Lloyd Gardner’s Economic Aspects of New Deal Diplomacy attacked a 1950’s idealistic New Deal legend and inspired historians to review Franklin D. Roosevelt’s policies. The author stated that FDR’s background knowledge and beliefs, especially during 1930’s Asian Open Door policies, played a critical role in developing New Deal programs. Gardner also focused on developments prior to 1933 and then after World War II. Professor Gardner then explored the role of Secretary of State Cordell Hull along with important financiers who aided the president. Lloyd Gardner asserts in Economic Aspects of New Deal Diplomacy that older traditions and policies influenced FDR’s approach to foreign diplomacy/New Deal programs and contends that additional involvement by Secretary of State Hull and well-known financiers influenced events as well.

Events in the twenties and early thirties helped shape New Deal policies, and the administrations of Presidents Harding, Coolidge, and Hoover all played a pivotal role in this development. Gardner in Economic Aspects of New Deal Diplomacy reviewed Hoover’s Administration in order to explain the origins of Roosevelt’s planned economy. President Hoover’s farewell address included a plea for international cooperation believing that America’s depression was linked to the entire globe’s economic welfare. Banks folded across the nation and Hoover called for an adoption of an international spirit. After all from 1923 to 1929 “foreign trade soared to all time heights.” (8) Hoover’s plans envisioned a peaceful Open Door expansionism and one that excluded the possibility of war among the various nations. Hoover also called for a national self-containment if the international plan failed to materialize. The Hoover Administration constructed the Reconstruction Finance Corporation and the Federal Farm Board to provide such national planning. However, Hoover’s third “road” for the United States contained measures for inflationary tactics that included abandoning the gold standard and promoting an economic war, and unfortunatly Roosevelt adopted this method initially. Hoover continued to try and convince the Roosevelt administration to remain on the pathway of international debt negotiations, disarmament talks, and requests for an international conference in order to discuss economics.

Politically President Roosevelt wanted nothing to do with Europe and sided with isolationist and neutrality-minded individuals, and his initial New Deal policies reflect this. In an amazing display of solidarity Congress quickly enacted legislation like the National Recovery Administration (NRA), the Agricultural Adjustment Administration (AAA), and the Reciprocal Trade Agreements Act. Isolationism, nationalism, and forming a big navy monopolized FDR’s domestic and foreign policy during his early years in office. Other issues such as internationalism versus self-containment deeply concerned the president. Also the depression that began in 1929 continued unabated in 1933.

It soon became evident that the NRA, AAA, and other New Deal measures were inadequate, and the New Deal seemed destined to be plagued by difficulties. Congress set up the NRA to administer the policies of the National Industrial Recovery Act. This act provided self-government to industry and trade associations and also what amounted to price fixing tactics. The United States Supreme Court later declared it unconstitutional.

Open Door and most-favored-nation principles remained paramount to United States foreign policy. Here the presence of Secretary of State Cordell Hull emerged and began with the Reciprocal Trade Agreements Act (1934). Hull’s economic plan started to develope in this time frame and continued on a determined path for the next ten years. Roosevelt and Hull often clashed in the beginning years, but the two men eventually coalesced on governmental policies.

Roosevelt’s Good Neighbor Policy operated from 1933 to 1937. Again the Hoover administration played a role in the development of the policy with then Secretary of State Stimson instilling the idea of an American trained militia to provide domestic security to Latin American countries. The United States later provided economic aid in exchange for trade agreements. Brazil received a sixty million dollar loan to keep trade away from Germany in the mid 1930’s. Also 1930’s Asian Open Door policies inherited Hoover’s pioneer work. Japan proved to be a pretty stubborn thorn, and as early as 1937 the United States knew Open Door policy and the formation of the Nine Power Treaty methods of diplomacy were breaking down.

Growing European unrest impacted the United States’ isolationist position and influenced decisions made regarding Latin America and Japan. Secretary of State Hull attempted to negotiate with both countries for economic reciprocity but always insisted on American principles as a sine qua non. Internal unrest in Latin American countries provoked loans to disreputable governments like in Nicaragua. Oil nationalization in Mexico placed United States’ companies at an economic disadvantage and jeopardized other United States’ Latin American holdings. Then the outbreak of war forced the United States to concentrate on removing any Axis loyalty in Latin America. In addition to Latin America, Washington now dealt with Japan with less hope. Japanese resistance to the Open Door increased through the years 1931 to 1937 and continued with Japan joining the Axis Tripartite Pact. Pearl Harbor destroyed all hope of reaching an economic compromise to trade with Asain markets.

Financiers such as Norman Davis, Thomas Lamont, and Will Clayton influenced political and economical events during the Roosevelt years. Norman Davis supplied economic advice to both President Hoover and President Roosevelt. His contributions involved discussions with the British over naval disarmament in 1933, on French foreign policy and the conflict over disarmament talks turning into political alliance talks in Geneva, and British and American trade polices - writing to Secretary of State Hull that “so long as the world’s nations continued to strangle trade, they would be committing international suicide.” (106) Thomas Lamont of J.P. Morgan and Company backed the Good Neighbor Policy and refuted gunboat diplomacy. Lamont also strongly dictated strict measures with Japan, as he was present in Siberia during Japan’s intervention. Lamont also expressed the financial communities’ opinion on the gold problem, postwar relations with Britain, and later on Soviet policy in Poland. Will Clayton opposed high tariffs in Latin America and stressed the importance of foreign trade.

Ultimately, New Deal policies, both foreign and domestic, reflect past United States government policies such as those that President Hoover’s administration adopted. Another example would be the Export-Import Bank that replaced the 1920’s practice of private loans. Secretary of State Cordell Hull continued the United States Open Door Policy and reached his peak in negotiations with Japan in 1941. Economic fears over trade in Latin America and China became a foundation for hemispheric and global policies and an increased focus on Open Door policies.

Some of the issues discussed above reflect Chapter Three’s “The International History of the 1920’s” from Major Problems in American Foreign Relations many questions that were posed in the essay before the documents. Disarmament, isolationism, problems with Germany, Latin American issues, and economic expansionism all continued to plague the United States into the thirties and beyond. Gardner’s dedicated and detailed focus on economic measures seem to add credibility to whether or not the United States paid too much attention to economics and finance. Robert Freeman Smith’s “Republican Policy and the Pax Americana, 1921-1932” Chapter Six in From Colony To Empire denounced the Roosevelt myth of unique liberalism and like Gardner asserted a claim that earlier 1920’s tactics paved the way for New Deal policies. Thomas Ferguson’s “Industrial Conflict and the Coming of the New Deal: The Triumph of Multinational Liberalism in America” from The Rise and Fall of the New Deal Order, 1930-1980 highlighted events in a different manner and focuses on party, industry and financial considerations. The United States and its economy changed drastically in the early nineteen hundreds and effected various organizations and individuals in a myriad of ways. One curious aspect of Ferguson’s essay revealed that Thomas Lamont from the House of Morgan did not back Franklin Roosevelt in 1932. Lamont interestingly enough in Gardner’s book is assigned a financial advisor status.

Robert F. Himmelberg in his The Origins of the National Recovery Administration: Business, Government, and the Trade Association Issue, 1921 – 1933 applies more directly to Ferguson’s point of view with a description of the inception of the National Recovery Administration (NRA) that naturally encouraged an increase in influence by businessmen, party, labor, and financiers. The National Industrial Recovery Act (NIRA) and then the NRA continued previous anti-trust revision efforts aimed at institutions such as the Sherman Act. The infamous struggle between Attorney General Harry Daugherty (against price-fixing) and Herbert Hoover, Secretary of Commerce in the Harding and Coolidge administrations, eventually culminated with Hoover’s victory and free trade association regulated through various governmental departments. Statistics became the key for legal exchanges of trade information and attacked anti-trust laws. The pendulum swung back and forth between cartels and anti-cartels, but freer access to the market remained the goal. By the late 1920’s another popular revision method known as anti-trust liberalization emerged in the request for an agency to supervise cartel-like trade associations. This precursor to the NIRA and NRA is in a sense more of Herbert Hoover’s and trade associations’ efforts during the 1920’s than any accomplishment of Franklin D. Roosevelt. In any event the extreme concern displayed by Harding, Coolidge, Hoover, and Roosevelt over the status of United States Trade Associations all reflect a deep concern with the economic future of the United States, and, as Gardner maintains, Franklin Roosevelt’s revolutionary New Deal policies emerged from past United States domestic and foreign economic and political procedures.