Contrast Coolidge’s remarks with today’s attitudes from and toward presidents, senators, and congressmen. Americans have been primed to disappointing heights to expect greatness from their political leaders. But let me tell you, you will learn more, a lot more from the folks in your immediate neighborhood than you ever will from any president, black, white, woman, or whatever. This statement by Jeff Deist nails it:
All I can say in closing is that unfortunately today we insist on electing and running megalomaniacs, especially in presidents. We want people to solve climate change and Syria and Ukraine, stock markets and monetary policy and there are no humans equipped to do that. God knows we could use a quiet competent administrator these days.
1929 Stock market crash happened under Hoover and acted more like a democrat than a republican as far as his response to the crash. He believed in “easing.” He believed in spending to stimulate, he believed in pushing wages upward in a downturn so the worker will spend to stimulate the economy. He believed in regulating Wall Street and chastising it in a downturn. These are not concepts that Coolidge would have agreed with or understood.
Coolidge had homespun wisdom on money. “Inflation is repudiation.”
[15:37] The inflation after WWI took them all by surprise. Coolidge had observed what the policy was in the downturn in the early 20s, perceiving that downturn and fearing it, the government raised interest rates and cut the government, meaning itself, in half. That’s not what we do today. That terrible downturn of the early 20s went away pretty fast and it’s the “Forgotten Depression.” Jim Grant even wrote a book called that. So take from that what lessons you will. In our conversation, Coolidge would not have spoken of inflation so much as of “credit.” That’s the way they thought of it: credit from banks. Too much credit in the marketplace, too little credit. And there’s some merit in that as well. He didn’t know that much about the Federal Reserve, the new entity. No one knew what the Fed might do or could do. This was just the beginning of what we tend to think about open market operations.
DEIST [16:43] There was no dual mandate. The Fed was a different thing back then.
[17:09] Monetary policy was a new thing back in the 1920s.
Fortney-McCumber under Coolidge. Smoot-Hawley Tariff Act under Hoover.
His beauty was that he cut taxes dramatically, multiple times, in the face of opposition. Bringing the top marginal rate after many battles down to 25%. That’s below Ronald Reagan. The rate had been over 50% even though the income tax was young in the 20s. it was already a powerful tool and the Treasury recognized that. So with great effort, Coolidge cut the tax back
And oppositions in his own party. Remember the Republicans were the progressives. And he gets a lot of points for that. He waged war to lower taxes the way other presidents waged war abroad.
Followed by strong prosperity. 1920s reform of Coolidge. Statistics of income online. Gov’t made more money back received more revenues than expected. Supply-siders can find evidence for their position. FDR had to be a hero and Coolidge went down.
The 1930s, presidents were ranked. The ranking is your sum. Can’t have two tops. You’re forced to make a choice. Coolidge’s success being better than FDR is that acknowledging that Coolidge’s arguments have merit against FDR’s policies is disquieting to people who want an active government. [23:19]
FDR was popular because he had a 1st class temperament, lovable, and led our country in a war that most Americans believed was necessary and he did that well. If a president is a war hero and stopped the Nazis, yo0u’re going to forgive his economics. FDRs economics wasn’t so awesome.
Forgotten Man is a revision. The book is taught all over the country. The Great Society is also serious revision.
Economics and the Public Welfare, Benjamin Anderson, 1980.
When people force companies to raise wages, will they force people to hire fewer?
“It’s useful for the American people, even a safeguard, to know that their president is not a great man, that he comes from the people and returns to the people.” Very different attitude from today, republican or democrat.
Went back to their house in Vermont. Coolidge was popular.
All I can say in closing is that unfortunately today we insist on electing and running megalomaniacs, especially in presidents. We want people to solve climate change and Syria and Ukraine, stock markets and monetary policy and there are no humans equipped to that. God knows we could use a quiet competent administrator these days.
Author of 4 New York Times Best Sellers
Chair, Calvin Coolidge Presidential Foundation
Presidential Scholar, The King’s College, New York
AmityShlaes.com. She’s written several books, one of which is Coolidge, Amity Shlaes, 2014.
The Forgotten Man: A History of the Great Depression, Amity Shlaes, 2008. Her book has been attacked. This book of hers is taught all over the country. It was a serious revision and her current book, due out in the November of this year, is The Great Society: A New History of the 1960s in America, 2018.