HIST 102 1st Edition Lecture 13Outline of Last Lecture A. The 1920s and EconomyB. The 1920s and PoliticsC. The 1920s and CultureD. The 1920s and ProhibitionE. The Scopes Trial 1925Outline of Current LectureI. 1928 Election of HooverII. Hoover’s PresidencyIII. More Red FlagsIV. The Great CrashV. Hoover and the First Bonus ArmyCurrent LectureI. 1928 Election of HooverA. Republican candidate Herbert Hoover campaigned on a platform as a self-made mani. A Quaker, he was also an orphan who overcame his circumstances and went to Stanford and became a brilliant math/mining engineerii. He was a dry candidate and religious (Christian).iii. he wanted to cut taxes and keep tariffs highB. Democrat Al Smith campaigned as a “man of the people”i. Several time governor of New York, he was nominated by FDR ii. He was known as a “wet”/pro-alcohol candidate, earning him the nickname Al-coholic Smith from the opposition iii. His Catholic beliefs and New York accent were unpleasant to Americans and may have contributed to his loss, especially after a 1928 debate over the radio, which was a new innovation.C. Hoover won by a landslidei. Hoover was able to ride on the Republican momentum of good favor withthe American people due to a healthy economy.II. Hoover’s PresidencyThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.A. Hoover was blamed by many for the crash, which is still a misconception todayi. Until about 1929, Hoover was associated with good things, i.e., to “Hooverize” something, or make it betterii. After the stock market crash, he became associated with negative things, such as “Hoovervilles”, or poor neighborhoods of shacksB. Once president, he made some “questionable” actionsC. Agricultural Marketing Act in 1929i. This was an attempt to help farmers by stabilizing pricesD. Hawley Smut Tariff was the highest protective tariff in U.S. history, intended to help the industryi. Raised the tariff to 60%ii. Making foreign goods more expensive was not necessarily beneficialIII. More red flagsA. In 1927, house, building, and auto sales all plateaued, then droppedi. Industry should have slowed production to meet the lower demand, but it did notii. Sales continued to plummetiii. With no demand, companies began to lay off employees, and unemployment roseB. The Great Bull Market, as it was called (versus a bear market), meant that people invested in everything and the market went upi. 20-25% interest began to quadruple, and people began to owe their brokersii. The Federal Reserve declared no more loans and interest rates went up to20%IV. The Great CrashA. Black Thursday on October 24, 1929 saw a serious drop in the stock marketi. People began panic selling as their life savings/retirement funds were in the stock marketii. The deluge of sales created a vacuum in the marketiii. Bankers demanded payment from stock brokers, who called their clientsB. By Friday, it stabilized, then dropped Monday and crashed again Tuesdayi. On Tuesday, it completely “bottomed out” and investors lost everythingii. The amount of money lost was twice the amount in actual circulationC. Panic was not as severe as perceived todayi. The New York Times’ declared its most important story of 1929 the one about the first man to visit the South Pole—not the stock market crashii. Today we tend to overemphasize reactions to the crash (suicide, etc.)iii. As a confidence indicator, consumer spending for Christmas were highiv. People were unaware of how bad things wereD. Causes to the Crashi. Huge gaps/mal-distribution of wealthii. New industry technology decreased the amount of available jobsiii. No regulation on banks/stock market—many laws today were out of response to the depressioniv. Many Americans had debt from spending so much on credit—in 1928 the majority of major products were bought on installment plansv. In agriculture, there was a surplus that caused a downward spiral of profitand financial stability for farmersvi. There had already been an international market depression that was finally catching up to the previously prosperous U.S. as foreign countries stopped buying from the U.S. after it increased its pricesvii. In addition to unemployment, there was severe underemployment—people were not able to work as much as the jobs they did haveE. Hoover’s Responsei. Historically, he does not get much credit for his actionsii. Still did more than any previous president had to fix economic crisesiii. He was limited by Republican ideals (help the big corporations/rich class, follow “trickle down” concepts)iv. Hoover only directed help to a few groups a little too late and did not takethe scale of action necessary to have a significant impactv. Hoover was blamed for the ills of the country, with “Hoover flag” becoming the term for empty pocketsvi. He experienced a huge drop in popularityV. Hoover and the First Bonus ArmyA. In 1924, Congress passed legislation that promised WWI veterans “bonus” compensation for serving in the wari. This was promised during more prosperous timesii. A group of veterans marched on Washington to demand their money earlyiii. Congress declined as there was no money to pay themiv. The veterans set up an encampment to protestv. Hoover sent the Army to clear out, with General Douglas McArthur leading and convinced the situation was severevi. The Army turned tanks on the vets, killing many and burning the campvii. The public saw that the American government had attacked veterans—in an election