What Did Hoover Do to Solve the Great Depression

Learning Objectives

By the end of this section, you will exist able to:

• Explain Herbert Hoover's responses to the Cracking Depression and how they reflected his political philosophy
• Identify the local, metropolis, and country efforts to gainsay the Cracking Low
• Analyze the frustration and acrimony that a bulk of Americans directed at Herbert Hoover

President Hoover was unprepared for the scope of the depression crisis, and his limited response did non begin to aid the millions of Americans in demand. The steps he took were very much in keeping with his philosophy of limited authorities, a philosophy that many had shared with him until the upheavals of the Great Depression fabricated it clear that a more direct government response was required. But Hoover was stubborn in his refusal to give "handouts," as he saw direct regime help. He chosen for a spirit of volunteerism amid America's businesses, request them to keep workers employed, and he exhorted the American people to tighten their belts and make do in the spirit of "rugged individualism." While Hoover's philosophy and his appeal to the country were very much in keeping with his grapheme, it was not plenty to keep the economy from plummeting farther into economic chaos.

The steps Hoover did ultimately take were too footling, too late. He created programs for putting people back to work and helping beleaguered local and land charities with assistance. But the programs were minor in scale and highly specific as to who could do good, and they but touched a pocket-size percentage of those in need. Equally the situation worsened, the public grew increasingly unhappy with Hoover. He left role with one of the lowest approval ratings of any president in history.

THE INITIAL REACTION

In the immediate aftermath of Black Tuesday, Hoover sought to reassure Americans that all was well. Reading his words subsequently the fact, it is easy to discover mistake. In 1929 he said, "Any lack of confidence in the economic future or the force of business in the Us is foolish." In 1930, he stated, "The worst is backside u.s.." In 1931, he pledged federal help should he e'er witness starvation in the land; only as of that date, he had nevertheless to see such need in America, despite the very real evidence that children and the elderly were starving to death. Yet Hoover was neither intentionally blind nor unsympathetic. He simply held fast to a conventionalities organisation that did not change equally the realities of the Great Depression gear up in.

Hoover believed strongly in the ethos of American individualism: that hard work brought its own rewards. His life story testified to that belief. Hoover was born into poverty, fabricated his way through college at Stanford University, and somewhen made his fortune as an engineer. This feel, too as his extensive travels in Prc and throughout Europe, shaped his fundamental confidence that the very existence of American civilization depended upon the moral fiber of its citizens, as evidenced by their ability to overcome all hardships through private effort and resolve. The idea of regime handouts to Americans was repellant to him. Whereas Europeans might need assistance, such every bit his hunger relief work in Belgium during and after World War I, he believed the American grapheme to be unlike. In a 1931 radio accost, he said, "The spread of government destroys initiative and thus destroys grapheme."

Likewise, Hoover was not completely unaware of the potential harm that wild stock speculation might create if left unchecked. As secretary of commerce, Hoover oft warned President Coolidge of the dangers that such speculation engendered. In the weeks earlier his inauguration, he offered many interviews to newspapers and magazines, urging Americans to curtail their rampant stock investments, and fifty-fifty encouraged the Federal Reserve to heighten the discount rate to make information technology more costly for local banks to lend money to potential speculators. Nevertheless, fearful of creating a panic, Hoover never issued a stern warning to discourage Americans from such investments. Neither Hoover, nor any other politician of that twenty-four hours, ever gave serious thought to outright government regulation of the stock market. This was even true in his personal choices, equally Hoover frequently lamented poor stock advice he had once offered to a friend. When the stock nose-dived, Hoover bought the shares from his friend to assuage his guilt, vowing never again to propose anyone on matters of investment.

In keeping with these principles, Hoover's response to the crash focused on two very common American traditions: He asked individuals to tighten their belts and work harder, and he asked the business community to voluntarily help sustain the economy past retaining workers and continuing production. He immediately summoned a conference of leading industrialists to run across in Washington, DC, urging them to maintain their current wages while America rode out this cursory economic panic. The crash, he assured business leaders, was not function of a greater downturn; they had naught to worry about. Similar meetings with utility companies and railroad executives elicited promises for billions of dollars in new construction projects, while labor leaders agreed to withhold demands for wage increases and workers continued to labor. Hoover also persuaded Congress to laissez passer a $160 meg taxation cut to bolster American incomes, leading many to conclude that the president was doing all he could to stem the tide of the panic. In April 1930, the New York Times editorial board concluded that "No i in his place could accept done more than."

However, these modest steps were not enough. By late 1931, when information technology became clear that the economy would not improve on its own, Hoover recognized the demand for some government intervention. He created the President's Emergency Committee for Employment (PECE), later renamed the President'southward Organisation of Unemployment Relief (POUR). In keeping with Hoover's distaste of what he viewed equally handouts, this organization did non provide direct federal relief to people in need. Instead, information technology assisted state and private relief agencies, such as the Reddish Cross, Salvation Ground forces, YMCA, and Community Chest. Hoover too strongly urged people of means to donate funds to assist the poor, and he himself gave meaning private donations to worthy causes. But these private efforts could non convalesce the widespread effects of poverty.

Congress pushed for a more than directly government response to the hardship. In 1930–1931, information technology attempted to pass a $60 meg bill to provide relief to drought victims past assuasive them access to food, fertilizer, and fauna feed. Hoover stood fast in his refusal to provide food, resisting any element of direct relief. The final bill of $47 one thousand thousand provided for everything except food simply did non come shut to adequately addressing the crisis. Once again in 1931, Congress proposed the Federal Emergency Relief Bill, which would have provided $375 meg to states to assistance provide food, clothing, and shelter to the homeless. But Hoover opposed the bill, stating that it ruined the remainder of power between states and the federal government, and in February 1932, information technology was defeated by fourteen votes.

However, the president's adamant opposition to direct-relief federal government programs should not be viewed as one of indifference or uncaring toward the suffering American people. His personal sympathy for those in need was boundless. Hoover was ane of simply 2 presidents to decline his salary for the office he held. Throughout the Great Depression, he donated an average of $25,000 annually to various relief organizations to assist in their efforts. Furthermore, he helped to heighten $500,000 in private funds to support the White House Conference on Child Wellness and Welfare in 1930. Rather than indifference or heartlessness, Hoover's steadfast adherence to a philosophy of individualism as the path toward long-term American recovery explained many of his policy decisions. "A voluntary deed," he repeatedly commented, "is infinitely more than precious to our national ideal and spirit than a thousand-fold poured from the Treasury."

Equally conditions worsened, however, Hoover eventually relaxed his opposition to federal relief and formed the Reconstruction Finance Corporation (RFC) in 1932, in part because information technology was an election year and Hoover hoped to keep his part. Although not a form of direct relief to the American people in greatest need, the RFC was much larger in telescopic than any preceding attempt, setting aside $2 billion in taxpayer money to rescue banks, credit unions, and insurance companies. The goal was to boost confidence in the nation's fiscal institutions by ensuring that they were on solid footing. This model was flawed on a number of levels. Kickoff, the program only lent money to banks with sufficient collateral, which meant that about of the assist went to large banks. In fact, of the outset $61 one thousand thousand loaned, $41 million went to simply 3 banks. Modest town and rural banks got almost nil. Furthermore, at this time, conviction in financial institutions was not the chief business of virtually Americans. They needed nutrient and jobs. Many had no coin to put into the banks, no matter how confident they were that the banks were safe.

Hoover's other endeavor at federal assist also occurred in 1932, when he endorsed a beak past Senator Robert Wagner of New York. This was the Emergency Relief and Construction Act. This act authorized the RFC to aggrandize beyond loans to financial institutions and allotted $ane.5 billion to states to fund local public works projects. This program failed to evangelize the kind of help needed, however, as Hoover severely express the types of projects information technology could fund to those that were ultimately self-paying (such as cost bridges and public housing) and those that required skilled workers. While well intended, these programs maintained the status quo, and there was even so no direct federal relief to the individuals who so desperately needed it.

PUBLIC REACTION TO HOOVER

Hoover's steadfast resistance to government assistance cost him the reelection and has placed him squarely at the forefront of the virtually unpopular presidents, according to public stance, in modern American history. His name became synonymous with the poverty of the era: "Hoovervilles" became the common proper noun for homeless shantytowns and "Hoover blankets" for the newspapers that the homeless used to keep warm. A "Hoover flag" was a pants pocket—empty of all money—turned within out. By the 1932 ballot, hitchhikers held up signs reading: "If yous don't requite me a ride, I'll vote for Hoover." Americans did not necessarily believe that Hoover caused the Smashing Low. Their anger stemmed instead from what appeared to be a willful refusal to assistance regular citizens with direct aid that might let them to recover from the crisis.

Hoover became one of the least popular presidents in history. "Hoovervilles," or shantytowns, were a negative reminder of his office in the nation's fiscal crisis. This family (a) lived in a "Hooverville" in Elm Grove, Oklahoma. This shanty (b) was one of many making upward a "Hooverville" in the Portland, Oregon surface area. (credit: modification of piece of work past United States Farm Security Administration)

FRUSTRATION AND PROTEST: A BAD Situation GROWS WORSE FOR HOOVER

Desperation and frustration ofttimes create emotional responses, and the Smashing Low was no exception. Throughout 1931–1932, companies trying to stay adrift sharply cut worker wages, and, in response, workers protested in increasingly biting strikes. As the Depression unfolded, over lxxx percent of automotive workers lost their jobs. Fifty-fifty the typically prosperous Ford Motor Company laid off 2-thirds of its workforce.

In 1932, a major strike at the Ford Motor Company factory near Detroit resulted in over sixty injuries and four deaths. Frequently referred to as the Ford Hunger March, the event unfolded every bit a planned demonstration among unemployed Ford workers who, to protest their drastic situation, marched 9 miles from Detroit to the company's River Rouge institute in Dearborn. At the Dearborn city limits, local law launched tear gas at the roughly three thousand protestors, who responded past throwing stones and clods of dirt. When they finally reached the gates of the found, protestors faced more police and firemen, as well equally private security guards. Equally the firemen turned hoses onto the protestors, the police and security guards opened burn down. In add-on to those killed and injured, law arrested l protestors. One week later, lx thousand mourners attended the public funerals of the four victims of what many protesters labeled police brutality. The effect gear up the tone for worsening labor relations in the U.Due south.

Farmers likewise organized and protested, often violently. The almost notable example was the Farm Holiday Clan. Led by Milo Reno, this organisation held pregnant sway among farmers in Iowa, Nebraska, Wisconsin, Minnesota, and the Dakotas. Although they never comprised a majority of farmers in any of these states, their public deportment drew press attention nationwide. Among their demands, the association sought a federal government programme to set agricultural prices artificially loftier enough to cover the farmers' costs, as well as a government commitment to sell any farm surpluses on the world market. To achieve their goals, the group called for subcontract holidays, during which farmers would neither sell their produce nor purchase any other goods until the authorities met their demands. However, the greatest strength of the association came from the unexpected and seldom-planned actions of its members, which included barricading roads into markets, attacking nonmember farmers, and destroying their produce. Some members even raided small town stores, destroying produce on the shelves. Members also engaged in "penny auctions," bidding pennies on foreclosed farm state and threatening any potential buyers with actual impairment if they competed in the sale. In one case they won the auction, the clan returned the land to the original owner. In Iowa, farmers threatened to hang a local judge if he signed whatsoever more farm foreclosures. At least one death occurred as a direct result of these protests before they waned following the election of Franklin Roosevelt.

One of the virtually notable protestation movements occurred toward the cease of Hoover'due south presidency and centered on the Bonus Expeditionary Force, or Bonus Army, in the spring of 1932. In this protest, approximately fifteen thousand World War I veterans marched on Washington to demand early payment of their veteran bonuses, which were not due to exist paid until 1945. The group camped out in vacant federal buildings and prepare camps in Anacostia Flats near the Capitol building.

In the spring of 1932, Globe War I veterans marched on Washington and prepare up camps in Anacostia Flats, remaining there for weeks. (credit: Library of Congress)

Many veterans remained in the city in protestation for nearly two months, although the U.S. Senate officially rejected their request in July. By the middle of that month, Hoover wanted them gone. He ordered the constabulary to empty the buildings and articulate out the camps, and in the commutation that followed, police force fired into the crowd, killing two veterans. Fearing an armed uprising, Hoover then ordered General Douglas MacArthur, along with his aides, Dwight Eisenhower and George Patton, to forcibly remove the veterans from Anacostia Flats. The ensuing raid proved catastrophic, as the military burned down the shantytown and injured dozens of people, including a twelve-calendar week-old infant who was killed when accidentally struck by a tear gas canister.

When the U.S. Senate denied early payment of their veteran bonuses, and Hoover ordered their makeshift camps cleared, the Bonus Army protest turned fierce, cementing Hoover's demise equally a president. (credit: U.S. Department of Defense)

As Americans bore witness to photographs and newsreels of the U.S. Army forcibly removing veterans, Hoover'due south popularity plummeted even further. Past the summer of 1932, he was largely a defeated homo. His pessimism and failure mirrored that of the nation's citizens. America was a country in desperate need: in need of a charismatic leader to restore public confidence as well equally provide concrete solutions to pull the economic system out of the Bang-up Depression.

Whether he truly believed information technology or simply thought the American people wanted to hear it, Hoover continued to state publicly that the land was getting back on track. Heed as he speaks well-nigh the "Success of Recovery" at a campaign stop in Detroit, Michigan on October 22, 1932.

Section Summary

President Hoover'southward deeply held philosophy of American individualism, which he maintained despite extraordinary economic circumstances, made him particularly unsuited to deal with the crisis of the Smashing Depression. He greatly resisted government intervention, considering it a path to the downfall of American greatness. His initial response of request Americans to notice their ain paths to recovery and seeking voluntary business measures to stimulate the economy could non stem the tide of the Low. Ultimately, Hoover did create some federal relief programs, such as the Reconstruction Finance Corporation (RFC), which sought to heave public confidence in financial institutions past ensuring that they were on solid footing. When this measure did trivial to assist impoverished individuals, he signed the Emergency Relief Human action, which allowed the RFC to invest in local public works projects. Merely fifty-fifty this was too footling, too late. The astringent limits on the types of projects funded and type of workers used meant that almost Americans saw no do good.

The American public ultimately responded with acrimony and protestation to Hoover's apparent inability to create solutions. Protests ranged from factory strikes to farm riots, culminating in the notorious Bonus Army protest in the spring of 1932. Veterans from World War I lobbied to receive their bonuses immediately, rather than waiting until 1945. The government denied them, and in the ensuing chaos, Hoover called in the military to disrupt the protest. The violence of this human action was the final blow for Hoover, whose popularity was already at an all-time low.

Review Question

1. What attempts did Hoover make to offer federal relief? How would you evaluate the success or failure of these programs?

Answer to Review Question

1. Hoover formed the Reconstruction Finance Corporation (RFC) in 1932. This represented a significant effort, although information technology did not provide any directly aid to needy Americans. The RFC gear up aside $ii billion in taxpayer money to rescue banks, credit unions, and insurance companies, hoping to promote Americans' confidence in financial institutions. However, by lending coin just to banks with sufficient collateral, he ensured that virtually of the recipients of the assist were large banks. Additionally, most Americans at this fourth dimension did not have assets to identify into banks, notwithstanding confident they may have felt. In 1932, Hoover too endorsed the Emergency Relief and Construction Act, which allotted $1.v billion to states to fund local public works projects. Hoover's limitations upon the types of projects that could receive funding and the types of workers who could participate, all the same, limited the program's utility.

Glossary

American individualismthe belief, strongly held by Herbert Hoover and others, that hard work and individual endeavour, absent regime interference, comprised the formula for success in the U.Southward.

Bonus Armya group of Earth War I veterans and affiliated groups who marched to Washington in 1932 to demand their war bonuses early, only to exist refused and forcibly removed by the U.S. Army

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