13.2 Hoover administration's economic policies

Herbert Hoover's response to the Great Depression was rooted in American individualism and limited government intervention. His approach relied on voluntary cooperation and private sector solutions, resisting direct federal relief and emphasizing optimism in public statements.

Hoover's policies, including the Smoot-Hawley Tariff and Reconstruction Finance Corporation, proved ineffective in addressing the crisis. Public perception shifted dramatically, with Hoover viewed as favoring big business over average citizens. This led to his landslide defeat in the 1932 election.

Hoover's Economic Policies and the Great Depression

Hoover's limited intervention approach

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Top images from around the web for Hoover's limited intervention approach

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  Herbert Hoover and the Politics of the Depression | US History II (American Yawp) View original

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  The Stock Market Crash of 1929 – US History II View original

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  The Stock Market Crash of 1929 | United States History II: Since 1865 View original

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  Herbert Hoover and the Politics of the Depression | US History II (American Yawp) View original

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• Hoover's economic philosophy championed American individualism emphasized voluntary cooperation limited federal government role
• Initial response to stock market crash featured optimistic public statements relied on private sector solutions downplayed severity
• Voluntary measures included conferences with business leaders encouraged wage maintenance promoted public works by state and local governments
• Resistance to direct federal relief opposed "dole" system preferred loans over grants feared dependency

Effectiveness of Hoover's economic policies

• Smoot-Hawley Tariff Act (1930) aimed to protect American businesses and farmers backfired reduced international trade provoked retaliation deepened global crisis
• Reconstruction Finance Corporation (RFC) established 1932 provided loans to banks railroads businesses had limited impact due to strict lending criteria
• Federal Home Loan Bank Act (1932) created to support mortgage lending proved insufficient to address housing crisis (foreclosures continued)
• Emergency Relief and Construction Act (1932) authorized public works projects implemented too late to be effective (unemployment remained high)

Public perception of Hoover's leadership

• Public perception shifted from capable leader to ineffective as crisis worsened viewed as favoring big business over average citizens
• Hoovervilles symbolized hardship shantytowns named after president "Hoover flags" (empty pockets) mocked economic failures
• Media portrayal turned negative press coverage critical political cartoons depicted Hoover as indifferent out of touch
• Bonus Army incident (1932) violent dispersal of World War I veterans severely damaged Hoover's public image seen as callous
• 1932 presidential election resulted in landslide victory for Franklin D. Roosevelt Hoover associated with failed economic policies rejected by voters

Hoover vs Roosevelt on Depression

• Philosophical differences: Hoover advocated limited government intervention Roosevelt embraced active federal role in economy society
• Scale of government action: Hoover implemented gradual limited expansion of federal programs Roosevelt rapidly executed extensive New Deal policies
• Relief efforts: Hoover emphasized local private charity Roosevelt provided direct federal aid (Works Progress Administration, Civilian Conservation Corps)
• Banking and financial reforms: Hoover established RFC loans to banks Roosevelt passed Banking Act of 1933 created FDIC
• Labor policies: Hoover sought voluntary agreements with business leaders Roosevelt supported unions passed National Labor Relations Act
• Agricultural policies: Hoover created Federal Farm Board (limited success) Roosevelt implemented Agricultural Adjustment Act price supports
• Public perception and communication: Hoover perceived as aloof ineffective Roosevelt projected confidence action through Fireside chats