Margaret Hoover Talks Politics, Depression Economics: Echoesby
Calvin Coolidge and the businessman-as-president were the topics of my column last week. In it, I depicted Herbert Hoover as a businessman who suffered the supreme humiliation of failing at the business of the presidency. Hardly an original move -- who doesn't criticize the 31st president?
But now Hoover is striking back, at least through the medium of his great-granddaughter, the television commentator and author Margaret Hoover.
In "American Individualism: How a New Generation of Conservatives Can Save the Republican Party," she argues that Herbert Hoover offers lessons for today's Republicans about connecting with young voters, and channels his thoughts about the American system. (Her book actually takes its title from a manifesto that Hoover published in 1922, "American Individualism.") Margaret Hoover also makes the case that her great-grandfather was a Millennial preincarnate who emphasized the very values that characterized the generation of youth that helped elect President Barack Obama.
The following is an edited transcript of my interview with her.
AS: Herbert Hoover was a stupendous businessman. At the height of his career he employed more than 100,000 people on four continents. That's what brought him into the public eye. But did he care about the nation's growth?
MH: Yes! Hoover's first emphasis was on the individual, the spark for all innovation and progress. This is a man who, while commerce secretary, standardized our modern economy, from brick sizes to bed sizes, so that housewives would not be frustrated when the sheets that arrived didn't fit. His "American Individualism" championed the ideal of equal opportunity, because Hoover believed that when individuals have a fair chance to apply their talents and skills to the marketplace, the individual becomes the engine of economic growth. He believed in a limited, but energetic, government that should play the role of a referee, to level the playing field for equal competition. He used the word "umpire." Here he was like Theodore Roosevelt. But he believed the best way to stimulate competition was to unleash the creativity of individuals. This is a prerequisite for growth.
Hoover himself had risen from the most modest means of any president since Abraham Lincoln. Orphaned as a small boy, he worked his way through Stanford's "pioneer" class -- the first freshmen at Stanford. He started his mining career in hard labor. He scorned French-style equality as an impossible goal, the "claptrap of the French Revolution." A state couldn't guarantee equality of outcomes, he knew that. (No one could match Hoover for insight into the destructiveness of the Soviet revolution -- he'd watched the local communist authorities trash a ceramics plant of his.) But he believed government should strive to deliver equality of opportunity.
Hoover said, "The economic system which is the result of our individualism is not a frozen organism. It moves rapidly in its form of organization under the impulse of initiative of our citizens, of growing science, of larger production, and of constantly cheapening distribution."
AS: So Hoover was a libertarian.
MH: Not at all. He was an American individualist -- an individual with a devotion to public service. He lived by this creed. Everyone forgets Hoover's organizational genius that saved 8 million Belgians from starvation during the English blockade in World War I, or his efforts with the American Relief Administration that saved an estimated 10 million Russians during the early Bolshevik famine from 1921 to 1923, the first foreign aid to an enemy nation, secured from Congress by Hoover. His biographers estimate that Hoover's food-relief efforts spared over one-third of Europe's population from death during and after World War I.
AS: How does Teddy Roosevelt fit next to Hoover? "Energetic presidency" sounds like "bully pulpit."
MH: Hoover's first political contribution was to TR's Bull Moose campaign in 1912. He fashioned himself a reform Republican like Teddy.
AS: Are you Quaker?
MH: No, I'm Episcopalian, like my great-grandmother, Lou Henry Hoover.
AS: Was it hard to grow up a Hoover?
MH: You certainly grow up on the defensive when you're related to America's most pilloried 20th-century president. My father got into fistfights in the schoolyard when he was young. "Your granddad caused the Great Depression -- whack!"
But being a Hoover also gave us the opportunity to get to know one of the most extraordinary individuals ever to occupy the Oval Office.
AS: So Hoover's not a libertarian. Is he even a capitalist?
MH: I'd call him a capitalist with a social conscience. He'd call himself an "American individualist." He despised laissez-faire economics, which he scoffed was "every man for himself and the devil take the hindmost." He had a deep sense of responsibility for his fellow man, and famously said, "Let the fortune go to hell" during his administration of the Committee for the Relief of Belgium, where he regularly pledged amounts far in excess of his personal worth to secure loans to deliver food supplies.
AS: What about foreign policy?
MH: Here Hoover saw that to which Coolidge was blind. Hoover was at Versailles and basically predicted that the raw deal we gave Germany would lead to another war. That was what we would label a major forecasting call.
AS: Would Hoover understand the Internet?
MH: Hoover also loved new media the way Millennials do now. He was the first person to ever appear on television. As commerce secretary, he standardized the radio industry so businesses could harness its commercial value. He didn't e-mail my great-grandmother a marriage proposal -- but he did cable her one, all the way from Australia.
Hoover believed deeply that the American ethos had responsibility for our neighbors, community and country imbued in its formula. This individual-centered society, steeped in service and sacrifice, characterizes the Millennial Generation. The Internet has created a paradox of making them deeply individualistic and hyperconnected at once. Their lives are customized to their tastes, from digital play-lists to social networking. But with heightened connectivity to one another, and the world around them, they have a strong sense of belonging to something larger than themselves. This is the essence of "American individualism."
AS: Why would voters like Hoover?
MH: I want to mention most of all, Hoover would also resonate with younger voters because of their own commitment to service. The relief projects he created were the sort they sign up for: feeding the poor, teaching the underprivileged, providing disaster relief like Hoover did in the 1927 Mississippi River flood. That was the Hurricane Katrina of his day. His lust for adventure is also modern: He went off to Australia after college, then China, then circumnavigated the globe five times by steamship, all before the advent of aviation.
AS: What would Hoover dislike in the agenda of today's Republicans?
MH: In the context of his day, Hoover was a social progressive. He was the first president to publically invite an African-American lady to the White House, and the "De Priest Incident" caused enough scandal for him to lose the support of the Virginia delegation -- apparently racism was a prerequisite for support. His Quaker values informed his steadfast commitment to the ideal of equal opportunity and social progress. My book opens with a lightning-bolt moment for me. The bolt came when I saw how a GOP campaign of 2004 attempted to drive socially conservative voters to the polls by rallying them against gay marriage. That was my Ms.-Hoover-goes-to-Washington moment. This became a symbol to me of how the Republican Party was falling out of step with young voters. Hoover understood that diversity was part of American life, especially when it came to religion. His quote was: "Our diversified faiths are the apotheosis of spiritual liberalism."
AS: If Hoover was a good model, why did the economy fare so abysmally in his period, from 1929 to 1932? Is he to blame for the Great Depression, as I've argued?
MH: First, Amity, your work in "The Forgotten Man" has reminded the intelligentsia that the economy actually worsened under FDR. And I don't think you actually believe that Hoover, who had been in office for six months by Black Tuesday, actually caused the Great Depression. This narrative is the remnant of a successful political smear campaign by the Democratic operatives to destroy Herbert Hoover's previously untarnished reputation. Apparently the trope is just too easy to repeat, even 80 years later.
Of course, we can agree that in handling the economic disaster, Hoover made mistakes. One was a big tax increase in the early 1930s. By the way, what people forget is that there was a Hoover tax cut after the crash. He proposed a $160 million cut along with a doubling of outlays for public buildings and dams. In fact, the top rate in 1930 was 24 percent, below Coolidge's 25 percent. Another was signing the Smoot-Hawley legislation (thought this was only 4 percent of the economy and some economists have argued that its impact has been vastly overstated). And another was encouraging businesses to freeze wages. But Hoover must be judged within the context of what was understood about economics at the time.
AS: They didn't know what they were doing?
MH: In 1929, the field of macroeconomics was seriously underdeveloped, and Hoover had none of the expertise or knowledge that we've gained as a result of the times he was in. Keynes -- let alone Hayek or Friedman -- wouldn't publish until after Hoover was out of office. At the end of the day, Hoover was no worse than his successor, and in many ways his economic instincts were better. He never would have led the massive federal overreach that the New Deal initiated. It's hard to see why he's vilified and Roosevelt idolized.
AS: What would a Hoover plan for growth look like now?
MH: In 1936, he said, "Blessed are the young, for they shall inherit the national debt." A Hoover growth plan would channel his business instincts. Stop printing money. Get our fiscal house in order. Balance the budget. Reform entitlement spending. Stop runaway spending in Congress. That will make sense to younger voters, too, who know the economy they are being given will afford them a lower standard of living than their parents had. Millennials understand that poor economic growth and our unsustainable spending is generational theft. It is also the right focus if we're going to get strong growth. Without entitlement reform, and a market-based health-care reform, there can't be growth. Hoover would also be deeply concerned about protecting businesses from further encroachment by government.
AS: So Hoover is a Millennial pre-incarnate. But why would heeding Hoover matter to a presidential candidate from his own party, the Republicans?
MH: Republicans are running out of time to connect with the next generation -- partisan identification solidifies after three presidential cycles. Millennials voted decisively for John Kerry in 2004 and Barack Obama in 2008. We have 16 months to make inroads with this generation -- the largest voting bloc in history, who will make up 24 percent of the votes in 2012, and who made all the difference in Obama's election. Youth voted overwhelmingly for Ronald Reagan in 1980 and 1984, so it's not out of the question.
But we have to understand their political sensibilities and make the case for a conservative pro-growth economic agenda that will put them to work, and bring them into the GOP.
(Amity Shlaes, a Bloomberg View columnist and a senior fellow in economy history at the Council on Foreign Relations, oversees the Echoes blog. The opinions expressed are her own.)
This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.
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