You're almost right.
Hoover crippled his economy by doing exactly what everyone praised FDR for doing when he "saved" America from Depression. How the depression really ended (and some would argue that we never really recovered) is a topic for another blog (It wasn't FDR). But i need to address this common belief.
What they don't teach in school is that Hoover promoted legislation on conservation, oil, electric power, flood control, farming, labor arbitration, foreign debt, child hygiene, ocean shipping, exports and many many more. Sounds great right? Sounds familiar right? Didn't FDR promote a lot of similar forms of legislation that millions of Americans today applaud him for?
So how did this ruin the economy?
Hoover believed that certain people made too much money. He didn't address, however that a ton of the wealth that rich people acquire goes into savings and it also goes to fuel business investment. This benefits all society! Wealthy entrepreneurs create jobs, invest millions, and contribute to economic survival.
He also believed in what economists call, "purchasing power fallacy." He even said, and i quote, that he wanted: "To maintain the purchasing power of labor through high wages." He also believed that under no circumstances should companies ever lower wages of it's employees.
Here's the catch. This all sounds familiar to anyone who got a decent grade in History back in high school. But this shit right here is what they didn't teach you: High wages can not possibly be increased without an increase in production or productivity. When the government push up wages artificially above what can be justified by actual productivity, the only possible result is higher unemployment.
Answer this one: Would you rather A)Keep your job but have to deal with lower wages or B)Advocate higher wages (that the company can not maintain) and just get canned?
He also championed the Railway Labor Act which interfered with private labor relations. The act empowered the unions at the expense of the employers and this hurts the consumer. He also helped to push easy credit by having the Fed simply print more money. Easy money leads to mistakes in investment which leads to a bubble which eventually pops. (Housing Bubble...sound familiar?)
Hoover wanted to eliminate "destructive competition." *sighs* What destructive competition? Competition is what lowers cost and keeps consumers happy!
He also pushed for high protectionist tariffs. Gee, i wonder if it had anything to do with the fact that the people who benefited from them, were the ones who were too lazy (or simply weren't good enough) to compete for your business and decided instead to put there millions into his party. These tariffs only exacerbated the Great Depression!
He also taxed everything imaginable. We can thank Hoover for the following taxes: tax on gasoline, tires, cars, electric energy, malt, toiletries, furs, jewelry, and many many more. He also introduced stock taxes, taxes on bank checks, bond transfers, telephones, telegraphs, and radio messages. Then there was the raise of the personal income tax. All of this adding more and more fuel to the burning fire. (Hmmm.... Gee wizz mister, didn't we have a Revolution or something because of something along these same lines?)
So why do we as a society LOVE FDR (the thug and slayer of our Constitutional rights) for doing exactly what Hoover did only on a larger scale?
Better yet, why are we still doing this today?
A great free-market capitalist once said: "Isn't the definition of insanity when you do the same things over and over again and expect to get different results?"
[Factual references taken from "How Capitalism Saved America" by Thomas J. DiLorenzo]
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