“Whatcha got ain’t nothin new. This country’s hard on people, you can’t stop what’s coming, it ain’t all waiting on you. That’s vanity.” – Ellis, No Country for Old Men (2007)

By 1920, Americans were tired of wars abroad and progressive programs at home. The “high-minded” rhetoric had lost its appeal as the country was in a conservative mood.

Warren Harding

The only president elected on his birthday, Harding promised a return to normalcy. There was to be nothing big nor ambitious accomplished, but the creation of a quiet, calm period.

Harding was a former newspaper man. He was rumored to be an extrovert, gambler, drinker and womanizer. He played the sousaphone and loved to be around people, gladhand and slap folks on the back. These of course proved to be valuable political skills.

Many felt Harding wasn’t fit to be president for he lacked the intellect and ambition. Many thought he didn’t even want to be the President of the United States of America nor had the confidence in himself to do the job. Harding was savvy, though, and knew what he wanted to accomplish.

Harding acknowledged that he did not have all the answers but would hire the “best minds.” There was some truth to this as his Secretary of State was Charles Evan Hughes, and his Secretary of Commerce was future President Herbert Hoover.

Budget and Accounting Act of 1921

Before the Budgeting & Accounting Act of 1921, no single government entity oversaw the entire budget. Departments submitted requests to Congress.

After World War I, Congress saw wartime spending had raised the national debt and exerted more control over government expenditures. The restrictions in the act keep either branch from dominating budget decisions.

The act requires the president to submit a budget to Congress every year by the first Monday of February. The president has to justify that budget so, depending on which party controls Congress, this usually leads to disagreements over what government programs deserve money. Both parties have used this approval process to push their own agendas.

The 14th Amendment says the government’s debt can’t be questioned. If Congress refuses to approve enough money to pay debts, conceivably the President could override that decision to fulfill the Constitution’s guidelines. This act raises the debt ceiling.

When the act created the Bureau of the Budget, it essentially gave the president control over individual departments. This bureau gathers and evaluates the competing requests of governmental departments and agencies. This allows the President to create a comprehensive budget. He can reduce or raise requests from each department. In 1970, the Bureau of the Budget was renamed the Office of Management and Budget.

The act also created a wing that gives Congress the power to audit government departments. The Governmental Accountability Office, originally called the General Accounting Office, tells the House and Senate what it may need to cut or expand in the future. Congress sends the president’s budget back to the White House with the changes it wants. The legislative and executive branches then negotiate a compromise.

Washington Naval Conference

More formally known as the International Conference on Naval Limitation, the Washington Naval Conference was a disarmament effort occasioned by the hugely expensive naval construction rivalry that existed among Britain, Japan and the United States. Senator William E. Borah, R-Idaho, took the lead on this matter and urged that the major Allied nations from the recent war gather in an effort to slow the arms race. The proposal was not met with initial enthusiasm by the Harding administration, but it became a political imperative when it was portrayed as a Republican alternative to the League of Nations’ peace efforts.

In the summer of 1921, Harding extended invitations and expanded the agenda beyond arms control to include discussion of issues in the Pacific and Far East. The formal opening of the Washington Naval Conference occurred on Armistice Day 1921. The major naval powers of Britain, France, Italy, Japan and the United States were in attendance as well as other nations with concerns about territories in the Pacific — Belgium, the Netherlands, Portugal and China — who were not parties to the disarmament discussions. Soviet Russia was not invited, nor were the defeated Central Powers. The American delegation was led by Charles Evans Hughes, the secretary of state, and included Elihu Root, Henry Cabot Lodge and Oscar Underwood, the Democratic minority leader in the Senate.

In the initial session, Hughes shocked the delegates by going beyond platitudes and offering a detailed plan for arms reduction. Labeled by some as one of the most dramatic moments in American diplomatic history, Hughes called for the scrapping of nearly two million tons of warships and a lengthy “holiday” on the construction of new ships. He was widely hailed in the press as a savior, but leaders of the other Allied governments were quietly skeptical.

Over the following weeks, a series of agreements was concluded:

Four-Power Pact (December 13, 1921). The major Allied powers — Britain, France, Japan and the United States — agreed to submit disputes among themselves over Pacific issues to a conference for resolution.

Four-Power Pact (December 13, 1921). The same Allied powers pledged mutual respect for the possessions and mandates of other signatories in the Pacific.

Shantung Treaty (February 4, 1922). The territory of Kiaochow in Shantung (Shandong) province was returned by Japan to China. The area had been leased by Germany in 1898, but was seized by Japan at the outbreak of war in 1914.

Nine-Power Treaty (February 6, 1922). The signatories — the Big Four, plus Italy, Belgium, the Netherlands, Portugal and China — endorsed the Open Door Policy and pledged mutual respect for Chinese territorial integrity and independence.

Nine-Power Treaty (February 6, 1922). The same Allied powers agreed to extend Chinese control over trade matters within Chinese borders.

Five-Power Naval Limitation Treaty (February 6, 1922). This agreement implemented the sweeping proposals of Hughes in somewhat modified terms. The leading naval powers — Britain, France, Italy, Japan and the United States — pledged adherence to limitations on the tonnage of capital ships and accepted a moratorium on new naval construction.

Five-Power supplemental treaty. The major Allied naval powers agreed on a series of rules for the use of submarines in future warfare and also outlawed the use of poisonous gases as a military weapon.

Six-Power Pact. The Big Five Nations plus China agreed to the allocation among themselves of former German cable routes in the Pacific.

Yap Island agreement. The United States and Japan agreed on provisions for U.S. use of the Pacific island as a distribution point for the transpacific cable.

In the following months, the U.S. Senate ratified all of the treaties from the Washington Conference. However, a reservation was attached to the Four-Power Pact stating that no agreement had been approved that required the “commitment of armed force” by the United States.

Harding Is Guilty By Association

Harding took a train trip west in the summer of 1923 becoming the first sitting president to visit Alaska. His health was failing though, and on July 29th he checked into the Presidential suite of the Palace Hotel in San Francisco to recuperate. He died there four days later of a heart attack.

Why is Harding remembered as a joke and failure with a comprehensive budget deal and an arms reduction treaty? Less than a year after his death, several scandals emerged.

Teapot Dome Scandal

During the Teapot Dome scandal, Albert B. Fall, who served as secretary of the interior in President Warren G. Harding’s cabinet, was found guilty of accepting a bribe while in office. Fall was the first individual to be convicted of a crime committed while a presidential cabinet member.

As a member of President Harding’s corruption-ridden cabinet in the early 1920s, Hall accepted a $100,000 interest-free “loan” from Edward Doheny of the Pan-American Petroleum and Transport Company, who wanted Fall to grant his firm a valuable oil lease in the Elk Hills naval oil reserve in California. The site, along with the Teapot Dome naval oil reserve in Wyoming, had been previously transferred to the Department of the Interior on the urging of Fall, who evidently realized the personal gains he could achieve by leasing the land to private corporations.

In October 1923, the Senate Public Lands Committee launched an investigation that revealed not only the $100,000 bribe that Fall received from Doheny but also that Harry Sinclair, president of Mammoth Oil, had given him some $300,000 in government bonds and cash in exchange for use of the Teapot Dome oil reserve in Wyoming.

In 1927, the oil fields were restored to the U.S. government by a Supreme Court decision. Two years later, Fall was convicted of bribery and sentenced to one year in prison and a fine of $100,000. Doheny escaped conviction, but Sinclair was imprisoned for contempt of Congress and jury tampering. Again, there is no real evidence President Harding was complicit or personally benefitted, but he is definitely guilty of appointing mediocre and dishonest people to positions.

Marital Infidelity

Two scandalous books were published with one saying Harding’s wife Florence poisoned him. Also, it was revealed Harding had an affair with Nan Britton who had given birth to his daughter.

At the time, these scandals were highly believed at the time. Unfortunately, Harding is remembered for scandals both real and imagined. History may have been unfair to him, but his real tragedy was that he was unable to live out his first term. From what we know, he was good with Congress, good with foreign affairs and good with the budget.

Bitching

Modern budgeting debates still hinge on the powers given to the Congress and the President in this act. The act didn’t link the budgeting process to the amount of revenues brought in through taxes. The result is deficits and surpluses since the budget isn’t based on what money is available. It puts the focus on what the country wants rather than what it can afford. In practice, Congress approves expenses and then later determines if it will increase the government’s ability to borrow money.

With Harding, we also see the danger in electing a President who is a media entertainer, unfocused on policy but promising to “hire the best people.” Unfortunately, we have done that before in the United States. The results were mixed.

Woodrow Wilson preceded him

Calvin Coolidge would follow him.

It all started with George Washington.

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