The things Hoover believed in--efficiency,enterprise, opportunity, individualism, substantial laissez-faire, personal success, material welfare--were all in the dominant American tradition...The victim of his faith in the power of capitalism to survive and prosper without gigantic governmental props, 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.
Richard Hofstadter, The American Political Tradition and the Men Who Made it
Is he just plain wrong? Thomas Woods, in particular, asserts that Hoover was an interventionist and one of the first Keynesian presidents. Also, there is the common knowledge that most of Roosevelt's programs were just Hoover programs renamed and given more funding. Are there any good readings you all would recommend for showing Hoover didn't believe in those things or acted in a way that was not consistent with his so-called beliefs? Any discussion on this topic (for either side) would be helpful.
"It has been well said that, while we used to suffer from social evils, we now suffer from the remedies for them."
F.A. Hayek, The Constitution of Liberty
He is just plain wrong.
Hoover was the head of the Food administration during WW1, so he had a history of central planning. He also signed the Smoot-Hawley Tariff. He increased government spending and turned a large surplus into a very large deficit. He fought to keep wages high.
Bob Murphy's PIG book on the depression is a good one.
Hoover being a free market guy is like the myth that Lincoln was an egalitarian.
I believe that Hoover was interventionist enough that FDR actually ran on a platform (or at least plugged here and there) calling for less intervention and a return to laissez-faire roots. Though by todays standards he would probably be considered somewhat free-market, he still ran the highest peace-time deficits and raised taxes to their highest rates (up to that point). Search Hoover in the mises search bar
Read until you have something to write...Write until you have nothing to write...when you have nothing to write, read...read until you have something to write...Jeremiah
Is this laissez-faire?
Political Atheists Blog
Hoover was the principle reason why an interventionist policy was taken by the government. He had argued for one ten years before, after his experience on the war board, and as president was finally able to apply his interventionism on a big enough scale.
Why does he so vehemently assert this then? I mean, its not just once, here another example:
Hoover's greatest handicap, however, lay not in his personal limitations but in his philosophy. He devoutly believed in the comparatively unregulated profit system under which he had grown up. He would not say that the system was invulnerable--it could, of course, be thrown out of gear by wrong thinking and unwise practices; he knew also that it was subject to cyclical fluctuations, which he felt could be diminished. But its basic principles were thoroughly "sound". If it were allowed to proceed with no more than a smack and a dab of government regulation here and there to prevent "abuses," it could not fail to minister more and more effectively to human welfare...He had become a wild-eyed Utopian capitalist.
Besides it being just a common sentiment, why is Hoover characterized as laissez-faire? We listened to some of his writings in class, and if he didn't act like a free market supporter, he at least seemed to support it in his mind.
"Besides it being just a common sentiment, why is Hoover characterized as laissez-faire? We listened to some of his writings in class, and if he didn't act like a free market supporter, he at least seemed to support it in his mind."
Remember George Bush, who proclaimed that he was a big free marketer? These politicians do this cause they have a certain constituency, not cause they really believe it.
Also, statists like Hofstader (the same author of the overquoted Paranoid Style in American Politics) like to lie a lot - anything in defense of the state.
Is that Hofstadter's mission? I've never really looked up Hofstadter's leanings but is his mission to further the state? Than why did he right so poorly of Hoover (since we all know Hoover acted in a way very similar to Roosevelt)?
Anyway, I think the difference is that Hoover wrote numerous books on the matter, he just didn't make speeches. Was all of it for political reasons? And why didn't Hofstadter mention that Hoover was quite far from "hands off" in his policies? Are they just unheard of, purposefully silenced, or, in fact, reality?
Hey, just to give you all an update I'm writing a paper on Hoover and I was wondering if anyone here had information on any policies he had regarding interest rates or other federal spending... any help would be appreciated.
Richard Hofstadter flat out lied his ass off about Hebert Spencer (in his book Social Darwinism in American Thought). He claims that Spencer was a racist, supported involuntary eugenics, and was pro-imperialism; none of which are true. This isn't a guy you can rely on without checking his sources.
"I cannot prove, but am prepared to affirm, that if you take care of clarity in reasoning, most good causes will take care of themselves, while some bad ones are taken care of as a matter of course." -Anthony de Jasay
Here is the "semi finished" product... tell me any corrections or just thoughts/criticisms in general.
Herbert Hoover: Laissez pas Faire
“True Liberalism is found not in striving to spread bureaucracy, but in striving to set bounds to it,” Hoover once wrote in his book The Challenge to Liberty; ironically, this came many years after he had become a “great bureaucrat” in his role as Secretary of Commerce during Harding’s administration. In fact, it is widely known that the “Secretaryship of Commerce rose under Hoover” and its “functions grew rapidly” (Hofstadter 378). This performative contradiction might be permitted if it was the only one that Hoover was guilty of, however, like many politicians, Hoover’s words and actions differ almost as a matter of principle. One need only look as far back George W. Bush to see the inconsistencies inherent in politicians; in his first inaugural address Bush promised to be “fair and fiscally responsible” (Bush) and he may now go down as "arguably… the least fiscally responsible [President] in history" (Task). The discovery of Herbert Hoover’s true political ideology, because of his many inconsistencies, merits an investigation spanning both his political works and his actions in and out of the oval office.
That Herbert Hoover was not like some presidents (that is unwilling or unable to write books) allows any investigation into his ideology to proceed rather easily; one need only read what he wrote about such matters to see what he believed in, at least in theory. Chronologically his first book was Principles of Mining, written in 1909. Whilst an instructional manuscript regarding mining may seem unrelated to the political ideology of Herbert Hoover, it is perhaps all the more important for not expressly being written for this purpose. Since his writing regarding politically incriminating things is probably less subdued, Principles of Mining may be eschewing Hoover’s true beliefs in matters that are irrelevant to the book – political ideologies, for instance – and what is read my be a closer representation of Hoover truly thought as a result. Most of the manual is useless in regards to this paper; however, one quote merits a second look: “[t]he mining engineer is no longer the technician who concocts reports and blue prints. It is demanded of him that he devise the finance, construct and manage the works which he advises” (Principles of Mining 185). This first snapshot of Hoover seems to be far and away from the Hoover that historians so doggedly apply the term “laissez-faire” to. Instead of opposing this unprincipled increase in powers and responsibility, granted it is in engineering, Hoover almost embraces it; obviously the increase in the power of the executive (especially apparent in Theodore Roosevelt’s administration) is not something that would conceivably bother him. This sole quote from a book on mining is not enough to indict Hoover as laissez pas faire, so perhaps this is the exception, not the rule.
Herbert Hoover’s first book on political philosophy, American Individualism, was written in 1922 and describes the particular offshoot of individualism that he subscribes to: namely, ‘American Individualism’. American Individualism, also called Progressive Individualism, is a mix of the “values of individualism” which are “initiative…the development of hand and intellect…the high development of thought and spirituality” and a “fixed ideal” of “equality of opportunity”; that Hoover believed himself as an American individualist cannot be questioned: “I am an American Individualist” (American Individualism 8). It seems that historians, particularly Hofstadter, are correct, for surely if one is individualist, then one must also be laissez faire. Yet again, however, historical misconceptions come to be just that: misconceptions. In his book, Hoover specifically states that American Individualism has “long since abandoned the laissez faire of the 18th Century” (American Individualism 10); this is almost in complete contradiction of Hofstadter who stated in no uncertain terms that Hoover was a “wild-eyed Utopian capitalist” (Hofstadter 383). It is no stretch to say that Hoover opposed socialism; he speaks of the “ghastly failure of Russia” and “grim failure of Germany” explicitly, and correctly contrasts the socialist positions of these two countries with the individualism (even if its individualism with conditions) of the United States. More proof is needed than a simple juxtaposition of socialism and individualism in order to close the case on Hoover’s political ideology.
While long and often extremely technical it stands to reason that the memoirs Herbert Hoover would contain a great amount regarding his political ideology. Limited as this paper is, there is not nearly enough room to delve deeply into even one of his memoirs; powerful and incriminating quotes can still be gleaned from them even with only a superficial reading. For instance, in The Memoirs of Herbert Hoover: Years of Adventure, he proclaims that “the whole genius of American business, and even governmental administration, prescribed a single responsible executive with boards only in advisory, legislative or judicial functions” (The Memoirs of Herbert Hoover: Years of Adventure 240-241). In fact, an active government, and especially the executive, is right in line with the Republican Party, which before FDR was the “party of government activism” with “strong presidential leadership or an aggressive presidential agenda” (Holcombe). While it seems that Hoover fits the bill precisely for being a candidate of the Republican Party, it does not account for his reputation of being laissez faire and non-interventionist; his nomination for the party that historically partnered with the progressive party, in fact, seems to indicate that he would be the opposite.
While his works, especially if one only looks at their titles, protest to his seeming classical liberalism, a deeper inspection would reveal many reservations; Hoover doubted that individualism could be “maintained as the foundation of a society” and that “individualism run riot…would provide a long category of inequalities, of tyrannies, dominations, and injustices” (American Individualism 8-10). Historians, however, may base their criteria for political ideologies off of actions, not merely words; as one would expect Hoover’s actions are the primary target of historical criticism. In fact, after Hoover ordered the Bonus Army routed, it was “fixed in the mind of Americans… that Hoover was cold and heartless” (Hartman). Despite conceding that Hoover had enacted some legislative measures that were anything but laissez faire, Hofstadter concludes that Hoover’s had a “religious faith in the planless worlds of the free market” (Hofstadter 405).
The question of whether or not he did have this belief in the free market that Hofstadter and most historians, asserts he has can ultimately only be decided by his actions. While his aptitude for planning can be seen as early as his relief efforts in Europe during and following the First World War – “[w]ithout a man of Hoover's daring, declares Leuchtenburg, ‘many thousands would have starved to death’” (Hartman) – this activity took place within the context of a war; no country had remained laissez faire for the whole of World War I and all had planned economies to some regard. His activities during the peacetime following the war would reveal his actual tendencies rather than actions undertaken merely out of necessity. Although it has already been established that Hoover expanded the Secretaryship of Commerce significantly, the various measures he enacted and his attitude in context of his position need to be looked at critically.
After accepting the Cabinet position of Secretary of Commerce, Hoover quickly recognized “the necessity for energetic government action” (Zieger 174). This government action, however, was more advisory and was completely voluntary (for the most part), and this was how Hoover was able to call himself “both a ‘planner’ and an ‘anti-statist’” (Berkowitz and McQuaid 322). Yet, before the first half of the 19th century this would not have been possible; most American were very wary of encroachments by the federal government into before this time. For the first time though, but for this period that Hoover was Secretary “the need to control economic fluctuations was probably the most important issue of domestic economic policy in the United States” (Metcalf 80). Finding himself in a position where he would have not insubstantial control in some economic matters, Hoover quickly took initiative and began to issue “‘edicts that he had no authority to issue or that were forbidden by an act of Congress ... ordered all amateurs off the airwaves; empowered himself to issue licenses; and in contravention of both U.S. and international law ... assigned frequencies’” (Hartman). While these actions certainly do indicate a level of power seizing behavior, they do not necessarily show that Hoover denied capitalism and its merits: other actions show these features of his thought clearly. Explicitly denying “the ability of Adam Smith’s model of independent competition to meet to meet twentieth century American problems” he showed his desire for government to not only go “beyond emergency relief measures and seek means of preventing unemployment” but also to ensure “‘the better control of economic forces’” (Metcalf 61). Is it still plausible to believe that Hoover “had an ideological commitment to private, and local public, responsibility for solving social problems” although he spoke of a “need for ‘a national planning of industry and commerce’” (Metcalf 68)?
While he was Secretary of Commerce it was still plausible belief, and indeed was reflected in his actions. He “rejected genuine federal government direction of economic activity”, favored “voluntary trade associations” which he believed would be more responsible than individual firms, and only in a very few “extraordinary circumstances” allowed “private cooperative measures to superimpose collective decisions on individual business” (Metcalf 68-69). Besides his support of trade associations, most of what Hoover did was gather “[b]etter statistical information” and then give these statistics to the trade associations so that their decisions would be better informed and therefore reduce the severity of the business cycle (Metcalf 68). Still, these actions, which seem relatively hands off compared to the system in America today, were some of the first steps toward “the development of and dissemination of theoretical and statistical ‘economic literacy’” (Metcalf 71); that it was regarded that the central government needed to step in and educate industry heads about prevailing economic conditions was an important viewpoint for the public to hold in order to allow further encroachments of the public into the private. Limited as he was by his position as Secretary of Commerce it is impossible to say what Hoover may have done given broader powers during this time. It seems, though, even at this time it would not have been laissez faire; Hoover’s attempts at using federal powers for the sake of “economic stabilization” firmly established “the federal government’s responsibility for managing the performance of the economy as a whole” (Metcalf 80).
Because it is primarily Hoover’s presidency which most historians are critical of, and, coincidentally, where most of the allegations of his free market dogmatism stem from, this period should be looked at most critically. The belief that “Hoover’s political philosophy caused him to take a cautious approach to the depression” is one so widely accepted that a challenge to it is almost automatically discredited (The Americans 684); even Nobel Prize winner Paul Krugman falls somewhat into this trap when he stated, “the federal government tried to balance its budget in the face of a severe recession” with reference to Hoover and the Great Depression (Woods). Given the facts of the matter, however, it seems almost irresponsible to allow this misconception to continue; to quote Robert Murphy in reference to this misconception, “it would be difficult to render a more misleading account of Hoover's policies without actually lying” (Woods).
Any illusion of a laissez faire Herbert Hoover vanishes as soon as an inquiry into his reaction to the stock market crash of “Black Thursday” and the subsequent depression is made. Hoover immediately called a “series of White House conferences with the leading financiers and industrialists of the country, to induce them to maintain wage rates and expand their investments” (America’s Great Depression 210). These actions stemmed from a widely held belief that if wages were to drop then purchasing power, and therefore demand, would drop and this would further aggravate the depression. This proto-Keynesian explanation for depressions being caused by lack of demand had come into wide acceptances and many of the businesses which attended the various conferences abided by Hoover’s advice, voluntary though it was. Besides Hoover’s conferences the Federal Reserve was trying its hand, very much at Hoover’s behest, at using cheap credit to stimulate the market: it “added almost $300 million to the reserves of the nation's banks… doubled its holdings of government securities, adding over $150 million to reserves, and it discounted about $200 million more for member banks…The Federal Reserve also promptly and sharply lowered its rediscount rate, from 6 percent at the beginning of the crash to 4.5 percent by mid-November” (America’s Great Depression 214-215). Following his conferences “Hoover and Mellon also proposed to Congress an increase in the Federal Buildings program of over $400 million, and on December 3 the Department of Commerce established a Division of Public Construction to spur public works planning… [he] granted more subsidies to ship construction through the federal Shipping Board and asked for a further $175 million appropriation for public works” (America’s Great Depression 216-217).
All of this action was merely the first of many to be taken by Hoover, and most of theese were taken in the few months following the stock market crash. Continuing into 1930 Hoover signed the infamous Smoot-Hawley tariff which “initiated a violent implosion of world trade and prices” (Reynolds). On top of the draconian tariffs the Federal Reserve continued to inflate the money supply “from 4.5 percent in February to 2 percent by the end of the year” and the “[t]otal government depredations on the private product” of the gross private product increased 2.1% and 2.5% of the net private product (America’s Great Depression 240-255). Despite 1931 being “The Tragic Year”, the most activity in the Hoover Administration can be seen in 1932. Perhaps most frightening was that Hoover “asked for a temporary tax increase” which ended up translating to a raise in the marginal income tax rate from “25% to 63% and [a] quadrupling the lowest tax rate from 1.1% to 4%” (Reynolds). On top of this, the burden of government as a percentage of both private net and gross product was increasing, the Reconstruction Finance Corporation was created and funded lavishly, the Emergency Relief and Construction Act of July 1932 was passed (“the nation's first Federal relief legislation”), the Glass-Steagall Act was passed, The Federal Home Loan Bank Act was passed, bankruptcy law reforms were enacted, and a Securities and Exchange Commission was proposed by Hoover (America’s Great Depression 285-318).
None of these actions seem to indicate that Herbert Hoover held a laissez faire attitude at all; any look into the history of the Great Depression seems to attest against it, in fact. The only reasonable explanation, it seems, for why Hoover is mistakenly given the title of “laissez faire liberal” is that his interventions into the lives of American’s and the economy pale in comparison to Franklin Delano Roosevelt’s. It does not help the matter in the slightest to have widely known economists like Anna Schwartz and Milton Friedman perpetuating the “myth that Herbert Hoover sat idly back and watched the Depression unfold” which, to the detriment of all “is continuing to drive misguided policies today” because they saw these unprecedented government interventions “failing… to pump enough money into the system” (Woods). It is ironic, then, that Hoover spoke about a “false liberalism” in his book The Challenge to Liberty (“Think of a book on such a subject, by such a man!” Albert Jay Nock once exclaimed), because in showing that false liberalism “interprets itself into government dictation, or operation of commerce, industry and agriculture” he has forever doomed himself to be labeled by the term he meant to apply to FDR (Herbert Hoover Denounces the New Deal). No ending is more suitable for the end of this paper than a quote from Murray Rothbard: “Hoover did not fail to employ promptly and vigorously his "modern" political principles, or the new "tools" provided him by "modern" economists. And, as a direct consequence, America was brought to her knees as never before. Yet, by an ironic twist of fate, the shambles that Hoover abandoned when he left office was attributed, by Democratic critics, to his devotion to the outworn tenets of laissez-faire” (America’s Great Depression 207).