Corporate liberal thought changed dramatically from 1920 to 1941. During the New Era, corporate liberals espoused welfare capitalism. Private approaches to economic questions still predominated. A few corporate liberals, like Henry Dennison, did welcome Hooverian associationalism, but the contacts between business and government were infrequent and brief compared to the later period. The Great Depression forced corporate liberals to adjust course; increasingly, they forsook welfare capitalism and informal public–private linkages in favor of sustained periods of service within the federal government. Intelligent collaboration between big business and big government, for the purpose of economic renewal, became their new credo. European war provided an even better opportunity for the corporate liberals to advance their cooperative agenda, as they came to dominate the U.S. preparedness campaign. Edward Stettinius, William Knudsen, and Donald Nelson labored intensely to construct a national security apparatus up to the challenges posed by a world gone mad. The organizational edifice they built, though imperfect, facilitated industrial mobilization, pushing American industry to mass production of weapons by the time of the Japanese attack on Pearl Harbor. This development boosted the U.S. war effort considerably while helping to ensure big-business domination of public policy during the war years and beyond.

Corporate liberals depicted welfare capitalism as a way to counteract the few negative side effects of capitalism. Thus, company cafeterias served lowcost, nutritious meals that stretched a decent salary further. Group insurance paid sick or disabled workers; when a worker died, loved ones received life insurance payments. Unemployment insurance offered protection against layoffs, and so on. Most important,workers who received non-wage benefits were less likely to disrupt production by striking. Thus, welfare capitalism ultimately yielded stability and the best guarantee of sustainable prosperity possible in an uncertain world.

From this perspective, maintenance of economic prosperity was primarily a responsibility of private enterprise. Accordingly, corporate liberals concentrated their attention on their own firms. Throughout the 1920s, Dennison, Stettinius, Gerard Swope, Marion Folsom, and Averell Harriman focused on company-specific solutions to general economic maladies. Individual company policies were contrived to minimize swings of the business cycle, maximize employment, and ensure worker satisfaction. The workers themselves characterized welfare capitalism as paternalistic, and would have preferred wage increases anyway, but the American Federation of Labor was too weak to alter the existing state of affairs.