34. Paul McNutt

Dan Carden

dan.carden@nwi.com, (317) 637-9078

Gov. Paul McNutt

34th governor of Indiana; Democrat

Served: Jan. 9, 1933-Jan. 11, 1937

Born: July 19, 1891; Franklin, Ind.

Hometown: Martinsville

Profession: Lawyer

Died: Mar. 24, 1955 (age 63); buried in Washington, D.C.

Other offices held: U.S. High Commissioner to the Philippines, 1937-39, 1945-46; U.S. Federal Security Agency director, 1940-42; U.S. War Manpower Commission, 1942-44; U.S. Ambassador to the Philippines, 1946-47

Accomplishments: Just as the nation elected Democrat Franklin Roosevelt president in 1932, so too did Hoosiers decide to combat the ongoing Great Depression by ending nearly two decades of Republican control of the governor's office.

McNutt, a popular Indiana University law school professor and national commander of the American Legion, helped in this regard, campaigning ceaselessly for Democrats (and eventually himself) for two full years prior to the election. He focused the race on tax reform and economy in government, and insisted the only way to end the Depression was to get rid of every Republican officeholder.

He nearly succeeded, with Democrats in 1932 winning the governor's office, all 12 of Indiana's congressional seats, a U.S. Senate seat and margins of 43-7 in the state Senate and 91-9 in the House.

Taking an expansive view of the role of governor, McNutt reorganized the executive branch, consolidating 168 state agencies and commissions into eight departments; claimed the power to appoint any non-elected state employee; and centralized control in the governor's office. He enacted the state's first income tax and imposed a gross receipts tax on businesses, which helped turn a $3.4 million state deficit into a $17 million surplus.

McNutt reduced the power of utility companies by establishing an office of the consumer advocate (initially future U.S. Supreme Court Justice Sherman Minton) to fight for lower rates. He also effectively implemented national New Deal relief programs in Indiana, providing work to jobless Hoosiers and hope for those struggling for years during the Depression.

McNutt's patronage powers did raise eyebrows as state employees were essentially required to belong to the governor's "Two Percent Club," and kick back 2 percent of their wages to the Indiana Democratic Party. Following the 1933 repeal of Prohibition, McNutt also saw to it that loyal Democrats got the limited number of beer distributor licenses.

In 1935, McNutt's willingness to call out the National Guard to quell labor strikes earned him the nickname "Hoosier Hitler."

McNutt considered challenging Roosevelt for president in 1936. He was dissuaded after Roosevelt appointed him High Commissioner for the Philippines, where he helped Jewish refugees find homes after they were rejected for entry to the United States.

In 1940, McNutt was sure it was his time to be president, but Roosevelt's successful bid for a third term derailed his ambitions once again. During World War II, McNutt served in a variety of federal posts.

President Harry Truman sent McNutt back as the first U.S. ambassador to the Philippines in 1946 after the island nation regained its sovereignty following the war.

McNutt later worked as lawyer in New York City and Washington, D.C. He is buried in Arlington National Cemetery.

Financial Affairs Reporter

Dan has reported on Indiana state government for The Times since 2009. He also covers casinos, campaigns and corruption.