Although President Herbert Hoover is generally known for doing little to help the U.S. economy during his presidency, he did implement several programs. These are three examples:
1) The creation of the Reconstruction Finance Corporation (RFC) in 1932 which secured loans for various businesses, famers, and infrastructure projects. This was a small program during Hoover’s last year in office and contrary to Hoover’s stated belief against government interference.
2) The Smoot-Hawley Tarriff Act imposed high tariffs on many imported goods, and was meant to increase American production of goods.
3) The creation of the National Credit Corporation (NCC) in 1931 was Hoover’s attempt at create a voluntary board composed of bankers and insurance executives in order to secure failing banks. The NCC received $500 million in government funds but proved to be unsuccessful, largely because the banks never fully supported the idea and because the NCC was voluntary.
President Hoover believed in a laissez-faire philosophy when it came to dealing with the economy. Thus, when the Great Depression began, President Hoover believed things would work themselves out. As a result, he did very little to try to deal with the Great Depression.
Eventually, President Hoover reluctantly came to the conclusion that more direct action was necessary by the federal government. There were three programs he initiated to try to help deal with the effects of the Great Depression. One program was the creation of the National Credit Corporation. This program gave money to banks that were experiencing some financial difficulties so these banks could continue to make loans that would help businesses in those communities invest in the economy.
Another program that President Hoover created was the Reconstruction Finance Corporation. This program gave loans to banks, businesses, and farming groups in the hope that these loans would help stimulate the economy. Unfortunately, the economic slide continued.
In 1932, a law was passed called the Emergency Relief and Construction Act. This law provided direct help to individuals by giving them loans and government jobs. Many public works projects began because of this law. Unfortunately, it didn’t help to end the Great Depression.
President Hoover’s reluctance to act earlier and the limited number of programs he initiated were factors in his defeat for reelection in 1932. We were in the midst of our worst depression ever, and the American people decided it was time for a change in leadership and a change in philosophy.