The Failure Of The Teapot Dome Scandal

The Teapot Dome scandal, which is also called the Elk Hills scandal or the Oil Reserves scandal, was a scandal that involved big oil companies, national security, bribery and corruption in the Harding administration. There was also corruption at the highest levels of the government of the United States. Teapot Dome was named that because it was near a rock formation that looked like a teapot.
In 1912, William Taft designates the oil reserves in Elk Hills, California for the Navy. In 1915, Woodrow Wilson designates the oil deposits in Teapot Dome, Wyoming for the Navy. The oil fields in Teapot Dome, Wyoming and Elk Hills, California, were Naval Petroleum Reserves that were to only be drilled in a national emergency and would guarantee that

the Navy would have enough oil during war. Naval warships have recently been converted from coal power to oil power.
On 4 March 1921, Warren G.

Harding become the President of the United States. He surrounded himself with a group of old friends known as the Ohio Gang by appointing them to his cabinet. Albert B. Fall, one of Harding’s friends, was appointed to his cabinet as the Secretary of the Interior. Another friend, Edwin Denby, was appointed to his cabinet as the Secretary of the Navy.
Soon after Fall was appointed Secretary of the Interior, he was able to convince Harding and Denby to allow transfer of the Naval Petroleum Reserves to the Department of the Interior. Fall told Harding that his department will be better able to oversee the protection of the oil fields and will be still kept for national emergencies.
Fall made secret deals between two friends, Edward Doheny and Harry Sinclair, who were both in the oil industry. Edward Doheny was the owner of Pan American Western Petroleum Company and Harry Sinclair was the founder of Sinclair Oil.
Fall had received personal “loans” of over $400,000 to lease land from the Teapot Dome and Elk Hills oil reserves. He also granted an oil lease to Sinclair Oil in Teapot Dome without any competitive bidding. Fall then received a “gift” of $100,000 from Edward Doheny to obtain a lease of 32,000 acres of government oil fields in Elk

Hills.
By 1923, rumors of corruption in the Harding Administration and in the Ohio Gang began to surface.
On 2 August 1923, Warren Harding unexpectedly dies of a heart attack in San Francisco’s Palace Hotel and Calvin Coolidge, Vice President, takes over in office.
In 1923, a Senate investigations was opened by Senate Thomas J.

Walsh of Montana. The investigation reveals that Fall had received more than $400,000 in “loans” for assisting Sinclair and Doheny. The Federal District Court of Wyoming help the lease valid, but was revered by the Circuit Court and was upheld by the Supreme Court later that year on October 27.
On 2 January 1923, Edwin Denby, Secretary of the Navy and Albert Hall, Secretary of the Interior, were forced to resign.
As the investigation continues, they discovered that one of Sinclair’s companies had transferred $233,000 in liberty bonds to Fall’s son-in-law. The investigation by the Senate also connected that the Teapot Dome and Elk Hills leases were fraudulent and corrupt. Any leases associated with the Teapot Dome scandal were cancelled in 1927.
In 1927, Sinclair was imprisoned for six and a half months for contempt of court and contempt of the U.S. Senate in the District of Columbia jail. The oil fields were also restored to the U.S. Government by a Supreme Court decision.
Two years later, Fall was convicted of bribery and was fined $100,000. He was also imprisoned for one year, where he served nine months of the one year sentence. Fall is now known for being the first cabinet officer to be jailed for crimes committed in

office.
In 1930, one year later, Edward Doheny was charged with bribing Fall, but was acquitted.
It is unknown wether Harding knew about the scandal, but he ultimately started the problem. He surrounded himself with his old friends from the Ohio Gang and appointed them to his cabinet. Not only was that his mistake, he also did monitor them.
The Teapot Dome was regarded as the “greatest and most sensational scandal int eh history of American politics” and remained so until the Watergate Scandal.