Free Fighting the Great Depression Essay Sample
The Great Depression started in 1929 and ended in around the Late 1930's or early 1940's thereof. So it happened when Hebert Hoover was the president. Hoover accepted that the government had to attack the Depression. His failure to act vigorously was due to his personal philosophy of non interference by the government. He expected measures that were voluntary from the labor and the business people and the local people to offset the burden. He believed that the Depression was short lived and prosperity would be achieved in a short time. He believed the cause of the Great Depression was International and Americas debt to foreign countries. This contributed to him not acting enough and led to the electorate no voting for him in the next election and thus he was a one term president. To deal with the Great Depression President Hebert Hoover employed the following steps;
He emphasized on the importance of an international solution to the problem.
In the beginning of the Depression he held a number of conferences in Washington to secure the cooperation of business owners in ensuring the maintain wages and ensure the there is continued plant expansion. He pleaded with the labor force to accept part - time jobs so that the number of unemployed would not rise and people would stay on the payrolls.
In 1930 President Hoover asked Congress to avail funds to him for public works projects, He asked The American Congress to avail money to the government and local authorities to help in jobs creation. The governments lend money to. large corporation so that they cannot go bankrupt leaving a lot of Americans jobless.
A lot of individuals were in danger of losing their home because they could not afford to repay their mortgages, so to cushion these small individuals from losing their homes the Home Loan Bank Act of 1832 established Home Loan Banks, they were important in helping individual Americans not to lose their homes. This helped some Americans not to lose their homes.
Hoover also believed that international debt was one of the causes of the Great Depression so as a way of fighting the economic down turn; President Hoover declared a one year Moratorium in 1930 in the payment of war reparation payments by Germany to France and of the Allied countries to the United States of America.
President Hoover also to fight the Great Depression opposed the payment of war veterans' bonuses. The bonuses were for the World War One Veterans for their war time suffering. Every veteran was to receive a dollar for each day of their service of domestic service up to 500 dollars,
about 1.25 dollars every day for overseas to a maximum of 625 dollars. People with a lot of money owed to the government were issued with certificates which were to mature in 20 years time. The value of the certificates was $3.638 billion. Congress in supported the veterans service certificates to be paid but president Hoover opposed it claiming it will affect the depression relief programs. This led to the veterans marching to Washington with their families. The march and occupation of thousands of veterans and their families led the army to be used to remove on them from Washington with President Hoovers' order a move that led to some people getting injured and destruction of property.
President Hoover also signed into law the Norris-La Guardia Act(1932), this was occasioned by the plight of working citizens during the great depression. The legislation eliminated abuse of injunctions in Labor disputes. Before this employer would easily get injunctions from courts if Labor unions planned to strike, picket or boycott work. The injunctions made their efforts illegal.
By signing into law this Act, President Hoover empowered workers through their union for better bargaining of good working conditions and terms.
In 1929, President Hoover Authorized Repatriation program that was aimed at weeding out non citizens from America who were seen to be taking jobs from the Americans. The highest victims were the Mexicans who were moved to Mexico. There was a forced migration and about half a million Mexicans were affected. The intention of this program was to reduce the numbers of foreigners in America and ensure only Americans would get jobs rather than face competitions in the jobs sector from foreigners.
Before the Great Depression there was considerable economic prosperity in America, Hoovers Treasury Secretary, Andrew Mellon proposed and was later enacted numerous tax cuts which cut income tax rate from 73% to around 24%. Due to the Great Depression there was a sharp decline in incomes especially during the start of the depression. His caused a serious deficit of the federal government's budget. To increase federal revenue congress enacted Revenue Act of 1932 which was a huge increase in income tax. The taxes were increased across the board and the top earners were taxed at 63% on their net income. The tax also increased tax on companies and corporations from 12% to 13.75%. This was for the federal government to raise more money to finance its activities in the difficult time it was in.
In 1930, with the objection of many economists, the American congress approved and President Hoover signed into law the Smoot Hawley Tariff Act. In the legislation, imported goods tariff was raised this made imported good to be very expensive. The intention of the act was to encourage Americans to purchase locally produced goods. This would raise revenue to the government, create and sustain employments and protect farmers from lack of market for their produce. However due to economic depression in most of the World especially in industrialized European countries, the other countries due to lack of market in America also raised their Import tariff on American - made goods in response and protest. This had the effect of reducing international trade and worsened the economic Depression.
President Hoover believed in volunteerism as a method of aiding the economy, Hoover encouraged banks to provide loans. In 1931, President Hoover persuaded major banks to form a consortium as the Nations Credit Corporation (NCC). This consortium was to give loans to small banks to help them not collapse. The banks with the NCC usually required banks to provide collateral which was usually their largest asset. Thus many banks ended up not benefiting from this and many ended up collapsing. NCC was replaced by Reconstruction Finance Corporation.
The 1930 midterm elections were won by the Democrats, President Hoover was a Republican and this meant that the citizenry was not happy by the measure put forward by the government of President Hoover. As the depression continued to bite, it became clear that the republicans could not avoid blame for the bad handling of the depression and that all the democrat nominees would win the election.
In the 1932 election, President Hoover lost to Franklin D. Roosevelt, the democrats got landslide wins. The transition period for the two presidents left the country without a leader to deal with the depression; this created a lot of fear and uncertainty amongst the American public. The two presidents could not cooperate and always distrusted each other. President Hoover tried to commit Roosevelt into some financial policies Hoover thought they were necessary. But President Roosevelt refused to cooperate with President Hoover and did not disclose his plans until he was in power.
Though President Hoover tried to employ all the above measure to fight the great depression, he was not successful and it ended in the late 1930's or early 1940's, but the American people during the depression were faced by some of the following problems;
Unemployment and poverty, the unemployment in the US rose to 24.9% during President Hoover's leadership. These contributed to breakdown of homes due to lack of basic commodities which many families could no be able to afford.
There was also record school drop outs at rates of 2 to 4 million every year, this can be attributed to lack of fees to educate the children and also lack of hope for a better future.
The country also faced a lot of organized protests across the country as was the case of the world war veterans. Most of the protests were due to unbearable condition in the country like lack of jobs, homes and food.
The number of homeless citizens increased and they had no choice than to live in settlements of cardboards and paper shacks, they were popularly referred to "Hoovervilles" in reference to President Hoover.
Also farmers armed with guns marched to banks in fear of losing their money to prevent the closure of banks.
About 5,000 banks were closed in America.