156 ChaPter 3
Hoover’s policies as president did not cause the depression—the data we have
already seen shows that—but nor was he uncaring or distant. Hoover did
respond to the economic crisis of the 1930s in various ways, yet all were ulti-
mately ineffective.
Hoover might have believed in government-business collaboration in trade
associations and such, but he did not believe it was the state’s role to take over
and fix the economy, and he did not see the crisis as grave at first [describing
it as a market “correction,” as did Keynes] and called for “voluntary coopera-
tion.” He asked factories and farms to continue production, not lay off work-
ers, not reduce wages, and for all Americans to keep buying goods. After
briefly going along with Hoover’s request, those big firms halted or reduced
production, laid off millions of workers, and seriously reduced wages, building
up their already surplus capital. And the average worker did not have enough
money to buy much more than food and shelter, if that. The problem with
capitalism, as Hoover well knew, was the “damn greedy” capitalists. Voluntary
efforts would not work. Yet Hoover was facing a situation in which at least
a quarter of all workers were unemployed, production was down by at least
half, and investment had virtually disappeared, down by over 95 percent.FIGuRE 3-10 A “Hooverville” in Portland, Oregon