Hoover Struggles with the Depression Chapter 22.3

Did Hoover do too much or too little? We will take a look at two different interpretations of Hoover’s response to the Great Depression.

Hoover’s response… Hoover initially does very little to respond to the depression, citing the Republican belief in laissez-faire capitalism. In other words… he believes that the free market will “fix itself.” “Mutual-help through voluntary giving” This means that Hoover felt that people should rely on their churches, neighbors, and other forms of voluntary charity.

International Trade Hawley-Smoot Tariff – A law meant to protect farmers and manufacturers in the U.S. from foreign competition. HOWEVER… Europe responded by raising their own tariffs and as a result America’s farmers and businesses could not sell their excess goods overseas. Many economists beg Hoover not to sign the Hawley-Smoot Tariff into law claiming that it will have negative effects on trade

What did Hoover do? Hoover forms the Reconstruction Finance Corporation (RFC) which loaned money to banks, railroads, and insurance companies to save American businesses and jobs. Hoover hoped these loans would stimulate the economy and companies would begin hiring. Prosperity would “trickle down through the economy” …DOES THIS SOUND FAMILIAR?

Angry Veterans Veterans of WWI are very angry because the government did not fulfill its promises to them after the war (bonuses)

Angry Veterans Congress initially planned to pay the soldiers in 1945 a $500 bonus in the form of cash and a life insurance policy. The veterans wanted the money that Congress had promised them… they wanted it now because times were tough.

Hoover initially allowed the group to peacefully protest but eventually grew tired of their presence fearing that they would grow violent. (“They’re communists!”) He ordered the military to use tear gas to break up the protest resulting in the deaths of an 11-month old baby, and an 8-year old boy becoming partially blinded. 1,000 people were gassed in total. This creates horrible press for Hoover who is about to head into a re-election campaign

Summary Interpretation 1: Hoover’s inability to deal with the depression and the bad press from the bonus army incident sealed his political fate. His opponent, Franklin Delano Roosevelt would have no problem beating him in the election with his New Deal platform. Many remember Hoover as a “failed president”

Interpretation 2: A Different interpretation (Hoover did TOO MUCH): http://www.youtube.com/watch?v=KfeHWnaK7rY -Prager University is NOT an accredited university and you cannot earn a degree there. They just offer classes for the sake of classes.

Write: Did Hoover do too much or too little to alleviate the economic and social problems of the Great Depression? Write one paragraph explaining YOUR interpretation.