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Thread: Herbert Hoover & Austerity

  1. #1

    Default Herbert Hoover & Austerity

    Can anyone find a way to torture out how one might come to the conclusion that Herbert Hoover conducted "austerity" during his presidency and in response to the great depression? I see Krugmann continue making this point but I honestly can't find any fact of any kind that even remotely supports this. Anyone want to give this a shot?
    E che sospiri la libertà!

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  3. #2


    I do not think it can be done , but , if he had listened to his Treasury Sec. , maybe.

  4. #3


    I think THIS might be what you're looking for. Paul Forked-Tongued Krugman took quotes disingenuously out of context, and with all the intellectual dishonesty he could muster and is known for, tortures them into a revisionist framework full of creepy crawlies and leaps of logic.

    EXCERPTS: (beginning with the Conclusion at the end, emphasis mine)

    One of the persistent myths of American history is that Herbert Hoover was a laissez-faire ideologue who did nothing to help the economy recover from Depression. On the contrary, Hoover was in many ways a "progressive" who believed the federal government could intervene to dampen the cruel vicissitudes of the wildcat free market.

    If only Hoover had followed the hands-off policies of his predecessors, we would not today associate him with the worst episode in US economic history.


    First of all, let's go back to Krugman's discussion of Treasury Secretary Andrew Mellon and his infamous advice about liquidation. To his credit, Krugman acknowledges that this quote comes from Hoover's own memoirs, written well after the fact. But to his discredit, Krugman fails to notify us that on the very next page of Hoover's memoirs, after he explains the liquidationist advice he got from his treasury secretary, Hoover wrote,

    Quote Originally Posted by Hoover
    But other members of the Administration, also having economic responsibilities — Under Secretary of the Treasury Mills, Governor Young of the Reserve Board, Secretary of Commerce Lamont and Secretary of Agriculture Hyde — believed with me that we should use the powers of government to cushion the situation.
    If you read Hoover's memoirs in context, you see that his whole point in bringing up the Mellon doctrine was to tell his readers that he rejected the advice. Hoover was trying to show people (and of course I'm paraphrasing here), "Hey, I did everything I could to get us out of that awful downturn! You should have seen the crazy laissez-faire stuff my treasury secretary was recommending."

    Last edited by Steven Douglas; 11-26-2012 at 12:30 AM.

  5. #4


    An interesting debate on the topic with lots of info:
    Quote Originally Posted by NorthCarolinaLiberty View Post

    Half the crap I write here is just to entertain myself.
    I am Zippy and I approve of this post. But you don't have to.

  6. #5


    Get this book. It is a simple read, but filled with tons of info.

  7. #6


    I am reading America's Great Depression by Murray Rothbard right now. How anyone could conclude that Hoover was a laissez-faire president is pretty much mind boggling. I plan on sharing my notes when I am finished (almost there) but off the top of my head and without the dollar numbers you have:

    - Farm Subsidies (and the new government agencies that came with them)
    - Tariffs (highest in American history)
    - Public works (Hoover Dam, anyone?)
    - Pro-inflation (the money supply increases under Hoover were epic in scale)
    - Immigration Bans
    - Remember that the New Deal was just an extension of what Hoover established

    On immigration.. "On September 9, Hoover took an unusual step: to relieve the unemployment problem, and also to help keep wage rates up, the
    President effectively banned further immigration into the United States, and did so through a mere State Department press announcement. The decree barred all but the wealthiest immigrants as “public charges,” in a few months reducing immigration from Europe by 90 percent." - America's Great Depression

    "He hailed the Federal Reserve System as the great instrument of promoting stability, and called for an “ample supply of credit at low rates of interest,” as well as public works, as the best methods of ending the depression." - AGD

    "President Hoover, often considered to be a staunch exponent of laissez-faire, had amassed by far the largest peacetime deficit yet known to American history." - AGD

    "Hoover established an Emergency Committee for Employment in October, 1930, headed by Colonel Arthur Woods. Woods was a trustee of the Rockefeller Foundation and of Rockefeller’s General Education Board." - AGD

    "If he wanted to balance the budget, Hoover had two choices open to him: to reduce expenditures, and thereby relieve the economy of some of the aggravated burden of government, or to increase that burden further by raising taxes. He chose the latter course. In his swan song as Secretary of Treasury, Andrew Mellon advocated, in December, 1931, drastic increases of taxes, including personal income taxes, estate taxes, sales taxes, and postal rates. Obedient to the lines charted by Mellon and Hoover, Congress passed, in the Revenue Act of 1932, one of the greatest increases in taxation ever enacted in the United States in peacetime." - AGD

    "on February 3, Hoover organized an anti-hoarding drive, headed by a Citizens’ Reconstruction Organization (CRO) under Colonel Frank Knox of Chicago." - AGD

    "Having warned the Exchange of a Congressional investigation, Hoover induced the Senate to investigate the Stock Exchange, even though he admitted that the Federal Government had no constitutional jurisdiction over a purely New York institution." - AGD

    Real laissez-faire, right? LOL. These were just a few random things I highlighted on my Kindle. They only scratch the surface.

    I really can't recommend this book enough

    Also, along with a link to Rothbard's book, send this to anyone who claims Hoover was laissez-faire:

  8. #7


    Quote Originally Posted by cubical View Post
    Get this book. It is a simple read, but filled with tons of info.
    Agree ^^^ very good book. Its simple, clear, short, very well written. Bob Murphy knows his stuff.

  9. #8


    Quote Originally Posted by Zippyjuan View Post
    An interesting debate on the topic with lots of info:
    Thank's for the tip. Which position do you take?
    Quote Originally Posted by BuddyRey View Post
    Do you think it's a coincidence that the most cherished standard of the Ron Paul campaign was a sign highlighting the word "love" inside the word "revolution"? A revolution not based on love is a revolution doomed to failure. So, at the risk of sounding corny, I just wanted to let you know that, wherever you stand on any of these hot-button issues, and even if we might have exchanged bitter words or harsh sentiments in the past, I love each and every one of you - no exceptions!

    "When goods do not cross borders, soldiers will." Frederic Bastiat


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