22-3: Hoover Struggles with the Depression

Hoover’s Philosophy of Government He did not believe that the federal government should be given its citizens direct relief He believed that a chief function of government was to encourage voluntary cooperation among competing interest groups He believed that the government should guide relief measures but not directly participate in them

Hoover’s initial reaction to the stock market crash He asked key leaders to work together to provide solutions and to act in ways that would not make the economic situation worse. (All actions would be voluntary) Hoover believed that the stock market by its nature had peaks and falls and it would fix itself in time, so no drastic measures were needed to be taken.

1930 Economic Situation: The economy continued to worsen Unemployment continued to rise More companies went out of business Soup kitchens, shantytowns, hoboes became common Misery of ordinary people continued to grow Voters Respond to the situation (1930): Republicans lost control of the House of Representatives and saw their majority in the Senate Dwindle to one vote

Hoover and the Bonus Army Hoover opposed immediate payment of bonuses to World War I veterans He ordered an infantry operation to close Anacostia Flats, the shantytown on Capital Hill, the Bonus Marchers were staying. This incident led to 1000 marchers being tear gassed and the death of an infant. The public was outraged that the President would turn the army on its veterans.

Hoover Responds to the economic crisis: Hoover directed federal funds into public works projects, such as Boulder Dam, to jump start the economy and create jobs He backed a series of federal programs including the Federal Farm Board, The National Credit Corporation. The Glass-Steagall Banking Act, The Federal Home Loan Bank Act, and the Reconstruction Finance Corporation How did the economy respond to his efforts?: The Economy continued to deteriorate. Hoover’s efforts amounted to too little, too late.

How did Hoover’s efforts effect his own political situation The failing economy and the Bonus Army incident damaged Hoover’s public image As a result, Democratic Candidate, Franklin D. Roosevelt won the 1932 presidential election

Reconstruction Financing Corporation (RFC) (RFC): Provided emergency financing to banks and other large businesses to fuel business expansion and thereby pump new life into the national economy It’s efforts were too little, too late