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American History: How the Depression Hit Foreign Relations

Herbert Hoover and his wife, Lou Henry Hoover, in 1929

Herbert Hoover and his wife, Lou Henry Hoover, in 1929

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MARIO RITTER: Welcome to THE MAKING OF A NATION -- American history in VOA Special English.

The stock market crash of nineteen twenty-nine began a long and difficult period for the United States. President Herbert Hoover struggled to find solutions as the nation sank into the worst economic crisis in its history.

But the Great Depression was not the only problem demanding answers from Hoover. The president also had to deal with a number of foreign policy issues.

I'm Mario Ritter with Chris Cruise. This week in our series, we look at how the Great Depression affected relations between the United States and other countries.

(MUSIC: “Hard Times (No One Knows Better Than I)"/Ray Charles)

CHRIS CRUISE: There were revolutions in South America. Japan launched a campaign of aggression in northeastern China. And the economic situation in America created serious problems in relations with Europe.

Hoover succeeded in some areas of his foreign policy. But he failed to solve America's economic troubles. And, like most Americans, he failed to recognize the importance of political changes taking place in Japan and Germany.

MARIO RITTER: Herbert Hoover's foreign policy was marked by his desire to make friends and avoid war.

Like most Americans, the new president had been shocked by World War One. Hoover had seen the results of that terrible war with his own eyes. He led the international effort to feed the many European victims of the fighting. The new president was also a Quaker, a member of the Religious Society of Friends. Quakers oppose war.

Hoover shared the wish of most Americans that the world would never again fight a major war. To him, the bloody bodies at Verdun, the Marne and the other battlefields of World War One showed the need to seek peace through negotiations.

CHRIS CRUISE: Hoover worked toward this goal even before he entered the White House.

Following his election, he had several months before becoming president. Hoover used this time to travel to Latin America for ten weeks. He wanted to show Latin American nations that they could trust the United States to honor their rights as independent nations.

Hoover kept his word. The year after he took office, his administration announced that it would recognize the governments of all Latin American countries, including governments that the United States did not like.

Hoover told the American people that he would not follow the Latin American policies of President Theodore Roosevelt.

Teddy Roosevelt decided in nineteen four that the United States had a right to intervene in Latin America if it disagreed with the actions of governments there. Hoover said this was wrong. He told the country that it was more important to use friendship than to use force.


MARIO RITTER: Hoover withdrew American forces from Nicaragua. He also arranged to withdraw them from Haiti. And he showed restraint as some fifty revolutions shook the nations of Latin America.

Some revolutionary governments opposed the United States. They refused to pay debts to American companies, or they claimed ownership of foreign property. But Hoover refused to advance American interests by force. He wanted to prove that the United States could treat Latin American nations as equals.

That policy was quite successful. Relations between the United States and Latin American countries generally improved under Herbert Hoover's leadership.

CHRIS CRUISE: The situation in Europe was much more difficult and much more serious for the United States. The problem was simple -- money. The Great Depression did not stop at America's borders. It moved to Britain, Europe and beyond. And it brought extremely hard economic conditions.

In Germany, the value of the national currency collapsed. Inflation forced people to buy goods with hundreds, thousands, even millions of German marks. They lost faith in the system. And they looked for some new leader to provide solutions.

The economic crisis also put great pressure on the international circle of debt that had been created after the war. Suddenly, American bankers could no longer make loans to Germany. This meant that Germany could not pay back war debts to France and the other Allied nations in "the war to end all wars." And without this money, the Allied nations could not repay money that they owed American banks.

The circle of debt fell apart.

(MUSIC: "Brother, Can You Spare A Dime?"/Bing Crosby with Lennie Hayton and His Orchestra)

MARIO RITTER: The situation grew worse and worse throughout the early months of nineteen thirty. Hoover finally had to announce that all nations could delay their debt payments to the United States for one year.

Hoover's action did what he wanted it to. It put a temporary stop to the international debt crisis. But it caused great damage to private banks. People lost faith in the banking system.

Throughout Europe, people withdrew their money from banks. As a result, the European banks could not repay more than a billion dollars that they had borrowed from private American banks.

CHRIS CRUISE: This was not the only problem. Nations throughout Europe were also forced to take their currencies off the gold standard. This meant their money no longer could be exchanged for gold.

The economic situation grew worse. And, as it did, serious political tensions began to threaten peace in Asia and Europe.

MARIO RITTER: The threat in Asia became clear first.

Japan had defeated Russia in a war in nineteen five. This victory gave Japan control over the economy of the southern part of what was then called Manchuria, in northeastern China.

As years passed, Japan began to feel threatened by two forces. First, Chinese leader Chiang Kai-shek was trying to organize all of China under the control of his Nationalist forces. Second, Russia was extending the Chinese Eastern Railway to the Russian port city of Vladivostok.

Japan's army took control of the government in Tokyo in late nineteen thirty-one. The army was fearful of the growing threat to Japan's control of Manchuria. So it moved Japanese troops immediately into several Manchurian cities. And it claimed political control of the whole area.

President Hoover and most Americans strongly opposed Japan's aggression. But they were not willing to take any action that might lead to another world war.


CHRIS CRUISE: Japan's military leaders knew that the people of Europe and America had no desire to fight to protect China. And so the Japanese army marched on. It invaded the huge city of Shanghai, killing thousands of civilians.

Western leaders condemned the action. American Secretary of State Henry Stimson said the United States would not recognize Japanese control in these areas of China.

But, again, Hoover refused to consider any economic actions against the Japanese. And he strongly opposed taking any military action.

The League of Nations also refused to recognize Japan's takeover. It called Japan the aggressor in Manchuria. Japan reacted simply. It withdrew from the League of Nations.

MARIO RITTER: Most Americans were not happy about Japan's aggression. But they were not willing to fight force with force. This was less true, however, for Secretary of State Stimson.

Stimson was a follower of the old ideas of President Theodore Roosevelt. He believed a nation could only have a strong foreign policy by being strong and using its military power in times of crisis.

But Stimson's voice was in the minority. Most Americans did not believe Japan really threatened the security of the United States. And they were not ready to risk their lives to help people in China.

Opinions changed only after Japanese planes attacked the American naval base at Pearl Harbor, Hawaii, in December of nineteen forty-one.

CHRIS CRUISE: The same story was true in Europe. But France was worried about the rising power of the Nazis in Germany and the Fascists in Italy and Spain. France proposed the creation of an international army.

Hoover opposed that idea. He called for all nations to reduce their weapons. He believed that negotiation, not force, was the way to solve the problem.

But the new leaders in Germany and Japan would listen much more closely to the boot steps of marching troops than to the high words of peace.


MARIO RITTER: Our program was written by David Jarmul. You can find our series online with transcripts, MP3s, podcasts and pictures at You can also follow our series on Facebook and Twitter at VOA Learning English.

I'm Mario Ritter with Chris Cruise. Join us again next week for THE MAKING OF A NATION -- an American history series in VOA Special English.


This is program #178