Herbert Hoover: “The Consequences of the Proposed New Deal”

Explanation and Analysis of the Document

On the eve of the 1932 presidential balloting, Hoover was extremely unpopular and personally disenchanted with the office. However, he deeply feared that politicians from either party were far too willing to compromise in efforts to garner public support. Hoover initially planned only a limited campaign, since he wanted to devote his attention to the Depression. As Roosevelt's popularity steadily increased and his own standing diminished, Hoover became more aggressive on the campaign trail. In a speech at Madison Square Garden on October 21, 1932, Hoover passionately defended his administration while attacking his opponent and the Democrats in general.

Hoover endeavored to cast the election in ideological terms. He declares at the beginning of his address that the upcoming balloting would be a “contest between two philosophies of government.” Through the speech, Hoover criticizes many of Roosevelt's campaign promises and various plans put forth by congressional Democrats. For instance, the incumbent derides a proposal passed by Democrats in the House whereby the government would issue $2.3 billion in paper currency without backing. Hoover claims the initiative would create high inflation and notes that when the government did this after the Civil War, it created financial havoc. (Roosevelt took the nation off the gold standard after he was elected.)

The president also points out differences with his opponent on the government's role in public utilities. Hoover steadfastly maintains that private companies should manage electric power or water services and vetoed a bill that would have launched a large program to expand electricity through rural areas of the South. He believed that the government's role was to create favorable conditions that would prompt private companies to expand, but he argues that a government-run utility company would be more expensive than its private-sector counterpart and prone to waste and inefficiency. Roosevelt supported government-run efforts to provide electricity to areas that did not have service. Once in office, his administration created the Tennessee Valley Authority, which was responsible for expanding electrical service through many areas of the Deep South.

Throughout his campaign speech Hoover stresses the inappropriateness of government involvement in the private sector. He notes that as elected officials, members of Congress were under constant pressure from their constituents to secure privileges and benefits, and such pressure could undermine the effectiveness of corporations or firms if they were subject to significant government oversight. Hoover states that when the government becomes involved in a business or corporation, “531 Senators and Congressmen become actual boards of directors of that business.”

Hoover argues that during times of prosperity, people tended to pay little attention to the importance of rights and liberties. Furthermore, during difficult times, people often sought immediate government action to solve problems, even at the expense of individual rights and freedom. The result was a steady erosion of liberties and freedoms. He reminds people, “It is men who do wrong, not our institutions.”

In the 1932 election Roosevelt defeated Hoover with 57.4 percent to 39.7 percent of the popular vote. In addition, in the House, Democrats increased their majority to 313 seats, to 117 for the Republicans. (The Farmer-Labor Party secured five seats.) Republicans lost control of the Senate as the Democrats gained twelve seats. Hoover sought to work with the incoming administration in the interregnum between the election and the inauguration; however, Roosevelt rebuffed his predecessor's offers and instead developed an ambitious agenda, which he launched during his first one hundred days in office. Meanwhile, Hoover left office disgraced and determined to avoid public life.