Advancing a Free Society

Hoover and DeLong

Friday, August 5, 2011

Brad DeLong points out that Hoover vetoed increased spending on veterans in 1931, then Congress overrode the veto. So Brad asks:

If Congress in 1931 passes a large benefit program for war veterans, and if Hoover vetoes it, and if Congress overrides the veto, and if the money is spent, does Hoover increase spending?

The title of DeLong’s post is “Fiscal Policy During the Great Depression.” Which is what I’m interested in. I’m interested in what happened to overall spending, not in cherry-picking one episode where Hoover vetoed one particular spending increase. Brad is right in that Hoover is not completely responsible for what happened to spending during his watch. It would be interesting to see how eager he was to increase spending. But there is the independent question of what happened to spending at the onset of the Great Depression. The myth is that spending went down. What actually happened is that spending went up between 1929 and 1933.

Continue reading Russ Roberts…