White House officials for some time have been drawing comparisons between the 44th president of the United States, Barack Obama, and the 40th, Ronald Reagan. A truer comparison would be President Obama and Herbert Hoover.
For the past year, I have been researching how the housing bubble of the 1920s contributed to the Great Depression. My study has involved reading numerous articles and speeches by and about Hoover, first as commerce secretary (1921-28), then as president (1929-1933).
The parallels with our current president are astounding.
Hoover, a graduate of Stanford University, was a successful mining engineer who traveled the world until he returned to the United States during World War I. After the war, he organized relief efforts that saved millions from starvation across postwar Europe. A journalist described Hoover as a progressive who “dreams of social justice.”
Franklin D. Roosevelt, then assistant secretary of the Navy, wanted Hoover to run for president in 1920, as a Democrat. FDR considered Hoover “a wonder … I wish we could make him President of the United States. There couldn’t be a better one.”
With his broad portfolio, Hoover became a gadfly, lecturing trade associations on how to eliminate “waste.” He encouraged young FDR to take the helm of the American Construction Council - the umbrella trade association for construction.
Roosevelt thought Hoover's “scientific” approach to business was better than competitive capitalism. The American people were equally enamored. Despite signs of an economic slowdown, especially in housing, voters in 1928 elected the “brainy idealist” president.
For his part, Hoover promised a “triumph over poverty.” When the economy tanked, he increased government spending, cut taxes, bailed out businesses “too big to fail,” and proposed a massive infrastructure bank to employ men in shovel-ready jobs. Contemporaries called this stimulus package “priming the pump.”
Yet unemployment soared, and the GOP lost control of the House of Representatives in 1930. Hoover blamed his woes on the international economic situation and his political opponents. Sound familiar?
Both men can be characterized, impolitely perhaps, as know-it-alls. Is it any wonder that their presidential wizardry failed to impress business?
Outlook magazine, then one of the pre-eminent journals of news and opinion, asked a banker why so many businessmen opposed Hoover's candidacy. The banker said his firm “has many textile manufacturers as clients … but nobody in the bank would presume to tell our customers how to make rayon.”
Yet Hoover was “confident that he knows more about finance than financiers, more about industry than industrialists, and more about agriculture than agriculturists. He is so sure of his judgment in these fields that he wants to impress it on others. He is very seldom willing to take advice. Since he knows more than any advisers could, why should he?”View Entire Story
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By Andrew P. Napolitano
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