America's Money Machine

The New Thermopylae 165
its defects resulted in its ultimate rejection for a return to the pre-Christian
and pre-Judaic view of the necessity of authoritarian controls.
This digression into what may be termed theology rather than economics
has been necessary to present the dilemma in which President Hoover
found himselfin his efforts to restore order following the 1929 collapse.
Hoover was dedicated to individualism, though it is not apparent how
defined and explicit his convictions were. He was also subject to the
political and intellectual currents of his times, and these were already
running strongly against individual solutions and in favor of increased
governmental and authoritarian intervention. While Secretary of Commerce,
Hoover had directed studies to be made to the extent to which
the recurrent business cycle could be slowed or modified by countercyclical
public work expenditures-hardly anticipating either the extent
of the future depression or the magnitude of the adopted remedy.
On November 15, 1929, Hoover announced a conference ofleaders of
business, industry, and finance, on ways to spur business under private
initiative, by expanding construction and. maintaining employment and
wage rates. He thus indicated where responsible leadership should lie,
but at the same time he announced that the government at all levels
would assist with building projects.
A preliminary conference of Eastern railway presidents issued a statement
that they were "unanimous in their determination to cooperate in
the maintenance ofemployment and business progress.... The railways
would proceed with full programs of construction, and betterments."
Among those attending the November 21 conference were such figures
as Henry Ford and Alfred P. Sloan,Jr., heads ofthe automobile industry;
Walter Teagle of Standard Oil, representing the petroleum industry;
Owen D. Young of General Electric and the electrical utility industry;
Walter Gifford, head of the Bell Telephone System; E. G. Grace and
Myron Taylor, of the steel industry, and Julius H. Barnes, representing
the u. S. Chamber ofCommerce. The press statement that followed was
reassuring: construction work would be expanded; the Bell system would
spend in 1930 more than the $600 million spent in 1929; other utilities
would do likewise. While the automobile representatives were less optimistic,
Grace and Taylor promised for the steel industry that plant replacements
would be made. Most significant was the commitment of
these representatives in regard to wages-cautious, and non-committal:
"The President was authorized by the employers who were present
. . . to state on their individual behalf that they will not initiate any
movement for wage reduction."