Tuesday, September 3, 2013

Coolidge by Amity Shlaes

I have been waiting for Coolidge by Amity Shlaes since I first heard she was writing it. She came to my attention when I read the definitive history of the New Deal in The Forgotten Man. She states that in researching for that book, she realized she was missing the part of the story that involved Coolidge. She has single-handedly resurrected him from a forgotten president to the highly respected place he so deserves. 

She begins with this pithy synopsis of the life of Calvin Coolidge, “... to an improbable extent, the chapters of Coolidge’s life after childhood are chapters of near failure upon near failure. Coolidge almost didn’t leave the village, almost didn’t make it at college, almost didn’t get a job, almost didn’t find a wife, almost disappointed as a state senator, almost stumbled as Massachusetts governor, almost failed to win a place on the Republican presidential ticket in 1920, and almost failed in Washington once he arrived there as vice president in 1921. As president, Coolidge almost failed to win the backing of his party, almost gave into grief after the sudden death of his sixteen-year-old son, Calvin, Jr. Almost capitulated to a recalcitrant Congress and unruly foreign leaders.” But he did not fail. He succeeded by continuously heeding the call of service and delivering more than was expected. 

In the same staccato style, Shlaes details Coolidge’s many successes, “Under Coolidge, the federal debt fell, Under Coolidge the top income tax rate came down by half... Under Coolidge the federal budget was always in surplus. Under Coolidge, unemployment was 5 percent or even 3 percent. Under Coolidge, Americans wired their home for electricity and bought their first cars or household appliances on credit. Under Coolidge, the economy grew strongly, even as the federal government shrank. Under Coolidge, the rates of patent applications and patents granted increased dramatically... Under Coolidge, a man from a town without a railroad station, Americans moved from the road into the air.” In short, Coolidge kept government out of the way and America blossomed economically.

Coolidge is rightfully known as Silent Cal. After leaving the small isolated village where he grew up for college, he made very little impression. His grades were mediocre, but after being rejected by every fraternity on the campus of Amherst, he came under the sway of a powerful and charismatic Professor Garmin. He made life-long friends at the college, however, and came into his own in a powerful senior speech revealing a side of Calvin his classmates had never seen. They were “impressed by the humor, quiet dignity and penetrating philosophy” he radiated. After college, he skipped law school preferring the old method of “reading law,” literally, as an intern in a law office. Once he passed the bar, even sooner than expected, he struggled as a small-time country lawyer, but was respected for his lack of fee-raising loquaciousness. 

He entered his first political contest right away, following in his father’s footsteps, when he ran for a seat on the Northampton City Council. Shortly thereafter, he accomplished his final goal, to find a wife. He met Grace Goodhue, a teacher at a local school for the deaf who lived just across from him. It was thought that someone who taught the deaf, might be able to conjure Calvin to speak. Their marriage was a perfect partnership of like-minded people.

Coolidge’s political career continued to take off. He won a seat in the lower house of the state legislature in Massachusetts. He was frustrated at being away from his wife and did not enjoy the legislative process, so he next occupied the position of mayor of Northampton. The executive position suited him better. At this time, his staunchly Republican political views began to take on a flavor unique to Calvin. He began to come into his own politically and even counseled his father, a newly elected state senator, “It is much more important to kill bad bills than to pass good ones.” Soon the mayor’s job was no longer big enough and he ran to join his father in the state senate. And, although he considered himself a progressive, he chafed when the most famous Progressive, Teddy Roosevelt, pushed for the Republican nomination over that of the incumbent Republican, Taft. In fact his third-party run led to the subsequent victory of the Democrat, Wilson.

He began to really gain the attention of the Republican party when he led a senate committee to negotiate a strike by the IWW or Wobblies as they came to be known. The Progressives had passed laws designed to help the workers, shorter hours, etc., but which then led to reduced pay. Striking in radical and violent ways to restore their lost wages, Coolidge the Progressive, had to make a choice. He saw how the Progressive policies hurt the workers, yet he saw the same workers being violent and disruptive. He had to choose sides. His law and order sense came through and he successfully negotiated an end to the strike. This success led to the eventual role as president of the state senate, which he followed by running for lieutenant governor and then governor of Massachusetts. 

He gained national attention in his role of Governor when the police of Boston went out on an illegal strike. The city was paralyzed and the mayor, police commissioner and Coolidge jockeyed for position as to who was best to handle the situation. Coolidge poured over the state constitution, eventually finding the authority. In a bold move that took everyone by surprise, he neither capitulated nor compromised. He fired the striking police and made sure they could never return to work as a policeman. His bold law and order stance garnered praise from around the country. He had even upstaged Wilson who had vacillated on the strike. Some began to think of Coolidge in presidential terms. Coolidge seemed to represent the “Silent Majority” of normal, middle-of-the-road folks.

But Coolidge, with his evolving political philosophy did not feel quite ready for the Presidency. He forcefully shut down those who would push for him. Despite this, his backers worked behind the scenes at the next Republican convention to get him nominated as Vice President. He found himself second on a ticket he had not sought out, under Warren Harding. Harding, with his call for a “Return to Normalcy” resonated with Coolidge and they made a good pair. Harding helped solidify Coolidge’s changing beliefs about Progressivism when he stated, “No altered system will work a miracle. Any wild experiment will only add to the confusion. Our best assurance lies in efficient administration of our proven system.” He advocated not the Square Deal of TR nor the constant innovation of Wilson, but a return to the Old Deal.

Harding began reining in the government after the large deficits ran up in the Wilson administration with his programs and WWI. Yet he surrounded himself with crony’s and soon his administration became the subject of various scandals. When Harding died suddenly, Coolidge moved into the top spot determined to finish what Harding had started. Where Harding made moves to cut, Coolidge actually did. His first official act was to notify all departments that their budgets would have to fall. He intended to cut $300 million from the federal budget and began to meet with his budget director General Lord, at least weekly. He also met regularly with his Treasury Secretary, Andrew Mellon, and discussed Mellon’s idea of “scientific taxation.” Mellon believed in the radical notion that high tax rates could actually bring in lower tax revenues than lower tax rates. Finally converted, Coolidge worked on both cutting spending and lowering taxes to increase revenue. But his real passion remained the cutting end of the budget. He feared large increases in revenue would result in more calls for spending and undo all his hard work. The success of his policies led to a successful run for President in his own right in 1924.

All throughout his subsequent term, he battled a congress intent on undoing what he worked hourly to do. After his tax plans passed and revenues began to rise, Coolidge would see the debt fall by a third and the government operate with a surplus. Yet true to his predictions, Congress wanted to spend the extra revenue. Coolidge constantly battled to veto the spending bills they passed, knowing they would only grow the government more and add to the debt he worked so hard to decrease. Despite his popularity and assurance of a second term in 1928, the battles took their toll on both his health and his marriage. In typical Silent Cal style, he notified the press and the Republican party of his intentions with a simple note stating, “I do not choose to run for President in nineteen twenty eight.”

Sadly, Coolidge knew that the Roaring 20s he had helped usher in was due for a correction. Having worked with his apparent successor Herbert Hoover, Coolidge felt certain all that he had accomplished would be swept away when the inevitable downturn came. He told his Secret Service agent, “Well, they’re going to elect that superman Hoover, and he’s going to have some trouble. He’s going to have to spend money. But he won’t spend enough. Then the Democrats will come in and they’ll spend money like water. But they don’t know anything about money.” What a prescient man. He foresaw exactly what was to come and did in fact happen. Had the nation followed his lead of not interfering with the economic downturn and continued to keep spending and taxes low, who knows? We may have avoided the Great Depression altogether. Instead, Hoover began to meddle, and resorted to that old Republican standby, the tariff, thereby ushering in worldwide retaliation. FDR followed and outdid the meddlesome Hoover by orders of magnitude. We are still paying for his experimentation today. 

Coolidge lived to see his prediction come true. Hoover panicked with the crash of 1929, spent more money than he should have, implemented wage and price controls, and still lost to a Democrat. Once again, Coolidge revealed his prophetic powers by believing that despite his rhetoric, Roosevelt would engage in more spending and more experimentation. The country and it’s leaders no longer held to Harding’s admonition against such things. 

Coolidge died of a heart attack in 1932. The WSJ wrote, “in due time, the good fortune of the United States to have had such a man as Calvin Coolidge in just the years he filled that office will be more clearly realized than it has yet been.” Hopefully we are beginning to realize the genius of this misunderstood President. Hopefully we will soon elect another one as committed to getting our financial house in order.

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