Excellent article by Amity Shlaes setting right incorrect assumptions and economic falsehoods regurgitated by the new Gatsby film.
Milt Rosenberg talks with Amity Shlaes about Coolidge h e r e
A new study on presidential greatness revisits some of the ground that has been covered in this blog. While authors David Henderson and Zachary Gochenour use data that have been utilized before, most prominently by Dean K. Simonton, they add the new variable of American lives lost during a president’s tenure. The main finding is that this variable is a strong predictor of presidential greatness – as ranked by historians. I’ll report in more detail, especially as I take issue with some of the older variables, but here is a telling excerpt that features our own favorite president:
(…) historians do tend to think a president is greater if, all other things equal, he has made “tough” decisions. Tough decisions often involve getting the United States into costly wars or, if other countries’ governments have initiated, not avoiding wars. Consider, for example, the following quote from law professor John O. McGinnis: “To be sure, Coolidge was not a truly great president, like Washington or Lincoln. While he successfully handled small foreign policy crises in China, Mexico, and Nicaragua without saddling the United States with permanent and expensive commitments, he was never tested by a substantial foreign war.”
McGinnis is a law professor, not an historian, but the tone of these remarks is similar to that of many historians. McGinnis judges Coolidge negatively because he was never “tested” by substantial foreign wars, rather than positively for having kept the United States out of major wars. McGinnis and many historians commit the mistake highlighted by 19th century economic journalist Frederic Bastiat of not paying attention to “what is not seen.” In this case the unseen is the wars that various presidents could have inserted the United States into but didn’t. Or, to take an analogy, when a president avoids war, it is like the clue in the Sherlock Holmes story, “Silver Blaze:” the clue was that the dog didn’t bark. It takes a clever man like Holmes to realize that the dog’s not barking is what’s important. It takes an historian different from the usual to realize that a president’s decisions that helped make a war not happen are also evidence of leadership and greatness.
As Zachary Karabell, biographer of president Chester A. Arthur has written: “Presidents who govern during a time of calm and prosperity often suffer the barbs of history. They are remembered as bland.” This indeed troubling. As the authors of the new study conclude:
Most presidents, after all, probably want to be thought of as great. When they spend resources on war, they are spending almost entirely other people’s money – and lives. They get little credit for avoiding war. Martin van Buren, for example, effectively avoided a war on the northern border of the United States. How many people know that today? Indeed, how many people have even heard of Martin van Buren? (…) We should stop celebrating, and try to stop historians from celebrating, presidents who made unnecessary wars. One way to do so is to remember the unseen: the war that didn’t happen, the war that was avoided, and the peace and prosperity that resulted.
If we applied this standard, then presidents Martin van Buren, John Tyler, Warren G. Harding, and Calvin Coolidge, to name four, would get a substantially higher rating than they are usually given.
On January 28, 1929 – just a few weeks before leaving the White House – Calvin Coolidge spoke at the 16th and, as it turned out, last meeting of the Business Organization of the Government. Looking back on 8 years of reining in a government structure “permeated with extravagance”, the president listed the stunning accomplishments, chief among them the unprecedented reduction in the national debt and the concurrent tax reductions. Beyond mere statistics, the speech clearly shows that this project was Coolidge’s major opus, the cornerstone of what he wanted to accomplish in office and what he intended to leave as his legacy. Yes, it must have rankled sometimes to be accused by some of “considering nothing but the material side of life” or charged with “advocating a penurious and cheeseparing policy.” But ultimately, having inserted “a golden page in our history,” this least war-like of presidents was justified in stating that “peace hath its victories no less than war.”
Characteristically, Coolidge cautions near the end of his speech that “the margin between prosperity and depression is very small,” urging continued vigilance against extravagance and waste. Not very much later, that depression really was at hand, and Coolidge’s successors chose to follow policies much different from his. Today, economists and historians debate whether their frantic actions, resulting in a huge expansion of government rather than “constructive economy”, prolonged and worsened rather than shortened the Great Depression. Be that as it may, Coolidge himself later stated that he felt out of touch with these new policies. It is poignant to me to note how proud he must have felt at the time of giving this speech, and how devastating it must have been later, when this proudest of his achievements was dragged down by the Great Depression and indeed his own policies were blamed as causes of the economic downturn.
Well, this time I’m getting an early start! Eighty years ago tomorrow, Calvin Coolidge wrote his daily “Calvin Coolidge Says” column about a subject near and dear to his heart, and also somewhat pertinent to our day and age – taxation:
The Congress has before it two distinct problems which in their solution conflict with each other. One is the necessity of providing revenue to meet obligations already incurred, or any new commitments for relief. The other is to do what it can to encourage business. The obligations must be met. But that requires taxes and perhaps more taxes. That will retard business. The answer may lie in temporary borrowing to meet temporary emergency. The danger there is extravagance.
It would seem perfectly clear that business will not be improved by spending tax money. Taxes are already too high. With all the national reductions, states and municipalities have raised taxes until the grand total is about $13,000,000,000.
Nothing would so encourage business than a reduction of this local and national burden. In 1921 it was particularly the drastic cuts in Federal expenses and taxes that brought economic revival.
While relief must be provided, those who now advocate higher taxes may be meeting the Treasury requirements but are postponing prosperity. Those who seek to improve our economic position by spending more tax money are going in the wrong direction. Rigid governmental economy would finally solve both problems.
Interestingly for those who now approvingly quote Coolidge (or Mellon) policies, it is clearly apparent that Coolidge was not of the “deficits don’t matter” school. As Joe Thorndike has only recently pointed out, Coolidge was for tax reduction when accompanied by rigid government economy, and certainly not in favor of extravagant borrowing – I’m positive he would be aghast at today’s levels of national indebtedness.