Hoover's Response Quiz

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Questions and Answers

What is localism?

Policy relied on by President Hoover in the early years of the Great Depression whereby local and state governments act as primary agents of economic relief.

What was Hoover's initial policy for dealing with the depression?

At first he felt that government should not get involved, so he did nothing.

What happened to Hoover's ideas that volunteerism and localism would fix the financial crisis?

They were ineffective.

Why did Herbert Hoover initially do little to respond to the nation's economic crisis?

He believed that government should not interfere in business cycles. Signup and view all the answers

How did Herbert Hoover think volunteerism would help turn the economy around?

Businesses and individuals would work together to end the crisis. Signup and view all the answers

Why did the policy of localism fail to provide sufficient economic relief?

City and state governments had few resources to relieve the crisis. Signup and view all the answers

What is meant by hands-off policy?

Hoover believed upswings and downswings in business cycles were natural and that government should not interfere. Signup and view all the answers

What is volunteerism?

Hoover relied on willful cooperation that would put personal interests aside and encourage production and consumption. Signup and view all the answers

What was the Reconstruction Finance Corporation?

A federal agency set up by Congress in 1932 to provide emergency government credit to banks, railroads, and other large businesses. Signup and view all the answers

What is trickle-down economics?

Economic theory that holds that money lent to banks and businesses will trickle down to consumers. Signup and view all the answers

What is the Hoover Dam?

Dam on the Colorado River that was built during the Great Depression. Signup and view all the answers

What theory prompted Hoover's plan to loan money to banks and other large businesses?

Trickle-down economics. Signup and view all the answers

How was the Reconstruction Finance Corporation (RFC) supposed to battle the depression?

By giving government loans to businesses and banks. Signup and view all the answers

Why did Herbert Hoover's theory of trickle-down economics fail to work as he had hoped?

Banks often refused to lend government money to businesses. Signup and view all the answers

What positive effect did the construction of the Hoover Dam have on the economy of the Southwest in the 1930s?

It increased employment. Signup and view all the answers

What did the Bonus Army want?

Money. Signup and view all the answers

What aspect of socialism did some Americans believe offered a way out of the depression?

A state-run economy. Signup and view all the answers

What did the Bonus Army demand from President Herbert Hoover?

Early delivery of promised payments for military service. Signup and view all the answers

How did General Douglas MacArthur respond to Herbert Hoover's order to clear Bonus Army veterans from their makeshift camps?

He used force to remove the protesters. Signup and view all the answers

During the Great Depression, which economic system did many Americans think was part of the problem?

Capitalism. Signup and view all the answers

What group of people marched on Washington, D.C., after World War I?

World War I veterans. Signup and view all the answers

What was the result of Hoover's order to remove the Bonus Army out of Washington, D.C.?

The order ended any chance he had to be reelected. Signup and view all the answers

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Study Notes

Hoover's Policies and Approaches

Localism: Policy advocating that local and state governments should be the primary agents for economic relief during the Great Depression.
Initial Stance: Hoover initially adopted a hands-off approach, believing minimal governmental intervention was required to address the economic crisis.
Ineffectiveness of Volunteerism and Localism: Both strategies were unsuccessful in alleviating the financial crisis due to lack of resources at local and state levels.

Economic Theories and Institutions

Trickle-Down Economics: Economic theory positing that financial aid to banks and businesses would eventually benefit consumers, promoting overall economic recovery.
Reconstruction Finance Corporation (RFC): Established in 1932, this federal agency aimed to provide emergency credit to banks, railroads, and large businesses.
Failure of RFC: Banks often did not distribute government loans to businesses, undermining Hoover's recovery strategy.

Key Events and Figures

Hoover Dam: Constructed during the Great Depression, the project significantly increased employment in the Southwest region.
Bonus Army: A group of WWI veterans who marched on Washington, D.C. in 1932, demanding early payment of bonuses promised by Congress.
Douglas MacArthur's Response: General MacArthur aggressively cleared the Bonus Army from the capital, employing force and leading to negative public perception of Hoover.

Political Ramifications

Impact of Bonus Army Incident: Hoover's decision to remove the Bonus Army damaged his public image and diminished his chances for re-election.
Public Sentiment Toward Capitalism: During the Great Depression, many Americans viewed capitalism as contributing to economic problems, leading some to consider alternatives like a state-run economy.

Conclusion

Hoover's reliance on localism and volunteerism proved inadequate in addressing the Great Depression, leading to significant economic and political consequences.

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