HIST 1312 1st Edition Lecture 9Outline of Last Lecture I. Prosperity Decadea. The Economics of Prosperityb. The Automobile: Driving the Economyc. "Get Rich Quick": The Speculative Mania d. Agriculture: Depression in the Midst of Prosperity II. The Roaring Twentiesa. The Automobile and American Lifeb. A Homogenized Culture Searches for Heroes c. Alienated Intellectualsd. Renaissance Among African-Americanse. “Flaming Youth”III. Traditional America Roars BackIV. Race, Class, and Gender in the 1920sV. The Politics of ProsperityOutline of Current Lecture I. The Diplomacy of Prosperitya. Foreign Affairsb. The United States and Latin AmericaThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.c. America and the European Economyd. Origins of the Depressione. The Stock Market PlungeII. Hoover’s Final EffortsIII. Depression in the U.S.a. Families in the Depressionb. Discrimination in the Depression c. Franklin D. RooseveltCurrent Lecture: From Good Times to Hard Times to the New Deal, 1920-1932I. The Diplomacy of Prosperity a. Foreign Affairs- President Harding dismissed any U.S. role in the League of Nations and refused the Treaty of Versailles. o Secretary of State Charles Evans Hughes concluded separate peace treaties to end the U.S. role in World War I. - American banks and corporations begin to expand as a result of international economic changes caused by World War I. o American businesses had become the world’s major producers. o American business shaped the global economy by lending money. - Neither President Harding nor President Coolidge had any expertise or interest in foreign affairs and deferred making and implementing policy to their secretaries of state. o Their secretaries supported "independent internationalism": avoiding political and international responsibilities while expanding economic opportunities overseas. o Secretary of Commerce Herbert Hoover also promoted American business abroad. o While successes in Asia and the Middle East were limited, efforts in LatinAmerica and Europe were quite successful. b. The United States and Latin America - The U.S. role in Latin America, especially Central America and the Caribbean, was influenced by the Monroe Doctrine, direct American investments, and control of the Panama Canal. - When necessary, the United States used direct armed intervention in the region (The Marines).o In 1921, the U.S. had troops in Panama, Haiti, the Dominican Republic, and Nicaragua to ensure continued U.S. influence and order.  Roosevelt’s “Policing of Western Hemisphere”o U.S. forces had not advanced the educational systems, national economies, or standards of living for most people.  Use of marines weren’t used to further Democracy or freedom, they protected American business interests. Americas economic interests came in front of social justices- Elsewhere in Latin America, the 1920s saw U.S. commercial intervention in the region. o U.S. firms like the United Fruit Company purchased land in Central America.  Specifically Guatemalao U.S. oil companies obtained drilling rights in Venezuela and Colombia. - Oil also played a key role in U.S. relations with Mexico, since the 1917 Mexican Constitution nationalized Mexico’s subsurface resources. o Coolidge sent Dwight W. Morrow as U.S. ambassador "to keep us out ofwar" since Morrow understood Mexican nationalism and pride. o Morrow reached a compromise with the Mexican government that reduced tensions and delayed nationalization. c. America and the European Economy - World War I shattered most of Europe physically and economically, and the U.S. had become the world’s leading creditor nation. o The U.S. sought to expand its exports and reduce its imports. o High tariffs inched higher throughout the 1920s, including the 1922 Fordney-McCumber Tarif, which set high protective rates for industrial goods.  Tariff protected American jobs by raising cost of outside goodso Through the Dawes Plan, U.S. bankers loaned $2.5 million to Germany so that it could repay the other European nations and they could repay the U.S. - The Kellogg-Briand Pact (1929) renounced war "as an instrument of national policy." Every country signed on to outlaw ward. Origins of the Depression - The prosperity of the 1920s depended on a few major industries - construction, automobiles, and consumer goods - since other sectors of the economy barely made a profit. o Farmers watched demand for their goods shrink while income and property values declined. - Other problems included the misdistribution of wealth and the overproduction of goods. o Needed government intervention- Upon assuming office, President Hoover tried to stimulate trade by lowering tariffs up to 50 percent, but most Republicans disagreed.o Hoover won against Al Smith, the first Catholic nominated by a major party Many believe Hoover won because Smith was Catholice. The Stock Market Plunge - The desire to invest in the stock market fed a speculative fever that pushed stockprices higher and higher. o By 1929, stock prices had little relationship to a company’s worth. o Finally, in 1929, the realities of wages, credit, inflated stock prices, and the slowing American economy collided. o Despite a lack of public concern, events on Black Thursday affected everyone as the selling price and value of stocks plummeted. - The stock market crash undermined economic confidence. o A lot of suicideso No more confidence in the banking system- worried that their money would be gone from the bank because of bad investment choices o Created a lot of doubts causing everything to stop (spending money, going out, marriages, etc.)- The effects of the stock market crash and the declining American economy had an international impact. II. Hoover’s Final Efforts- Over the next two years, Hoover greatly expanded the role of government in responding to the Depression. o By December 1931, Hoover promoted more direct federal involvement and asked Congress for support through banking reforms and financial support for home mortgages. o Hoover also intended to pump money into the economy through the Reconstruction Finance Corporation. o All this represented an unprecedented effort by the federal government to intervene directly in the nation’s economy. - Hoover opposed direct federal relief (money to the unemployed), the