Morgenthau, Henry T., Jr.

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MORGENTHAU, HENRY T., JR.

Henry T. Morgenthau, Jr., (May 11, 1891–February 6, 1967) was secretary of the treasury from 1934 to 1945 under presidents Franklin D. Roosevelt and (briefly) Harry S. Truman. Morgenthau's father was from a German-Jewish family that immigrated to the United States in 1865. Henry Morgenthau, Sr., amassed a considerable fortune through investment in real-estate properties in the New York City boroughs of the Bronx and Harlem. He and his wife, Josephine Sykes, were activists in the Democratic Party and in social welfare causes, including the Henry Street settlement, the Bronx House, and fire safety conditions in New York City. Henry Morgenthau, Sr., also served as head of finance for the Democratic National Committee in 1912 and again in 1916, and as ambassador to Turkey during World War I

Henry Morgenthau, Jr. was born in New York City, the third and only son of four children. He entered Phillips Exeter Academy in New Hampshire in 1904 but did not do well, completing his college preparation at the Sachs Collegiate Institute in New York City. In 1909 he enrolled at Cornell University to study architecture, but completed only two years. His father then found him work at various jobs, including volunteer service with Lillian D. Wald at the Henry Street Settlement.

In 1911 Morgenthau contracted typhoid fever and went to Texas to recuperate. Life in rural Texas convinced him that he wanted to build a career as a gentleman farmer, even if that meant defying his father's wish that he take up the family businesses. After another brief stint at Cornell, and a tour of farming districts throughout the United States, he returned to New York, where he acquired some 1,700 acres in Dutchess County, New York. There, at age twenty-two, he began a career in agriculture, working hard to make his largely depleted lands along the Hudson River productive and profitable. During World War I he accepted a largely honorary commission as a naval lieutenant, and after the war helped Herbert Hoover's U.S. Food Administration provide tractors to French farmers.

By 1915 Morgenthau had met a neighbor, Franklin Roosevelt, who unsuccessfully urged him to get involved in politics. Their common Democratic Party and humanitarian interests nonetheless helped in forging a close relationship, the younger Morgenthau becoming intensely loyal and devoted to Roosevelt and eager to promote his friend's political career. In 1916 Morgenthau married a childhood friend, Elinor Fatman, a highly able and accomplished graduate of nearby Vassar College. Elinor Morgenthau and Eleanor Roosevelt also formed a close friendship, working together in various welfare and educational activities.

In 1922 Morgenthau purchased a failing journal, the American Agriculturalist. Through the journal he became known as a leading advocate of progressive scientific farming. It thus was almost predictable that when Roosevelt was elected governor of New York in 1928 he named Morgenthau chairman of the Agricultural Advisory Committee, asking him in addition to work at strengthening the Democratic Party in the economically depressed rural areas of the state. In 1930 Roosevelt moved Morgenthau to the post of conservation commissioner for the state. There Morgenthau worked closely with Harry L. Hopkins, helping to establish a state reforestation project that created employment for thousands of men and served as a model for the popular New Deal Civilian Conservation Corps.

Morgenthau was deeply disappointed in 1933 when the newly-elected President Roosevelt did not appoint him secretary of agriculture. He nonetheless accepted a post as head of the Federal Farm Board. In November the illness of William Woodin led Roosevelt to appoint Morgenthau acting secretary of the treasury. Within a few months it was clear that Woodin could not return and Morgenthau became secretary. He continued as secretary of the treasury for the next eleven years, longer than any of his predecessors except Andrew Mellon.

Morgenthau led the Department of the Treasury through perhaps the most turbulent era since the Civil War, that of the Great Depression and World War II. He had unparalleled access to the president, the two taking lunch together each Monday. His was a major voice in encouraging the president to devalue the dollar in late 1933 and early 1934, a policy recommended by the inflationist monetary theories of Cornell agricultural economists George F. Warren and Frank A. Pearson.

Well-schooled in progressivism, the secretary of the treasury was devoted to efficiency and economy in government. He saw a balanced federal budget as the best indicator of success in both and took upon himself the task of accomplishing it. Early in 1937 the economic indices were suggesting that the recovery was solid, and Morgenthau began plans for balancing the budget. That fall, however, the economy took a serious plunge. Morgenthau responded by insisting even more strongly that the budget be balanced, now not as a happy consequence of, but as an instrument of, recovery. When Roosevelt ignored him and took the advice of Harry Hopkins and Federal Reserve Chairman Marriner S. Eccles to renew spending in April 1938, Morgenthau threatened to resign.

World War II involved the Department of the Treasury continuously in key issues. Morgenthau opposed the relocation of West Coast Japanese Americans in 1941. He was an early advocate of American aid to the allies, and helped to establish the War Refugee Board to assist Jews and other refugees from Europe. Most controversial, however, was his Morgenthau Plan for dealing with postwar Germany. The secretary proposed the complete demilitarization of Germany, the dismantling of its industries, and its division into two agricultural states. The plan was opposed by President Truman and others, whose argument that a strong postwar Germany was needed for stability in Europe carried the day. Morgenthau was a key participant in the Bretton Woods Conference of July 1944, which led to the establishment of the International Monetary Fund and the World Bank.

Finding that Truman opposed the Morgenthau Plan, and resentful that the president did not invite him to attend the Potsdam Conference, Morgenthau resigned in July 1945, returning to his farm in Dutchess County. After his wife Elinor died in 1949, he married Margaret Puthon Hirsch. In retirement he devoted much of his time to philanthropies, directing the United Jewish Appeal between 1947 and 1950, and chairing the board of governors of the American Financial and Development Corporation for Israel from 1951 to 1954. He died in Poughkeepsie, New York, in 1967.