7. What Did Hoover Do?

Question 1

What did president Hoover do to combat the depression?

List 9 points

Answer 1

Removal of secretary Melon
Agricultural marketing act
Hawley-Smoot tariff 
Repudiation of war debts
Voluntarism 
Unemployment relief 
Federal Home Loan Bank Act
Reconstruction finance corporation 
War veterans and the bonus army

Question 2

REMOVAL OF SECRETARY MELON

Why and how was Melon removed?

Answer 2

• Melon was advising businessmen to fire their workers and sell everything
• Hoover removed him by sending him to London as an ambassador

Question 3

AGRICULTURAL MARKETING ACT
What year?
What did the act do? How much funds?
For example....
Was it successful?

Answer 3

AGRICULTURAL MARKETING ACT
1929
- Established the Federal Farm Board with funds of $500million to create ‘stabilisation corporations’ to organise farm surplus
EG the Grain Stabilisation Corporation, which brought wheat at 82 cents per bushel
- It did help, although encouraged farmers to produce more when they should produce less - also paid farmers artificially high prices which didn’t continue

Question 4

THE HAWLEY-SMOOT TARIFF
When was it passed?
How much did it charge?
Was it successful?

Answer 4

THE HAWLEY-SMOOT TARIFF June 1930

• Charged duties of up to 40% - the highest in American history
• It was unsuccessful - most Europeans abandoned free trade and even fewer US goods were being sold

Question 5

REPUDIATION OF WAR DEBTS

• Hoover blamed _______ for the depression, but actually _______
• This led to countries ________
• ______ were particularly affected by withdrawal of US credit and announced that _______
• What was the moratorium?

Answer 5

REPUDIATION OF WAR DEBTS

• Hoover blamed Europe for the depression, but actually, it was more likely that the US depression spread to Europe
• This led to countries REPUDIATING their war debts (ceased paying them)
• Germany were particularly affected by withdrawal of US credit and announced that it may have to refuse to pay - Hoover feared European war
• the MORATORIUM - in June 1932, Hoover announced that it would postpone collection of debts. However, it was too late to prevent the collapse of European economies

Question 6

VOLUNTARISM
What does this actually mean?
What did it encourage business men to do?
However….?

Answer 6

VOLUNTARISM
The notion that business and state government should solve the depression through their own voluntary efforts
- It encouraged business people not to cut wages or workforce, and state leaders to begin new programmes of public works
HOWEVER… The problem was just too great to be solved by voluntarism

Question 7

UNEMPLOYMENT RELIEF
- How much did congress give Hoover to help provide relief?
Hoover set up ________ but refused to give direct federal help because ________
He even refused to give direct federal help when _________. In the end, her offered a pitiful sum of ______ as a ______

Answer 7

• Hoover was given $500 million by congress to help agencies provide relief
• Hoover set up PRESIDENTS EMERGENCY COMMITTEE FOR EMPLOYMENT but refused to give direct federal help, arguing that it destroyed self-help and created a class of people reliant on government handouts
• He even refused to give direct help when much of the south were almost starving. In the end, he offered a pitiful sum of $47 million as a loan

Question 8

FEDERAL HOME LOAN BANK ACT
What did the act intend to do?
Was it successful?

Answer 8

• The act intended to save mortgages by making credit easier
• However, as the maximum loan was only 50% of the value of the home, it was largely inefficient. Another example of failed help because of the scale of the issue

Question 9

RECONSTRUCTION FINANCE CORPORATION
Undoubtedly Hoovers most radical measure to combat depression - a forerunner of the New Deal
- When was the RFC established, and what did they do?
- Where did most of the money go?
- Was it successful? Give examples

Answer 9

RECONSTRUCTION FINANCE CORPORATION
Undoubtedly Hoovers most radical measure to combat depression - a forerunner of the New Deal
- Established in January 1932, with authority to lend up to $2 billion to rescue banks, insurance etc
- 90% went to small or medium sized banks
- It wasn’t broad enough - only went out to a few eg. Central Republican National Bank and Trust took $90 million

Question 10

WAR VETERANS AND THE BONUS ARMY

• War vets were promised a bonus to be paid in _____ but when the depression hit _______
• A march was organised on ______ involving _____ people
• On that day, House of Reps voted to ______ the early payment
• Senate _____ this 2 days later
• Some ________ so Hoover employed the Secretary of war to _________ - who used ______ to get the job done
• Many were injured and _____ died.

Answer 10

WAR VETERANS AND THE BONUS ARMY

• War vets were promised a bonus to be paid in 1945 but when the depression hit they wanted it early
• A march was organised on June 15th 1932 involving 20,000 people
• On that day, House of Reps voted to allow the early payment
• Senate vetoed this 2 days later
• Some refused to move so Hoover employed the Secretary of war to forcibly remove them - who used tanks, infantry and tear gas to get the job done
• Many were injured and 2 babies died.