Hoover’s Response to the Great Depression

Voluntary Efforts and Public Works Hoover brought together the heads of banks, railroads, big businesses, labor and government officials. Agreement: keep factories open and stop lowering wages Hoover increased public works = replacement jobs for those who were laid off Hoover refused to increase government spending so there were not enough new jobs being created

Putting Money Into the Economy Hoover formed the National Credit Corporation (NCC) The NCC created a collection of money that would allow banks in distress to continue lending money to corporations to expand production Hoover asked Congress to create the Reconstruction Finance Corporation (RFC) Make loans to banks, railroads, and agricultural institutions The RFC did not increase its loans enough to meet the needs so the economy continued to decline

Help for Citizens “Relief” was money that went directly to impoverished families Hoover opposed federal relief; believed relief should be given by state and city governments only 1932: Congress passes the Emergency Relief and Construction Act Allotted money for public works as well as loans to states for relief; too late to prevent the collapse

The Mood of America Hunger Marches by the American Communist party Looting of grocery stores Many farmers were suffering due to low prices for crops; couldn’t pay mortgages Foreclosure on at least a million farmers; families were evicted Farmers began to destroy their crops on purpose as a means of raising crop prices

The “Bonus Army” After WWI, American soldiers and sailors were promised $1,000 bonus for each veteran beginning in 1945 1932: Veterans from Portland, Oregon began a march to Washington: lobby for early payment The Senate voted down the legislation Many veterans who had come to Washington decided to stay in unoccupied buildings downtown

Response to Bonus Army President ordered buildings to be cleared Army Chief of Staff Douglas MacArthur sent cavalry, infantry, and tanks to rid Washington of the veterans: focus on buildings only Veterans were assaulted by troops using bayonets and tear gas