Which president was elected with the promise that he would do something about the great depression?

The 1920s were a period of optimism and prosperity – for some Americans.  When Herbert Hoover became President in 1929, the stock market was climbing to unprecedented levels, and some investors were taking advantage of low interest rates to buy stocks on credit, pushing prices even higher.  In October, 1929, the bubble burst, and in less than a week, the market dropped by almost half of its recent record highs.  Billions of dollars were lost, and thousands of investors were ruined.

After the stock market crash, President Hoover sought to prevent panic from spreading throughout the economy.  In November, he summoned business leaders to the White House and secured promises from them to maintain wages.  According to Hoover’s economic theory, financial losses should affect profits, not employment, thus maintaining consumer spending and shortening the downturn.  Hoover received commitments from private industry to spend $1.8 billion for new construction and repairs to be started in 1930, to stimulate employment.

The President ordered federal departments to speed up their construction projects and asked all governors to expand public works projects in their states. He asked Congress for a $160 million tax cut while doubling spending for public buildings, dams, highways, and harbors.

1930

Praise for the President’s intervention was widespread;  the New York Times commented, “No one in his place could have done more. Very few of his predecessors could have done as much.”  Together, government and business spent more in the first half of 1930 than in the entire previous year. Still consumers cut back their spending, which forced many businesses and manufacturers to reduce their output and lay off their workers.

In October 1930, with unemployment rising, Hoover created the President’s Emergency Committee for Employment (PECE) to coordinate state and local relief programs, and to develop methods for increasing employment in the private sector.  But with no direct control of funding for relief or jobs, PECE had only limited success.

As the Depression worsened, Hoover requested that the Federal Reserve increase credit, and he persuaded Congress to transfer agricultural surpluses from the Federal Farm Board to the Red Cross for distribution to relief agencies. Hoover asked Congress for even more spending on public works, and he continued to encourage states and private businesses to generate new jobs.

1931

Economic conditions improved in early 1931 until a series of bank collapses in Europe sent new shockwaves through the American economy, leading to additional lay-offs.  In August 1931, PECE was reorganized as the President’s Organization on Unemployment Relief (POUR). POUR expanded on PECE's work but also implemented a national fund drive for unemployment relief.  The national fund drive raised millions of dollars but proved to be woefully inadequate as unemployment soared to record levels.

Hoover was criticized for almost every program he proposed.  His public works projects, designed to create jobs, were characterized as wasteful government spending.  His efforts to promote local relief programs, rather than asking Congress to create nationwide relief programs, were viewed as callous disregard for the unemployed.

1932

On January 22, 1932, Hoover established the Reconstruction Finance Corporation (RFC) to make emergency loans to businesses in danger of default.  At first the RFC lent money only to banks, railroads, and certain agricultural organizations, but the scope of its operations was later expanded, and it proved to be an effective tool for stabilizing business and industry.  In July 1932, Hoover signed into law the Emergency Relief Construction Act, which allowed the RFC to lend $300 million to the states for relief programs and $1.5 billion for public works projects.  Hoover also persuaded Congress to establish Federal Home Loan Banks to help protect people from losing their homes.

By the summer of 1932, the Great Depression had begun to show signs of improvement, but many people in the United States still blamed President Hoover.  With the Presidential election approaching, the Democratic candidate, New York Governor Franklin D. Roosevelt, exuded hope and optimism, and promised the people a "New Deal."  Hoover, defending his record, came across as pessimistic and defeated.  In November, Roosevelt won in a landslide.

1933

Four long months intervened between the election and Roosevelt's inauguration. Economic signs that had looked so promising in the summer of 1932 trended downward, unemployment went up, and banks failed at an alarming rate.  As weak banks closed their doors, nervous depositors began withdrawing cash from even the soundest banks, but Congress refused to enact Hoover’s plans to stem the panic.  When Roosevelt was inaugurated on March 4, 1933, the banking system was near total collapse, and unemployment had reached 25%.  Within days, Congress passed and FDR signed into law the Emergency Banking Relief Act, which stemmed the panic and restored confidence in the financial system – and was almost identical to legislation Hoover had proposed weeks before.  Despite all the efforts of Roosevelt's "New Deal," the Depression persisted seven more years, until World War II stimulated the economy with increased demand for commodities and war materials.

1. Early Years
2. Humanitarian Work
3. The Great Depression
4. Post-Presidential Years

Herbert Hoover (1874-1964), America’s 31st president, took office in 1929, the year the U.S. economy plummeted into the Great Depression. Although his predecessors’ policies undoubtedly contributed to the crisis, which lasted over a decade, Hoover bore much of the blame in the minds of the American people. 

As the Depression deepened, Hoover failed to recognize the severity of the situation or leverage the power of the federal government to squarely address it. A successful mining engineer before entering politics, the Iowa-born president was widely viewed as callous and insensitive toward the suffering of millions of desperate Americans. As a result, Hoover was soundly defeated in the 1932 presidential election by Democrat Franklin D. Roosevelt (1882-1945).

Early Years

Herbert Clark Hoover was born on August 10, 1874, in West Branch, Iowa–the first U.S. president to be born west of the Mississippi River. He was the second of three children in a family of Quakers, who valued honesty, industriousness and simplicity. His father, Jesse Clark Hoover (1846-80), worked as a blacksmith, and his mother, Hulda Minthorn Hoover (1848-84), was a teacher. Orphaned at age nine, Hoover was raised primarily by an uncle in Oregon.

Did you know? On March 3, 1931, President Herbert Hoover signed a law that made "The Star-Spangled Banner," based on an 1814 poem by Francis Scott Key (1779-1843), America's national anthem.

After attending Quaker schools, Hoover became part of the first class to enter Stanford University when it opened in 1891. He graduated four years later with a degree in geology and launched a lucrative career as a mining engineer. Intelligent and hardworking, Hoover traveled all over the world to find valuable mineral deposits and establish business enterprises to extract the resources. His work made him a multimillionaire. On February 10, 1899, Hoover married his college sweetheart, Lou Henry (1874-1944), and the couple had two sons, Herbert (1903-69) and Allan Henry (1907-93).

Humanitarian Work

At the start of World War I (1914-18), Hoover dedicated his talents to humanitarian work. He helped 120,000 stranded American tourists return home from Europe when the hostilities broke out and coordinated the delivery of food and supplies to citizens of Belgium after that country was overrun by Germany.

When the U.S. entered the war in 1917, President Woodrow Wilson (1856-1924) appointed Hoover head of the Food Administration. Hoover encouraged Americans to reduce their consumption of meat and other commodities in order to ensure a steady supply of food and clothing for the Allied troops. 

Once the war ended, Hoover, as head of the American Relief Administration, arranged shipments of food and aid to war-ravaged Europe. He earned worldwide acclaim for his humanitarian efforts, as well as thousands of appreciative letters from people across Europe who benefited from the free meals known as “Hoover lunches.”

Hoover’s success earned him an appointment as secretary of commerce under President Warren Harding (1865-1923), and he continued in this position under President Calvin Coolidge (1872-1933). During the fast-paced modernization of the 1920s, Hoover played an active role in organizing the fledgling radio broadcasting and civilian aviation industries, and also laid the groundwork for the construction of a huge dam on the Colorado River between Arizona and Nevada. (Named after Hoover, the dam opened in 1936.)

The Great Depression

In the U.S. presidential election of 1928, Hoover ran as the Republican Party’s nominee. Promising to bring continued peace and prosperity to the nation, he carried 40 states and defeated Democratic candidate Alfred E. Smith (1873-1944), the governor of New York, by a record margin of 444-87 electoral votes. “I have no fears for the future of our country,” Hoover declared in his inaugural address. “It is bright with hope.”

On October 24, 1929–only seven months after Hoover took office–a precipitous drop in the value of the U.S. stock market sent the economy spiraling downward and signaled the start of the Great Depression. Banks and businesses failed across the country. Nationwide unemployment rates rose from 3 percent in 1929 to 23 percent in 1932. Millions of Americans lost their jobs, homes and savings. Many people were forced to wait in bread lines for food and to live in squalid shantytowns known derisively as Hoovervilles.

Hoover undertook various measures designed to stimulate the economy, and a few of the programs he introduced became key components of later relief efforts. However, Hoover’s response to the crisis was constrained by his conservative political philosophy. He believed in a limited role for government and worried that excessive federal intervention posed a threat to capitalism and individualism. He felt that assistance should be handled on a local, voluntary basis. Accordingly, Hoover vetoed several bills that would have provided direct relief to struggling Americans. “Prosperity cannot be restored by raids upon the public Treasury,” he explained in his 1930 State of the Union address.

Post-Presidential Years

The Depression worsened throughout Hoover’s term in office, and critics increasingly portrayed him as indifferent to the suffering of the American people. By the time of the 1932 presidential election, Hoover had become a deeply unpopular–even reviled–figure across much of the country. Carrying only six states, he was soundly defeated by Democratic candidate Franklin D. Roosevelt, the governor of New York, who promised to enact a slate of progressive reforms and economic relief programs that he described as a New Deal for the American people.

After leaving office, Hoover emerged as a prominent critic of Roosevelt’s New Deal programs. He wrote articles and books outlining his conservative political views and warning about the dangers of investing too much power in the federal government. Hoover returned to public service in the 1950s, serving on commissions aimed at increasing government efficiency for presidents Harry Truman (1884-1972) and Dwight Eisenhower (1890-1969). 

By the time Hoover died at age 90 on October 20, 1964, in New York City, assessments of his legacy had grown more favorable. Noting that after Hoover left the White House the Great Depression continued for eight more years despite Roosevelt’s active intervention, some historians have argued for a more sympathetic appraisal of Hoover’s presidency.