Herbert Hoover: Recent Historians' Appraisals

(The author stresses that, except where indicated, the opinions expressed in this article are those of the historians cited — who, in many cases, are on the Left.)

I

Did Herbert Hoover’s departure from the White House in March, 1932, mean the end of an epoch in American politics? During the Roosevelt era, “liberals” sensed that Mr. Hoover was the epitome of laissez-faire — a doctrine which had its last fling in the 1920’s and ultimately brought disaster in its wake. In contrast, the New Deal came to symbolize a profound, but necessary, change in American social mores, replacing the outworn credo of unhampered free enterprise with an ethic of social responsibility. This view quickly passed into the folklore of Democratic propaganda.

Since the late 1940’s, however, most historical studies on Hoover tended to revise this thesis. In some cases the modification looked slight indeed; in others, it became total. One group of writings seemed closest to the standard theme. These studies identified Hoover as the apostle of a basically laissez-faire philosophy. Nevertheless, this “school” usually conceded that, during the Great Depression, President Hoover had to jettison many cherished free enterprise policies and employ unprecedented federal intervention. A second interpretation, perhaps the most popular among historians, viewed Hoover as always a transitional figure — neither a New Dealer nor a laissez-fairist, but an exemplar of an advanced “business” philosophy which by no means opposed all forms of State intervention.

Finally, a few writers liked to stress Hoover’s statism: his ties with the Progressives, distrust of the free market, or even his affinity with the New Deal. Some historians in this category differed only by degree from those in the second; but at least one writer pressed revisionism to its extreme and concluded that Hoover, not Roosevelt, founded the New Deal. Most studies in this last group appeared in the 1960’s.

II

With his chapter on Herbert Hoover in The American Political Tradition (1948), Richard Hofstadter offered the most comprehensive discussion of Hoover from an almost “traditional” standpoint. To those who still wondered why Herbert Hoover, self-made millionaire, engineer, and humanitarian, could become an inspiration to so many and then fall so rapidly from favour in the early thirties, Hofstadter had a clear answer: Hoover’s world and the philosophy which made it simply collapsed. To Hofstadter, “Hoover was the last presidential spokesman of the hallowed doctrines of laissez-faire liberalism and his departure from Washington marked the decline of a great tradition.” (1)

This traditional philosophy of self-reliance and free enterprise built the United States in the 19th century and caught the imagination of millions in that earlier time. By the 1929 Crash, this outlook was hopelessly outdated; yet Hoover continued to cling to it with a stubborn persistence that defied public opinion. The world groped for something more relevant than laissez-faire liberalism.

What accounted for the tenacity of Hoover’s “economic theology”? Perhaps the obvious fact that Hoover personified the self-made myth, rising as he did from humble birth to multimillionaire. Then too, Hofstadter noted, the system seemed secure: no serious recessions occurred from 1893 to 1929, and in the early years of the 20th century, the American people began to enjoy many positive economic benefits. Finally, the teachings at the universities — and certainly Hoover’s Stanford — inculcated laissez-faire orthodoxy.

Firm as Hoover’s economic credo supposedly was, Hofstadter conceded that he “had been a mild Bull Mooser in 1912.” Moreover, Hoover always advocated tariffs, became reputed as the “most liberal” of the Harding-Coolidge cabinets, and greatly expanded the Commerce Department. Later, as a Presidential candidate, Hoover insisted he did not propose laissez-faire. Still, any exceptions only proved the laissez-faire rule. If Hoover endorsed State regulation of business enterprise, he understood this form of control to be much milder than Federal intervention. And, “even as a bureaucrat in Washington he had made it his concern to prime the pump of private business initiative rather than play a paternalistic role.”

Confronting the Great Depression, however, Hoover finally made a distinct break with pure laissez-faire. Hofstadter admitted that Hoover took unprecedented steps to bring Federal initiative to bear on a domestic economic crisis. Through agreements with business and labour, he attempted to maintain wage-rates; eventually, he created a Federal mechanism to shore up the banking system — the Reconstruction Finance Corporation (R.F.C.).

But ingrained loyalties to the free market prevented Hoover from following a truly effective course of action. Convinced that the American economy was basically sound, he wasted time seeking out foreign sources of the Depression. When he brought himself to grapple with the domestic crisis, “…like a timid beast he shied away from any federal compulsion over business, when compulsion was necessary even to his own modest program.” This timidity eventually reached its summit when Hoover tried to hold back from appropriating Federal funds for unemployment relief.

Hofstadter judged that, out of office, Hoover resumed his role as laissez-faire spokesman. Supposedly, he built his entire career on the premise that “unmanaged” capitalism functioned smoothly. Destroying the premise meant destroying his public image. Therefore, in books and in speeches to Republican convocations, Hoover inveighed against economic planning and championed the traditional mythology: “Perhaps if we were…spartan enough …we might leap out of the fading world of the twentieth century and land in the one that flourished so brightly in Hoover’s mind.” (2)

Two years later, Harold U. Faulkner’s From Versailles to the New Deal gave readers roughly the same Hoover portrait that Hofstadter made. Faulkner observed that “Hoover was a humanitarian, but a devotee of classical economics.” (3) Again, he became an essentially laissez-faire liberal. During the Depression, however, Hoover sloughed off inaction and attempted a series of half-measures which were generally ineffective — though the R.F.C. proved an exception which the Roosevelt administration came to rely upon. (4)

By the mid-fifties, many historians attempted to reinterpret Hoover’s ideas and policies, but some representatives of the “Hofstadter school” remained unmoved. For example, in the June, 1960, issue of Current History, Victor Albjerg wrote that Hoover was “a nineteenth century whig in a twentieth century economy.” (5) This Jeffersonian advocate of limited government rigorously circumscribed what Federal aid he might offer — to farmers for example — by a stern adherence to laissez-faire principles. Albjerg also stressed that to Hoover, “the business cycle was a normal characteristic of American individualism as it applied to economics.”

So, when the Crash came in 1929, Hoover at first pledged commitment to the American “folklore” of non-interference. Such actions as increased public works, conferences on wage-rates, and the lowering of the rediscount rate merely reflected a desire to “ease” the evils of the panic. However, as the Depression wore on, the President began to take a more active course, establishing the R.F.C. to authorize Federal emergency loans. Albjerg concluded that Hoover, against the grain of his own convictions, abandoned laissez-faire and became a transitional president: his tenure marked a dividing point between non-interference and positive action. (6)

As late as 1966, another article, appearing in Ohio History, identified Commerce Secretary Hoover as a friend of laissez-faire. (7) Supposedly, Hoover’s dispute with Harding’s Secretary of Agriculture H. C. Wallace revealed an ideological clash. Wallace advocated the McNary-Haugen farm bill in order to give positive aid (export subsidies) to American farmers; but Hoover, “staunch opponent of measures to increase the role of government,” desired his own plan, which involved Federal support for private cooperatives. Of course, adoption of Hoover’s plan meant that Federal agriculture programs would come under the purview of Hoover’s own department. The Wallace-Hoover dispute came to an abrupt end when the former suddenly died in 1924. Nevertheless, Hoover could not put his program through until he became President in 1929.

III

Surprisingly — as he always displayed strong partisan support for the Democratic Party — Arthur Schlesinger, Jr., offered a more revisionist interpretation than the one presented above. In his Crisis of the Old Order (1956), Schlesinger saw Hoover as the prime spokesman for a “New Era” business creed. He contended that, by the twneties, prominent business leaders disclaimed against the “crude” individualism of an earlier day. The New Era philosophy emphasized social cooperation, service to the consumer, low prices and high wages.

Hoover emerged from his philanthropic missions to Europe imbued with the new gospel: “His return had precipitated in his mind a philosophy of American society….This philosophy animated the rest of his career.” (1) As Hoover explained, our American Individualism (1922) tempered itself with the ideal of service and equality of opportunity. Ideally it envisioned a business culture moving toward benevolent “cooperation” rather than blind competition. Hence, the American creed repudiated both strict laissez-faire and egalitarian socialism.

After the war and during the first years of his stay at the Commerce Department, Hoover tried to put his ideals into action. Schlesinger reserved special praise for Hoover’s interest in stabilizing the business cycle. Far from favouring a let-alone policy toward the economy, Hoover — through his special conferences — proposed a rather modern program of government “stabilization”: in periods of “slack”, government would finance extensive public-works projects by borrowing credit; during inflation, it would curtail the works program. Governor Brewster of Maine finally presented the plan before the National Governors Conference of 1928.

Still, despite some of the more advanced views of Hoover and his business colleagues, Schlesinger judged the American economy to be gravely ill in the twenties and in need of stronger aid than the New Era philosophers could muster. Productive capacity and production apparently continued to grow while sales outlets could not keep pace — consumers just didn’t have the buying power to purchase sufficient numbers of goods at the prices charged. Eventually, businesses with so much unsold production had to face severe losses — and this spelled depression on 1929.

Schlesinger concluded that only a massive attempt to reduce structural imbalances in the economy could have prevented disaster. Our society needed a strong labour movement to increase workers’ buying power, an activist program to stimulate farmers’ purchases and stepped-up progressive taxation to transfer wealth from the heavy savers to the active spenders. Therefore, the Republican policy of the twenties, which maintained unequal incomes, and the New Era theoreticians, who continued to think in business terms, had to prove inadequate to the task.

With this view of economics in mind, Schlesinger wrote that no President besides Hoover “could have provided a fairer test of the capacity of the business community to govern a great and multifarious nation….” When the Depression struck, Hoover rose to grapple with it, but he failed the test — and quite badly. Hoover initially put a variety of New Era principles to work. To preserve labour’s purchasing power, he conferred with leading industrialists and secured a series of agreements for the maintenance of current wage-rates and the expansion of investments. His Federal Farm Board also began to buy up surplus crops in an effort to raise farm prices. But the depression deepened and Hoover faced the choice of pressing for new government commitments or retreating.

Schlesinger advanced the thesis that in 1932 Hoover beat a hasty retreat to laissez-faire. Instead of stepping up new public works through deficit spending, Hoover became obsessed with a balanced budget, calling for tax increases and spending cuts. He also abandoned the operations of the Federal Farm Board and fought against Federal appropriations for direct relief.

What of the new program of 1932, the R.F.C., which seemingly contradicted laissez-faire? Schlesinger believed this was still a “Manchestrian” approach because it was designed to protect the banking system and, ultimately, the gold standard. Aside from his criticism of Hoover’s economic programs, Schlesinger also attacked Hoover for political insensitivity in both his reluctance to meet with labour representatives and in his handling of the Bonus March. (2)

Regardless of the supposed inadequacy of Hoover’s initial measures and despite the alleged return to a policy closer to classical liberalism, Schlesinger did not deny that Hoover greatly strengthened the powers of the Federal Government. He remarked, “Hoover breached the walls of local responsibility as had no other President in American history.”

Harris Gaylord Warren published his Herbert Hoover and the Great Depression in 1959, three years after The Crisis was released. His general assessment of the economy in the twenties paralleled Schlesinger’s strong opposition to the system; but Warren also took pains not to categorize Hoover as a mere partisan of laissez-faire. In addition, he plainly indicated that his criticisms of Hoover didn’t imply a pro-Roosevelt bias.

While Schlesinger described the stress on equality of opportunity in American Individualism, Warren explained the political implications of this concept. As Hoover saw it, government promoted opportunity when it protected the individual from political, social, or economic domination by any group. Warren noted that the government, to prevent such domination, was “to umpire and regulate, to encourage cooperation, and to coerce where necessary….” (3) All in all, nothing really new appeared in Hoover’s social philosophy except the boldness “with which he attempted to reconcile rugged individualism and individual responsibility.”

Warren — in contrast to Albjerg — demonstrated how Hoover’s concept of the Presidency was broad enough to grant considerable scope to executive action. He listed Federal programs which Hoover pushed for, such as waterway development, enlargement of national forests and parks, and conservation programs — for Hoover “did not believe in allowing individualism to be expressed through plundering the common heritage of natural resources.” The two and a half billion dollars spent on public works from 1930 to 1933 also (in large measure, at least) bore testimony to Hoover’s thinking. These projects came as part of a program of mild, beneficent reform, and yet they were thoroughly compatible with conservative Republicanism.

The arrival of the Great Depression rudely frustrated Hoover’s program, but the President quickly developed emergency plans “nicely calculated to create a broad pattern of action.” Basically, the anti-depression plan meant labour and industry cooperating to maintain wages and output, reforming banking and agriculture, keeping a balanced budget. The Federal Government might supplement relief expenditures to some extent, but aid for the unemployed had to remain the basic responsibility of private, state, and municipal agencies.

Like most historians, Warren judged Hoover’s measures unsuccessful because they did not go far enough; but he did not charge, like Schlesinger, that Hoover returned to laissez-faire. He praised the Farm Board as a departure in the right direction, but believed that Hoover did not use the coercive controls he knew to be necessary. He castigated Hoover’s relief philosophy and felt that it lost him the 1932 election. Further, in concluding his book, Warren claimed that Hoover would have become very popular had he really developed the New Deal policies; but then — those “did not stop the depression either.”

A more recent study on Hoover and the Depression, Albert Romasco’s The Poverty of Abundance (1965), stressed Hoover’s belief in “voluntaryism” (Romasco’s word). In contrast to unhampered laissez-faire or bureaucratic statism, this approach involved voluntary association on a scale massive enough to insure human welfare in a complex society. Labour unions, business trade associations, farmers’ cooperatives, and civic associations all promoted cooperation, yet operated in the private sectors. As the defender of voluntaryism, Hoover became the spokesman for “the new individualism — an individualism adjusted to the demands of modern conditions.”

Government assisted voluntaryism with education and public works programs and also by promoting foreign trade and conservation. In addition, whether through suasion or some modest aid, government put cooperative groups on a self-sufficient basis — and then retired from the scene. Some months before the Crash, Hoover launched the Federal Farm Board, which neatly embodied voluntaryist precepts: government was to help farmers establish their own cooperatives and thus gear up for mass production; the Board’s other provision — Federal purchasing of “surplus” crops to raise prices — remained in reserve for emergency use only.

When the financial panic hit, President Hoover employed voluntaryist suasion to prop up the economy. In the past, such panics scared businesses into cutting back on investments, slashing prices and wages, and dismissing workers. But, supposedly, these actions only spread fear and encouraged still more businesses to cut back. Hoover believed that if he could forestall the initial retrenchment, he might short-circuit the entire downward spiral. Therefore he moved promptly to get businessmen to freely refrain from curtailing projects and to maintain their work forces. At the same time, the Administration continually urged households to spend more, rather than hoard cash.

Romasco denied the effectiveness of the voluntary agreements on wages and investments: within two years, wages and output apparently dropped to startling lows, while unemployment sharply increased. Private charities and local governments, meanwhile, proved pathetically unable to meet the growing relief burdens. In short, Herbert Hoover seemingly pumped the “well of voluntaryism” bone dry during the first half of his tenure.

Voluntaryism gave way to more extensive coercion during Hoover’s last two years in office: the Federal Government assumed the responsibility of saving the financial structure and extending some indirect unemployment relief. Yet Hoover’s commitment to the traditional balanced budget hamstrung the new activist phase.

Nevertheless, in summarizing the entire range of Hoover’s efforts, Romasco wrote: since “the autumn of 1929 and during the next four years, the national government had broken away from the fatalism…of the past.” Though Hoover’s programs bore no fruit, they at least prepared the public for the New Deal’s “forceful use of federal power.”

Besides the books of Schlesinger, Warren, and Romasco, several articles published in the fifties and sixties discussed different aspects of Hoover’s alleged “voluntaryist” or “New Era” predilections. James Shideler, for instance, wrote about “Herbert Hoover and the Federal Farm Board Project” (1956) (5) and observed that Hoover began courting the farmers’ favour in the ’teens with articles on ways they could reduce costs and increase profits. Hoover later thought in terms of a “Farm Board” to parallel the Federal Reserve Board: this agency was to assist a farmers’ cooperative movement in the same way Hoover’s Commerce Department fostered business trade associations. Interestingly, in the early twenties, when Hoover backed legislation providing governmental assistance to farming cooperatives, many extant private cooperatives repudiated his efforts as paternal or socialistic.

In the Summer, 1967, issue of School and Society, Raymond H. Muessig outlined Hoover’s continuing interest in education. Commerce Secretary, it later turned out, advocated laws against child labour in order to keep children in school. Later, President Hoover sponsored several commissions dealing with the role of education in society: the National Advisory Committee on Education, which met in 1929 to study the relationship of the Federal Government toward education, and the Research Committee on Social Trends (1929), which prepared directives for Federal planning in education. Muessig believed that the Government would have followed through on these proposals had the Depression not intervened. But Hoover did convene the “Citizen’s Conference on the Crisis in Education” to help keep the public schools going in the midst of the economic collapse. Muessig wrote: “Conditions did not immediately improve in many areas, but it appears that the conference kept them from getting a great deal worse.” (6)

A year later, Ellis W. Hawley considered Hoover’s private and public memoranda on the “bituminous coal problem” of the twenties (Business History Review, Autumn, 1968). According to Hawley, overcapacity, chronic losses, and labour violence plagued the coal industry during Hoover’s years at the Commerce Department. To deal with part of the problem, Hoover initially proposed a government-sponsored statistical agency: presumably, publication of the (bad) business statistics would discourage small firms from entering the market, thus restricting production and raising prices. Smaller firms naturally fought this scheme.

Hoover later considered proposals for a long-term solution to the “coal problem”, one involving stable prices and harmonious labour relations. His ideas centered on unemployment compensation and voluntary arrangements to keep certain mines shut down during part of the year. Commenting on the nature of these plans, Hawley remarked that “Hoover was a transitional figure, an embodiment of a conflict in values” between laissez-faire and government control. (7)

Lastly, Gerald D. Nash’s “Herbert Hoover and the Origins of the Reconstruction Finance Corporation” (1969) (8), stressed that the R.F.C. was the brainchild of Eugene Meyer, rather than Hoover. The President, instead, wanted to maintain his “National Credit Corporation”, a quasi-“voluntaryist” agency which provided for wealthy private bankers to extend emergency loans to weaker banks. He did not adopt Meyer’s plan for a Federal corporation until December, 1931; yet Meyer had already drawn up legislation for such an emergency institution as early as 1929. Nash showed how Meyer based the R.F.C. on the World War I War Finance Corporation, an earlier example of emergency Federal intervention.

Footnotes

SECTION II

1 Richard Hofstadter, The American Political Tradition (New York, 1961, second edition), 286.

2 Ibid., other quotes, in order: 295, 295, 303, 313; and see also, 286, 294-295, 301-303, 313.

3 Harold U. Faulkner, From Versailles to the New Deal (New Haven, 1950), 64.

4 Ibid., see 365.

5 Victor L. Albjerg, “Hoover: The Presidency in Transition”, Current History, 39 (Oct., 1960), 214; additional quote, 216.

6 Ibid., and see 219 for conclusion.

7 Edward L. and Frederick Schapsmeier, “Disharmony in the Harding Cabinet: the Hoover-Wallace Conflict”, Ohio History, 75 (Spring/Summer, 1966), 126-136; quotes: 134.

SECTION III

1 Arthur M. Schlesinger, Jr., The Crisis of the Old Order (Boston, 1956), 82; additional quotes: 88, 246.

2 Ibid., see also chaps. 10; 11, 85-87; chaps. 9, 20, 25-26. (Actually, in charging Hoover with going back to laissez-faire, Schlesinger followed a course unique among the positions dealt with here. But it is still convenient to link him with the second group of historians.)

3 Harris Gaylord Warren, Herbert Hoover and the Great Depression (New York, 1959), 35. Additional quotes: 36; 65, 294, 295. See also: chaps. 2, 4, 19, 12, 13, 10.

4 Albert Romasco, The Poverty of Abundance (New York, 1965), 19. Further quotes: 231, 234; see also chaps. 1, 2, 6, 3, 7, 8, 11.

5 See James H. Shideler, “Herbert Hoover and the Federal Farm Board Project”, Mississippi Valley Historical Review, 43 (March, 1956), 710-729.

6 See Raymond H. Muessig, “Herbert Hoover and Education”, School and Society, 95 (Summer, 1967), 309-313; quote: 313.

7 See Ellis W. Hawley, “Secretary Hoover and the Bituminous Coal Problem,” Business History Review, 42 (Autumn, 1968), 247-270; quote: 248.

8 See Gerald D. Nash, “Herbert Hoover and the Origins of the Reconstruction Finance Corporation”, Mississippi Valley Historical Review, 56 (Dec., 1969), 455-458.

Frank Mintz was the editor of The Rational Individualist and holds a B.A. in history from the University of Maryland.