The Great Depression and the 1932 Election

An economic crisis became a crisis of everyday life

The Great Depression was a severe and prolonged economic downturn that followed the Wall Street Crash of 1929. Herbert Hoover, a Republican, became president that year. By the presidential election of 1932, the continuing crisis had undermined confidence both in his leadership and in the idea that prosperity would return without much federal intervention.

Economic and social effects were closely connected. Struggling businesses cut production and jobs; unemployment deprived households of wages. Families then had less money to spend, making it harder for businesses to find customers. Falling demand encouraged further cuts in production and employment, creating a downward spiral. By 1932, industrial production had fallen by about 45 per cent, and approximately a quarter of workers were unemployed.

For ordinary Americans, unemployment was not simply an economic statistic. Losing an income could mean hunger, inability to pay for housing and dependence on charity. Families used up savings, borrowed from relatives and struggled to pay rent. Eviction could leave them homeless or force them to move into already struggling relatives’ homes.

Bread lines and soup kitchens became visible signs of hardship, but private charities could not meet the enormous demand. Some homeless people lived in makeshift shacks gathered into settlements called Hoovervilles. Newspapers used as blankets were mockingly called ‘Hoover blankets’, while empty trouser pockets turned inside out became ‘Hoover flags’.

These names turned suffering into political criticism. They suggested that Hoover was responsible for failing to relieve people’s hardship, even though the Depression was not simply the result of one president’s decisions.

Bank failures destroyed savings and deepened the crisis

Banks suffered when borrowers could no longer repay their loans. Fear of bank collapse also encouraged depositors to rush to withdraw their savings. Banks unable to meet these demands could be forced to close, leaving customers without their money. Around 5,000 banks closed between 1930 and 1932.

For a family, losing savings meant losing the reserve that might have paid for food or rent during unemployment. For businesses, bank failures could destroy deposits and make borrowing harder, threatening their ability to continue trading. The banking crisis therefore intensified both economic decline and household hardship.

Farming families lost incomes, land and homes

Farmers had already faced overproduction and low prices before the crash. During the Depression, falling crop prices reduced their incomes further. Producing more to try to cover their costs could add to the surplus and push prices down again. Retaliatory tariffs also made overseas markets harder to reach.

Many farmers had borrowed money to buy land or machinery. When crop sales no longer brought in enough to meet mortgage repayments, banks could take their farms through foreclosure. Farming families could therefore lose their livelihood and their home together. Some abandoned their land and travelled elsewhere looking for work.

In the Great Plains, drought beginning in 1931 made these problems worse. Earlier ploughing had removed native grasses that protected the soil. Drought and strong winds then helped create devastating dust storms, destroying crops and carrying away topsoil. This environmental disaster became known as the Dust Bowl. It compounded the economic Depression rather than causing the nationwide crisis.

Hardship was also unequal. African Americans faced discrimination when competing for scarce jobs: some white employers and workers insisted that available work should go to white people first. In farming, falling crop prices meant lower wages, dismissals and the eviction of sharecroppers. Existing discrimination therefore made the Depression especially severe for Black families.

Why Hoover resisted direct federal relief

Hoover believed in rugged individualism: people should be self-reliant rather than dependent on government. He expected individuals, private charities and local communities to play the main role in helping those in need. He also favoured a balanced budget, making him reluctant to commit large amounts of federal money to relief.

This approach depended on assistance outside the federal government being sufficient. As unemployment and homelessness spread, critics argued that the scale of the crisis overwhelmed what individuals and charities could provide. The dispute was therefore about the relationship between the people and the state: should the national government accept greater responsibility for people’s welfare?

Hoover initially treated the downturn as a temporary setback and emphasised its international causes. His optimism became less convincing as hardship continued. Nevertheless, describing his response as complete inaction would be inaccurate.

Hoover’s measures and their limitations

The Hawley–Smoot Tariff Act of 1930 raised taxes on imported goods. Its intention was to encourage Americans to buy American products, protecting domestic producers and employment. However, other countries retaliated with tariffs of their own. This made international trade more difficult and worsened the trading conditions facing American businesses and farmers.

In 1932, Hoover established the Reconstruction Finance Corporation (RFC). It lent money to banks, businesses and railways threatened with collapse. The reasoning was that stabilising these important institutions would help the wider economy. Critics, however, saw assistance reaching large organisations while ordinary unemployed people still lacked adequate help.

Hoover also made funds available to state governments for public works, such as roads and schools. Such construction could provide employment, but the limited use of available funds weakened its impact. These measures show that Hoover did intervene; the central criticism was that his response was insufficient and did not relieve hardship quickly enough.

The Bonus March damaged Hoover’s reputation

In 1932, unemployed First World War veterans gathered in Washington, DC, seeking early payment of their war bonuses. Hoover opposed their demand. The confrontation ended with troops under General Douglas MacArthur driving the protesters from their camps, using military force and tear gas.

The treatment of former servicemen intensified anger towards Hoover. Alongside unemployment and the Hoovervilles, the Bonus March gave voters another reason to see his administration as unable or unwilling to respond sympathetically to suffering.

Two contrasting campaigns in 1932

The election offered a choice between Republican Herbert Hoover and Democrat Franklin D. Roosevelt, the governor of New York. Hoover had to defend his record; Roosevelt could present himself as an alternative.

Hoover argued that the Depression arose from the aftermath of the First World War and that his measures had prevented a complete economic collapse. He warned that Roosevelt’s proposals would create an overly powerful, centralised federal government and threaten individual liberty. The Republican platform defended a balanced budget and protective tariffs.

Hoover delivered nine major campaign addresses. His speeches relied heavily on statistics and explanations of his record, but they did little to restore public confidence. His defence of existing policies struggled to appeal to people experiencing continuing hardship.

Roosevelt instead offered optimism and the promise of ‘a new deal for the American people’. He flew to the Democratic convention in Chicago to accept the nomination in person, breaking with tradition and presenting himself as an energetic leader despite the effects of polio.

His campaign did not provide a detailed blueprint for all the programmes that would follow. Its strength was the promise of a different approach. In his September 1932 Commonwealth Club speech, Roosevelt argued that the federal government must accept responsibility for national welfare and help create an economy in which working people could earn a comfortable living.

The contrast was therefore more than one of personality. Hoover warned against excessive federal power; Roosevelt argued for greater federal responsibility. Roosevelt’s hopeful speeches also contrasted with Hoover’s defensive tone.

Why Roosevelt won

Roosevelt won a landslide, carrying 42 of the 48 states and defeating Hoover by about seven million votes. Democrats also secured substantial majorities in both houses of Congress.

The result reflected dissatisfaction with Hoover’s handling of the Depression and the appeal of Roosevelt’s promise of change. Continuing hardship, the limited impact of Hoover’s measures and the Bonus March all weakened the president’s position. Roosevelt offered hope without having to defend the federal government’s record.

The victory did not itself end the Depression. Roosevelt took office in March 1933, when responsibility for tackling the crisis passed to him. The election marked a turning point towards a more active federal role, but the effectiveness of that approach depended on the policies that followed.

Depression: economic and social effects

• By 1932, industrial production had fallen about 45% and roughly a quarter of workers were unemployed.
• Falling demand → production cuts → unemployment → lower household spending.
• Bank failures: savings lost; businesses struggled to obtain credit. Around 5,000 banks closed, 1930–1932.
• Farmers: falling crop prices → unpaid mortgages → foreclosure, loss of homes and migration. Great Plains drought from 1931 compounded hardship.
• Hunger, bread lines and homelessness exposed the human cost. African Americans faced additional discrimination over scarce jobs.
• Hoovervilles, ‘Hoover blankets’ and ‘Hoover flags’ expressed blame towards Hoover.

Hoover’s response

• Beliefs: rugged individualism, local and charitable relief, balanced budgets.
• 1930 Hawley–Smoot Tariff: intended to protect American producers; retaliation worsened international trade.
• 1932 RFC: loans to banks, businesses and railways; criticised for helping large organisations rather than directly relieving ordinary people.
• Public-works funding had limited impact.
• 1932 Bonus March: troops under MacArthur dispersed veterans seeking early bonus payments, further damaging Hoover’s reputation.

The 1932 campaigns

• Hoover, Republican: defended his record, stressed international causes and warned that Roosevelt threatened liberty through centralised government. Nine major addresses; defensive, statistics-heavy speeches.
• Roosevelt, Democrat: optimistic leadership and a promised New Deal; appeared personally at the Democratic convention and argued for greater federal responsibility for welfare. Few detailed programmes were specified during the campaign.

Result and significance

Roosevelt won 42 of 48 states, with a lead of about seven million votes. Dissatisfaction with Hoover combined with Roosevelt’s appeal as an alternative. Roosevelt took office in March 1933; victory enabled change but did not itself end the Depression.