exporter of commodities such as wheat, corn, beef, wool, copper, coffee, and oil. The outbreak of the war will almost bring global trade to a standstill. -Latin American countries also tended to be dependent on foreign credit which dried up at the outset of the war. This led many Latin American governments to curtail public works projects thus adopting a fiscal austerity approach. -War demand did allow the economy to partially recover overtime, however, as income from exports increased. But wartime demand led to rising prices. Many Latin American countries depended on British shipping. As a result of the war, shipping rates skyrocketed which led to higher prices. -The war will lead to a growth in importance of the United States at the expense of European economies, especially the United Kingdom (although the US will not overtake the UK). Trade with the US increased drastically during the War and the flow of US capital increased. 1
-Brazil was the only Latin American country to participate in the war beyond a symbolic declaration of war. -After a number of German attacks on Brazilian shipping Brazil declared war against Germany in October 1917. Brazil justified its entry by pointing to the German policy of unrestricted submarine warfare and the higher purpose of creating a more peaceful, democratic post war world (sound familiar?). -Her main contribution would be providing naval support in patrolling South American waters and minesweeping activities on the west coast of Africa. -In 1918 she sent a small number of troops overseas including a medical detachment. -Although her actual contribution to the allied effort was limited she was rewarded with a seat at the Paris Peace Conference. This was significant as the Treaty of Versailles set the new boundaries of the post war period. Brazil will be one of 27 nations that signed the treaty. 2
-Immediately after the war, the US experienced a series of economic shocks: -First the nation experienced rampant inflation. Price controls that had been implemented during the war to will be removed. Prices jumped by one-third in 1919 alone. -Then the nation experienced a two-year recession in 1920-21. -The end of the war shut down production at many factories since guns, bullets, uniforms, and the like were no longer needed. -With the sudden arrival of soldiers looking for work, women were forced to quit the jobs they had filled for the last two to three years. -The same patriotism that drove them to work was now supposed to drive them to quit. -few jobs led to mass unemployment. -By 1921, 12 million workers were unemployed. 1 out of 8 could not find work. -After the war, European countries began to grow their own crops again and no longer needed food exported from America. -Many farmers lost their farms because of overproduction and the dropping prices for farm goods. -The government tried to help but programs either did not work or were instituted too late. 3
-In a nation that valued free enterprise a large part of the American public regarded unions with distrust. -Their antiunion attitude softened during the Progressive era. Factory workers and their unions were offered a square deal under TR and protection from lawsuits under the Clayton Antitrust Act. -During the war, unions made important gains and membership increased. The American Federation of Labor had more than 3 million members. -In the postwar period, however, employers will try to rollback these advances and a series of strikes in 1919 turned public opinion against them. -More than 4 million workers went on strike in thousands of disputes (this was one in every five workers). There is inflation in the post war period and workers want increased wages to meet to pay for increased prices. -The first major strike of 1919 was in Seattle in February. Some 60,000 unionists joined shipyard workers in a peaceful strike for higher pay. Troops were called out but there was no violence. -In Boston in September police went on strike to protest the firing of a few police officers who tried to unionize. The National Guard was sent in to break the strike. -Also in September, workers for the US Steel Corporation struck in Pennsylvania. State and federal troops were called out and, after considerable vi0lence, the strike was broken in January 1920. -Savvy company owners used the Bolshevik Revolution in Russia as an example of what could 4
happen in America if unions continued to gain power. Most Americans came to believe that labor activists were Bolshevik agents. There was a small minority who believed that the wave of strikes and riots were the beginning of a world revolution. This led to the Red Scare: a general fear of subversion by radical socialist elements. Because many of the striking workers were foreign born and some immigrants held socialist views, immigrants became a common target of the Red Scare. 4
-A rash of bombings in 8 cities further intensified the Red Scare. In April of 1919 36 bombs were found in the mail addressed to government and business leaders. -One was meant for Attorney General Mitchell Palmer. He created a special office under the leadership of J. Edgar Hoover to gather information on radicals (originally known as the General Intelligence Division will become the FBI). -From November 1919 through January 1920 over 6,000 people were arrested based on limited criminal evidence. Most of the suspects were foreign born, and many were labeled radicals, anarchists, Socialists, and labor agitators. Many were deported. -Nicola Sacco and Bartolomeo Vanzetti were 2 Italian immigrants who were accused of murder and robbery outside a Boston shoe factory. While neither Sacco nor Vanzetti had any previous criminal record, they were long recognized by the authorities and their communities as anarchist militants who had been extensively involved in labor strikes, political agitation, and antiwar propaganda and who had had several serious confrontations with the law. In this atmosphere, when initial questioning by the police focused on their radical activities and not on the specifics of the Braintree crime, the two men lied in response. These falsehoods created a "consciousness of guilt" in the minds of the authorities. Did the lies of the two men signify criminal involvement in the Braintree murder and robbery, as the authorities claimed, or did they signify an understandable attempt to conceal their radicalism and protect their friends during a time of national hysteria concerning foreign-born radicals, as their supporters were to claim? Ultimately the 2 men were found guilty and eventually executed. Scholars still debate their guilt or innocence. But most agree that the trial itself was biased as the prosecution emphasized their ties to radical groups. -By the summer 1920 the Red Scare died out: communist revolutions in Europe died out, bombings tapered off, and the wave of riots and strikes tapered off. Nevertheless it had a lasting impact: 5
1.New restrictions on immigration were enacted: The National Origins Act was passed in 1924. The act cut immigration quotas to 2% of each nationality as reflected in the 1890 census. In 1929 a more restrictive quota went into effect setting a cap of 150,000 immigrants per year from Europe and continuing to ban most migrants from Asia. 2.Once again public perception turned against labor unions. 5
-The migration of African Americans to northern cities during the early 1900s is known as the Great Migration. It begins during WWI and continues throughout the 1930s. In these cities they found well paying jobs and the ability to vote. -This migration will help fuel a renaissance in African American art and culture that will be centered in Harlem in NY City in the 1920s. Harlem came to symbolize liberty and the promised land to Blacks everywhere. The Harlem Renaissance as a movement will champion racial pride. -But the Great Migration also increased racial tensions. Whites resented the increased competition for jobs and housing. Unionized whites resented blacks who served as strikebreakers. -In 1919, racial tensions led to violence in many cities earning the summer of 1919 the name the Red Summer. -The worst riot was in Chicago, where 40 people were killed and 500 were injured. -Altogether there were 25 race riots across the country in 1919. -The decade will be a period of transition for African Americans. Disappointed that the Progressive Era did not lead to significant political reforms for blacks, a new type of black political activist emerged; perhaps best exemplified by WEB DuBois. -African Americans emerged from World War I determined to fight for equality. Millions had loyally supported the war effort and 350,000 had served in uniform. 6
-Through the 1920s 3 Republican presidents would control the executive branch. Congress too was solidly Republican. -TR died in 1919, his loss combined with public disillusionment over the war allowed the return of the old-guard conservative Republican leadership. -This time however they accepted limited government regulation as an aid to stabilizing business. -The prevailing idea of the Republican party was that the nation would benefit if business and the pursuit of profits took the lead in developing the economy. -The 1920s began with a brief postwar recession in 1921, entered a lengthy period of business prosperity from 1922-1928 and ended in economic disaster in Oct. 1929 with the nation s worst stock market crash. -The business boom was due to increased productivity (principles of scientific management and efficiency studies), increased use of oil and electricity, and government policy (corporate tax cuts and doing almost nothing to enforce the antitrust laws of the Progressive era). -During the boom years unemployment was generally below 4%. -The standard of living for most Americans improved significantly. -Indoor plumbing and central heating became commonplace. By 1930 2/3 of all homes had electricity. -Real income for both the middle class and the working class increased substantially. 7
-Harding had been a newspaper publisher in Ohio before entering politics. He was considered handsome and well-liked. He was chosen as a compromise candidate and campaigned on the idea of return to normalcy. -As president, Harding was in over his head and self-doubt overwhelmed him. Harding recognized his limitations and hoped to make up for them by appointing able men to his cabinet - people such as Charles Evans Hughes as his secretary of state, Herbert Hoover as his secretary of commerce and Andrew Mellon as his secretary of Treasury. -However his presidency was marked by scandals and corruption similar to that of Grant. Having appointed some excellent officials, Harding also selected a number of incompetent and dishonest men to fill important positions including Secretary of the Interior Albert B. Fall and Attorney General Harry M. Daugherty. -In 1924, Congress discovered that Fall had accepted bribes for granting oil leases near Teapot Dome, Wyoming. -The term Teapot Dome came to represent numerous scandals throughout the Harding administration. For example Daugherty also took bribes for agreeing not to prosecute certain criminal suspects. -Harding died suddenly in Aug. 1923 of a heart attack before the scandals were uncovered and was never officially implicated in any of the scandals; however, due to the discovery of a long-term extramarital affair, the birth of an illegitimate child, and his corrupt appointees Harding is often considered one of the worst presidents in US history. 8
-Harding s vice president and successor, Calvin Coolidge had won popularity in 1919 as the Massachusetts governor who broke the Boston police strike. -He was a man of few words who richly deserved the nickname Silent Cal. -Coolidge believed in limited government that stood aside while business conducted its own affairs. -Coolidge wholeheartedly embraced the business doctrine. The Chief business of the American people is business. The man who builds a factory builds a temple. The man who works there worships there. -Little was accomplished in the White House except keeping a close eye on the budget. -Cutting spending to the bone, Coolidge vetoed even acts of the Republican majority in Congress. 9
-Many historians have argued that US foreign policy turned isolationist during the 1920s & 30s. And they point to the fact that the US did not join the League of Nations as evidence of that fact. It also true that most Americans turned inward and became much more concerned with domestic issues and the economic prosperity of the 20s. However, more recently historians have begun to question that argument. Many believe that although the US didn't commit itself militarily abroad that we can t characterize the US as isolationist during the 1920s. -Foreign policy of the 1920s was an attempt to advance American interests, maintain peace, and disarmament. -The greatest achievement of Harding s presidency was the Washington Conference in 1921. -Secretary of State Charles Evans Hughes initiated talks on naval disarmament to resolve conflicts in the Pacific. -Nations with the five largest navies agreed to maintain their current tonnage and agreed not to build any new ships for 10 years. Britain and the US agreed not to fortify their possessions in the Pacific and everyone agreed to respect each other s territory in the Pacific. -All 9 nations represented at the conference (US, GB, FR, Japan, IT, Belgium, China, Netherlands, Portugal) agreed to respect the open door policy in China. -The Kellogg-Brian Pact, negotiated by US Secretary of State Frank Kellogg and the French Foreign minister Aristide Briand, renounced the aggressive use of force to achieve national ends. It was an attempt to outlaw war. Eventually 62 nations signed. Ultimately it was ineffective because it permitted defensive wars and it failed to provide for taking action against violators of the agreement. 10
-the 20s also saw diplomacy used to advance American business interests in Latin America and the Middle East. -US investments in Latin America doubled between 1919 and 1929. -Secretary of State Hughes succeeded in winning oil-drilling rights for US companies in the Middle East. -They US emerged from WWI as a creditor nation. She had lent $10 billion to the allies. Harding and Coolidge expected them to pay it back. The allies balked. They saw the $10 billion as the US contribution to the war. In addition, the allies argued they couldn t pay the US back because Germany wasn t paying its reparations as required by the Treaty of Versailles. -The Dawes Plan was a compromise to settle the issue of war debts and reparations. This is how it worked: The US government would encourage US banks to lend money to Germany to rebuild and pay its reparations to the allies. The allies then in turn would pay back the US. (Do you see any problems with this plan? What would happen if US banks no longer had the cash (like if they lost of a lot of money when the stock market crashed) to lend to Germany? Do you see where this is headed)? -Ultimately however only Finland will fully pay back the US. The issue will leave resentment on all sides. Europeans saw the US as greedy and Americans saw it as a new reason to follow an isolationist path. 11
-It s clear that the US was much more comfortable intervening abroad diplomatically and economically than militarily. -One historian describes it as independent internationalist. WOULD YOU AGREE? 12