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President Herbert Hoover and the Great Depression

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  • 0:10 Ending the Great Depression
  • 0:40 Working Together
  • 1:39 International Approach
  • 2:45 Expanding the Government
  • 3:35 Opposition to Hoover
  • 5:02 Lesson Summary
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Lesson Transcript
Instructor: Adam Richards

Adam has a master's degree in history.

During his tenure, President Herbert Hoover attempted to end the Great Depression. Learn about his various policies in dealing with the economic collapse and their overall impact on the Depression in this video lesson.

Ending the Great Depression

With the onset of the Great Depression in 1929, President Herbert Hoover pursued various remedies aimed at reversing the course of the economic malady within the United States. While Hoover was partially responsible for contributing to the Depression, his attempts at curtailing the downturn were notable. Hoover's solution to the Great Depression included the policy of associationalism, an international resolution, and expanding the federal government. Unfortunately, it was not enough, as Hoover failed to end the largest economic collapse in United States history.

Working Together

Hoover's first attempt to reversing the economic tide in the nation was through the issuance of his policy of associationalism. This idea encouraged all individuals within the United States to begin working together to solve their common economic issues in the hope that smaller collaboration could provide a larger and permanent remedy to the Depression. Farmers, laborers, financiers and businessmen were expected to work in unison to aid the nation's recovery; not to mention, Hoover hoped that this banding of various personalities would lead to a renewed sense of national pride.

For associationalism to work successfully business owners had to adopt more liberal working conditions as well as improve payment to their employees. Farmers and laborers had to lower production in order to prevent the market from being flooded with goods, and bankers were encouraged to manage funds wisely and limit loan distribution. On paper, this was a noble concept, especially if the policy could usher in a positive zeitgeist. However, in reality, the mixture of personalities, backgrounds and general distrust proved to be unstable.

International Approach

Hoover owned a powerful reputation as an internationalist, especially after his major successes during the First World War. He thought a possible solution to the Depression was through the international community because he believed that the major aspects of the downturn were outside of American borders. Hoover first issued a temporary halt on loan payments owed by various European nations following the war. He also helped pass the Glass-Steagall Act of 1932, which expedited the ability of American banks to convert European investor's money into gold.

In an overly aggressive move, Hoover established protective tariffs, known as the Smoot-Hawley Tariff Act, or Tariff Act, to protect agricultural goods, balance the world markets and back the international gold standard. This precarious move proved to be futile and potentially worsened the Depression. The protective tariffs immediately limited trade with important overseas markets. Hoover called on increased production to break the inert economy, but in doing so, he prevented various foreign markets from selling goods in the United States. As a result, foreign nations issued tariffs that kept American goods from being imported. The overseas trade that was vital to the American economy came to a standstill.

Expanding the Government

At first, Hoover was against the expansion of the federal government. Yet, since many of his other ideas at rejuvenating the American economy had failed, he decided to approve limited-expansion measures. For instance, he approved the creation of the Reconstruction Finance Corporation to provide loans to various institutions that were willing to construct low-cost public facilities. Hoover took additional measures in financing home construction as well.

By 1932, Hoover was dismayed with the fact that the expansion of the federal government represented an unbalanced budget. In an effort to balance the budget, Hoover began eliminating federally created programs as well as supported the Revenue Act of 1932, which raised taxes on Americans. Hoover also limited the amount of federal assistance that was distributed to unemployed and suffering Americans since he believed that federal aid encouraged slothfulness, a lack of patriotism and a dependence on the government.

Opposition to Hoover

Many took exception to Hoover's failed attempts at ending the Depression and his denigration of those Americans who were suffering. Many liberals rejected the Hoover Administration outright and began looking toward Russia for advice and assistance. Many adopted proletarian literature and joined the Communist Party in the hope of bettering their situation. Homeless Americans began building cardboard cities, aptly naming them 'Hoovervilles.' Poor Americans who could not afford gasoline tied horses to their cars and called them 'Hoover wagons.' Those who were homeless and unemployed often walked around with their pockets inside-out; this was known as a 'Hoover flag.'

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