The year was 1929. This is the start of the biggest national crisis since the civil war. It was the Great Depression. The stock market was going in a slump that started in October. By the end of Hoover’s term in office unemployment rates had sky rocketed and left 12 to 14 million without jobs, and the supply of money was scarce and only getting worse.
There are many reasons that the Great Depression started. One of the most well known causes is the stock market crash that happened on October 29, 1929. Before this day the stock market had grown considerably, making companies profits go up. General Electric had tripled in value which came out to about $396 per share of stock. After October 29th, 1992 many business lost thousand of dollars, money that had just seemed to vanish into this air, never to be seen again. The stock market crash was followed by many cuts that had to be made by businesses concerning how many workers they could have and how much to pay the workers that they could keep. Since companies could not afford to keep many of its workers and actually pay them, Hoover ordered federal departments and head of the government of organization for construction processes to be sped up to make more rooms for jobs for the unemployed. After the shock had passed Hoover announced that the worst was over and that unemployment rates were starting to get back on track. Little did he know that at that time unemployment was the only thing getting back on track for the United States. Another reason for the start of the Great Depression was overproduction. Many companies made too many products and people did not have the money to buy the products to get businesses back the money that they spent making that product, so businesses lost a large amount of their money by overproduction.
After seeing that the depression was getting worse he realized that he had to do something to try and stop it from growing out of hand. It was well into the Great Depression that Hoover realized that the depression was not going away on its own. He was going to have to think of some ways that he could try to help the depression disintegrate. In a speech that was given by Hoover not long after he realized this he said, “Our people deeply troubled, not only by the turbulent world around us, but all our internal problems which haunt our days and nights.” Hoover gave this speech to Americans when he let it be known that he knew that the depression was getting out of hand and that he, as the country’s president, was going to do something in way of helping Americans get through the depression. He knew that Americans had become deeply troubled about what would happen as the depression worsened and that worry caused Americans to have social problems and become very stressed out. The depression caused many families to have family problems that started with the loss of jobs and the lack of money. In this quote he is saying that the worries that people faced from the depression caused emotions to haunt people and bring turmoil into their lives day and night.
At the beginning of his term he opposed any relief efforts to try and help the people suffering from the depression. As the depression kept getting worse he decided to start a few farm assistance programs to help farmers out with the situation of extremely low crop prices that they were facing. These assistance programs consisted of mainly making it easier for the farmers to obtain loans to keep their crops going even though they were not making money off of it. By the time that he had introduced the new ideas to farmers to keep their farms up and running the farmers had become to dependent of the financial aid being handed out to them by the federal government. Hoover then started federal work projects such as the Coulee Dam and the Hoover Dam, which provided many jobs for people, but the Great Depression was much bigger than a few extra job openings could fix.
Some major mistakes that Hoover made with his effort to get the United States out of this economic slump that the American people were facing was he raised tariffs. He hoped that by raising tariffs he would help American businesses. He created the Hawley-Smoot Tariff but ended up making the economy worse than it already was by causing lower export rates. His biggest mistake was that he would not go off the gold standard. He believed that if our money were not backed up by anything it would be worthless and that the United States would have bad credit. He did not want the United States, under any circumstances to be in debt. He thought that by messing with the national debt he would only be prolonging the depression and making it worse since the federal government would have to pay interest on loans. Hoover wanted to wait and think. He wanted to make sure that the programs he provided money for would definitely work. He did not want to spend more money than he had to, and in doing that, he raised the national debt more than it was.
His view on unemployment was that the government should help out businesses and then help given to them would “trickle down” through the system and eventually helps the people. Hoover thought that helping the big business get back on their feet again would be the best way to involve every person in the United States in his plan to stop or slow down the depression. To help the business he recommended to Congress that they start the Reconstruction Finance Corporation. This would supply business, such as banks, farm organizations, insurance companies, rail roads, and state, county, and city governments with money to help their economic activity and in return making jobs for the unemployed to have. By getting more jobs out there for the people he would be helping to stifle the money loss that comes in after losing a job and in return would help stop the depression. Hoover thought that organizations a local level could help the people best.
Hoover’s administration had a great effect on the Great Depression. He tried to put many organizations in affect that could help the victims of the Great Depression. Many people say that it was a good effect and many others say that all he did was make the depression worse. Even though he did mess up the national debt he did some good things for business, farmers, and unemployment rates he was still an effective president to have during the depression. Hoover set the stage for Franklin Roosevelt to come in and finish what he started. Hoover at least made an effort to try and get America out of the depression, but he was a man of strong character who was set in his ways like stone. He did not want to risk anything new to help the country foe fear of messing up the economy for Americans in the United States worse than they already were. Today, he is not known for the good that he did to try and help the people that lived in the time period of the Great Depression, but is known for what he did not do to help the people who lived in the time period of the Great Depression.