Download Causes of the Great Depression

Hard Times and
the Failure of
Hoover
Poverty Devastates Rural America
 Part
of the problem facing farmers was the overuse of the land in the Midwest. Loose soil,
compounded by drought and high winds led to
the Dust Bowl– an area where dust storms were
common.
 States
affected included Texas, Oklahoma, Kansas
New Mexico and Colorado.
Poverty Devastates Rural America
Poverty Devastates Rural America
 Many
farmers were forced to abandon their
farms. Some chose to become tenant farmers,
and work for a larger farmland. Others chose to
leave the Midwest altogether, mainly for
California.
 These
individuals were known as Okies– although not all
were from Oklahoma.
 The plights of these migrant farmers were chronicled in
John Steinbeck’s 1939 novel– The Grapes of Wrath.
Cautious Response to Depression Fails
 When
Americans looked to Hoover to solve the crisis of the
Great Depression, he did not immediately jump into
action.
 In the beginning, Hoover adopted a hands-off policy
because he felt the economic cycle would correct itself.
 However, to appease public opinion, Hoover then
adopted a policy of volunteerism in which businesses
and industrial leaders agreed to keep wages, prices and
employment at current levels.
 In return, they would be given money by the
government.
Cautious Response to Depression Fails
 But
this policy relied too much on voluntary cooperation–
something which most businesses were not willing to do.
 So, Hoover instead turned to a policy of localism, in which
state and local governments would provide jobs.
 But, this did not work because the governments did not
have the funds, and Hoover refused to help them.
 Instead, he believed in “rugged individualism” where
people should better themselves through their own
efforts.
Hoover Adopts More Activist Policies
 The
American public associated the President’s name
with suffering, so eventually Hoover had to get the
government involved.
 He urged Congress to create the Reconstruction Finance
Corporation (RFC) to provide loans to railroads, big
businesses and banks. By doing so, they would employ
more workers and production and consumption would
increase again.

This theory was known as trickle-down economics– the more
wealth at the top of society, the more that was available to
‘trickle-down’ to the poor.
Americans Protest Hoover’s Failures
 Although
Hoover was working hard to end the
depression, to the everyday American, it was not
enough.
 Some Americans proposed radical change to
correct the economy– a rejection of capitalism
and instead adopting socialism or communism.
 They saw capitalism as creating inequalities
within American society.
Americans Protest Hoover’s Failures



Although most Americans did not favor radical change, most did
want SOMETHING to change.
One group included WWI veterans who had been promised bonuses
paid to them in 1945.
 Because of the depression, though, they wanted their money in
1931.
 Congress had passed a bill allowing the early payment, but
Hoover vetoed it. They marched on the White House to demand
early payment.
 Hoover ordered Douglas MacArthur to ‘clear out’ the Bonus Army
because he feared violence. However, MacArthur took excessive
force on the Bonus Army, using sabers and tear-gas.
From that point on, Hoover was doomed in the eyes of the public.
Closing Question
How
did the American public react to the
worsening Depression? What steps did
Hoover take to end it?