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Wherever did some Canadian economists get the strange idea that U.S. president Herbert Hoover "helped plunge his country into the Great Depression through austerity measures" (Economic woes bedevil Ottawa , Sept. 28).
Hoover never practised austerity. His government dramatically increased government spending. Federal spending rose from three per cent of the U.S. economy in 1929, the year he took office, to 8 per cent in 1933, the year he left office. The nation's budget deficit became so huge as a result that by 1932, it was spending more than $2 for every dollar it took in.
It was not austerity that deepened the Great Depression, but other measures backed by Hoover, like the Smoot-Hawley Tariff of 1930. That massive tariff increase triggered trade wars between the U.S. and other countries that wiped out millions of jobs.