In the presidential
election of 1920, the overwhelming victory of the Republican nominee,
Warren G. Harding, was final evidence of the general repudiation of
Wilson's internationalism and idealism. As journalist William Allen
White explained, the American people were "tired of issues, sick at
heart of ideals, and weary of being noble."
The 1920 election
was also the first in which women throughout the nation voted for a
presidential candidate. In 1919 Congress had submitted to the states
the 19th Amendment, which was ratified in time to permit women to vote
the following year.
In keeping with
the prevailing prosperity (at least in the urban areas of the country),
governmental policy during the 1920s was eminently conservative. It
was based upon the belief that if government did what it could to foster
private business, prosperity would eventually encompass most of the
rest of the population.
Accordingly, Republican
policies were intended to create the most favorable conditions for U.S.
industry. The tariff acts of 1922 and 1930 brought tariff barriers to
new heights, guaranteeing U.S. manufacturers in one field after another
a monopoly of the domestic market. The second of these tariffs, the
Smoot-Hawley Act of 1930, embodied rates so high that more than 1,000
economists petitioned President Herbert Hoover to veto it: subsequent
events bore out their predictions of costly retaliation by other nations.
At the same time, the federal government started a program of tax cuts,
reflecting Treasury Secretary Andrew Mellon's belief that high income
taxes prevented the rich from investing in new industrial enterprises.
Congress, in a series of laws passed between 1921 and 1929, responded
favorably to his proposals that wartime taxes on income, excess profit
taxes and corporation taxes be repealed outright or drastically reduced.
"The chief business
of the American people is business," declared Calvin Coolidge, the dour,
Vermont-born vice president who succeeded to the presidency in 1923
after Harding's death, and was elected in his own right in 1924. Coolidge
hewed to the conservative economic policies of the Republican Party,
but he was a much abler administrator than the hapless Harding, whose
administration was mired in charges of corruption in the months before
his death.
Throughout the
1920s, private business received substantial encouragement, including
construction loans, profitable mail-carrying contracts and other indirect
subsidies. The Transportation Act of 1920, for example, had already
restored to private management the nation's railways, which had been
under government control during the war. The Merchant Marine, which
had been owned and largely operated by the government from 1917 to 1920,
was sold to private operators.
Republican policies
in agriculture, however, were meeting mounting criticism, for farmers
shared least in the prosperity of the 1920s. The period from 1900 to
1920 had been one of general farm prosperity and rising farm prices,
with the unprecedented wartime demand for U.S. farm products providing
a strong stimulus to production. Farmers had opened up poor lands long
allowed to remain idle or never before cultivated. As the value of U.S.
farms increased, farmers began to buy goods and machinery that they
had never before been able to afford. But by the end of 1920, with the
abrupt end of wartime demand, the commercial agriculture of staple crops
such as wheat and corn fell into sharp decline. Many factors accounted
for the depression in American agriculture, but foremost was the loss
of foreign markets. U.S. farmers could not easily sell in areas where
the United States was not buying goods because of its own import tariff.
The doors of the world market were slowly swinging shut. When the general
depression struck in the 1930s, it merely shattered agriculture's already
fragile state.