"The chief business of the American people is business."
-- President Calvin Coolidge, 1925
To the American public of 1914, the outbreak of war in Europe came as a shock. At first the encounter seemed remote, but its economic and political effects were swift and deep. By 1915 U.S. industry, which had been mildly depressed, was prospering again with munitions orders from the Western Allies. Both sides used propaganda to arouse the public passions of Americans -- a third of whom were foreign-born or had one or two foreign-born parents. Moreover, Britain and Germany both acted against U.S. shipping on the high seas, bringing sharp protests from President Woodrow Wilson. But the disputes between the United States and Germany grew increasingly ominous.
In February 1915, German military leaders announced that they would attack all merchant shipping on the waters around the British Isles. President Wilson warned that the United States would not forsake its traditional right, as a neutral, to trade on the high seas -- a view of neutral rights not shared by Germany or Great Britain. Wilson declared that the nation would hold Germany to "strict accountability" for the loss of American vessels or lives. Soon afterward, in the spring of 1915, when the British liner Lusitania was sunk with nearly 1,200 people aboard, 128 of them Americans, indignation reached a fever pitch.
Anxious to avoid a possible declaration of war by the United States, Germany issued orders to its submarine commanders to give warning to ocean-going vessels -- even if they flew the enemy flag -- before firing on them. But on August 19, these orders were ignored and the British steamer Arabic was sunk without warning. In March 1916, the Germans torpedoed the French ship Sussex, injuring several Americans. President Wilson issued an ultimatum stating that unless Germany abandoned its present methods of submarine warfare, the United States would sever relations. Germany agreed.
As a result, Wilson was able to win reelection that year, partly on the strength of his party's slogan: "He kept us out of war." As late as January 1917, in a speech before the Senate, Wilson called for a "peace without victory," which, he said, was the only kind of peace that could last.