The Politically Incorrect Guide to American History

14. Herbert Hoover and the Great Depression

05/04/2007 Thomas E. Woods, Jr.

Boom-busts were a feature of markets. Under consumption caused the depression. WWII ended the Great Depression. All three Keynesian beliefs were inaccurate. Only the Austrian Business Cycle Theory got it right.

Artificially lowered interest rates mislead investors. The Federal Reserve’s policy of cheap money creates mal-investments. The cause of boom-busts is this commercial credit expansion that is not backed by real pools of private savings.

Herbert Hoover’s policies prolonged the Great Depression. His agricultural policy was a disaster. Raising tariffs an average of 59% on more than 25,000 items hurt. Lots of tax increases crippled businesses. Hoover sought prosperity through central planning, as did his successor, FDR, who also knew nothing about how wealth was created.

Lecture 14 of 14 from Tom Woods’ The Politically Incorrect Guide to American History lecture series.

What is the Mises Institute?

The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard.

Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.

Become a Member