Many of the slogans attached to the decade of the 1920s solidify the view that – at least as far as economic thinking was concerned – this was indeed an antediluvian age. The “return to normalcy” that Warren G. Harding pledged in his successful campaign for the presidency in 1920 scarcely suggests that innovative economic thought was likely to find houseroom in official quarters. Support for the status quo ante was also apparent in America's rejection of Wilson's architecture for a League of Nations and in the isolationist attitudes that went with it. There was influential weight behind these positions, which were articulated at the highest levels in the pronouncements of Presidents Harding and Coolidge about the paramount importance of minimal governmental intervention in the economy, about the sanctity of fiscal responsibility and balanced budgets, and about the moral obligation of wartime allies to discharge their debts to the U.S. government on commercial terms. Coolidge pithily summed up a major strand of the mood of the time with his assertion that “the business of America is business.” The unarticulated but self-evident corollary was that government should generally stand aloof from the functioning of the private market economy.

All of this rhetoric reflected an important component of the Zeitgeist of post–World War I America. But another strand of doctrine was also taking shape in these years – and it was one that took a quite different reading of the role of government in the economy.