Chapter 21 Section 3 US Global Studies 10 Mr. Riddlebarger Hoover as President Chapter 21 Section 3 US Global Studies 10 Mr. Riddlebarger

Herbert Hoover’s Philosophy Hoover believed government should play as little role as possible in affairs of business “Rugged Individualism” Important for nation’s well-being not to destroy people’s belief in their own responsibility & power.

Hoover Dam Hoover did believe in voluntary partnerships between business associations and government Associative state Consulted business leaders in order to pursue national goals Building of Hoover Dam- provided electricity & water to 7 states

“Economic depression cannot be cured by legislative action or executive pronouncement. Economic wounds must be healed by the action of the cells of the economic body- the producers and consumers themselves.” “We have now passed the worst.” -1930

Early Depression Years 1930: 1,352 banks fail= $853 million in deposits 1931: 2,294 banks fail= $1.7 billion in deposits 1930: 26,355 businesses fail 1931: 28,285 businesses fail 1932: $5.64 billion in corporate debt Farm property value falls from $57.7 billion ($78.3 billion in 1920) to $51.8 billion in 1931 1931: Unemployment = 8 million (and rising). 12 million a few months later.

Hoover’s Response to the Great Depression Hoover believed the government should not provide direct aid to people. Instead, government should help people help themselves. After stock market crash, Hoover stuck to belief in voluntary action & government/business cooperation . Asked business leaders not to cut pay or jobs.

Direct Action In the face of economic disaster, most weren’t interested in cooperation, instead looking out for themselves. Businesses cut jobs & lowered wages Consumers stopped spending Puts more people out of work. This plunges the economy into the Great Depression. Hoover decides to break with his beliefs Creates programs for loans to banks & reducing home foreclosures. Reconstruction Finance Corporation (RFC) Historic expansion of the role of government Seen as too little, too late.

Smoot-Hawley Tariff Protectionism High Tariff causes trading partners to do the same S-H Tariff was to protect farms goods Hurts economies of all

NATION RESPONDS TO HOOVER Hoover increasingly comes under attack for his handling of the Depression. Early in the crisis, he had said: “I am convinced that we have passed the worst.” In fact the worst was yet to come. His unwillingness to give direct relief to people made many question his compassion. Hoovervilles Hoover blankets RFC seen as giving billions to banks & industry but nothing to individuals.

Bonus March 15,000 World War I veterans set up camp near capitol in 1932. Seeking cash reward they were promised Not supposed to be paid until 1945. Men needed money now

Bonus March Numbers grow through summer months. Some leave when Congress refuses to grant bonus early; others stay Hoover sends in army & police to clear them out. Causes violence Hoover again appears to be indifferent to needs of nation’s poor.