Tea Pot Dome Scandal for APUSH

Tea Pot Dome Scandal for APUSH2019-02-21T17:39:29+00:00

Tea Pot Dome Scandal

About the Author: Johnny Roy has been an Advanced Placement US History teacher for the past 8 years at Cuyahoga Heights High School just outside of Cleveland, Ohio. He has been actively involved with the AP Reading as a grader for the past 3 years having scored the DBQ, LEQ, and SAQ sections of the exam.

Tea Pot Dome Scandal

The Tea Pot Dome Scandal was one of the most extreme examples of government corruption in United States history. The issue revolved around oil rich lands at Tea Pot Dome, Wyoming and Elk Hills California that had been set aside by the government for use by the U.S. Navy as emergency reserves.

The Tea Pot Dome Scandal was one of the most extreme examples of government corruption in United States history.

As a member of President Warren G. Harding’s administration as Secretary of the Interior, Albert Fall arranged to have these lands transferred from the Navy to the Department of the Interior. Then in 1922, Fall leased out these lands to private oil companies for an assortment of loans, bonds, and cash.

Warren G. Harding’s administration as Secretary of the Interior, Albert Fall leased public lands to private oil companies for an assortment of loans, bonds, and cash.

After a lengthy Senate and Special Counsel led investigation, Fall would be found guilty in 1929 of accepting bribes and was fined $100,000 dollars and sentenced to one year in prison.

Importance of Oil

During the 2nd Industrial Revolution, John D. Rockefeller had built up a massively powerful oil empire in the United States. His company was known as Standard Oil and at the height of his industrial might, Rockefeller’s company was responsible for more than 90% of all oil refining in the country. This gave Rockefeller tremendous power and wealth which he used to influence politicians, bully competing businesses (railroad and steel companies), and position himself as one of the most powerful men in the world.

However, due to public outcry of unfair labor and business practices and with the legislative backing of the Sherman Anti-Trust Act, Standard Oil would be broken up into 34 subsidiary companies in 1911. This left many companies and executives now competing for new and existing oil deposits around the country.

The Sherman Anti-Trust Act, broke Standard Oil into 34 subsidiary companies in 1911. This left many companies and executives now competing for new and existing oil deposits around the country.

The Navy Needs to Improve

As technology continued to improve, the U.S. Navy continued to update and modernize its forces. This required the conversion of older coal-fueled ships into the more powerful and efficient oil-powered ones. In order to ensure the viability of these ships and having enough fuel for them to operate, the government began to set aside federal lands believed to have oil deposits on them in case of an emergency.

In order to ensure the oil availability of the new oil-fueled ships, the government began to set aside federal lands believed to have oil deposits on them in case of an emergency.

Some of these lands included Tea Pot Dome, Wyoming and Elk Hills, California. These lands would fall under the control of the US Navy. Yet, President Harding would later transfer them to the Department of the Interior at the request of his Secretary of the Interior, Albert Fall. Fall was a member of the so-called Ohio Gang, a group of Harding’s poker playing and drinking buddies from his days as a Senator from Ohio whom he had appointed to high level government positions.

President Harding, known to be a womanizer and to enjoy a drink or two, was also known as a good natured and social man. Yet, he was also a fairly naïve politician that had rode the wave of oil and other special interest money to the presidency without really understanding all of the complex issues that a president has to deal with. Unfortunately, he relied on people that were more intent on making themselves powerful and wealthy through graft, rather than doing what was in the best interests of the country or the president.

Harding relied on people that were more intent on making themselves powerful and wealthy through graft, rather than doing what was in the best interests of the country or the president.

Oil for Money

Presidential cabinet secretaries wield tremendous power and influence within the federal government. Unfortunately for him, President Harding had made the mistake of choosing dishonorable people to fill those positions. Harding filled those positions with people whom he thought he could trust, but they simply were looking out for themselves.

Harding gave these cabinet positions to friends and old political allies from Ohio and they spent quite a bit of time drinking, smoking, and playing poker with the president. Harding famously has been quoted saying, “I have no trouble with my enemies. I can take care of my enemies in a fight. But my friends, my goddamned friends, they’re the ones who keep me walking the floor at nights!”.

These “advisers” used their influence to convince Harding to approve various questionable things.  One of those advisers was Secretary Fall, who was able to convince the president to approve the transfer of the oil rich lands from naval oversight to that of the Department of the Interior as well as the eventual leases that allowed the private oil companies to take advantage of the oil deposits.

Following the transfer of control of the oil rich lands to his department, Fall began secret negotiations with several wealthy friends from the oil industry.

Before becoming Secretary of the Interior, Albert Fall was a powerful Senator and businessman from Ohio who frequently used his positions to enrich himself and his associates. Following the transfer of control of the oil rich lands to his department, Fall began secret negotiations with several wealthy friends from the oil industry.

Then in 1922, without any competitive bidding process or public announcements, Fall leased exclusive drilling rights to Tea Pot Dome to Mammoth Oil Company, a company owned by longtime friend Harry Sinclair. Fall then leased the federal land in California to another old friend Edward Doheny, the owner of the Pan-American Petroleum Company.

In return for securing the leases for the oil companies, Fall would receive a $100,000-dollar interest free “loan” from Doheny that was used to purchase land for a ranch in New Mexico. Fall would also receive hundreds of thousands of dollars in liberty bonds and a large herd of cattle to his newly purchased ranch.

In return for securing the leases for the oil companies, Fall would receive a $100,000-dollar interest free “loan” from Doheny that was used to purchase land for a ranch in New Mexico.

By April of 1922, whispers of a backroom deal were beginning to make their way around Wyoming surrounding activity at Tea Pot Dome. This resulted in an investigation by the Senate into any potential wrongdoing by the Harding Administration.

The Death of a President and a Criminal Investigation

In June of 1923, before any investigations had started, President Harding decided to take a cross-country tour of the United States, including a trip to Alaska, which no other US President had done before. However, in August of the same year, the president began to suffer from shortness of breath and cramps in his chest. President Harding later died in San Francisco, California on August 2, 1923 from what appeared to be complications from a heart attack.

President Harding later died in San Francisco, California on August 2, 1923 from what appeared to be complications from a heart attack.

After the death of Harding, Vice-President Calvin Coolidge became President. Once the Senate investigation reached the point that more information was needed, Coolidge instructed 2 special counsels to take control of the investigation into Secretary Fall’s oil dealings.

With the loss of his political cover in President Harding, it was quickly discovered that Fall had indeed engaged in illegal activity. Fall received cash, bonds, and other gifts in return for preferential treatment in the bidding process (which was secret and not open to everyone) for leasing rights to the oil rich lands in Wyoming and California. Fall would be found guilty of accepting bribes and sentenced to one year in prison and fined $100,000 dollars. In 1929, Secretary fall would become the first cabinet officer in American history to be sent to prison for committing crimes while in office.

With the loss of his political cover in President Harding, it was quickly discovered that Fall had indeed engaged in illegal activity. Fall received cash, bonds, and other gifts in return for preferential treatment.

The Aftermath of a Scandal

President Calvin Coolidge was effectively the opposite of Warren Harding. Coolidge was quiet and subdued where Harding was boisterous and social. Coolidge also believed in rooting out the corruption that had crept its way into the Harding administration through the Ohio Gang.

Attorney General Harry Daugherty was forced to resign after his own shady business dealings came to light regarding improper payments for political influence were discovered. Coolidge worked to distance himself from the corruption of the Harding administration and get back to his basic governing principles of reducing government influence on industry and businesses as much as possible. His economic policies and philosophies of laissez-faire economics would help set the stage for the economic growth that occurred throughout the 1920s.

Coolidge worked to distance himself from the corruption of the Harding administration and get back to his basic governing principles of reducing government influence on industry and businesses as much as possible.

Historically, the Tea Pot Dome scandal has been widely regarded as the worst case of corruption in a presidential administration and was unmatched until the Watergate Investigations under President Richard Nixon in the 1970s.