Prior to reading Panic, I believed that Hoover was
responsible for the Great Depression. However, David Kennedy, the author,
blames Calvin Coolidge, Herbert Hoover's predecessor. Coolidge stated, “the
Business of America is Business".
He was a very inactive president and was known to ignore problems as
long as possible as 9 of 10 of them were resolved before the American public
had to worry about them. Hoover was a member of the Progressive Movement and
felt the Federal government needed to help combat unemployment through public
works.
After the crash and through 1930 Hoover tried to use four
forces to combat the steadily worsening Great Depression
1. Convince the Federal Reserve to reduce rates. There was
conflict caused by the independence of the Federal Reserve and the governors’
disagreement with Hoover.
2. He jawboned industry to maintain wage rates to encourage
consumption. However, this only worked temporarily.
3. He used the Farm Board (created by Congress at his
request as a result of a deep agricultural recession in the late 20's) to help
support agriculture prices. Unfortunately, the Farm Board had also created
crushing tariffs that went against the long term interests of the country. Additionally,
the Farm Board wasn't capitalized with enough money to be useful.
4. He fought for stimulating public construction projects.
Because of the small role of the government, there were only about $200 million
to spend on construction projects to help boost the economy.
This relates to today’s Tea Party since they are proponents
of small government and desire to return to traditional America. The judiciary
were activists on the conservative side supporting industry's union programs of
contracts, forcing laborers to agree to never join a union. There was no social
security, no unemployment help, and no available resources for the workers.
People worked 12 hours a day, six days a week. The few child labor laws in
existence were weak.
I found Cootlidge's perspective really interesting because in Ashwin's post (see link: http://ushaplahs2013.blogspot.com/2013/11/presidents-of-roaring-twenties.html) it said that he was stern, honest, moral, industrious, and a frugal New Englander yet I thought that moral people usually did what was right and I don't think that waiting for the Great Depression to happen was a moral thing to do.
Great opinion post Brittaney. I agree with a lot of your points.
ReplyDeleteI don't know if one can necessarily call President Coolidge a bad president although he didn't prevent the Great Depression from burdening President Hoover's presidency. However, it is widely accepted that President Coolidge's avoidance of the scandalous Harding administration(which was actually good for people and what people wanted) to give more money to the consumers and the businesses was a bad approach. He tried to lean towards the laissez-faire based economy which led to over-speculation that eventually brought on the stock market crash of 1929. Could President Coolidge have prevented the crash? Well, that's something to think about.
Britney, that is a really interesting post you have created. I never really though that any president was responsible for causing the Great Depression, but more so responsible for prolong the Great Depression (e.g. Roosevelt's New Deal) and not bring swift enough economic and social revival. Joanne, as for your question I honestly think that Coolidge could have not prevented the crash as the stock market crash was a symptom of the Great Depression, which was cause by a number of reason. Those causes of the Great Depression where not fully fixed or addressed so therefore I believe that if Coolidge did prevent the crash it would just occur again at a different time.
ReplyDeletein response to you Joanne, i think there definitely are some things that President Coolidge could have done better, however there are many things that he also could not have done. When you look back at history it is often easy to forget about social and political pressures and ask why whoever you are looking at could have been so stupid to do what they did, rather than what you would have done. But you have to remember that a president, no matter who they are, depends on the people for their power, and thus they have to listen to the will of the people. At the time that Coolidge was president, the people were still largely in support of a economic system free of government intervention and influence. So while his actions may have not been what was best for the people, he was merely listening to what they were asking for. With that, i do not think that President Coolidge could have prevented the crash, because it would have meant going against the will of the people and the will of congress. An act against business would have been rejected by congress and made him unpopular with the people.
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