Herbert Hoover and the Great Depression

Contributor: Nathan Murphy. Lesson ID: 13707

Hoover was president at the beginning of the Great Depression, and the American people were counting on his response to fix the economic collapse. Was it effective? How is he remembered? Find out!

categories

People and Their Environment, United States

subject
History
learning style
Auditory, Visual
personality style
Lion
Grade Level
High School (9-12)
Lesson Type
Dig Deeper

Lesson Plan - Get It!

Audio:

In 1928, Herbert Hoover was elected in a landslide victory. However, only four short years later, he lost in a landslide to Franklin D. Roosevelt.

  • What led people to vote Hoover into office by such a wide margin in 1928?
  • What could have happened in four short years to convince those same people that original landslide victory was a mistake?

Examine these questions and more!

Early Years

Herbert Hoover led an extraordinary life before he was elected to the presidency.

Hoover childhood home

Orphaned at the age of nine, he was sent 2,000 miles away to live with an uncle. His work ethic and drive led him to Stanford University and, later, across the Pacific Ocean to manage gold mines.

By his late twenties, Hoover was living in China, where he worked for a mining company as well as the Chinese government. He even learned Mandarin!

After years of rising up in the mining industry, he retired to London where he could manage his assets from afar.

During World War I, when Germany invaded Belgium, the Germans did not think it was their responsibility to feed the occupied peoples. As a result, Hoover took it upon himself to negotiate with countries from both sides of the war to provide food for the eight million people in Belgium.

This gained Herbert Hoover the title of The Great Humanitarian.

Hoover in 1919

Watch a portion of The real Herbert Hoover, from CBS Sunday Morning, to see first-hand how remarkable Hoover's early years were:

With this fame, Hoover was hired to be an advisor to President Woodrow Wilson to help guide negotiations at the Paris Peace Conference at the end of World War I.

Roaring '20s

During the 1920s, both Republican presidents, Warren G. Harding and Calvin Coolidge, had Herbert Hoover on their cabinets as the head of the Department of Commerce.

In the past, this cabinet position was rather weak without much control. Herbert Hoover, however, changed it into something much more, even creating sub-departments that took over functions from other departments if their secretaries were not doing a good job.

During his tenure as Secretary of Commerce, he made it his mission to standardize everything in the country.

Look at this slideshow of the things that were standardized directly as a result of Herbert Hoover in the 1920s:

The spirit of standardization existed throughout Hoover's service in the Department of Commerce, and he did a great deal to shape the world we know today.

  • Can you imagine if cities did not have a set traffic light color for stop and go?

It is more than likely someone else would have standardized this and other areas eventually. However, by standardizing as much as possible across the country when he did, Hoover was able to revolutionize consumer safety and value.

Hoover was also able to drastically reduce waste. Coming out of World War I, the ability to universally reuse milk bottles and reduce the amount of aluminum needed for cans was incredibly valuable.

1928 Time Magazine cover

Image by Time Magazine, via Wikimedia Commons, is in the public domain.

By the time Herbert Hoover ran for president in 1928, he was one of the most famous and well-respected Americans of the time. It seemed natural, then, that nearly the entire country would vote for him.

Presidency

During Hoover's first year as president, the United States' free-market and deregulated economy continued to do well. It was easy to operate a business within the country, tariffs were very low, and the stock market continued to rise.

However, this deregulation allowed wealthy individuals to invest more and more into stocks, causing many to rise far above their true value. The goal was to avoid a stagnant economy, which might scare average Americans and cause them to pull out of the market entirely.

In October 1929, however, on a day that became known as Black Tuesday, the New York Stock Exchange faltered, causing an economic depression.

economic crisis

As a free-market Republican, Herbert Hoover did not believe it was the role of the federal government to intervene in people's lives. This was not because he did not want to help people. Rather, he feared doing so would undermine their freedoms and liberties. Instead, he wanted to allow them to help themselves.

After Black Tuesday, Hoover encouraged business leaders to not reduce wages or hours and to continue operating their businesses as if nothing had happened. He also asked private companies, like railroad, to begin planned expansions and renovation projects immediately to provide jobs for people who were newly unemployed.

Hoover thought this economic depression could be resolved by private industry and would only last a year at most.

By early 1930, it became obvious the U.S. government would need to intervene in some capacity. So Hoover established the Federal Farm Board and provided $100 million in federal funding to purchase large quantities from suppliers in an attempt to stabilize prices.

Federal Farm Board, 1929

Image from the National Photo Company, via the Library of Congress, has no known restrictions on publication.

Hoover also raised tariffs on other countries in an attempt to encourage Americans to purchase goods exclusively from inside the country.

Programs like the Federal Farm Board caused the federal government to run up a deficit. While many felt the only way to manage an economic downturn was to balance the budget and ride it out, others felt it was necessary to spend even more than Hoover already was no matter how high the deficit became.

Despite Hoover's attempts, the unemployment rate reached 23% by early 1932. He had no choice at this point but to agree to provide loans insured by the U.S. government to banks and railroads in order to help struggling businesses.

By the time his re-election arrived, Herbert Hoover did not stand a chance against Franklin Roosevelt, a man whose campaign promised help to all Americans.

Ironically, Hoover's economic policies were viewed as the most extreme in U.S. history until Roosevelt came into office.

Roosevelt, 1940

Image from the FDR Presidential Library, via Flickr, is licensed under the CC BY 2.0 license.

Post-Presidency

Herbert Hoover's reputation was forever scarred by the Great Depression; however, it was the very policies he established that Roosevelt utilized to dig the country out of economic depression.

Hoover and FDR en route to 1933 inauguration

Image from Library of Congress' Prints and Photographs Division, via Wikimedia Commons, is in the public domain.

While Hoover had been wary of extreme deficit spending, Roosevelt simply pumped more money into the framework Hoover had established.

Instead of asking businesses to build projects, FDR created a federal agency that hired men to build infrastructure. Instead of the Farm Board, FDR directly subsidized all the crops farmers in the country produced.

Continue on to the Got It? section to further analyze the true legacy of Herbert Hoover's presidency.

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