Landslide -- A Portrait of President Herbert Hoover
Subject: Jonathan Alter
Interviewer: Tracey Dorsey
This interview* was recorded in January 2008, as part of Landslide - A Portrait of President Herbert Hoover. The documentary is a co-production of The Duncan Entertainment Group and Stamats Communications. Iowa Public Television is the presenter and flagship affiliate for the PBS system. Jonathan Alter is senior editor and columnist at, Newsweek, a contributing correspondent at NBC News and author of The Defining Moment: FDR’s Hundred Days and the Triumph of Hope.
(* This transcript has been edited due to length.)
Who was Herbert Hoover?
Herbert Hoover was a tremendously bright, capable, talented humanitarian who, through circumstances that were partly beyond his control and partly due to his own limitations, was a very unsuccessful President of the United States.
How is Herbert Hoover relevant today in terms of economic policy or politically?
Well I think in terms of economic policy he has come, perhaps wrongly, to stand for the limitations of free market economics at a time of economic crisis. And so, when the Democrats, in all the years since have talked about Herbert Hoover economics, what they're talking about is a government that does not undertake what are, in economic terms, are called countercyclical efforts, amid a recession or a depression.
Hoover believed that, basically we can grow our way out of it if we just leave things well enough alone. That is a misunderstanding of Hoover's actually presidency. He, in fact, was not a conventional laissez-faire Republican. But the medicine that he did offer as the Depression worsened, was too weak to really restore confidence and get things moving again. And his personal limitations were crippling.
For leadership, you have to be able to inspire people a lot, particularly in the middle of hard economic times. You have to be able to inspire hope and confidence and he was just unable to do that. One of my favorite stories about Hoover's inadequacy as a public leader in the theater of the Presidency comes from the sculptor of Mount Rushmore, who quipped during Hoover's Presidency that if you put a rose in President Hoover's hand, it would wilt. Politics was harsh then too. Needless to say, Mr. Hoover was not among those who was considered to be put up on Mount Rushmore.
You wrote a little bit about Hoover prior to the election. He won by a landslide and galvanized the country prior to his Presidency. What was it about him that was so electric and what changed?
Well, you've got to remember Herbert Hoover was called the Great Humanitarian. He was, arguably, the most popular American at the end of World War I. Both parties wanted him as their Presidential nominee. There was talk in the Democratic Party of a Herbert Hoover/Franklin Roosevelt ticket in 1920. FDR himself actually wrote to a friend that our best bet would be to nominate Herbert Hoover, who was his old friend from World War I when they served together in Washington.
So Hoover was almost like Dwight Eisenhower at the end of World War II. He was just tremendously popular. Not because he had served in the military, but because of his remarkable feats of organization and rescue. First when war broke out in 1914, he helped to organize the evacuation of thousands of Americans and others from the continent; he helped to ease the plight of the Belgians after Germany overran, Belgium; and, after World War I there were millions who were starving in the, at this time, brand new Soviet Union, and Hoover organized a tremendous relief effort that, the biggest the world had ever seen to save hundreds of thousands of lives.
So people felt like he could do anything. He was a multimillionaire at a young age, mining executive, tremendously capable. Then, when he decides he's a Republican, he goes into the administrations of Warren Harding and Calvin Coolidge as Secretary of Commerce and he takes the Commerce Department from a kind of a backwater, and he makes it the center of the action in Washington. And there's all kinds of things, very positive things, that we're still benefiting from today.
Like, for instance, organizing the broadcasting industry, which was, didn't have any kind of organization to it and he brought everybody together. Introduced sensible regulation. Did that in a whole series of different industries. And so he was the dynamo of the Coolidge Cabinet and made that very hard transition from Cabinet member to nominee in 1928 and went on to a big victory.
Now you could argue that one of the reasons he won so big in 1928 is that his opponent, Al Smith, from the Lower East Side of Manhattan, and he talked like this, tirdy tird and tird streets. And he was a Catholic, the first Catholic ever to be nominated by a major party, and when he lost, he said the country wasn't ready to have somebody say the Rosary in, in the White House. He felt it was strictly because of his religion that Hoover won so big in 1928.
But I think a lot of it was that things were going really well and Hoover basically pledged in the campaign that he was going to abolish poverty, that the, his powers as an organizer, as an engineer who could work the various levers in the economy would be such that the prosperity of the '20s would seem like nothing, and that they would go on to much greater heights. And the stock market was roaring. And, indeed, through the first several months of his administration, it continued to roar.
But within seven months of his taking office, you have the stock market crash and then everything just kept going down, down, down to, at the period when he left office and turned over the Presidency to Franklin Roosevelt in 1933, we were at the very bottom of the Depression. And Roosevelt didn't even have to close the banks, they, three- fifths of them were already closed in that, the country was curled up in the fetal position and had lost all faith in Herbert Hoover.
I think that there's a common perception that the stock market crash caused the Depression. Is this true in your view? What did cause the depression?
Economists and historians are still arguing over what exactly caused the Depression. And I think the best answer is a combination of a lot of different things. The stock market crash alone did not cause the Depression. But, in combination with a weak banking system and an agricultural recession that was already underway in the mid 1920s, that resulted from the recovery of the European battlefields, which had laid fallow. Then, when they could produce again in Europe, they didn't need the exports from the United States the way they had just after World War I. So then American agriculture started to go down and that then pulled down the local banking structure which gave these local economies very little to fall back on.
So, I actually have a rather unorthodox explanation that's not a complete explanation of the Depression, but I think it's one that's overlooked and that is, the banking system of the United States. In Canada, which also suffered very severe recession or depression, only three banks went under; in the United States 10,000 banks went under. And that's because when you go into a small town they would have a general store, a saloon and a bank. And most of them were capitalized at under $100,000, which is no money at all for a bank. So it didn't take very much to push them out of business.
If we had had a branch banking system, the way they did in a lot of other countries, I don't think the Depression would have become so severe. But, when you knocked out the source of capital in all of these small communities and an economy that was still 50% agriculture, it made it very hard to come back. And, then I think on top of that you had economic policy basically driven by the Treasury Secretary for both Coolidge and Hoover, Andrew Melon, who believed that we just should liquidate everything and kind of ring the pain out of the system; and that somehow we were going recover if we just liquidated everything.
And that, you know, they kind of tried that and it didn't work. And so, after four years, clearly the country was ready for a different kind of economic policy. So I think that it was a combination of structural problems that took a stock market crash and sort of spread the pain all throughout the economy because of a weak banking system and then a macroeconomic policy that was not responsive and not willing to try a stimulus.
What was Hoover’s response to the crash?
Hoover did not sit on his hands after the stock market crash. The idea that he was a do-nothing president is wrong. The problem was that he didn't do enough. And so, a lot of what later became the New Deal, in fact, started under Herbert Hoover. But these were, at this time, small, almost pilot programs, and they were too weak, as medicine, to actually dent the problem.
So they were, some of them were very good ideas - Public Works, there were, Reconstruction Finance Corporation, but they were much too small to actually accomplish very much.
How do you compare Hoover’s response to how the federal government had responded to economic cycles in the past?
Hoover actually responded much more aggressively than many earlier presidents had when they would go through the boom and bust cycle. And, in that sense, he was more like a modern president than a 19th Century President, but he was kind of caught in that transition between the old, do-nothing approach in, in hard times and the New Deal.
You wrote in your book that he was not a do-nothing President. What was Hoover’s perception of the role of the president?
Well, he believed that the role of the President was to kind of coordinate private efforts. Get as much private involvement as you could with leadership from Washington, but not to use law and the actual legal authority of the President to impose big changes.
So he was, saw the President as more of a coordinator of private efforts. He actually, in the '20s, appointed Franklin Roosevelt, before he was Governor of New York, to something called the Construction Industry Council which was a collection of people related to the building trades and in Roosevelt's case he was in the bonding business for construction, and to get them all kind of working together.
It is one of the things that a President needs to do, but it's not sufficient. It's, coordination of private efforts is necessary, but not sufficient. His laissez-faire principles still prevented him from taking the more intrusive action that FDR and later presidents did.
You also write in your book about the depression and the impact on American life and that if you didn't live through it you had a hard time even understanding it. Can you describe it a little bit for us, what life was like?
You know, when FDR famously said, ‘the only thing we have to fear is fear itself,’ that was actually nonsense. If you're worried about how to put food on the table for your family, if you're worried about whether you actually will be able to put a roof, literally, over your head to keep out the elements, that's not fear itself, that's something real. And, what, he was more accurate, Roosevelt was when, in 1936, he said, ‘I see a nation one third ill-housed, ill-clothed, ill-fed.’ That's about what it was, about a third of the country was in real trouble.
So, if you were a teacher, say, in Chicago you weren't paid for the entire 1932/33 school year. You had to get by with help from loan shark or maybe more fortunate relatives. And most of them went to school and taught their students anyway, even though they, the City of Chicago was broke and couldn't pay them. On the farm you would just have a wave of farm foreclosures and people who lost everything. There were a lot of Harvard to homeless stories. It wasn't just poor people who got poorer. The people cascaded all the way down through the system.
And there wasn't the kind of safety net that we have today. If you were old, with no Social Security, you were poor. You know, unless you had, like a few people had the smarts to sell just before the crash and not ride the market down, but if you tried to, say, start a business to get yourself back on your feet, where were you gonna get the capital from with so many banks having gone out of business?
Or if you just were a regular person and you happen to put your money into one of the 10,000 banks that went under, you were done. No deposit insurance. Go to the bank, just like in the movies, they pull down the shade, sorry, your money's gone, you're outta luck. That's life. That happened to millions and millions of people. And it's really unimaginable for us nowadays.
Was deflation a huge problem?
Yes. I mean if you look at it in economic terms the liquidity crisis was a huge problem. There just wasn't enough money. And one of the things that Roosevelt did was to go off the gold standard and start to, as he called it, re-flate or inflate the currency. And that helped some but even that didn't get us out of the Depression altogether. But that was a minimal thing that they had to do. It was extremely controversial at this time, because that violated everything that Herbert Hoover or Calvin Coolidge and the rest of them believed as an article of faith that, you know, good as gold. That there, that you don't wanna print money.
But when you don't have enough money, sometimes you have to print money. And in that sense, Roosevelt, I think was right on the basic economics and Hoover was in the grip of a theory that was receding into history all over the world. Hoover was very bitter about it, 'cause he clung to those more traditional views through most of his life. And he believed that the economy was starting to recover at the end of his term and that if Roosevelt hadn't come in and messed everything up and basically he compared it to burning the right stock, which is what Hitler did when he came in around the same time.
That if Roosevelt hadn't done that the economy would have recovered and we would have been back into a boom. The problem with Hoover's theory was that there had been four years for us to start to pull out and there wasn't any movement, any significant movement until late 1932. And even then, with things starting to turn up a little bit they had a long way to go, and it would have, wasn't at all clear that if Hoover had been reelected we would have just pulled right out of the Depression as he predicted.
Of course, he was wrong on some other things too. Later, one he was a big isolationist and really did not recognize the threat of fascism in Europe. So Herbert Hoover was a brilliant man whose political and economic judgment was flawed.
You have written, I believe, that Hoover was saying that he was turning around the economy. It was the election of FDR that paralyzed the country and that he was right, in part.
I think that there is a grain of truth that because it was the wealthy who had what little money there was, and they were scared of Roosevelt. And so one of the things he meant when he said there's, the only thing we have to fear is fear itself, he was essentially trying to say to the wealthy, don't be afraid of me, don't fear me. You know, go back and redeposit your money in the banks, which a lot of people did, and that was one of Roosevelt's bits of genius.
But there was a fear of Roosevelt and so after he was elected, things got a lot worse between November of 1932 and March of 1933, which is when presidents in those days were inaugurated and things went lower, and lower, and lower. And, suddenly because of some events in Michigan involving Henry Ford, you had this wave of bank collapses. And starting in Michigan they closed all the banks there, and then it reverberated out through the economy.
Now I would fault Hoover for not taking action at this point. He should have used what authority he had to declare a bank holiday or a bank moratorium, as he called it. And he would only do it if President-Elect Roosevelt joined with him. And Roosevelt didn't wanna have the responsibility when he wasn't President yet. He was a private citizen. He wasn't even Governor anymore. He'd left the governorship on January 1st. And so he didn't wanna get pulled into it.
Then Hoover tried to pull the Treasury Secretary-designate, he, a guy named Will Woodin, who was to become Roosevelt's first Treasury Secretary. He tried in the middle of the night at, before the inauguration to pull him into an agreement to shut all the banks, which was, the guy was the head of a rail road car company, and Hoover was so confused and in a panic about what was going on, that he even tried to do a deal with him, until his advisors told him, no, no, Mr. President, you know, please get, get a grip here.
Many of them urged him just shut the banks. He wouldn't do it. And then when Roosevelt came in, of course, the following week Roosevelt shut those banks that had not already closed their doors.
This is a really controversial period and you write about it at length. Why do you think Hoover felt it necessary to involve Roosevelt? Why didn't he act on his own?
You know, I argue in my book that it really was a character test for Herbert Hoover that he failed. He should have said, okay, yes, there will be some criticism from the Democratic Congress, but I will use this little known instrument that his own Treasury Department, the Hoover Treasury Department had discovered. It was a World War I law called the Trading with the Enemy Act, which he could sort of use under certain legal interpretations to close the banks and signal to the financial system that he was taking decisive action.
His failure to do so does not reflect well on him in this period. And mars what, in many ways, was an outstanding career otherwise.
How did Hoover’s relationship with FDR change over time?
Hoover and Roosevelt had a fascinating personal relationship, which I try to outline in my book. And it started out with them being good friends and having dinner together a lot in the teens when they were both together in Washington. Then, in 1920, Roosevelt wanted Hoover as the Democratic nominee for President.
The relationship started to deteriorate in 1928 when Roosevelt sent out a letter, a chain, you know, form letter, in support of the Democratic nominee, Al Smith, that Hoover interpreted as accusing him of being materialistic. And he considered this to be a great insult from the man who he considered his friend, the Democratic candidate for Governor of New York that year. And their relationship began to deteriorate after that.
So they went from being good friends, to archenemies, to, after the March 4th 1933 inauguration, never speaking to each other again, ever. When Hoover would come to Washington, he would only do so when he knew that FDR would be out of town. And even though FDR was urged to try to use some of Hoover's skills in the government, he never would. It wasn't until Harry Truman came in that they again consulted with Herbert Hoover.
So it became extremely bitter and they were basically things got so bad between them that at the ceremonial tea that they had at the White House on the afternoon before the inauguration, FDR's son, Jimmy Roosevelt, said that, Hoover was so insulting that he felt like punching him in the nose. And when FDR returned to the Mayflower Hotel, he considered Hoover to have been rude in the way he was treated.
Hoover, in turn, in their meetings that they had in between the election and the Inauguration thought that Roosevelt was a numbskull, not up to being President of the United States, not intellectually fit for the office. And then they were basically talking, even arguing on the phone as late as one o'clock in the morning of the day of the Inauguration. Unimaginable now, the outgoing and incoming President, you know, talking about the banking crisis in very strained terms.
And the next day according to American ritual, they ride down Pennsylvania Avenue together to the Inauguration. Things were so tense, they exchanged not a word in the car, except when Roosevelt looked up at the Commerce Building, ironic since Hoover had been Secretary of Commerce, that was under construction and said, lovely steel. Those are the only two words they exchanged. Hoover said nothing.
And when they saw the crowds lining the road, and Hoover sat there stone-faced, Roosevelt finally as he later recounted it, he said, ah, spinach, I'll wave to them if Hoover won't. And he took off his top hat and started waving to the crowd and they started to cheer the incoming President. And Hoover was dour indeed, sour throughout that momentous day.
Did this discord ever dissipate?
After March 4th, 1933, when Roosevelt was inaugurated and gave his famous inaugural address, the two men never spoke again, even on the telephone. Whenever Herbert Hoover, who lived another 31 years, whenever he would come to Washington, he would make sure that Franklin Roosevelt wasn't in town when he got there.
And Roosevelt, as a way of further savaging Hoover, whom he thought he would face in a rematch in 1936, (it's hard for us to believe, but Roosevelt didn't believe Hoover's political career was over) had some of his people, spread the word that Hoover, in 1917, had been against U.S. entry into World War I and that he wasn't really up to snuff in terms of the national security of the United States and understanding potential threats to it.
So he spread that word and Hoover was not nominated in 1936, but even by 1940, he was still a potential candidate for President. But the feeling got so bitter because they had three very tense meetings between the November '32 election and the March 1933 inauguration, when the country is coming apart at the seams. Hoover sends Roosevelt a letter saying, you must come to Washington and join me in acting to prop up the financial system of the United States, which is in melt down.
And he basically has Roosevelt served, almost like it's a subpoena, at a press dinner in New York City. The letter, hand delivered by the Secret Service, is pressed into Roosevelt's hands, and he wants him to come down to Washington. Roosevelt doesn't want to be drawn in by Hoover to taking action before he becomes President. So what does he do? Does he tell Hoover, no I'm not gonna come down and join you in taking action? No. Does he go down immediately as Hoover wants him to do, to Washington? No. He, after he kills about ten critical days, writes Hoover and says, I'm sorry, I lost your letter, and Hoover had to write him again. He uses the blame the secretary gambit: my secretary lost the letter.
So, for the last 70 years, historians have kind of figured that that sounds like a kind of a phony excuse by FDR, but we have no proof. I don't have definitive proof that it was phony, but when I was researching my book, I found, from the previous summer, a letter from Louie Howe, who was FDR's, you know, Carl Rove, his top aide, on a different matter, advising FDR: just pretend you lost the letter, and we can blame your secretary. So we have motive and we know that FDR, just a few months earlier, had used the same gambit on a different matter.
So I think it's highly likely that FDR was just fibbing when he told Herbert Hoover that he had lost his letter, and that was why he hadn't been able to come down to Washington and join him in joint action against the banking crisis. So Roosevelt was right not to be drawn in, but he was not honest in resisting the pressure to be drawn in.
Well, in terms of Hoover's motivation, some people have said he was really naïve and some people have said that he was trying to bend Roosevelt to his policy and force Roosevelt's hand in adopting his policies. What's your take?
Well, I think Hoover was a combination of being naïve, not very dexterous, skillful politician, and also manipulative in his own way. So, for instance, when he first approached Roosevelt, not long after the election, to try to get him to agree to certain standards and how they would deal with a crisis involving loan repayments by our allies from World War I, which they were defaulting on. That was the first crisis after the election.
He wanted Roosevelt to stipulate to five or six things in a joint statement. Roosevelt refused. At this time when he was trying to get him to do it, Hoover confessed to a friend, a Senator who was a good friend of his, that if Roosevelt did this, "He would be repudiating two thirds of the so-called New Deal." So Hoover was trying to get Roosevelt to repudiate his unorthodox economic ideas and go back to the old time laissez-faire religion.
Now Roosevelt himself was in a difficult position because there were a lot of conservative Democrats in those days, who basically agreed a lot more with Hoover than they did with Roosevelt. And indeed, the original bank rescue package that Roosevelt put through in his famous first hundred days was designed by the Hoover Treasury Department. So when New Dealers came to FDR early on and said, well, of course, after this terrible, bank collapse you're gonna want to have a government takeover of the banks, right President Roosevelt? And he said, no.
And then their fallback position was to have the Post Office take over all the banks. That would have been cute if we had had a 20th Century with Postal Banks. Roosevelt said, no, I'm gonna stick with the Hoover Treasury Department Bank Rescue Plan, which is indeed what was implemented in 1933.
So Roosevelt would go a little bit left and a little bit right, and he did adopt and build on a number of things that Herbert Hoover started, but he had so much of a superior political impression that he made on people, even just the smile, the uplifted chin. Hoover was not very convincing when he would talk. His own aides tried to get him to be less boring. He would read, literally, 50 page speeches in a monotone. You can't lead that way, and when he would be told, can you try to lighten up? Can you try to even just look up more when you speak, or look in this direction? He couldn't do it. So he had these great skills; he was probably one of the three or four brightest American Presidents in terms of his IQ, but in terms of what they call EQ, his emotional intelligence, his ability to relate to people, and to intuit what they were thinking and respond to them, he was in the bottom group.
And I think you could make a strong argument that EQ is more important for a President than IQ. A lot of people have compared Hoover's Presidency to that of Jimmy Carter. They were both brilliant engineers and they had a lot going for them, but they failed at not just some of the theatrical and inspirational parts of the Presidency, but in really connecting to the American people, which you have to do if you're going to be a successful American President.
I find it so interesting that prior to his assuming office he was really able to generate this brilliant PR campaign and then he's President and he can't seem to get it going. Any thoughts on that?
It's really very puzzling that the same Herbert Hoover, who could master the press when he was Food Administrator and was really one of the earliest practitioners of public relations, wasn't able to do that when things started to go south on him. He really only had three or four reporters, one cartoonist, and a few others who were behind him.
You can really see that when Roosevelt came in and started holding two press conferences a week and they clapped, because they got to actually ask the President questions. We take it for granted now, but Hoover didn't hold those kinds of press conferences.
My own feeling is that lack of accessibility always hurts, especially when you're in trouble. It's a natural instinct for Presidents when they get into trouble; cut out the press, who needs a lot of inconvenient questions. But when you antagonize the press, you also loose touch with what's going on, because those nasty questions, which might be offensive to you are, nonetheless, what Abraham Lincoln called a public opinion bath. They're giving you a sense of what's going on in the country, and if you cut yourself off from that, you don't really have any sense of how much trouble you're in.
Hoover didn't know that he was in trouble until the end of the '32 campaign. Remember, polling was only in its infancy then, and it wasn't until he literally was pelted with tomatoes at a campaign stop that he realized that the response he was getting out there left something to be desired, that he fully understood that he could be headed for a cataclysmic defeat. So he was not in touch with where the country was.
Another example is when Roosevelt comes to the White House as Governor in the spring of 1932, and Hoover offends the Roosevelt's, particularly Eleanor, by delaying, before he came downstairs to the East Room of the White House, where the Governors were waiting. It was very hard for Roosevelt to stand because of his polio, and so he was exhausted and you're supposed to stand while you're waiting for the President.
Hoover just thought he was too weak to be President. So, on the day of Roosevelt's nomination for President at the Chicago Convention in the summer of 1932, when Hoover hears it on the radio that the announcers have disclosed that Governor Roosevelt, who suffered from infantile paralysis, Polio, was being helped to his feet, helped to the microphone to give his acceptance speech, Hoover figures, hey, this is over, I won this thing. This is a joke. They just nominated a cripple for President. You know, I'm it for another four years. So he really just didn't get it that he was in a lot of political trouble.
There are many reasons that Hoover lost the election in '32, any that can be attributed to Charlie Michelson? What role do you think Michelson may have had in defeat?
Well, the public relations that Hoover had used brilliantly on his own behalf as Food Administrator, got turned against him in the '32 election. There was a guy named Charlie Michelson, the ghost, who worked with the Democratic National Committee, and he would take any bit of bad Hoover news and, very skillfully, disseminate it everywhere. And he was the guy who took the idea of Hoovervilles, for instance, and turned it into a household word.
Then they had Hoover cars, which were carts drawn by goats for people who couldn't afford cars, and he used little jokes about Hoover, like they say, he asked for a nickel, so that he could call a friend, and they gave him a dime so that he could call his only two friends.
The jokes kind of never ended and I think Hoover, in some ways, asked for it, because he was not a talented campaigner. They didn't have debates in those days, but he wasn't exactly setting people on fire with his campaign oratory that year.
Actually, Roosevelt wasn't either. Roosevelt wasn't a fantastic candidate in 1932. He wasn't saying a lot, but Hoover was running as a protectionist, which didn't help him a lot on the farm belt. He had signed the infamous Smoot-Hawley Tariff and Roosevelt, actually, was kind of hedging on free trade. Roosevelt was giving a speech on trade, and he got one draft that was protectionist, one draft that was free trade, and he said to his aid, Raymond Moley, just weave them together.
He was, in some ways, the classic flip flopper trimmer, but it worked for him that year and later on in his Presidency. Hoover was more dug in to the protectionist view, which was popular with capitalists in the cities and people in manufacturing, but was very unpopular in the 50% of the economy that was agricultural.
You mentioned Smoot-Hawley, and that's one of the things that I want to talk to you about. A lot of people say that it was the weakest point of his Presidency. Can you tell us a little bit about what Smoot-Hawley was and what impact it had?
I think it's simplistic to say that the Smoot-Hawley Tariff caused the Great Depression. The economy was not so reliant on exports that it would have done that, but it sure didn't help, and it was one of several factors that made a bad situation, even worse.
I think if you'd ask Franklin Roosevelt when Hoover lost the election, he would say it was during the Bonus Army March. In fact, when he was being served breakfast in bed on the day after Hoover ordered out the troops and MacArthur and his adjutant, Eisenhower routed American veterans just outside of Washington, Roosevelt said, well, you know, that's it, I've, Hoover's lost.
So he knew immediately in the summer of '32, when Hoover mishandled the Bonus Army. That's when he knew, or strongly believed that he would be the next president. I think Roosevelt was right. I think that the Bonus Army situation was a bigger factor in his defeat than the Smoot-Hawley Tariff. Remember, a lot of American's didn't even see the economy, that summer of 1932, as the big issue. Al Smith would have been the Democratic candidate in 1928. He thought the big issue of 1932 was Prohibition, and that was what his speech at the convention was about.
The kind of sluggish economy, the recession, didn't turn into a full fledged, paralyzing Depression until after the election, even though unemployment had zoomed up, starting in 1930. People were worried about it, but it wasn't the only topic of conversation. There were these other issues like Prohibition. What the Bonus Army did was it brought together the misery of the depression with Hoover's inability to do anything about it, in fact, to do the wrong thing about it.
So here you have these American veterans, and all they are is hungry. They are appealing to the Congress to give them their bonus early. Even FDR and the Democrats don't want to do that, but they're smart enough not to start shooting at them. When Hoover did that, partly on the advice of those who said that the Bonus Army was made up of communists, or people who wanted to revolt, Roosevelt's reaction was coffee. A man like that needs a good cup of coffee, and that's what he suggested Hoover should have done in 1932.
When the Bonus Army came back in the summer of 1933, when Roosevelt was President, he sent Eleanor out into their encampments with coffee, and she sang old World War I songs with the veterans, even though he didn't give them their bonus. In fact, he cut veterans benefits more than Herbert Hoover did. He slashed veteran's benefits, but he knew how to deal with the situation in a friendly way. Hoover's decision to deal with it in a hostile way, perhaps at the prodding of Douglas MacArthur, though there are a lot of different stories as to why Hoover ordered the army out, was devastating for his public image.
Later, when Eleanor Roosevelt went out in 1933 and gave them coffee and sang songs with them, the line from the veterans was, Hoover sent the army, Roosevelt sent his wife. For a lot of Americans, that was the contract, and it was over that issue of the Bonus Army.
There were some people who were advising people to do what would have been the right thing, which was to not attack the veterans and to maybe bring some of their representatives over to the White House to talk, or to send emissaries. Others were advising Hoover to take a harder line. So, whether MacArthur exceeded his authority or not, Hoover did, in the end, side with the hardliners. I think it's accurate history to say that he was not responsible for the Bonus Army fiasco.
He was the Commander in Chief; he was monitoring the situation closely, as he did everything. He had his fingers in everything. He was a very activist President. He was not out of touch when it came to the issues. He was out of touch when it came to public opinion, but when it came to the substance and the details of the issues he was on top of everything. And his mind was like a sponge. Many people who went to see him felt that he was the brightest individual they'd ever met.
So it wasn't a question of him not thinking through all the angles. He just didn't always make the right decisions. And I think there are lessons in this as we look at Presidential candidates and Presidents: that being the best informed doesn't necessarily make you the best President, and that just because you're really smart doesn't mean you necessarily have great judgment. So I think that Hoover is a real object lesson in the limitations of intelligence, experience, and even attentiveness in an effective President.
I want to just talk about the New Deal and then some of the aftermath that FDR's is obviously widely celebrated for. How did the policies this time differ from many of the policies that Hoover had in place?
Well FDR, essentially, took several ideas that Herbert Hoover originated and brought them to scale. So Hoover started to do increased public works, Roosevelt did tremendous amount of public works projects; Hoover created the Reconstruction Finance Corporation to help get business back on its feet, Roosevelt greatly expanded the RFC; Hoover's banking program was adopted almost in total by Roosevelt.
So there were a number of similarities, but there were also huge differences. And, I think, maybe the best way to understand that is to look at something like Social Security, which is something that Herbert Hoover considered to be a total violation, not only of his personal, political convictions, but of the Constitution. He just thought that it was socialist to essentially take money from working people through a payroll tax and give it to retirees.
So there was nothing that even vaguely resembled that in the Hoover Administration. So the social contract of what we owe each other as a people changed sharply from Hoover to Roosevelt, even as some of the policies actually continued.
Hoover, you know, after a year or so of keeping his mouth shut, then went on to start criticizing Roosevelt loudly and vehemently, and compared him to a dictator and that some of his policies were even fascist. I assume FDR was aware of that criticism. Do you know anything about his reaction to those criticisms?
Yes, FDR did not appreciate Hoover's criticism, which took the form of several books and many speeches. He considered that Hoover was his likely opponent in 1936 and then in 1940, he even thought there was a chance that Hoover would be nominated. There was a brief boomlet for him, so he was always monitoring what Hoover did and he considered Hoover to have been hopeless, and that he didn't act.
So it was no coincidence that starting from his Inaugural address, he used that word action, and action now, six different times. He believed that Hoover froze, particularly when the banking crisis worsened, and that he wasn't able to take the action that he needed to do. And he was rather contemptuous of Hoover's claim that he needed Roosevelt's participation as President-elect before he could take action. Even though, on some level, he knew that Hoover was a capable person, he never found anything for him to do. He could have used his abilities for relief; he could have used his abilities in World War II. It wasn't until Harry Truman came along that Hoover was brought back in even an advisory way.
So Roosevelt, in general, was really resistant to those who blamed him. He felt like he had saved them; he had saved capitalism, and I argue in my book that Roosevelt basically did save capitalism. Hoover thought that was bunk, and that the economy would have recovered, and that Roosevelt was an alarmist, and that the only reason the bank started to go down was because everybody was scared of Roosevelt anyway.
The problem with that theory is that, if the economy had been capable of just recovering on its own, it would have done so in a more demonstrable way. Remember, in 1930 things start turning horrible; you're up to 25% unemployment in some areas; 1931, horrible; 1932, horrible. At the end of 1932, Hoover thinks he sees some signs of recovery, but they weren't very strong signs, and there wasn't really any indication of it coming to an end.
So to believe that he was right you have to believe that something would have just changed on its own. But if it hadn't changed on its own before, I'm not sure how it would have without deposit insurance, some sort of bank reorganization plan, and then a series of other first 100 days programs that put some adrenaline back into the economy, at least for the short-term.
Of course the Depression didn't end until World War II, which Hoover liked to remind people of, that his successor got all the credit for ending the Depression, but it didn't really happen until a war started. I think on that, history has vindicated Hoover. Most historians agree that Roosevelt really didn't get us out of the Depression. But the other thing that was very unfortunate for Hoover's reputation is that he became a punching bag for Democrats.
All the way through the 1960s, Democratic candidates could always get a cheer from Democratic audiences by stomping on Herbert Hoover. It's like nowadays, if you become a punch line, it's hard to get your reputation back. And it's also not as if there were all these brilliant things that he did in his Presidency that have been ignored by historians.
The remedies that he applied were not sufficient to the problem. So you can say, well maybe Hoover had some good ideas, but if you have some good ideas for fighting the Depression and you don't implement them on a big enough scale, they're just ideas; they're just pilot programs, but not anything that makes for real change.
So I think those who would try to resurrect him altogether, rehabilitate his reputation, are in for a hard ride when it comes to his Presidency. But we do need to have a much broader appreciation of his career contributions, which stem from the turn of the century through the late '20s, then resume again in the late 1940s. This is a man who did a lot for his country, and for the world, and in many ways he was a progressive Republican by today's standards. He would be considered a liberal Republican, and I think that's kind of missed by some of these analyses of his career.
Go back a little bit to World War II actually ending the Depression and buoying the country up. Roosevelt walks away the hero Hoover walks away, in terms of public opinion and history, the scapegoat. Neither of their policies changed the way Americans lived day-to-day dramatically.
Hoover's policies changed the way American's live in terms of the way the broadcasting industry is organized and the way certain other industries are regulated are organized. So you could say that the television that you watch, and the rules that govern television and radio are partly a legacy of Herbert Hoover.
Certain public works like Hoover Dam, which the Roosevelt administration was so ungracious as to change the name to Boulder Dam. Obviously it had been a result from Herbert Hoover's efforts. The humanitarian things he did you can't ever take away from it.
In terms of changing the way Americans live, the New Deal has a much larger legacy, and should not just be judged by whether unemployment went down to a certain rate before 1940. If you look at Social Security, the bargain struck in terms of what we owe people who are in trouble, what the government owes them, is forever changed by the New Deal.
I think one way to look at it is through Hurricane Katrina. Now Herbert Hoover, when he was Secretary of Commerce and there was a huge flood of the Mississippi River, did very heroic work mobilizing a lot of relief for the flood, but it wasn't seen as a federal responsibility to those people in trouble. Indeed until FDR, if you were in trouble it would be nice if people like Herbert Hoover came to your assistance, but there was no requirement that they come to your assistance.
By the time of Hurricane Katrina, when the Bush Administration didn't respond quickly enough, even the most conservative American's didn't say, it's not Washington's business if people are drowning and starving in New Orleans. That's something that changed with the New Deal: the idea of what the government actually owes the American people, and what that sense of reciprocal responsibility is about. Hoover had a very different idea about that. Hoover believed in voluntary efforts; Roosevelt believed in using the force of law and the power of the Federal Government to change people's lives. Those are two very fundamentally different ideas and to this day, in some ways, they give you some sense of what each party represents. But what's changed is, when President Bush tried to, ala Herbert Hoover, privatize Social Security connected to the market, it was so much of a slam-dunk against him that it never even came up for a vote. It did come up for a vote in the Reagan administration, to go back to that Hoover, anti-Social Security view. It lost in the Senate 98 to nothing.
So the country has moved on from that approach. Even though on some issues Hoover was not a tax cutter and he was not a free trader, he would be very out of step with modern Republicanism. On other issues, interest terms of the role of the Federal Government in the lives of the American people, he was very much one of the models of how Republicans, who believe in small government, should approach public issues.
I was really interested to know what you think Hoover's legacy should be?
Well I think Herbert Hoover's legacy should be what he did before he was President, when he basically helped to pioneer the idea of large-scale rescue and relief. These were tremendous feats of organization and humanitarian leadership and we now take it for granted that when something bad happens somewhere in the world, that people will organize to bring in supplies and that it'll get done.
Well, that didn't really start happening in a big way until a combination of the Red Cross and Herbert Hoover really developed this idea. That, to me, is a tremendously important and overlooked legacy. I don't think the legacy of his presidency will benefit him and his own reputation. It's more of an object lesson in how not to act and that, in a sense, his legacy is, if you can't master the theatrics of the Presidency, and you cannot inspire the American people, you cannot govern. You can be the smartest person in the world, you can have great relationships with other players in Washington, but if you can't inspire, you can't govern effectively.
And I think we've seen that in recent presidents and we certainly saw it in an important way in Herbert Hoover.
Herbert Hoover's comments about Franklin Roosevelt make anything that Jimmy Carter says about George W. Bush, or that Bill Clinton says about George W. Bush look tame by comparison. He was ferocious in his criticism of his predecessor. He didn't mince words at all. Hoover actually wrote that Roosevelt intentionally precipitated the banking crisis so that he could enter stage left as the big hero and that they actually wanted the economy to go down so that Roosevelt would look better.
Now that's a serious charge. It's one with a grain of truth; I think that Roosevelt did want to be able to come in as the big hero and not have joined with Hoover and repudiated New Deal policies, as Hoover wanted him to do. So Roosevelt was right to resist the pressure from Hoover to join with him before he was sworn him, but Hoover was right that Roosevelt did want to ride the economy down a little lower so he could come in and make this great theatrical debut as President. But that's a different thing than saying that Roosevelt caused the banking crisis.
I mean the banking crisis was caused really by the dysfunctional relationship between Henry Ford and Edsel Ford in Detroit. When Ford Motor Company’s bank collapsed, that the Ford family owned, and Hoover desperately tried to get Henry Ford, through emissaries, to bail out the banking system of Michigan, which it could have easily done, when Ford refused Hoover's efforts to do that, then the banking structure of Michigan collapsed. They had declared a bank holiday there and it reverberated out through the rest of the system. And that, not Franklin Roosevelt, was what caused the banking crisis. Hoover tried to stop it, but the strange relationship between Henry and Edsel Ford had serious repercussions for the American economy in that dire winter of 1932/33.
Is there anything else that you think is important to know?
Gutzon Borglum, who was a very famous sculptor of the time, who is the one who did Mount Rushmore, he summarized Hoover's problems by saying that if you put a rose into President Hoover's hand, it will wilt.