Harding told Hoover that his main goal for his Presidency was to lift the national spirit and sense of unity, which meant reining in the previous decades of tumult and attempted reforms, replacing it with “Normalcy”. Harding tried to soothe as many factions as possible in order to achieve that goal, but “Normalcy” had no room for large ideas or grand ambitions, which didn’t match Hoover’s belief that the US needed to be bold and decisive. For the hard-working and ambitious Hoover, SecCommerce was a seemingly dead-end post. Commerce was the lowest-ranking department in the Cabinet, created on President Taft’s last day in office on 3 March 1913, and SecCommerce was always the last to report to the President in Cabinet meetings.
Hoover immediately started to transform the Commerce Department, not seeing his position as low or menial, since it was plain that he had oversight of the US economy. Hoover was not going to miss the chance to remake the department (and himself) into a much bigger deal. Hoover’s self-appointed mission was to improve the nation’s business so all citizens would benefit. Hoover understood that the US economy was a myriad of connected systems networks, and he wondered how much the economy could improve if even some of his wartime policies were transferred to peacetime.
To Hoover, it was clear that the consumer was the driving force for the US economy, and also that regional economic problems could quickly become national economic problems. Hoover viewed Commerce (and the government) as the driving agent that would oversee and regulate the national economy so those regional problems would not cause national distress. Over time, Hoover was able to squeeze funding out of Congress to grow the Commerce Department, and everywhere in his dominion, Hoover eliminated political hacks - merit was the rule for Commerce.
Hoover immediately started to transform the Commerce Department, not seeing his position as low or menial, since it was plain that he had oversight of the US economy. Hoover was not going to miss the chance to remake the department (and himself) into a much bigger deal. Hoover’s self-appointed mission was to improve the nation’s business so all citizens would benefit. Hoover understood that the US economy was a myriad of connected systems networks, and he wondered how much the economy could improve if even some of his wartime policies were transferred to peacetime.
To Hoover, it was clear that the consumer was the driving force for the US economy, and also that regional economic problems could quickly become national economic problems. Hoover viewed Commerce (and the government) as the driving agent that would oversee and regulate the national economy so those regional problems would not cause national distress. Over time, Hoover was able to squeeze funding out of Congress to grow the Commerce Department, and everywhere in his dominion, Hoover eliminated political hacks - merit was the rule for Commerce.
Hoover attracted top-notch business talent to serve in Commerce at a fraction of the salary they would command in the private sector. Hoover had 25 distinguished leaders from industry, labor, and agriculture to help guide the department. Part of Hoover’s job was to show the private sector the value of data and up to date information on markets, which were designed to increase efficiencies and reduce costs, as well as to increase productivity and eliminate unnecessary competition. Hoover also wanted to improve the nation’s infrastructure in order to lower business costs, increase efficiency, as well as the speed of transportation. Hoover wanted Commerce to become the “balancer” between intelligent business and an intelligent (and fair) government. Hoover often sounded like Wilson, in that he made idealistic statements, but unlike Wilson he followed through with practical applications and paying attention to details.
First up for Hoover was addressing the government’s economic ignorance, in that reliable economic data was nowhere to be found in DC, largely since the Consumer Price Index had only been in existence for a year. Politicians simply didn’t understand markets (nor do they to this day), nor the impact of their decision-making on the economy. Hoover knew he couldn’t manage what he couldn’t measure, so He made Commerce the clearinghouse for all relevant data concerning the US economy. Again Hoover turned to experts, this time in academia, and soon enough Commerce was bringing in oceans of relevant economic data. Hoover wanted to be sure that economic shortcomings were communicated, especially government inefficiencies and waste. Hoover reached the point where he insisted on production standards on such consumer products as light bulbs. However, after getting the ball rolling at Commerce, disaster struck with a sharp post-Great War economic depression in 1921, which was mostly due to the nation transferring from a wartime to peacetime economy.
First up for Hoover was addressing the government’s economic ignorance, in that reliable economic data was nowhere to be found in DC, largely since the Consumer Price Index had only been in existence for a year. Politicians simply didn’t understand markets (nor do they to this day), nor the impact of their decision-making on the economy. Hoover knew he couldn’t manage what he couldn’t measure, so He made Commerce the clearinghouse for all relevant data concerning the US economy. Again Hoover turned to experts, this time in academia, and soon enough Commerce was bringing in oceans of relevant economic data. Hoover wanted to be sure that economic shortcomings were communicated, especially government inefficiencies and waste. Hoover reached the point where he insisted on production standards on such consumer products as light bulbs. However, after getting the ball rolling at Commerce, disaster struck with a sharp post-Great War economic depression in 1921, which was mostly due to the nation transferring from a wartime to peacetime economy.
The Federal Reserve made the economic depression worse by raising interest rates instead of lowering them, which tightened the money supply and discouraged and delayed recovery. Lower demand for agricultural products was also a factor for the depression. Gross National Product (GNP) fell, as did wages and prices, and unemployment increased. The traditional economic orthodoxy was to just wait out the bad times as had been done in every previous instance (including the “Other Great Depression” in the 1890s). SecTreas Mellon insisted on a minimum role of the government, wanting to reduce government spending. However, Hoover agreed with the newer economic theories, which had similarities to what John Maynard Keynes would come up with years later (Macroeconomics). The economic depression was stunning, swift, and deep, and it woke up many in the national government. There was a growing realization in DC that the government had a role in economic recovery, and by 20 August 1921, Hoover was ready to pressure Harding into action. Hoover knew that the business cycle could be affected by government decision-making and planning.
Courtesy of the Department of the Interior, the President’s Conference on Unemployment commenced on 26 September 1921 (among those present was Ida Tarbell, who had gone after John D. Rockefeller, and Samuel Gompers). Harding agreed to host the event on Hoover’s insistence, which showed that the President had confidence in his SecCommerce. For three weeks the members of the conference studied data provided by Commerce, and the conference’s findings were announced on 13 October 1921. Unemployment was between 3.5 and 5.5 million, and among the proposals was a faster timetable for public works projects as well as for encouraging private charity efforts, which would be spearheaded by local and state governments.
The conference’s final report generated positive headlines in the press, and the report was sent to 300+ mayors. But to Hoover’s great dismay and frustration, nothing of a legislative nature followed in Congress. Hoover wanted public works legislation and spending, but even the progressive maverick, Senator George Norris of Nebraska, opposed the idea; Hoover was very far ahead of the curve in 1921 compared to virtually anyone else in a position of power. By 1922, unemployment was going down, and the reasons why escaped almost everyone, including Hoover. The Federal Reserve had caused the depression by raising interest rates, and then the Fed eased the depression by lowering interest rates; the Fed had lowered the Discount Rate (then the major strategy to adjust the money supply) before the conference on unemployment had even started. In the midst of all of this economic malaise, Hoover had succeeded in saddling the government with more responsibility over the national economy, which was something that President Harding could not understand. With Hoover taking credit for during the economic depression, expectations were that the national government would be involved when the next economic depression occurred.
Courtesy of the Department of the Interior, the President’s Conference on Unemployment commenced on 26 September 1921 (among those present was Ida Tarbell, who had gone after John D. Rockefeller, and Samuel Gompers). Harding agreed to host the event on Hoover’s insistence, which showed that the President had confidence in his SecCommerce. For three weeks the members of the conference studied data provided by Commerce, and the conference’s findings were announced on 13 October 1921. Unemployment was between 3.5 and 5.5 million, and among the proposals was a faster timetable for public works projects as well as for encouraging private charity efforts, which would be spearheaded by local and state governments.
The conference’s final report generated positive headlines in the press, and the report was sent to 300+ mayors. But to Hoover’s great dismay and frustration, nothing of a legislative nature followed in Congress. Hoover wanted public works legislation and spending, but even the progressive maverick, Senator George Norris of Nebraska, opposed the idea; Hoover was very far ahead of the curve in 1921 compared to virtually anyone else in a position of power. By 1922, unemployment was going down, and the reasons why escaped almost everyone, including Hoover. The Federal Reserve had caused the depression by raising interest rates, and then the Fed eased the depression by lowering interest rates; the Fed had lowered the Discount Rate (then the major strategy to adjust the money supply) before the conference on unemployment had even started. In the midst of all of this economic malaise, Hoover had succeeded in saddling the government with more responsibility over the national economy, which was something that President Harding could not understand. With Hoover taking credit for during the economic depression, expectations were that the national government would be involved when the next economic depression occurred.
The business cycle and how the government could regulate it became Hoover’s obsession as SecCommerce. Economists became far more involved in shaping policy; while Fred Taylor (“Taylorsim”) and Henry Ford were scientific management experts in industry, Hoover took it upon himself to be the scientific management expert in the public sector.
Hoover wasn’t afraid to take on extra responsibilities as SecCommerce, even from other departments. Hoover proposed that 16 “sub-agencies” from other departments be moved to Commerce. Most of Hoover’s power grabs were repulsed, but he succeeded in absorbing the Bureau of Mines and the Patent Office, and what Hoover couldn’t absorb, he replicated in his department. Hoover’s rapacity was not appreciated by his fellow Cabinet members, especially from SecAg Henry Wallace. Hoover took on two crippled industries, railroads and coal, trying to address overexpansion and labor strife. In general, Hoover acted like the SecAg, SecLabor, and SecInterior; the Justice Department (created in 1870), hadn’t seen anyone like Hoover in its relatively short history, and didn’t know what to do about him, if anything.
Hoover even enacted his own foreign service program, a corps of commercial attaches which annoyed the State Department to no end. Those attaches were empowered by Hoover to do most anything short of closing transactions. Hoover understood that the US way of life was dependent on imports for items that the US could not (or would not) produce itself, such as rubber, tin, sugar, and coffee. In essence, Hoover wanted to use international trade to encourage the US to interact with Europe and the world as a way around the nation’s traditional Isolationism. It simply didn’t occur to Hoover that his fellow Cabinet members would be annoyed or offended by his actions. Hoover did complain about his stress as a result of their complaints about him, and he wondered why that energy wasn’t used towards directing their own departments.
Hoover wasn’t afraid to take on extra responsibilities as SecCommerce, even from other departments. Hoover proposed that 16 “sub-agencies” from other departments be moved to Commerce. Most of Hoover’s power grabs were repulsed, but he succeeded in absorbing the Bureau of Mines and the Patent Office, and what Hoover couldn’t absorb, he replicated in his department. Hoover’s rapacity was not appreciated by his fellow Cabinet members, especially from SecAg Henry Wallace. Hoover took on two crippled industries, railroads and coal, trying to address overexpansion and labor strife. In general, Hoover acted like the SecAg, SecLabor, and SecInterior; the Justice Department (created in 1870), hadn’t seen anyone like Hoover in its relatively short history, and didn’t know what to do about him, if anything.
Hoover even enacted his own foreign service program, a corps of commercial attaches which annoyed the State Department to no end. Those attaches were empowered by Hoover to do most anything short of closing transactions. Hoover understood that the US way of life was dependent on imports for items that the US could not (or would not) produce itself, such as rubber, tin, sugar, and coffee. In essence, Hoover wanted to use international trade to encourage the US to interact with Europe and the world as a way around the nation’s traditional Isolationism. It simply didn’t occur to Hoover that his fellow Cabinet members would be annoyed or offended by his actions. Hoover did complain about his stress as a result of their complaints about him, and he wondered why that energy wasn’t used towards directing their own departments.
By that time, Harding was more than happy with Hoover’s actions, and the President and SecCommerce occasionally combined their efforts. For example, Hoover wrote a letter that was signed by Harding that challenged the leading steel industrialist to go to 8 hour workdays instead of 12 hour days; the steel magnate was sufficiently embarrassed enough to make the change within a few weeks.
Hoover had been captivated by rivers and waterways since boyhood, and Harding had no problem with Hoover poking his nose into the business of the Department of the Interior. What to do about the Colorado River’s flooding was high on Hoover’s to do list, and in less than a year, Hoover brokered an agreement that the Upper Basin (CO, NM, WY, UT) and the Lower Basin states (AZ, CA, NV) would divide the Colorado River’s water 50/50. The Colorado River Compact proved to be crucial in the development of the American Southwest. Hoover was the only member of the Harding administration that was called upon to solve modern problems; for example, Hoover created national traffic standards given the increased number of cars on American roads. Over time, subdivisions within Commerce would become Federal Aviation Administration (FAA) and the Federal Communications Commission (FCC). Harding needed Hoover as a mover-and-shaker in what was otherwise a very stagnant and conservative Cabinet and administration. Hoover was the SecCommerce, and had become the de facto undersecretary to most of the other Cabinet departments.
The food shortage in the USSR brought back the humanitarian in Hoover, and he lobbied Congress hard for authorization to feed millions in the affected parts of the Soviet Union. The problem was that the US hadn’t recognized the USSR, and popular support for food relief in the Soviet Union was far less that relief in Belgium during the Great War. Feeling the heat from both political parties, Hoover simply stated that politics shouldn’t have a role when 20+ million people were starving.
Hoover had been captivated by rivers and waterways since boyhood, and Harding had no problem with Hoover poking his nose into the business of the Department of the Interior. What to do about the Colorado River’s flooding was high on Hoover’s to do list, and in less than a year, Hoover brokered an agreement that the Upper Basin (CO, NM, WY, UT) and the Lower Basin states (AZ, CA, NV) would divide the Colorado River’s water 50/50. The Colorado River Compact proved to be crucial in the development of the American Southwest. Hoover was the only member of the Harding administration that was called upon to solve modern problems; for example, Hoover created national traffic standards given the increased number of cars on American roads. Over time, subdivisions within Commerce would become Federal Aviation Administration (FAA) and the Federal Communications Commission (FCC). Harding needed Hoover as a mover-and-shaker in what was otherwise a very stagnant and conservative Cabinet and administration. Hoover was the SecCommerce, and had become the de facto undersecretary to most of the other Cabinet departments.
The food shortage in the USSR brought back the humanitarian in Hoover, and he lobbied Congress hard for authorization to feed millions in the affected parts of the Soviet Union. The problem was that the US hadn’t recognized the USSR, and popular support for food relief in the Soviet Union was far less that relief in Belgium during the Great War. Feeling the heat from both political parties, Hoover simply stated that politics shouldn’t have a role when 20+ million people were starving.
Hoover wanted to standardize as much as possible in the business world, such as trying to reduce the cost of building a home by at least one-third, as well as trying to gain better mortgage terms for borrowers. Hoover also wanted to standardize at least minimal levels of raising children, knowing first hand as a kid, and then by his own eyes as an adult, how miserable childhood could be, even in the US. Hoover’s efforts at standardization were attacked on economic and legal grounds, being perceived as interfering with free markets as well as encouraging collusion over competition.
The year 1922 proved to be the nadir of Post-WW I pessimism, with books such as Sinclair Lewis' Babbitt being best-sellers. It was also during 1922 that Hoover published “American Individualism”, where he argued that America’s best days were ahead due to the actions of individual Americans. Hoover sounded very much like Thomas Jefferson in preaching the values of virtuous behavior that would greatly benefit the nation. Hoover’s arguments were not new, since he borrowed heavily from the Founding Fathers, such as government should have a limited yet essential role in the lives of its citizens, and that only a sad necessity should force the government to go beyond that role. Hoover focused on advancing his social mobility and reveling in the glory of service as SecCommerce. To Hoover, there was no conflict of interest in promoting his self-interest and altruism at the same time.
The year 1922 proved to be the nadir of Post-WW I pessimism, with books such as Sinclair Lewis' Babbitt being best-sellers. It was also during 1922 that Hoover published “American Individualism”, where he argued that America’s best days were ahead due to the actions of individual Americans. Hoover sounded very much like Thomas Jefferson in preaching the values of virtuous behavior that would greatly benefit the nation. Hoover’s arguments were not new, since he borrowed heavily from the Founding Fathers, such as government should have a limited yet essential role in the lives of its citizens, and that only a sad necessity should force the government to go beyond that role. Hoover focused on advancing his social mobility and reveling in the glory of service as SecCommerce. To Hoover, there was no conflict of interest in promoting his self-interest and altruism at the same time.
President Harding had dealt with the 1921 economic depression, restored confidence within the business world, and put DC back on a responsible fiscal path after the Great War. It seemed “Normalcy” was gaining momentum, in that the Republicans did well during the Congressional Elections of 1922, and Harding was poised to be renominated by the Republicans in 1924. However, Harding’s troubles had started to mount. Republicans in the Senate were fractured, and often in a mutinous mood with Harding. Key industries were still struggling, and labor problems persisted. And then there were the idiots in his administration, such as the head official in the Veterans Administration that absconded with the money that was supposed to go to the creation of hospitals for veterans, and SecInterior Albert Fall, responsible for the Teapot Dome Scandal. By 1923, Harding realized that he needed to rely on members of his administration such as Hoover far more than his cronies, who were simply taking advantage of his good nature.
It was on a trip with his wife, Hoover, and some others to Alaska and back that Harding’s health took a turn for the worse. Harding appeared weak in Victoria (Canada) and Seattle on the return. As Harding was heading to San Francisco by rail, the press was told that Harding had experienced a negative reaction to shellfish. Starting on 29 July 1923, Harding was seen by many doctors over the next several days, and Hoover was often outside Harding’s room. On 2 August 1923, Harding died, and Hoover was just outside the door listening to the efforts of doctors trying to revive the President. Hoover quickly released a stirring tribute to Harding for the press. As Hoover returned to DC, on board the same train that carried Harding’s body, the SecCommerce wondered how Vice-President Calvin Coolidge would perform as the next President.
It was on a trip with his wife, Hoover, and some others to Alaska and back that Harding’s health took a turn for the worse. Harding appeared weak in Victoria (Canada) and Seattle on the return. As Harding was heading to San Francisco by rail, the press was told that Harding had experienced a negative reaction to shellfish. Starting on 29 July 1923, Harding was seen by many doctors over the next several days, and Hoover was often outside Harding’s room. On 2 August 1923, Harding died, and Hoover was just outside the door listening to the efforts of doctors trying to revive the President. Hoover quickly released a stirring tribute to Harding for the press. As Hoover returned to DC, on board the same train that carried Harding’s body, the SecCommerce wondered how Vice-President Calvin Coolidge would perform as the next President.