On Pan-American Trade

The Coolidges and Ambassador Dwight W. Morrow attend the International Conference of American States, December 1928

The Coolidges and Ambassador Dwight W. Morrow attend the International Conference of American States, December 1928

The Twenties were a decade for Pan-American, or otherwise international, conferences. Coolidge took part in no less than eight during his service in Washington. The issues of international commerce, Pan-American relations, the roll back of “dollar diplomacy” and question of tariff policy revision seemed to attract him to a degree not unlike his commitment to government economy. No one can credibly argue that the Coolidge years were isolationist in outlook or activity. He took every opportunity to personally address those gatherings of private individuals who met to discuss a host of topics from standardization, sanitation, journalism, radio, highways, trade, aviation and many more concerns. As Vice President, Coolidge spoke before the Pan-American Conference of Women sponsored by the League of Women Voters in April 1922. As President he would address the First Pan American Congress of Journalists (April 8, 1926), the Third Pan American Commercial Conference (May 3, 1927), the First International Congress of Soil Science (June 13, 1927), the opening day of the International Radiotelegraph Conference (October 4, 1927), the Sixth Pan-American Conference held in Havana, Cuba (January 16, 1928), the Pan-American Conference on Arbitration and Conciliation (December 10, 1928) and the International Civil Aeronautics Conference (December 12, 1928).

When it concerned America’s connection to the sovereign nations to our south, Coolidge was there at every turn. The Fordney-McCumber Tariff signed by President Harding in 1922, sought to return a higher ad valorem rate to the tariff system, where American-made goods were protected for their value to the markets beyond merely their quantity, size, weight or other factors. The vast majority of goods on the market, no less than sixty percent, were completely free of duties. The Tariff protected American manufacturing while keeping rates low for agricultural products and raw goods. An average 14% increase in rates protected manufacturers from inferior-quality goods flooding the markets and thereby harming both the producer, who has to raise prices to meet higher costs against a cheaper, higher quantity of products, and the consumer, who is left spending more money in the end to replace inferior goods with ones that last. The protective rates, working together with both a large decrease in taxes and reduction in Federal spending, fueled the recovery that brought America out of the 1921 depression and continued (thanks to the Coolidge insistence on economy and tax cuts of 1924, 1926 and 1928) to encourage the spread of prosperity throughout all economic tiers through the rest of the decade. Rather than remaining on course, however, the next administration dismantled the delicate balance of tariff policy up for debate at the worst time. It was the discussion to raise rates even higher in 1929, leading to the passage of a new bill, the Smoot-Hawley Tariff, that unleashed an average 20% increase on dutiable imports, a 60% tax increase on over 3,000 imported products and resulted in a destructive series of retaliatory tariff increases by our trading partners around the world. Despite the firm opposition of more than 1,000 economists to the looming increases, President Hoover signed the bill into law in June 1930. While initial figures seem to indicate it was working at first, trade had collapsed and depression only deepened as a result by the spring of 1932.

Coolidges at the Pan American Conference of Women, Baltimore, April 28, 1922. Delegates from 21 nations took part in the gathering.

The Coolidges at the Pan American Conference of Women, Baltimore, April 28, 1922. Delegates from 21 nations took part in the gathering.

However, all this was in the future. As Coolidge took the podium to address the entrepreneurs and business men and women of North, Central and South America, imports in raw materials stood on mutually advantageous terms. As Coolidge will point out, this gathering was not a meeting of government bureaucrats and political operatives, it was a voluntary conference between private individuals exchanging ideas, seeking to better understand the needs, problems and market solutions of free peoples, sharing in the “civilizing influence of commerce.” It was not a forum of coercion presenting terms that benefited one at the expense of others with the aid of American money, military might or political deals. It was part of a the grander movement that “rests on the principle of mutual helpfulness,” which is free market capitalism as it naturally exists. Markets, free of state control, are not driven by Bentham’s mechanistic view of people as but utilitarian cogs in a system but rather fellow collaborators, willingly helping supply and be supplied with what each individual needs.

Coolidge commended this gathering of minds and talents from across our Hemisphere for its true merit which lay “in the fact that it represents not government but private industry.” After all, governments do not create, people engaged in commercial relationships do. “Governments do not have commercial relations. They can promote and encourage it, but it is distinctly the business of the people themselves. If this desirable activity is to grow and prosper, if it is to provide the different nations with the means of self-realization, of education, progress, and enlightenment, it must in general be the product of private initiative.” Keenly aware of the political discontent to the south coupled with a clearly harmonious relationship then existing between Pan-American suppliers and U.S. manufacturers, Coolidge continued, “Under free governments trade must be free, and to be of permanent value it ought to be independent. Under our standard we do not expect the Government to support trade; we expect trade to support the Government. An emergency or national defense may require some different treatment, but under normal conditions trade should rely on its own resources, and should therefore belong to the province of private enterprise.”

The Coolidges en route to Havana to attend the Sixth Pan American Conference, January 1928. They can be seen seated on the front row to the right on the deck of the USS Texas.

The Coolidges in worship services  en route to Havana to attend the Sixth Pan American Conference, January 1928. They can be seen seated on the front row to the right on the deck of the USS Texas.

That policy, which lifted America out of depression in 1921 and since 1913 had raised it as the foremost market for Central and South American raw goods, from wood and copper to cane sugar, coffee and food stuffs, was yielding benefits overwhelmingly in favor of our neighbors to the south. If there was any dominant partner, it was South and Central America, who held nearly all of our money in unprocessed materials. The dependence on Europe for a market had decisively changed. Now the United States was buying more in the markets of Central and South America than it was selling. The clear beneficiary was the collection of American Republics south of the Rio Grande. This was not an unsettling or harmful development, in Coolidge’s judgment. It was a definitive good and a proof that markets, allowed freedom within marginal tariff rates on a small portion of goods, are mutually advantageous to all participants. “It is our conclusion that while government should encourage international trade and provide agencies for investigating and reporting conditions, those who are actually engaged in the transaction of business must necessarily make their own contacts and establish their own markets. There is scarcely any nation that is sufficient unto itself. The convenience and necessity of one people inevitably are served by the natural resources, climatic conditions, skill, and creative power of other peoples. This is the sound basis of international trade. This diversity of production makes it possible for one country to exchange its commodities for those of another country to the mutual advantage of both. It is this element that gives stability and permanence to foreign commerce. It contributes to satisfying wants and needs, and so becomes help to all who are engaged in it.”

Vice President Coolidge entertains South American delegates to the Chile-Peru conferences then in session at Washington, June 1, 1922.

Vice President Coolidge entertains South American delegates to the Chile-Peru conferences then in session at Washington, June 1, 1922.

Coolidge did not merely praise the broad outlines of growth and commercial collaboration between the Americas, he lauded the specific directions it was taking in the development of transportation, improving the speed the travel by ship, rail, road and air. Coolidge complimented the great network of exchange not only for its material improvement but especially for its conveyance of ideas, its sharing of information, education and communication, embodied in the cable and radio, the Pan American postal agreement, the opening of roads and the clearing of new commercial horizons that resulted. In short, this meant a “more abundant life for all concerned,” not only materially but spiritually.

As he closed his remarks to these market pioneers and creative adventurers from across the Western Hemisphere, Coolidge came back to the intangible importance of what this movement meant. “It is this mutual interdependence which justifies the whole Pan American movement. it is an ardent and sincere desire to do good, one to another. Our associates in the Pan American Union all stand on an absolute equality with us. It is the often declared and established policy of this Government to use its resources not to burden them but to assist them; not control them but to cooperate with them. It is the forces of sound thinking, sound government, and sound economics which hold the only hope of real progress, real freedom, and real prosperity for the masses of the people, that need the constantly combined efforts of all the enlightened forces of society. Our first duty is to secure these results at home, but an almost equal obligation requires us to exert our moral influence to assist all peoples of the Pan American Union to provide similar agencies for themselves. Our Pan American Union is creating a new civilization in these Western Republics, representative of all that is best in the history of the Old World. We must all cooperate in its advancement through mutual helpfulness, mutual confidence, and mutual forbearance.”

Calvin Coolidge and Charles Lindbergh, November 1927. Lindbergh was virtually conscripted as an ambassador of good will to Latin America, on an even grander scale than the pilots of the Pan-American Goodwill flight of 1926. The diplomatic campaign, on the "wings" of Lindbergh's remarkable solo crossing of the Atlantic that summer, did much to advance Latin American relations. Lindbergh would also meet his future wife, Anne Morrow, as a result of his unwitting venture into diplomacy.

Calvin Coolidge and Charles Lindbergh, November 1927. Lindbergh was virtually conscripted as an ambassador of good will to Latin America, on an even grander scale than the pilots of the Pan-American Goodwill flight of 1926. The diplomatic campaign, on the “wings” of Lindbergh’s remarkable solo crossing of the Atlantic that summer, did much to advance Latin American relations. Lindbergh would also meet his future wife, Anne Morrow, as a result of his unwitting venture into diplomacy by airplane.

President Coolidge Awards First Distinguished Flying Cross Citations, May 2, 1927

President Coolidge Awards First Distinguished Flying Cross Citations, May 2, 1927

In a decade full of historic achievements in aviation, the crews of the 1926-27 Pan-Am Goodwill flights were the first to receive this award created by President Coolidge. Involving five ships across 22,000 miles in the air, these exceptional Americans delivered messages of good will, aerial collaboration and friendship to our neighbor nations in Central and South America, accomplishing what a few short years before had been decried as impossible. While there are eight aviators in this photo at Bolling Field in Washington, D.C., ten went on this important foreign relations mission. They were:

The New York – Major Herbert Dargue and Lieutenant Ennis Whitehead
The San Antonio – Captain Arthur McDaniel and Lieutenant Charles Robinson
The San Francisco – Captain Ira Eaker and Lieutenant Muir Fairchild
The Detroit – Captain Clinton Woolsey and Lieutenant John Benton
The St. Louis – Lieutenant Bernard Thompson and Lieutenant Leonard Weddington

On Factual News Reporting and a Responsible Press, Part 2

Having ventured into the ways in which the press impacts, even undermines, America’s friendly relations around the world, President Coolidge turned to the very valid reasons why America continued to be worth loyalty and admiration without compromising the press’ solemn task. He explained,

“Progress and civilization have always depended upon effort and sacrifice. We have set up our institutions, established our ideals, and adopted our social standards. We believe that they are consistent with right and truth and justice. We live under a system that guarantees the sanctity of life and liberty through public order and protects the rights of private property under the principle of due process of law. We have thrown every possible safeguard around the individual in order to protect him from any invasion of his rights even by the Government itself. It is peculiarly an American doctrine, now usually accepted in principle if not adopted in practice by all civilized countries, that these are unalienable rights, that they ought to belong to all persons everywhere, and that it is the chief function of government to provide instrumentalities by which these rights can be secured and protected. We have adopted these ideals because we believe that they are of universal application and square with the eternal principles of right. But we may as well realize that they will not continue to prevail unless we are prepared constantly to put forth great efforts and make large sacrifices for their support.”

It what could not be less timely, especially instructive with the ongoing “War on Terror,” Coolidge did not end there, but drove the point home,

“While we have not been willing to assume any general attitude of crusading toward other nations and, realizing that institutions can not be bestowed but must be adopted, have left them for the most part secure in their rights to work out their own destiny, yet we have always been willing to encourage and assist, in so far as we could in harmony with international law and custom, other people in securing for themselves the benefit of these principles and ideals. In that conflict between freedom and despotism, which is as old as humanity, and which constantly recurs on one form or another, both among ourselves and among other people, it has always been the policy of this Government to extend its sympathy and, in so far as it lawfully could, its support to the side of freedom.”

Well-established international law did not only preclude the right of America’s Government from interfering “in the purely domestic affairs of other nations in their dealings with their own citizens,” it just as strongly sustained that “certain rights over and certain duties toward our own citizens and their property” follow the American wherever one goes. The Nation bears a duty to protect both the persons and property of its citizens “wherever they may be” since “these rights go with the citizen.” This is not to say that when our people enter a foreign country, they are somehow exempt from the laws of that sovereign people. Just as our Government is obligated to uphold our own laws so are the other nations of the world, free of interjection from us. Yet, as Coolidge reminds his audience, domestic rights and duties are not mutually exclusive, they are taken together with international law recognizing rights and duties of equal potency. “There is nothing unfair, nothing imperialistic, in this principle.” Together they are accepted even between the civilized nations of our time and place because they remain, as Coolidge observed, “the only reasonable method by which enlightened humanity can safeguard friendly intercourse among the citizens of different nations.” This method, the President declared, has been forged from a belief that law must reign not upon the transient basis of borders, ethnic identity or where society is currently but upon what is universal and essential.

Discussing these great principles of law and justice in our relation to the world was supremely valuable but President Coolidge understood that placing them into practical application was just as necessary. Addressing many who knew the daunting circumstances Coolidge was about to recount, the President illustrated how the principles he had commended actually work in order for responsible media organizations, like United Press, to inform the American people with the facts. He starts by reviewing the situations in Mexico, Nicaragua and China.

At its heart, the problems in Mexico, spanning several years and involving the loss of American lives as well as the confiscation of property running into hundreds of millions of dollars, was a legal question. Mexico, adopting a constitution of its own in 1857, approved terms under which American citizens could acquire property both as individuals and as corporate owners. This remained the law until a new constitution was ratified in 1917. This newer document threatened government confiscation of those properties previously approved as lawful. Two commissioners were dispatched from the United States in 1923 who, through extensive discussion of this provision in Mexico’s constitution confirmed by signature of both President Obregon and President Coolidge that property would not be divested retroactively. Having reached so formal an understanding satisfactory to both nations “that our property rights would be respected” President Obregon’s government was grant official recognition by the United States on September 3, 1923. As efforts to overthrow the Mexican government intensified, however, in the fall of 1924, a new President claimed office who joined with the Mexican Congress to pass laws that again threatened that agreement on property ownership. The new President, Calles, refusing to recognize any prior understanding between Mexico and America, positioned to remove American citizens from their property and any right to possess it in Mexico altogether. As Coolidge summarized, “We do not question their right to take any property, provided they pay fair compensation.” Americans under the Coolidge administration sympathized with the aims of the Mexican government to return people to care of the land but at the same time recognized how the nation to our south, running too far into nationalism, was only hurting its own future. By “preventing the investment of outside capital so necessary for their development” the people of Mexico were unwittingly placing themselves at debilitating economic disadvantage, impairing “their friendly relations with other interested nations.” In effect, Mexico was telling the world it was removing itself from investment, trade and cooperation with anyone not Mexican. All the while, Mexico was also informing the rest of the civilized world that its word was not to be trusted, property could be taken without the legal safeguard of just payment and if those fundamental rights could be jettisoned, on what grounds were religious liberty, government by consent and the sanctity of life to be protected? When talk turned to arbitration, Coolidge shot it down. How could the cardinal principle that private property cannot be taken without fair compensation be up for grabs in the give and take of of the arbiter’s table? It was neither in America’s interest nor that of any other nation, to question this long-recognized right. As he would prepare to send Dwight Morrow to Mexico that summer, the President could report to this gathering of world news specialists that “the Mexican Ambassador has recently declared to me that she does not intend to confiscate our property; that she has shown diligence in capturing and punishing those who have murdered our citizens, and expressed the wish, which we so thoroughly entertain, of keeping cordial and friendly relations.”

President Coolidge had devoted a portion of his Annual Message the previous December to the problems in Nicaragua but would reiterate the key points at issue. Approached years before by the government of Nicaragua to dispatch a force of our Marines to that country, the United States had helped restore peaceful conditions for some twelve years. Nearly as soon as withdrawing the Marines, however, Coolidge saw revolution break out again. In the midst of violent upheaval, the Nicaraguan Congress confirmed a a National Executive and the U.S. joined by Nicaragua’s Central American neighbor-nations recognized the new President as having “constitutional title” to the office. As time elapsed, it quickly became evident that the new government was not protecting “American lives and property” so Coolidge sent in the Marines a second time. In the process of fighting for peace, a misinformation war was simultaneously underway. President Coolidge was disappointed to see cartoonists depicting the conflict as a squabble over oil even despite the verifiable fact that Nicaragua had no oil to develop let alone over which to fight.

Deviating from his point briefly, Coolidge sought to correct this irrational prejudice against oil consumption as an inherent evil. He said, “Our country consumes vast quantities of oil and gasoline in its use of automobiles, gas engines, and oil-burning furnaces. If these products are to be kept within a reasonable price, which is very important to a great body of our citizens, our people who go abroad to develop new fields and to increase the supply ought to have the encouragement and support of our Government.”

Returning to a discussion of the facts on Nicaragua, the President retorted, “We are not making war on Nicaragua any more than a policeman on the street is making war on passers-by. We are there to protect our citizens and their property from being destroyed by war and to lend every encouragement we can to the restoration of peace. While the destruction of life and property has been serious enough had it not been for the presence of our forces it would undoubtedly have been much worse.” The President noted the irony of those who had eagerly insisted there was ample mandate for American involvement in “far-off countries in Asia, where we have no interest that does not attach to all humanity” while our involvement, principally employing “the peaceful method of elections” in Central and South America, found those same people shrinking back with hesitation and criticism. When it came to the unique moral responsibility the United States had for those countries to our south, those same people found fault with “attempting to encourage the maintenance of order, the continuity of duly established government, and the protection of lives and property of our own citizens under a general reign of law in these countries…near at hand…where we have large and peculiar interests.”

Finally, the President moved to the volatile set of issues surrounding China. Undergoing revolution, the country had been segmented into numerous parts, “each claiming to represent a government, none of which we have recognized,” Coolidge affirmed. “Our main difficulty here is the protection of the life and property of our citizens.” Most of these lives and properties were missionaries, a few commercial enterprises and their possessions. America was not holding Chinese property. During the Coolidge administration, the mission of our Navy and Marines was one of concentrating our citizens in the port cities where they could be protected and transported to safety. We were not there to impose seize land or impose our ways on others. It was during these tenuous efforts to protect American citizens and their possessions that one of them was murdered, another was wounded and our consulate ransacked at Nanking. Coolidge explained what happened next, when “the house in which our people had taken refuge was surrounded and they were actually under fire it became necessary for one of our ships…to lay down a barrage” in order to drive away the soldiers and mob so that our citizens could reach “a place of safety on our ships in the river.” President Coolidge outlined why the United States deployed forces again when, just weeks prior to this address, the warring elements in China refused to grant America’s request to avoid fighting in the designated foreign sections of Shanghai. Having the most genuine sympathy for a restoration of freedom, unity and even the voluntary establishment of republican government to China, Coolidge realized that the internal upheaval can “be let loose temporarily beyond their power to control” which is why the United States continues a presence there to uphold the duty of protecting American nationals. America was not there to display aggression but “to prevent aggression against our people by any of their disorderly elements.” Coolidge retained an optimism for China’s eventual reclamation of its obligations. “Ultimately the turmoil will quiet down and some form of authority will emerge, which will no doubt be prepared to make adequate settlement for any wrongs we have suffered. We shall of course maintain the dignity of our Government and insist upon proper respect being extended to our authority. But our actions will at all times be those of a friend solicitous for the well-being of the Chinese people.”

America had inescapably stepped into the position of a world power. Attendant with that immense moral authority is the unavoidable criticisms which must be borne. While others have marched across the globe, using their leadership for conquest and subjugation, it will be assumed (falsely) that America will follow suit. “Such, however,” Coolidge emphasized, “is not the spirit of the American people.” We should expect that baseless accusations of imperialistic motives will be thrown against us, even when legitimately engaged in the support of international law, upholding our national interests and protecting the rights of our citizens. Holding ourselves “up to high standards of justice and equity…[w]e should be slow to take offense and quick to grant redress.” Civilization moves forward by the “acceptance and general observance of definite rules of human conduct.” The press functions in the indispensable role of both an advocate and expositor of America’s dutiful positions and “unwavering faith in those principles” not only to those at home but to the rest of the world. While America’s attitude to every nation remained one of “friendship and good will,” those who cast aside the rule of law “can not hope for our approbation.” America does not reward the lawless and violent. Those who struggle to rise in the pursuit of what Coolidge calls “a larger liberty,” America has abundant forbearance. America is to stand by the requirements of what is right and just but also ready to show generous mercy and compassion. To accomplish these obligations, however, America must be united and constantly prepared to serve. A free and responsible press helps furnish, through reliable reporting of the facts, a renewing commitment to America’s ideals by a truly informed citizenry.