WARREN HARDING: A GUIDE FOR OUR TIME
Warren Gamaliel Harding (1920-2) is generally described by political historians as one of the worst American Presidents. Yet there are plenty of reasons to argue that he was one of the most successful in the twentieth century and his economic and fiscal policies are relevant to today’s crisis.
It is worth considering why a President, who was highly successful in the limited and constitutional role he believed the President should play, is so lowly rated by historians.
One reason is undoubtedly the fact that the famous Chinese proverb ‘May you not live in interesting times’ does not apply to historians’ assessment of past Presidents. They admire activity, even if it is of the animal-shooting, rough-riding Theodore Roosevelt, or the glamorous back-story of John F. Kennedy, and particularly admire Presidents such as Lincoln, Woodrow Wilson and FDR, who were war leaders. Wars are important and need good leadership but peacetime good government is perhaps even more difficult as the patriotic and self-sacrifice impulses are not available to leaders. A second reason is that Harding died suddenly and was unable to write his own history and justify his own actions as was done by Hoover or by the acolytes of Kennedy, Reagan and Roosevelt.
Third, Harding did not meet the historians’ need for excitement and extension of government activity but he did meet the needs of the American people. He cleaned up the enormous problems left by Woodrow Wilson after the First World War and acted constitutionally, peacefully and sensibly.
Indeed, he acted out his own philosophy of ‘normalcy’ – a term of derision, for some unexplained reason for historians – put here in his own words:
“America’s need is not heroics, but healing; not nostrums, but normalcy; not revolution, but restoration; not agitation, but adjustment; not surgery, but serenity; not the dramatic, but the dispassionate; not experiment, but equipoise; not submergence in internationality, but sustainment in triumphant nationality.”
This is a superb description of good peacetime government and was immensely popular with the electorate, if not with historians.
WOODROW WILSON – THE LEGACY
Harding succeeded Woodrow Wilson in March 1921. The United States was in an extraordinary constitutional crisis where the right of access to the ill President had been usurped by his wife and the Cabinet was not allowed to meet. No peace treaties had been signed by the United States with its First World War enemies. The League of Nations’ dispute had disrupted the US government and relations between the Congress and the President. Reparations were in chaos, there was a Red Scare, anarchist bombings and many who had opposed the war were still locked up. Above all at the beginning of 1921 the US economy was about to enter the sharpest recession in its history.
Despite all the disasters listed above, Woodrow Wilson has always had a good write up from historians even though there is usually a glossing over of the last year and a half of his Presidency.
In September 1919, Wilson suffered a stroke and patently should have resigned. In recent years, research into Wilson’s earlier life has revealed that he had had numerous minor strokes before and during his presidency. The medical records of his doctor, made available in 2006, show there is reasonable argument that many of Wilson’s erratic and strange public decisions may have been due to underlying medical problems. There began an extraordinary eighteen months in the US Presidency which are barely known about.
His second wife, Edith Wilson, forbade access to the ill Wilson to almost all the Cabinet and monitored what papers went to Wilson. He was disabled but retained some functioning ability. He forbade the Cabinet to meet and fired Robert Lansing, the Secretary of State, when he called an informal Cabinet meeting. Edith Wilson put Wilson’s own interests above that of his office. She felt “that he would recover faster if he stayed in office than he would if he resigned”.
Wilson’s administration had anyway lapsed into inactivity after his failure to get the US to join the League of Nations. His illness made things worse.
HARDING’S ACHIEVEMENTS
Harding was a believer in limited government, a free economy and he was a moderate. He believed in ‘normalcy’.
He rapidly cleared up the political aftermath of the World War.
Among others, he pardoned the Socialist candidate, for the President, Eugene Debs, who had been put in prison by Wilson for opposing the draft and also amnestied those who had been imprisoned during the Red Scare of 1919.
He signed the peace treaties to end the War. Later he negotiated the Washington Conference on naval disarmament in 1922.
Another problem created by Wilson, was bad relations with Mexico and military occupation of Haiti and the Dominican Republic. Harding got the US out of the Dominican Republic and restored good relations with Mexico.
HARDING’S ECONOMIC SUCCESS
Harding also achieved a rapid ending of the deep recession of 1920/2 which had begun before he took office.
His actions formed the template for the actions of Harry Truman in the aftermath of the Second World War in avoiding a return to Depression after the demobilisation of 12 million men in 1946.
The US economy began a sharp decline at the beginning of 1921. Estimated GNP fell 24 per cent from $91.5 billion in 1920 to $69.6 billion in 1921 and there was a deflation even more severe than during the Great Depression with a plunge of 36.8 per cent in wholesale prices in 1920-2. The number of unemployed rose from 2.1 million to 4.9 million, 15 per cent of the workforce.
Harding’s response was to lower taxes and cut regulation and put the government’s own finances into order. He wanted to “strike the shackles from industry … we need vastly more freedom than regulation”.
In other words, he aimed to create the conditions for profitable economic activity, the only method which would bring about recovery.
He put forward the Budget and Accounting Act and cut federal spending in half between 1920 and 1922. He cut taxes by a third from $6.5 billion to $4 billion and paid off some of Wilson’s debt. A defining moment was his decision to veto the Veterans Bonus Bill just before the congressional elections of 1922. This measure for public spending was enthusiastically mooted by Congress and it took political courage to veto it.
As a result, by 1922 GNP increased and unemployment fell back to 2.8 million. GNP continued to increase and unemployment continued to reduce throughout the 1920’s. Harding did not pursue programmes to make labour more expensive or to prop up sick industries. Wages were allowed to fall to realistic levels and markets were allowed to clear.
There were no attacks on business, no extra regulation and no big government projects.
OTHER SUCCESSES
Another area where Harding reset policy was to support the curtailment of immigration which had long been put forward by Congress but could not get the support of previous Presidents. The Immigration Act of 1921 reduced immigrant numbers from 805,228 in 1921 to 309,556 in 1922. This relieved the US economy from the deadweight of providing the capital requirements of immigrants. This deadweight was vastly in excess of the relatively minor benefits of keeping wages down. At the same time it opened up the labour market for Southern blacks as urged by Booker Washington, Philip Randolph and others. Southern blacks moved North to take up industrial jobs in their millions (7 million in the 1920’s) from which they had been excluded by immigration.
Certainly, Harding made mistakes and missteps but they were relatively minor in the context of the major decisions outlined above. There continued to be a sour relationship between Congress and the Presidency, a leftover from the bitter days of the League of Nations dispute and the high-handedness of Woodrow Wilson. The vetoing of the Veterans Bonus Bill despite protecting the US taxpayer was not popular with Congress.
Harding was also mistakenly an enthusiast for tariffs.
After his death, it came to light that there was a lot of graft and corrupt practices in his administration. While this was a debit against Harding’s Presidency, it is relatively insignificant when placed against his successes.
HARDING – THE JUDGEMENT
Why is a President, who was so successful, and whose handling of the 1920/2 recession points the way out of the current global crisis, so little esteemed by historians?
It seems to be that historians like interesting times, times of War, conferences, events. In particular, there is a bias to approving the extension of government activity and spending. They despise ‘normalcy’ as provincial and boring. But this is the opposite of what the electorate wants. The electorate wants peace and prosperity, not agitation and experiments.
As Harding said, “We must uproot from our national government the yearning to undertake enterprises and experiments which were never intended as the work of government”.
But, today, looking around the present governments of Britain and the US there is a fevered effort to expand government and regulation. These are all the policies Harding warned against: ‘heroics’, ‘nostrums’, ‘experiment’, ‘agitation’ and ‘submergence in internationality’.
I do not suppose historians will like the word ‘internationality’ more than ‘normalcy’.
The summing up of Harding’s Presidency was that he was an exceptionally successful peacetime President, preserving limited government, cleaning up the mistakes of his predecessor and setting the US on course for its fabulous decade of peace and prosperity and social equilibrium known as the ‘Roaring Twenties’. But he is not a favourite of historians – yet.
FUTURUS/26 November 2011
It is worth considering why a President, who was highly successful in the limited and constitutional role he believed the President should play, is so lowly rated by historians.
One reason is undoubtedly the fact that the famous Chinese proverb ‘May you not live in interesting times’ does not apply to historians’ assessment of past Presidents. They admire activity, even if it is of the animal-shooting, rough-riding Theodore Roosevelt, or the glamorous back-story of John F. Kennedy, and particularly admire Presidents such as Lincoln, Woodrow Wilson and FDR, who were war leaders. Wars are important and need good leadership but peacetime good government is perhaps even more difficult as the patriotic and self-sacrifice impulses are not available to leaders. A second reason is that Harding died suddenly and was unable to write his own history and justify his own actions as was done by Hoover or by the acolytes of Kennedy, Reagan and Roosevelt.
Third, Harding did not meet the historians’ need for excitement and extension of government activity but he did meet the needs of the American people. He cleaned up the enormous problems left by Woodrow Wilson after the First World War and acted constitutionally, peacefully and sensibly.
Indeed, he acted out his own philosophy of ‘normalcy’ – a term of derision, for some unexplained reason for historians – put here in his own words:
“America’s need is not heroics, but healing; not nostrums, but normalcy; not revolution, but restoration; not agitation, but adjustment; not surgery, but serenity; not the dramatic, but the dispassionate; not experiment, but equipoise; not submergence in internationality, but sustainment in triumphant nationality.”
This is a superb description of good peacetime government and was immensely popular with the electorate, if not with historians.
WOODROW WILSON – THE LEGACY
Harding succeeded Woodrow Wilson in March 1921. The United States was in an extraordinary constitutional crisis where the right of access to the ill President had been usurped by his wife and the Cabinet was not allowed to meet. No peace treaties had been signed by the United States with its First World War enemies. The League of Nations’ dispute had disrupted the US government and relations between the Congress and the President. Reparations were in chaos, there was a Red Scare, anarchist bombings and many who had opposed the war were still locked up. Above all at the beginning of 1921 the US economy was about to enter the sharpest recession in its history.
Despite all the disasters listed above, Woodrow Wilson has always had a good write up from historians even though there is usually a glossing over of the last year and a half of his Presidency.
In September 1919, Wilson suffered a stroke and patently should have resigned. In recent years, research into Wilson’s earlier life has revealed that he had had numerous minor strokes before and during his presidency. The medical records of his doctor, made available in 2006, show there is reasonable argument that many of Wilson’s erratic and strange public decisions may have been due to underlying medical problems. There began an extraordinary eighteen months in the US Presidency which are barely known about.
His second wife, Edith Wilson, forbade access to the ill Wilson to almost all the Cabinet and monitored what papers went to Wilson. He was disabled but retained some functioning ability. He forbade the Cabinet to meet and fired Robert Lansing, the Secretary of State, when he called an informal Cabinet meeting. Edith Wilson put Wilson’s own interests above that of his office. She felt “that he would recover faster if he stayed in office than he would if he resigned”.
Wilson’s administration had anyway lapsed into inactivity after his failure to get the US to join the League of Nations. His illness made things worse.
HARDING’S ACHIEVEMENTS
Harding was a believer in limited government, a free economy and he was a moderate. He believed in ‘normalcy’.
He rapidly cleared up the political aftermath of the World War.
Among others, he pardoned the Socialist candidate, for the President, Eugene Debs, who had been put in prison by Wilson for opposing the draft and also amnestied those who had been imprisoned during the Red Scare of 1919.
He signed the peace treaties to end the War. Later he negotiated the Washington Conference on naval disarmament in 1922.
Another problem created by Wilson, was bad relations with Mexico and military occupation of Haiti and the Dominican Republic. Harding got the US out of the Dominican Republic and restored good relations with Mexico.
HARDING’S ECONOMIC SUCCESS
Harding also achieved a rapid ending of the deep recession of 1920/2 which had begun before he took office.
His actions formed the template for the actions of Harry Truman in the aftermath of the Second World War in avoiding a return to Depression after the demobilisation of 12 million men in 1946.
The US economy began a sharp decline at the beginning of 1921. Estimated GNP fell 24 per cent from $91.5 billion in 1920 to $69.6 billion in 1921 and there was a deflation even more severe than during the Great Depression with a plunge of 36.8 per cent in wholesale prices in 1920-2. The number of unemployed rose from 2.1 million to 4.9 million, 15 per cent of the workforce.
Harding’s response was to lower taxes and cut regulation and put the government’s own finances into order. He wanted to “strike the shackles from industry … we need vastly more freedom than regulation”.
In other words, he aimed to create the conditions for profitable economic activity, the only method which would bring about recovery.
He put forward the Budget and Accounting Act and cut federal spending in half between 1920 and 1922. He cut taxes by a third from $6.5 billion to $4 billion and paid off some of Wilson’s debt. A defining moment was his decision to veto the Veterans Bonus Bill just before the congressional elections of 1922. This measure for public spending was enthusiastically mooted by Congress and it took political courage to veto it.
As a result, by 1922 GNP increased and unemployment fell back to 2.8 million. GNP continued to increase and unemployment continued to reduce throughout the 1920’s. Harding did not pursue programmes to make labour more expensive or to prop up sick industries. Wages were allowed to fall to realistic levels and markets were allowed to clear.
There were no attacks on business, no extra regulation and no big government projects.
OTHER SUCCESSES
Another area where Harding reset policy was to support the curtailment of immigration which had long been put forward by Congress but could not get the support of previous Presidents. The Immigration Act of 1921 reduced immigrant numbers from 805,228 in 1921 to 309,556 in 1922. This relieved the US economy from the deadweight of providing the capital requirements of immigrants. This deadweight was vastly in excess of the relatively minor benefits of keeping wages down. At the same time it opened up the labour market for Southern blacks as urged by Booker Washington, Philip Randolph and others. Southern blacks moved North to take up industrial jobs in their millions (7 million in the 1920’s) from which they had been excluded by immigration.
Certainly, Harding made mistakes and missteps but they were relatively minor in the context of the major decisions outlined above. There continued to be a sour relationship between Congress and the Presidency, a leftover from the bitter days of the League of Nations dispute and the high-handedness of Woodrow Wilson. The vetoing of the Veterans Bonus Bill despite protecting the US taxpayer was not popular with Congress.
Harding was also mistakenly an enthusiast for tariffs.
After his death, it came to light that there was a lot of graft and corrupt practices in his administration. While this was a debit against Harding’s Presidency, it is relatively insignificant when placed against his successes.
HARDING – THE JUDGEMENT
Why is a President, who was so successful, and whose handling of the 1920/2 recession points the way out of the current global crisis, so little esteemed by historians?
It seems to be that historians like interesting times, times of War, conferences, events. In particular, there is a bias to approving the extension of government activity and spending. They despise ‘normalcy’ as provincial and boring. But this is the opposite of what the electorate wants. The electorate wants peace and prosperity, not agitation and experiments.
As Harding said, “We must uproot from our national government the yearning to undertake enterprises and experiments which were never intended as the work of government”.
But, today, looking around the present governments of Britain and the US there is a fevered effort to expand government and regulation. These are all the policies Harding warned against: ‘heroics’, ‘nostrums’, ‘experiment’, ‘agitation’ and ‘submergence in internationality’.
I do not suppose historians will like the word ‘internationality’ more than ‘normalcy’.
The summing up of Harding’s Presidency was that he was an exceptionally successful peacetime President, preserving limited government, cleaning up the mistakes of his predecessor and setting the US on course for its fabulous decade of peace and prosperity and social equilibrium known as the ‘Roaring Twenties’. But he is not a favourite of historians – yet.
FUTURUS/26 November 2011