The Great Depression, Part Seven

As the economy slipped and unemployment climbed, President Hoover tried to instill some confidence with the hope that consumers would spend, businesses would borrow and expand, and that this would lead to lower unemployment, and thus, to a reversal of the downturn. One of Hoover’s problems, however, was that when he made optimistic statements, and then the economy either didn’t improve, or slipped even further, his credibility, like the stock market, crashed. Certainly in any economic panic, and subsequent downturn, confidence is important, but there were serious structural problems in the American economy, and in fact, in the world economy, as I’ve already noted in the earlier parts.

In the midterm elections of 1930, Republicans retained control of both Houses initially, but by only one seat in the Senate and by two seats in the House. Several special elections were held prior to the House convening, and Democrats took control by four seats, and John Nance Garner became Speaker. To show how politically naïve Hoover could be, he considered asking Republican senatorial leaders to allow Democrats to organize the committees of the Senate, too, and thus the two parties would have a shared responsibility for bringing the economy back to health. Of course, this was all very absurd, as Republican committee chairmen and senior committee members would never have agreed to give up their powerful positions, nor would Democrats have been willing to take responsibility, and any blame, for the mounting economic mess that was occurring on the Republicans’ watch.

As I noted much earlier, Hoover, years before he was president, had been considering ways to lessen the effects of economic downturns in the business cycle. Hoover, and some others of that time period, considered deficit spending by government as a possible way of achieving some counterbalance to recessions/depressions, not necessarily feeling that such spending would actually or promptly end downturns, but that much economic hardship could be avoided, and that downturns could be minimized, and then the economy would recover and the upward march would continue. You have to remember, Hoover was something of a mixture of conservative and progressive. He supported Teddy Roosevelt’s (Progressive) Bull Moose Party earlier in the century, and he served in Democrat Woodrow Wilson’s administration. There’s no question that during the 1920s, while serving as Commerce Secretary for the Harding/Coolidge era, he got awfully close to business, and even to big business, as that was certainly a part of his job in that capacity, but he also made some less than favorable comments about the stock market and the speculative frenzy that seized Wall Street and the country in the latter part of the decade. A number of “Wall Streeters” made it clear that they preferred Coolidge to serve again, but when he bowed out, they had little choice, but to support Hoover. Hoover is also “somewhat known” for a statement about capitalism; and to paraphrase that statement, he said that there was a problem with capitalism, and that was capitalists, because they’re “too damned greedy!”

Deficit spending by the federal government cut against the grain of economic dogma of the time, and Hoover, misjudging the Depression as more a crisis of confidence, chose instead to try to provide confidence by balancing the federal budget, which, given the severe downturn, was by that time out of whack. So, Hoover the progressive now became Hoover the conservative, and it was this image that remained with him for the rest of his life, which was considerable, as he lived to be 90 years old, dying in late 1964.

The ranks of the unemployed grew so much that there were calls for federal aid to help individuals and families through the tough times. (It should also be remembered that many people who did have jobs had hours cut, even to the point where a good number were only part time employees.) Hoover, maintaining the federal system of separate national and state authority, saw “relief,” as it was called back then, as being a state responsibility, and in his defense, it had been just that. The system had worked before, but then again, we had never experienced such a dramatic economic collapse in the past. States, required to keep budgets in balance, were suffering from lost tax revenues and soaring aid expenses. Governors, politicians that they were, didn’t want to seem weak and ask for federal aid, so they seem to have assured Hoover that they had relief efforts well in hand. In fact, as time passed and unemployment grew to staggering heights, the states were overwhelmed, whether governors wanted to admit to it or not. Hoover promised federal aid, if requested by the states, and he assured the country that he didn’t want any citizen to go hungry, but for a man who had such a great reputation for feeding starving people, he seemed very out of touch with the situation. When the Mississippi River caused extensive and devastating flooding while Hoover was Secretary of Commerce, he went right to the problem areas and was given tremendous accolades for his involvement in helping people through the turmoil. During the Depression, Hoover could have gained further esteem by making appearances at food centers, and thus showing his concern for average people, and he would have seen, first hand, the situation that was developing. Then he could have made a decision about federal aid. We’ll never know, but such a demonstration “might” have bought him some political time and support. Again, he seemed not to understand the “big picture” of his image and what people wanted from a president in time of extreme crisis.

Hoover's opponents jumped on him for being against federal aid to help people weather the storm. Later in his term, he signed legislation putting the federal government into the relief business, but by then he received no credit, as he was seen as having opposed going down this road for so long. The federal budget continued to bleed red ink in an ever increasing amount.

WORD HISTORY:
Large-The ultimate origins of this word are unknown, but Latin had "largus," which meant "plentiful, abundant." This gave Old French, a Latin-based language, "large," with the same basic meaning, but with the secondary meanings "wide" (presumably from the notion of "abundant area") and "generous" (presumably from the notion of so much abundance, a person could afford to be generous). English borrowed the word from French in the late 1100s still with those meanings, but it wasn't long before the word came more and more to mean "big." With this meaning, "large" began to overtake "great" as the word to express "big," just as "great" had overtaken the native word "mickle/micel" which had this meaning (it still exists in dialect in England and Scotland). The expression "at large" apparently comes from the notion of being "free in the wide-open spaces."