by Robert Sobel
As was his custom, Coolidge ended with a peroration right out of his early mentor, Garman.
America is not and must not be a country without ideals. They are useless if they are only visionary; they are only valuable if they are practical. A nation can not dwell constantly on the mountain tops. It has to be replenished, and sustained through the ceaseless toil of the less inspiring valleys. But its face ought always to be turned upward, its vision ought to be fixed on high.
The Pepper–McFadden Bill passed, which Coolidge gladly signed, as he did the radio legislation he had requested.
Coolidge had not presented a legislative agenda. From the beginning his most important task that session, other than taxes, appeared to be to prevent passage of McNary–Haugen. The new Congress was more inclined toward it than the old had been, and it had new allies. From the outside there was Lowden, a recent convert, and within the administration Vice President Dawes had come over to the cause. Senator Curtis was weakening, and within the cabinet his only strong supporter was Mellon. A revised McNary–Haugen Bill was introduced soon after Coolidge’s address, passed the House easily, and the Senate by a smaller margin, but Coolidge promptly vetoed it.
Unlike most of his vetoes, this one was surprisingly forceful and closely reasoned. Carefully and precisely, Coolidge picked it apart. He noted that the measure discriminated against farmers who did not concentrate on the favored crops; those who did would be aided “at the expense of the farmer who has toiled for years to build up a constructive farming enterprise to include a variety of crops and livestock that shall, so far as possible, be safe, and keep the soil, the farmer’s chief asset, fertile and productive.” Coolidge asserted that the middlemen would be the real beneficiaries. “It seems almost incredible that the producers of hogs, corn, wheat, rice, tobacco, and cotton should be offered a scheme of legislative relief in which the only persons who are guaranteed a profit are the exporters, packers, millers, cotton spinners, and other processors.” As for the Federal Farm Board, which was to administer the law, “A board of twelve men are [sic] granted almost unlimited control of the agricultural industry and can not only fix the price which the producers of five commodities shall receive for their goods, but can also fix the price which the consumers of the country shall pay for these commodities.” In his view, “the effect of this plan will be continually to stimulate American production and to pile up increasing surpluses beyond the world demand.”
Coolidge hit hard at the idea of special relief for one segment of the population at the expense of others. “This so-called equalization fee is not a tax for purposes of revenue in the accepted sense. It is a tax for the special benefit of particular groups.” This, arguably, was precisely the intent and effect of the tariff that Coolidge supported. The tariff, of course, protected farmers as well as businessmen and industrial workers, but still, each item on the list protected one or another special interest. Throughout, however, Coolidge stressed that one of the major reasons for tariffs was to raise revenues, and he justified his stance on this point. In his annual address Coolidge had noted with satisfaction that receipts exceeded $615 million in 1926.
The bill returned to Congress, which was unable to overturn the veto. As before, its supporters worked diligently to overcome congressional objections and win new converts. Another version was passed in 1928, and again Coolidge vetoed in unusually strong language; “It embodies a formidable array of perils for agriculture which are all the more menacing because of their being obscured in a maze of ponderously futile bureaucratic paraphernalia. In fact, in spite of the inclusion in this measure of some constructive steps proposed by the administration, it renews most of the more vicious devices which appeared in the bill that was vetoed last year.”
Coolidge offered a “detailed analysis” of his objections to the measure, including (1) its attempted price-fixing fallacy; (2) the tax characteristics of the equalization fee; (3) the widespread bureaucracy it would set up; (4) how it would encourage profiteering and wasteful distribution by middlemen; (5) its stimulation of overproduction; and (6) its aid to our foreign agricultural competitors.
In his conclusion, Coolidge complained that “this taxation or fee would not be for the purposes of revenue in the accepted sense but would simply yield a subsidy for the special benefit of particular groups of processors and exporters…. It would be difficult to conceive of a more flagrant case of the employment of all of the coercive powers of the government for the profit of a small number of specially privileged groups.” He spoke of a “bureaucracy gone mad” and a “preposterous economic and commercial fallacy.”
Had Coolidge unleashed this flash of temperament in the cause of other items on his original agenda, his legislative record might have been more productive. The question remains: Why was Coolidge so heated in his denunciation of McNary–Haugen? He felt strongly about the importance of tax cuts, but his messages on that subject were calculated, almost bloodless. Not so with government assistance to farmers.
These two positions are the centerpiece of Coolidge economics—and are at the very core of his philosophy. The president believed that lower taxes and reduced government spending would result in a freer, more democratic society. He hoped to return the country to a version of what it had been before passage of the Income Tax Amendment, a time of small—and primarily local—government. Thus, he considered McNary–Haugen even more threatening to freedom than the existing tax structure. To Coolidge, McNary–Haugen was a radical change in the relation between government and the people, between economics and government. Coolidge believed these two elements should be separated: Government should remain out of the economy, and businessmen should not interfere with the proper functions of government. He articulated this thought, at the foundation of his philosophy, in several of his presidential speeches. In “Government and Business,” a speech delivered before the New York Chamber of Commerce on November 19, 1925, he said:New York is an imperial city, but it is not a seat of government. The empire over which it rules is not political, but commercial. The great cities of the ancient world were the seats of both government and industrial power. The Middle Ages furnished a few exceptions. The great capitals of former times were not only seats of government but they actually governed. In the modern world government is inclined to be merely a tenant of the city. Political life and industrial life flow side by side, but practically separated from each other. When we contemplate the enormous power, autocratic and uncontrolled, which would have been created by joining the authority of government with the influence of business, we can better appreciate the wisdom of the fathers in their wise dispensation which made Washington the political center of the country and left New York to develop into its business center. They wrought mightily for freedom.
Coolidge believed that the wedding of government and business would lead to socialism, communism, or fascism, and would certainly alter the nature of American life. Yet Coolidge saw no difficulties in government aid to commercial aviation, grants for road building, or the protective tariff, once known as “Mother of the Trusts.” It was a common enough thought of the time, shared by moderate Democrats and Republicans alike. Herbert Hoover certainly believed this; writing in his Memoirs about Secretary of Agriculture Henry C. Wallace, who supported McNary–Haugen, Hoover said, “My colleague, the secretary of agriculture, was in truth a fascist, but did not know it, when he proposed his price- and distribution-fixing legislation in the McNary–Haugen bill.”
Supporters of McNary–Haugen were not so much throwbacks to the progressives or populists as antecedents to the New Dealers. They believed, quite simply, that the government had a responsibility for the economy—in Coolidge’s terms, that Washington and New York had to come together, under Washington’s aegis. If agricultural recovery depended on direct government intervention, so be it.
But the times were against the McNary–Haugen advocates. This, as well as deep flaws in the program and divisions among farmers as to the measure’s desirabil
ity, lost them their fight. The attempt to override the veto failed in the Senate by a vote of 50 to 31. The idea, however, did not die; it would be reintroduced during the Hoover administration, and again fail. Agricultural reform dependent on government input would not be realized until the Great Depression and the New Deal—when the times were strikingly different, and farmers were united in its support.
Congress adjourned for the spring and summer on March 3, 1927, and the country’s interests turned to other matters. This was the summer that Babe Ruth hit his 60 home runs, and the Yankees took the American League pennant by winning 110 games and losing 44, for a winning percentage of .714, a level as yet unsurpassed. In September Gene Tunney defeated Jack Dempsey in a fight noted for “the long count.” It was also the year of The Jazz Singer, generally credited with being the first feature sound film.
The greatest sensation of the time was Charles A. Lindbergh’s May 20–21 flight from Roosevelt Field on Long Island to Paris. It would be difficult to find a more striking contrast than Coolidge and Lindbergh—one embodying the ethos of a vanished America, the other the world of the future. Yet these two were not so dissimilar. Both men were shy and diffident, believers in individualism, and considered pure and clean in a world that was becoming more corrupt. Coolidge, however, was the real thing. The modest, self-effacing Lindbergh was as prepared to cash in on his exploits as any modern hero. He permitted his name to be used, for around $6,000 a pop. (“I was able to carry very few things in my Spirit of St. Louis, but I took special care not to forget my Waterman pen.”) After Coolidge left the White House, a cosmetics company approached him, offering a large sum to get Grace Coolidge to endorse its product; Mr. Coolidge turned the company down—his wife simply didn’t use that product.
Coolidge arranged for Lindbergh’s return on the cruiser USS Memphis, and a flotilla of destroyers, two army airships, and forty airplanes greeted the ship and escorted it into New York harbor. There Lindbergh met cabinet members and other dignitaries, and was treated to the biggest parade in the city’s history to that time. Lindbergh and his mother then went to Washington to stay with the Coolidges at the temporary White House (the official residence was undergoing repairs), and at a dinner Dwight Morrow introduced the aviator to his daughter, Anne—who later became Mrs. Charles Lindbergh. Songs were written about him, babies named after him, and a dance was titled in his honor. On Wall Street the aircraft stocks soared, with Wright Aeronautical leading the way, rising 500 percent. The Dow-Jones Industrials closed over 200 by year’s end, a new record. The country forgot McNary–Haugen, arguments for and against tax cuts, and all else in an outburst of national pride and affection for the young man. In the “feel good” atmosphere of the time, some of the glory was reflected on Coolidge. It was, for many in retrospect, the high noon of the decade.
In his December 6, 1927, annual message, which opened with, “It is gratifying to report that for the fourth consecutive year the state of the union in general is good,” Coolidge reviewed his previous tax reductions. In the face of an economic slowdown, he asked for changes that were “mainly for the purpose of removing inequalities.” In many ways it was a repeat of the 1926 report—he wanted to sell Muscle Shoals, opposed large scale naval expansion, and wanted more attention paid the merchant marine. As for agriculture, he wanted funds to help create marketing cooperatives, but without governmental input.
This is not a proposal to lend more money to the farmer, who is already fairly well financed, but to lend money temporarily to experimental marketing associations which will no doubt ultimately be financed by the regularly established banks, as were the temporary operations of the War Finance Corporation. Cooperative marketing especially would be provided with means of buying or building physical properties.
Coolidge again had kind words to say about the negro and alluded to the lynchings in the South. “The Congress should enact any legislation it can under the Constitution to provide for its elimination.” But he would go no further, and did not press for such a bill. To the negro he now added the American Indian, and spoke of the time “when the Indians may become self-sustaining.” But here, too, he took no action.
On May 8, 1928, Coolidge had complained to reporters about the costs of some of the programs Congress had passed, even those of which he approved.
I am a good deal disturbed at the number of proposals that are being made for the expenditure of money. The number and the amount is becoming appalling. Practically none of these bills have reached me yet, and it may be that the Congress won’t pass all of them. Of course, there is this flood bill. It is impossible to estimate what that will cost. If it is carried out as suggested, I think $500,000,000 would probably be the minimum. Nobody knows what the maximum might be. There is this farm bill calling for $400,000,000. The Boulder Dam bill. I think the lowest estimates on that are $125,000,000. Other estimates run to $250,000,000. There is a pension bill, running $15,000,000 or $20,000,000. The salary bill, the so-called Welch bill, of about $18,000,000. The Muscle Shoals bill, which I think was reported to me would cost perhaps $75,000,000. I think that is rather excessive. That is only a part of them. I don’t know just what will happen to the Treasury if we try to put all those proposals into effect.
At the time Coolidge was devoting more time and energy to the relatively minor tax reduction measure than any other. It was as though this was the capstone of his tax program. Congress was compliant, and a few days later passed much of the Coolidge program. The corporate tax was reduced, and graduations in the individual tax rates made less progressive. But Congress denied Coolidge the elimination of the estate tax. He signed the measure into law anyway, reflecting that his work on the matter at least was completed. In July the president crowed that the surplus for the fiscal year came in at $398 million. It was the conclusion of a very good session as far as he was concerned.
12
Foreign Relations
The presidency is primarily an executive office. It is placed at the apex of our system of government. It is a place of last resort to which all questions are brought that others have not been able to answer. The ideal way for it to function is to assign to the various positions men of sufficient ability so that they can solve all the problems that arise under their jurisdiction.
The Autobiography of Calvin Coolidge
WHEN HE ARRIVED IN OFFICE, Coolidge had almost no interest in foreign relations and left matters in this sphere to his secretaries of state and the diplomats. Former Secretary of State Elihu Root—a leading Republican foreign policy expert whom Coolidge called on for assistance—once remarked, the president “did not have an internationalist hair in his head.” This was not so, for as will be seen, Coolidge had a clear concept of America’s role in the world, and the ways the president could contribute toward it.
Still, Coolidge arrived in the presidency without experience in foreign affairs, although his library included works on America’s possessions and the tariff. He came to office with less preparation to handle matters of foreign policy than any of his presidential predecessors in the twentieth century, except McKinley. Harding had been on the Foreign Relations Committee; Wilson knew Europe from his many prior visits there; Taft had been secretary of war, had been abroad, and had been prominent in the creation of the Panama Canal; and Theodore Roosevelt had traveled extensively in Europe, had served as assistant secretary of the navy, and had led the “Rough Riders” in the Spanish–American War.
In this period an ignorance of foreign affairs was not considered a drawback. While the World War and the Spanish–American War had widened the vista for literate Americans, few had been overseas, and public interest remained centered on American problems. Lack of experience hadn’t troubled earlier presidents, who tended to rely on foreign policy specialists for information and advice, and that was a practice that suited Calvin Coolidge.
Several threads ran through the fabric of Coolidge’s foreign policy, but they tended to be dominated by business considerations. Co
olidge believed the wartime debts owed the United States by the Allies had to be paid. Still, he was willing to make concessions regarding interest rates and terms. His reasoning was that if foreigners didn’t pay their debts, someone—and that meant the American people—would have to do so. Coolidge could not accept this notion. “Every dollar that we have advanced to these countries they have promised to repay with interest,” he told a gathering during Memorial Day in 1926. “Our National Treasury is not in the banking business. We did not make these loans as a banking enterprise.”
In response to a suggestion that the United States might forgive the foreign debt, Coolidge was supposed to have said, “They hired the money, didn’t they?” In fact, he never said that, though he might have thought that. Mrs. Coolidge once remarked that it sounded like her husband. What he did say, however, was, “Unless money that is borrowed is repaid, credit cannot be secured in time of necessity.” In other words, deadbeats have low credit ratings.
