Herbert Hoover and The Great Depression

CHA3U

"We in America today are nearer to the final triumph over poverty than ever before in the history of any land. The poorhouse is vanishing from among us."

- Herbert Hoover accepting the Republican nomination for president in

1928

Herbert Hoover (1929-1933)

• Republican• 1928 election landslide

victory over Democrat Al Smith

• Inherited prosperous + optimistic nation

• Efficiency Movement – a former engineer, believed technological solution existed for every social/economic problem

The Great Crash of 1929

• Three phases – October 24th, 28th and 29th

• Catastrophic downturn of Black Monday and Tuesday (28th and 29th) precipitated widespread panic

• NYSE – lost $30 billion in one week

• Onset of unprecedented and long-lasting consequences for U.S.

The Crash

Causes of The Great Depression

1. Structural weaknesses in both American agriculture and industry

2. Frailty of international economy in late 1920s and early 1930s

3. Overly speculative and unstable foundations of American financial sector

Hoover’s Response

• His policies had little or no effect

• Mexican Repatriation Program (1929) – forced 500 000 Mexicans/Mexican-Americans south of border in effort to combat unemployment

• Smoot-Hawley Tariff Act (1930) raised tariffs on imported goods and encouraged people to buy American

Banks

• 2 200 banks failed in 1931• Hoover convinced leading bankers to

voluntarily est. National Credit Corporation (1932)

• Used $500 million reserve to aid small, insolvent banks

• Failed b/c business leaders reluctant to bailout small banks

• Economy showed no signs of recovery

Reconstruction Finance Corporation (1932)

• RFC – Hoover's most important achievement

• Government funded and operated• Designed to provide credit to large

business concerns ; railroads, banks, insurance companies, agricultural sector

• Historians now praise RFC for saving many of nation’s larger financial institutions from ruin

Hooverville

• 1932 – unemployment 25%

• Hooverville – nickname of tent cities/shanty towns built by homeless

• Houses built of box wood, cardboard and sheet metal

Bonus Army

• 1932 – 17 000 WWI veterans march on Washington

• Demanded immediate and early payment of WWI bonus

• $1.25 for each day of overseas service plus interest

Bonus Army

• Camped in Hooverville on the Anacostia Flats - a muddy area across the Anacostia River from the federal core of Washington

• July 28th – under command of Gen. Douglass MacArthur, infantry tank and cavalry regiments attack veterans

• Hoover order end to attack, MacArthur ignored order

Aftermath

• Attacked w/ tanks, tear gas, bayonets, guns• Burned camps in Anacostia, killing one Bonus

Army member• MacArthur repeatedly ignored orders to halt

rampage• Americans saw horrific images of the attack in

newspapers• MacArthur refused to take responsibility• Hoover accepted blame and standing w/ public

sank • 1932 election - Hoover’s chance of winning nearly

extinct

Election of 1932

• Democrats nominated N.Y. Governor Franklin Delano Roosevelt

• "I pledge you, I pledge myself, to a new deal for the American people."

The Election of 1932

• Said that “Even a vaguely talented dog-catcher could have been elected president against the Republicans…”

• FDR wins sweeping victory• Realigning election - Republicans had

controlled the Presidency for 56 of the previous 72 years

• Great Depression officially became FDR’s problem in March 1933

Election of 1932

Legacy of Hoover

• By time he left office, nation’s banking system had collapsed

• Economy at a halt• Left office w/reputation of

a do-nothing President • For years was blamed

for the Great Depression and efforts to solve the crisis criticized

• Unfair judgment??