Herbert Hoover, Interventionist

As noted by Steve Horwitz, yesterday Paul Krugman again trotted out the old Herbert-Hoover-was-a-laissez-faire-radical-when-responding-to-the-Great-Depression canard. Horwitz is understandably outraged at Krugman's intellectual antics noting that, "At some point, this is no longer about laziness but about an intentional attempt to obfuscate and deceive, and to use propaganda to score ideological points." Horwitz recounts Hoover's efforts of economic intervention during the early years of the Great Depression and points to his Cato Briefing paper "Herbert Hoover: Father of the New Deal." I also have also briefly noted that, far from being a proponent of fiscal austerity, Hoover was a Keynesian.

Providentially, a full week before Krugman's latest adventure in economic history, Phillip Scranton authored a fascinating post on Bloomberg News' Echoes Blog that is quite relevant to the very issue in question. In his post, "Hoarding Cash After the Crash," Scranton documents President Hoover's effort in moral suasion, encouraging people to put their money back in banks, so banks can start lending again. What is quite prescient for the question of Hoover's economic policies are the perceptions of those contemporaries affected by his policies. Scranton quotes from the diary of Benjamin Roth, a lawyer from Ohio.

"Even those who invested after 1930 -- after the crash -- at what they considered bargain prices, now find their 'bargains' selling at half price or lower." He added: "Business shows no sign of pick-up. People are already looking toward the next presidential election when a Democrat will probably replace Hoover. In the meanwhile, Hoover adds to his long list of artificial stimulants."

It is the last sentence that I find revealing. Clearly Roth thought that Hoover was interventionist enough to refer to his "long list of artificial stimulants." In other words, no Ludwig von Mises, he.