The Roaring Twenties -- Coolidge oversaw the growth
of the economy; while Hoover, Roosevelt both
inhibited free enterprise: as souvenirs
of massive government they left Depression Years.
The post-war Harding term was called "Return to Normalcy,"
but Teapot Dome instead recalls a kickback policy
(was this normality?). Then silent Calvin Coolidge said
"the business of America is business" - he'd embed
a sense of laissez-faire in government. The end result
was steady economic growth. The country would exult
in new consumption: cars and radio and telephone.
And inequality was down - the middle-class had grown
as never seen before. But overseas our growing might
was cause for apprehension (though our efforts to invite
cooperation were in evidence when banker Dawes
helped bail the German Mark). Yet other 'helpful' acts were cause
for critical concern, like policies of arms control
(utopian, and giving arms-deprived regimes a goal
of newer weapons). And the Kellogg Pact, which outlawed war!
Such ill-advised initiatives would serve to underscore
big government futility. Yet Hoover would be next.
His business intervention would have certainly perplexed
a Jeffersonian. He beat Al Smith (in "every pot
a chicken"), first among the Democratic juggernaut
of city voters. Hoover took the blame for '29,
as overlending and the wealth imbalance would combine
(so says the myth) to crash the market. Pockets inside-out
(the "Hoover hankies") dried the nation's tears until the doubt
and damage was removed by FDR. Reality
conflicts with that assessment. Government would oversee
the failure, as the market served, as always, to reflect
productiveness, high wages, and demand. It's incorrect
to blame the rich - the middle-class was growing. The supply
of money, though, was shrinking, and the Fed would magnify
the problem, making money tighter. And the tariff (Smoot
and Hawley) meant that higher import fees would constitute
a higher cost of doing business, so the companies
began to sell their stock. And Hoover, seeking to appease
the public with a lower income tax, intensified
the problem (lower taxes for the wealthy to provide
a stimulus was not to be). The system crashed, devoid
of capital. Some cities had three-quarters unemployed.