In my drive to get things through until 1950, I realized I neglected the United States. Probably doing Chinese internal politics next, unless there's something I'm neglecting.
The Richard Russell Administration
Richard Russell started his presidency with an major challenge. First, he was clearly indebted to the Southern Dixiecrats for his victory. Second, the Dixiecrats were toxic nationally. To thread the needle, Russell focused on a preventative foreign policy, an aggressively progressive domestic policy, and strict avoidance of social issues (such as civil rights), hoping to emulate the popular presidency of Franklin Roosevelt.
Russell was first confronted with two Supreme Court vacancies after the deaths of Frank Murphy and Wiley Blount Rutledge. Eager to both burnish his anti-Communist credentials and to mollify the Dixiecrats (by depriving them one of their most prominent voices), Russell first appointed anti-Communist Senator Pat McCarran of Nevada, the chair of the judiciary committee. Of course, Russell wanted to put another Dixiecrat on the Supreme Court, so he selected Mississippi Supreme Court Justice, James P. Coleman.
Russell's ambitious domestic policy involved universal healthcare and an increase to minimum wage and social security payments. Interestingly, Russell privately torpedoed a proposal for an increase to public housing. When Congress passed the Housing Act of 1949, Russell vetoed the bill, calling it the "Negro Neighborhood Act", loathing to give the sponsor of the bill, Robert Taft, ammunition for his presidential run.[1]
Russell however, signed the Agricultural Reform Act of 1949, Charles Brannan’s plan to replace agricultural price supports with direct payments. Similarly, Russell was able to muscle a national health insurance plan, although it was greatly pared back in light of extreme opposition from business and the American Medical Association and lack of enthusiasm among the CIO, covering only basic catastrophic care and not being free-of-charge (closer to a public option).[2] Despite that, Russell went down in history as the fathers of American universal healthcare. In addition, Russell worked to pass a minimum wage increase, a social security payment increase, and tax hikes that made the American system one of the most progressive on Earth.
On foreign policy, Russell immediately shuffled the Wallace team. He was a large believer in the idea that Wallace had been too soft on the Soviet Union. In addition, he had believed Wallace to be far too harsh on the European empires, who he viewed as bulwarks against Communism. He had an excellent relationship with British Prime Minister Churchill, and largely took a policy of nonintervention towards the European empires. This also entailed not being particularly helpful to them - when Churchill asked Russell for material support in the War in Burma, Russell politely turned down the request even though it was not strictly a colonial war (Burma was already independent). Russell shuffled Forrestal back into the position of Secretary of Defense, appointing as his new Secretary of State Bernard Baruch, a respected Roosevelt-era industrialist and close friend of British PM Churchill whose anglophile foreign policy views had fallen out of favor under the Wallace administration. Unfortunately, modern archives indicate that Baruch’s Jewish heritage played a major role in inflaming Joseph Stalin’s antisemitic conspiracy theories of “Zionist traitors” in the USSR (Baruch was coincidentally also not a Zionist).
By signing the North Atlantic Treaty and condemning the surprisingly fast Soviet adoption of nuclear bombs (surprising because Americans at the time were unaware of Soviet nuclear espionage and widespread penetration of the American federal government under the Wallace Presidency.)[3] However, to indicate a slight hawkish turn in Asia, James Forrestal was shuffled into the Secretary of State position. In addition, President Russell quickly blew up in disagreement with George Marshall, who opposed Russell's generous aid program in East Asia. Marshall thought Asia was a distraction from Soviet aims in Europe, while Russell saw no reason why the United States couldn’t aid two continents at once and was keenly aware of Wallace's political fate.[4] Russell's replaced Marshall as Secretary of Defense with Dwight Eisenhower, whose approach he preferred. US troops were deployed directly in the Philippines to fight the Huk Rebels and diplomatic support offered to the Dutch.
Regardless, Russell faced grievous backlash in the 1950 Congressional elections. Organized labour was apathetic about Russell's Fair Deal, but business was outraged, with rural business particularly livid over the end of price supports.[5] Worst of all, the United States plunged into recession in 1950, partly due to a postwar drop in demand, partly due to Russell's higher, more progressive tax rates.[6] Democrats lost seats in California, Connecticut (twice!), Idaho, Illinois, Nevada, New York, Maryland, Pennsylvania, and Utah, and gained in Missouri. Notably, every Democratic Senate candidate outside of the South, excluding Warren Magnuson’s (WA) narrow 2% win, lost. Magnuson himself likely only won by being the most notable Democratic Senator to oppose Russell 's healthcare plan and agricultural reform, at the respective urging of the powerful Group Health Cooperative of Puget Sound and local eastern Washington farmers.
The day after his crushing defeat, President Russell showed no sense of contrition or humility. He was ready to fight, and fight hard. Democrats retook the House/Senate in 1948, before then losing them again in 1950. Russell saw no reason why he couldn't retake it again in 1952.
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[1] OTL, the Housing Act was the only Truman Fair Deal to pass.
[2] OTL, neither passed. ITL, much more of the Fair Deal gets passed.
[3] The Rosenbergs have uh, currently escaped notice.
[4] The biggest difference with OTL Truman in Europe is recognizing Spain early.
[5] Russell did not enjoy the temporary approval rating bump that Truman got thanks to the Korean War.
[6] The 1949 recession hits slightly later, due to no shock to American investors from the fall of China (in fact, they make a killing)