During the remainder of the 1930s, America's isolationism was most clearly defined and most ardently defended, and it reigned triumphant until fatally undermined by the very world events that had helped to promote it. The isolationism of the 1930s emanated clearly from a world situation in which the totalitarian states—most notably Germany, Japan, and Italy—challenged the status quo and with it the power position and security of the United States. Traditional American foreign policy had always rested on the assumption that the United States was safe from attack and that American trade and ideas would continue to find acceptance regardless of developments elsewhere. As that assurance diminished, it seemed more important than ever before to try and seal off the United States from threats from abroad, especially the threat of war. It was not until the end of the decade that most Americans faced up to the question then raised rhetorically by the formerly isolationist Progressive of Madison, Wisconsin: "If Hitler defeats England and the British fleet is destroyed, what becomes of our splendid isolation, with Hitler on the Atlantic side and Japan and Russia on the Pacific side?"
Until that time, the Great Depression provided a new and for a time persuasive rationale for the isolationist position. Confronted by urgent domestic problems, the immediate impulse of the United States was to turn inward and to regard events outside its borders as distractions tending to impede the solution of problems at home. Even President Franklin D. Roosevelt, who, as a disciple of Woodrow Wilson was anything but an isolationist, spurned international cooperation to alleviate the crisis in favor of unilateral American action and, in effect, torpedoed the London Economic Conference in 1933.
The depression also deflated confidence in the strength of the United States and in its ability to influence events elsewhere. Faced with evidence that much was wrong at home, many Americans abandoned the traditional belief that their institutions should serve as a model for the rest of the world. Others reasoned that the economic crisis had so sapped the nation's strength that it would be futile to intervene in international affairs. Both lines of thought led to essentially isolationist conclusions. Finally, the depression increased popular distrust of bankers and businessmen and thus the willingness to sacrifice even trade and commerce, if necessary, to maintain political and military noninvolvement. Because the reputation of the American businessman reached its nadir in the 1930s, the attempt was made to resolve the increasingly apparent dichotomy between "commerce and honest friendship with all nations" and "entangling alliances with none" not by increasing American political involvement but by circumscribing the then suspect commercial contacts.
The high-water mark of American isolationism was therefore reached in the years from 1934 to 1937, in the depth of the Great Depression. Beginning with the Johnson Act, which in 1934 prohibited loans to countries in default on previous debts—only Finland could qualify for a loan under that provision—Congress took a series of actions designed to prohibit activities of the sort that were presumed to have involved the United States in World War I. The Senate established a committee headed by the isolationist Gerald P. Nye of North Dakota to investigate the American munitions industry and its ties to European arms makers. In 1935, 1936, and 1937, by means of so-called neutrality acts, the United States banned loans and the export of arms and ammunition to countries at war, prohibited Americans from traveling on belligerent vessels, forbade the arming of American merchant ships trading with countries at war, and prohibited the sale on credit of war materials other than arms and ammunitions as well as transportation of such materials on U.S. vessels. A substantial majority of the members of Congress believed that such measures could insulate the country against increasingly threatening world events.
The rationale behind these acts provides us with the clearest expression of isolationist assumptions. Their purpose was simply to make possible in the twentieth century the stance first adopted by the United States in 1794. Although the recognition that legislation was necessary to achieve this implied an acknowledgment that the world had changed since the eighteenth century, it also suggested that the United States might accommodate itself to these changes and maintain its traditional position of neutrality by simply taking certain relatively minor precautions. This assumption required a continuing belief that the vital interests of the United States were not substantially affected by events elsewhere; that Europe still had a set of interests "which to us have none or a very remote relation"; and that the country had become involved in other international quarrels, particularly in World War I, for reasons having little to do with genuine national interest.
The last of these beliefs was given powerful support not only by the conclusions of the Nye Committee that the greed of America's "merchants of death" had led the nation into war in 1917, but also by the work of so-called revisionist historians who, at least since the appearance of Harry Elmer Barnes's The Genesis of the World War (1926), had been hammering away at the theme that the entry of the United States into the world war had been brought about, contrary to the true interests of the United States, by direct and indirect Allied pressure and by the machinations of bankers, brokers, and businessmen who had unwisely tied American prosperity to the cause of Great Britain and France. In the mid-1930s, Charles A. Beard and Charles C. Tansill were the most prominent of the historians who repeated this theme and alleged the existence of a "deadly parallel" to the situation twenty years before. Walter Millis repeated these arguments in his best-selling Road to War (1935).
The neutrality legislation of the 1930s clearly reflected the isolationist contention that the United States went to war in 1917, and might do so again, not because its interests were threatened, but merely because its activities, particularly those relating to trade, produced incidents that blurred judgment and inflamed passions. By prohibiting loans and the trade in arms, by keeping Americans off belligerent vessels, and by insisting that title to all war material had passed to the purchaser and that such material be carried only in non-American ships, the United States expected to avoid such incidents and thereby involvement in war.