President Hoover’s Reaction to the Depression

 

Hoover had served as Secretary of

     Commerce under Coolidge and was a

     self-made millionaire and excellent

     businessman

 

Had a reputation worldwide as the leader of

     the relief effort to help starving people and

     to revive Europe’s econmy after World

     War One

 

So what did he do to help the Depression?

 

Tried to inspire confidence through

     statements such as “Prosperity is just

     around the corner”

 

Changed his belief that government shouldn’t

     be involved in the economy

 

Promoted programs to aid business so that

     their recovery would “trickle down” to the

     people 

Organized the Reconstruction Finance

     Corporation in 1932 to lend money to

     railroads,mortgage and insurance

     companies, and banks

 

Set a precendent that FDR would follow by

     creating federal works projects to create

     jobs and stimulate the economy

 

Worked for voluntary promises from business

     not to lower wages or prices which they

     often couldn’t keep

 

Halted payment of war debts by European

     nations

 

However, Hoover was considered a failure because:

      he refused to provide direct relief to the

           people

     of his insistence that the economy was

           improving when conditions were

           getting worse

     handling of the Bonus Army situation:

          

     when unemployed American veterans set

           up camp in Washington to

           demand early payment of their

           bonuses:

            Congress voted it down

           they refused to leave town

           Hoover called out the army to disperse

                the veterans

     opposed the “dole” or direct relief because

           he believed that relief would destroy

           people’s “rugged individualism”