“Pandemic?” your editor’s wife looked at him, askance. “What pandemic?”
Surveying the extravagantly appointed dining room, thronged by cheerful revelers and dashing, bow-tied waitstaff, one could indeed be forgiven for thinking 2020 was but a cruel figment of an overactive imagination, a crack in the matrix designed to test our powers of credulity.
To our left sat a pair of silver-winged businessmen who spoke enthusiastically of “retargeting” and “strategic alignment” and “increased visibility.” To our right, a stylish younger couple ordered cocktails and settled in for their gooey-eyed rendezvous. Overhead, a swirling crystal chandelier drew gasps of delighted approval from newcomers as they quaffed champagne from their own sparkling flutes.
Perhaps it was the mood set by that afternoon’s river architecture tour (a must when visiting the Second City), or the heady effects of our own libation of choice (a classic Parisian-style Sidecar) but we could not help harkening back to the Roaring Twenties, with all the glitz and glamour of that bygone era. What might the past be able to teach us about the future, we wondered. For if history does not repeat, goes the old saying, it does occasionally rhyme…
One hundred years ago the USA was still in the ascendency, en route to becoming one of the world’s great superpowers. She had emerged triumphant from WWI, whereas the great European empires – The Hapsburgs (Austro-Hungarians), Ottomans (Turks), Romanovs (Russians) and Wilhelms (Germans) – were left more or less in ruins. Then, as now, the pandemic of the day, the Spanish Flu, was also waning. It must have looked like nothing but blue skies ahead for the Americans as, along with New York City, Chicago led the nation’s inspired reach for the heavens.
Characterized by the exuberance of the era, the 1920s was a period of full faith in the social and technological progress of mankind. With the wind in her sails, America led the world in industry, innovation and production. The world’s largest economy grew more than 40% during that single decade, and per-person GDP rose from less than $6,500 to over $8,000. Stocks began the decade with the Dow Jones Industrial Average at just over 72 points. The index would more than quintuple, in nominal terms, over the epic bull run which took off in 1923. In 1925, a quarter of American families owned a car. By 1929, nearly a quarter of all American citizens owned one. In 1926, the Air Commerce Act authorized commercial airlines. From 1926 to 1929, the number of people flying in planes increased from 6,000 annually to 173,000.
Behind all this growth and excitement, the Federal Reserve was keeping busy too, expanding the money supply by more than 60 percent from mid-1921 (the end of the Depression that Wasn’t) through to mid-1929 (the beginning of the Depression that Was).
Whichever way one looked, everything was up, up and away!
So it was during the Jazz Age that many of this city’s most iconic buildings were completed, including; the neo-gothic Tribune Tower (1922 – command post of the Chicago Tribune newspaper); the adjacent Wrigley Building (1924 – headquarters of the chewing gum empire); the armchair-like Civic Opera Building (1929); the towering Art Deco-style Palmolive Building (1929 – home to Palmolive-Colgate-Peet Corporation), with its beacon added and named for aviator Charles Lindbergh a year later; and our own personal favorite, the old Carbide and Carbon Building (1929 – headquarters of the first company to develop the dry cell battery), now refurbished and renamed the Pendry Chicago Hotel.
Though all stand as monuments to American ingenuity, arts and industry, it is the latter we find of particular note. As the rumor goes, it was erected in staunch (if symbolic) defiance of the federal government’s prevailing governance regarding the “manufacture, sale or transportation of intoxicating liquors.” Clad in dark green and gold terra cotta, and topped in 24 karat gold leafing, the bold structure resembled – you guessed it – a 37-story champagne bottle. To this day the Carbide and Carbon Building stands as a giant middle finger to the government, plonked right in the middle of Capone’s Chicago, during the very height of prohibition.
And to that, we say: Cheers!
Looking around the Adalina dining room, a sea of unmasked faces toasting to the new and bright future, it’s hard not to think about the Go-Go epochs of yore. But then, we remember our tour guide’s haunting words from earlier in the day…
“Take another look across the skyline. You see all the buildings constructed during the thirties and forties?”
The collective necks strained sorely upward… in vain.
The mighty Merchandise Mart and the Ceres-topped Chicago Board of Trade Building (both completed in 1930) were among the last of the city’s ambitious projects to touch the sky before the long lull that followed. After the great crash of 1929, the ‘30s and ‘40s belonged to depression and war. In place of innovation, industry and the pursuit of beauty came destruction, demolition and the reckoning of debts due.
Of course, the 1929-30 recession might not have been anything particularly special. It was, initially, softer than the 1920-21 recession that had preceded it. The critical difference appears to have been the Fed’s response to the shock. In the former contraction, the government went further than simply leave the economy alone; it actually raised rates, cut taxes and slashed federal spending. As James Grant writes in his 2014 book, The Forgotten Depression, 1921:
“The essential point about the long ago downturn of 1920–1921 is that it was kind of the last demonstration of how a price mechanism works and the last governmentally unmediated business cycle downturn, meaning it was the last one that the government didn’t attempt to treat with fiscal intervention with much lower interest rates. In fact, the FED, then still wet behind the ears as it only had been founded in 1914, actually raised rates in the face of a truly brutal deflation.”
Less was more, one might say. Not so for the recession-cum-depression that would bookend the farside of the decade… and bleed on into the next. Having promptly forgotten the lessons from the “Depression that Wasn’t,” the government was slow to think but quick to act when the economy turned south in 1929; federal spending soared, the top tax rate was raised from 25 to 83%, regulations on hiring and investing were multiplied and free trade, a necessary antidote to contracting economies, was stifled under the Smoot-Hawley tariff.
Oh, and the dollar was devalued from 1/20th an ounce of gold to 1/35th an ounce, marking America’s first “soft default.”
Not until the clean and simple lines of Mies van der Rohe’s Lake Shore Drive apartments (1951) picked up on the International Modernist movement, more than two decades later, was the pall finally lifted. Van der Rohe’s “skin and bones,” minimalist architecture was characterized by a simple philosophy, one that Fed Head meddlers would do well to heed, then as now: Less is more.
Joel Bowman
Chicago Il. ~ July, 2021