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Soviet espionage and McCarthyism

In August 1948, Whittaker Chambers, a former spy for the Soviets and a senior editor at Time magazine, testified before the House Un-American Activities Committee (HUAC). He said an underground communist network had worked inside the U.S. government during the 1930s, of which Chambers had been a member, along with Alger Hiss, until recently a senior State Department official. Chambers did not allege any spying during the Truman presidency. Although Hiss denied the allegations, he was convicted in January 1950 for perjury for denials under oath.

The Soviet Union's success in exploding an atomic weapon in 1949 and the fall of the nationalist Chinese the same year led many Americans to conclude subversion by Soviet spies was responsible and to demand that communists be rooted out from the government and other places of influence. Hoping to contain these fears, Truman began a "loyalty program" with Executive Order 9835 in 1947. However, Truman got himself into deeper trouble when he called the Hiss trial a "red herring". Wisconsin Senator Joseph McCarthy accused the State Department of harboring communists and rode the controversy to political fame, leading to the Second Red Scare, also known as McCarthyism. McCarthy's stifling accusations made it difficult to speak out against him. This led Truman to call McCarthy "the greatest asset the Kremlin has" by "torpedo the bipartisan foreign policy of the United States."

Charges that Soviet agents had infiltrated the government were believed by 78 percent of the people in 1946 and became a major campaign issue for Eisenhower in 1952. Truman was reluctant to take a more radical stance, because he felt it could threaten civil liberties and add to a potential hysteria. At the same time, he felt political pressure to indicate a strong national security. It is unclear to what extent President Truman was briefed of the Venona intercepts, which discovered widespread evidence of Soviet espionage on the atom bomb project and afterward. Truman continued his own loyalty program for some time while believing the issue of communist espionage was overstated. In 1949, Truman described American communist leaders, whom his administration was prosecuting, as "traitors". Truman would later state in private conversations with friends that his creation of a loyalty program had been a "terrible" mistake.

In 1950, Truman vetoed the McCarran Internal Security Act, which was passed by Congress just after the start of the Korean War and was aimed at controlling communists in America. Truman called the Act, "the greatest danger to freedom of speech, press, and assembly since the Alien and Sedition Laws of 1798," a "mockery of the Bill of Rights" and a "long step toward totalitarianism". His veto was immediately overridden by Congress and the Act became law. In the mid-1960s, parts of the Act were found to be unconstitutional by the United States Supreme Court.