From New Era to New Deal: Herbert Hoover, the Economists, and American Economic Policy, 1921-1933

William J. Barber

Cambridge University Press, 1988 - Biography & Autobiography - 237 pages

In popular imagery, Herbert Hoover is often stereotyped as a 'do-nothing' president who offered only nineteenth-century slogans for the greatest economic catastrophe in twentieth-century American history. Nothing could be further from the truth. This study examines the properties of an innovative approach to economic growth and stability formulated by Hoover and his associates during his years as secretary of commerce (1921-9) and inspects his deployment of this strategy from the White House following the Great Crash in the autumn of 1929. Attention is then focused on Hoover's attempts to reformulate his macro-economic programme as the depression deepened in late 1931 and 1932. Archival materials provide arresting insights into Hoover's aspirations for a new institution - the Reconstruction Finance Corporations - as a vehicle for stimulating investment through a novel form of 'off-budget' financing. To complement the discussion of Hoover's theories of economic policy in their various manifestations, the views of contemporary economists on problems of the day are surveyed.

Contents

• The Vision of a New Era in the 1920s: 1
• The ingredients of a model of a new economics: 7
• The role of economic information: 8
• The technocratic aspect of the attack on waste: 13
• new dimensions of fiscal policy: 15
• Puzzles over the place of monetary policy in macroeconomic stabilization: 23
• New era doctrine on wage determination and income distribution: 27
• Defining Americas position in the international economic system: 31
• The end of laissez faire in the 1920s?: 40
• Challenges to the new economics of the 1920s: 42
• Doubts about the highwage doctrine: 46
• The special case of agriculture in the income distribution: 48
• Critiques of the fiscal strategy for economic stabilization: 53
• Doubts about economic stabilization through monetary management: 58
• Questions about the neomercantilist component of Hooverism: 62
• The new economics at center stage in 1929: 65
• Organizing for action on the unfinished business: 69
• Concern about the stock market: 71
• Alternative readings of the stock markets behavior: 74
• Activating the stabilization model in late 1929 and 1930: 78
• Demand management Hooverstyle: 80
• Stabilization through confidence building: 82
• Bolstering aggregate demand through wage policy: 84
• The place of tax reduction in administration thinking in 1929: 85
• The initial responses of economists: 87
• Preliminary readings of the results of the stabilization strategy: 92
• Canvassing for further policy options: 95
• Appraisals from the economics profession: 99
• The unraveling of the first official model in 1931: 104
• Presuppositions and realities: 105
• Fiscal stimulus without design in 1931: 108
• Symptoms of disarray in the banking system: 111
• Storm clouds from abroad: 114
• The collapse of official model I: 118
• Realignments on the outside: 120
• Shifting course in late 1931 and early 1932: 125
• step I: 126
• step II: 129
• Financial reconstruction and the reformulation of fiscal policy: 132
• A reversion to orthodoxy?: 135
• Renewing the offensive in February and March 1932: 139
• FebruaryMarch 1932: 140
• Failure of the antihoarding campaign: 142
• The anatomy of failure from a White House perspective: 144
• The economists and their views on policy for 1932: 146
• Fiscal activism in a new key: 147
• The economists and a more modest proposal for a public works program in 1932: 151
• Polling on monetary questions and the statement of the Chicago position: 155
• Conflicting interpretations from the heavyweights in monetary theory: 157
• The voice of Alvin Hansen as an exponent of neoclassical orthodoxy: 162
• Protests against relaxation of the antitrust laws: 165
• Challenges and responses: 167
• Official model II as shaped in May 1932 and the aftermath: 169
• Reformulation of the functions of the Reconstruction Finance Corporation: 170
• The attempt to promote official model II: 174
• New tools and their effectiveness or lack thereof: 180
• Rearguard actions in the final phases of the Hoover administration: 185
• Transition to the New Deal continuities and discontinuities: 189
• Notes: 197
• Selected bibliography: 231
• Index: 233

Bibliographic information

• Title: From New Era to New Deal: Herbert Hoover, the Economists, and American Economic Policy, 1921-1933; Historical Perspectives on Modern Economics
• Author: William J. Barber
• Edition: illustrated, revised
• Publisher: Cambridge University Press, 1988
• ISBN: 0521367379, 9780521367370
• Length: 237 pages
• Subjects: Biography & Autobiography / Presidents & Heads of State; Business & Economics / Economic Conditions; Business & Economics / Economic History; History / Americas (North, Central, South, West Indies); History / Modern / 20th Century / General; History / United States / 20th Century