After the end of World War I and the global rise of the Soviet revolutionary imagery, several terrorist attacks occurred in the United States, presumably attributable to the more left-wing fringes of anarchist movements. The death toll from these attacks exceeded 35, and the number of serious injuries exceeded two hundred, leading to widespread public distrust of any form of thought within the socialist and Marxist world. These events were further fueled by theories that American communists had direct contact with the ruling bodies of the now-dissolved German Reich, given their guilt in reintroducing Lenin to Russia after bringing him out of exile in Switzerland. Americans feared becoming the second target of a phantom global revolutionary plot.

This widespread condemnation of communist ideas in the United States was not limited to popular sentiment, and the government soon began implementing repressive measures against them. This task was entrusted to General Palmer. The military man began organising and promoting a policy of widespread, and in most cases unwarranted, arrests of members of the two American communist parties. After the autumn of 1919, members of European immigrant associations, especially workers and members of left-wing political fringes, who were very present in the American social fabric, suffered massive forced repatriation and expulsion. As a result, CPUSA and CLP membership dropped by 80%, including those arrested—including prominent figures Gitlow and Ruthenberg—those who destroyed their party membership cards out of fear of the police, and those expelled from party leadership for suspected collusion with law enforcement.

Those who remained within the communist ranks after government persecution were the most committed and extremist individuals, who had clearly grasped the ultimate revolutionary goal. However, by 1920, fear of possible revolutionary action had diminished, both due to the mitigation of the international climate and the U.S. Department of Labour's condemnation of Palmer's unwarranted repressive actions. In this regard, in 1921, President Harding allowed the release of almost all those arrested for political reasons in previous years.