Coolidge’s Silent Recipe for Success: Less Federal Government
A century ago, the American marketplace of ideas provided the people with very different options in terms of public policy. The formal institutions looked similar. The same two political parties dominated the electoral system, benefitting from entrenched regional support. The Electoral College filtered the popular vote, which reflected the people’s will through decentralized and fraud-resistant elections. Politicians, however, subscribed to different ideas. Limited government was the consensus among the political elites, who called for restrictions on government’s scope and scale. President Calvin Coolidge embodied this zeitgeist, given his reluctance to step into affairs beyond the constitutionally mandated functions of the federal government. Americans confidently elected him in 1924 by one of the biggest margins in American electoral history, after he had served for one year after President Harding’s sudden death. Silent Cal, a nickname that reflected his quiet demeanor and political restraint, empowered the American people in the interwar period.
The Roaring Twenties was a period of particular prosperity and modernization in the United States. The Coolidge Administration, whose respect of limited government created fertile soil for people to prosper in a free market, is partly responsible for the nation’s success prior to the Great Depression. This President delivered reforms that enhanced the life of Americans in many ways. He reduced taxes across the board, incentivizing productive economic activities that allowed free and enriching exchange. Coolidge challenged a tax system designed to finance America’s intervention in World War I, fostering private American entrepreneurship and saving instead. This new economic boom did not have to navigate a complex federal regulatory regime, given that this president kept the federal government largely away from free enterprise. In fact, he reduced the federal budget consistently between 1923 and 1929.
The 1924 elections also demonstrate how relevant Coolidge’s philosophy of limited government was to the positions of other parties. The president ran as a Republican, when that party embodied the demands for greater federal government in the Progressive Era after the Civil War. Simultaneously, the Democratic Party pushed for greater power to the states as a means to enforce heavy regulations, some of which had racist and segregationist undertones. Coolidge’s approach, which called for less federal government and better state and local government, dominated the Republican Party under his leadership. Radicals within his own party, led by Robert M. La Follette, left and ran a third candidacy with the Progressive Party. Americans deemed this party’s higher progressive taxes and state-owned companies as too radical to fit into the traditional two-party system,which tends to promotes moderation. On their side, Democrats reluctantly decided to run a moderate candidate in the form of John W. Davis to compete with Coolidge’s centrist and classical liberal platform. His support for policies similar to the President’s proposals meant many southerners did not even vote, yielding the worst presidential election result for this party in history. Limited government was the political consensus of 1924, playing an important role in deciding who was to become president.
A century later, the political market offers very different policies. The institutions are still the same: electoral college, decentralized election mechanics, and a two-party system where the same parties dominate, even if they have switched positions ideologically. Politicians in 2024, however, embrace a very different principle: the necessity of government intervention in private affairs. Regardless of the party or the candidates, the automatic answer seems to be bigger and, most worryingly, more invasive government. Issues like migration, labor, abortion, environmentalism, urban development, healthcare, education, transportation, safety, security, crime, investment, housing, voting rights and even citizenship are billed as having a single solution: tougher and more numerous governmental regulation, both federal and state.
The last hundred years have seen a remarkable change in political attitudes. Coolidge’s hands-off administration ended roughly three months before the Great Depression, the economic downturn that motivated the rise of the New Deal under President Franklin Delano Roosevelt. In his 14-year tenure, the longest of any American President, the federal government grew in scope and scale to manage the alleged issues generated by free markets. The response to anything that doesn’t function optimally has too often been more government, regardless of level and, overwhelmingly since the New Deal, to the benefit of politicians’ electoral prospects. Many Americans seem to approve of this development, voting for the politicians willing to “do something,” even if they make things worse. As both parties prepare to officially select their candidates at conventions this summer, the centennial of Calvin Coolidge’s only presidential election in 1924 should serve to remind Americans that less federal government and better state and local government is the governance formula behind this country’s political success. When it means restraining big and bad government, silence really can be golden.
Editor’s note: This piece originally was published by the American Institute for Economic Research.