hoover and depression

hoover and depression - 1c I. Hoover and the Depression It...

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1 c I. Hoover and the Depression – It was WWII that caused the end of the depression. Hoover was president during the depression. He was inaugurated in March and that October, the depression occurred. Hoover, and the Republicans, took the blame even though it wasn’t his fault. It was Republican policies that had created some of the problems. Hoover tried to address the problems of the worsening economy. He’s often identified as the first of the modern presidents because of his support for government action. Many in his administration, including Mellon, were telling him to not do anything but instead he encouraged the idea of government action in the economy. Mellon believed that the economy was like a rubber band (good and bad times) and that the government should not interfere. Mellon is arguing for Laissez Faire economics. Hoover broke from tradition and encouraged Congress to pass three specific acts of legislations. He supported the passage of all three of these acts that he hoped would bring the nation out of the decline it was experiencing. A. Emergency Relief and Construction Act – Congress appropriated millions of dollars to finance the works of public construction progress like dams in the west and the idea was that this would create jobs for the unemployed. It would restore purchasing power and it would help kick start the economy once again. It’s a program to provide jobs. B. Agricultural Marketing Act – A direct attempt by the Hoover administration to address the agricultural sector of the economy. Congress allows for millions of dollars to buy up surplus product like corn, wheat, and cotton that were flooding the market place and causing prices to decline. The idea was that the feds would purchase the product, store it, and to control what’s on the market so that the prices would rise. They wanted to affect farm prices by controlling the commodities on the market place. C. Reconstruction Finance Corporation – This was a very large congressional appropriation of money that would be loaned to some of the most important businesses and financial industries in the country. Money available in the form of loans to insurance companies, banks, and railroads would help provide economic stability. The belief was that once it was stabilized it would stabilize the overall economy. ~The problem was that this money was too little, too late and it wasn’t enough to make any substantial difference in the economy. It was a “Drop in the Bucket” compared to what was needed to stimulate the economy. Hoover did not support the idea of government providing relief, but he agreed with voluntary relief from individuals. He did not think it was the job of the federal government but instead it was up to churches, communities, and volunteers to help with the difficulties of the depression. Hoover would not accept any suggestions that the federal government would provide relief. Hoover was not for deficit spending, or spending money you don’t have. He was not able to put his mind around that
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hoover and depression - 1c I. Hoover and the Depression It...

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