“Any lack of confidence in the economic future or the basic strength of business in the
United States is foolish”: President Herbert Hoover and the Great Depression
Read the following description of President Herbert Hoover’s approach to the Great Depression. As you
read, create on a separate sheet of paper a T-chart of Hoover’s beliefs and his actions to alleviate the
Depression.
President Herbert Hoover came to the presidency with a core set of beliefs he had formed as an
engineer, head of the food Administration in World War One, and as President Coolidge’s Secretary of
Commerce. Central to these beliefs was that government intervention into the economy should be kept to a
minimum. He believed that unnecessary government involvement in the economy threatened the prosperity of
the nation. Hoover feared that too much intervention or coercion by the government would destroy
individuality and self-reliance, which he considered to be important American values. His belief in laissez-faire
was what he referred to when he spoke of “rugged individualism” that made America great.
President Hoover's stance on the economy was based on volunteerism and localism. From before his
entry to the presidency, he was among the greatest proponents of the concept that public-private cooperation
was the way to achieve high long-term growth. Hoover called for an associative state. This meant that
businesses should form voluntary associations with one another to make the economy more fair and efficient.
Then government would work with businesses to help meet national goals.
After the stock market crash President Hoover urged businesses to work together to help avoid a deep
economic recession. To meet this end, he worked with Congress to establish the President's Emergency Relief
Organization to coordinate local private relief efforts resulting in over 3,000 relief committees across the U.S.
Soon after the stock market crash, President Hoover:
• Summoned industrialists to the White House and secured promises that businesses would maintain
workers wages
• From the nation's utilities, Hoover won commitments of $1.8 billion in new construction and repairs for
1930 from the nation’s utility companies
• Railroad executives made a similar pledge
• Got organized labor to agree to withdraw its latest wage demands.
• Ordered federal departments to speed up construction projects
• Contacted all forty-eight state governors to make a similar appeal for expanded public works
• Went to Congress with a $160 million tax cut, coupled with a doubling of resources to loan to states for
the construction of public buildings and dams, highways and harbors
• Appointed a Federal Farm board that tried to raise farm prices
President Hoover also used economic policy to try and stimulate the economy. In 1930, Hoover signed the
Smoot-Hawley Tariff Act, which raised tariffs on over 20,000 dutiable items. The tariff blocked the sale of
many European goods in the United States. In response, many nations around the world raised their tariffs as
well. The 1932 Revenue Act raised taxes on the highest incomes from 25% to 63%, doubled the estate
(inheritance) tax, and increased corporate taxes by almost 15%.
As the depression deepened, President Hoover ignored his beliefs of direct government involvement in the
economy and pushed for increased government spending on public works projects (building, bridges, dams,
roads, etc.). Some of Hoover's efforts to stimulate the economy through public works included:
– Asking Congress for a $400 million increase in the Federal Building Program
– Directing the Department of Commerce to establish a Division of Public Construction
– Increasing subsidies (government financial assistance) for ship construction through the Federal
Shipping Board
– Urging the state governors to also increase their public works spending, though many failed to take
any action.
– Signed the Federal Home Loan Bank Act establishing the Federal Home Loan Bank system to assist
citizens in obtaining financing to purchase a home.
– Increased subsidies to the nation's struggling farmers with the Agricultural Marketing Act
– Urged bankers to form the National Credit Corporation to assist banks in financial trouble and protect
depositors' money
– Establishing the Reconstruction Finance Corporation, which:
• Made loans to the states for public works and unemployment relief
• Made loans to banks, railroads and agriculture credit organization
Hoover’s Beliefs
Hoover’s Actions
President Herbert Hoover’s failure to end the Great
Depression was due to his policies
President Herbert Hoover’s failure to end the Great
Depression was due to the circumstances.
We have examined the Hoover administration and how it attempted to address the issues of the Great Depression. By 1932 it became
apparent that Hoover was unable to resolve the economic troubles plaguing the nation. Your task is to write an obituary for the recently deceased
Hoover administration. You will want to consider the Hoover Administration as a living being who has passed away. Be sure to include the following
in your obituary:
• A description of two specific efforts made by President Hoover to address the problems of the Depression
• At least three specific problems that
• Why the document finally ‘died’
• Write in the format of an obituary
• Survivors
• Cause of death
• Date of birth/date of death
Directions: On this side of the paper compose a campaign poster/flyer for Herbert Hoover for when he was running
for President in 1928. The poster should express Hoover’s beliefs about the government and the economy. On the
back of this paper compose a poster/flyer for Hoover in 1932 that describes the actions he took as President to try to
address the Great Depression. Both posters have to feature (1) a drawing of Hoover,(2) an amazing, catchy slogan,
and (3) some information/explanation of Hoover’s beliefs/actions.