Some administration remedies, like the Hawley-Smoot Tariff, which Hoover signed with some reluctance in 1930, made the economic situation worse. Raising the already high taxes on imported goods, it inspired similar increases abroad, further reducing international trade. A tax increase Hoover pushed through Congress in 1932 in an attempt to balance the federal budget further reduced Americans’ purchasing power. Other initiatives inspired ridicule. When he approved funds to provide food for livestock, one observer remarked that the president would feed “jackasses but... not starving babies.”

An unemployed man and woman selling apples on a city street during the Great Depression.

By 1932, Hoover had to admit that voluntary action had failed to stem the Depression. He signed laws creating the Reconstruction Finance Corporation, which loaned money to failing banks, railroads, and other businesses, and the Federal Home Loan Bank System, which offered aid to home owners threatened with foreclosure. Having vetoed previous bills to create employment through public-works projects like road and bridge construction, he now approved a measure appropriating nearly $2 billion for such initiatives and helping to fund local relief efforts. These were dramatic departures from previous federal economic policy. But further than this, Hoover would not go. He adamantly opposed offering direct relief to the unemployed—it would do them a “disservice,” he told Congress.

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