Silent Cal
Vice President Calvin Coolidge was awakened in the middle of the night at his father’s rustic home in Plymouth, Vermont, to the news that he was now president of the United States. He took the oath of office by the light of a kerosene lamp, with his father presiding as notary.
When he was vice president, the press liked to joke that Coolidge was "silent in sixteen languages." He had a reputation as a stoic New Englander with Puritan morals and a solid integrity. In short, he was just what the country needed after Harding’s freewheeling, scandal-ridden presidency. Though it was true that Coolidge had no fondness for small talk, he was a great conversationalist when among friends and had a dry wit that often showed up in his frequent press conferences. In the White House, he made a policy of opening up the Oval Office at 12:30 to visitors who wished to shake their president’s hand. Though his personal style was completely different from Harding’s, Coolidge also gained a huge popularity with the American people.
Just over a year after Coolidge took office, voters proved his popularity by electing to keep him there for another four years. His slogans for the 1924 campaign were "Keep Cool with Coolidge" and "Coolidge or Chaos." The opposition did indeed seem to be in chaos, with the divided Democrats failing to capitalize on the Teapot Dome scandal. To add to their problems, the Progressive party put forth a candidate who drained off Democratic votes, thereby assuring a Republican victory. But the three-way race apparently did not engender a great amount of enthusiasm in the American people, for voter turnout was barely over 50 percent.
From 1923 to 1928, the United States experienced an economic boom and increases in living standards that later gave rise to the phrase, "Coolidge Prosperity." Of course, Coolidge was obviously not single-handedly responsible for these developments, and the prosperity did not by any measure reach all segments of society. The biggest gains in income went to the top 6 percent of the population, and the number of millionaires in the country rose from seven thousand in 1914 to thirty-five thousand in 1928. Yet, major economic and cultural changes took place during those years that affected every American.
The Business of America
By 1924, the economy was thriving and so was big business. The businessman was hailed as a modern hero who provided a great service to society by creating jobs and keeping his country strong. Coolidge summed up the feelings of many when he said, "The man who builds a factory builds a temple…. The man who works there worships there." Around the country, business service clubs such as the Rotarians were popping up, and business was espoused as the manifestation of the American ideal.
The business environment in the United States was undergoing a significant change. Before the war, Progressives warned that large corporations were a threat to democracy. In 1914, the Federal Trade Commission was formed to prevent monopolies and encourage fair competition so that small businesses would not be pushed out by large ones. But, by the time the war was over, much of the steam had already gone out of the Progressive movement. The Child Labor Act, passed by Congress in 1916, was declared unconstitutional by a hostile Supreme Court two years later. During the twenties, Harding and Coolidge appointed conservative members to the FTC who were friendly to big business and less attentive to the concerns of consumers and small businesses.
Coolidge kept Andrew Mellon as secretary of the treasury and agreed with him that a continued hands-off approach to business would keep the economy strong. Commerce Secretary Herbert Hoover promoted trade associations in the hopes that when companies came together, they would share ideas on how to make their businesses more efficient and agree on a code of ethics. The result, however, was that large manufacturers in the same industry would often bypass fair competition by agreeing on a price scale for their goods. The twenties also brought a huge wave of mergers, with major corporations joining forces and further concentrating their power. For example, between 1919 and 1927, more than thirty-seven hundred public utility companies merged into others and disappeared.
New industries that sprang up helped to propel the economy throughout much of the decade and included the brand-new synthetics industry, motion pictures, radio manufacturing, and the manufacturing of light metals such as aluminum. But it was automobile manufacturing that ranked as the most important of all the new industries. A 1923 opinion poll suggested Henry Ford would be a more popular candidate for the presidency than Harding himself.
Another reason for business’s confidence was the exciting boom in productivity that was taking place. Between 1920 and 1929, manufacturing output rose by an amazing 64 percent. Factories were faster and more efficient than ever, due in large part to the new, electrically powered machines that were replacing the old steam-powered equipment. During the twenties, the electricity-generating stations in the United States doubled their capacity as power hungry factories churned out more and more products.
The faster, more efficient factories translated into cost savings for consumers as prices came down. On the negative side, however, workers became familiar with "technological unemployment" as machines replaced people on the assembly-lines.
Other factors in the productivity boom were the new theories of management that took hold in business. The movement to treat management as a science had begun before the war and continued to grow with enthusiasm through the twenties. Managers studied work processes, sales techniques, budgets, and research and development plans to find ways to make companies more efficient and productive. Schools of management were opened at universities, and many young Americans entering the business world set their sights on becoming a manager.
