Amity Shlaes
writes history and biography that connect to economics. I had already read her detailed
book on "the Great Society" and her excellent book on "the New
Deal". She's always thorough and insightful. Her
2013 biography of Calvin Coolidge will provide too much information for many readers. But
for those who enjoy economic history, her work is helpful and interesting. I'd
already read and reviewed Garland Tucker's
book on the 1924 election. With the 100th anniversary of Coolidge's inauguration as our 30th
president on August 2nd, I wanted to read and write about his noteworthy
presidency.
Along the way,
Shlaes shares some cool little details: Coolidge's great-grandfather paid $31
in 1842 for preferred seating on a pew at church (14). The middle name of
Coolidge's grandfather was Galusha after a two-term governor of Vermont. At one
point, Galusha was paid to cut off the ear and brand a C on the forehead of a
criminal (probably for counterfeiting). The Coolidge family had a recipe for
"Scripture cake" with 12 ingredients based on a variety of Bible
verses (15-16). And the nature of telegraph messages is that they tended to be
abrupt and abrasive: saving money with shorter sentences; all capital letters;
"stop" instead of periods for punctuation (171).
It was a
different time in many ways. Coolidge's 16-year-old son died from a freakish
blister infection that would have been easily treated today. The federal government
was much smaller then. Spending is 90 times greater today, even
controlling for inflation (which they didn't have in the six years when
Coolidge was president). But some things were the same—e.g., interest group
politics (burgeoning at the time) and concerns about federal government
spending and debt (their problems were largely from World War I). Technological
advance was also impressive. Suburbs and skyscrapers made their debut. Movies
added sound. Cars and phones became prevalent. Lindbergh flew across the
Atlantic. And Coolidge lit the first national Christmas tree using electricity.
Why has
Coolidge continued under the radar of history? In terms of
"substance" and public policy, he was a "minimalist
president" and opposed the growth of government—not to mention dramatic
expansions of the State. He thought it was more important to kill bad bills
than to pass good ones. Acts of omission are typically harder to value compared
to acts of commission, especially with government where the benefits of
activism are typically obvious while its costs are subtle.
In terms of
style, Coolidge didn't have a big personality; some presidents have drawn
attention to themselves through charismatic personality. He doesn't get any
credit from being associated with Mount Rushmore which started when he was
president. (He advocated that Teddy Roosevelt should join Lincoln, Jefferson
and Washington.) "Silent Cal" was a quiet man who was famously terse.
But quality trumped quantity; he meant what he said and said what he meant. He
was the last president to write his own speeches. He was the first president to
make heavy use of radio. And Larry Reed notes that Coolidge still holds the
record for presidential news conferences—one every five days in office.
(Wouldn’t it be nice to have a president who talks less and speaks to the press
more?)
Unfortunately, presidential
historians often rate Coolidge (well) below-average. But aside
from statist ideology and an ignorance of economics, there is no reason to
consider him anything less than above-average. In fact, the most compelling
claim about him is that Ronald Reagan was our best president since at least
Coolidge.
Shlaes sees
this as a shame and compares Coolidge favorably to other presidents. Like John Adams,
he served as Vice President and saw the office as insignificant on its own
merits. Like Adams and Washington, he was uncomfortable with high society. Like
Washington (and others before FDR), he refused a third term. Like Lincoln, he
lost a son while president—and frustrated advisors with his thoughtfulness on
policy, but acted decisively when he moved. Like Teddy Roosevelt, he ended a
period of rank corruption. Like Wilson, he favored international diplomacy.
Like Harding, he valued consistency and predictability in policy. And so
on.
But the closest
comparisons are Grover Cleveland and Ronald Reagan. (In fact, Reagan replaced
Truman's portrait in the White House with Coolidge's.) All three held a
minimalist view of the federal government. (Reagan worked with a bipartisan
Congress and inherited a much larger government that could not easily be
reduced to earlier standards.)
Coolidge and
Cleveland both vetoed tiny expenditures on items that are amazing by today's
norms: flood victims and farm subsidies. In both cases, they did not see the
expenditures as an ethical or constitutional role for the federal government. When
should the government take money from X to give to someone else? (Coolidge did
support some tariffs and farm subsidies, although he famously vetoed the
McNary-Haugen farm bill twice.) The extent to which his administration pored
over the budget to save money is impossible to imagine now: the Weather Bureau
not sending out postcards with forecasts anymore; post office bags switching
from red, white, and blue to gray; and white string instead of red tape (yes,
red tape!) to wrap documents (323).
Coolidge and
Reagan both embraced the reality of "supply side economics" and its
relevance in contexts where high marginal tax rates were impeding the
economy—and ironically, squelching tax revenues. The theory describes
the supply-side impact of cuts in tax rates: encouraging
"supply" in the economy through greater work effort,
entrepreneurship, and innovation, as well as reducing tax avoidance and tax
evasion. (Tax cuts also have "demand-side" implications that are more
famous: more money in our pockets results in greater investment and especially
consumption.) Andrew Mellon called this "scientific taxation" in his
efforts to increase tax revenues. Coolidge and Mellon worked with a Republican
Congress to cut the top marginal tax rates from 73% to 25%. Reagan worked with
a strongly-Democratic House to reduce the top rate from 70% to 28%.
Amazingly,
federal government spending was about the same (about $3 billion) when Coolidge
left office in 1929. In this, he was emulating the fiscal conservatism of
Harding who reduced spending dramatically (from WWI levels). The economy boomed
throughout his administration. "If Coolidge was a Scrooge, he was a
Scrooge who begat plenty." (6) The increased revenues from decreased tax
rates resulted in budget surpluses every year—and the federal debt
was reduced by more than 20% (from $22.3 billion to $17.6 billion). This data
also contradicts the tenets of Keynesianism that began to dominate for 50
years, starting with Hoover and then FDR. (Today, if we froze federal spending,
we could have a balanced budget within a decade and would be far more likely to
avert a debt crisis.)
Ironically, the
budget surpluses led to calls for increased government spending. Along with
Coolidge's lame-duck status (in 1927, he announced he would not run for another
term), Congress began to press for more expenditures in a manner that would
soon manifest as much larger government under the big-spending
social-engineering of Hoover and FDR. (Spending doubled under Hoover and the
role of government exploded under FDR's "New Deal.")
Coolidge and
Reagan both took controversial stands to confront powerful public-sector
unions. In August 1981, President Reagan fired the air traffic controllers who
went on strike, while Governor Coolidge fired the Boston police in 1919 for
striking. In both cases, compromises were available but not chosen. To
Coolidge, these were not strikers but deserters. His conclusion: "There is
nothing to arbitrate...nothing to compromise...there are no conditions under
which the men can return to the force...[There is] no right to strike against
the public safety by anyone, anywhere, anytime." (167, 174) Wow! In both
cases, the interest group complained, but the public was supportive, especially
in the context of the Russian Revolution for Coolidge and a tough economy for
Reagan. With his response to the strike, Coolidge became a key national
political figure, leading to his election as Vice President in 1921.
In some ways,
the 1924 presidential race was one of the most interesting in American history—with
two Conservatives (Coolidge and the Democrat John Davis) and one Progressive
(Senator Bob La Follette). This campaign and its context are the subject of
Garland Tucker's fine book, The High Tide of
Conservatism. (My
review of it is here.) Conservatism
had been successful under Coolidge. And most of the nation was tired of
Progressivism after Wilson (including a really tough economy in 1919-20, with
unemployment up to 20% and GDP down by 1/6th).
Still, there
were enough voters to warrant a Progressive candidate. (La Follette earned 16%
of the vote; won his home state; and finished second in 11 others.) But the
Dems thought it wiser to also go with a conservative. Davis described himself
as a "classical liberal" and later opposed both FDR and his "New
Deal". In 1924, not surprisingly, Coolidge won easily: 54-29% over Davis in
the popular vote and 72% of the electoral vote. (Some of the statewide numbers
are amazing: Davis won 97% in South Carolina, but less than 10% in five states,
including California.)
Coolidge was
born on July 4th and as president, gave the commencement address at all-black
Howard University in 1924. He handled the scandals of his predecessor with
integrity and consistency, defending the office of the presidency with strong
but modest leadership. The economy was strong throughout his administration. He
didn't have much international or domestic drama to address. So, the standard
opportunities for presidential greatness were not available to him—as they were
to Reagan with the Cold War, the worst economy since the Great Depression, and
the "malaise" of the Carter years. Still, Coolidge was a fine
president by any objective standard—and arguably, one of our best. Let's make
sure to celebrate his centennial on August 2nd.
