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The President's News Conference

December 11, 1931


THE PRESIDENT. In the recommendations that I have laid before Congress and in the organizations created in the last few months there is a very definite rounded program for turning the tide of deflation and starting the country on the road to recovery. That program has been formulated after consultation with men in public life, leaders of labor, of agriculture, of industry, and of commerce. A considerable part of it depends on voluntary action. That is already in motion. A part of it requires legislation. The legislation part of it is entirely nonpartisan. I am interested in the principles involved more than in the details, and I do appeal for unity of action for its early consummation.

Now, the major steps that we have to take are domestic. The action needed is in the home field, and it is urgent. The reestablishment of stability abroad is helpful to us, and I am confident that that is in progress, but we must depend upon ourselves. And if we do devote ourselves to our urgent domestic questions we can make a very large recovery independent and irrespective of any foreign influences. In order that the country may get the program thoroughly in mind, I want to review to you the major parts of it. And I may tell you that you will get a shorthand note of this.

One: Provision for distress amongst the unemployed by voluntary organization and the united action of local communities in cooperation with the Unemployment Relief Organization, whose appeal for organization and funds has met with a response that has been unparalleled since the war. Almost every locality in the country has reported now that it can take care of its own. But in order to assure that there will be no failure to meet problems as they arise, the organization will be continued over the winter.

The second point: Our employers have organized and will continue to give part-time work instead of discharging a portion of their employees. That plan is now literally assisting millions of people who otherwise would have no resources. And the Government will continue the very large Federal construction program over the winter. That program now is running at the rate of over $60 million a month.

Third: We are proposing to strengthen the Federal land bank system in the interest of the farmer.

Fourth: We are proposing assistance to homeowners, both agricultural and urban, who are in difficulties, in securing renewals of mortgages by strengthening the country banks, the savings banks, and building and loan associations through a system of home loan discount banks. I am confident that in restoring these institutions to their normal functioning we will see a revival in employment in new construction.

Fifth: Development of a plan to assure the early distribution to depositors in closed banks and thus relieve distress amongst millions of smaller depositors and smaller businesses.

Sixth point is: The enlargement under full safeguards of the discount facilities of the Federal Reserve banks in the interest of more adequate credits.

Seventh: The creation for the period of the emergency of a Reconstruction Finance Corporation to furnish the necessary credit otherwise unobtainable under existing circumstances, and so give full confidence to agriculture and industry and labor against any further paralyzing influences or shocks, but especially by the reopening of credit channels to assure the maintenance of normal working of the commercial fabric.

Eighth: This program has a proposal to assist all the railways by protection from unregulated competition, and to the weaker ones by the formation of a credit pool, as authorized by the Interstate Commerce Commission, and by other measures, thus affording security to the bonds held by our insurance companies, our savings banks, and other benevolent trusts, so as to protect the interest of every family and promote the recuperation of railway employment.

Ninth: Revision of the banking laws so as better to safeguard depositors.

Tenth: Safeguarding and support of banks through the National Credit Association, which has already given great confidence to bankers and extended their ability to make loans to commerce and industry.

Eleventh: Maintenance of the public finance on a sound basis by drastic economy; by resolute opposition to the enlargement of Federal expenditure until after recovery; and by temporary increase in taxation, so distributed that the burden may be borne in proportion to the ability to pay amongst all groups and in such a fashion as not to retard recovery.

Twelfth: The maintenance of our American system of individual initiative and individual and community responsibility in all these various problems.

The broad purpose of all this program is to restore the old job instead of creating a new made job; to help the worker at the desk as well as the worker at the bench, and to restore their buying power for the farmers' products to assist him. In fact, the program is to turn the processes of liquidation and deflation and to start the country forward.

The program affects favorably every man, woman, and child. It does not affect especially any one group or class. One of its purposes, of course, is to start the flow of credit now impeded by fear and uncertainty, to the detriment of every manufacturer, businessman, and farmer. In fact, to reestablish the normal functioning is what we need at this hour.


There is one other subject on which I can talk to you for a minute as background. This is not for quotation. It has an indirect bearing on the question of the foreign debt. Our total exports last year were about $3,800 million. Of this $678 million went to the United Kingdom and about $322 million--making it up to about a billion--went to other parts of the British Empire outside of Canada; that is, those parts peculiarly dependent on the United Kingdom. About $660 million went to Canada, which is also placed in that same complex. So that nearly one-half of the whole exports of the United States went to the British Empire.

Now, the British have lately passed two tariff bills. The first of these affected only $11,800,000 of American products. The second one, which was passed a few days ago, affected a larger volume of products and yet only affected $350,000, or practically no American products. In other words, out of all this vast volume of trade, that is direct trade to Great Britain, of $678 million, only $12,100,000 has been affected by their tariff provisions.

I will not give you the figures as to how it affects other countries, but they are very different from the relation to the United States. Now, the income of the British people is in sterling. They are off the gold basis. The payments that they have to make to us are in dollars. So that if you take the normal payment on British debt to us and convert it into the burden at the present exchange, you will find that that debt payment has increased 50 percent by virtue of their going off the gold standard.

I might mention one other fact in connection with it. There has been some discussion about these actions being undertaken to assist American bankers, and this I can tell you, that the British have more money in American banks than they owe to American banks--in fact, it is about the same--not very much either way. So that the American banker is not interested in what we do in this matter so far as his personal interest is concerned.

I give you these figures in juxtaposition because there is such a thing as national interest, and it is well worthwhile for the American people to consider where their financial interest lies in their relations to international economic problems.

As I say, that is entirely for background for you. It is not for quotation or authority, but I think that you ought to understand that we are not proceeding here without some regard for our own interests when we say that there are some of the people who owe us money on this debt who obviously will not be able to pay until they have made further recovery, and there are some people to whom it is a profit in consideration.

Thank you.

Note: President Hoover's two hundred twenty-fourth news conference was held in the White House at 4 p.m. on Friday, December 11, 1931.

On the same day, the White House released a text of the President's statement on the economic recovery program (see Item 437).

On November 30, 1931, the White House issued the text of a letter, dated November 28, from Walter S. Gifford, Chairman of the President's Organization on Unemployment .Relief, on the progress made in the relief of unemployment.

Herbert Hoover, The President's News Conference Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/207061

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