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Why Is President Hoover Responsible For The Great Depression

551 Words3 Pages

President Herbert Hoover is often blamed for the great depression for many reasons, he had ideas put into place that were meant to aid the problems in the economy but hurt it instead. Pro-labour policies made by President Hoover after the stock market crash of 1929 caused the majority of the nation's gross domestic product to decline over the next two years. This made what could have been a bad recession turn into the Great Depression. There were many reasons for the Great Depression, but the recession was worse than it would have been because of President Hoover. President Hoover worsened employment more than it would have been because he kept wages too high for firms to keep up, this made the total gross nation product decrease. Hoover's policy was an important event in causing the Great Depression. His policies on job-sharing and increasing wages were much of the reason for the decline. Hoover's attempts to fight the Depression were not powerful enough to defeat it. He believed too deeply in laissez-faire; where the economy fixes itself eventually. He seemingly did not try hard enough to mend it himself, because of this the economy suffered dramatically. The president was worried that the stock market collapse of 1929 would lead to recession and deflation, this would cause dramatic wage cuts and there was a probability of strikes if …show more content…

Many businesses acted accordingly to the presidents wishes, some even publicly broadcasted that they were complying with Hoover's ideas. The idea was supposed to soothe problems, but it did the opposite. After deflation set in, the value of wages increased. This led to workers getting raises during a time when firms were not able to afford the increases and productiveness was starting to decrease. This ended up increasing the price of labour and

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Many lost their jobs. Businesses were shutting down, Farmers were not able to grow their produce. Although there were several factors that came together to cause the Great Depression, the three main causes were buying on credit, stock market crash, and overproduction. Buying on credit helped cause the Great Depression because many Americans would buy goods that they cannot afford off installment buying. Installment buying is when you purchase a item with payments.

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The government should provide regulations on the economy to avoid economic failures such as the Great Depression. This article, titled “Two Presidents and the Depression” was written to describe how U.S. Presidents Herbert Hoover and Franklin D. Roosevelt handled the Great Depression in their own ways. When describing Hoover’s beliefs and how they influenced his actions, this article states how Herbert Hoover, “firmly believed in ‘trickle down’ and laissez-faire”. According to the textbook, Hoover had many laissez-faire policies while in office. Once Hoover left office and he became president, FDR made it his goal to get America back on its feet, and to do this he created the New Deal.

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 Hoover is often blamed for not doing anything to end the Great Depression, but he actually did try to use the government to create infrastructure projects, thus creating jobs. Like the Hoover Dam and the Reconstruction Finance Corporation to try to end the Depression. There are two major differences between their approaches.  One is that President Roosevelt was willing to do more than President Hoover to combat the Great Depression.  Roosevelt was willing to let the government become more involved in the economy.

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According to “Two presidents and the great depression” under the trickle down headline, “ Hoover now asked Congress at least to save the major economic institutions of the land: banks, insurance companies, railroads, etc. Congress responded by establishing the Reconstruction Finance Corporation and signed a bill authorizing $2 billion in spending in order to save businesses.” This shows that Hoover brought the actions to congress in order to save some businesses to help restore people’s confidence. According to “Two presidents and the great depression” Behind Hoover’s reluctance to spend federal dollars on the unemployed lay his belief in the need to keep the budget balanced. A deficit in the budget could be met only through levying more taxes and selling more federal bonds.

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Herbert Hoover’s presidency is associated with the Great Depression seeing that eight months into his term, the stock market collapsed starting an economic depression that would leave 23% of Americans unemployed by 1932. Hoover failed to take the actions needed to help the country initially, however in his annual speech to Congress in 1932, Hoover discusses three directions in which the government can take to aid the rebuilding of the economy. When the United States Stock Market crashed in October 1929 and the country began its ten year Depression, businesses and banks began closing left and right. This caused many Americans to lose their jobs and created massive amounts of poverty throughout the country. Prices became inflated and simple,

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These conservatives wanted the least amount of government efforts to improve the economy’s stability because Hoover was afraid that “federal relief would undermine self-reliance and encourage people to become more dependent on government handouts.” With the The Great Depression worsening, the unemployment rates kept increasing as

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economy plummeted into the Great Depression. He believed in a limited role for government and worried that excessive federal involvement posed a threat to capitalism and individualism. He vetoed several bills that would have provided relief to desperate Americans. Hoover shouldered much of the blame from the American people as he failed to realize just how severe the Depression had gone. He was viewed as insensitive toward the suffering of millions of Americans.

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This led to an economic decline and a never-ending cycle of decline in the United States. President Hoover was in office during this time, and not many were happy. Americans were looking for help from the government and not receiving anything. Americans felt as though Hoover wasn’t trying to help their situations. “I pledge you, I pledge myself, to a new deal for the American

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Laissez-faire ruling had been used time and time again by presidents but many people believe it lead to the downfall of the Great Depression. Coolidge made the economy too strong during his time as president. Companies began to expand more, and eventually they were making more products than they were selling. Companies had to cut jobs to compensate for the over production but this had people fearing they would loose their jobs so they started saving more money. Companies began to sell even less product than before which many believe less us to the Great Depression.

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