Changes

==Presidency: Great Depression==

==Presidency: Great Depression==

Hoover later came under sustained and intense attack that he did nothing to reverse the depression. He tried any number of approached—but none worked and the economy continued to spiral downward.  His basic assumption, from 1929 to 1931, was that it was a temporary short cycle, and like all previous downturns would end shortly. Meanwhile, his job was to maintain public optimism, because pessimism would make people cut back further and prolong the downturn. Hoover was using the best available economic knowledge.  

 

 

Hoover later came under sustained and intense attack that he did nothing to reverse the depression. He tried any number of approached—but none worked and the economy continued to spiral downward.  His basic assumption, from 1929 to 1931, was that it was a temporary short cycle, and like all previous downturns would end shortly. Meanwhile, his job was to maintain public optimism, because pessimism would make people cut back further and prolong the downturn. Hoover was using the best available economic knowledge.

 

===Expanding public works===

===Expanding public works===

Hoover in late 1930 created The President's Emergency Committee on Employment (PECE), as unemployment reached 11%.<ref>Estimates of unemployment were only roughly approximate before 1933.</ref>  PECE tried to mobilize private charity and encouraged states, cities and Congress to increase public works spending as a stimulus.  They did so, and soon the states and cities were nearly bankrupt on their own. In August 1931, finally realizing this was not a normal cycle, Hoover replaced PECE with the President's Organization on Unemployment Relief (POUR), headed by Walter S. Gifford, president of American Telephone and Telegraph, the nation's largest private company.  POUR expanded, coordinated, and improved local and state relief efforts; but the economy relentlessly went lower.  

Hoover in late 1930 created The President's Emergency Committee on Employment (PECE), as unemployment reached 11%.<ref>Estimates of unemployment were only roughly approximate before 1933.</ref>  PECE tried to mobilize private charity and encouraged states, cities and Congress to increase public works spending as a stimulus.  They did so, and soon the states and cities were nearly bankrupt on their own. In August 1931, finally realizing this was not a normal cycle, Hoover replaced PECE with the President's Organization on Unemployment Relief (POUR), headed by Walter S. Gifford, president of American Telephone and Telegraph, the nation's largest private company.  POUR expanded, coordinated, and improved local and state relief efforts; but the economy relentlessly went lower.  

In early 1931 Hoover signed the Wagner-Graham Stabilization Act, which set up the Federal Stabilization Board to initiate public works such as dams and highways. Public works did increase throughout the decade after 1929, but not enough to cover the downturn in private construction, let alone all the other negative sectors.  In 1931 the mood in Congress—equally divided after the GOP lost seats in 1930—remained strongly opposed to federal relief; even the National Council of Social Workers refused to endorse relief as a principle at their convention in May. New urban slums—shantytowns derisively called Hoovervilles by the Democrats—were rising in the nation's largest cities.

In early 1931 Hoover signed the Wagner-Graham Stabilization Act, which set up the Federal Stabilization Board to initiate public works such as dams and highways. Public works did increase throughout the decade after 1929, but not enough to cover the downturn in private construction, let alone all the other negative sectors.  In 1931 the mood in Congress—equally divided after the GOP lost seats in 1930—remained strongly opposed to federal relief; even the National Council of Social Workers refused to endorse relief as a principle at their convention in May. New urban slums—shantytowns derisively called Hoovervilles by the Democrats—were rising in the nation's largest cities.

===Mortgages===

===Mortgages===

Hoover had played a major role in creating the long-term (20-year) mortgage in the 1920s. In times of prosperity mortgages accelerated national growth, as houses were built and lived in before people had saved enough to pay cash for one.  But in a downturn mortgages debt hurt the economy. people sacrificed current consumption to pay the mortgage so they would not lose the house and all the money they put in it. To pay the mortgage they gave up luxuries (like a telephone or new car), made do with old clothes, canceled vacations. The foreclosure rate pushed up and construction of new houses ceased.  It was much like 2008-09.  Like President Obama, Hoover moved to resolve the mortgage crisis. He called for the Federal Home Loan Bank Act (passed in  July 1932), that created a system of federal home loan banks to discount home mortgages. The Federal Home Loan Banks received $125 million in capital (comparable to $32 billion in 2009) to fund the home mortgages held by financial concerns.<ref>The "comparable" figures here are calculating by taking the same % of the GDP in 2009 as the sum was a % of GDP in 1930, 1931 or 1932.  This can be found by using these multipliers: to compare spending in 1929 versus 2009, multiply by 146; use 167 in 1930; 197 in 1931; 259 in 1932, and 268 in 1933.</ref>  Hoover believed that the ability of private lending institutions to secure new sources of capital would encourage them to make more construction loans and revive the industry. But it had little effect.

Hoover had played a major role in creating the long-term (20-year) mortgage in the 1920s. In times of prosperity mortgages accelerated national growth, as houses were built and lived in before people had saved enough to pay cash for one.  But in a downturn mortgages debt hurt the economy. people sacrificed current consumption to pay the mortgage so they would not lose the house and all the money they put in it. To pay the mortgage they gave up luxuries (like a telephone or new car), made do with old clothes, canceled vacations. The foreclosure rate pushed up and construction of new houses ceased.  It was much like 2008-09.  Like President Obama, Hoover moved to resolve the mortgage crisis. He called for the Federal Home Loan Bank Act (passed in  July 1932), that created a system of federal home loan banks to discount home mortgages. The Federal Home Loan Banks received $125 million in capital (comparable to $32 billion in 2009) to fund the home mortgages held by financial concerns.<ref>The "comparable" figures here are calculating by taking the same % of the GDP in 2009 as the sum was a % of GDP in 1930, 1931 or 1932.  This can be found by using these multipliers: to compare spending in 1929 versus 2009, multiply by 146; use 167 in 1930; 197 in 1931; 259 in 1932, and 268 in 1933.</ref>  Hoover believed that the ability of private lending institutions to secure new sources of capital would encourage them to make more construction loans and revive the industry. But it had little effect.